What's Happening in Sustainability? (Week Recap 09.05 - 15.05) 🌎

This week’s read time: 5 minutes

Welcome to this edition of Green Digest, where you will get updated about everything happening in the sustainability & ESG space in less than 10 minutes 🌎We go through tons of articles and data from the most reliable sources, filter & simplify them and serve them to you in bite-sized chunks every week. 🍀

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The week’s most important news:

🇺🇸 The Biden administration has proposed new rules to reduce greenhouse gas emissions from the power sector, with reductions of over 600 million metric tons of CO2 pollution through 2042 and $85 billion in climate and health benefits. The proposals include new standards for coal and natural gas-fired power plants and would require more CO2 emissions controls to be put in place at fossil fuel-fired power plants starting in 2030. While the proposals would contribute significantly to the achievement of U.S. climate goals, they are likely to face political pushback and legal challenges.

🇪🇺 As reported earlier, the European Parliament has now adopted a new law aimed at cutting methane emissions, with a focus on sectors including oil, fossil gas and coal, as well as biomethane, in a 499-73 vote. The new law would be the first EU-wide legislation mandating methane emissions reductions and is part of the European Commission’s “Fit for 55” roadmap to cut greenhouse gas emissions by 55% by 2030. The European Parliament has also voted in favor of a new directive aimed at improving product durability and combatting misleading environmental claims on consumer labels, such as "CO2 neutral" or "carbon neutral". The directive will ban the use of generic environmental claims not supported by evidence and misleading practices, such as making green claims about the whole product when only one part is sustainable. The directive also introduces a ban on environmental claims based on carbon offsetting schemes and a guarantee label to indicate mandatory guarantee lengths and potential extensions.

🇦🇺 Australia's Albanese government has announced plans to invest AU$2 billion (~$1.3 billion) in the development of the country's renewable hydrogen industry as part of a $4 billion clean energy-focused budget. The "Hydrogen Headstart" program aims to support large-scale strategic hydrogen projects and put Australia on track for up to 1 GW of electrolyzer capacity by 2030. The budget also includes investments in industrial decarbonization, residential energy efficiency, and new clean energy industries and innovations to decarbonize existing industries.

🇨🇳 China's Ministry of Ecology and Environment announced that the country will implement upgraded vehicle emission standards from July 1, including a ban on production, imports, and sales of vehicles that do not comply with its emission standards. Real-Driving Emission tests will also be required, adding pressure on automakers and dealers to clear inventories of non-compliant vehicles. A six-month grace period has been granted for sales of light vehicles that do not meet the RDE tests in the new standards. An estimated 2 million vehicles fail to meet the RDE tests as of the end of March.

🌎 According to a new study by MSCI, over a third of public companies now report on Scope 3 emissions, and there has been a significant increase in corporate decarbonization commitments. However, direct emissions from companies have not declined this year and are on track to exceed the global goal of limiting temperature increase to 1.5°C. The study also found that the targets set by companies vary widely in quality and comprehensiveness, with only 30% including net zero goals and 17% aligning with a 1.5°C pathway.

💡 More interesting news:

• For the first time, wind power generated more electricity than gas-fired power stations in the UK, with turbines generating 24 TWh in Q1 of 2023. Wind supplied 32.4% of the country's electricity, while gas supplied 31.7%. Almost 42% of the UK's electricity came from renewable sources, and the country has almost completely cut out coal. Drax, once the largest coal-fired power station in Western Europe, is now the single largest generator of renewable power in the UK, with four of its six generating units converted to use sustainable biomass. 🇬🇧

• The UK High Court dismissed a lawsuit brought by environmental law organization ClientEarth against the board of directors of Shell, which argued that Shell's energy transition strategy was flawed and put shareholder value at risk. The lawsuit was seeking to hold corporate directors personally accountable for preparing for the energy transition. The judge agreed with Shell's argument that the incidental duties were vague and amounted to an unnecessary elaboration of the statutory duty of care. ClientEarth is considering its next steps. 👀

• A study by State Street reveals that institutional investors globally have increased their exposure to carbon emissions over the past year, despite a double-digit decline in carbon intensity. The State Street S&P Global Institutional Investor Carbon Indicator examines portfolio emissions exposure and intensity exposure and found that the biggest drivers of increased carbon exposure were the carbon-intensive Energy, Materials, and Utilities sectors. The price effect was the greatest driver of increased portfolio carbon exposure, followed by the company effect as emissions grew with economic activity. ⛔️

• While a new report by Clarity AI found that only 20% of sustainability-labeled investment funds classified as Article 8 under the EU’s Sustainable Finance Disclosure Regulation would meet the criteria of new proposed fund labeling rules aimed at reducing greenwashing risk. The report also found that barely any funds labeled as ‘sustainable’ would meet the proposed fund naming rules across the EU, UK, and U.S. The study examined data from over 18,000 funds across Europe. ⛔️

🧐 What are companies doing?

• Microsoft has agreed to source energy from Helion's planned fusion power plant, expected to be the world's first, which is set to come online by 2028. Helion's fusion approach includes the use of deuterium and helium-3 as fuel, and its first plant is expected to generate at least 50 MW of power one year after rollout. The deal will help Microsoft achieve its own climate goals, including its target to achieve carbon-negative status by 2030. 💡

• Honeywell has launched UOP eFining technology, a processing solution that enables the production of sustainable aviation fuel (SAF) from captured CO2 at scale. The technology can reduce greenhouse gas emissions by 88% compared to conventional jet fuel. The facility is expected to recycle approximately 2 million tonnes of captured CO2 to produce 180 million gallons (≈681m liters) of SAF per year. SAF is seen as a key tool to help decarbonize the aviation industry, with demand likely to rise as airlines turn to the technology to hit climate goals and governments mandate increased SAF use. 🛩️

• BNP Paribas has announced that it will no longer provide direct financing for new oil and gas fields, becoming the second largest global bank to commit to exiting new oil and gas project financing. The move is part of the bank's policy to reduce its fossil fuel financing activity, and it is expected to pressure other major European banks to follow suit. BNP Paribas has also released a series of new energy financing policies, including commitments to reduce financing for oil and gas extraction and production and transition 80% of its energy financing activities to low-carbon energies by 2030. ✅

• Deutsche Post DHL Group has launched its GoGreen Plus service for DHL Aviation, which will enable air cargo customers to reduce their Scope 3 emissions through the use of sustainable aviation fuel (SAF). The service will allow shippers to replace conventional fossil fuels with SAF or other clean technologies, with the aim of offering real emissions reductions. DHL air cargo customers will be able to use the service from June 2023, and the company aims to use at least 30% of SAF blending for all air transport by 2030. 🛩️

• Volvo Trucks has successfully tested hydrogen-powered fuel cell electric trucks on public roads, expanding its lineup of CO2-neutral vehicles. The fuel cell trucks will be available in the second half of the decade, with tests starting a few years prior to commercial launch. Volvo has also joined forces with Daimler to develop fuel cell systems for heavy-duty vehicles, launching a joint venture called "Cellcentric" in 2021. The tests were carried out in Northern Sweden, with harsh conditions that make an ideal testing environment. 🚚

• Emirates has launched a $200 million fund to invest in research and development projects aimed at reducing the environmental impact of fossil fuels in commercial aviation. The fund will focus on advanced fuel and energy technologies, with the funds to be dispersed over three years. Emirates Airline President Sir Tim Clark said that new solutions will be required to meet net zero targets in the industry, and the new initiative follows similar emissions reduction solutions by other major airlines, including Delta and United. 🛩️

• EY has launched EY OpsChain ESG, a blockchain-based solution that enables companies to measure and track their carbon footprint and provides transparency and traceability for carbon credits. The solution, built on the Ethereum blockchain, tokenizes products' emissions to achieve and report a verifiable view of current CO2 positions and is based on the standards of the InterWork Alliance for Carbon Emissions Tokens. ✅

• S&P Global Sustainable1 has launched a new Nature & Biodiversity Risk dataset, which uses the Nature Risk Profile methodology to assess nature-related risks and impacts for over 17,000 companies and 1.6 million assets. The dataset provides metrics such as The Ecosystem Footprint to help companies and investors understand their impact and dependency on nature. The launch comes as global efforts to address nature-related issues pick up pace, and companies face increasing pressure to assess and report on nature and biodiversity-related issues. 🍀

• IBM has launched the IBM Cloud Carbon Calculator, a dashboard-based solution that allows organizations to track and analyze greenhouse gas emissions associated with their IBM Cloud workloads. The solution enables users to view and analyze emissions over time, identify emissions hotspots, and provide insights for emissions mitigation strategies. The tool can also help satisfy sustainability reporting needs and integrate data into IBM's ESG Suite. ✅

• Clarity AI and GIST Impact have partnered to develop a biodiversity impact assessment product for investors. The solution will allow clients to measure and size their exposure to companies that negatively impact biodiversity, taking into account regulatory requirements such as the Sustainable Finance Disclosure Regulation and the Taskforce on Nature-related Financial Disclosures. The partnership combines Clarity AI's technology and product ecosystem with GIST Impact's expertise in biodiversity and impact metrics. 🍀

• State Street has launched a new solution, the State Street Carbon Asset Servicing Solution, to help asset managers and owners integrate carbon-related assets into portfolios and manage them more easily. The solution comes as the market for carbon-related assets is growing rapidly, with approximately 12.5 gigatons of emissions traded last year and industry estimates forecasting a 15x increase in demand for carbon credits between 2021-2030. 🌎

• Telecom giant Verizon has issued its fifth $1 billion green bond offering, with net proceeds to be invested in renewable energy. The company aims to source or generate renewable energy equivalent to 100% of its total annual electricity consumption by 2030. Verizon has now issued $5 billion in green bonds since 2019 and secured 3.2 GW of expected renewable energy capacity via 25 virtual power purchase agreements.💡

👀 Where is cash flowing?

🔋 French EV charging company Driveco has raised €250m from Dutch pension fund manager APG to expand its network across Europe. The company aims to open over 60,000 charging points across seven countries by 2030, with the funding set to strengthen its presence in France and Europe, accelerate international expansion, and consolidate its technological innovation strategy. Driveco's goal is to enable the charging of over 1.2 million vehicles per year and avoid 3 million tonnes of CO2 emissions annually.

🔋 JOLT Energy, a Charge Point Operator (CPO), has secured a €150 million investment from InfraRed Capital Partners to further develop its ultra-fast EV charging infrastructure in North America and Europe. The Dublin and Munich-based company offers up to 200 km of charging in 10 minutes via accessible charging stations with integrated battery storage and is focused on building out infrastructure in urban areas with insufficient EV charging facilities. The funding will support JOLT's aim of expanding its charging network and contributing to tackling the climate crisis.

🌾 Swiss robotics startup Ecorobotix has raised $52 million in Series B funding for its precision spraying robots for row crops and pastures. The funding will be used to expand its business, with a focus on bringing its robots to the Americas. Ecorobotix's AI-powered plant-recognition system has a precision range of 6x6 cm and can reduce input costs by 70-95%, in addition to increasing crop yields and preserving biodiversity. The company's ARA platform works with 13 herbicides, fungicides, and pesticides on various crops.

🍀 Modern Hydrogen has raised $32.8 million in a Series B-2 funding round led by NextEra Energy. The funds will be used to scale up hydrogen production units and expand the company's clean carbon material offerings. Modern Hydrogen's technology can deliver decarbonized gas on location without the need for new pipelines or massive infrastructure upgrades and can generate net negative emissions by applying its pyrolysis technology on carbon-neutral gases such as biogas.

🌎 Cloverly, a climate tech startup based in Atlanta, has raised $19 million in a Series A funding round to develop its voluntary carbon markets (VCM) infrastructure platform and expand its team and global presence. The company offers an API to calculate carbon emissions and purchase offsets in real time, a supplier platform offering credits from multiple carbon removal suppliers, and software for suppliers to manage commercial operations. The proceeds will be used to fund the development of VCM infrastructure, support a major headcount expansion, and launch a second headquarters in London.

That’s it for this week. Thanks for making it to the end, your attention span is absolutely impressive 💪.

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