What's Happening in Sustainability? (Week Recap 25.04 - 01.05) 🌎

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 European Commission and the European Investment Bank have announced €18 billion of financing under Global Gateway, Europe’s investment strategy for partner countries. This will boost investment in climate action, clean energy, and connectivity in Europe’s partner countries worldwide, helping to bridge the global climate finance gap and support prevention, adaptation, and mitigation. The initiative will contribute to achieving the Sustainable Development Goals and make partner countries more resilient.

🌎 Carbon dioxide removal technologies are one of the hottest areas of climate research but also the most controversial. The debate over whether and how to develop CDR has been ignited by the release of the final section of the comprehensive review of climate science by the IPCC. Some scientists say the technology must be the immediate priority for research, while others urge caution and warn against putting faith in untested technology before we have even fully deployed the reliable low-carbon technologies, such as renewable energy, that we already have.

👀 Less than half of professionals are confident in their organizations' finance teams to gather and report on ESG financial metrics, according to a survey by Deloitte. Data collection and staffing shortages were the top ESG reporting challenges. The survey also found that few organizations have dedicated ESG reporting professionals, despite significant perceived benefits. However, confidence in ESG reporting capabilities increased significantly if organizations had dedicated ESG reporting staff in place or if finance teams were involved in ESG matters. The low confidence marks of the poll come as organizations globally will be expected to meet increasing regulatory requirements to report on their climate and sustainability-related risks, opportunities, and plans.

💡 More interesting news:

• The European Parliament and the EU Council have agreed on new proposed rules, called ReFuelEU Aviation, aimed at decarbonizing the aviation sector by increasing the use of Sustainable Aviation Fuels (SAF). The proposed rules include minimum blends of SAF for fuel suppliers, as well as requirements for aircraft operators and airports. The rules would require a minimum share of SAF at EU airports, starting at 2% in 2025 and increasing to 70% by 2050, as well as a minimum share of synthetic fuels starting in 2030 and increasing through 2050. The new rules also include requirements for airports to ensure that their fueling infrastructure is fit for SAF distribution. 🛩️

• The EU Parliament's Environment and Industry Committees have also adopted new legislation aimed at reducing methane emissions from the energy sector, covering direct emissions from oil, fossil gas, coal, and biomethane. MEPs are calling for a binding 2030 reduction target for EU methane emissions, and for operators to submit a methane leak detection and repair program. The legislation also includes a ban on venting and flaring of methane, and requires EU countries to establish mitigation plans for abandoned coalmines and inactive oil and fossil gas wells. ✅

• Indigenous leaders at the 22nd United Nations Permanent Forum on Indigenous Issues have warned that the west's climate strategy risks exploiting Indigenous territories, resources, and people. The transition to a greener economy, including mineral mining, is presenting conflicts in tribal communities worldwide. The exploitation of Indigenous peoples is happening in the name of conservation and is driven by "green colonialism," according to Gunn-Britt Retter of the Saami Council. ⛔️

• The overuse of antibiotics in farming has led to the emergence of bacteria that are more resistant to the human immune system, according to a study by the University of Oxford. The antimicrobial colistin, which was used for decades as a growth promoter on pig and chicken farms in China, resulted in the emergence of E coli strains that are more likely to evade our immune system’s first line of defence. The findings could also have significant implications for the development of new antibiotic medicines in the same class as colistin, known as antimicrobial peptides (AMPs), which the scientists suggest could pose a particular risk of compromising innate immunity. ⛔️

🧐 What are companies doing?

• Daimler Truck North America, NextEra Energy Resources, and BlackRock Alternatives have launched Greenlane, a joint venture to develop and operate a nationwide US EV charging network for commercial vehicles. The companies have committed over $650m to the venture, which will design, develop, install and operate a network of zero-emission public charging and hydrogen sites for medium- and heavy-duty battery-electric and hydrogen fuel cell vehicles, built on critical freight routes along the east and west coasts and in Texas. 🚙

• The LEGO Group and Novo Nordisk have partnered with European Energy to use e-methanol, produced from renewable energy and captured biogenic CO2, to replace fossil fuels in plastic production. The delivery of e-methanol is expected to begin in 2024 and will be used to reduce the carbon footprint of products such as medical devices and LEGO bricks. The companies' sustainability strategies are focused on reducing their environmental impact and transitioning away from fossil fuels. 🍀

• KPMG and Context Labs have allied to help companies measure and reduce their environmental footprints using advanced climate data and analytics enabled by machine learning, AI, and distributed ledger technology. The alliance will combine KPMG's capabilities in environmental monitoring, analytics, and reporting with Context Labs' technology to support companies working to reduce environmental impact, analyze decarbonization efforts, and provide transparent and traceable data from investors, regulators, and other stakeholders. ✅

• Nestlé will use Pléiades Neo satellites from Airbus to monitor its reforestation efforts, ensuring that the trees planted are thriving. The company has committed to restoring and growing 200 million trees in its sourcing areas by 2030 as part of its "forest positive" strategy and goal to achieve net zero greenhouse gas emissions by 2050. The pilot project will be applied to Nestlé’s reforestation project in Southern Thailand, with Pléiades Neo satellites monitoring over 150,000 shade trees in farms where Nestlé sources its coffee. 🌲

• L'Occitane Group has announced its Climate Strategy, with the goal of achieving net zero emissions across its value chain by 2050. The company's climate goals include reducing Scope 1 emissions by 46% by 2031, sourcing 100% renewable electricity across its factories, warehouses, stores and offices by 2026, and reducing absolute emissions across Scope 1 and 2 by 90% by 2050. It has also pledged to reduce its Scope 3 emissions intensity by 97% by 2050, with initiatives to improve sourcing low carbon materials for its products, using recycled and low-carbon materials for packaging, and developing sustainable packaging such as eco-refills and in-store bulk dispensers. ✅

📈 Sustainable Finance:

• According to a report from Moody's Investors Service, issuance volumes of green, social, sustainability, and sustainability-linked bonds rebounded strongly in Q1 2023, resuming double-digit growth trends after falling 18% in 2022. The increase was led by a sharp growth in green bonds, with an increasing number of sovereign issuers joining the market, and as European issuers continue to gain share of issuance volumes, with the North American market remaining relatively dormant. Moody's maintained its forecast for the GSSS bond market to grow 10% in 2023 to issuance of $950 billion, after declining 18% in 2022 to $862 billion, from a record $1.05 trillion in 2021. 🍀

• Citigroup facilitated $123.5 billion in sustainable finance in 2022, down 24% YoY due to macroeconomic and geopolitical headwinds, but still nearly double the activity level in 2020. Despite the decline, Citi remains on track to meet its 10-year $1 trillion sustainable finance goal, with $348.5 billion financed and facilitated between 2020-2022. Environmental-related finance represented nearly all of the decline, with sustainable transportation accounting for almost half. Investment Banking’s sustainable finance activity fell by $43 billion, while corporate lending grew 39%. Citi's sustainable finance activity fell sharply in North America but picked up significantly in Europe, Middle East and Africa. 📈

• BBVA has also allocated €150 billion in sustainable business from 2018 to March 2023, half of its €300 billion target set for the 2018-2025 period. Nearly €14 billion was mobilized in the year’s first quarter, with 79% earmarked to favor action against climate change and 21% directed at promoting inclusive growth. Corporate finance, transactional banking activity, and individual financing accounted for 73% of the 150 billion euros, while brokered third-party bonds, project finance, and investment products managed or marketed by BBVA accounted for the rest. The retail business, commercial banking, and corporate banking all saw growth in sustainable funding, and BBVA allocated €3.3 billion to financing inclusive growth initiatives in the first quarter of 2023. 📈

• Apollo has launched a new investment strategy, Apollo Clean Transition Capital (ACT Capital), aimed at investing $4 billion in companies to support their transition to clean energy and sustainable industry. The new strategy will provide flexible financing through yield and hybrid investments, targeting areas such as energy transition, industrial decarbonization, and sustainable mobility. ACT Capital follows the establishment of Apollo's sustainable investing platform last year, which has already deployed over $6 billion and aims to deploy $50 billion in clean energy and climate capital over five years. 💡

• Standard Chartered has updated its emissions reduction goals, replacing its intensity-based oil and gas sector financed emissions reduction target with a new commitment to reduce absolute emissions from its activities in the sector. The bank aims to reduce absolute emissions by 29% by 2030 and clarified its position on the role of natural gas in the energy transition, supporting lower emissions intensity alternatives, with natural gas, including LNG, playing a role in the reduction of overall emissions. ✅

👀 Where is cash flowing?

🌎 Carrier, an HVAC, refrigeration and sustainable building solutions company, has acquired Viessmann Climate Solutions for $13.3 billion, as part of a series of moves aimed at positioning the company as a pure-play climate and energy solutions leader. Viessmann Climate Solutions is a heat pump and energy transition-focused heating solutions manufacturer, with 70% of its business consisting of heat pumps and related accessories, solar PV, batteries and services.

🍀 Green hydrogen tech startup Ohmium International has raised $250 million to scale its business, including manufacturing capacity for electrolyzers and international growth. Ohmium designs and manufactures modular, scalable proton exchange membrane (PEM) electrolyzer systems for the production of green hydrogen, using 100% renewable energy. The investment will support the company's expansion to 2 GW in annual manufacturing capacity and accelerate international growth, including R&D programs aimed at reducing the cost of green hydrogen production.

🏢 San Francisco-based startup SPAN has raised $96 million in a Series B financing round led by Wellington Management, with participation from investors including Qualcomm Ventures and Amazon’s Alexa Fund. SPAN develops products aimed at enabling residential electrification and clean energy adoption, and plans to use the funds to expand its reach into new categories including major home appliances and smart home devices. The company has seen rapid growth, with revenue increasing almost 600% in 2022, and aims to extend its integration to every high-energy load in the home.

💡 Italian climate startup Energy Dome has raised €40 million ($44 million) in a Series B funding round led by Eni Next and Neva SGR, bringing the total raised to €54 million ($60 million). Energy Dome's CO2 Battery uses a closed-loop cycle to store energy generated from renewable sources, such as solar, by changing CO2 from gas to liquid and back to gas to generate heat. The battery can store renewable energy with 75% RTE and is half the price of lithium batteries. The funds will be used to enter full commercial scaling mode, with the US being a principal market.

⭐️ CarbonChain, a UK-based climate solutions startup, has raised $10 million in a Series A funding round led by Union Square Ventures and Voyager Ventures. The funds will be used to expand its AI-powered carbon accounting platform, build new carbon accounting and reporting products, and grow its team. CarbonChain's platform automates emissions tracking with granular, asset-level data, providing visibility into Scope 3 and supply chain emissions, and its customers include Societe Generale, Rabobank, and Gunvor.

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

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