What's Happening in Sustainability? (Week Recap 23.05 - 29.05) 🌎

This week’s read time: 7 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 Carbon Capture Coalition has challenged a United Nations advisory body's assertion that carbon removal activities are "technologically and economically unproven" and "do not serve any of the objectives" of the global carbon market called for in Article 6 of the 2015 Paris climate accord. The coalition argues that carbon dioxide removal (CDR) methods are essential for offsetting emissions in sectors with challenging-to-abate emissions and for reducing the concentration of CO2 in the atmosphere post-2050. On the other hand, David Antonioli, CEO of Verra, the world's leading carbon credit certifier, will step down amid concerns that the nonprofit approved millions of worthless offsets used by major companies. A joint investigation found that Verra rainforest credits used by Disney, Shell, and Gucci were largely worthless, often based on stopping the destruction of rainforests that were not threatened. Verra is in the process of introducing new rules for generating rainforest carbon credits, with all projects set to be using the new system by mid-2025.

💡 According to the International Energy Agency’s (IEA) report, World Energy Investment 2023, clean energy investment is set to exceed fossil fuel investment by around 70% this year, with solar PV attracting more capital than oil production globally for the first time ever. Renewable energy is the biggest driver of the growth, attracting more than $650 billion in capital in 2023, up 11% year-over-year, and 75% over the past five years. However, the report also found significant concentration in the sector, with more than 90% of the investment growth over the past two years taking place in China and advanced economies such as the EU and U.S.

🇪🇺 The European Commission is facing opposition to new EU laws aimed at protecting the environment, including landmark nature bills and a goal to halve chemical pesticide use by 2030. The European Parliament's biggest group, the European People's Party, has called for the nature law to be scrapped, saying it would hurt farmers. Other EU green proposals have also met resistance, and as the elections approach, unfinished laws are piling up. Their fate would be unclear under a new EU Parliament with a different composition.

🌎 A $100 billion plan to provide currency guarantees to investors in developing countries for green transition investments will be presented at a summit in Paris next month, according to a document seen by Reuters. The plan would rely on the International Monetary Fund and other multilateral development banks and aims to drive more money into climate and development finance in poorer countries. The guarantees would compensate international buyers of green bonds if the country involved devalued its currency and effectively cut the dollar-value of its bond payments. The proposals are likely to form a key part of the negotiating position of developing countries at the next round of annual climate talks in Dubai later this year.

⛔️ Ron DeSantis, the Republican Florida governor and US presidential candidate, has been criticized for his approach to the climate crisis, including dismissing concerns about global heating as “leftwing stuff” and rejecting the “politicization of the weather”. Climate scientists have warned that the heating of the ocean and atmosphere is causing storms to intensify and become more powerful. Environmental groups have also criticized DeSantis for his record on climate, which they say is no better than Donald Trump’s, his rival for the Republican presidential nomination.

🇮🇳 India plans to challenge "agenda-driven" country rankings produced by global agencies on topics like governance and press freedom, according to Sanjeev Sanyal, a member of Indian Prime Minister Narendra Modi's Economic Advisory Council. Sanyal said the indices were being compiled by a "tiny group of think-tanks in the North Atlantic," sponsored by three or four funding agencies that are "driving a real-world agenda." India has begun to raise the issue at global forums and has pointed out flaws in methods used to compile global indices used by institutions like the World Bank, World Economic Forum, and the United Nations Development Programme. Meanwhile, the European Union has promised to hold talks with India to address concerns over proposed tariffs on high-carbon goods such as steel and iron ore. The tariffs are part of the EU's plan to reach net zero greenhouse emissions by 2050. Indian industry officials estimate that nearly $8 billion of exports could face tariffs initially, but all goods exported to the EU will be covered by 2034.

💡 More interesting news:

• EU governments have agreed to ban the destruction of unsold textiles as part of the bloc's efforts to reduce waste through reuse and recycling. Textile consumption in Europe has the fourth highest impact on the environment and climate change, with 5.8 million tonnes of textiles discarded annually in the EU. The new law would also create a "digital product passport" to show a product's environmental sustainability. Medium-sized companies would have a four-year transition period, while the smallest companies would be exempt. 🇪🇺

• Paris plans to ban single-use plastic during the 2024 Olympic Games in an effort to combat global plastic pollution. Visitors to Olympic sites will not be allowed to bring plastic bottles, and Coca-Cola will distribute its products in reusable glass bottles and soda fountains. The Paris Olympics aims to halve the carbon footprint compared to previous games and is part of a global effort to reduce plastic pollution, with the UN Environment Programme issuing a report on policy options to reduce plastic waste by 80% by 2040. 🟢

• Global revenues from carbon taxes and Emissions Trading Systems (ETS) have reached a record high of $95 billion, covering almost a quarter of global greenhouse gas emissions, according to the World Bank's "State and Trends of Carbon Pricing" report. While uptake of ETS and carbon taxes is increasing in emerging economies, high-income countries still dominate. Carbon pricing is an important tool to raise revenue, direct international financial flows, and drive innovation, and can help deliver on broader sustainability and development goals, according to World Bank. 🌎

• Lloyd's became the sixth insurer to leave the Net-Zero Insurance Alliance (NZIA) within 36 hours, following accusations from U.S. Republican attorneys general that insurers are violating antitrust laws. The NZIA has lost a fifth of its members in a week, raising questions about the viability of the coalition, which requires insurers to commit to reducing greenhouse gas emissions in their underwriting portfolios to a net-zero level by 2050. The exodus has left NZIA with 21 members, many of them smaller insurance firms. The U.N.-backed Glasgow Financial Alliance for Net Zero (GFANZ) warned about the fallout of "political attacks" on insurers in the United States and is expected to speak with remaining NZIA members individually. 👀

• Greenpeace has warned that recycling plastic can make it more toxic and should not be considered a solution to the pollution crisis. A report by the global environmental network shows that recycled plastics are more toxic than their virgin constituents. The report comes as separate research has found breaking down plastics for recycling scatters microplastic pollution into the environment. Greenpeace said any global plastics treaty must achieve immediate significant reductions in plastic production, as a first step on a pathway to the total elimination of the manufacture of virgin plastic. ⛔️

🧐 What are companies doing?

• Hyundai Motor Group and LG Energy Solution will build a $4.3 billion EV battery plant in Georgia, US, with an annual production capacity of 30 GWh, enough for 300,000 EVs. The plant will start production at the end of 2025 at the earliest and will be owned 50-50 by LGES and Hyundai. The move is aimed at taking advantage of tax credits and complying with new US sourcing requirements for EV battery components and critical minerals. Hyundai and Kia vehicles are currently not eligible for the tax credits. 🚙

• JPMorgan Chase has announced a series of deals aimed at removing and storing 800,000 metric tons of carbon dioxide from the atmosphere, valued at over $200 million, marking one of the largest carbon dioxide removal purchases to date. The agreements are expected to enable JPMorgan to match its entire unabated direct operational emissions footprint by 2030, while also helping accelerate the development of carbon removal technologies and support scaling up carbon removal projects. 🟢

• Ford has agreed with Tesla to allow its electric vehicle owners to access more than 12,000 Tesla Superchargers in North America in early 2024, making Ford the first major automaker to embrace Tesla's proprietary charging standard. A Tesla-developed adapter will provide Ford EVs with the Combined Charging System (CCS) port access to Tesla's V3 Superchargers, and Ford will equip future EVs with Tesla's own charging standard starting in 2025. 🚙

• FedEx has launched a new tool called FedEx Sustainability Insights that allows shippers to access estimated carbon emissions data of shipments at the package and account level. The tool calculates greenhouse gas emissions using a methodology that follows the WRI’s Greenhouse Gas Protocol and includes industry-standard emission factors, utilities, and transportation-specific operational metrics. The platform can help customers target eco-conscious consumers, provide information about the environmental impact of purchases, and create emissions reports for stakeholders and regulatory organizations. 🟢

• Uber is launching Uber Green in some cities in India in June 2023, allowing passengers to request all-electric, zero-emission vehicles. Uber is also expanding its network of fleet partners, partnering with Zypp Electric to deploy 10,000 electric two-wheelers by 2024, signing an MoU with India's largest Small Industries Development Bank of India to make low-interest loans available to fleet partners, and bringing its global mobility agreement with BP pulse to India in partnership with JioBP for fast-charging Uber EVs. Uber aims to electrify every ride on its platform by 2040 and has tripled the number of electric vehicles on the platform, with 31 million unique riders taking a ride in an electric vehicle in 2022. 🚙

• Nike has launched the H₂ Barge 1, the first-ever hydrogen-powered inland container ship, which will transport products for Europe while producing zero operational CO2 emissions. The barge, retrofitted with hydrogen technology, will reduce CO2 emissions annually by 2,000 tons and forms part of Nike's efforts to address the carbon footprint of its logistics operations and achieve its 2025 sustainability goals. ⛴️

• Schroders Greencoat and Carlton Power have formed a new joint venture, Green Hydrogen Energy Company, aimed at developing green hydrogen projects in the UK. The companies aim to build a project portfolio reaching 500 MW by 2030, with a £200 million commitment to the partnership from funds managed by Schroders Greencoat. Hydrogen is viewed as a key building block of the transition to a cleaner energy future, particularly for sectors with difficult-to-abate emissions. The UK has unveiled plans to reach 10 GW of low hydrogen production capacity by 2030 and launched a Hydrogen Strategy in 2021. 🟢

👀 Where is cash flowing?

🌎 Hamilton Lane has raised over $850 million for its sustainable investment platform, including $370 million for its social and environmental impact-focused fund, Impact Fund II. The fund has made nine investments to date, primarily targeting growth investments leveraging transformative technologies, innovation, and efficiency across themes including smart and efficient cities, online workforce training and education, and clean energy transition.

⭐️ Montreal-based Novisto has raised $20 million in a Series-B funding round led by Inovia Capital, with participation from new investors Portage Ventures and SCOR Ventures, and existing investors White Star Capital and Diagram Ventures. The ESG data management software provider plans to use the funds to accelerate product development, expand its customer base, and grow its team globally to meet the increasing demand for ESG data management solutions.

🌏 Mitiga Solutions, a climate tech startup based in Barcelona, has raised $14.4 million in a Series A funding round led by Kibo Ventures, with participation from Microsoft Climate Innovation Fund, Nationwide Ventures, Faber Ventures, and CREAS Impacto. The company uses data-heavy, physics-based risk modeling tools to predict climate-driven risks such as wildfires, extreme weather, and volcanic eruptions, applying high-performance compute-driven risk modeling augmented with AI.

🍀 Undo, a startup that accelerates the natural rock weathering process to remove carbon, has raised $12 million in its first institutional round led by Lowercarbon Capital. Undo spreads basalt rock "dust" on agricultural lands to absorb CO2, curb ocean acidification, and boost soil health. The process takes hundreds of thousands of years in nature, but Undo accelerates it with a powdered form of the rock, bringing it down to years. The startup makes money by selling carbon removal credits and is backed by Microsoft and Stripe. Undo will use the funds to scale up operations.

🟢 Better Nature, a UK tempeh producer, has launched a £3 million Series A funding round to expand into retailers and food service providers throughout the UK and Europe. The brand will launch at over 400 Tesco stores on June 1, marking its first UK supermarket listing, and plans to expand into more European countries and the US by 2025. Tempeh is growing in popularity as consumers demand healthier and less processed meat alternatives, and Better Nature plans to create further mainstream appeal by developing new products such as burgers, falafels, and veggie balls.

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

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