What's Happening in Sustainability & ESG (Week Recap 02.04 - 08.04) 🌎

Today’s newsletter is brought to you by Skilledin Green, the nexus of the Professional Sustainability Network on the Green Future of Work platform.

This week’s read time: 8 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. 🍀

In this edition, we’ll cover:

• The US SEC has paused the new climate-related disclosure rules 🇺🇸

• The European Court of Human Rights will rule on three climate cases, determining if government inaction on climate change violates human rights ⚖️

• The US Federal Reserve blocked a proposal to make climate risk a focus of financial rules 🏦

• A group of 57 companies were responsible for 80% of the world's CO2 emissions from 2016 to 2022 🔴

• Three major banks will disclose a new climate metric, revealing their ratio of financing for low-carbon energy projects compared to fossil fuel projects 🏦

• and other news 🌍

THE WEEK’S TOP NEWS

Regulatory Oversight & Industry Insights

🇺🇸 The US Securities and Exchange Commission (SEC) has paused new climate-related disclosure requirements pending judicial review, following criticism and multiple lawsuits. The rules, which set standards for companies to communicate with investors about climate-related risks, have been challenged by Republican-led states, energy companies, and business groups for overstepping the SEC's mandate, while environmental groups argue the rules do not go far enough. The SEC declared that it will continue defending the rules, citing their consistency with applicable law and the agency's authority.

🇺🇸 In other news, the US Federal Reserve has reportedly blocked a proposal by the Basel Committee on Banking Supervision to make climate risk a focus of financial rules. The proposal suggested that banks should publish detailed information about the impact of climate change on their business from January 2026. The European Central Bank also supports further proposals for lenders to disclose their strategies to meet climate commitments. However, US officials and companies have resisted these proposals, citing concerns of overstepping and prioritizing political objectives over financial regulation.

⚖️ The European Court of Human Rights is set to rule on three separate climate cases, marking the first time it will decide if government inaction on climate change violates human rights. The cases include Portuguese youths suing 32 European countries for failing to prevent climate change, elderly Swiss women arguing their government's inadequate climate efforts put them at risk, and a former French mayor challenging France's refusal to adopt more ambitious climate measures. If the court rules in favor of three cases claiming rights breaches, individuals could seek redress and compensation if their governments fail to take sufficient climate change prevention measures.

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MORE INTERESTING NEWS

Latest developments, reports, insights, and trends

🔴 A group of 57 fossil fuel and cement producers, including nation-states, state-owned firms, and investor-owned companies, were responsible for 80% of the world's CO2 emissions from 2016 to 2022, according to a report by InfluenceMap. The top three emitters were Saudi Aramco, Gazprom, and Coal India. The report also found that most of these companies expanded their fossil fuel production since the signing of the UN Paris Agreement in 2015, despite commitments to curb climate change.

🇺🇸 The Biden administration has awarded $20 billion in grants for clean energy and transportation projects in disadvantaged US communities. The selected organizations that will manage the grants will create a national clean financing network expected to reduce or avoid up to 40 million metric tons of climate pollution annually. The Biden Administration has also selected over 100 projects to receive $4 billion in tax credits. Two-thirds of the new tax credits have been allocated to clean energy manufacturing and recycling projects, with $800 million for critical materials recycling and processing, and $500 million for industrial decarbonization projects across various sectors.

🏦 Citigroup, JPMorgan, and Royal Bank of Canada (RBC) will disclose a new climate metric, revealing their ratio of financing for low-carbon energy projects compared to fossil fuel projects. This disclosure comes as part of an agreement with New York City Comptroller Brad Lander. The move is expected to provide investors with a better understanding of the banks' commitment to climate-friendly projects. The banks' reports will cover their equity and debt underwriting, syndicated lending, and project finance.

⚡️ CO2 emissions regulated under the EU’s emissions trading system (ETS) fell by a record 15.5% in 2023 due to a surge in renewable power output. The power sector saw a 24% drop in emissions, primarily due to increased wind and solar electricity production. Industrial emissions fell by approximately 7% due to reduced output and energy efficiency gains. However, aviation industry emissions increased by around 10% following a rebound in traffic after the COVID-19 pandemic.

WHAT ARE COMPANIES DOING?

Corporate sustainability, new tools and services & companies in the news

📄 ESGgo has launched an AI-powered solution, One-Click Sustainability Report, to help companies produce sustainability reports in line with regulatory frameworks and stakeholder requirements. The solution streamlines sustainability reporting processes, ensures compliance with evolving standards, and supports the processing of various data types for tailored reports. It includes seven report templates to cater to different use cases and requirements.

📈 EY has launched a Sustainable Finance Innovation Hub in Dublin to support global financial institutions in meeting their ESG regulatory and reporting requirements. The hub will expand with 40 specialists in ESG fields, and will also include sustainability experts from Europe, Asia-Pacific, and the US. The hub aims to help clients remain compliant with evolving regulations, and provide advice on ESG reporting.

🛩️ Solarig, a clean energy developer, plans to build a new sustainable aviation fuel (SAF) plant in Spain, with an expected investment of $847 million. The plant, which will produce 60,000 metric tons of SAF annually, is part of efforts to decarbonize the aviation industry. The facility will utilize renewable energy sources and is expected to capture and use 140,000 tons of CO2 and reduce 170,000 tons of CO2 per year.

♻️ Phillips 66 has converted its San Francisco oil refinery into a facility that processes only renewable feedstocks, producing approximately 30,000 barrels per day of renewable diesel. The company plans to increase production to 800 million gallons per year of renewable transportation fuels, including renewable diesel, gasoline, and sustainable aviation fuels.

🟢 U.S. Steel and CarbonFree are launching a project to capture 50,000 metric tons of CO2 annually at a steel mill in Indiana. This will be the first commercial-scale carbon capture utilization plant at a steel plant in North America. The project also marks the first step in exploring the scalability of the technology for future implementation at U.S. Steel.

🚙 The IKEA Foundation is investing $100 million in the Leapfrogging Partnership, a project aimed at advancing decarbonized road transportation in emerging markets. The partnership will focus on increasing access to clean, affordable zero-emissions vehicles, particularly in Southeast Asia, Africa, and Latin America.

EVERYTHING FINANCE

Funding rounds, sustainable finance, acquisitions & private equity deals

📈 UBS Asset Management has launched the S&P 500 Climate Transition ESG UCITS ETF, the first ETF to track a climate transition index based on the S&P 500 universe. Listed across European exchanges, the fund aligns with net zero and improved ESG profiles. It adheres to the EU’s Climate Transition Benchmark label, ensuring alignment with a 1.5ºC warming trajectory and incorporating significant emissions reductions.

📈 Bloomberg has launched the Bloomberg Government Climate Tilted Bond Indices, a new series of government bond benchmarks that increase weightings on countries incorporating climate transition objectives. The new series includes 14 indices, including global, Eurozone, and emerging markets benchmarks. The indices use Bloomberg Government Climate Scores to adjust country weights and aim to balance climate change risk and opportunity considerations while maintaining accurate market liquidity and concentration risk benchmarks.

⚡️ Morgan Stanley Capital Partners (MSCP) has acquired Resource Innovations, a company that provides services and solutions focused on energy efficiency and sustainability. Resource Innovations works with various organizations to help meet their energy transition and decarbonization goals.

🔋 Alsym™ Energy, a developer of next-generation non-flammable rechargeable batteries, has raised $78 million. Alsym's first product, Alsym Green, offers higher energy density than other non-flammable, non-lithium battery chemistries and can operate at elevated temperatures, making it suitable for stationary and grid storage in situations where fire risk increases.

🟢 ION Clean Energy, a carbon capture technology provider, has raised $45 million in a funding round led by Chevron New Energies and Carbon Direct Capital. ION's technology reduces the cost of post-combustion CO2 capture, making it a more viable solution for hard-to-abate emissions.

🟢 Climate solutions startup Windfall Bio has raised $28 million in a Series A funding round to commercialize its solution for capturing and utilizing methane from emissions-intensive industries. The company's technology uses naturally occurring soil microbes to transform methane emissions into organic fertilizer.

📊 Environmental data provider Iceberg Data Lab (IDL) has raised $10 million in the first close of its Series A funding round to support expansion and product enhancement. IDL provides data solutions for financial institutions to measure environmental metrics, such as the carbon and biodiversity footprints of portfolio companies.

♻️ Cleantech startup Terragia Biofuel has raised $6 million in seed funding to further its technology for converting biomass into ethanol. The company's innovative process uses thermophilic microorganisms, reducing the high costs associated with conventional biofuel production.

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