April Cleantech Roundup: Tech Climate Commitments | What is Climate Tech? | A Tale of Two EV markets | Do Investors Care About ESG?
Clean Energy Trust’s cleantech roundup highlights interesting cleantech news and perspective, across industry, technology, policy, and investing.
Tech companies are investing in land restoration as part of their climate commitments. These examples from Amazon and Microsoft offer a taste of long term thinking and planning — while some of this is PR, some of it is a recognition that to get to net-zero emissions (or to offset legacy emissions in the case of Microsoft), eventually investments have to grow beyond just switching to zero-carbon electricity. Also, where tech leads, other companies are likely to eventually follow. Microsoft is setting the gold standard here. Of course, it is a lot easier for a software company to do this than someone who has been smelting aluminum for a century, but serves as an important guidepost for other companies going forward. Amazon Link. Microsoft Link
Climate Tech: this is the new sound, just like the old sound. Over at GreenBiz, Heather Clancy has a long-form piece that attempts to explain what the climate tech space is. I found this to be a well researched and written article, but a totally confounding exercise. After all, climate tech is just new branding for the cleantech space, which itself was branding around a set of sectors that are united more by their goals than by their industry characteristics.
Heather does mention in her piece that it is partially a branding exercise, but goes on to quote people trying to explain how climate tech is different. Let me know when someone figures that out!
Some argue that solutions that directly address climate change are the differentiating factor. But everything in the cleantech space does that, too. Also, when it comes to motivation, essentially everyone who was involved in cleantech was there because of the climate.
This is not a criticism of the climate tech brand of course — I’m in favor of whatever is effective, especially for the purposes of venture funds raising money from limited partners. I just think disentangling climate tech and cleantech is creating a distinction without a difference.
So, the next time someone discusses the climate tech space, ask them to cite specific examples that are “climate tech” but not “cleantech” — and please let me know what they are. Link
A number of headlines on transportation electrification: shrinking near-term prospects for passenger EVs alongside a lot of activity and optimism in the commercial fleet EV space:
Ford has canceled the partnership with Rivian to develop an all-electric Lincoln branded SUV. One thing to keep an eye on — how much does the economic downturn force auto manufacturers from pivoting to focus on the future with EVs? I would imagine companies who have longer running and deeper commitments to EV development will end up faring better, as their R&D efforts will be seen as less speculative and more core to the business (GM, Volkswagon, Volvo, etc…). That said, it’s not like every automaker is not going to transition to EVs eventually, it is just a matter of timing and execution. Link
Indeed, the EV wave is still coming, albeit a little behind schedule — Katie Fehrenbacher at GreenBiz explains why. Despite the slowdown, if countries are forward-looking as they help re-assemble their economies, smart policies and investments could actually accelerate the transition. Link
Of note, New Jersey is prioritizing transportation electrification with the funds the state receives from the regional carbon pricing system in the Northeastern US (RGGI). Link
Meanwhile, startup company Amply raised a $13 million Series A round — Amply is one of several companies offering commercial fleet charging management as a service (eIQ Mobility is another). Link
Also, a coalition of entities is proposing a $150 billion electrification infrastructure initiative to Congress. A number of worthwhile suggestions in here. Link
How much do people care about ESG? Last month Matt Levine at Bloomberg highlighted research that suggests that what people care about is to have the ESG label, along with good returns, regardless of whether that ESG label really means anything. It is not a terribly surprising outcome, but an important finding when we think about impact investing and how capital ends up getting allocated. People like impact, but what they really like is to get a market return and feel like they are making an impact. Link
Tesla shared that demand for energy storage is outstripping their supply. It will be interesting to see how the convergence of California’s wildfire issues (and related public safety power shutoffs) and sheltering in place for the coronavirus pandemic end up changing consumer attitudes about the value of resilience and home energy storage systems. Assuming there is interest, residential solar providers have a golden opportunity to cross-sell storage to their existing customers. Link
Some new transmission is being developed, but not nearly at the pace we need to complement a carbon-free generation sector. Greentech Media highlighted a number of projects that have made significant progress. Unfortunately, the balkanized and legacy approach to regulating the grid and approving transmission projects means even modest and extremely beneficial projects take approximately forever. I worked on transmission development at the U.S. Department of Energy in 2012, and almost all of these projects were being developed at the time.
This is definitely an area where we need significant change in the way we review and approve projects. A major rub is that these are multi-state projects, but are regulated at the state level, so they end up being analyzed from a single state perspective, which doesn’t make a lot of sense. If you’re interested in this topic, I suggest Russell Gold’s book Superpower, which I’m reading currently. Link
Evergreen Action Plan: the team that worked on climate action strategy for Jay Inslee’s Presidential campaign has spun it out into an open-source plan that can be reviewed, tweaked, and adopted. The plan drew strong universal praise for its depth and breadth, and can be a great roadmap for the future. Long term, I think Jay Inslee will end up as one of the most influential Presidential candidates that effectively no one voted for, due to his focus and detailed work on climate action strategy. Link
Other news:
The energy transition marches on — in 2019, the vast majority of new energy projects around the globe were renewable. Also, as a reminder of where things are being built these days, more than half of this renewable capacity was in Asia. Link
Wind is now the largest source of electricity in Iowa and Kansas. Strong wind potential + federal tax credits + medium-sized population centers = lots of development. Link
Amy Francetic at Buoyant Ventures discusses how to flatten the climate change curve. Link
Toyota and BYD announced a partnership to develop commercial electric vehicles. Link
BP Ventures led Freewire’s $15 million Series A round. Freewire makes mobile fast chargers for EVs. Link
Bloomberg developed a handy easy-to-use climate action simulator that makes it easy to see the emissions reduction impacts of different policies. Link
