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š± Weekly Debrief: Big Oil's Comeback š¢
Weekly debrief for 2/22/23
Happy Thursday!
Today Iām experimenting with another debrief on the latest news and insights across business, tech, and policy. Iād love to know what you think - send feedback to [email protected].
This weekās must-reads include:
US housing market overvalued by billions due to flood risk
European energy crisis proved to be catalyst for clean energy
An inside look at the software running Sunrun
Thanks for reading!
š BIG BUSINESS
Image Source: Unsplash
The six largest western oil companies earned a record $200b profit in 2022. This has led to accusations of war profiteering and sparked outrage among those concerned about the climate crisis. Despite pressure to reduce production, politicians have called on oil companies to increase output or help find replacements for Russian fossil fuels following the invasion of Ukraine. ExxonMobil, which has resisted decarbonization more than other energy majors, saw its shares rise 50% and earned $55.7b in profits. This resurgence in hydrocarbon demand and profits raises doubts about whether legacy industries and their investors will drive decarbonization.
Hot take: While oil & gas have the cash reserves and deployment expertise to drive renewable energy forward, theyāre incentivized to uphold the status quo. It was easy to champion climate goals when oil prices were literally negative. Not so much anymore.
A new report published in the journal Nature Climate Change estimates that US homes in flood-prone areas may be overvalued by up to $237 billion due to insufficient pricing of flood risks. Overvaluation is particularly significant in counties along the coasts, where disclosure of flood risk is not required in real estate transactions. Lower-income households are at greater risk of losing a larger share of home value due to inadequate pricing of flood risks. The report highlights the need for better communication of flood risk to property owners and for policy choices to address the cost of climate change.
GenZ EV Solutions and Subway are partnering to pilot Subway EV Charging Oasis parks at select restaurants. The Oasis parks will include multiple charge ports, picnic tables, playgrounds, WiFi, and green space to allow customers to relax while their EVs charge in as little as 10 minutes using ADS-Tec Energy's battery-buffered fast charging equipment. The partnership aims to offer added convenience for customers, provide an environmental benefit, and create an additional revenue source for franchisee partners.
Ikea aims to decrease greenhouse gas emissions by making changes to its materials strategy while using mostly renewable energy for its operations. The company has reduced its emissions by 5% from the previous year and by 12% from 2016. Its goal is to achieve a 15% reduction by 2030. Materials-related emissions are the largest share of Ikea's climate footprint. The company aims to become "climate positive" by reducing its total climate footprint, using only renewable or recycled materials by 2030, and achieving zero-emission transport for all home deliveries by 2025. Ikea has faced criticism over its wood consumption and practices in the past.
š POLICY & SOCIETY
The U.S. Inflation Reduction Act allows renewable energy developers to sell clean-energy tax credits, creating a new market for tradable tax credits. This will unlock tens of billions of dollars in financing for solar, wind, and battery farms, particularly mid-sized projects. Climate tech startups are emerging to act as marketplaces connecting sellers and buyers of tax credits. This new method of financing could help speed up progress toward decarbonizing the electricity grid and also provide companies with a way to get a tax break while promoting sustainability.
Europe was expected to face an energy crisis due to fears of gas shortages and high prices. However, despite significant spikes in energy prices, the continent managed to avoid blackouts and significant mortality from the cold. Additionally, Europe has managed to "turbocharge the green transition," with wind and solar power generating more electricity than gas and coal for the first time in 2022. Europe is set to cut its fossil fuel use by a record 20% next year. This demonstrates that energy transitions can move quickly with political commitment and social buy-in, as seen in the willing conservation by the public.
J.D. Power's ongoing study found that the unreliability of public EV charging stations is frustrating drivers, with 21% of charging attempts failing, a 50% increase from 2021. The high failure rate is due to malfunctioning or out-of-service chargers, and the situation is worse in high-density urban areas and states with higher numbers of EVs. While there are over 53,000 public charging stations in the US, the rate of EV adoption is outpacing the installation of charging stations. With the influx of investment in charging infrastructure, there are concerns about the quality of new chargers, which has resulted in a frenzy of mergers and acquisitions. Tesla Destination and Tesla Supercharger were ranked highest in satisfaction among Level 2 and DC fast chargers.
Despite ample winter water supply breaking California's record for driest three-year stretch, state water officials are increasingly responsible for floodwater going unused. California's strict water regulations protect downstream residents' rights to take water from streams and creeks. During recent storms, some water districts were only allowed to take floodwater as the rain ended, while others couldn't take any. Vineyards in Sonoma County are working on a multimillion-dollar system to collect stormwater and distribute it to growers' fields, but they need to convince cautious California officials that rerouting floodwater won't deprive downstream residents. While the state hopes that capturing stormwater will help meet the enormous need for water, approved pilot projects have captured only a small fraction of their potential.
Recent acts like the Infrastructure Investment and Jobs Act, Inflation Reduction Act, and CHIPS and Science Act champion expanding domestic semiconductor manufacturing in the US. The CHIPS and Science Act appropriates $39 billion to build U.S. fabrication plants. However, meeting employer demand and benefiting local workers requires national, state, and local actions to expand, train, and diversify regional workforces. Building new semiconductor plants alone won't create accessible pathways, and regions must build stronger employer-education-government links.
š TECH & STARTUPS
Virtual power plants (VPPs) are formed by combining home energy devices like rooftop solar systems, backup batteries, electric-vehicle chargers, and smart thermostats and appliances. Turning these into reliable power grid resources is a complex task that can take decades to perfect. However, software is being developed to manage VPPs. The Gridshare software developed by UK-based startup Moixa, now owned by Lunar Energy, manages tens of thousands of battery-equipped homes in Japan and Europe. Lunar Energy is partnering with Sunrun, a US-based residential solar and battery company, to deploy the software in the US. Sunrunās VPPs have maintained 100% performance and uptime through the test period. VPPsā software optimizes the maximum savings for the customer in their home, while also enabling the most amount of energy for delivery of grid services.
Uber Freight has partnered with WattEV to launch its first zero-emission electric truck pilot in Southern California, with plans to expand nationwide. The pilot program aims to advance zero-emission freight transportation, and global supply chain solutions company CHEP will be the first shipper to participate. The collaboration will use WattEV's electric heavy-duty transportation platform, and the company is also developing a nationwide network of heavy-duty electric charging solutions. The pilot will provide valuable insights for cutting emissions from freight transportation, which accounts for a significant portion of transportation-related greenhouse gas emissions in the US.
Terraset, a new non-profit, has emerged to help channel private philanthropy into carbon dioxide removal services to bring down their cost and achieve net zero by mid-century. The non-profit plans to fund the most promising carbon removal startups that need capital to scale, using annual donations from its donors, which already include investor Tim Ferriss and Segment co-founder Calvin French-Owen. Terraset has already funded Charm and Heirloom. Shashank Samala, the CEO and co-founder of Heirloom, commented that Terraset helps to āgalvanize individuals to play a small role in the world right now,ā which is necessary to reduce costs and spur innovation in the industry.
ChargerHelp! offers an app-based system to provide on-demand repairs and maintenance for EV charging stations, aiming to improve the industry-wide issue of unreliable charging stations. The company raised $17.5 million in a Series A funding round led by Blue Bear Capital, which will be used to develop their reliability software platform, expand their Reliability as a Service offering, and grow their workforce development program. ChargerHelp! claims to help their customers achieve the 97% uptime required by the new NEVI regulations for federally-funded public chargers, which is higher than the current industry standard.
š° FUNDING
Altus Power, the premier independent commercial-scale clean electrification company serving commercial, industrial, muni, and community solar customers, raised $293M in debt financing.
Zenobe Energy, the largest independent owner and operator of battery storage in the UK, raised Ā£235,000,000 in debt financing.
Ubreathe, a developer of a smart natural air purifier solution to solve air quality challenges in cities and buildings, raised ā¹15M in angel funding.
Planetarians, a food technology company, raised $6M in seed funding.
Cyclic Materials, provider of recycling services recovering rare earth elements, raised $3,600,000.
Paleo, a food ingredient company that develops ingredients for plant-based foods, making it taste, feel and look like real meat or fish, raised ā¬12,000,000 in Series A funding.
OnSiteIQ, a construction intelligence platform for real estate investors, raised $10,000,000 in Series A funding.
Ocean Rainforest, who offers a collection of premium fully-traceable seaweed products, mostly for food and cosmetic producers, raised $6,200,000 in Series A funding.
Next Hydrogen, a designer and manufacturer of hydrogen electrolyzers, raised $5,000,000 in grant funding.
Carbon Maps, a climate management platform for food industry, raised ā¬4,000,000 in pre-seed funding.
Greyparrot, the leading AI waste analytics platform for the circular economy, raised $1,600,000 in equity funding.
SeeSnap is a smart photo-based workflow app for streamlining communications between field and desk-based teams and getting paid faster, raised $500,000 in seed funding.
š COMMUNITY ROUNDUP
Good reads and listens from the climate community
Supporting 100,000 climate founders with New Energy Nexus & Third Derivative, Ep #40 via Invested In Climate with Jason Rissman, Danny Kennedy, & Elaine Hsieh
The State of Climate Tech ā22 via Net0
The Gordian Knot of Climate by Artur Lapinch
climatetechcareers.com and climatefounder.org by Jack Fritzinger & Schaffer Ochstein