FEBRUARY 21, 2024

Hello!

From her Parisan travels last week, Anca profiles the International Energy Agency and its leader, Fatih Birol, in a story chock full of exclusive information.

Although every word of the roughly 1,700-word story is worth reading, we know we’re all short on time, so we've highlighted key parts below (one way we’re experimenting with lengths — let us know what you think by replying to this email).

In our latest Data Dive, I chart hot-off-the-presses electric-vehicle sales numbers.

 
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Fatih Birol, executive director of the International Energy Agency. Photo provided by the IEA.

As climate ‘referee,’ IEA chief faces scrutiny 

BY: ANCA GURZU

PARIS — Flanked by his staff, Fatih Birol strides briskly along a narrow hallway before rushing into a nondescript conference room to a meeting he’s late for.

Along the way, the 65-year-old silver-haired Turkish economist passes an exhibit with photos of oil drilling, gas pipelines, enormous wind turbines, electrolyzers and fast-speed trains.

The display aptly depicts the fundamental transformation both the world and the organization Birol is leading, the International Energy Agency (IEA), have embarked on in recent years: the world in how it sources its energy needs; the IEA in how it does its job — and, more contentiously, how the latter can nudge the greening of the former.

Supporters applaud the IEA’s increased focus on how to tackle climate change, arguing the organization’s metamorphosis is in line with the changing needs of its members and of society at large. Critics, however, argue the IEA — through its messaging and assumptions — has strayed from its path, sliding toward unhelpful climate advocacy.

“It is true that we went through a transformation… but this doesn't mean that we forget energy security,” Birol told Cipher in an interview on the sidelines of the IEA’s 50th anniversary event in Paris last week. “It is like when you ask the kids when they are young ‘do you love your father or mother more?’ We love both of them. We address both energy security and climate change, and this can happen at the same time.”

Click here to read the rest of an equal parts provocative and informative article from Anca.

For those with no time to spare, here are our highlights:

Changing times

The IEA, an intergovernmental organization, was founded by richer nations in 1974 as an energy security watchdog following the 1970s oil crisis. Today, the IEA also puts out reports on how countries can reach net-zero emissions by 2050, boost renewables and source critical raw materials needed for cleantech. Its work lands on the desks of prime ministers, CEOs and fund managers, and is considered the gold standard for policy planning.

The drive and dedication of Birol, a Turkish economist, has helped put the IEA on the map, many officials Cipher spoke to on and off the record said.

“Can you tell me the name of any other IEA director before him?” asked a European diplomat who participated in the Paris event and who asked to remain unnamed to speak candidly.

John Kerry, the United States’ top climate diplomat, touted Birol’s “extraordinary job,” adding in a speech at the same event that the IEA “is now probably the principal arbiter or referee about many of the things we need to be thinking about with respect to our policies." 

Fossil pushback

Birol’s climate moves have also rankled some key energy players.

Just days before the 28th annual United Nations Conference of the Parties in the United Arab Emirates last year, Birol told the oil and gas industry it is “facing a moment of truth” about the role it plays in addressing climate change.

In a sharp response four days later, the Organization of Oil Producing Countries (OPEC) said the IEA’s messaging “unjustly vilifies the industry,” describing its messaging as “undiplomatic to say the least.”

Birol dismissed the idea that there was an exchange of words with the oil cartel.

“We never responded to anybody directly,” he said calmly. “We have taken with great honesty the criticism… even from a very small part of the international community.”

That criticism has been mounting lately, especially after the IEA forecasted last year demand for all fossil fuels will peak by 2030.

OPEC isn’t Birol’s only critic.

The IEA has “strayed from its security mission and it has become a lap poodle for climate zealots,” Bob McNally, an energy consultant who served as a special assistant to George W. Bush, told Cipher in an interview.

Click here to go deep on McNally’s concerns about the IEA — and the agency’s response.

Lunchtime Reads and Hot Takes

Green Product Makers Struggle to Sell to US City and State Governments — Bloomberg
Cat’s take: Key quote, and a big problem: “The procurement process has become so cumbersome, so byzantine, that only the most powerful projects with political support can move forward."

Von der Leyen’s 2nd-term pitch: More military might, less climate talk — POLITICO
Anca’s take: The lede (which is great) says it all: "Behold Ursula von der Leyen’s transformation from green dove to military hawk." The focus is now on defense and industry; climate change was not front and center.

Paris’s New Weapons in Climate Fight Are Metro Turnstiles and the Seine — Bloomberg
Bill’s take: This won’t do much to solve climate change on its own, to say the least, but it does provide a reminder for each rider of the sort of innovative thinking that’s needed for the energy transition.

The Great Salt Lake Is Full of Lithium. A Startup Wants to Harvest It. — The Wall Street Journal
Amy’s take: I learned a lot on this topic, which I know relatively little about compared to other climate tech. Speeding up any process from taking eight months to mere hours has got to have massive implications.

Florida Keys coral reefs devastated by 2023 heat wave — Axios
Amena’s take: With corals serving as shelters for over 25% of ocean animals and as major drivers of fishing and tourism revenue, these findings are a wake-up call for climate action.

World’s biggest solar company warns west not to cut out Chinese suppliers — Financial Times (subscription) 
Anca’s take: It might not be what European and American leaders wants to hear, but the warning is at the core of a bigger debate: cutting dependency on China comes with higher costs and slower climate ambition.

Sage Geosystems raises $17M for geothermal energy storage — Canary Media
Cat’s take: Sage Geosystems touts its "battery" to balance the intermittent nature of wind and solar, and this energy storage strategy does not depend on critical minerals like other battery technologies.

The energy transition would cost 20% more without China, analysis says — Quartz
Amy’s take: I’m surprised it’s not a bigger number! I wonder how they arrived at such conclusions. Looks like we’re now embarking on a “China-lite” approach.

JPMorgan and State Street quit climate group as BlackRock scales back — Financial Times (subscription) 
Bill’s take: The moves, which each company took independently, are part of a broader walk-back by asset managers from publicly pushing companies to decarbonize.

More of what we're reading:

• Biden Administration Is Said to Slow Early Stage of Shift to Electric Cars — The New York Times
• Promising ‘low-carbon future,’ mining company to pump $2 billion into Arizona zinc mine — Arizona Republic

Amid news of slowdown, electric car sales set to keep growing

Source: Clean Investment in 2023: Assessing Progress in Electricity and Transport, Rhodium Group/MIT-CEEPR Clean Investment Monitor, Energy Innovation, REPEAT Project.

BY: AMY HARDER

You wouldn’t know it by reading the latest news headlines, but electric-car sales grew at a rapid clip in the United States last year and are set to keep growing in the years ahead, according to new research out today by a consortium of academic, research and consulting organizations.

The projections come amid a slew of news stories in recent months documenting the slowdown in electric-vehicle sales, such as this article by The Wall Street Journal last week with the headline: “The Six Months That Short-Circuited the Electric-Vehicle Revolution.”

Electric cars — the most recognizable technology of the energy transition — offer a window into the ups and downs all types of climate technologies will face in the years and decades to come. Buckle up, because we’ll be seeing a lot of these types of cycles as new tech commercializes.

The research (authors listed below) found sales in 2023 came in near the top end of the range of projected sales for the year, fueled by the 2022 Inflation Reduction Act. The law gives consumers tax credits to buy a range of clean energy technologies, including electric cars.

Sales of zero-emission vehicles — defined as fully electric, plug-in hybrid and fuel cell — are likely to fall this year from the more than 50% growth experienced in 2023, the report says. But the authors find such large growth rates were “neither expected to occur as a result of the IRA, nor is it required to achieve” the law’s goal of reducing net greenhouse gas emissions in the U.S. by 40% by 2030.

Put simply, while sales are not expected to keep growing as dramatically, both the report’s high and low projections for the coming years show ranges of growth, as opposed to actual declines. (And indeed, the Biden administration may be easing regulations that would have required a faster growth, The New York Times reported last week.)

The report is by Princeton University’s REPEAT Project, the Clean Investment Monitor (a database by research firm Rhodium Group and Massachusetts Institute of Technology’s Center for Energy and Environmental Policy Research) and policy firm Energy Innovation.

Check out Cipher’s Cleantech Tracker, which also draws from the Clean Investment Monitor.

AND FINALLY...
Seaside solar sunrise

Cipher reader Rick Robbins snapped this photo of the rooftop solar system on his home in Ecuador at sunrise. The system kept his power on during rotating cuts to grid power in January. “We didn’t even notice the power disruption,” he said.

Editor’s note: In addition to supporting Cipher, Breakthrough Energy also supports and partners with a range of entities working to tackle climate change, including nonprofits, corporations, startups and research firms. For more information on Cipher’s editorial policy, click here.