FEBRUARY 7, 2024

Hello! We are thrilled to share that we've brought on Cat Clifford, formerly of CNBC.com, as Cipher’s new senior science and economics correspondent. Say hi: cat@ciphernews.com.

In today’s edition: Drawing on recent trips to India, Bill reports on the rise of electric 2- and 3-wheelers there, Anca shares breaking news on Europe’s power mix and a Voices author finds lessons in climate tech from rock climbing.

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A man drives an auto rickshaw in Rajasthan, India. Photo by Hadynyah via iStock.

In India, battery swapping fuels electric market for 2 and 3 wheels

BY: BILL SPINDLE

Electric car sales are skyrocketing in China, rising in Europe and getting started in the United States. But when it comes to using batteries to transform transportation and cut greenhouse gas emissions, India, with its fast-growing market for electrified motorcycles and auto rickshaws, is the hothouse of innovation.

Across the world’s most-populous country and a rapidly growing economy, companies are lowering the costs, and spurring sales, of two- and three-wheeled electric vehicles with battery swapping networks. These networks allow the vehicles to be sold separately from their power sources.

For buyers, be they individuals looking to get around or delivery companies building thousands of vehicle fleets, buying an electric motorcycle or auto rickshaw without the battery cuts the upfront cost in half. The fuel — electricity — is paid for as needed, just like paying for petrol for a combustion engine, but on a subscription plan and at a fraction of the price. Owners swap drained batteries for charged ones at kiosks in less time than it takes to fill a combustion-engine vehicle with gasoline.

Lower vehicle prices, in turn, are opening a vast new market for EVs in a country whose population of 1.4 billion is migrating into cities and reaching driving age at a rapid clip. A small segment of the population is graduating from bikes and motorcycles to cars — as has happened in many countries as their economies developed. Many more are reaching an age and gaining enough buying power to purchase or lease a motorized two-wheeler for the first time.

“You have 100 million people coming into this segment, and another 100 million people coming in the next segment,” said Chetan Maini, the founder and chief executive at Sun Mobility, a company that runs a fast-expanding battery swapping network in the country.

The battery swapping business models emerging in India are spreading across developing economies and could reshape how energy is used for transportation.

India is the world’s third-largest emitter of carbon dioxide and its vehicle market is still in its infancy. There are only 22 cars per thousand people, compared to 980 in the United States and 850 in the United Kingdom. Meanwhile, nearly half of Indian households already own a motorized two-wheeled vehicle, nearly all of them traditional combustion engines.

To be sure, most of India’s carbon emissions come from its coal-dominated power sector. But electric vehicles use energy so efficiently they may help reduce emissions even when charged with electricity from coal. And the country is ramping up clean sources of power, which over time could reduce coal use. EVs could also help clean up India’s chronic traditional air pollution, often the worst in the world.

The government aims to raise the share of electric vehicles to more than one-third of annual sales by 2035, and to 50% by 2070. Already about half of three-wheel auto rickshaws sold are electric models, while electric two-wheelers account for about 4% of sales and electric cars about 1%.

Achieving the government’s goals could help India reduce its projected energy demand 30% by 2050, according to the International Energy Agency. The country has a target of net-zero emissions by 2070.

Battery swapping in India has taken off in the past five years through a confluence of technological advances and social and economic forces. Batteries have improved as their costs have fallen dramatically. Meanwhile, India has furiously built digital infrastructure and Indians have snapped up smart phones, allowing even some of the lowest-income people to tap into digital networks.

The Covid pandemic marked a major shift, a transformation I saw firsthand while reporting there in 2022. The pandemic crippled India’s economy for more than a year, but it also supercharged last-mile delivery services as mom-and-pop grocery stands and giants like Amazon alike expanded during what was, for a time, the world’s strictest lockdown. Individual drivers and companies with vehicle fleets started using two- or three-wheelers to deliver everything from groceries to mattresses.

Read the full article on Cipher’s website.

Lunchtime Reads and Hot Takes

Avnos raises $36M to pull CO2 — and water — from the sky — Canary Media
Cat’s take: DAC is still nascent, but it's interesting to see Avnos get funding for hybrid tech that sucks both CO2 and water from the atmosphere. That could be especially appealing for drought-stricken regions.
 
EU recommends ambitious 2040 climate target, goes light on farming — Reuters
Anca’s take: The Commission wanted to play this politically safe in light of farmers' protests that turned destructive. But agriculture is unlikely to be spared once a binding legislative proposal comes out. (See our recent story on the EU’s balancing act.)
 
These Yoga Instructors Are Pressing Lululemon to Clean Up Its Supply Chain — Bloomberg
Amena’s take: This is a litmus test for companies like Lululemon and Patagonia claiming to be sustainable stewards: require clean energy use from its suppliers or be called out for greenwashing.
 
First China-built biomethanol ship aims to set sail in Q2 — Nikkei Asia
Bill’s take: This is an early indication the EU’s carbon border tax is altering global shipping at least a little bit, which is a good sign so early on. 
 
EPA weighs first permit for marine carbon dioxide removal — POLITICO (subscription)
Amena’s take: This study's outcome will have major implications because it considers how the ocean's natural ability to safely and effectively remove CO2 can be sped up while maintaining its fragile chemistry.
 
Do socially disruptive climate protests actually work? — Energy Monitor
Amy’s take: This article has a lot of interesting terms to describe concepts we may be familiar with but don't know the names of, like “radical flank effect.” Click to learn!
 
Can We Fly Around the World Without Worsening Climate Change? — On Thin Ice
Bill’s take: Climber Alex Honnold and an Icelandic energy entrepreneur chew over the ethics of flying and breakthroughs in sustainable aviation fuels in debut episode of a new climate podcast. On Thin Ice offers a great discussion of climate solutions from a human perspective. 
 
Germany outlines $17 bln plan to subsidize gas-to-hydrogen shift — Reuters
Anca’s take: In the grand scheme of the clean energy transition, this is a nice example of policy trying to shift things on the ground.
 
Should power plants burn clean hydrogen to make electricity? — Canary Media
Amy’s take: This raises so many thorny issues! It’s worth the (long and wonky) read as this debate is sure to intensify.

More of what we're reading:

• Wind power giants give bleak view of 2024 as challenges persist — Reuters

• Could a Giant Parasol in Outer Space Help Solve the Climate Crisis? — The New York Times

 

Let’s build an apprenticeship program for climate entrepreneurs

Illustration by Nadya Nickels.

BY: ALICE HAVILL

Havill is a climate tech professional who has held leadership roles LanzaTech Inc. and Vartega Inc., and more recently worked in impact investing with The Colorado Impact Fund. Havill is currently a business fellow in the Breakthrough Energy Fellows Program. To connect with Havill, email her at: alice.havill@befellows.org.

As I was learning to rock climb in my early 20’s in Auckland, New Zealand, I was taught by experienced climbers not only all the technical aspects of the sport, but also how to respect mother nature and protect myself and my fellow climbers.

We didn’t have classes or credentials to signal our skills back then. Instead, a caring and disciplined community adopted us as apprentices and mentored the next generation, teaching us to thrive in the mountains respectfully and safely.

My climate technology career unfolded in a similar way. I was a part of cleantech 1.0 in the early 2000s, when we had no manual or textbook to guide us, just our lived experiences and commitment to a common climate protection goal that felt important but not yet urgent.

The early cleantech movement was powered by an informal apprenticeship model of collective skills sharing and trust formation. We recruited people with an array of skillsets, characteristics and lived experiences, then created space for them to mentor fellow team members in their areas of expertise.

From technical skills to business skills, leadership skills to personal development, we actively learned from each other, accelerating our individual learning journeys, which in turn accelerated progress on the technologies we were developing. Care, respect, transparency and integrity were essential in building trust, which formed the basis of this unofficial apprenticeship.

The urgency of climate change today means we no longer have the luxury of letting these apprentice-mentor relationships organically form.

It’s time for startups to actively adopt a cleantech apprenticeship model from their inception.

Read the full article on Cipher’s website.

Editor’s Note: The Breakthrough Energy Fellows program is part of Breakthrough Energy, which also supports Cipher.  

In a first, EU wind power surpasses natural gas power

Source: Ember, Annual European Electricity Review • "Other" includes bioenergy, other fossil fuel sources and other renewable energy sources.

BY: ANCA GURZU

The European Union’s coal and natural gas electricity dropped a record amount in 2023, leading to an unprecedented decrease in power sector emissions, fresh data out today shows.

Fossil generation accounted for less than a third of EU power generation last year, according to think tank Ember.

As coal and gas drop, wind and solar are picking up the slack. As a percent share of the overall electricity mix, wind surpassed gas power for the first time last year, having passed coal just a couple years earlier.

Meanwhile, wind and solar combined achieved their highest ever year-on-year increases, producing a record 27% of the EU’s electricity in 2023. It was the first time wind and solar have provided more than a quarter of the bloc’s power.

A 3% decline in electricity demand compared to 2022 also contributed to the drop in fossil fuel generation. But demand is expected to start ticking upward in the coming years as electrification increases, Ember said.

“As electrification takes off through more heat pumps, electric vehicles and electrolysers, the EU will enter a new era of rising electricity demand,” Ember’s global insights director Dave Jones said in a statement. “Renewables will need to keep pace with that demand increase in order to deliver the emissions cuts needed for a safe climate.”

A similar transformation is underway in the United States, albeit one where natural gas remains dominant while renewables overtake coal.

AND FINALLY...
SAFs spotted

Cipher reader Michael Armstrong took this photo of a sustainable aviation fuel tank at the Frankfurt airport. With family spread across four continents, he has to fly to visit them. Seeing SAFs in real life gives him hope for more sustainable flying in the future!

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.