MARCH 13, 2024

Good morning from Miami Beach, I’m here to speak at a few events in the Aspen Ideas: Climate conference. Reach out if you’re here too.

In today’s edition: 
-    Amena on our Cleantech Tracker and carbon capture
-    A Voices article on Native Americans and critical-mineral mining
-    In our Data Dive, Anca charts China's dominance

 
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A corn field during fall harvest with a grain storage container in the background. Photo credit: J.J. Gouin via iStock.

Biofuels offer low-hanging fruit in nascent carbon capture industry

BY: AMENA H. SAIYID

Biofuel producers are taking up carbon capture and storage technology faster than any other industry in the United States as demand grows for cleaner fuels for shipping and aviation.

Four out of every ten carbon capture and storage projects announced since 2018 in the United States are for ethanol production facilities, according to Cipher’s Cleantech Tracker.

Check out our full article about biofuels and carbon capture here.

Here are the highlights:

Ethanol advantages

Ethanol production offers favorable conditions for carbon capture and storage (CCS) due to smaller sized plants and denser streams of CO2 emissions from fermenting corn, making carbon capture easier and more cost-effective compared to other industries.

Some ethanol producers have already been successfully employing carbon capture technologies, offering a glimpse into efforts to capture carbon from larger — and more expensive — technologies, including direct air capture (DAC).

“If we can’t even capture and store the cheap CO2, how are we going to capture and store more expensive sources of industrial CO2, not to mention much more expensive CO2 from DAC?” said Shailesh Sahay, an attorney with the law firm Baker Botts who specializes in the biofuels industry.

Growing interest

Cipher’s cleantech tracker shows at least 41 ethanol facilities across the Midwest, Colorado and California have announced plans to install carbon capture technology since 2018, although construction has yet to commence in most cases.

This is a static image of Cipher's Cleantech Tracker focusing on carbon management projects only. The chart includes carbon management projects only (most of which are still in the announcement phase). Data is from the Clean Investment Monitor, a data project by Rhodium group and MIT. Click here for an interactive version of the Cleantech Tracker. 

Policy support

President Joe Biden’s signature climate law, the 2022 Inflation Reduction Act, could drive increased ethanol production. Ethanol producers may receive tax credits for clean fuel production, making ethanol-based sustainable aviation fuel and for capturing carbon emissions to store or use if they meet certain requirements.

Storage solutions

Sharing transport and storage infrastructure among multiple ethanol facilities could help distribute costs and make carbon capture and storage more affordable. Building a pipeline to transport the gas can be expensive and run into local opposition, however.

Environmental scrutiny

While biofuels are increasingly viewed as cleaner alternatives in sectors like trucking and aviation where electrification is costly and complex, concerns persist regarding their environmental impact. Those include the extent to which corn-based ethanol diverts the crop from food supplies to fuel and past safety issues with CO2 pipelines.

A recent study also cast doubt on the environmental benefits of ethanol compared to gasoline.

Future outlook

“CCS is definitely pivotal to reduce the carbon intensity of ethanol producers, which increases their opportunities to play a bigger role in clean fuel production,” said Paola Perez Pena, principal research analyst for clean energy technology with S&P Global Commodity Insights.

Lunchtime Reads and Hot Takes

OPEC, IEA at most divided on oil demand since at least 2008 — Reuters
Amy’s take: This may sound inconsequential, but this gap reflects fundamental competing world views about the pace of the energy transition — and possibly competing self-fulfilling prophecies.

Germany launches green subsidies for industry — Reuters
Anca’s take: Berlin originally planned to offer a much heftier subsidies sum, but the constitutional court last year stopped the government from using some 60 billion euros of debt for climate protection projects.

Aviation industry likely to miss net zero target, warns former Schiphol boss — Financial Times (subscription)
Bill’s take: We’ll see a lot of this sort of back-and-forthing by industry officials as they walk back climate goals, only to face stepped up regulatory measures if they aren’t ambitious enough.

United States produces more crude oil than any country, ever — U.S. Energy Information Administration
Cat’s take: While deployment of clean energy is most certainly rising in the U.S., it's important keep the full energy picture front of mind in all climate conversations.

U.S. carbon pipeline company pledges no oil recovery, but Bakkan drillers want it — Reuters
Amena’s take: A question this story doesn't answer is why Summit Carbon is courting Bakken oil drillers when it already has agreements with 57 ethanol plants to transport their CO2 to storage.

Yes, heat pumps slash emissions even if powered by a dirty grid — Canary Media

Cat’s take: I have always wondered about this! Canary points to a recent report from the National Renewable Energy Laboratory and a 2023 report from the climate think tank RMI for the data.

Europe unprepared for rapidly growing climate risks — The Guardian
Anca’s take: Not the most cheerful reading but sobering and key ahead of the EU elections. Getting the EU ready for the inevitable warming will require vast investments and lifestyle changes, the report notes.

How China Came to Dominate the World in Solar Energy — The New York Times
Bill’s take: Chinese panel makers, which have combined decades of subsidies with manufacturing prowess, are very tough for other makers to compete with, even when bolstered by huge subsidies.

Amid explosive demand, America is running out of power — The Washington Post
Amy’s take: Though controversial and complicated, instituting a hierarchical system for new electricity demands could be helpful (i.e., a manufacturer needs energy more than a cryptocurrency mine).

More of what we're reading:

• Methane emissions from energy sector near record high in 2023, IEA says — Reuters
• She’s a clean-energy pro. Electrifying her home was still a slog — Canary Media

Changing the relationship between mining and Native American Tribes

Thacker Pass, Nevada is the site of an ongoing struggle over the construction of a large lithium mine. The land is sacred to local Native American Tribes. Photo credit: Carolyn Cole / Los Angeles Times via Getty Images.

BY: MORGAN BAZILIAN, DANIEL CARDENAS AND RICK TALLMAN

Click here to read the whole article and to learn more about the authors.

Native American Tribes stand to benefit greatly from mining and processing the critical minerals needed to drive the energy transition in the United States — but only if we acknowledge the sordid history of mining on tribal lands and properly remediate legacy issues while forging a new approach that is transparent, fair and centered on Tribal sovereignty.

On paper, the energy transition offers Tribes a major opportunity. Approximately 97% of U.S. nickel reserves, 89% of its copper reserves and 79% of its lithium reserves lie on or within 35 miles of Native American reservations, according to financial research firm MCSI. Nickel, copper and lithium are crucial components of batteries, wind turbines and numerous other clean technologies and military systems.

Recently passed laws, like the 2022 Inflation Reduction Act, aim to accelerate the clean energy transition in the U.S. while boosting domestic manufacturing. Sourcing some critical minerals at home is key to achieving that agenda. Many of those laws include financing specifically for climate investments in Indian Country.

Read the full article on Cipher’s website.

US, Europe struggle to keep up with China’s EV growth

Source: Rystad Energy • Includes new sales of both battery-powered and plug-in hybrid cars.

BY: ANCA GURZU

Nearly two-thirds of all forecasted electric vehicle (EV) sales this year will likely be in China, according to recent projections from Oslo-based consultancy Rystad Energy.

Of the 17.5 million new EV sales globally, 11.5 million of them (about 66%) will be in China.

EV’s are just one area in cleantech that China dominates, including solar panels. Like solar panels, China’s EV dominance doesn’t stop at its borders.

“Riding last year's momentum, Chinese automakers are aggressively expanding into emerging markets, overshadowing established players,” said Abhishek Murali, senior energy systems analyst at Rystad Energy. “This eastward shift is particularly evident in Europe, where a stagnant EV market finds hope in the arrival of budget-friendly Chinese brands.”

EV sales are still growing in Europe and the United States, but from far lower bases and at slower rates compared to China, Rystad found.

The Biden administration has taken steps toward restricting Chinese-made EVs in the U.S. market due to concerns over security, The New York Times reported last month.

AND FINALLY...
Euro energy

Anca snapped this photo of an unusual map of Europe while visiting the POWER exhibit in Brussels. Dropping the regular country lines, the Continent is divided instead in ways that mirror energy sources. Check out Geothermalia, Biomassburg, West Hydropia and the sea of Solaria. It really makes you reconsider borders in a creative way.

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.