NOVEMBER 22, 2023

Happy Thanksgiving to those who celebrate!

Thanks to all those who responded about your COP28 plans. Keep ‘em coming! I’ll be there for a little more than a week at the beginning, and Bill will be there for the duration.

In this week's edition: Amena has a must-read explainer understanding the $100 billion climate pledge wealthier countries have committed to poorer nations, we have a Voices article on how oil and gas know-how can help renewables and I have a Data Dive on what parts of the world are leading in cleantech.

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Send your energy photos, story tips and more to news@ciphernews.com.

Photos in the illustration show the impacts of recent flooding in Pakistan. Illustration by Samson Awosan.

How to understand direct government aid for climate change

BY: AMENA H. SAIYID 

When talks begin later this month in Dubai at the United Nations climate conference, wealthier nations are expected to (finally) say they are “on track” to fulfill their pledge to provide $100 billion in annual funding to help lower income nations address climate change.

“I think the developed countries are on track to meet the $100 billion a year goal, which is good news, against the backdrop of being late, which we all fully admit and regret,” U.S. special deputy envoy for climate Sue Biniaz said at an Atlantic Council dialogue this month on EU-U.S. climate diplomacy.

But these countries are meeting the deadline for that pledge at least two years late, and all sides agree the sum now barely begins to address climate change in lower income countries.

“We will need to be talking about the trillions and how do you unlock the trillions,” Biniaz said.

How to help low- and middle-income countries will be one of the biggest issues at this year’s UN climate summit, known as COP28. As the impacts from global warming intensify, these countries are finding themselves among the most vulnerable.

Many are particularly troubled by the lack of assistance because they have contributed almost nothing to the accumulation of greenhouse gases in the atmosphere. Those emissions have come historically from wealthy countries, which grew their economies rapidly during the industrial revolution, and more recently from China and India.

This is the fifth article in Cipher’s series about climate financing for low- and middle-income countries in the runup to COP28.

Wealthy countries made the $100 billion climate financing pledge at the 2009 UN climate summit in Copenhagen, with a 2020 self-imposed deadline, to help low-income countries both cut their greenhouse gas emissions and protect them against climate impacts through adaptation measures.

Funding has grown over the years, reaching about $89.6 billion in 2021, according to the Organization for Economic Co-operation and Development (OECD), which represents the world’s wealthy industrialized democracies.

In fact, preliminary data available to the OECD indicates countries look likely to have met the $100 billion objective in 2022, said OECD secretary-general Mathias Cormann.

Now countries are contending with what kind of funding is in the pledge, how much more will be needed after 2025 (the starting date for a new climate financing goal) and, above all, the operation of what’s known as a loss and damage fund. That fund, first established at last year’s UN summit in Egypt, aims to pay for climate damage in poorer countries most vulnerable to the impacts of global warming.

Let’s first dissect what makes up the $100 billion and what more is needed. Then we can turn to the loss and damage fund.

The funds being put toward the pledge are short on the type of financing lower income countries need most, critics say.

According to an analysis of figures through 2020 by the advocacy group Oxfam, most of the financing so far has been in the form of loans. Just one quarter has come from grants and direct aid, the types of financing most needed by vulnerable countries already deeply in debt, said Ashfaq Khalfan, climate justice director for Oxfam America, an affiliate of the nonprofit advocacy coalition Oxfam International.

Overall, Oxfam said only a quarter to a third of the financing provided in 2020 was specifically aimed at climate mitigation or adaptation projects in the form of grants, while the rest went to projects where climate action was peripheral or in the form of loans at market rates.

“The pledge has perhaps done more harm than good, as it has given rise to increasingly 'creative' methods of accounting,” Keith Bettinger, lead for climate change adaptation and disaster risk reduction with DAI, a private development firm, told Cipher.

Tim McPhie, a spokesperson for the European Commission, indicated to Cipher that accounting for the $100 billion will take time because contributions come from various sources and in multiple forms: “While the data will not be officially confirmed this year, we expect parties to be able to demonstrate their spending in a way which will show that the pledge has been met this year.”

What’s more, it’s likely a majority of the money is going toward cutting emissions, as opposed to adapting. Such a trend is underway despite the 2015 Paris Climate Agreement calling for financing to reach a balance between mitigation and adaptation projects.

Most (60%) of the $89.6 billion in finance tallied in 2021 has been aimed at mitigating climate change by, say, building renewable energy facilities or planting and protecting forests, while 27% was directed toward projects to stave off adverse effects, according to OECD.

Read the full article, and more about the loss and damage fund, on Cipher’s website. 

Lunchtime Reads and Hot Takes

How much waste do solar panels and wind turbines produce? — Sustainability by numbers Substack
Amy’s take: TL;DR: Not nearly as much waste as fossil fuels. Keep this handy if your Thanksgiving conversations (and/or others) turn to how renewable energy is creating massive piles of toxic waste.

What Endures After a Climate Activist’s Suicide: Grief, Anger and Hope — The New York Times

Bill’s take: A wrenching tale of despair and hope. Not easy to read, but important as the world will hear at COP28 how far we have to go to beat climate change, but also how far we’ve come.

Who’s who at COP28 — POLITICO

Anca’s take: This list of 18 top climate-decision makers is a nifty read for those keen to learn about who matters, beyond the usual headliners.

I’m a Climate Scientist. I’m Not Screaming Into the Void Anymore. — The New York Times

Bill’s take: Going into the COP28 climate conference at the end of the month, an upbeat take on efforts to head off climate change certainly can’t hurt. Here’s one of the better ones I’ve seen.

How Electricity Is Changing Around the World — The New York Times
Amena’s take: As the article points out, a clean power sector is a must because it holds the key to decarbonizing the building, manufacturing and transportation sectors.

Global warming-induced sea level changes could increase earthquake risk — Phys.org
Amy’s take: Oh great, two of my biggest worries combining into one. I live in Seattle, which is ostensibly overdue for a big earthquake.

Retired Wind Turbine Blades Live on as Park Benches and Picnic Tables — Bloomberg
Amena’s take: It's not always about doom and gloom. Ohio-based Canvus is giving a "second life" to these old long-lasting and durable blades that would otherwise have ended up in landfills. Can one ask for more?

Another weapon to fight climate change? Put carbon back where we found it — National Geographic
Bill’s take: This is among the most approachable, easy to follow and colorful examinations of a technology that presents some of the toughest challenges the energy transition has to offer.

What Happens When You Put a Fossil Fuel Exec in Charge of Solving Climate Change — TIME
Amy’s take: This is one of the best profiles I’ve read. It includes fresh comments from John Kerry on the matter and was just a joy to read (the beginning is striking!).

More of what we're reading:

• US approves Equinor and BP's Empire Wind offshore project, country's sixth — Reuters

• Italy’s Enel to cut renewable investments — Financial Times

• A Global Hunt for Water Profit Risks Draining Cities Dry — Bloomberg

Let’s harness oil and gas know-how to scale the energy transition

A helicopter flies over an offshore oil rig in the Gulf of Mexico. Photo credit: Cavan Images via Getty Images.

BY: JANE ZHANG

Zhang is a Business Fellow at Breakthrough Energy. You can reach her at jane.zhang@befellows.org.

When facing a new challenge, I often find myself thinking back to a helicopter ride I took to an oil platform in the Gulf of Mexico some 25 years ago.

After a 45-minute flight from coastal Louisiana, I spotted the massive construction ship that would be my home for the next several weeks. I was there to help prepare the installation of a state-of-the-art offshore production platform in water 4,000 feet deep, an engineering undertaking rivaling that of building a spaceship.

My role was to coordinate the assembly of the sixteen 4,000-foot-long tendons made from large diameter pipes and state-of-the-art connectors that would moor the platform to the seafloor. As a supervising engineer, I was one of only two women among the more than 200 professionals on board the construction vessel.

Years and months of dedicated technology development and multidisciplinary engineering work had led to this moment, when we successfully built what was at the time one of the deepest oil and gas production platforms in the world.

After my helicopter ride back to shore, I went onto many other engineering and business roles in the oil and gas industry. I learned technical excellence, disciplined engineering, risk management and stakeholder engagement are paramount to achieving commercial success in new technology ventures, especially those that require building new manufacturing plants and infrastructure.

Now, after 30 years in oil and gas, I’m putting that knowledge to work advising climate tech startups.

Read the full article on Cipher’s website.

Editor’s note: Jane Zhang is a participant in the Fellows Program at Breakthrough Energy, which also supports Cipher.  

United States home to more than 1/3 of cleantech startups

Source: Pitchbook, GreenSpace Navigator/Deloitte analysis • Categorized by location of headquarters and is irrespective of year of founding.

BY: AMY HARDER

The United States is far and away the global leader when it comes to where cleantech companies are headquartered, but some metrics from a new report by consultancy Deloitte show its influence may be waning.

While the U.S. share of new cleantech companies being founded declined just one percentage point (36% to 35%) from the beginning of this century to the last three years, others have risen (2% to 7% in Germany and a doubling in Australia from 4% to 8%).

“These trends match the ‘rise of the rest’ in overall startup activity (beyond climate tech) that has been observed for some years now,” the report authors write.

China, which dominates in most cleantech manufacturing, is exerting its influence on the investment front, Deloitte found. U.S. companies received 76% of all global climate tech investments from 2000 to 2004 but received just 49% in the period from 2020 to 2023. Meanwhile, the investment share going to Chinese companies grew from 6% to 22% over those same time periods, the report says.

AND FINALLY...
Rig and turbine 

Driving to Denver, CO, Amena saw both an oil rig and a wind turbine at a farm. She was told it is common to see the two together in northeastern Colorado's Carbon Valley, a name given to the towns of Firestone, Frederick and Dacono. Wind power makes up four-fifths of the state’s renewable power generation.

Each week, we feature a photo that is somehow related to energy, the thing we all need but don’t notice until it’s expensive or gone. Email your ideas and photos to news@ciphernews.com.

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.