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Welcome to Zeroing In by Speed & Scale, where we cut through the noise to deliver a data-driven update on progress toward net zero.

BIG INVESTMENTS BY BIG OIL… Chevron and Exxon announced new acquisitions this month, and experts say this is just the beginning of billion-dollar deals to come. Despite calls from attendees at Climate Week NYC to shut down the fossil fuel economy, big oil companies are doubling down.

BUT BIG PRICES COULD DETER FURTHER INVESTMENT. Geopolitical conflict has a significant impact on our path to net zero and may trigger a move away from oil. The conflict between Israel and Hamas could cause crude prices to rise to more than $150 a barrel. This friction in the Middle East comes on the heels of the biggest shock to commodity markets since the 1970s: Russia’s war with Ukraine. With its Russian oil supply cut off, Europe is turning away from oil and has invested significantly in renewables.

Big Picture

Source: EU imports of energy products continued to drop in Q2 2023 – Products Eurostat News

BUT, MIND THE GAP. Governments, in aggregate, still plan to produce more than double the amount of fossil fuels in 2030 than would be consistent with limiting warming to 1.5°C. The persistence of the global production gap, which tracks the discrepancy between governments’ planned fossil fuel production and global production levels consistent with limiting warming to 1.5°C, puts the energy transition at risk.

OKRs in the News

🚗 1.0 – Electrify Transportation

• On the heels of a disastrous third quarter for one of the biggest EV players, Tesla, Toyota Motor Chairman Akio Toyoda said the EV industry faces an uphill battle. He has long denied that electric vehicles are the only way for the automotive industry to reduce emissions, saying “There are many ways to climb the mountain.”

• Electric vehicle uptake faces major obstacles, despite rosy projections last year.

OKR Highlight

OKR Highlight: 1.0 Electrify Transportation

There will be bumps in the road as we move toward the end of the ICE-age. We’re keeping our eye on three big questions:

• Can we get enough allied countries’ critical minerals to produce EVs without China?

• Can the original equipment manufacturers (OEMs) profitably produce EVs?

• Will consumer demand and gas-powered car phase-out policies in friendly states be enough to shift demand fully to EVs?

💡 2.0 – Decarbonize the Grid

• U.S. domestic oil production hit an all-time high last week, despite the greening efforts by the Biden administration.

• Wind is also falling behind as other renewables expand. Wood Mckenzie expects global offshore wind capacity additions to fall short of government targets. A surge in financing costs due to rising interest rates, along with higher prices for many of the materials that go into today’s giant turbines, has led some developers to back out of power sales or subsidy deals covering certain projects.

• A bright future: Solar is set to overpower fossil fuels as the dominant global electricity source by 2050.

🐄 3.0 – Fix Food

• Olive oil prices have more than doubled as extreme weather hit crops in Spain, Italy, and elsewhere—another food in jeopardy if we fail to address the climate crisis.

🌳 4.0 – Protect Nature

• Our funky fungi friends may be stronger than we realize. Evolutionary biologists think that Mycorrhizal fungi helped old-growth trees respond to record-high temperatures and wildfires in Corsica.

🧹 6.0 – Remove Carbon

• Every year, companies around the United States capture around 18 million metric tons of carbon dioxide from natural gas processing plants, oil refineries, and power plants. Unfortunately, most of it is used to extract more oil, in a controversial process known as “enhanced oil recovery.”

• Two years into its operation, Climeworks’ Orca has a net annual carbon removal capacity—the amount Climeworks can sell to customers—closer to 3,000 tons. Located in Iceland, the plant was designed to capture 4,000 metric tons of carbon from the air per year. While this is equivalent to just three seconds of global emissions, improvements in design and technology from the project will allow the company to scale up more efficiently and at a lower cost.

• A pioneer in corporate carbon credits is trying to restore faith in the much-criticized market by eliminating the concept of offsets, which directly ties carbon credits to reduced emissions. However, this potentially undercuts the main reason that many companies buy carbon credits in the first place.

🏛️ 7.0 – Win Politics and Policy

• Fourth time’s not the charm. After three other Republicans crashed and burned, new House Speaker Mike Johnson brings a pro-oil, climate-skeptical record to the office.

• A comprehensive new United Nations report finds plans for future oil, gas, and coal production by the top 20 largest energy-producing countries will cause us to blow past 1.5.

🏃 8.0 – Turn Movements into Action

• Since we can’t manage what we can’t measure, the fact that 23,000 companies representing over 66% of global market capitalization are voluntarily reporting their environmental impact data is an important step toward cleaning up industry.

• Meet the Guna—indigenous people of the San Blás archipelago off the coast of Panama—who are relocating to the mainland to escape rising sea levels. They’re one of the first populations of climate refugees from the Americas.

⚡ 9.0 – Innovate

• Nearly all adhesives are derived from petroleum, create permanent bonds, are a challenge to recycle, and prevent degradation in landfills. Researchers have found a way to create soya-oil-based glue to replace it, modeling the new product after the proteins that mussels use to stick to sea beds.

💰 10.0 – Invest

• Efforts to increase regulation of bank capital requirements may have the inadvertent effect of limiting investment in clean energy projects, which often rely on large lenders to finance these initiatives.

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