A weekly five-point roundup of critical events in the energy transition and the implications of climate change for business and finance.
The World’s Largest Automaker Is Finally Taking EVs Seriously
What happened: Toyota has waffled on electric vehicles for nearly a decade. But the company has signaled its greatest support for the EV transition yet by allowing for an unprecedented two-day press tour of what it claims will be its factories of the future.
Why it matters: The world’s largest automaker has had an absolute brutal run, at first pretending that electric vehicles were a fad, putting all its support behind hybrids and even hydrogen, and even at some points claiming it would have dozens of electric models that never actually saw the light of day. All of that fake innovation occurred via press release. The fact that the company is now confident enough to promote its strategy in person, suggests that this time the commitment is real.
What’s next: At some point or another, roughly sometime in 2026 by their own estimates, Toyota is going to try to sell you an electric vehicle. What it looks like, what it costs, and how it performs will determine everything that comes next. (By Hans Greimel, Automotive News)
Why Your Flight Won’t Be Carbon Neutral Anytime Soon
What happened: During last week’s annual meeting of top airline executives in Lisbon, most signaled that the industry’s goal of carbon neutrality by 2050 was increasingly unlikely.
Why it matters: Cost curves are hard. In order to make a switch to sustainable aviation fuel, airlines would have to charge much more in the interim between low production and high volume. Those are costs consumers are unlikely to tolerate, which means no one is likely to invest in the expensive manufacturing necessary to achieve the broader goal. It’s a chicken-and-egg problem with no real solution
What’s next: Cynically, just expect to hear a lot fewer carbon promises from companies whose business is to burn fuel high up in the air. (By Kate Duffy, Bloomberg)
There Is Something Called ‘Green Hydrogen’ and a Winner in the Space
What happened: Hydrogen has its first unicorn, as the start-up Electric Hydrogen recently raised $380 million at a $1 billion valuation on the premise that it’s found a cost-effective way to deliver a greener version of the element.
Why it matters: “Green hydrogen is the holy grail of clean-energy technologies. It is one of the few options to eliminate emissions from trucks, planes, steel mills and chemical plants where renewable power and batteries alone can’t get the job done. Hydrogen is one of the few ways to move green power long distances. Potential demand is so great that the winner of the race for green hydrogen could dominate a market worth as much as $1 trillion in the coming decades.”
What’s next: So much waiting! Unveiling a new energy source requires a ton of permits, a ton of customer buy-in, and a ton of new infrastructure. (By Amrith Ramkumar, The Wall Street Journal)
Oops: The Government Had No Idea Just How Much Renewables Were Helping
What happened: The Bureau of Economic Analysis just unveiled last week that it had been using a bad metric to count the impact of investment in renewables electricity generation, undercounting that figure by a whopping 45%.
Why it matters: “This doesn’t mean that there are more wind turbines and solar panels out there than we thought. It means that the government was mismeasuring the economic impact of those solar and wind panels: Its official economic statistics were undercounting the amount of real growth happening for each dollar of investment, and therefore missing at least part of the ongoing green boom.”
What’s next: Making the case for wind and solar gets a little bit easier. (By Robinson Meyer, Heatmap)
U.S. Battery Storage Is Good, Should Be So Much Better
What happened: The good news: the U.S. added a record amount of energy storage in the second quarter. The bad: parts shortages meant a lot of delayed projects, and most of the gains came in utility-grade, not residential.
Why it matters: “The Inflation Reduction Act contains provisions that will help the storage industry, including an investment tax credit that is much easier for developers to qualify for than it was under previous law. But it will take years for the 2022 law to translate into new projects, part of what analysts expect to be a surge near the end of the decade.”
What’s next: Lots of quarterly records will be broken. But that growth may not be enough to fully empower a full energy transition. (By Dan Gearino, Inside Climate News)
