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Solar energy conjures up images of solar panels on rooftops. The depiction is especially true in Africa, where about 600 million people are without reliable access to power — power to keep the lights on and power to keep the COVID-19 vaccine frozen.

Africa’s economy has experienced solid growth at an average of 3.7% throughout the continent. That expansion can be fueled even more with solar-based electrons and the absence of CO2 emissions. According to the International Renewable Energy Agency (IRENA), as many as 30 countries in Africa have electricity outages because supply lags demand. 

“The reliability of the grid is a major issue in Nigeria and many other parts of Africa,” says Starsight Energy’s Chief Executive Tony Carr, in an interview. “That makes expensive and highly polluting on-site diesel generators not only backup but often the principal sources of power. Further, where reliable grid conditions do exist, the costs for electricity can be rather high in some countries. Africa’s phenomenal size means that large areas of the continent have no grid at all.”

Think about this predicament for a moment. Electricity is the lifeblood of any economy. Gross Domestic Product per capita is generally three to five times greater in North Africa where less than 2% of the population is without reliable power, IRENA says. In sub-Saharan Africa, the problem is far more acute and will require billions in new investment.

By 2050, Africa is expected to grow from 1.1 billion people today to 2 billion, with a total economic output of $15 trillion — money that will now, in part, be targeted to the transport and energy venues.

Electricity also gives life to medical facilities. Reuters did a video story on how “solar freezers” are being put to use — freezers that can preserve COVID-19 vaccines. The video points to a study by Journal of Global Health, which says that nearly 60% of healthcare facilities in sub-Saharan Africa have no access to electricity. But Power Africa and a network of public groups set up by USAID is winning the financing to set up off-grid solar-powered health centers. 

“Economic growth, changing lifestyles, and the need for reliable modern energy access is expected to require energy supplies to be at least doubled by 2030,” the IRENA study says. “For electricity, it might even have to triple. Africa is richly endowed with renewable energy sources, and the time is right for sound planning to ensure the right energy mix.”

Brighter Lights Ahead

The good news is that, excluding South Africa, about 1,200 megawatts of off-grid solar power is expected to come online this year in sub-Saharan Africa. That is more than twice the amount commissioned in 2018, says BloombergNEF. It adds that regional power markets will develop, allowing countries to buy electrons from those places with surpluses. It says, however, that a lack of private investment in transmission infrastructure and in small generation fleets will hinder that growth. 

In total, more than 700,000 solar systems have been installed in the region, says the World Bank. IRENA adds that renewable energy, generally, can supply 22% of the African continent’s electricity by 2030. That is up from 5% in 2013. The ultimate goal is to hit 50%: hydropower and wind energy could reach 100,000 megawatts each while solar power could hit 90,000 megawatts. To get there, though, an investment of $70 billion a year is necessary. That’s $45 billion annual for generation capacity and $25 billion a year for transmission. 

One potential remedy is “energy-as-a-service.” Starsight Energy uses such a model, which takes the solar panels, battery storage, and cooling assets off of the balance sheets of its commercial and industrial customers. Starsight, for example, will conduct an energy audit and design a tailored solution based on its energy demand. It then maintains this solar system at no upfront cost. Instead, the commercial or industrial facility will pay the vendor a monthly fee for monitoring, maintenance, and support throughout the system’s life-cycle.

Globally, energy-as-a-service is expected to reach $173 billion by 2027, says Grand View Research. The key driver is the precipitous fall in solar panel prices, about 80% of what they were a decade ago. The Asia-Pacific region is expected to embrace this business plan — one that sub-Saharan Africa could also easily adopt. And commercial enterprises with limited access to capital and little energy management experience are the best prospects. The market leaders in this area, says the research firm are: General Electric

GE
, Siemens Engie, Honeywell International Inc.

HON
, Veolia, Johnson Controls

JCI
, and EDF. 

While reliability and affordability are paramount, “Our industry may face regulatory challenges as governments continue to develop policy regimes for renewable energy development, says Starsight’s Carr. “Currency risks can also be an issue.”

Energy access provides hope for a stable economic life as well as a more vibrant existence and one free from COVID-19. An expansion of off-grid solar energy in Africa could help ensure this outcome. And a burgeoning continent is good for everyone and especially those energy ventures that want the region to shine.

There has been a lot of talk recently about a study published in Nature last week, which surveyed Californian EV owners and found that one in five went back to internal combustion after bad experiences with electric. Their chief reason was the hassle of charging. This has of course been picked up by journalistic publications as evidence that EVs are problematic. However, there are some obvious issues with the reasoning, and the study on which it is based. Charging an EV publicly is more hassle than putting fuel in an internal combustion car, but is it really such a dealbreaker?

First, let’s address that study. Yes, it was published in Nature, one of the most respected academic journals in the world. But dig a little deeper, and you will see that most of the data was from 2015-2018, with just one final survey at the end of 2019. While the number of fossil fuel stations is falling, the number of public EV charging stations is growing fast. For example, in Q1 2020 alone the US EV charging network had grown by 7.6% over Q4 2019, and the majority of that was in chargers able to deliver 50kW or more, known as DC Fast in the US and Rapid in the UK.

Things are moving quickly in the EV world, and unfortunately in the world of peer-reviewed academic journals they move quite slowly. The data in the Nature article is already starting to be out of date, even though it was published last week. Taking the UK as an example, because the figures are readily available from Zap-Map, there were 25% more chargers in 2017 than 2016, 35% more in 2018 than 2017, 54% more in 2019 than 2018, 24% more in 2020 than 2019, and already by 1st May 2021, 12% more than there were in 2020. The growth is phenomenal. It does need to be, to keep up with the growth in EV sales, which in the UK were up 185.9% in 2020 compared to 2019. But it’s a fast-moving target.

There is still a problem with public charging in most countries, however. The number of chargers is only a small part of the story, too. In the UK, a lot of the public charging network in key highway locations is run by Ecotricity’s Electric Highway, and a large percentage of that is either AC (equivalent to Level 2 in the US) or CHAdeMO DC, which is great if you have a Nissan Leaf or Lexus’s UX300e, but incompatible with most modern EVs that use CCS. There might be a lot of chargers, but they also might not be very good for topping up your car on a long journey, and a lot of them often don’t work, either.

Another thing that is highlighted by the journalistic article mentioned earlier is that there is national nuance in the EV debate. For example, a Bloomberg analyst complained that an hour of charging gave the Ford Mustang Mach E he had borrowed for review just three miles of range. But that is partly because the US has a 120V supply and just plugging into that is very much only an emergency solution, not how you should charge your car regularly. If you own a house with off-street parking in the UK, you would be a fool not to install 7kW home charging (it’s government subsidized, too), which will put about 30 miles in a Tesla Model 3 Long Range in an hour and easily get it to 100% overnight. The UK voltage is also 230V as standard, so plug-in chargers tend to deliver 2-3kW, which will also mean more than three miles of range an hour.

However, the biggest issue with the switch to EVs is really one of education and lifestyle change. Borrowing an EV for review and expecting to use the plug-in charger solely (called a “granny charger” in the UK for a reason) is not understanding the shift in habits required by electric ownership. Nor is judging an EV because you can’t just rock up to the nearest refueling station and put 300 miles of range in it in five minutes, like you always used to. If you buy an EV, you need a clear idea where your main charging will be. This is easy if you can install a wall charger. Then 99% of your journeys will be on home power.

That’s obviously not possible for everyone, but even for those who don’t have this (myself included), choosing an EV with enough range for your regular needs, and having a charging regime, are essential, at least for now. You need to have a much clearer idea of where you can recharge, and also how fast those recharging spots are. There are some great apps for that, although you may find you will need more than one.

You also need to get to know the real range of your vehicle, because the manufacturer ratings, whether EPA or WLTP, are overly optimistic, and very much so if you have to drive over about 50mph regularly. However, there are positives as well as negatives from all this. I had an issue driving the new Mini Electric back from its launch event recently because it didn’t appear to have quite enough range to get me home. I stopped in an unfamiliar spot only to find that the chargers my app had suggested were the wrong connector type (those dreaded Ecotricity CHAdeMO ones mentioned earlier). But nearby was a brand new IONITY installation, which just happened to be on “free vend”. So I recharged the car for nothing, turning a potential story of woe into a happy ending.

This is not to say that EVs are completely perfect, and everyone should buy one right now because charging isn’t really an issue. There is still a lot of work to be done – converting those Ecotricity Electric Highway stations all over to fast DC with CCS connectors, for example, which is likely to happen now that company is partnering with Gridserve. If you do a lot of miles around remote areas with poor public charging, an EV is probably not the best choice yet either.

The key thing is not whether EVs are good or bad overall, but that any prospective buyer does their research first and gets ready for the lifestyle change. Prepare yourself to charge mostly at home (if you can) or have a routine of places where you go to shop, exercise, or eat that also provide charging. Get to know the charging options on your regular routes too. If you buy an EV without this, it’s not really the EV’s fault if things don’t work out – it’s yours for not doing your homework first.

My Oxford colleague Professor Colin Mayer and I have written before about the campaign Engine No. 1, a new and small hedge fund, is waging against the oil and gas giant ExxonMobil. The purpose of their campaign is to place four directors on the board who can help the company create a business strategy that is both financially and environmentally sustainable. It is absolutely essential that all four be elected.

By way of a little context, ExxonMobil has dramatically underperformed its peers over the last 10 years (-57.2 percent in total return pre-COVID). Since 2010 its credit rating has been downgraded twice by S&P, which has put it on negative watch. Contributing to this downgrade is that its net debt has ballooned from $7 billion in 2010 to $63 billion in 2020. This debt has been used to fund projects at a spending rate greater than any of its peers, projects that require the highest oil breakeven price of any of its peers in order for them to be profitable. It has no credible plan to protect and create value during the inevitable energy transition.

A concise summary of the reality of ExxonMobil’s corporate strategy is, “As long as there’s oil and gas out there, we’re gonna drill for it. No matter the cost and how much money we lose in doing so.” An equally concise summary of their (roll up, roll up) Magical Mystery Tour strategy is, “Hey, not to worry. Thanks to our amazing efforts in carbon capture and storage, with a little bit of help from our algae friends, all will be well!”

These are admittedly concise summaries, so let me dig into each. I’ll start with the reality of what ExxonMobil has done and plans to do, taken from a brilliant 81-page analysis by Engine No. 1, “Reenergize ExxonMobil // Investor Presentation.” I will then take you on the company’s Mystery Tour (which is hoping to take you away) in its response to Engine No. 1: “Growing Shareholder Value in a Lower-Carbon Future,” an SEC filing, no less.

Engine No. 1’s analysis addresses six issues, provides some very constructive suggestions for how ExxonMobil can play an important role in creating a low-carbon future, and provides long-term demand projections which challenge many of the company’s basic assumptions. The document is a nice combination of careful empirical analysis, expert commentary, and points out contradictions and flaws in the company’s statements.

·     Issue #1—Failure to Position ExxonMobil for Long-Term Value Creation: The company’s core plan is based on overly optimistic assumptions about demand growth for oil and gas. ExxonMobil is trying to shift the conversation to emissions intensity rather than total emissions and arguing that Scope 3 emissions are society’s problem, not its problem. It is investing in a large number of projects that will achieve mediocre returns. Among listed oil and gas companies, it scores the lowest in a Bloomberg Business Model Transition Score, and between 2015-2020 its low-carbon investments as a share of capital expenditures were the lowest of any oil and gas company (significantly less than 0.1 percent).

·     Issue #2—Rhetoric Does Not Address Long-Term Business Risk from Emissions: I’m just guessing, but based on the numbers from Engine No. 1, I wouldn’t be surprised if ExxonMobil is spending more on advertising its miniscule efforts in things like carbon capture and storage (CCS) and biofuels (although it did do a cute commercial in which it said “Algae are amazing little critters…”) than the projects themselves. It has projected a wildly overoptimistic trajectory for carbon emission reductions, its carbon emissions intensity will increase through 2025, and yet laughably argues that it is in conformance with the Paris Agreement. It is completely unprepared for a carbon tax which would smack its gas business hard, a business it projects to be a major source of growth.

·     Issue #3—Lack of Capital Allocation Discipline: The numbers here somewhat boggle the mind; they make you wonder if executive management and the board care about numbers at all. Returns on upstream projects (75 percent of capital expenditures) have been declining for years, even in times of high oil prices. The productivity of these expenditures has decline dramatically from 39-barrel oil equivalent (BOE) per $1,000 invested to less than 8 today. Its capital expenditures have outpaced cash generation and it is spending much more dramatically than its peers. This has all added up to the company entering the Value Destruction Zone (return on capital vs. weighted average cost of capital) in 2015 and projected to remain there through 2023.

·     Issue #4—Little Reason to Trust Newfound Spending Discipline: The company has flip-flopped on its spending plans. Late last year, no doubt under pressure from the Engine No. 1 campaign, it announced spending cuts. A few days later it was like, “Uh, just kidding. We’re still gonna go get that oil and gas, just delaying it a bit.”

·     Issue #5—Lack of Successful and Transformative Energy Experience on the Board: The company has a history of putting together good-looking gender and racially diverse boards of big-name CEOs from big name companies. None of them have had any energy experience.  In a process rife with problems, ExxonMobil appointed three new directors. Two have no energy experience, a cable guy and a hedge fund manager. The third one is from a state oil and gas company that has no shareholders and a company with which ExxonMobil has had a long-term business relationship.  Yet when Engine No. 1 proposed four people with outstanding experience across the energy spectrum, rather than even meeting with them, the board packed itself with these three new directors.

·     Issue #6—Misaligned Incentives: In a feat of compensation structure magic, the CEO’s stock awards (60 percent of compensation) have gone from 132,000 in 2017 to 205,000 in 2020. During that same time period, the company’s market cap has gone from around $350 billion to around $176 billion. I mean, if the stock price is going down, you have to give the CEO more shares to pay rent and buy groceries, right?

And now, here’s my invitation for you to Step Right This Way! for the Mystery Tour (no need to make a reservation). The tour begins with a little chest beating with big numbers and how the company has the “Right strategy, strong performance, world class board.” It takes a few pot shots at Engine No. 1 about not engaging, a nice wave of the Wizard’s Wand from a company famous for not engaging with its investors. In a series of beautifully designed, multicolor graphics it eloquently waxes on about the energy transition and economic growth, low carbon solutions, how much they mean to the company, and how uniquely positioned the company is to pursue them with its strong capabilities. Particular flourish is given to biofuels and CCS. The company projects that their amazing little critters will produce around 10,000 barrels in 2025, about 0.02 percent of the company’s total refining capacity. These critters need to make more babies soon, and they all have to work harder!

But the really magical fantasy part (satisfaction guaranteed) is in the company’s discussion of carbon capture and storage (CCS), beginning on p. 13. Then the rabbit pops out of the hat on p. 15 with plans for the Houston CCS Innovation zone. The company is so enamored of CCS that it has produced advertisements of how it’s going to spend $100 billion on this to mitigate around 100 million tonnes of CO2 annually. Sounds good, right? But here’s where the magic starts to fade. Much of the captured carbon is going into forcing more oil out of the ground. The project is also not viable without a tax on carbon, a tax which would basically gut the company’s entire business model.  

Reflecting on this elegant legerdemain, Professor David Victor, a convening lead author for the Intergovernmental Panel on Climate Change (IPCC), observed that, “Here’s the sad truth on this PR exercise. ExxonMobil’s Houston project does not exist. Nor are there any signs that the vision, for which the firm has offered barely more detail than a college book report, is being readied for investment. The project’s $100 billion-plus price tag isn’t something ExxonMobil plans to pay for itself—instead, it wants massive government support.”

Andrew Logan, Senior Director Oil & Gas at Ceres, further explained, “Exxon is counting on carbon capture as a get-out-of-jail free card that will allow it to continue growing oil and gas production and still somehow align with a Paris-compliant trajectory. The problem is that CCS has been 15 years from commercial scale-up for the past 15 years, and this announcement doesn’t do anything concrete to speed up the process. If Exxon actually believed in the potential of CCS, it would set a net zero Scope 3 target as Oxy has done. That it hasn’t suggests that even Exxon doesn’t believe its rhetoric on carbon capture.”

So your taxpayer dollars would be going to help save ExxonMobil’s business model for a technology which is unproven at any meaningful scale. In the meantime, some of its more thoughtful competitors are investing in proven and profitable renewable energy technologies.

I realize ExxonMobil was hoping to take you away on their tour and maybe you were hoping it would give you everything you need. But now it’s time to wake up and get back to reality. What can the company do to get itself out of the deep hole it’s dug for itself over the years? It’s actually pretty straightforward. It’s not conceptually difficult but it will require a change in mindset and a big dose of humility, both no doubt hard for this company’s executive team and board to swallow.

Engine No. 1 has four sensible recommendations that will benefit investors, the environment, and the company itself that involve board composition, long-term strategy, capital allocation, and incentives.

First, and this is absolutely essential, the company needs four new board members: Greg Goff (proven value creator in the oil and gas industry), Kaisa Hietala (same and also proven value creator in oil and gas transition), Anders Runevad (deep understanding of impact of technological change and falling costs on various forms of energy), and Alexander Karsner (decades of energy experience, regulatory experience, and expertise in new energy technologies). Commenting on these nominees, Aeisha Mastagni, a Portfolio Manager within the Sustainable Investment & Stewardship Strategies Unit at CalSTRS, which is supporting the Engine No. 1 slate, commented that, ““ExxonMobil needs directors with expertise in energy and other industries under transition to effectively position the company for the long term. These candidates have the skills necessary to address ExxonMobil’s financial underperformance, align incentives with shareholder value creation, and prepare ExxonMobil for the global energy transition. We hope to see broad support for all four candidates.”

A revived board with the requisite expertise can then work with Chairman and CEO Darren Woods to craft a long-term strategy that gradually but purposefully repositions the company to succeed in a decarbonizing world. In its Mystery Tour the company complains that Engine No. 1 has not put forth a credible plan. Obviously, for it to do so would require information from inside the company.

The long-term strategy must include a long-term commitment to a coherent returns-focused strategy, something the company has consistently proven it is unable to do. With the right board, only the capital expenditures which make economic sense would be approved. Here the company would benefit from reading “Energy Transformations: Technology, Policy, Capital and the Murky Future of Oil and Gas” which Victor wrote in collaboration with Engine No. 1.

Finally, the proper incentive structure needs to be put in place which rewards management for creating shareholder value and not rewarding them for destroying it. This would include consistent metrics with disclosed preset weightings and targets, with more cost management and balance sheet-focused metrics; measuring value creation not just by reference to the oil and gas industry but to the overall market; and metrics tied to the energy transition. Examples include BP (40% weight), Shell (20%), and Total (25%).

In addition to CalSTRS, other major investors are coming out in favor of Engine No. 1’s slate of directors and plan, including CalPERS, the Church of England pension fund, and the New York State Common Retirement Fund. Anne Simpson, Managing Investment Director of Board Governance & Sustainability at CalPERS, and the investor representing Climate Action 100+ in its engagement with ExxonMobil stated that, ““Investors need climate competent boards to oversee the complex and vital task of developing credible strategies for managing the risks and opportunities of climate change. That can’t wait. As fiduciaries we need to ensure boards are equipped with the talent, skills and experience to get the job done.”

Engine No. 1’s campaign is a watershed moment in the needed energy transition. It has targeted exactly the right company to make the point. This is a moment of truth for all the asset owners and asset managers who have pledged their commitment to a net-zero world, as well as for the proxy voting firms, Glass Lewis and ISS.

Investors will vote their shares at the May 26 shareholder meeting. They have a choice to make. They can roll up, roll up with the company on its Magical Mystery tour. It will take them away to a place where they don’t want to be. More shareholder value destruction and more carbon poisoning our world.

Or they can vote for the Engine No. 1 slate. And, again, they need to vote for the entire slate in order for the board to have the critical mass it needs to put a new strategy in place. I am hoping that ExxonMobil’s shareholders will make the right decision. It’s a decision that matters to all of us.

Will Homo sapiens be the species that saved itself or the species that meticulously documented its own demise?

That question emerged as a strong undercurrent at the Nobel Prize Summit this week, in which the world’s leading scientists gathered to transform scientific knowledge into existential action.

“The question is, why actually did we not react faster in implementing some of these options for solutions?” asked Peter Schlosser, a renowned earth scientist who heads the Wrigley Global Futures Laboratory at Arizona State University. “Why are we watching these scenarios play out in a somewhat contemplative manner?”

In an earlier panel on transformational economics, the Swedish environmental scientist Johan Rockström noted the historic significance of the summit itself:

“It’s basically science standing on its own evidence to reach out to humanity about what I would argue to be the most dramatic conclusion in the history of modern humans on planet earth—namely that we’ve reached a state of planetary emergency.

“That’s not a small thing. That has never been declared before.”

There is “unequivocal evidence” that we have passed three tipping points already, Rockström said:

“What does that mean?” Rockström asked. “Well, that means pain. That means rushing toward more heat waves, diseases, droughts, floods, more impacts on particularly vulnerable communities in the world.”

The good news, according to Schlosser, is that we know more than ever about the planet we live on.

“We did really advance our science, and not just to understand the changing dynamics of our planet. We also did possibly understand the consequences of rapid global change, and on the positive side, we came up with options for how to address some of the challenges that were brought along with these rapid global changes.”

Those options include the United Nations’ Sustainable Development Goals, adopted in 2015, that a number of the scientists are eager to pursue. The SDGs don’t limit themselves to environmental concerns, but include such social aims as gender and race equality, access to education, and the elimination of hunger and poverty.

Rockström is helping to lead a new collaboration between the Potsdam Institute, the Norwegian Business School and the Club of Rome, a group that pursues science-based solutions to interconnected global problems. The collaboration, called EarthforAll, will model pathways to transform global energy and food systems, battle poverty and inequality, and temper population growth through education, health, and family planning. The models will be validated and calibrated, Rockström said, with the capacity of the earth to sustain them.

“Humanity is now the largest driver of change on earth,” said Sandrine Dixson-Decleve, co-president of the Club of Rome. So why not drive positive change?

“Were going to need systemic transformation to truly emerge from emergency,” she said. “Ultimately if we are to value our future, we need to value resilience in societies and in nature. We need to look at interlocking systems and integrative systems approaches in order to understand how to really shift toward those kinds of actions that our going to make our footprint much less and ensure that we can survive on this planet that we call home.”

Net-zero climate commitments are all the rage. Former Bank of England Governor Mark Carney recently led the launch of the Glasgow Finance Alliance for Net Zero (GFANZ). The UN-convened Net-Zero Banking Alliance (NZBA) announced net-zero commitments from 43 global banks. At President Biden’s climate leaders’ summit, numerous countries were pressed about their paths to net-zero. The emergence of net-zero as a climate goal is a positive development that is based on the latest climate science. However, understanding the challenges behind the “net” in net-zero is critical for meaningful climate action.

A Tight Budget

In 2018, the UN’s Intergovernmental Panel on Climate Change (IPCC) issued an alarming report. The planet had warmed about 1°C above pre-industrial temperatures, and impacts were already being felt in “more extreme weather, rising sea levels and diminishing Arctic sea ice.” The report explored the impacts of further warming on societies, ecosystems, and the Earth overall. Their conclusion was sobering: “every extra bit of warming matters…warming of 1.5°C or higher increases the risk associated with long-lasting or irreversible changes.” The research indicated that planetary systems could be highly sensitive to small changes in temperature. As a result, keeping temperature rise below 1.5°C became a critical goal in limiting the worst impacts of climate change.

However, the world currently emits around 36 billion tons of carbon dioxide each year (2020 emissions were lower due to the COVID-19 crisis). Since the industrial revolution, human activities have raised atmospheric carbon dioxide levels by 50%. These rising carbon dioxide levels (and the production of other greenhouse gases) has raised temperatures at an unprecedented rate. While some greenhouse gases are relatively short-lived in the atmosphere, most carbon dioxide remains in the atmosphere for centuries or longer. Thus, cumulative emissions can determine future temperatures. As a result, there is a very limited carbon budget to hold warming below 1.5 °C. Estimates of the remaining budget range from 6 to 11 years at today’s emissions levels. These emissions are wholly incompatible with global climate goals. As a result, the world needs undergo rapid emissions reductions to remain within its carbon budget. The IPCC stated that a 1.5 °C-aligned path will require anthropogenic carbon dioxide emissions to fall by about 45 percent from 2010 levels by 2030 and to reach “net zero” around 2050.

Why “Net”-Zero?

Reducing emissions so far and fast demands major changes across nearly all economic sectors. Unfortunately, some industries may be technically difficult or expensive to decarbonize. A few examples include aviation, shipping, and building materials (namely concrete). Given the challenge in decarbonization, these industries may continue producing emissions even after 2050. However, their emissions can be offset by activities that actively remove carbon dioxide from the atmosphere. These activities may be natural solutions like reforestation or technological ones like carbon capture and sequestration (CCS). The key is that carbon dioxide emissions produced in 2050 are balanced by equivalent carbon dioxide removal, hence the “net” in net-zero.

While the mathematics of net-zero are sound, the application of offsets and negative emissions technologies has been more complicated in practice. Some carbon offset schemes have suffered from credibility issues. In certain cases, offset credits were given for projects that would have been completed anyway, a form of double counting. Others may plant saplings but claim credit for the potential emissions reductions of a mature forest, which may take decades to capture the emitted carbon dioxide. Most worryingly, in some projects indigenous people have been forcibly removed from land that has been designated for carbon offsets. These concerns mean that independent verification of offset project practices is crucial if they are to play a significant role in achieving net-zero.

Negative emissions technologies also have drawbacks. Carbon capture has long been touted by coal and gas power plant operators, but the economics have proven difficult. With solar and wind power plunging in cost, it is increasingly cheaper and easier to simply shift to non-emitting energy sources. Bioenergy with carbon capture and storage (BECCS) and direct air capture (DAC) have the potential to reduce carbon dioxide and offset residual emissions. However, these technologies are largely untested at scale. In the case of bioenergy, fuel crops can compete for land with food crops, an issue exemplified by problematic ethanol production policies. For direct air capture, the technology is still massively expensive and only operational at a few demonstration sites. Negative emissions technology may help address the climate challenge, but its uncertainties should be acknowledged in any net-zero plan.

Net-zero represents a global goal. Governments, businesses, and societies must commit to reduce emissions. Based on the best climate scenario models, net-zero by 2050 represents the best way to manage the transition to a low-carbon future while minimizing the climate risks faced. However, the “net” component of the commitment is rife with uncertainties about sector decarbonization behavior and negative emissions technologies. Leaders striving towards collective climate goals should carefully consider the assumptions in the net-zero pathway they choose.

Food and Agricultural Policy are directly affecting rural areas, but with more than half of the global population residing in urban areas how can cities help fostering and supporting sustainable food systems?

Municipalities – with their close connections to residents, local businesses and civil society organizations are now key to the implementation of most SDGs as well as tackling climate change from a food perspective.

Urban food policies are an effective tool to initiate the sustainable transition of food systems. From May 2015, when the Italian city of Milan hosted the EXPO 2015, with the theme “Feeding the Planet, Energy for Life”, it came the idea to not confine those efforts merely to that event, which however run for 6 months. To keep the momentum and interests sparked over the topic, the Mayor of Milan proposed to create a pact among cities. The Milan Urban Food Policy Pact (MUFPP) is in fact a global commitment of mayors from around the world that considers food as an entry point for the sustainable development of growing cities. The MUFPP constitutes a platform for spurring innovation, knowledge sharing and cooperation among cities.

So far around 370 different best-practices across the world have been collected and replicated among participants. Urban agriculture, food banks, but also, increasing cities’ share of organic food procurement or fair trade products, promoting shorter supply chains, reducing cities’s food waste or diminishing meat consumption in public kitchens.

Within the years more cities are joining the pact, now counting 216 participants as of April 2021. In mid April the renew of the Steering Committee for the years 2021 – 2023 took place, which will now be chaired by Antananarivo (Madagascar), Ouagadougou (Burkina Faso), Bandung (Indonesia) , Seoul (South Korea), Barcelona (Spain), Birmingham (United Kingdom) , Kazan (Russian Federation) , Tel Aviv (Israel), Mérida (Mexico) , New Haven (United States), Belo Horizonte (Brazil) and Rosario (Argentina). “We welcome the 12 cities elected to the Steering Committee, which in the next two years will be at the forefront of promoting sustainable food policies.” said Milan Deputy Mayor Anna Scavuzzo.

The latest to join the Pact is Sidney while the city of Wellington in New Zealand expressed its interest in taking part to the initiative. Particularly, cities in the Asia-Pacific region are increasing their interest in urban food policy development as they are experiencing a significant urban growth. Within the region there are now 15 signatory cities, representing about 130 million people.

The Italian city is setting the common ground for local solutions at global scale, but as well it looks at the European level. Together with the Municipality of Bergamo, Birmingham, Bordeaux, Copenhagen, Funchal, Grenoble, Groningen, Thessaloniki and Tirana, the city of Milan participate to the European Horizon 2020 project Food Trails, which will attempt to understand what roles can cities play in the EU’s Green Deal and the Farm to Fork strategy, to further foster sustainable food systems.

Before the sun comes up over the rows of salad greens and cauliflower and other vegetables that blanket California’s farms, operators who have been trained to manage the hulking orange machines known Titan FT-35s load them up from the Salinas hub of Farmwise—a startup that offers robotic weeding as a service—and transport them via tractor-trailer to farms in California and Arizona. 

Rented at a per-acre cost, the geo-fenced robots drive along planted rows, capturing images of crops that get uploaded and run through a model trained to classify each image. Weeds get the chop. Vegetables remain. The more time a robot spends at a given farm, the better the AI gets, and so does the weeding. To date, FarmWise’s robots have imaged about 200 million individual crops and partnered with about a dozen of the largest vegetable farms in the U.S. 

Cofounders Sébastien Boyer and Thomas Palomares launched Farmwise in 2016 to tackle two major pain points for the farming industry: the increasingly unpopular use of pesticides, and persistent labor shortage. Robots, they believe, can solve this problem, especially for high-value crops–which tend to be labor intensive and expensive to produce—like the leafy greens for which the Salinas Valley (nicknamed “America’s Salad Bowl”) is known. Rather than using chemicals or changing to crops, like tree nuts, that are easier to grow, farms can hire FarmWise; when the robots are dispatched, they tend to eradicate 95% of weeds, Boyer says, allowing farms to grow the crops they want to grow, and to do so sustainably. No chemicals, no problem.

A return company on the Forbes AI 50 list for 2021, FarmWise raised a $5.7 million seed round in 2017; two years later, it followed that up with a $14.5 Series A led by Pasadena-based Palisades Ventures. The robots are now on their third generation: the more Boyer and Palomares learn by visiting farms and talking to farmers, the more they are able to refine and advance the technology that underlies their platform.

“We weren’t coming to them with anything to sell,” Boyer says of the farms with whom FarmWise has developed partnerships. “We were really coming to them with more questions than answers.” Their focus on weeding is the result of these interviews. 

“If you look at farming as a whole, three quarters of all the chemicals used are used to kill weeds,” Boyer tells Forbes. In the absence of herbicides—which are never used for organic crops—weeding is done by hand, which is a problem, because the U.S. labor force does not have the hands that producers need. In 2018, the USDA reported that American farms have found it increasingly difficult to hire and maintain workers; in a survey of 1,000 Californian farmers that came out the following year, 42% of respondents said they adapted to labor scarcity by reducing pruning or weeding, and 27% said they delayed those same processes. 

FarmWise’s cofounders, both born in France, met as classmates at the prestigious Ecole Polytechnique, in Palaiseau. Palomares had grown up helping his grandparents at their farm in a small town in the Alps. “They were making yogurt and cheese, like a lot of farms in France,” he says; either way, from a young age he intuited the physical demands that farm work placed on the human body, and the emotional effects wrought when that labor brought insufficient fruits. After graduation, Palomares went to Stanford, and Boyer to MIT, but they kept in touch and eventually decided to launch a company that would draw on their shared interest in technology, sustainability and agriculture. 

Recently, FarmWise has released a beta version of a new grower dashboard to a few customers, which will allow farmers better and more precise insights—like crop count, crop size, and spacing trends, for instance—into crop conditions. They are also hoping to expand the crop varieties on which the robots can work, which they believe the deep-learning their technology employs makes them uniquely positioned to do. 

“Competitors who develop automated weeders often rely on simple infrared technologies and human-defined parameters which fail at successfully handling the variety of use cases we have to deal with in the field,” Boyer explains. 

For Alain Pincot, a managing partner at Betteravia Farms, which sells its produce under the label Bonipak, getting involved with FarmWise was a no-brainer. “We are, I think, a very progressive organization,” he says. Like the Farmwise founders, Pincot is French—he came to California to study agribusiness at Santa Clara University—and says that, in terms of welcoming automation into the agricultural industry, the U.S. is a bit behind. 

“I think Europeans are ahead of us Americans,” Pincot says. “They have experienced much earlier than us constraints with labor, and cost of labor. As early as the mid 90s or early 2000s, they were already thinking about how they could reduce their cost. While in the U.S., we still had it—let’s face it—pretty good.” The USDA report affirms this latter part of Pincot’s analysis: in the latter half of the 20th century, the U.S. enjoyed an influx of inexpensive labor from Mexico, which has now, for a variety of reasons, declined. 

Boyer and Palomares believe that the technology they have already created will serve as the launchpad for future endeavors, including moving into vineyards, tree crops, and commodity crops  like corn, soybean and wheat. The company plans to expand into crop protection and fertilizing, in addition to its weeding services.

As it does so, Boyer says, the startup will keep an eye on creating jobs, not just automating them. “The impact that we have on jobs is to create a new type of farming job,” one without grueling manual labor. These new jobs, Boyer believes, will be not only better paid, but also “more interesting.” 

“These are the jobs of tomorrow for the farming industry,” he says. “That will create a totally new type of workforce.”

These days every company is being valued on the data that it captures from customers, even making some organizations’ data worth more than the company itself.

With that being said, most organizations are scrambling to create ways to capture that data and have it available to access anytime, which requires some hardware. That hardware can mean a data center, which has become a real estate boom.

Diana Olick, real estate correspondent at CNBC, reported that the remote work trend due to the pandemic is creating more demand for data, and supply grew by 5.9% in major data centers. In the same article, commercial real estate firm CBRE predicted that 2021 is going to be a record year for the growth in the data real estate sector, which is measured in power, not square footage.

“These building types are so valuable to our modern lifestyles, they are being constructed at a pace that will see the amount of facilities more than double in the next 10 years,” said Zenon Radewych, principal at Toronto-based architecture firm WZMH Architects.

The demand is predicted to continue to grow because of the increased use of internet of things devices, along with enhanced computing ability, self-driving cars, 5G technology, networking infrastructure and storage resources.

As data centers are currently built and designed, they don’t last as long as traditional buildings, with a lifespan of only 15 to 20 years. With growing demand, short lives and huge energy needs, data centers are a threat to the built environment’s positive environmental progress.

“For example, Northern Virginia is known as the data center capital of the world,” said Radewych. “There, Louden County has more than 60 data centers, which house an average of 12 generators each – this is equal to generating power for more than 45,000 residential apartment units per month.”

Otto VanGeet is principal engineer of the Applied Engineering Group at research group National Renewable Energy Laboratory (NREL) and points out that data centers represent 2% of the electrical use in the US right now, and that number continues to grow.

Data Center Passive Energy For Housing

Data centers have large uninterruptible power supply systems that are made of many generators and are designed to operate for multiple days at a time.

As WZMH explains, these generators are tested once per month, but the energy generated from the routine testing is not used to support any of the building’s electricity requirements, so essentially, the electricity created goes to waste. Plus, data center servers work all hours of the day to satisfy the country’s vast data demands, which generates a lot of heat that also goes to waste.

The combination of generator tests and wasted heat present an opportunity: co-locating housing with data centers, where the housing will be able to benefit from the wasted energy from the routine testing of onsite generators and the wasted heat that can be used to heat housing in particular climates.

“Waste heat can serve to heat entire residential buildings. With thermoelectric panels, some can even be converted into ‘recycled’ electricity that can be fed back to a community-based DC microgrid, which can provide power for housing and other buildings,” said Jeremy Lytle, a student at Ryerson University working with WZMH on a new product to leverage the microgrids that operate with direct current or DC electricity.

While NREL is running research on managing waste heat better, VanGeet points out that the industry as a whole isn’t doing a very good job with it yet.

“Data centers are essentially giant electric heaters,” he said. “That heat is rejected to the ambient. Big opportunity is to start reusing that waste heat for something. We do that right now at NREL. We publish reports on how we are doing with that and encourage that.”

WZMH has been able to demonstrate that using five units of data center floor area for every 100 units of residential floor area can provide enough waste heat to completely eliminate the natural gas demand for residential space heating in a cold climate like Toronto where the firm is located. Which is money in the bank, because data center waste heat is 100% reliable.

WZMH estimates that a data center with eight three-megawatt diesel generators that are tested for one hour each month can supply a 125-unit multifamily building with enough energy to cover the equivalent of one day per week of free electricity for every unit in the building.

Alternatively, VanGeet suggests that the key strategy should be just to minimize generator run time.

Making It a Reality

Whether by choice or encouraged by new building codes, data center owners and developers are interested in greener solutions to reduce the carbon footprint.

NREL explains that the general data center efficiency strategy is to first make the data center as efficient as possible, measured by power usage effectiveness. Then, reuse as much waste heat as possible, measured by energy reuse effectiveness. Then, reduce the water use as much as possible as measured by water usage effectiveness. The lab’s current work is focused on transitioning data center design from air cooling to primarily warm water liquid cooling, which improves all the metrics, including power, energy and water usage effectiveness.

Yet, most of the time it comes down to cost.

Developers are looking at how to “green” data centers by using low-emission building materials to aid in creating sustainable ecosystems and ensure efficient waste recycling. Some data centers are being designed with liquid cooling technology and direct-to-chip cooling server racks to prevent overheating.

Plus, innovators such as Google and Iron Mountain have committed to sourcing renewable energy to move to a truly carbon free energy supply.

The costs of the system proposed by WZMH Architects would be between $10 and $15 million, which is much less than the cost of building a traditional power plant. Although it’s less than a power plant, it’s still a hefty amount, so the cost would need to be distributed among the various project stakeholders and benefactors.

Detailing the Design

Lytle has been working with WZMH to create what they call a GENeBLOK, which is a carbon positive concrete block system that stores the wasted energy from the generator test firings and then can provide it to neighboring residences as it’s needed. The GENeBLOK actually decouples the generators from the residential building systems, providing a win-win for all parties.

The GENeBLOK is an electrical connection to the data center generators. The wasted energy from generator testing is fed to motors that are part of GENeBLOK, which also has a system of concrete weights. As the concrete weights are raised and lowered, they regenerate energy through the motors. This energy is then fed to an adjacent battery plant for storage.

This type of gravity storage can be cheaper than lithium ion batteries, including construction, running costs and maintenance, according to a recent article in Science Magazine. But, the technology is nascent, so more data needs to be collected.  

The battery plant is a green energy source for nearby housing. All of this is possible through a DC microgrid that WZMH also designed to provide a more sustainable, resilient avenue of energy for housing as it becomes a greater concern from the climate events that are disrupting service for so many across the country on a regular basis.

“Resilience is the ability of a system to absorb abnormalities without experiencing a permanent change to functionality,” said Lytle. “Buildings need to provide power that occupants need. Today, there usually is a single source and single point of failure. But, with a DC microgrid, it’s multiple, diversified sources. By diversifying those sources, you can significantly reduce the likelihood that they will all drop out at the same time.”

A DC microgrid community is possible now as more of the electronic devices we use day to day are DC-based and the renewable energy systems that we are using more in housing design are also DC-based. WZMH’s DC microgrid community idea includes battery storage systems, like the GENeBLOK, that are capturing energy from a variety of sources.

There are other benefits. A DC microgrid would be able to operate independently if there was a loss of the normal AC, or alternating current, supply from the utility. Plus, DC power distribution can provide efficiency gains due to the reduction in AC/DC transformation.

In the future, WZMH believes that we can build systems that are independent of utility grids. Radewych and Lytle envision many opportunities to tap into the surrounding environment to make it work, such as with flooring that generates power, elevators, body heat from occupants, captured rainwater, recycling artificial light and waste heat, and the list goes on.

“Residential, commercial, and retail don’t all operate the same way or use energy at the same time,” said Radewych. “There is an opportunity to have complimentary conditions to transfer energy when it’s needed.”

One of the world’s thorniest environmental problems—how to limit its human population—has a gentle solution.

“Over time the world realized that you can’t dictate population size to people,” said Natalia Kanem, United Nations Under-Secretary-General and Executive Director of the United Nations Population Fund.

“It’s the woman’s choice. And it’s clear that given a choice, women know exactly what they want: they want the number of children that they can support and nurture.”

That choice is often taken from women, Kanem said, while they are still girls.

“When I think of a girl at a fork in the road, if she is married as a child, under the age of 18, her future is pretty much cooked, and it’s a future that’s going to be one of lack of economic possibility.”

When a girl is prevented from achieving her economic possibility—her creative potential—it limits herself, her family, and her society, Kanem said.

But when she attains it: “She gains not only through personal autonomy but also advances in health and education, income and in safety. So she thrives and so too does her family.”

Kanem appeared yesterday at “One Planet, One Future,” also known as the Nobel Prize Summit, with Nobel-winning physicist Steven Chu, who has advocated educating girls as a solution to population growth and climate change.

“You can’t really talk about sustainability until the world population is stabilized,” Chu said. “In societies where there is rapidly increasing prosperity, increasing education especially among women, and having access so they can control their own bodies, what you find is that the world population in those sectors goes down.”

The United Nations Population Fund works on delivering contraception to the 218 million women that Kanem says want contraception but lack access. Project Drawdown has estimated that giving women access to family-planning resources can save 59.6 gigatons of carbon emissions by 2050. Educating girls could cut another 51.48 gigatons.

The Campaign for Female Education (CAMFED) has undertaken that task in sub-Saharan Africa. In 2013 CAMFED began educating young women as agricultural guides, teaching them to promote sustainable agriculture on their own smallholdings and in their communities.

Tesla stayed profitable in the first quarter, posting earnings and revenue figures that topped consensus expectations, helped by the electric-car maker’s robust first-quarter vehicle deliveries and sales of pollution credits to other automakers. The company also said it’s targeting annual growth in deliveries of 50% a year.

The Palo Alto, California-based company led by billionaire Elon Musk reported net income of $438 million for the quarter that ended in March, with 39 cents of earnings per share on a GAAP basis, and 93 cents per share, excluding some items, beating a consensus estimate of 79 cents a share. Revenue was $10.4 billion, just ahead of equity analysts’ expectations of sales totalling about $10.3 billion. 

Sales of regulatory credits to manufacturers of gasoline-powered cars and trucks rose to $518 million, the company said. That was the most ever for a single quarter. Those funds, which are pure profit for Tesla and nearly impossible for analysts to accurately estimate, have underpinned the company’s profitable streak that’s lasted more than a year after a decade of losses.

The results were a “strong print for Musk & Co.” even though “total revenues were slightly below bullish expectations,” Dan Ives, an equity analyst for Wedbush, said in a research note. “In a nutshell, we believe the (gross margin) performance was a standout relative to Street fears heading into the print,” as the company reported a GAAP growth margin of 21.3% compared with consensus estimates of 21%.

Tesla’s extended streak of profitability comes as it races to expand production in China, open its first auto-production facility in Germany and complete construction of a Gigafactory near Austin, Texas. At the same time, Musk’s company is about to face vastly more competition in every product category as companies including Volkswagen, General Motors, Ford, Hyundai, Nissan and startups such as Lucid and Rivian ramp up or launch sales of their own battery-powered cars and trucks. A push by the Biden Administration to dramatically expand sales and production of electric vehicles in the U.S. means Tesla will have to work even harder to retain its lead in that space. 

The shares gained 1.2% to close at $738.20 in Nasdaq trading Monday, prior to the results release. They were down 2% in after-hours activity to $723.47.

The quarter marked “our highest ever vehicle production and deliveries. This was in spite of multiple challenges, including seasonality, supply chain instability and the transition to the new Model S and Model X,” the company said in a statement. “While the (average sales price) of our vehicles declined in Q1, our auto gross margin increased sequentially, as our costs decreased even faster. Reducing the average cost of the vehicles we produce is essential to our mission.”

Tesla earlier this month reported deliveries of 184,800 vehicles to customers worldwide in January through March, more than double the year-earlier figure when the outbreak of Covid-19 briefly halted production at its plants in California and Shanghai. Still, the sequential increase from 2020’s fourth quarter was just 2.2%.

(Updates to follow from company conference call.)