🚨 Putin's energy retaliation

Plus: An EV exclusive | Wednesday, April 27, 2022

Open in app View in browser   Presented By ExxonMobil   Axios Generate By Ben Geman and Andrew Freedman · Apr 27, 2022 🐪 Hellooooo Wednesday! Today's Smart Brevity count is 1,198 words, 5 minutes.  📬 Did a friend send you this newsletter? Welcome, please sign up. 🎶 This week marks 30 years since pop craftsmen XTC released "Nonsuch," the album that provides today's intro tune...     1 big thing: Coal has lots of staying power Illustration: Aïda Amer/Axios   There's a huge gap between the persistence of coal consumption and rapid moves away from the most carbon-heavy fuel needed to keep global climate goals viable, Ben writes. Driving the news: Fresh data and reporting offer a window into long-term trends, but also recent changes spurred by Russia's war on Ukraine. The big picture: Global coal-fired power rebounded last year to record levels amid high natural gas prices and economic revival from the pandemic, per the International Energy Agency and data-tracking green group Ember. And now the crisis in Europe is pushing in the same direction, even as EU leaders hope to speed their clean energy transition. "Russia's invasion...turbocharged the coal market, setting off a domino effect that's leaving power producers scrambling for supply and pushing prices to record levels," Bloomberg reports. It notes higher coal-fired power use in China — the world's biggest consumer — and other large users including the U.S., India, the European Union, and elsewhere in Asia. AP reports China is "promoting coal-fired power as the ruling Communist Party tries to revive a sluggish economy." Zoom in: The group Global Energy Monitor (GEM) this week published its latest data on coal-fired power plant development and shutdowns. 2021 saw another 18.2 gigawatts (GW) of capacity added to the world's operating coal plant fleet of roughly 2,100 GW, while shut-downs slowed. Another 176 GW of capacity is under construction, per the report from GEM, the Centre for Research on Energy and Clean Air, the climate think tank E3G and other groups. China is driving new plant development. But the report also notes some developed nations plan to operate plants "far beyond the deadlines required by climate science." Threat level: None of this meshes with holding global warming below potentially catastrophic levels. "New investments in coal-fired electricity without [carbon capture and storage] are inconsistent with limiting warming to 2°C or 1.5°C," UN-convened scientists said in a major report this month. Yes, but: GEM sees bright spots in coal phaseout and climate commitments ahead of, and at, last year's UN climate summit. "Only 170 plants (89 GW), or 5% of the operating fleet today, are not covered by a phase-out date or carbon neutrality target," they find. "Still, few of these plants are scheduled to retire on the timelines required by the Paris climate agreement."     Bonus: Charting coal additions and subtractions Reproduced from Global Energy Monitor, et al., 2022, "Boom and Bust Coal 2022"; Chart: Axios Visuals The amount of coal-fired generating capacity brought online last year fell, but again outpaced retirements, new data from Global Energy Monitor shows, Ben writes. Over half the newly added capacity is in China. The report also finds significant amounts in the development and planning stages.     2. Russia deploys its energy lever against NATO Illustration: Brendan Lynch/Axios   Russian state energy giant Gazprom said Wednesday it has halted deliveries to Poland and Bulgaria over their "failure" to pay in rubles, Ben and Andrew write. Why it matters: It's the strongest signal that Russia's war on Ukraine could create an even wider energy crisis for the European Union, which is heavily dependent on Kremlin-backed suppliers. It's also the first time Russia has used its energy supplies to retaliate against NATO members during this conflict. Driving the news: European Commission President Ursula von der Leyen called it an effort to use gas a "blackmail." "[I]t shows once again the unreliability of Russia as a gas supplier. We are prepared for this scenario. We are in close contact with all Member States," she said in a statement. "We have been working to ensure alternative deliveries and the best possible storage levels across the EU," she said, adding the EU is working with international partners to secure supplies. Threat level: Gas prices rose on the news, though analysts said the move is expected to have limited gas market effects. Poland gets most of its energy from coal, and the arrival of milder spring temperatures also eases the impact. But analysts also warned of fresh price spikes if the disputes over payments are not resolved and the embargo widens. "Poland and Bulgaria together losing access to Russian gas has not had a big impact on the total European market, but a more severe consequence is likely if other large countries or individual buyers are being cut off such as Germany and Italy," Rystad Energy analysts said in a note. Context: Poland hosts one of the main logistics hubs for bolstering NATO's eastern flank and transferring weapons to Ukraine. The Washington Post has more.     A message from ExxonMobil Energy for today and solutions for tomorrow     At ExxonMobil, we're working to supply the energy the world needs while also developing lower-emission fuels. Innovations like renewable diesel made from plants could reduce emissions from trucks by about three million metric tons per year compared to conventional fuels.     3. First look: Why clean power is crucial to EV scale-up Adapted from ICF Climate Center; Chart: Sara Wise An ambitious scaling-up of electric vehicle deployment in the U.S. would slash transportation sector emissions, but could paradoxically boost emissions from the electricity sector unless paired with more clean power, a new report warns, Andrew writes. Why it matters: How national, state and local governments implement policies to increase EV adoption while balancing the transition toward renewable energy sources will help determine whether the U.S. can meet its climate goals. The report, from the ICF Climate Center and provided first to Axios, uses five increasingly aggressive decarbonization policy scenarios at the state and national levels to map out potential futures for on-road transportation and the electric power sector. Zoom in: It finds the current pace of EV adoption fails to put the U.S. on track to meet a net-zero transportation sector by 2050. Existing state policies would yield only a 27% decline in on-road transportation greenhouse gas emissions, relative to 2020, it found. Transitioning to 100% EV sales by 2050 could cut emissions from on-road transportation by two-thirds, compared to 2020. If such high EV adoption rates are paired with a large-scale reworking of the electricity grid, the emissions cuts could be up to 82%. Context: The transportation sector has the biggest greenhouse gas footprint of any in the U.S., and any increase in EVs would help reduce those emissions even without a clean grid, the report emphasizes.     4. India and Pakistan heat wave set to intensify   An early-season heat wave is bringing dangerously hot temperatures for hundreds of millions across much of India and Pakistan, Andrew writes. Why it matters: Climate studies show that heat waves are becoming more severe, frequent and longer-lasting around the world due to human-caused climate change. These events are a major public health threat. Driving the news: Heat wave warnings are in place across much of central and northern India for the next five days, with temperatures forecast to keep climbing in these areas. With little air-conditioning access, heat will be a significant health risk, particularly since nighttime low temperatures will remain elevated. On April 27, the city of Wardha, in the state of Maharashtra, recorded a temperature of 45.2°C (113.3°F), while other locations reached the 110° to 112°F range. Some computer models project highs closer to 120°F in northwestern India and parts of Pakistan this weekend. Read more     5. Catch up fast on policy: hydrogen, bulbs, solar 💰 The Energy Department's loan office has conditionally agreed to $504 million in financing for a Utah project that's the "first-of-its-kind clean hydrogen production and storage facility capable of providing long-term seasonal energy storage," DOE said. Go deeper ◀️ DOE unveiled new efficiency standards to phase out high-energy incandescent lightbulbs, marking a reversal of a Trump-era policy, Axios' Erin Doherty reports. Keep reading 😬 Potential new U.S. tariffs on Chinese-linked solar panel imports are causing significant project delays, the Solar Energy Industries Association said, citing a new member survey. It warns of a 46% cut in new installations in 2022 and 2023.     A message from ExxonMobil We're working to ensure energy security and advance innovation     At ExxonMobil, we're working to produce the energy the world needs today, while developing new, engine-ready fuels for tomorrow. Solutions like renewable diesel, advanced biofuels, and eFuel made with captured CO2 could help reduce emissions by up to 85% compared to conventional fuels.   Thanks for reading and see you back here tomorrow. Like this email style and format? It's called Smart Brevity®. 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