Climate News Weekly is back to cover the week’s biggest stories in climate news. Emma Crow-Willard and co-hosts Julio Friedmann (Carbon Direct) and Heather Clancy (GreenBiz) begin by discussing why the OECD’s $100 billion in climate finance for developing nations is better late than never. Later, the team covers international stories, including record-breaking temperatures in New Dehli and Kenya’s president visiting the United States to discuss climate goals and trade. Next, our hosts cover the US Department of Energy’s announcement of its principles for integrity in the voluntary carbon market. The team rounds out this week’s news by digging deeper than the headlines on Microsoft’s emissions hikes, attributed to the company’s AI operations – but not for the reasons you may think.
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Contact us at contact@climatenow.com
Visit our website for all of our content and sources for each episode.
Climate News Weekly is back to cover the week’s biggest stories in climate news. Emma Crow-Willard and co-hosts Julio Friedmann (Carbon Direct) and Heather Clancy (GreenBiz) begin by discussing why the OECD’s $100 billion in climate finance for developing nations is better late than never. Later, the team covers international stories, including record-breaking temperatures in New Dehli and Kenya’s president visiting the United States to discuss climate goals and trade. Next, our hosts cover the US Department of Energy’s announcement of its principles for integrity in the voluntary carbon market. The team rounds out this week’s news by digging deeper than the headlines on Microsoft’s emissions hikes, attributed to the company’s AI operations – but not for the reasons you may think.
Follow us on Twitter, LinkedIn, Facebook, and Instagram.
Contact us at contact@climatenow.com
Visit our website for all of our content and sources for each episode.
Emma Crow-Willard: [00:00:00] Welcome to Climate News Weekly at Climate Now. I'm Emma Crow-Willard, in for James Lawler today and today I am joined by our regular guest host on this program, Julio Friedman, and then also Heather Clancy, the editor at large at Green Biz. And we're excited to have both of you on today for Climate News Weekly.
Heather Clancy: Great to be here.
Julio Friedmann: Always a pleasure, Emma.
Emma Crow-Willard: We have a lot of articles this week that we want to try to get through. There's been a lot, uh- the past two weeks rather- that has been going on at the federal level in the US and around the world. So let's dive in starting with an article looking at the 100 billion plus dollars that OECD countries had committed to help developing nations in adapting to climate change and preparing and capacity building and all of these different efforts. We did get to that number, but two years late.
Julio Friedmann: [00:01:00] So I consider this to be an unvarnished success. This is just great, great news. The fact that we made it at all is a big deal. The fact that we are only two years late is miraculous given the combination of COVID, Russia, Ukraine, uh, inflation, all these other things.
The OECD countries still stepped up and still made this finance available. Uh, it's, it's a big honking deal. It also goes to remind us that, uh, even though we are all on the clock and even though climate change is an incredibly urgent problem, delay of one or two years is not that big a deal. So if we are, have a particular target for say, solar power or clean hydrogen, or whatever it is, and instead of 2030, it happens in 2032, that's good news. Because all of these tasks we have set for ourselves are very difficult and Herculean. So when any one of them is accomplished, even a little late like this one, it's just [00:02:00] cause for celebration.
Heather Clancy: Yeah, and it's really good now with, with all of the climate impacts we're feeling that this money is going, because that's, I mean, don't forget, this is partly for adaptation, right? So what can these countries do to prepare? And that's super important. And it probably, you know, to your point, Julio probably did get those, those wallets to open.
Emma Crow-Willard: That's great. I don't know if either of you had anything to say on the article that looked into like, is the money even going to these countries or is it coming back to the OECD countries?
Julio Friedmann: Right so this is a fair point, uh, and worth discussing. In many cases, the financial commitments that have been made actually end up being loans to the country in order to come back to the country that's giving the loans. So I'm going to arbitrarily choose Japan, for no particular reason. Let's say Japan puts 20 billion on the table, they will put that forward in the form of [00:03:00] loans to other countries, which will then come back and make a return to Japan. This is not ideal for a couple of reasons. The main one being that, uh, already many developing nations are just saddled with debt.
Debt forgiveness programs don't deploy clean energy. It just means that they've already paid the debt three times, so they have to stop paying the fifth time like that doesn't help them very much. We need to start getting smarter about how to get these things going. That said, if there are investable projects in many countries, and indeed there are, this is a way to get those projects rolling in a way that was impossible earlier.
Heather Clancy: Yeah and it could pull in more private sector money, if that's the case, you know, it's not just public money.
Julio Friedmann: It most certainly will.
Emma Crow-Willard: Yep. That's great. And to your point, Heather, about, um, this, some of this funding going towards adaptation in these nations, uh, this week was crazy record temperatures in Asia with New Delhi [00:04:00] recording its highest temperature ever. Very hot in a place that's already humid, has terrible air pollution, and a bit of a urban heat island effect. Um, meanwhile, also in Pakistan, temperatures got about as high as well.
Heather Clancy: I mean, like I said before, it's a human problem, right? People are dying. We are seeing impacts from climate change in which people are, are compromised and that's what's getting the money, I think, flowing. I mean, Julio's looking a little skeptical, but, um, you know, I just, I think that might be part of what's finally got the money flowing, but I don’t know.
Julio Friedmann: So these impacts are terrible and we're seeing them. In the case of India, there have been so far 29 deaths attributed to the high temperatures in Delhi.[AM1] I'm sure that number is small. I'm sure there are many more deaths.
Heather Clancy: Many more, under-[00:05:00] unreported deaths, yep.
Julio Friedmann: Yes, or underreported. Uh, it is the case as well that, uh, Kim Stanley Robinson selected uh, Northern India as the place to start his book, Ministry of the Future, because this is predictable and predicted.
This was always going to be a place with a wet bulb temperature, which we discussed in a prior, uh, episode, uh, is going to be terrible and really affect human beings. I am more skeptical than Heather is about the fact that the money is flowing because of people dying. I remember 10,000 people died in France in 2003 because of heat waves, didn't move the needle.
We have a climate catastrophe every year, we have had a climate catastrophe every year for decades. For over 30 years, we have had energy catastrophes every year for the last 30 years. I don't think that this particular issue is, is what's driving it. I do think that what is changing is that governments are on the hook.
I think that businesses are making commitments that are very big and binding. I think the [00:06:00] laws are changing. I think this combination of things is, is coming together. And, as we have all globally, together, taken this adventure and journey together, we've discovered just how inadequate we have thought about developing countries in the Global South and these other areas. That awakening has been late but has been real, and I think that that is in part driving these changes.
Emma Crow-Willard: Speaking of the Global South, uh, you flagged a story, Julio, about the Kenyan president doing a visit to the U. S. aiming to attract green investment.
Julio Friedmann: Yeah, I'm very excited about this story and shout out to not only President Ruto, but a lot of people who, uh, worked to help get him there.
I would point to Africa Climate Ventures and Mr. James Mwangi. I would point to, uh, Climate Action Platform Africa, uh, and the leadership there like, uh, uh, the Great Carbon Valley people, Octavia Carbon. There's been this long, persistent set of activities going on in Kenya. In [00:07:00] some cases, nature-based CO2 removal, in some cases, clean energy, and President Ruto has basically said we are going to use this resource base and clean energy and other natural resources and human capital to pole vault into green industrialization.
Kenya has a particular issue, uh, it is not access to clean energy, they have access to clean energy. Their grid is 95 percent clean today, period. The problem is there's no market. They can't grow their clean electricity market because there's no demand. The people in Kenya aren't wealthy enough to buy enough electricity so they've embarked on a strategy of green industrialization, whether it's aluminum smelting or steelmaking or direct air capture or geothermal energy to make fossil fuels, fertilizer, like they are going full out, e-methanol for shipping fuels. They're really going after there and they're taking. The technology advancements of the last decade and trying to put them to [00:08:00] work.
And the fact that they came to the United States to discuss finance, to discuss trade, to discuss investment is the right thing. The fact that the United States marshalled at this level, that they had secretaries and deputy secretaries and the presidential thing, a joint meeting of Congress shows how vital this is in terms of the opportunities in that country for American businesses and for trade. And last but not least, it's a big geopolitical opportunity as well. Uh, people have been lamenting China's presence in Africa for many years. The asymmetry that Chinese debt has provided Chinese infrastructure companies, all these other things, this looks like the opening counter gambit.
Heather Clancy: Hey, Julio, was that where the Climeworks, uh, facilities going in?
Julio Friedmann: So there is an announcement by Climeworks to build a plant in Kenya and it will be built at the Hell's Gate National Park, uh, which is, uh, just north of Nairobi. Uh, and that is one of the best geothermal [00:09:00] provinces in Kenya. And in point of fact, they're using the same thing they're using in Iceland.
They're using geothermal heat, geothermal electricity to do it and they're storing in basalts. Uh, interesting U.S. companies are involved in that. A company called Silixa is doing the storage work. Um, there are researchers from Stanford and others sort of getting involved in this. Uh, and in addition to that, they are also looking at using, uh, other, uh, direct air capture companies.
So, suddenly 10 companies from around the U.S. and around the world are like, “Hey, let's go to Kenya, there's something going on there”. Um, uh, among other things, that includes their own indigenous technology. Octavia Carbon is a technology company very similar to Climeworks. Uh, it's adsorption-based, uh, vacuum swing adsorption system uh, and they have moved very fast and very far in just 18 months. A very impressive little company.
Part of what makes this story work, uh, is in fact the workforce. They have a well-trained, hungry workforce that [00:10:00] just wants to dive in and do this stuff. And, uh, they've been trained around the world, but also at University of Nairobi, electrical and chemical engineers, finance and business people, they are ready.
Emma Crow-Willard: Speaking of carbon dioxide removal projects, there's been a lot of announcements recently out of the U.S. government, including, uh, the DOE announcing the Carbon Dioxide Removal Purchase Pilot Prize Phase 1 Semifinalists. Also big thing that I want to focus on is that The White House announced the voluntary carbon markets’ Joint Policy Statement and Principles. And, um, Heather, you wrote an article about this in Green Biz, so maybe you could start us off with what it is, and I know, obviously, Julio works very deeply in this, so he'll have a lot of things to say as well, so lots to talk about in this space.
Heather Clancy: Yeah. So, big announcement. I will say I just use the word principles, and that's what this is. It's a non-binding statement by the federal [00:11:00] government about what they expect out of voluntary carbon markets. So this is basically giving the corporate world cover to be able to use these things in their emissions reduction strategies.
Um, there's been a lot of, um, as Julio and, and many others are very well aware, uh, critics of, of this model. The voluntary carbon markets, questions about the integrity of projects, um, in, in certain, um, areas of the world, just, just been criticism leveled at, at what's going on there. Predominantly, focused on places where the credits are very hard to measure, right, which is in a lot of places, but where we're not really sure how valuable they are.
So companies are paying, uh, for projects that they are going to use to offset, you know, some, some emissions in their, in their inventory. What this is really doing is saying, “Okay, folks, you can use these things, but they have to be, they have to look like this. [00:12:00] They need to be durable. They need to be additional”.
Many of the things that you would say are high integrity and um, you know, I don't need to completely geek out on that, but, uh, more importantly, it really specifically addresses the corporate buyers. Saying, “Okay, you can use these things if they're focused on these certain areas and if you talk about them in these ways”. So it's trying to, number one, give them a signal that there will be markets developing for things like sustainable aviation fuel, um, more, uh, other carbon removal technologies.
So it really helps corporations understand that that's probably going to be okay, but they have to be really careful about how they declare them and disclose, and they also do need to be more transparent. It does provide a better, uh, signal of where the administration is going to come down, partly because they also want to invest. And so, they want there to be private sector money coming in. And if, if, if they don't provide more clarity, um, that money is not going to come [00:13:00] into these projects.
Julio Friedmann: So let me take a step back before speaking to some of the points that Heather raised. Uh, big step back, this is a real maturation and acknowledgement of the key role of CO2 removal, period.
Uh, it is not just like some dodge, or some get out of jail free card. It's the opposite. It's important to work for climate and having three cabinet secretaries and the special envoy make that announcement reaffirms that point.
Heather Clancy: Yes. Right.
Julio Friedmann: Right. This was not the B team. This was Secretary Yellen, this was special envoy John Podesta, this was Secretary Vilsack from Agriculture, Secretary Granholm from energy. All heavyweights, all saying the same thing. A whole of government approach for the need for CO2 removal. Second thing, to Heather's point, talks about the importance of markets. Why it is you actually need to bring private money into this arena, we need trillions of dollars to get the job done. Having that clarity, having that confidence is what brings money into the market.
Third, like Heather said, these are principles. I would [00:14:00] have liked to have had protocols and standards, but protocols and standards are deeply technical tasks that take a long time. Principles is good. And the principles are pretty straightforward. Uh, one, focus on reductions first. Two, if you're going to be buying CO2 removal, you can apply it to scope three. This has not been certain. And actually it was misreported by Bloomberg in their story, they were like, “You can't use it on scope three, like, nope”. The White House fact sheet says pretty clearly you can use it on scope three. But you can't use it on your scope one and two emissions, which is also good practice.
The need for transparency that Heather talked about is an important principle, these kinds of things. Um, I would say that also they don't use the word offsets.
Good for them. They shouldn't be using the word offsets. These are not about, you know, buying indulgences. This is about reducing your irreducible emissions.
I do want to draw attention to one particular thing, which is in fact the semifinalist announcements for the Department of Energy Government Procurement Program. We've talked [00:15:00] about that a bit before in the past like, uh, the fact that government is buying this stuff is great because this is how you get technologies to market. Government procurement has helped semiconductors, fuel cells, batteries, LEDs, solar panels, like, you get down the cost curve through government procurement, this is another service they're buying that's great.
Second of all, the work of choosing the semifinalists and the finalists actually is the first step in making standards. It's the first step in making protocols, because you learn what the government considers quality to be. Third, that program unquestionably becomes something that other companies can pick up on because they're like, well, if it's good enough for the government, then we can think we can feel comfortable about buying these sorts of things.
And to point to fact, there is a voluntary carbon market challenge the Department of Energy has put out. They're saying, “Hey, companies come match us”, we're spending 35 million and Google has already matched it. They've said, “We'll do 35 million too”. Other companies are looking at this, expect [00:16:00] announcements in the next couple of months but uh, we're going to see, uh, the fact that this money from the government and the tracks that they lay in procurement become a signal that enables the crowding in of private money.
Heather Clancy: Can I also tie this back to something you were just talking about? Because, uh, the other point of this is to also say it's okay to do things in, like it's okay to invest in emerging economies and these, these, these, um, developments like what you were describing before in Kenya, this also points back to saying like, “Hey, companies, it's cool to invest in those things, we're going to invest, you should invest”.
So it, you know, I think it also goes full circle of the money, not just staying in the United States or, you know, wherever, but going to these places that desperately need investments in climate solutions.
Julio Friedmann: Yes, absolutely. And it de-risks those purchases and those investments. Uh, [00:17:00] something we didn't mention about Kenya earlier, U.S. government's put 180 million dollars on the table, that's good news. Like, that'll, that'll get some money going too. So again, these things the non-dilutive capital, the risk reduction, long term and tenure loans, all of these things really end up mattering. And it's nice to see this as sort of the final component of things like the IRA and the Bipartisan Infrastructure Law that we've talked about so much here. This kind of broader financial sensibility, this all-inclusive whole of government approach is the right way to go on a lot of these things.
Emma Crow-Willard: And our last story today, let's talk a little bit about AI and climate and how it's impacting emissions, et cetera. There was a story out of Bloomberg that said that Microsoft's climate emissions are now 30 percent higher than they were in 2020 because of this AI push. Um, and that seems a bit concerning, uh, but maybe AI is actually good for climate. What's going on here?
Julio Friedmann: So, the first thing I want to [00:18:00] explain in this story is there's a common misconception about this. The increase in Microsoft's emissions is not from the energy or electricity use, it's the scope three emissions. It's just from building it. It's from the concrete and chip boards and stuff like that okay. So it is not about AI energy consumption, quite the opposite.
Microsoft put 10 billion into buying renewable power so that they would have zero carbon electricity. The thing that's interesting about this story is that no company has been more proactive on climate than Microsoft, none, and still their emissions went up, right?
And it's not because they're not paying attention. We know this because they are totally open kimono and transparent and sharing all this information. But it shows how hard this is. Even if you have zero-carbon electricity, if you're building things, emissions go up. That's, for me, the punchline of this story, and it's not necessarily about AI. We'll get to that in a second. It's about the [00:19:00] built world.
Emma Crow-Willard: Yeah.
Julio Friedmann: And we have to tackle these things comprehensively. And we can't electrify everything, as we are learning, because there's not enough green electrons to electrify everything. Even in the data centers, we don't have enough green electrons.
In parts of the country, we are anticipating a 70 percent rise in natural gas emissions because of the power demands from data centers. Um, and at the same time, the AI are giving us health. They are giving us improved ability to integrate renewables on the grid. They're getting us efficiency improvements of all kinds.
There are real, human benefits and climate benefits that come from the AI applications, I have written a report on that, in the process of writing a second report on that. There's now many of these reports out there. Um, still, I like this story because it highlights just how challenging every, all of this stuff is. Um, there is no silver bullet. There is [00:20:00] no inevitable glide path to a green world. We're all going to have to work hard for a long, long time.
Heather Clancy: Yeah. So just to add a few things because I did cover that Microsoft story myself, and it's because of concrete and all those things that, that Julio was just mentioning.
The thing about AI is, is much of the energy consumption comes in the training of AI and the models and as it's getting set up. And so I think what we'll see is a lot of focus on how software development improves to make that less, right? So there's a lot of that work going on. The other thing to know, aside from the things that Julio mentioned is potential applications, big, big deal in the sustainability community.
We're seeing this as a way of, of actually having better knowledge about what's actually being decarbonized and how. Um, back to the carbon markets, um, using AI and satellite imagery and so forth to be able to, to determine and really see and verify, [00:21:00] uh, that these things are working, that, that the carbon is being removed, that these things are growing, uh, in the case of a forest and getting better information and also to be able to see emissions. Um, so AI is going to be a huge, uh, benefit to the gathering of data about these initiatives.
Julio Friedmann: And one last bit to tie it all together. Microsoft announced last week, a billion-dollar investment in data centers in Kenya.
Heather Clancy: I didn't know that one! That’s wow- thank you for mentioning that.
Julio Friedmann: Yes. And they're going to use geothermal energy and wind power to power it, uh, which is as they should. And it's entirely because it's a training data center, it's for the low latency stuff. So, uh, it’s really nice to see these things coming together. It makes me optimistic that we're making broad progress in the world.
Emma Crow-Willard: That's great. Awesome. Well, thank you, Julio. Thank you, Heather, so much for hopping on and thanks everyone for [00:22:00] listening.