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Hello!
Before diving into today’s newsletter that focuses on U.S. President Joe Biden’s announcement on the ‘climate emergency’, I have my own announcement to make. I’ll be taking a break next week, and Sustainable Switch will be switched off while I am gone. But rest assured, I and the newsletter will be back with all the latest ESG news in your inbox as usual on Aug. 2.
Now, let’s get straight to it!
Biden described climate change as an emergency on Wednesday, but stopped short of a formal declaration, announcing a modest package of executive actions and promising more aggressive efforts to come.
Biden made the comments during a visit to Massachusetts as a historic heatwave battered Europe and the United States. Some 100 million Americans from New York City to Las Vegas will be under heat warnings this week as temperatures rise well above 100 Fahrenheit (38 Celsius), part of a trend of extreme weather made worse by climate change.
"Climate change is literally an existential threat to our nation and to the world," Biden said. "This is an emergency, an emergency, and I will look at it that way." The Biden administration said it had identified 700,000 acres for possible offshore wind energy development in the Gulf of Mexico, seeking to expand a growing clean energy industry to a major U.S. oil and gas hub.
It also said Biden would direct his Interior Department to move ahead with offshore wind development in areas of the Atlantic coast where former President Donald Trump had banned oil and gas development.
Still, those actions fall short of demands by Democratic lawmakers and environmental activists who want Biden to formally declare a climate emergency, which would enable the use of the Defense Production Act to ramp up production of a wide range of renewable energy products and systems.
Democrats and climate activists suffered a blow last week due to the collapse of U.S. climate legislation. Senator Joe Manchin's decision to halt support for President Joe Biden's climate law also affects the development of clean-burning transportation fuels, investors, lobbyists and analysts said.
The U.S. biofuel industry was banking on legislation that would boost investment in fuels such as sustainable aviation fuel (SAF), made from animal fats, greases and oils, and produces fewer carbon emissions than traditional jet fuel. U.S. fuel makers have been increasing output of cleaner-burning fuels for industries that are harder to electrify. Renewable diesel production is profitable due to state and federal financial incentives, but SAF is two to five times more expensive than jet fuel.
Biden’s announcements come as the North American Electric Reliability Corp (NERC) said that key entities of the U.S. power grid network were working to improve resilience of the power grid network as climate change drives more extreme weather. Natural gas generators are now needed for the reliable integration of renewable power until new storage technology is fully developed and implemented at scale, the NERC said.
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A worker inspects solar panels at a solar farm in Dunhuang, 950km (590 miles) northwest of Lanzhou, Gansu Province September 16, 2013. REUTERS/Carlos Barria
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Breakingviews: Australia is pledging action after a grim report detailing Down Under’s deteriorating environment. But coal and gas exports help fuel disasters at home and abroad, including Europe’s wildfires. Refusing to tackle it sends a gloomy signal about countries’ willingness to cut emissions.
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Karen Weigert, director at the Baumhart Center in Loyola University Chicago’s Quinlan School of Business
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“The United States and Europe are suffering through extraordinary heat waves. Temperature records, some of which were set in recent years, are being shattered.
“Within a city, temperatures are not uniform. Neighborhoods that were historically redlined – denied access to capital – are hotter decades later. And heat, sadly, is the deadliest natural disaster.
“Global challenges, like climate change, are felt in daily lives and in local settings. Business decisions to emit greenhouse gasses or lend capital change lives. With a lack of national climate policy, companies are uniquely positioned to merge profit and purpose, to build a cooler future – for everyone.
“How to do it? Establish ambitious climate plans as part of ESG – push for net zero and beyond, to regenerative. In the process add an equity lens to the key decisions. Partner with impacted communities and deploy solutions that create clean air, local jobs and cooler temperatures.
“Heat up the economy – not the neighborhoods.”
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South Africa, where daily blackouts are a fact of life, knows better than most that it cannot rely on coal power. After a six-year hiatus, the country in 2021 held a bidding round for companies to operate wind and solar projects, attracting aggressive offers from more than 100 renewables companies, eager to make up for the shortfalls of state power generator Eskom.
The problem for the companies that saw opportunity in South Africa's energy needs is they agreed to supply power at tariffs so low they stand a minimal chance of making a profit under current conditions.
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British Business and Energy Secretary Kwasi Kwarteng has appointed Jane Toogood as the UK’s first Hydrogen Champion (subject to agreement of final terms). Her responsibilities include bringing industry and government together to realize the government’s hydrogen ambitions – including supporting up to 10 gigawatts of hydrogen production capacity by 2030, aiming to run annual allocation rounds for electrolytic hydrogen, and designing a new business model for hydrogen transport and storage infrastructure by 2025. Toogood is currently the sector chief executive at British multinational chemicals and sustainable technologies company Johnson Matthey.
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Morrison & Co, a global infrastructure investment firm, has appointed Lauren Beshore as an investment director. Based in New York, she will serve as deal team lead, and oversee origination and execution across several key infrastructure sectors, including energy transition, logistics and utilities. She previously served as vice president of the global infrastructure opportunity fund at the Carlyle Group, an American multinational private equity firm.
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Global property consultancy Knight Frank has hired Joe Warren as an associate in its ESG consulting team. He will provide insight into UK ESG regulation, carbon reduction strategies and sustainable building solutions. Warren joins from MITIE, a British energy services company, where he spent seven years specializing in technical energy solutions.
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Deutsche Bank has hired Jörg Eigendorf to the newly created position of chief sustainability officer. Eigendorf joined the bank in 2016 as global head of communications & sustainability. Before joining the bank, Eigendorf worked at German television network WeltN24 for more than 16 years, holding various roles from correspondent to chief investigative reporter.
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“There is a lot of focus on ESG policies, but I would argue the primary focus should be funding venture capital firms with diverse managers and supporting their investments. We will have better ESG if more women and people of color are leading venture investments.”
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Krista Morgan, general partner at Stage, a UK-based majority female-led private equity group
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The South African government's climate change taskforce head, Daniel Mminele, will provide an update with visiting climate envoys from the European Union, the U.S., the UK and others on the country's energy transition plan later on Thursday.
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German Foreign Minister Annalena Baerbock will conduct a town hall on the country's security strategy in Munich on Friday.
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The UK parliamentary committee examines what went wrong in the energy market that led to many providers going bust and whether current support packages are sufficient to see people through the winter on July 26.
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The Nigeria Labor Congress (NLC) will embark on a two-day protest on July 26 against a six-month shutdown of public universities across the country due to pay disagreements between the government and teachers.
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