May 3, 2022
Photo: Diego Jimenez/Unsplash
Hello, and welcome to your Protocol Climate newsletter. We’re calling it the Pulparindo of newsletters: spicy, sweet, sour, a little salty. (Sorry, your Climate editor is obsessed.) But you didn’t come here for Mexican candy reviews, did you? Instead, we’re diving into where the government should invest in direct air capture, what iPhone inventor Tony Fadell thinks about the climate and capitalism, and the Biden administration’s next EV play.
Silicon Valley gets all the headlines about carbon dioxide removal, but the federal government is quietly out here putting venture capitalists to shame. The Department of Energy is sitting on $3.5 billion in funds for direct air capture hubs that it can hand out between now and 2026 to help scale up the nascent technology.
That money was outlaid very quietly compared to the more than $1.2 billion in splashy cash the Valley offered up last month, yet Erin Burns, the executive director of Carbon180, told Protocol the plan would increase global direct air capture capacity 400 times over. (Pro tip for the government: Hire better PR people. Actually, scratch that, my inbox couldn’t handle it.) Anyway, now comes the hard part: spending it the right way. A new report from Carbon180 offers some ideas for how to do just that.
The DOE program is basically a slumber party for CDR. By creating hubs, the program brings companies working on a technology that we know we’ll need at some scale in the coming decades to one place. This has a few advantages.
Finding the right locations will be important, and Congress has given the DOE some marching orders on that front. The money for DAC hubs has some stipulations attached to it. Among them are ensuring there’s geology conducive to stashing carbon dioxide underground, a history of fossil fuel extraction and a local need for good-paying jobs.
And backing the right horses is tricky. There are more than a few ways to suck carbon from the air and store it. So the Carbon180 report makes the case for not betting on one or two silver bullets, but taking the “thousand flowers bloom” approach — and actively tending the garden.
Also required: getting people engaged early and often. Ensuring that people understand what DAC is and incorporating their feedback into project development is high on Carbon180’s list of recommendations. No shade to venture capitalists and companies like Stripe at the forefront of the carbon removal revolution in Silicon Valley, but their only actual obligation is to make money. The federal government has an obligation to the people, and it can use that weight to ensure the DAC development process is transparent to those living near the machines that could help save the climate.
Ultimately, Burns said “having the federal government come in and help define” regulations for DAC and ensuring communities are engaged could influence how the money flowing from Silicon Valley to carbon dioxide removal is spent. If the government requires projects at the hubs be made with American steel or employ unionized workforces, for example, it will set the agenda well beyond the hubs themselves.
“DAC companies are going to listen to that. It’s $3.5 billion, right?” Burns said. “[The hubs are] going to help change how these direct air capture companies think about scaling up.”—Brian Kahn (email | twitter)
The man who invented the iPhone believes capitalism caused the climate crisis. He also believes staunchly that, with some tweaks, the system can work for the planet. In Tony Fadell’s eyes, the relationship status between the climate and capitalism is best summed up by, to borrow a Facebookism: “It’s complicated.”
I recently got the chance to chat with Fadell, who also invented the iPod and Nest thermostat and is currently a principal at Future Shape, an investment and advisory firm that coaches technology startups. We discussed how the climate crisis has prompted a shift in his approach to investing and inventing; he is now putting “existential problems” front and center.
This excerpt of our conversation was edited for brevity and clarity.
In the years since the development of the iPod and iPhone, I have heard concerns about the environmental impacts caused by our attachment to technology. How do you reconcile the development of hugely impactful consumer technologies with your very vocal concerns about the environment? Do you think the way we develop technology may need to shift?
I think the way we consume technology might need to shift. We don't need to see new cell phones every year; my cell phone right now is not the latest iPhone.
When we were creating the Nest thermostat, we wanted to make sure that it sat on your wall for 12 to 15 years, which was the typical lifespan of those types of products. We made sure we had the software update and various hardware in it so it can live that long. As designers, as engineers, as businesspeople, we need to think about making sure we're extending the lifetimes of products. And even then, we need to think about circularity and what's going to happen at the end of a product’s life.
You have said that the world’s first trillionaire will be someone who fixes climate change. Can you elaborate on why you say that? Is this something that you think capitalism can fix?
I think if capitalism isn't a part of it, we're not going to fix it. The reason why we got into this state was because of capitalism: We didn't make the right decisions to stop emitting carbon dioxide, because it was the cheapest and easiest way of just scaling up the things that we already had. I'm not saying capitalism is bad, but the incentives were wrong. The only way we're going to solve this is with proper regulation and government intervention to make sure we're aligning incentives and make sure that capitalism is working with the solutions as opposed to against them.
The reason why I think that a trillionaire will be produced out of the climate crisis is because we are talking about an existential problem not just for one country or for one city: We're talking about the entire planet of billions of people. Most of these people are using the same exact resources or technologies to power their homes and businesses. Those things need to be revolutionized, not over a span of 100 or 150 years — which is how long it took to create these systems — but in the next 20 years. That's trillions of dollars of capital. And it's not just one industry. It's every industry that needs to be addressed. That's the scope and scale of problems that we have on this planet; there will be some people that will fix them, and they will reap the benefits.email | twitter)
M&A and workforce reorganization can create a wealth of opportunities for companies seeking rapid growth, transformation and market expansion. In fact, 47% of executives say pursuing corporate M&As, joint ventures and alliances is their top growth driver in 2022. Unfortunately, nearly half of executives say talent acquisition and retention challenges are the biggest obstacle.
The battery news just won’t stop coming. On Monday, the Biden administration announced plans to remedy the ongoing battery shortfall by devoting $3.16 billion to domestic lithium-ion battery manufacturing, processing and recycling. The disbursement, which was authorized by the bipartisan infrastructure law, will be doled out in the form of cost-share grants to private U.S. companies.
Most of the advanced batteries that U.S. electric vehicle manufacturers rely on currently come from outside of the country, with China being a major supplier. This is largely because the U.S. is still lacking a cradle-to-grave battery supply chain, prompting concerns that it could become dependent on foreign sources for the long haul. As the wild ride of nickel (due to Russia’s invasion of Ukraine) shows, a too-concentrated supply chain could spell disaster for the EV industry, which is expected to grow rapidly in the coming years. Consider the more than $3 billion a down payment on a smoother ride as we cruise toward an all-electric vehicle future.— Lisa Martine Jenkins
Tech regulation is fast coming over the horizon. Companies everywhere are bracing for new privacy legislation and antitrust action, but much of the focus thus far has been on how the biggest tech firms will fare. What about the rest of the sector? How should the thousands of small, medium-sized and enterprise-level tech companies prepare for this new regulatory landscape? Will changing policies bring about a more even playing field, or will growth be stunted for smaller businesses with fewer resources? How should the U.S. avoid one-size-fits-all regulation in such a diverse ecosystem while still checking unfair competition and data abuses? Join Protocol and a panel of experts as we dive into the biggest regulatory priorities of the not-quite-biggest tech companies. RSVP here.
ProEdge can help you conduct a skill gap analysis across your organization and gain insights you can leverage to develop forward-looking plans while taking into account the needs of the entire enterprise, including individuals, teams and functions. In an M&A scenario, an upskilling program like ProEdge can also be used to uncover employees’ skills that weren’t utilized before.
California’s last nuclear plant could get a new lease on life. Gov. Gavin Newsom would like some of that $6 billion in federal money to save the nukes, please.
The Golden State also hit a big renewable milestone. Big day for California clean energy news: The state met nearly all its electricity needs via renewables. Sure, it was for three hours on one day last month and there are some other caveats, but we’re taking what we can get, OK?
Joe Manchin is once again Joe Manchinning. Between wanting to kill EV tax credits once and for all and meeting with a bipartisan group of lawmakers with unclear climate intentions, the West Virginia senator is operating at peak capacity.
Sustainable aviation fuel isn’t a sustainable business yet. Startup Prometheus Fuels has raked in cash and made splashy deals to sell its sustainable aviation fuel, but the company’s plans are “laughable,” according to experts. Oops.
Click this link if you want to see cow burps from space. 13/10 sentence. No comments needed.— Brian Kahn
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