Now that a new Jewish year has begun, it is time to reflect on the one that has just ended. From the point of view of a climate entrepreneur, I find many reasons for optimism. The road to net zero is still long and challenging, but for one day, let us relish in the good things that happened:
- The Inflation Reduction Act: Last month, the most significant decarbonization stimulus package in history was legislated in the US. The IRA augments the economic incentives for reducing emissions with $369 billion dispersed all over the spectrum of low-carbon solutions: from electric vehicles and proliferation of renewable energy to industrial point source carbon capture and sequestration projects and stand-alone carbon dioxide removal facilities.
- Growing Renewable electricity generation: An IEA report from May [1] predicts that renewable electricity generation is expected to increase by 8% in 2022. Moreover, the adoption of policies worldwide further supports the continuation of this growth in the future. There are still technological gaps in the way of a stable, fully-decarbonized grid. Still, the proliferation of renewable energy generation is a strong incentive for innovation that will enable that.
- Decreasing Chinese emissions: The CO2 emissions of China, the most populous nation and most significant CO2 emitter, have fallen by 3% between July 2021 and June 2022 [2] (in absolute numbers, this is a staggering 380 megatons of CO2). Unfortunately, Covid restrictions and recessions are the main drivers of this decrease, so it may not be sustainable. However, China has a proven track record of speedy infrastructure upgrades and reforms. Therefore, this decrease in emissions, even if transient, buys valuable time during which China can implement decarbonization technologies to maintain and augment this reduction.
- Accelerating carbon dioxide removal: Frontier climate, a coalition of five industry giants (Stripe, Meta, Alphabet, Shopify, and McKinsey & Company), and Microsoft are revolutionizing carbon offsetting by committing billions of dollars for high-quality carbon credit purchases. These companies provide standards, an early market, and, together with the IRA, a strong incentive for developing effective carbon removal technologies. Unsurprisingly, this year, carbon dioxide removal fundraising (led by Climework’s $650 million round [3]) and project announcements (led by the five megaton/year Project Bison [4]) broke all records.
- Climate-tech is attracting talent: According to a new report [5], in Israel, a global leader in technology innovation, the share of climate-tech startups out of all startups has steadily risen since 2014, reaching 9% in 2020. Considering the increased climate awareness, I believe the climate space will continue attracting top-notch talent. Hopefully, that will pave the way to a carbon-neutral and sustainable future.
climatetech #carboncapture #renewableenergy #netzero #greeneconomy #innovation #climatechange
