By the time President Joe Biden articulated it officially Thursday on Earth Day, the new U.S. pledge to halve emissions over the next nine years was one of the worst-kept secrets in climate action circles.
Neither was it surprising that the U.S. president closely linked America’s new nationally determined contribution, a reduction target of 50 to 52 percent from a 2005 baseline aligned with the terms of the Paris Agreement, with equitable job creation and the opportunity to make money. “The countries that take decisive action now to create the industries of the future will be the ones that reap the economic benefits of the clean energy boom that’s coming,” Biden said in his opening remarks during the virtual two-day climate summit.
Attended by more than 40 world leaders, the event last week included both close allies and representatives of countries whose cooperation will be critical to keeping global warming well below 2 degrees Celsius by 2050, including Brazil’s president, Jair Bolsonaro; China’s president, Xi Jinping; India’s prime minister, Narendra Modi; and Russia’s president, Vladimir Putin.
But the Biden administration’s high-level mantra — that the clean energy transition is linked to an unprecedented economic opportunity — was also well punctuated with virtual visits from a wide range of individuals representing the private sector. Among them: billionaire philanthropist and venture capitalist Bill Gates; new Citi CEO Jane Fraser; Oliver Bate, CEO of insurance giant Allianz; and Marcie Frost, CEO of CalPERS, the largest U.S. pension fund.
“Some think that confronting climate change and creating jobs and economic inclusion are in conflict,” Fraser noted in her remarks. “But we believe we will only be successful in tackling our global challenges if these agendas are working together. Solving climate change must be a driver and economic prosperity.”
In remarks on the second day of the summit, Department of Energy Secretary Jennifer Granholm assigned a number to that opportunity, estimating that the clean energy transition will generate $23 trillion by 2030. The “moonshot” potential related to hydrogen, carbon capture solutions, energy storage and addressing industrial emissions have the administration’s particular attention. “We need a mindset that overcomes resistance to change,” she said.
Environmental justice concerns were centered intentionally during the proceedings, with organizations including Grid Alternatives and Navajo Power in the spotlight. Some of the most powerful comments came from entrepreneur Nthabiseng Mosia, co-founder of West African energy company Easy Solar. “Progress does not have to be recklessly unjust,” she said, urging world leaders to challenge the status quo.
What will get us moving in the right direction when it comes to accelerating innovation? Amid the countless announcements timed to Earth Day last week were introductions, declarations or reboots of programs aimed at accelerating breakthrough technologies and climate solutions. Here’s the entire list of what the White House is proposing, and here are 10 developments from the past week — not just from the Biden bunch — worth particular attention:
The money people are synthesizing their net-zero financing plans. More than 40 banks representing trillions of dollars in declared financing for clean energy, sustainable development initiatives, climate solutions (and more) — including BNP Paribas, Bank of America, Citi, HSBC and Morgan Stanley — are part of the new Net-Zero Banking Alliance. That means they’ve committed to setting science-based targets for all those net-zero financing declarations that have been made over the past year and to disclosing progress regularly.
Climate is front-of-mind for U.S. finance agencies. The U.S. International Development Finance Corp. committed to making one-third of all new investments “have a climate nexus” by fiscal year 2023. And the Millennium Challenge Corp. will put at least 50 percent of its program funding toward climate-related investments over the next five years.
There’s a new economic measure that values nature. The U.N. has officially approved the concept of “Gross Ecosystem Product,” which quantifies how nature contributes to economic activity or human wellbeing. It’s a way of helping calculate the potential benefits associated with ecosystem restoration. GEP is part of the U.N. System of Environmental-Economic Accounting.
Introducing the Net-Zero Producers Forum. The new group includes countries that represent 40 percent of global oil and gas production, among them the U.S., Canada, Norway, Qatar and Saudi Arabia. The aim is to advance methane abatement solutions, circular carbon approaches and development of carbon capture and storage technologies.
Now we know more about Alphabet’s latest moonshot. The so-called Global Power System Transformation (G-PST) Consortium, which the U.S. just joined, is focused on improving grid reliability, resilience and security. Audrey Zibelman, who is leading a new X moonshot on grid reliability at Alphabet, had a hand in its creation.
Bill Gates talked up a reboot of Mission Innovation. The Obama-era program got a shout-out from the billionaire breakthrough proponent, and for good reason. It has been “reinvigorated” with a quadrupling of funding related to clean energy over the next four years including generation advances, as well as those centered on carbon dioxide removal and green hydrogen technologies.
$1 billion this year in forest restoration financing. Trees are a favorite climate solution, for very practical reasons. The U.S. is allying with the U.K. and Norway to create the LEAF Coalition, a.k.a. Lowering Emissions by Accelerating Forest finance. There are already close to a dozen corporate participants including Airbnb, Amazon, Bayer, Boston Consulting Group, GlaxoSmithKline, McKinsey & Co., Nestle, Salesforce and Unilever.
The U.S. is on board with shipping industry reductions (and aviation, too). The nation is officially joining work by the International Maritime Organization aimed at achieving net-zero emissions from international shipping by 2050. It’s also committing to advance next-generation sustainable aviation fuels and other climate tech. One beneficiary: Ascent — the Aviation Sustainability Center, which includes 16 well-respected research universities and 60 private-sector stakeholders such as Boeing, Airbus and major international airlines.
Agriculture isn’t being left out. The U.S. and the United Arab Emirates are co-leading the Agriculture Innovation Mission for Climate, which will focus on national-level research and development, and support for applied innovation in the private sector. More details will be forthcoming at the U.N. Food Summit in September.
Neither is nuclear. Building on a Trump-era program, the Biden State Department announced the Foundational Infrastructure for the Responsible Use of Small Modular Reactor Technology (FIRST), for supporting advanced nuclear reactor technologies. Given that nuclear generation is still the second-largest source of low-carbon power after hydro, it’s an area that will continue to receive attention.
The Biden White House isn’t just hedging its bets by going broad: The world needs wholesale innovation across every sector to get closer to keeping temperature increases to 1.5 C. This analysis by the New York Times shows we need clean energy and big cuts in industrial emissions and a big transition of transportation and lots of ecosystem restoration to pull this off.
“No single technology is the answer on its own, because every sector requires innovation to meet this moment,” Biden said toward the close of the summit. That definitely bodes well for climate-tech entrepreneurship.