TL’DR
1) How Russia’s war against Ukraine will change the landscape of global energy in a profound way
2) As demand for mezcal rises, over harvesting of agave plants has imperiled bat populations
3) IPCC’s new report shows glaring hole in investments we need in climate adaptation and resilience
It should be said right from the top that not only do we stand for Ukraine and it’s incredible people who are risking their lives to defend their country as well as the groups of Russian citizens brave enough to stand against their terroristic dictator, but the single most important outcome globally if Russia is defeated would be a stand for democracy. A stand against totalitarian regimes across the world who not only oppress and kill their own citizens in the pursuit of power but who also block our progress on addressing our climate crisis which required unprecedented levels of global cooperation to pull off.
With that said, and believe me we do not want to appear to be trivializing any of the horror happening to so many good people in Ukraine by discussing broader implications of this war, it is important that we look at how what is happening could shift our much needed global energy transition to renewables – possibly very good or very bad. There is nothing more important in our fight to save this planet than getting off fossil fuels and protecting biodiversity.
Russia plays an enormous role in the global energy picture. For one, they are the largest producer of oil and natural gas in the world. Which makes sense when you consider the size of the country and where it sits in the northern hemisphere as the largest land mass in the Arctic Circle, a hot spot for underground methane stocks (natural gas). Europe is particularly reliant on Russian fossil fuels. 40% of their natural gas comes from Russia and 25% of their oil. So too is China, who while this war rages on is increasing its imports from Russia, just last week announcing a new pipeline with Russian giant Gazprom for 50 billion more cubic meters of gas per year. A hedge for Putin and Russia if you will on the 150 billion cubic meters per year sold to Europe if energy sanctions come into play.
Up until Monday this week, the US and Europe were not sanctioning Russia’s primary revenue source – their actual oil and gas. Sure they passed sanctions on access to banking systems and seized a couple yachts, but that’s not even a slap on the wrist. Finally Monday, the US declared a ban on Russian oil. Why did it take so long? Well, you’re seeing the impacts this week with the sharp rise in gasoline prices for example. Biden is taking on some political risk here because he now has to scramble to get oil from other less desirable places – such as Saudi Arabia and Venezuela – in order to get prices down in time for the midterm elections. Or he can convince our local suppliers to produce more, but Biden and local oil & gas are in a bit of a game of chicken over the long-term position of fossil fuels. Meanwhile, don’t expect Europe to do the same, they are just far too reliant on Russian fossil fuels and an embargo on their end would not just raise gas and energy costs, it would quite literally shut down the economy.
This is leaving us with a big mess to sort through on how this war will impact our renewable transition overall.
THE GOOD, THE BAD, & THE BULLSHIT
Ok so let’s start with the argument for how this can help fast track our transition to renewable energy.
The war is really exposing the high costs and high risk of continuing to rely on fossil fuels. The largest providers of oil and natural gas are the Middle East & Russia, two regions with decades of geopolitical challenges and a resistance to the democratic and social values most Western countries strive for. While yes, it is possible in theory for the United States to be energy independent solely on fossil fuels, doing so would require us to maximize our environmental damages and social damages due to the public health costs of pollution, while leaving much of the rest of the world unstable due to reliances on Russia & The Middle East. Instability that impacts the US as well.
Skyrocketing energy prices during periods of global instability is nothing new, but countries have still not learned that “part of what we’re seeing here is the cost of reliance on fossil fuels,” said Sam Ori, executive director of the Energy Policy Institute at the University of Chicago.
Shifting to renewables would create much more parity around the world when it comes to energy production, since resources like wind and solar are of course more widespread. But it won’t come overnight and it won’t come without a tremendous investment in the infrastructure needed to scale it, store it, and move it around. Well here’s one way to invest in that infrastructure – a simple levy of $10 a barrel on Russian oil would equate to collateral for a 20-year, $400 billion dollar investment in renewable infrastructure. Which both fairly squeezes Russia right now without completely cutting off the oil many European countries do need for the time being while expanding our investment in renewables.
On the other hand, there is a chance this war pushes energy in the other direction, with more investment back into fossil fuels. There is a narrative being spread around by those who back fossil fuels that if we ramp up production and expand drilling in the US & Europe, we can fast track shifting our reliance on Russia for the same resources. While renewables still are years away from getting to scale and most importantly solving intermittency issues with storage, fossil fuel expansion is available right now and can be done in short order. Even nuclear, which is something we here at Animalia are firmly supportive of expanding, can take years to stand up new facilities. This is a powerful message that can sway a lot of voters into electing representatives who want to push this forward.
However this is not exactly true. For one, many oil companies are already sitting on extra capacity without the need to expand new drilling sites or relax new laws restricting long term fossil fuel expansion, but are choosing not to make that extra production available for two reasons:
- They are holding it as a negotiation lever in wanting to open up new drilling sites such as those on federally protected lands and subsidies for new infrastructure to ensure fossil fuels are here for the long-term, or at least, they determine when and how we phase them out (don’t count on that).
- They are still recovering a bit from the shock to their system in 2020, when global lockdowns crushed the demand of supply, particularly in oil with less people moving around, and have been purposely gradually increasing supply to hedge against the chance of another lockdown while COVID still lingers around
The ask or media claim to give the fossil fuel industry what they want to open up long term investment in order to get their short term supply is a very risky proposition, and would all but guarantee we come nowhere near our goals of keeping global warming below 2.0C, let alone 1.5C.
There are alternative ways to add in some non-Russian oil and gas right now without giving those companies rights to expand long term investments and infrastructure if they are unwilling to budge.
- Reentering the nuclear deal with Iran would be one that opens up their existing oil for sale.
- Buying more from the horrific Maduro regime in Venezuela
- Giving into some of the demands of Saudi Arabia and UAE around nuclear technology and supporting their inhumane war in Yemen
What do all of these have in common? Just like Russia, we have to constantly deal with the very worst people and regimes and violations of human rights across the planet to keep our dependency on oil. All the more reason to get off this energy source mid to long term, even the climate crisis aside.
Many Republicans are out there right now shouting that Biden’s climate agenda is hampering our ability to sanction Russia’s oil and gas because he’s restricting our ability to fill that supply instead. Costing Americans jobs and revenue while only benefiting Russia’s grasp on European energy. This is a great talking point for politicians but is complete hogwash.
- For one, in order to move natural gas overseas from the US to Europe it has to be converted to liquified natural gas (LNG) which is expensive and requires a big investment in infrastructure not only here but in Europe as well, where all of their existing LNG receiving ports are at capacity. Nor does Europe want to start to rely on a much more expensive source of gas.
- For another, we are not producing less natural gas under Biden. We actually produced more in 2021 than any other year ever. Biden has tried to limit new drilling sites on protected lands but has not at all stopped capacity from existing ones. We are simply exporting a lot more, more in 2021 than any other year ever, but anti-climate agenda folks will lie and say this administration is limiting our natural gas production.
- The long term investments being made in renewables right now have NOTHING to do with our ability to offset Russian oil and gas dependency. Again we have more capacity here to expand without needing to approve new sites, but US fossil fuel companies are refusing to do so as a negotiation tactic for keeping fossil fuel expansion and subsidies in the long term. We can open up Iran if we renew that nuclear deal, and we can lean on Saudi Arabia and OPEC to expand their production on the oil front, which they’ve been resisting to keep prices high. All of this can be done without needing to add new drilling sites or new long term infrastructure to fossil fuels.
OUR TAKE
How things play out on the energy front when it comes to Russia is no doubt the most significant global impact of this war after protecting democracy itself. Germany, a country that gets 50% of their natural gas from Russia, is no doubt kicking itself a bit over taking such a hard stance against nuclear a decade ago as had they invested like France, many of those plants would now be coming online and able to offset this Russian reliance.
To the German’s credit, they did pause the build out of Nord Stream 2, a massive gas pipeline with Russia twice the size of the currently largest one that runs through Ukraine. This does squeeze Putin a bit, but it also makes it all that more important for him to take control of Ukraine for as not to lose control of that pipeline with Nord Stream 2 on pause. Still, unless sanctions are put on the actual current oil & gas sales of Russia directly, the sanctions will continue to be of minimal deterrence to Putin.
The US had to ban Russian oil. Had to do it. Sadly, it’s hurting working and middle class Americans with a spike in prices. Subsidizing this to offset those costs risks furthering inflation. This is a tough situation. Biden is counting now on his ability to cut enough deals for more oil in the short term to bring prices back down ahead of the midterm elections this fall. Otherwise, expect a landslide Republican victory and even more resistance to transitioning to renewable energy.
That said, in a way Biden and his regime only have themselves to blame. Their inability to tackle inflation up to this point, overspending in programs as a way to appease party politics, and failures to get things consistently right around COVID have left them with little to no political or economic cushion for tackling a crisis like what’s happening in Ukraine and withstand the effects of it. Still, we applaud him for absorbing that political risk and doing the right thing for blocking Russian oil.
There is no more important need than standing by and helping the Ukrainian people and their fight to protect democracy everywhere. A close second behind that is that this war signals the downsides of our reliance on fossil fuels and advances the transition into renewables even faster. There is a lot of political noise and disinformation standing in the way of that. So let’s keep spreading the truth as best we can.
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WHY ALL TEQUILA & MEZCAL LOVERS NEED TO BECOME BAT ADVOCATES
Bats get a bad rap. And let’s be honest, this was the case even before they became a possible link in passing COVID onto human beings. Rats get a bad rap too, and bats to most people are essentially flying rats. Batman seems to do just fine, but the flying Chiroptera that inspired his namesake have not been as fortunate.
What many people don’t realize is that bats are incredible pollinators. We rightfully carry bees, butterflies and hummingbirds in high regard as they are essential to our food supply. Bats do the same valuable work without much of the fanfare.
In Mexico, there are many plants that completely rely on bats for pollination. One of them being agave. That wonderful, sugar filled plant that is responsible for all of our tequila and mezcal.
However, as these drinks have exploded in popularity over the last 20 years across the world, but particularly in the US, the bats and the ecosystems they keep stitched together are falling apart. In response, there are many efforts right now to completely change how agave is farmed and harvested in order to certify them as bat friendly. It’s about time we make consumers here in the US more aware so they also seek out these bat-friendly certifications when making purchasing decisions.
HOW MEZCAL DEMAND IS KILLING BATS AND COLLAPSING ECOSYSTEMS
Let’s first outline the intimate relationship between these things. It’s actually quite romantic in a way. Agave plants typically only flower ONCE in their entire lifetime, ranging from 7 to 30 years depending on the agave species. This is because it takes years to build up the internal sugar supply at the heart of the plant needed to blossom. That’s the same sugar that is extracted and fermented for tequila or mezcal.
Greater and lesser long-nosed bats then provide an essential cross-pollination service once they flower, which in turn produces seeds. Which in turns produces more agave. Bats rely on agave pollination to survive, because of how nutrient rich it is. Furthermore, these bats of course pollinate many other critical plants once strong enough following their agave feeding, such as the columnar cacti, which in turn provides food for as many as 100 animal species.
Thus, if something gets in the way of bats’ access to agave, this has a domino effect that in turn collapses the entire natural ecosystem over time.
Well, what’s getting in that way is the boom in demand.
Take mezcal. Here is the growth of mezcal exports over the last decade:
2013 =900k liters
2017 = 2.7M liters
2019 = 5.8M liters
That’s 540% growth. In order to keep up with that growth, growers in Mexico have had to adopt some pretty unsustainable practices, namely:
- Growing agave with clones instead of seeds. By this I mean planting a piece of an existing agave plant rather than a seed it produces via cross-pollination. This reduces their genetic diversity and makes them more susceptible to disease
- Harvesting agave right before they blossom, as this is when their sugar stock internally is at its peak level, since it is about to be used to blossom that flower.
- Needing to bring in pesticides and herbicides never before needed in order to scale scale scale. Which in a twisted form of irony is also an increasing need as we lose bats, since bats are an incredible natural form of pesticide since they hunt and eat so many pests!
This in turn is killing bats. Their access to flowering agaves is shrinking, and the pesticides needed to scale harvests is wiping them out as well along with plenty of other important species in these ecosystems.
So what’s the solution?
OUR TAKE
The good news is, this is not a problem without a solution. There are ways to keep a steady flow of agave coming while protecting bats. People such as Alfonso Valiante & Rodrigo Medellin are forging pathways for these solutions.
They are part of a coalition of folks in Mexico creating the country’s first ever bat-friendly certification program that requires 3 things:
- Growing agave from seeds, not clones
- Cutting back use of pesticides via regenerative practices such as use of cover crops
- Maintain a certain % of agave (typically 10-30%) for flowering while the rest can be harvested just before the blossom
Now that these standards are in place, we need the Mexican government to figure out how to reward and enforce them, and we need to increase awareness around the world, starting in the US, so we prioritize purchasing bat-friendly brands. So if you are a lover of tequila or mezcal or a bartender or restaurant owner that serves it, here is a link to learn more.
This yet another reminder of just how critical all species are. How intimately linked life is and how equally fragile and vulnerable it is to over exploitation. So let’s start showing bats our love, because they are quite literally the source of some of our favorite cocktails!
Well good news, fast forward to 2020 and that 19% has become 80%!. That’s right, thanks to the advancement in climate awareness and due to some fantastic work from organizations such as Climate Central, today over 80% and counting of meteorologists agree that human activity is driving climate change.
Climate Central has a division, aptly named Climate Matters, that distributes regular reports, graphics, videos and more from their climate science team to over 500 local news stations reaching over 90% of American media markets.
But do they see it as a problem? Well that seems still split 50/50. Of those that don’t see it as a major negative, it’s roughly split between half who are just not sure and half (25%) don’t see it as a crisis. So only slightly better than the overall US average.
This presents both a problem and an opportunity. The problem being that we need to get all meteorologists on board. The opportunity being as we do, we’ll be able to reach a lot more older Americans with a lot of voting power in maybe the only way possible.
You might think, why would a meteorologist, a weather scientist, not totally buy into the climate crisis? Well for one, there has always been some controversy over the role of climate change in specific storms. Meteorologists very fairly get frustrated when a social media post or CNN (yes they do this) goes out and blames the entirety of a hurricane on climate change. That’s not true. Hurricanes have been around for, well, forever. What is true is that they are growing wetter and more intense on average, due to warming temperatures allowing clouds to hold more water and warmer sea levels allowing them to pick up more steam as they race towards a coastline. But now, the baseline existence of the storm itself is not only due to climate change.
When it comes to things like heat waves, droughts, and wildfires, there is a bit more alignment across all of the meteorology community that global warming plays a role.
Another factor is personal political beliefs. Scientists are humans. Humans have beliefs. Humans have emotions. Emotions can trump reason. This happens to all of us. Those emotions can be magnified based on feedback. For example if you are a meteorologist in an area in the country where there is less public support for recognizing the climate crisis, you are likely to solicit negative responses.
Which is what makes this next video so dog garn inspiring. This meteorologist, Amber Sullins, has been sousing the horn for years on climate despite some of the hate mail she receives for it.
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FALLING BEHIND ON ADAPTATION
Last week, the IPCC published the 2nd of 3 parts of their latest climate report, the 1st of which was published last August. While the report last fall provided a detailed look at where we sit when it comes to global warming and biodiversity collapse, the drivers, and the forecasts ahead, this report dug into the impacts on human communities & ecosystems.
One glaring hole revealed is that while we are putting a lot of effort and capital towards climate mitigation – mainly in the form of lowering emissions and investing in ways to capture and remove carbon – we are well behind investment we need in climate adaptation and resilience.
In terms of some definitions, adaptation is the process of adjusting our human systems and ways of life to the impacts and expected impacts of climate change. Investing in resilience is expanding our capacity to absorb and get through the impacts of climate change.
Of all the capital going into mitigation and adaptation globally, last year just 7% went towards adaptation and resilience, with the rest going towards mitigation. The United Nations Environment Program estimates that by 2030 we’ll need to spend $150-$300 billion per year on adaptation & resilience, and by 2050 this figure will be at $300-$500b. Yet the current global plan from COP26 last fall sees the top 50 developed nations spending just $50B in adaptation per year with no set plan currently for increasing it.
As many as 3.6 billion people live in areas currently highly vulnerable to climate change – half the planet! Yet even our most climate committed leaders and companies are not focusing nearly enough on helping these folks adapt for what lies ahead. And make no mistake, much of the changes coming are irreversible. So the need to adapt and become more resilient is unavoidable.
So why is that? And what are some examples of what adaptation investment looks like? And how can we solve this gap?
ADAPTATION EXAMPLES
Here are several examples of adaptation areas:
- Farmers shifting focus to more drought and heat resistant crops
- Increasing energy efficiency
- Improving flood protection via increased drainage infrastructure and insurance programs
- Prioritizing more localized consumption to lower the transportation needs of goods
- Preparing for increased rates of power outages with more shared touchpoint across our electrical grid with backup options to power our most critical infrastructure
- Investing in public health programs to prepare for increased disease spread from water and food borne illnesses
- Creating non-energy intensive ways to cool cities and buildings such as more green spaces and tree cover
- Social welfare programs and safety nets
There are also things that touch both adaptation and mitigation
- Regenerative farming
- Solar rooftops for working and middle class homes
- Shifting from cars to public transit and slowing down road expansion in developed areas
These all sound like good things right? And yes they are happening here and there, but not nearly at the rate of investment in mitigation. Again to the tune of just 7% of global investment compared to 93% for mitigation efforts. What’s driving this?
REASONS WE ARE BEHIND IN ADAPTATION
1. Lack of clear path to ROI
Perhaps the main reason, certainly the biggest reason for low adaptation & resilience investment from the private sector, which globally put just $500M into this area in 2021, is the lack of clear path to ROI compared to mitigation efforts. Take renewable energy. Investment in solar, wind, geothermal, and nuclear are booming. And this is great, we need them. However they also promise big time returns for investors, with a clear path in how to get there. Not so much for adaptation and resilience investment. This despite models in a World Bank Report that show for every $1 we spend on adaptation it creates $4 in net benefits. These net benefits however are built over time from many indirect ways. For example, adaptation efforts to invest in protecting river banks from sediment runoff due to degradation protects water quality over time which lowers health care costs and improves productivity over time. But the short term ROI is not as easy to capture.
2. Adaptation most needed in areas with less global economic power
The regions that need adaptation investment the most are South America, Southeast Asia, The Caribbean, and Sub-Saharan Africa. Yet most of the world’s economic power is in the US, Western Europe, and China. That’s a problem. Those countries are less inclined to invest because they want to take care of home first and foremost. Our economic powers, including the US, have no problem investing in extracting resources from these parts of the world, be it palm oil or cobalt, but they are hesitant to invest in protecting the livelihood of people in these parts of the world that desperately need it.
This is not only a problem globally, but regionally as well. For example, take the US. Heck take California. California is in a historic 10 year drought. Many smaller towns in central California are without reliable access to water because the state has failed to help these areas adapt. Meanwhile, massive investment has been put into drought adaptation for California’s massive agricultural industry and city centers such as Los Angeles, which is also due to there being a more direct path to ROI.
3. Lack of clear measurement
Mitigation is much easier to measure success against. Are we reducing the amount of emissions and net greenhouse gases or not? This is something we can measure fairly easily and all agree on globally. Adaptation and resilience investments are much harder to measure. This is because they have so many different inputs and variables, and typically have a much longer timeline to measure against. When we can’t easily measure things, we are less inclined to invest in them.
4. Lack of Climate Risk & Vulnerability Data
The IPCC report is a helpful look at where we are as a planet, and it includes some regional breakdown as well. However, individual countries, regions and towns do not invest in similar risk modeling and vulnerability data themselves. For example, we published a story earlier this year on how many cities across the United States are still working on flood forecasts based on models from the 60s and 70s because they’ve chosen simply not to spend the money to update them. Without rigorous investment from the government in modeling down to the local level, we are essentially flying a bit blind, and it’s hard to justify a long term investment in adaptation without a clear path to immediate ROI if you don’t have a model to support it.
The result? We are far behind where we should be in preparing our cities and communities and ecosystems for the climate changes to come. Increased droughts, wetter hurricanes, collapse of water systems, increased power outages, and so forth.
Not only that, but in some cases we are investing in the wrong areas of adaptation. For example:
a) Private companies are planting forests where forests have never been before, such as grassland ecosystems, in order to capitalize on the carbon offset market that wants to pay for those trees (ugh, how many ways can we hate carbon offsets?). This in turn actually leads more food insecurity, biodiversity loss, and displacement of local and/or pastoral communities. All in the name of wealthy person on Wall Street selling some offsets to company that then uses this to get out of lowering their own emissions.
b) 29% of our emissions in the US come from transportation. We love our cars. In order to drive them, we need roads, lots more of them. However studies have shown that increasing roadways doesn’t lower congestion long term, as we just fill that new space with more cars. Electric vehicle companies love this as they want to sell more cars and have a great climate story to tell when doing so. But these roads need a lot of carbon intensive asphalt and construction, lead to more cars of which even EVs have emissions of course in the electricity to power them, and tear up more natural land, such as building over wetlands that we need to absorb future flood waters. Instead we should be minimizing investment in more roads and cars, and maximizing and improving public transportation such as rail and buses.
OUR TAKE
It’s good to see all of the increased attention and investment the climate crisis and mitigation efforts are getting. It feels like we are on a legit path to getting off fossil fuels. Kinda. But we are not going to be able to mitigate our way out of really big changes already coming our way at this point no matter what we do going forward. We are going to get to that 1.5C warming mark or at least very close. No, scratch that. We are going to hit it. The numbers don’t lie. We can stay below 2.0C, as crossing that would get to a place where we start to lose some 20-30% of our coastal cities, but even then, changes are coming.
We have to invest in helping people adapt and be ready. As always, the problems for why we have not done this to date also point to the solutions.
- Develop viable, financially sustainable commercial models for investing in adaptation and the money will flow in. Governments should provide tax credits to the private sector willing to take on the risk here of less certain short-term ROI to further move the needle.
- We need to give ALL nations and communities and peoples representation at our global climate summits and pledges. The economic powers of the US, Western Europe and China should not be dictating the terms for everyone else just because of our outsized role in this fight to save the planet. We need to level the playing field when it comes to global cooperation. Yes we have the most economic power, but we’ve also caused the most damage since the Industrial Revolution as well. That to me sounds like they cross each other out, putting us at a net score of Zero. A small country like the Maldives that faces possible extinction likely scores positive on the climate front. Yet we call the shots and they follow along?
- Adaptation needs a better vehicle for measuring success along the way.
- National, regional, and local sectors need to invest in regular reporting and modeling via public-private partnerships with the same rigor the IPCC does in their global work.
This is all doable. Of course, it’s always doable. That’s the irony of this crisis we are in. There is no mystery of what needs to be done. We just have to do it.
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