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4th Quarterly Cleantech Editors & Reporters Roundtable

on • 13 min. read

4th Quarterly Cleantech Editors Roundtable

On April 21, we had the honor of welcoming the editors who have formed our Cleantech Editors Roundtable. This fourth convening continued producing useful insights from people who see trends emerge from the thousands of pitches our companies collectively send them each month.

We keep hearing from all of you in clean economy companies that you like the unique, 360-degree view of our sectors that the editors share. Please keep giving us your suggestions on how we can improve these discussions.

In the last convening, the edits covered some important questions. The first was the verdict from the Trump years. Specifically, does the clean economy commercial success during the anti-renewables Trump Administration suggest that policy is now less important than commercial execution?

The editors’ consensus? “Yes, but…”

  • Utility Dive’s Catherine Morehouse: “Considering the [2020] circumstances, clean energy did well. The market understood that what was happening under the Trump administration was not necessarily sustainable.”

  • Recharge’s Darius Snieckus cited the claim of the Director General of the EIA that renewables seemed to be “immune to COVID,” and that they’d generated “Trump-defying momentum that's being built up here, both in terms of construction and the finance.”

The qualifier? Editors see policy as still having an important role:

  • CleanTechnica’s Zach Shahan: “These markets are strong enough to keep growing and do well.... But the more you can have supportive policy, the better to accelerate positive change. Everyone wants to shape that as quickly as possible, especially the next two years, because we don't know what happens after that.”

  • GreenBiz’s Heather Clancy: Under Biden, “There is more clarity for the people to make decisions about where companies can invest; more of a direction, at least at the national level…. We finally have a chance to see some of these technologies get to the point where they could be cost effective across the ecosystem. But by pushing that deadline for the incentives out to 2025, it really gives this marketplace a chance to try things.”

  • Utility Dive’s Morehouse: “You look at these utility goals, and they're making those goals in anticipation of policies that are going to be more aggressive. I think that was in part in anticipation of a policy structure that will be more aggressive. So, I think it'll be really interesting now that we have an administration and a Congress that has pledged to be more aggressive on these policies.”

  • Recharge’s Snieckus: “One of the greatest challenges facing Biden is to reconnect industrial manufacturing policy with energy policy. In the 20th century, oil and the automobile were the wealth generator. In the U.S., electrification of the grid will be the generator of wealth in the 21st century.” 

The editors also noted the rising importance of SPACs, or Special Purpose Acquisition Companies, at a time when there is a lot of global capital chasing clean economy deals.

  • GreenBiz’s Clancy: “We’re covering them. [I am] very surprised by the growth of SPACs that really were a factor in terms of the clean economy, especially in transportation startups during 2020. I do think it will continue to be a trend this year, though, for sure.”

  • CleanTechnica’s Shahan: “I have mixed feelings in the EV space, because on the one hand, SPACs are giving a lot of funding to good companies that could do great things. On the other hand, there are some companies that probably don't deserve what they've gotten, and are going to crash, and it gets all the headlines while 10 other great companies do great but don't get headlines.”

What are the trends that the editors were tracking at the start of 2021?  

  • Will the U.S. and the E.U. take steps to loosen China’s control of rare earth minerals so critical to batteries used in EVs? CleanTechnica’s Shahan: “About 80 to 90% of lithium and cobalt processing and production happens in China. There's a concern that China gets a kind of OPEC-like monopoly and screws up a lot of the plans for making a more democratized, more egalitarian economy. What you need are big mining and processing facilities in North America, Europe, that are not typically huge supporters of mining and processing facilities. So, you have this balance of, if you want a full clean transport economy, you have to have these things." 
  • What will happen to carbon capture? GreenBiz’s Clancy: “I am watching carbon capture and storage and what's going to happen with that market this year, companies that are taking that captured carbon dioxide, and not just sticking it somewhere, but are using it as a feedstock for something else."
  • The oil industry’s trajectory and its investment in cleaner technologies. Recharge’s Snieckus: “Obviously 2020 was a watershed year in terms of announced strategies for net zero. But fundamentally, we also know at the same time that the percentage of their CapEx that's actually going into renewables is minuscule. You want to unpack it on a number of levels. One obviously, has emissions targets. And there’s power storage, because this is the connective tissue that makes a variable power source, wind, solar or other more baseload valuable. All this feels like kind of confluence around accelerating the transition this year.”
  • Whither FERC? Utility Dive’s Morehouse: “FERC is my number one [trend focus]. It's been referred to as the linchpin of clean energy policy deployment. What that will really do is set the tone for RTOs, and it'll be interesting to see how those wholesale markets respond. There's also an appetite to undo some of the more controversial FERC policies of last year that a lot of clean energy folks didn't like. And then there's also their DER order that we'll start to see wholesale markets implement halfway through the year.” 

For our 4th episode, we had a mixture of the familiar and new to this forum.

The new:

The returning regulars:

 You can view the full recording of the roundtable here with the password R#6dnb0K, and read the transcript here. These conversations fly fast over lots of topical territory, so it’s often tough to boil them down to a few core points. However, our conversation centered on these four questions:

  1. What are the emerging trends you’re watching?
  2. How important are corporate sustainability pledges and direct corporate purchases of clean energy? Are they still as big of a driver in the sustainability transition as they were a few years ago?
  3. How’s Biden doing in his first 100 days?
  4. What’s surprising you?

 

Q: WHAT ARE THE EMERGING TRENDS YOU’RE WATCHING?

REW/Runyon – “Things are looking great for clean energy. I'm almost getting tired of the massive solar projects that are being announced all this time. I've also been pleasantly surprised to see some micro grids going in, in California, for resiliency and for fighting wildfires.”

GB/Clancy – “One is, I'm super excited about the potential for a green bank. At a national level, I think that will unlock a lot of finance for projects where we haven't typically seen them before. Smaller projects for community solar, potentially for communities that have not had access to the clean economy or clean energy developments. I'm also really excited about some of the carbon tech-related announcement, including for sequestering carbon in concrete. But also, tons of potential technologies for industrial de-carbonization. Things that make industrial processes much more energy efficient and much less carbon intensive.”

CM/Wesoff – “The trends that I’m seeing are financial. Though we’ve seen it every day for the last 10 years, there’s even more money coming into [clean economy sectors]. Whether it be in green banks, in carbon banks, in new venture capital funds. We’re seeing that type of financial innovation. You could also talk about SPACs as a financial innovation in clean tech. And we’re hearing more about Blackstone. I think it’s more about money flows as far as trends are concerned.”

 RC/Snieckus – “Offshore wind is the only sector name-checked in president Biden's executive actions. You see the secretaries of energy and commerce, lining up to make the target announcement. That makes pretty clear the big Venn diagram in Biden's mind that says, industrial transformation, economic development, and clean power. There's a big sweet spot. From our standpoint at Recharge, that's huge, exciting, just to see birth of an industry really, that's been billions of dollars, harbor side right now, waiting to be turned into steel in the water. There's just this kind of really quite electric atmosphere. Just a hugely exciting time and great to be an energy journalist of this point in history, I think.”

CT/Barnard – “What I am seeing in carbon capture policy is environmental focus: Trees, wetlands and low-tillage agriculture are much more supported by policy globally. Second, I'm strongly seeing a rear-guard action by the legacy power organizations to make it seem as if carbon capture and sequestration, industrial-mechanical approaches, are fit for purpose. They're going to be necessary for a small percentage of the industrial processes, that we can't decarbonize. But job one is to stop emitting the CO2 at all. Third, [China] turned their economy into a high-carbon economy faster than any other economy in the world, and they're now turning the curve on that faster than any other economy in the world. The expectation is they're going to be hitting their admittedly weak Paris Agreement targets nine years ahead of schedule.”

UD/Gheorghiu – “We're seeing a lot of utilities and corporations make big announcements on their renewable goals, on their renewable buying targets and new projects they're doing, which is really great to see. But, the thing that strikes me now, as we have a lot of activity from the administration as well, we're seeing that shareholders and investors, green funds and consumers, are asking for more. Shareholders, consumers and green funds, they're asking for more than 100% renewable energy or than a big, mega, block target.”

Q: HOW IMPORTANT ARE CORPORATE SUSTAINABILITY PLEDGES AND DIRECT CORPORATE PURCHASES OF CLEAN ENERGY? ARE THEY STILL AS BIG OF A DRIVER IN THE SUSTAINABILITY TRANSITION AS THEY WERE A FEW YEARS AGO?

GB/Clancy – “Are they serious? They're serious. Are they detailed enough to be meaningful? My main answer is, “no.” We don't have a good enough short-term view on what people are going to start doing now. I think they're serious because when you have the CEO or the chairman or that level of person making the commitment. They're serious, and they need to be serious. But I don't necessarily think that we have enough detail for us to know if they're going to be meaningful.”

REW/Runyon – “I think the volume of announcements that I'm seeing is greatly increased. It seems like everybody is saying, "We're going to be carbon neutral. We're going to be carbon neutral." I think it's great. But the truth of the matter is that if you take it a step further, we don't really have a clear path to be 100% carbon free. We don't. We're relying on some that we are pretty sure are going to be there and be ready in 5, 10, 15 years, but don't really have those.” 

RC/Snieckus – “I think an interesting backcloth to this could be the World Economic Forum Index that was published yesterday. It’s an annual index, and the boil down was: The last 10 years have considerably accelerated the energy transition. But by their measure, they cross calculate what economic development and environmental sustainability, and energy security is their kind of trifecta. We're only seeing, I think it was 10% of countries on the planet, have actually seen steady and measurable improvement, in terms of their energy transition. All to say, we all know faster, further.”

Q: HOW’S BIDEN DOING IN HIS FIRST 100 DAYS?

REW/Runyon – “I think definitely impactful. On Twitter, people were saying that the rhetoric from the oil and gas industry has changed. And certainly, that may not be true internally, but there is more discussion of wanting to have a clean energy future now.”

CT/Barnard – “It's wonderful from the rest of the world's perspective. The United States is back in the Paris Accord, and is having conversations with China. The infrastructure plan has been described as probably the only climate bill that'll get through Congress in the next two years before the midterms.”

UD/Gheorghiu – “It is super refreshing, to see the DOE loan program get restarted, to see all the announcements. I was going to say that a lot of us reporters have been waiting with bated breath what comes next from the Biden announcement that has been expected on Thursday from the Climate Summit. Now, there's the announcement that the administration will try to cut greenhouse gas emissions in half by 2030. Is that good? Yes. Is that surprising to us that have been covering this a lot? No.”

GB/Clancy – “I think the most impactful thing for my audience that's been happening has to do with the Securities and Exchange Commission, and the move towards regulations that will require these companies to say exactly what they're doing, where they stand and the accountability. That, I think, could be a hugely impactful development, especially when you go back to the point I was making before about so many commitments, and are they meaningful. We don't know. Now, hopefully, there will be a framework in place for those metrics to be more comparable and to be things that people have to submit and declare and disclose, and then work towards. You hear CEOs on the quarterly calls. When this theme gets be part of those calls, then we're going to see real meaningful stuff happening.”

CT/Barnard – “The tax breaks for fossil fuels are almost entirely embedded in the permanent tax code. They're incredibly hard to get rid of. If we look at the scorecard that NRDC maintains for the G20, what we see is the United States has made zero movement on its commitment to eliminating fossil fuel taxes, because it's an incredibly hard nut to break, to gain the politically necessary votes to open up the permanent tax code. The last time we had a major expansion of the PTC in 2015, the Republicans got the right to ship crude oil, export crude oil, something had been taken away, I think in 1974 by Ford. As we look at that history, what is it that the Democratic Congress has to trade that's equivalent to unlocking crude oil exports? Even for an extension of the PTC and with Manchin and the role that he's playing now.”

Q: WHAT’S SURPRISING YOU?

RC/Snieckus – “Fundamentally, the term is resilience. It's certainly been one of the greatest encouragement to me, to see how offshore wind, for instance, has come through. When you see the onward marching progress – if not as fast as it needs to be – that's certainly an encouragement.”

GB/Clancy – “There's two things. One, the assumption was that we were going to see a slowdown in the corporate power purchase agreements for renewables. But those kept happening. We had a bang-up [2020] fourth quarter, and the first quarter [of 2021] was really strong. I'm talking specifically about the corporate offtake agreements. Second is the extent to which companies are completely rethinking their travel footprints and their office footprints as they come out of [the pandemic]. There's still a lot of uncertainty there. But I personally didn't expect it to become the sort of profound moment of rethinking how work gets to be redone. How do companies – if they choose to keep a certain percentage of their workforce remote – account for those carbon emissions? How do they help their employees get solar power and so forth? That's a big thing and it's still completely work in progress. But that I think will be amazingly impactful for the corporate [world] moving forward.”

REW/Runyon – “A couple things. I was very pleasantly surprised to see that [rooftop] solar just coasted all the way through 2020 and continues to grow. I'm really very glad to see a lot of environmental and social justice kind of stipulations in some of the plans that I'm seeing. Some of the utilities are directing more funding, there's more job opportunities for training.”

UD/Gheorghiu – “A little bit of a downer, but the fact is that we don't really have a framework for dealing with the [utility] shut-off moratorium. This is a big us problem right now. You have utilities of many sizes, municipalities co-ops investor owned utilities too, and regulators. And everyone involved is saying, "This is really important. We cannot keep doing this." But also, how can you ask people that are impacted by the pandemic in so many ways to pay up the bills that they've been neglecting for a year.