Re-Opening Creates CO2 Emissions, Renewable Capacity Takes Off, but Coal is Still Kicking
the Plug #2
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This week’s edition has three sections: 3 charts, 2 quotes, and 1 meme.
Each section also stands alone, so you don’t have to read it all.
Read time: ~8-10 minutes
Three Charts
1) As “normalcy” returns, so do CO2 emissions
Last year, COVID-19 brought our lives and our economies to a standstill. And so, in 2020, there were ~6% fewer CO2 emissions generated globally than in 2019. Finally, some good news!
Not so fast. Last May, Nat Geo reported that atmospheric CO2 concentration hit a record level, despite the decline in last year’s annual emissions. Wait, what?
The complexities of CO2 concentration merit a longer discussion than this newsletter. In essence, though, this outcome was the ghost of emissions past.
Humour me for a second – let’s say that each day, you routinely pour a cup of water into a bucket.
That bucket will slowly fill with water. Tomorrow, should you decide to pour in less water than today, the result is still more water in the bucket. The only difference is that the water’s rate of increase has slowed.
Now instead of a bucket, think earth’s atmosphere, and instead of cups of water, think annual CO2 emissions. The fullness of that “bucket” represents atmospheric CO2 concentration. This oversimplified explanation should suffice for now.
Sadly, last year’s emission reductions were as temporary as the lockdowns from which they resulted. Look at China’s quarterly CO2 emissions below. They tell that story well.
This week, a branch of the U.S. government reported that atmospheric CO2 concentration once again peaked, reaching what is believed to be the highest level in over 4 million years.
Meanwhile, I’m thrilled that pre-pandemic normalcy approaches. But that normalcy? It goes hand-in-hand with steadily rising CO2 emissions.
From our cars to our flights to our nights out, it all adds up.
China’s dramatic rise in carbon emissions also highlights the importance of international cooperation in mitigating climate change. No one country alone will succeed in reducing atmospheric CO2 concentration.
2) Global renewable energy capacity keeps climbing.
Despite the doom and gloom above, there remains a glimmer of hope for humanity. That hope is coming in the shape of wind turbines and solar panels.
The production capacity of renewable energy infrastructure globally increased by 45% in 2020 - the most significant year-over-year increase since 1999.
In response, the International Energy Agency (IEA) raised its projections for global renewable capacity additions for 2021 and 2022.
As you can see, renewable energy demand is rising significantly. We highlighted last week that China currently dominates the global supply chains for clean energy technologies.
The combination of Chinese dominance in these industries, coupled with growing international demand, will favour China. I suspect that over time, this dynamic will increase China’s bargaining power internationally.
3. Coal still plays a prominent role in global electricity generation
Back to the doom and gloom, unfortunately.
Eliminating coal from our energy supply is widely acknowledged as one of the best ways to reduce global emissions. And yet, China and India’s “energy mix” is noticeably different from more developed economies.
That difference is big and black: dependence on coal.
The “energy mixes” above highlight the proportion of each country’s electricity supply generated from different sources. In China and India, coal-fired power plants generate over 60% of the country’s electricity.
In the U.S., this number is now ~22%, down from ~50% in 2000. Even less reliant on coal are both Russia and the EU.
Because of political bureaucracy, resource availability, and economic trajectory, China and India have struggled to follow suit. We will explore this more in future.
Two Quotes
1) Dramatizing climate change comes in both blue and red
I frequently criticize U.S. Republicans for climate change denialism. Similarly, it’s relevant to call out Democrats when they are alarmist and dramatic in their rhetoric.
To shy away from doing so would be hypocritical.
Alexandria Ocasio-Cortez consistently raises thoughtful, intelligent arguments on inequality, sustainability, and other social issues. But to say that “people care more about helping oil companies than their own families,” as AOC did at 1:05 in this video, is a bit dramatic and also categorically false.
The image she paints has Republicans sacrificing their babies to the BP’s and Exxon’s of the world. It’s just unrealistic.
To her credit, the passion and emotion she brings to the capital have helped catalyze progress in U.S. politics. My point is that, in some instances, her flair for the dramatic isn’t helpful or productive.
2) Before Electric Vehicles Were Cost Competitive, They Were S3XY
Like many of the CEOs running global brands, Elon Musk is a student of marketing.
In 2008, before it was cool, Tesla released the Roadster. Built on the frame of a Lotus Elise, this fully electric sports car was ahead of its time.
Under Musk’s command, Tesla then went on to create an iconic series of vehicles. First, Tesla released the Model S in 2015, which was followed shortly after that by Model X in 2016. Then came the 3, and most recently - Model Y.
In the late 2000s, the timing for the quote above, battery production was still nascent. Building a cost-competitive electric car wasn’t yet feasible. Instead, Tesla designed the vehicle no one knew they wanted.
One Meme (Finally)
There’s a lot of plastic waste in our oceans.
Most of this waste has been broken down over time into tiny particles called microplastics. Stanford University estimated in 2018 that plastic waste covers as much as 40% of the ocean’s surface. It shouldn’t be surprising then that microplastics are increasingly being found in the fish we eat.
Rest assured, your local fishmonger is unlikely to charge you extra for that.
