Crypto News: A new record for clean energy

Today's newsletter is about a new report that shows clean energy investment hit a new record. Later, Ben Elgin finds parcel shipping companies aren't doing so well on delivering climate commitments. For unlimited access to climate news, please subscribe.

By Will Wade

Global spending on the clean-energy transition hit record highs as the world moves to rein in climate change, but it's still not enough to get on track to net-zero emissions.

Total spending surged 17% last year to $1.8 trillion, according to a report Tuesday from BloombergNEF. These include investments to install renewable energy, buy electric vehicles, build hydrogen production systems and deploy other technologies. Add in the investments in building out clean-energy supply chains, as well as $900 billion in financing, and the total funding in 2023 reached about $2.8 trillion.

The record spending reflects the growing urgency of international efforts to combat climate change on the heels of the hottest year on record — and even more heat expected this year. However, the world needs to be investing more than twice as much in clean technology in order to reach net-zero emissions by mid-century, according to BNEF.

China remains the biggest market by far with $676 billion spent last year. That's an increase of only 6% compared to 2022, though. Investments in the US, the UK and Europe grew by at least 22%, in comparison, to a combined total of $718 billion. That was driven in part by incentives in the Inflation Reduction Act, the flagship US climate law, which is starting to have a significant impact. Strong sales of electric vehicles in the UK as well as booming demand for renewables across Europe also helped drive up the total.

Read the full story here.

$634 billion

This is the total spending on EVs globally in 2023 -- a 36% increase from the year before. That made it the sector that saw the largest investments, according to BNEF.

"We're in the steep part of the curve, and we'll see rapid growth [for spending every year]. But whether we get on track for net zero, that's a difficult ask."

Albert Cheung

BNEF's deputy chief executive officer

BNEF warns that governments need to spend even more on clean energy in the coming years. Cheung estimates that investments needs to surge by 170% for the world to get on pace to reach net zero.

By Ben Elgin

The appetite for speedy package delivery is skyrocketing around the planet.

Although it's tantalizingly convenient to have groceries, shoes, pet food and other goods shipped directly to our doorsteps, it comes with a climate cost. FedEx, UPS and DHL, three of the world's large delivery companies, combined to emit 92 million tons of heat-trapping gases in 2022. Much of that total, which surpasses the entire climate footprint of Greece, comes from online shoppers.

Delivery giants for years have tried to tamp down on climate concerns by promising dramatic cuts to their emissions, including rapid deployments of electric delivery vehicles. But how well has the industry followed through on these pledges?

Answering this seemingly simple question has been extraordinarily difficult. While DHL provides detailed data on the composition of its delivery fleet in its environmental filings, many competitors are less clear. UPS, for instance, won't say how many electric vehicles it has deployed; and FedEx, for years, published EV figures that also lumped in ground equipment and forklifts.

DHL's fleet of electric vehicles grew from 6,000 in 2017 to 29,200 in 2022. Photographer: Krisztian Bocsi/Bloomberg

We sought to shine a spotlight on this issue, spending weeks digging through company environmental filings, talking to industry insiders and prodding the companies for clearer answers.

The verdict? There are signs of progress – DHL and Amazon, for instance, have blown past competitors to deploy the most electric delivery trucks in Europe and the US, respectively. Amazon's 1,400 electric delivery trucks in the Houston area, alone, eclipses the entire EV fleets of many other delivery giants.

But the overall picture isn't great. Delivery companies have scaled back many climate pledges and their environmental efforts aren't keeping pace with climbing emissions from the global surge in deliveries.

There are real hurdles, such as the higher upfront cost of EVs, as well as the challenge of deploying thousands of chargers to power up these new vehicles. But it also comes down to the commitment of the companies.

"Of course we can change faster," Angela Hultberg, the former head of sustainable mobility for Ingka Group, which operates most Ikea stores, told me. Ingka Group saw its online orders spike during the Pandemic and the company made 25% of home deliveries in zero-emission vehicles last year. "We just don't have that sense of urgency yet to change that fast. We're still on the timeline of, 'Does this make financial sense?' And 'when will we see cost parity?'"

"Mother Nature," she adds, "doesn't give a s--t about that timeline."

Read the full story here.

Catalonia, home to Spain's second-largest regional economy and popular tourist destination Barcelona, has a plan to live without rain by the end of this decade. The multi-billion-euro strategy — which includes investing in desalination plants — has gained urgency as the region looks likely to soon declare a state of emergency for water, and global warming makes droughts in the future more common.

Government officials said multiple reservoirs across the region have dropped below critical levels, raising concerns that Barcelona is approaching Day Zero, the moment when it will have to bring in water by tanker ships.

Visitors last summer sit in the shade at Poblenou Park, a pinegrove on Barcelona's seafront where the grass hadn't been watered for months due to drought restrictions. Photographer: Angel Garcia/Bloomberg

Swing state voters veer from Biden's climate plans. Some Democrats in upcoming US elections are sounding the alarm about environmental policies that risk turning off cost-conscious moderate voters.

US agriculture officers question bank climate policies. A dozen state agriculture commissioners have asked Wall Street banks to explain how their climate policies impact their lending to farmers.

ESG funds suffer a historic blow. Against a backdrop of attacks by the Republican Party and lackluster returns, ESG funds in the US bled more than a net $5 billion in the final three months of 2023.

The world needs radical solutions to address global warming and climate change. Join Bloomberg Green in Seattle July 10-13 for the inaugural Bloomberg Green Festival, a groundbreaking celebration of thinkers, doers and innovators leading the way into a new climate era. The festival will immerse attendees in solutions-driven experiences with world-renowned experts to inspire climate action. Get 40% off if you secure your tickets by Jan. 31.

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