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Zeus: Why investors are betting the climate farm on carbon capture

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Source: Maxiphoto / iStock via Getty Images

(David Callaway is founder and Editor-in-Chief of Callaway Climate Insights. He is the former president of the World Editors Forum, Editor-in-Chief of USA Today and MarketWatch, and CEO of TheStreet Inc. His climate columns have appeared in USA Today, The Independent, and New Thinking magazine).

SAN FRANCISCO (Callaway Climate Insights) — Today’s top climate headline confirmed what many have long suspected. The earth’s average global temperature will blast through the Paris Agreement’s target of limiting the increase to less than 1.5°C. above pre-industrial levels — maybe even this year.

We’re currently at about 1.1°C. above pre-industrial levels, but the global average temp increase could easily hit 1.5°C. or even 1.8°C. in coming years, according to the World Meteorological Organization. Any one of those years, including this year, could be the hottest on record. Already, we’ve seen record heat waves across Asia and in the Pacific Northwest.

But instead of jolting governments into any sort of emergency carbon emissions reduction plan, world leaders — and investors — are increasingly rolling the dice on the new and unproven technology of carbon capture and storage (CCS). …

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By David Callaway

States Where the Most People Were Displaced by Natural Disasters Last Year

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Source: thenationalguard / Flickr

2022 is ranked third in the number of natural disasters in the U.S. that caused $1 billion in damage. In addition to Hurricane Ian, which ravaged Florida and parts of Georgia in September, severe drought conditions impacted many Western and Central states, major flooding impacted eastern Kentucky and eastern Missouri, and wildfires raged in western states, among the many weather events and natural disasters. As a result, many Americans were uprooted because of severe weather episodes. (These are the 18 separate billion dollar weather and climate disasters in 2022.)

To determine the states with the most people displaced by natural disasters in 2022, 24/7 Wall St. reviewed the U.S. Census Household Pulse Survey conducted between Dec. 9-19. We only included states where at least 1% of the population were displaced due to natural disasters at some point in the previous 52 weeks from when the survey ended and ranked them according to the percent of adults who were displaced. Supplemental data came from the National Oceanic and Atmospheric Administration’s most recent study on Billion Dollar Disasters.

While California dealt with an earthquake in December that killed two as well as drought and a series of wildfires that consumed sections of the Golden State between January and October and claimed nine lives, it is not among the states that had the most displaced adults as a percentage of their population. Still, it is noteworthy as about a quarter of a million adults were displaced due to natural disasters. (California has had more weather disasters than any other state in the last decade.)

In the southeast, where Hurricane Ian tore up swaths of Florida and parts of Georgia in September, a greater portion of the population was displaced. In Florida, almost 1 million adults were displaced as a result of natural disasters that caused as much as $100 billion to $200 billion in damage, both the highest figures of any state. In Georgia, 95,700 adults were displaced, and damages caused by major weather events ranged from $500 million to $1 billion.

By percentage, Florida was not the state where most residents were displaced by disaster. That distinction belongs to Louisiana, where 409,996 people, or 11.9% of all adults, in the Pelican State were displaced due to natural disasters such as the tornadoes that hit the state in December. 

About half of the 18 states on our list had estimated damages caused by major weather events in 2022 of $1 billion or more.

Click here to see states where the most people were displaced by natural disasters last year.

Click here to see out detailed methodology.

Oil industry capture of COP28 complete with invite of Syria’s Assad

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Source: somkuti / Flickr

In today’s edition:

— COP28’s invite of Syria’s Assad assures this year’s event to be an oil affair
— EV stocks’ mixed performance this year obscures booming consumer demand
— Solar capacity is growing faster than almost anyone expected; what’s a terawatt?
— Can solar panels find a new home on those ugly factory rooftops?
— Wildfire season begins early in Western Canada, with almost 90 fires still burning

An electrifying story: Shares of EV makers have diverged sharply this year, marking an even stronger contrast with the surge in electric vehicle sales worldwide, with China, Europe and even the U.S. seeing demand that far exceeds expectations. Green Power $GP , maker of commercial EVs such as school buses, leads the pack, up more than 50% YTD. Li $LI and Tesla $TSLA are catching up. But three of the biggest startup names — Rivian, Fisker, and Lucid — have all continued to struggle as production delays and supply chain problems prevent them from generating the critical mass of new products needed to compete.

Climate eyebrows rose last year when the UAE named Sultan Al Jabar, CEO of the Abu Dhabi National Oil Company, to be president of this year’s COP28 climate conference in Dubai. Mouths gaped last month when Al Jabar said carbon capture, the oil industry’s preferred weapon against global warming, was the future.

But this week world leaders will have to decide whether they even plan to attend the November United Nations event after the UAE invited Syrian President Bashar Al-Assad to participate, as part of an Arab-proposed rehabilitation tour for the reviled politician. Many world leaders, including in the U.S. and UK, currently have sanctions against Assad and his country after the decade-long Syrian civil war.

A PR stunt to be sure, but the invite underscores what has become the complete capture of the COP28 process this year by the oil industry, and one that could drive a wedge between nations at a time when climate cooperation is more needed than ever. If Assad accepts, we can expect calendar schedules to be re-written quickly, and Dubai will be little more than another giant Houston energy conference.

We’ve long argued that the oil and gas industry deserves a number of seats at the table at any serious climate talks. But the takeover of the UN conference like this, and the invitation of one of the most destructive leaders of this young century, is not the way to influence reluctant climate enthusiasts. Or world leaders.

All eyes now turn to UN Secretary General Antonio Guterres for reaction. This one has legs.

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By David Callaway

The Worst Floods in American History

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Source: Michael Bocchieri / Getty Images News via Getty Images

The U.S. averaged 110 flooding-related fatalities a year from 2013 to 2022, according to data  from the National Weather Service. So far in 2023, 26 people have died from flooding events, which is the most lethal of all the weather events in the United States. Even as weather forecasting technology improves, nature’s powerful forces remain unpredictable and often deadly.

To find the worst floods in U.S. history by the number of fatalities, 24/7 Wall St. used government sources such as the NWS Weather Forecast Office, the National Oceanic and Atmospheric Administration, and the U.S. Geological Survey as well as media reports about flood events. In order to capture the scope of these tragic historical chapters in our nation’s history, we tried to include any and all weather-related events that could have contributed to floods.

Much of the severe flooding in America has occurred around the Mississippi River and in Texas, as well as along the Gulf Coast and Florida, because those areas are vulnerable to hurricanes. (These are 20 states with the highest risk of flooding.)

There are three categories of floods: flash flooding, river flooding, and coastal flooding. 

The most dangerous are flash floods, caused by rainfall intensity and duration. Topography also plays a role – if the soil is too sodden with moisture, it may not be able to absorb rainfall. 

Flash flooding can also lead to mudslides, particularly in western states. Steep ravines and canyons can funnel high volumes of water, exacerbating flood intensity. Other reasons for flash flooding are the rupture of a dam, slow-moving storms, or a surge of water released from an ice jam.

There were historic consequences from the Mississippi River flooding in 1927. Black Americans living in the flood zone were forced to evacuate their homes in the South, accelerating what would become known as the Great Migration to northern cities. (See the states where the most people were displaced by natural disasters last year.)

A more recent example of fatalities from coastal flooding and storm surge was Hurricane Ian. That tempest slammed into Florida, the Carolinas, and Virginia in September and October 2022, causing approximately 155 fatalities in the U.S., mostly in Florida, plus at least five in Cuba.

Climate change has raised concerns of increased flooding and the impact that flooding from rising sea levels will have on those living on American coasts. Scientific advances, including better observational data, improved climate models, and more sophisticated detection methods have made it possible to attribute extreme weather events to rising global temperatures.

Click here to see the worst floods in American history.

Betting on China’s green transformation; plus Norway’s all-electric future is now

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Source: bingfengwu / iStock via Getty Images

(A native of England, veteran journalist Matthew Diebel has worked at NBC News, Time, USA Today and News Corp., among other organizations.)

Doing laundry, a green transformation is revealed

The Chinese tend to get things done fast. I know this in part because I volunteer at an ASPCA animal shelter in New York City where my work partner is a charming and energetic Chinese woman. Most of our tasks involve washing, drying and folding the towels and sheets used in the dog and cat enclosures, and while I am folding one towel, she has done two.

We talk a lot, and last week the conversation turned to Hong Kong, which I have visited a couple of times and like very much. She is also fond of the bustling former British colony, having traveled there many times from her hometown, Shenzhen, which lies immediately to the north.

I then quizzed her about Shenzhen. “Is it heavily polluted like a lot of Chinese cities?” I asked. “Well, it used to be,” she said. “When I was a child, there were terrible smogs and the waterways were badly polluted. But, when I was a teenager things started to change.”

That’s because, in 2010, the central government designated Shenzhen, which has about 13 million inhabitants, to be among 11 provinces and cities to develop and pilot low-carbon solutions for industry, transport, renewable energy, construction, consumption and ecology…

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By David Callaway

The 18 Worst US Weather Disasters of the Past Year

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Source: Michael Bocchieri / Getty Images News via Getty Images

From hurricanes to wildfires to hail, the United States experienced another above-average year of catastrophic weather events last year. In fact, eighteen weather disasters inflicted losses exceeding $1 billion, one of which topped $100 billion.  

These billion-dollar (and multi-billion-dollar) weather and climate disasters killed at least 474 people, led by Hurricane Ian, a massive Category 5 storm that slammed into Florida in September. The relentless drought and heatwave conditions that baked much of the country throughout the year, also resulted in considerable losses.

The number of these costly climate events, adjusted for inflation, averaged 7.9 per year from 1980 to 2022. But in the most recent five-year period, that average has more than doubled, to 17.8 per year, according to the National Oceanic and Atmospheric Administration. (Here are the deadliest billion-dollar weather disasters in U.S. history.)

To identify the 18 separate billion-dollar weather and climate disasters in the United States in 2022, 24/7 Wall St. reviewed the Billion-Dollar Weather and Climate Disasters database of the NOAA’s National Centers for Environmental Information. The NCEI has been tracking the inflation-adjusted cost of these disasters since 1980, using the consumer price index, or CPI, to adjust for inflation. The NCEI data combines public and private peer-reviewed disaster loss data to provide a historical record of these events as well as to quantify their direct costs.  

Last year saw extreme storm activity in the central and southern regions of the contiguous United States, including massive weather systems that dumped hail in Texas, Arkansas, Minnesota, and Wisconsin, inflicting billions of dollars of damage. (Not all states experience as many natural disasters. In fact, California has had more weather disasters than any other state in the last decade.)

Out of these 18 expensive climate disasters, 11 are categorized as severe storms, meaning heavy precipitation over short periods of time, high wind gusts, and tornadoes, including more than 100 twisters that broke out over two days in April in the southeast.

Three hurricanes in 2022 caused between $1 billion and $113 billion in damage, mostly in Florida, while a stalled storm system over parts of Missouri and Kentucky in July turned creeks into raging, debris-laden torrents that killed at least 42 people and resulted in nearly $1.5 billion in damage.

Here are the billion-dollar climate disasters of the past year.

Microsoft fusion deal an early sign Big Tech sees renewable energy like AI

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Source: lcva2 / iStock Editorial via Getty Images

At first glance, Microsoft’s $MSFT deal this week to buy renewable energy generated by nuclear fusion from Helion Energy by the end of the decade seems like just another in a long list of tech moonshots. Self-driving cars, Internet powered eye-glasses, trips to Mars, etc. Anything to find the next booming revenue stream.

Nuclear fusion hasn’t been achieved yet, after all. Though Helion has come close, claiming to have reached about 100 million Celsius by smashing two atoms together (as opposed to splitting them in the traditional nuclear fission), which is about half the temperature scientists think will be needed to produce commercially viable energy from fusion.

Whether Washington-based Helion can make good on its promise to be sending Microsoft and others 50 megawatts of fusion-generated energy by 2029 remains to be seen. But one thing this deal makes clear: Big Tech, and particularly Microsoft, aim to be big players in the renewable energy game, just like they do with AI.

Bill Gates’s Breakthrough Energy Ventures is big on traditional fission, for example. But in creating micro-generators that can be moved around. Elon Musk is big on wind and solar. Jeff Bezos is investing in a Canadian fusion startup, General Fusion.

As we saw with Microsoft’s investment in OpenAI late last year, these big tech companies have the resources to bet early and bet big on new ideas. The fusion deal should be taken by investors as a signal that the technology to create fusion, like the sun, might be closer than we think.

There are no publicly traded fusion companies right now. So, like with AI, the best way to speculate on the potential of these new technologies is with Big Tech itself. Microsoft shares, by the way, are up 30% year-to-date.

Forget ‘woke’ investors; free market raising the climate cost in Florida, Texas

. . . . Anti-ESG attacks on Wall Street are growing, but so are the costs of climate risks to investors and residents in states led by global warming’s fiercest critics. And ‘woke’ extremists aren’t to blame. It’s the good old free market itself, writes Mark Hulbert. An analysis of recent insurance reports by Hulbert shows that insurance companies, which use math, not politics, in setting rates, are charging residents in Florida and Texas more for homeowner’s insurance because of the climate risks in those states. And passing on generally higher rates to everybody to subsidize them. . . .

Read the full column

Thursday’s market insights

. . . . When the CEO of the world’s largest producer of renewable energy acts, people notice. And that’s what’s happened with Florida-based NextEra Energy $NEE , which has announced it will sell its natural gas pipelines to focus solely on green power. We look at their reasoning. Read more. . . .

. . . . Have you seen those BlackRock ads on TV? Acoustic guitar music. “Regular folks” doing their stuff? They’re because the finance giant is fighting an almighty battle against forces who are campaigning against the growing use of environmental, social and governance (ESG) considerations by investors and company executives. Read more. . . .

Editor’s picks: Drought areas shift; plus, regulating the jet fuel in your drinking water

Regulating the jet fuel in your drinking water

A federal appeals court in Washington, D.C. this week sided with environmental groups that have challenged the EPA’s failure to set drinking water safety limits for perchlorate, a chemical found in rocket fuel and explosives. E&E News reports on the court case focusing on the EPA’s continuation of a Trump-era decision not to set Safe Drinking Water Act regulations for the chemical, which it describes as “a notorious contaminant near military sites and contractor facilities, entering groundwater and at times jeopardizing drinking water.” The report cites Senior Judge David Sentelle as writing in the court’s majority opinion: “Because the Safe Drinking Water Act requires that the agency ‘shall’ regulate after making a regulatory determination, EPA lacks authority to withdraw that determination and decide that it ‘shall not’ regulate.” The EPA reportedly has said it is reviewing the court decision but offered no further comment.

‘Pivot point’ for massive Everglades restoration plan

Federal and Florida state agencies have been working for more than 70 years to tame the Everglades, but climate change is forcing a rethinking of its restoration, InsideClimateNews reports. The U.S. Army Corps of Engineers and South Florida Water Management District are poised to begin a new restudy of the Everglades’ historic water management infrastructure aimed at adapting the framework to deal with rising seas, violent storms and a continuing influx of people, according to the report. Hurricanes, sea-level rise, and extreme weather events are among the issues that prompted the National Academies of Sciences, Engineering and Medicine in November to say climate change needs more attention in its latest federally mandated review of progress on Everglades restoration. “Inadequate consideration of water availability under future conditions and potential variations in the rate of sea-level rise could cause a project to move forward that is not viable under future climate change,” the scientists wrote.

Latest findings: New research, studies and projects

It’s a small world after all

Are land-locked countries subject to sea-level rise risk? The authors of the paper titled We are All in the Same Boat: Cross-Border Spillovers of Climate Shocks Through International Trade and Supply Chain highlight a new mechanism by which physical climate shocks affect countries’ macro-financial performance: the cross-border spillover effects that propagate through international trade. Basing their findings on historical data between 1970 and 2019, they report that climate disasters which strike the transport infrastructure — ports — decrease the affected country’s imports and exports and reduce economic output in major trade partner (both upstream and downstream) countries. Climate disasters reduce stock market returns in the aggregate market and tradable sectors of the major trade partner countries. Exposures to foreign long-term climate change risks reduce the asset price valuations of the tradable sectors at home. As a result, climate adaptation efforts in one country can have a positive impact on macro-financial performance and stability in other countries through international trade. Authors: Alan Feng, Princeton University Department of Economics; International Monetary Fund; Haishi Li, University of Hong Kong; Yulin Wang, University of Hong Kong.

Words to live by . . . .

“Energy security at its most basic level means having reliable sources of power for various needs. It means being protected against risks that threaten you. One of the major risks today is climate change.” — Sherri Goodman, national security executive and public policy leader, speaking with We Don’t Have Time.

By David Callaway

Forget ‘woke’ investors; free market raising the climate cost in Florida, Texas

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Source: Joe Raedle / Getty Images News via Getty Images

(Mark Hulbert, an author and longtime investment columnist, is the founder of the Hulbert Financial Digest; his Hulbert Ratings audits investment newsletter returns.)

CHAPEL HILL, N.C. (Callaway Climate Insights) — Florida residents are paying $803 more per year for homeowners insurance because of climate change risks. Texas residents are paying $1,170 more.

That’s the conclusion I reached from my analysis of homeowner insurance rates in those states most vulnerable to climate-related disasters. There is a statistically significant correlation between the magnitude of that vulnerability and insurance rates.

There is much irony in this conclusion. Florida and Texas have led the charge against so-called “woke” finance. Asset managers have been prevented from doing business with state agencies for having the audacity to, in effect, suggest that climate change poses huge investment-related risks. Ironically, the folly of these two states’ approach is being revealed not by a bunch of bleeding-heart liberals but by that bastion of conservative ideology: The free market.

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By David Callaway

Lung Cancer Is the Deadliest Cancer in America

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Source: Sean_Warren / E+ via Getty Images

This article was written with the assistance of A.I. technology, and has been edited and fact-checked by Colman Andrews.

Cancer is a disease that has been with us for a long time, and it is still a deadly threat. Each year, cancer kills more than 600,000 people in the United States, and remains the second leading cause of death in the nation after heart disease.

Lung cancer is the deadliest cancer in America. Between 1999 and 2019, it claimed the lives of more than 3.2 million people. From 2010 to 2018, only 23% of lung cancer patients were still alive five years after diagnosis.

There are many risk factors for lung cancer, including smoking, breathing of secondhand smoke, and exposure to certain chemicals and pollutants. People who have lung cancer often have no symptoms in the early stages of the disease. This can make it difficult to catch the disease early, when it is most treatable.

There has been significant progress in the treatment of lung cancer in recent years. However, it remains a deadly disease. It is important for people to be aware of the risks , and the Centers for Disease Control and Prevention recommends that all adults get regular screenings for lung cancer.

Click here to see which cancers are the deadliest in America.

By Douglas McIntyre

Electric vehicle sales are soaring. So why is Warren Buffett selling?

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Source: Ford Motor Co.

In today’s edition:

— Electric vehicles sales are soaring. EV stocks, not so much.

— Investing in impact startups dropped last month as recession fears rose

— As the market for electric vehicles booms, another comes along for the ride — tires
— The carbon emissions from gold mining are staggering
— Locus Technologies secures big new cloud software deal as demand for ESG tools grows

One of the biggest stories in renewable energy this spring is the surge in electric vehicle sales worldwide, with China, Europe and even the U.S. seeing demand that far exceeds expectations. But not so much on the EV stocks side.

Three of the biggest startup names in electric vehicles in the U.S. — Rivian $RIVN , Fisker $FSR and Lucid Motors $LCID have all continued to slump as production delays and supply chain problems prevent them from generating the critical mass of new product needed to compete with the big boys such as Ford $F and General Motors $GM . All three report earnings this week and, so far, investors have been disappointed.

Whenever a new industry takes off, some of the early startup stars fall by the wayside, but it looks like changing global economic and geopolitical conditions might be affecting the big boys, too. Warren Buffett, who nobody takes for a climate enthusiast, has been selling his decade-old stake in Chinese EV maker BYD for the past six months. He sold another 2 million shares last week, according to the South China Morning Post, bringing total sales to about 100 million shares, or half his stake.

The latest sale comes as BYD has fallen by a third in value this year, despite headlines showing it dominating EV sales in China. It is now bigger than Tesla $TSLA . Over the Covid era, the stock surged sixfold. So perhaps Buffett is simply taking profit. Or perhaps he’s more worried about investing in China these days, something he hinted about over the past weekend at his annual weekend wisdom-fest in Omaha.

Either way, the weakness in EV stocks at a time when demand is growing is a troubling indicator of economic road bumps to come, and a sign that the road to success in the fledgling EV industry isn’t going to be a one-way street. Investors in batteries, tires, charging stations, and other EV offshoots take notice.

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By David Callaway

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