Week 28: What happened to the biofuel revolution?

Biofuels had a dramatic fall, but could still save air travel. Renewable energy companies violate human rights. We're still digging for oil. And a breakthrough in batteries.

Dear subscribers,

Welcome to yet another edition of ‘ESG on a Sunday’.

What happened to the biofuel revolution?

This week we start in the sky. Over the past couple of years there has been a lot of discussion and political commitment around “greening” the air travel.

In a number of progressive political parties across Europe and the world increased use of biofuels is a key element for the transition of this heavily scrutinised sector (which in reality stands for just 4% of global carbon emissions).  

The devil is in the numbers. With a growing number of people using air travel, especially in Asia, carbon emissions are expected to increase rapidly over the next 20 years. Solutions? Well, either we travel less or we find new ways to power the engines that bring us from one continent to another.

This very good article gives you a very realistic overview regarding biofuels and the complexity of the situation. 

So what is the status? Well, according to BloombergNEF, global investments in biofuel production capacity have plunged from $22.9 billion in 2007 to just $500 million in 2019.

This has significant implications for the decarbonising of transportation, and even though biofuels production has grown in recent years, the current growth is clearly insufficient to support the requirements of the energy transition.

Today, biofuels account for only a tiny fraction of global jet fuel consumption—less than 0.1% in 2018, according to the International Energy Agency.

To reignite the industry, biofuels need the type of government incentives that allowed solar and wind companies to flourish.

Renewable energy companies violate human rights

On that note, we move on to a very, let’s just call it sensitive subject. Renewable energy production is good for planet, people and profit. Right. And it is far better than any other source of energy production. Everyone understands that. And it’s correct too.

But there are things related to the production and management of renewable energy that have significant impact on human right issues. The transition to a net-zero carbon economy is a human rights imperative for all people. But it cannot come at the expense of the most vulnerable among us.

This first global human rights benchmark of the largest wind and solar companies reveals that most of them lack the essential human rights policies to avoid abuse of the communities and workers on which a just transition depends.

The deployment and expansion of renewable energy technologies will play an integral role in reducing our collective carbon footprint, but can come at a cost for workers and communities if companies do not ensure respect for human rights in their operations and through their supply chains.

The ambitious and necessary goal of achieving carbon neutrality by 2050 requires equally robust steps to ensure this transition is truly just.

Since 2010, Business & Human Rights Resource Centre has identified 197 allegations of human rights abuses related to renewable energy projects, and asked 127 companies to respond to these allegations.

Abuse allegations include: killings, threats, and intimidation; land grabs; dangerous working conditions and poverty wages; and harm to indigenous peoples’ lives and livelihoods.

Allegations have been made in every region and across each of the five sub-sectors of renewable energy development: wind, solar, bioenergy, geothermal, and hydropower.

The region with the highest number of allegations is Latin America (121 allegations since 2010, 61% of allegations globally). Eight of the 16 companies ranked in the benchmark have allegations of human rights abuse linked to their renewable energy operations.

We’re still digging for oil 😱

We move on to the fact that we are all – including you and me – financing the expansion of the fossil fuel industry.

How? Well, public finance (i.e. finance supported by our tax money via public financial institutions) is fuelling further expansion of the fossil industry.

In 2015, by adopting the Paris Agreement, governments around the world committed to keeping global warming to well below 2 degrees Celsius and to strive to limit warming to 1.5 degrees.

However, this analysis shows that since the Paris Agreement was made, G20 countries have acted directly counter to it by providing at least USD 77 billion a year in finance for oil, gas, and coal projects through their international public finance institutions.

The G20 countries have provided more than three times as much support for fossil fuels as they have for clean energy.

A breakthrough in batteries

We have to end this on a positive note. And after all, there are many, many attempts to change things all over the world. Some more interesting than others.

This is one of the interesting attempts and it gives you a glimpse of a new development in the field of batteries as well as very good idea of where we are.  

Lithium-ion batteries play a central role in the world of technology, powering everything from smartphones to smart cars, and one of the people who helped commercialize the cars says he has a way to cut mass production costs by 90% and significantly improve their safety.

Hideaki Horie, formerly of Nissan Motor Co., founded Tokyo-based APB Corp. in 2018 to make “all-polymer batteries”. Earlier this year the company received backing from a group of Japanese firms and they are now getting ready to begin mass production.

That’s it for now. Happy Sunday reading!

Best regards, Sasja