The Gale Drivers Gazette
“In the coming decade, the gale of destruction sweeping through the electricity and mobility markets will only be matched by the increasing impact of extreme weather”.
That’s how we concluded our 2019 Impact Report for New Energy Nexus. And if the first days of the 2020s have anything to tell us about the next decade, we were on point. Continents burn (witness Australia), companies crumble and crescendo (see Peabody’s collapse vs NextEra’s success in stock valuation over the trailing decade) while capital, per BlackRock, is re-organizing around the climate imperative faster than many realize. They alone are divesting $1.2T from coal!
That’s a trillion. The good news is, we know what we have to do to stave off the worst of climate catastrophe with that finance*.
Electrify everything while decarbonizing that electricity (up next, buildings and then transport by ‘KICKING GAS’ like Arnold says). 100% clean energy for 100% of uses. There are challenges in this plan, like steel making and trucking, but mostly “we got this”. As for the rest of the carbon calculus, we also know what steps to take on land use, diet and agriculture, and C removal (hint: plant trees!). And indeed, we’re taking many of them. Beyond that the economic system itself needs to change long haul for the good of democracy, people and planet. Whether you prefer Klein more than Fink (I do because… but with caveats) both are saying the same thing: We’re on fire and there’s a burning case for a global green new deal!
For now it’s a race of rates. The Keeling Curve’s rise is as relentless as the temperature’s. But similar curves tracking growth in markets for clean energy services, less carbon emitting and / or C capturing goods are also going in the right direction rather fast. It may not seem like it at the foot of an S-Curve but exponential change can be surprising. (We’ll publish more on these vectors of Positive Disruption from forthcoming work by our sister organization, the EPIC Institute, in February to help us find the paths we all have to go down).
Our job is to push the solutions that we have in society that are scaling. Such that PV becomes as ubiquitous as TV. And batteries in homes as common as a fridge. To do this we need entrepreneurship and financial innovation.
From this toil will come terrawatt scale clean energy companies, solar super majors, and trillions of dollars to flow to startups and scale ups. To calibrate this huuge opportunity it is useful to look at Bloomberg NEF’s New Energy Outlook 2019 (see Heat & Transport Electrification Scenario). They note that as strong as the growth of solar, wind and other renewables has been over the last two decades it will have to 3X in the next three decades if we are to keep pace with demand. And if we do indeed electrify everything, we have to 4X deployments by 2050.
Further BNEF show that from the 2030s onwards, we need to be starting and scaling a new set of industries that are yet to be invented (xTechs are zero carbon and run well at low capacity factors as opposed to variable renewables in teal, other systems in purple and fossil fools in grey). So this decade we need to be both inventing and ingeniously combining existing ideas into new solutions while massively deploying those we’ve got.
And what is more, as we re-wire the world and re-shape the commanding heights of the economy, we must take the opportunity to create a more just and better one. This is not just about power without pollution, but a chance to spread power to the people based on the architecture of the new energy technologies. We believe we can make this a time to transform power systems and power relations. To build energy with equality built-in, not the injustice inherent in fossil fuels from extraction thru disposal. We aim to serve 100% of the community with 100% clean energy. Hence the mission of New Energy Nexus to support diverse entrepreneurs to drive innovation and build equity into the global clean energy economy.
To do this we’ll continue to do what we‘ve done for 15 years: Launch, accelerate, fund and scale startups.
Imagine how many more EV charging contractors, ESCOs, rooftop installers, engineering shops, microgrid service companies, community solar coops, battery chemistry corporations, Giga factories, shared mobility businesses, and solar pumping firms amongst a myriad of funds and others must succeed to make 4X by 2050 happen!! And consider where they need to be to serve demand — given that demographic changes mean 80% of humanity will be in Asia and Africa by the end date that we’re focused on (NB half the world’s middle class by spending power is already in Asia!).
We aim to support 100,000 startups to succeed by 2030 alone and have extended our practice to China, India, Indonesia, Vietnam, Thailand, the Philippines and parts of East Africa to be where the action is.
This Gazette will document the gale that is coming. It’s drivers. The trials and tribulations of the energy transition in the shape of the insurgent campanies and compaigns undoing the incumbents. The Oilfall that will come as sure as the collapse of old King Coal. The betterness’ — not just the business’ — that will reshape our economy and create abundance out of our current climate adversity. Our vision is clear. How it unfolds is a story we’ll write with our work and words in coming years. Please follow and share. Shine on!
