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📌 Fact of the week
Honeywell has launched an environmental sustainability index showing sustainability leaders’ sentiment on past progress and future expectations towards corporate environmental goals.
Hottest news of the week…
Regulation 🗃 – European quota for wind turbines?
What happened: This week we are talking about the potential for a new regulation which could support the EU renewable sector. Siemens Gamesa’s CEO, the third largest wind turbine manufacturer, is calling for a quota (i.e. a minimum amount) on the number of EU-produced turbines installed in the region. Why? For energy security purposes and to protect the state of the European industry. In fact, despite the excellent outlook of wind energy capacity in the future, European players are making huge losses and cutting jobs due to cheaper Chinese competitors! 😬
Zoom out: It seems like the current energy crisis hasn’t taught anything to Europe, which is making the same mistakes made on natural gas with Russia, relying too much on a single supplier. Chinese companies made more than half of last year’s wind turbines installations, making Europe extremely susceptible to a potential geopolitical crisis, as it could remain without the necessary capacity and skills to continue its energy transition! If you think the situation is bad… do not look at the “Graph of the week” on solar panels imports from China! 😱
Business 💰 – British Petroleum pushing on biogas!
What happened: British Petroleum (BP) has agreed to buy US biogas maker Archaea energy for $4.1bn in what will be the largest biogas deal ever! British Petroleum is looking to expand its renewables business and to dedicate more than 40% of its capital investments to renewables by 2025, equal to ~$6B per year at current capital expenditure levels. 💰
Zoom out: Biogas, or renewable natural gas, is a gas captured when organic waste (plants, food scraps, and animals’ waste) is broken down by microorganism in absence of oxygen (anaerobic digestion). According to BP’s CEO Bernard Looney, the demand for this renewable gas is higher than supply, especially due to transportation companies that want to use it as a zero-emissions fuel! Although the acquisition has been considered overpriced by financial analysts, it is undeniable that biogas has a bright future ahead, with demand expected to increase by 25x by 2050! 🚀
Innovation 💡 - From “Mitigation” to “Adaptation”!"
What happened: Breakthrough Energy, Bill Gates’ venture capital firm, will soon raise a later stage fund dedicated to “Climate Adaptation”. Currently, the VC fund is focussed only on “Mitigation”, a.k.a. investing in technologies which prevent climate change. A senior representative at the firm stated that “mitigation’s just not going to get us there fast enough”; the adaptation fund will help clean-tech startups scale their technologies in order to develop ways of bolstering protection against the threats of climate change. 🧱
Zoom out: Acknowledging mitigation will not be enough to save the planet is a good first step. As the global economy looks to be plunging into a severe recession, the increased focus on improving business models’ sustainability seems to have faded, as investments might seem prohibitive in an environment characterized by lower economic activity due to higher cost of living. This news is certainly a positive one, as some companies are still looking to deploy capital in the right direction. ➡️
Deep dives of the week…
Graph of the week - Overly reliant on China? 🇨🇳
The importance of China in the solar panels industry is known… What may be unknown is that since the start of the war, Europe turned their focus to solar, as it is considered a quick fix to produce cheaper electricity now that gas prices are crazy. Hence, guess to which country’s door they knocked? Of course China, which now makes more than 90% of EU solar PV panels
Company of the week - Satgana: “A good company”
Climate tech VC firm Satgana, based in Luxembourg, has just launched a fund with a targeted close of EUR 30 million. Satgana, who’s name in Sanskrit translates into “ A Good company”, is looking to invest up to EUR 500k at pre-seed and seed stages in start-ups across Europe and Africa. The fund looks to invest in practically every vertical: food and agriculture, energy, mobility, industry and building, carbon removal and circular economy. We look forward to seeing Satgana funding climate tech winners! 🥇
Tweet of the week - Unstoppable VC activity!
2022 has been a challenging year for VC investments: business models such as grocery delivery have been challenged and look structurally under pressure. In downturns like this one, money tends to be allocated to structural winners for the future. Climate tech has proven to be one of the most resilient verticals: although, lower vs. 2021 as expected, numbers are still comforting!
Source: Twitter
👋 See you next Friday, for the best sum up of this coming week!
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