Greenify #78: Autos' Transition Story
September 8, 2023
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📌 Fact of the week
According to the IEA, 2022 clean energy spending in Africa was only 2% of the global total, despite covering 20% of the earth’s land and being the world’s sunniest region.
Hottest news of the week…
Regulation 🗃 – Establishing EV’s
What happened: The US Department of Energy has revealed a $12 billion plan to convert US automaker and supplier facilities into EV manufacturing centers, particularly in regions with pre-existing auto manufacturing infrastructure. An extra $3.5 billion will boost advanced battery production, , with the overall goal of reducing emissions from the transportation sector.😎
Zoom out: This manoeuvre is supporting President Biden's goal of two-thirds EV market share by 2032 and net-zero emissions by 2050, while protecting the US automotive industry and its jobs. Europe is facing a very similar problem, with important automakers that may be be forced to cut workforce and lose market share as consumers shift to EVs. What could Europe do? A lot of things, but a first useful step would be to copy what the US has just done! 📈
Business 💰 – Stellantis e-fuels play
What happened: Car maker Stellantis has revealed that, in Europe, 24 types of internal combustion engines it produced since 2014 are able to be filled with advanced e-fuels without modifications. E-fuels are a type of synthetic fuel suitable for use in combustion-engined vehicles. Unlike petrol and diesel, which are produced from oil, synthetic fuels are man-made from renewable resources. In simple words, using e-fuels would clean the carbon footprint of traditional internal combustion engine vehicles. However, their use and penetration will ultimately depend on the vehicle owner’s choice. 💪
Zoom out: The auto industry is a key piece of the puzzle to get to net zero. Electric vehicle penetration is growing massively in developed countries, with some governments even having announced sales bans on international combustion engine vehicles. For example, in the UK, the only new cars which will be sold after 2035 will be pure electric cars/hydrogen powered cars; other European countries are still debating on whether to implement the ban. What is certain is e-fuels which are able to fit in internal combustion engines can be a relatively good compromise as the industry transitions to full electric. 💡
Innovation 💡 - New batteries in town
What happened: Eos Energy, a zinc batteries maker, is close to receiving a $400 million loan by the U.S. Department of Energy. The company’s zinc batteries are an alternative, and relatively new, solution to lithium batteries, which currently dominate the market. Among the advantages of zinc batteries, we find increased stability, non flammability and increased lifespan, particularly important in the context of a large problem deriving from batteries’ waste. For more info on the technology, check the MIT Technology Review article.🔋
Zoom out: As the world transitions to clean energy and green power generation, the importance of batteries increases exponentially. Renewables such as solar and wind are characterized by high intermittency, hence can be unreliable. Batteries’ purpose is to provide a reliable storage place for the generated energy. As batteries costs have come down significantly over the last decade, Eos knows it won’t be able to compete unless it offers a cheap solution; to that point, the $400m loan would provide it with enough capital to add production lines to its existing factory, thereby scaling up production and being able to compete. 💚
Deep dives of the week…
Chart of the week - ICE’s Future
Despite growth in electric vehicles across the globe, internal combustion engine (ICE) vehicles still dominate the market when it comes to volumes sold. We clearly expect the EV portion to increase further over the following years, supported by political action, but we do acknowledge that e-fuels, as discussed in our Business news, can play an important part in the meantime. Indeed, despite there might be bans on sales of new ICE cars post 2035 in some countries, that does not exclude previously sold ICE vehicles to actually stay on the road until beyond 2035.🚓
Source: IEA
Deals of the week
Paptic - reducing packaging’s emissions
Paptic, a Finnish firm focusing on the development of sustainable packaging materials as substitutes for plastics, has successfully raised €23 million in a Series A funding round with participation from the European Circular Bioeconomy Fund (ECBF), Ecolab, and Itochu Fibre Ltd.
Paptic's leading product, Paptic®, is a recyclable and renewable fiber-based material designed to supplant traditional packaging materials and plastics. The company's core objective is to diminish the use of fossil-based materials in flexible packaging.
The global market for flexible packaging, valued at over €200 billion annually, is heavily reliant on plastics, which constitute 70% of the materials employed. Paptic is poised to enter this market by offering sustainable, recyclable alternatives to plastics.♻️
UrbanVolt - having solar panels is now cheaper and stress free
UrbanVolt, the leader in the Solar-as-a-Service sector, has secured a substantial €26 million investment from Verdane, a prominent European growth investor. This investment boosts UrbanVolt's total funding to over €200 million.
Solar-as-a-service includes financing, installation, and maintenance of solar panels, enabling customers to acquire solar-generated electricity at a nearly 40% less expense than conventional utility providers and completely stress-free. What sets UrbanVolt apart is its commitment to rate stability, ensuring customers enjoy price predictability for up to 30 years.
The company is already leader in the sector with more than 150 partnerships with leading businesses. ☀️
👋 See you next Friday, for the best sum up of this coming week!
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