Net Zero

1. Conservative climate action
2. Biden’s final checklist
3. Hydrogen anxiety
4. Tesla’s Trump bump
5. China’s next EV target

Climate tech VCs aren’t hitting the brakes, but Nissan and Bentley are.

COP29, which starts in Baku on Monday, will be the first chance for world leaders and climate activists to regroup ahead of another four years with Donald Trump. I’m heading there tomorrow, and expecting to encounter a lot of frustration and depression. One negotiator told me, only half jokingly, that they almost canceled their flight when the election results were announced.

The US delegation, Biden’s last, will definitely suffer from a drop in negotiating clout. But it’s a big world, and there are plenty of other countries ready to step into the power vacuum, especially China. Jonathan Pershing, a former top climate negotiator under Biden, told reporters yesterday the biggest story to watch won’t be the US leaving the room, but whether any countries follow them in walking away from the Paris Agreement — and he doesn’t think any will. Stay tuned here for special coverage from the ground.

And if you’ll be in Baku yourself, get the inside scoop on how the Biden team plans to secure its climate legacy in a live journalism event where I’ll quiz White House National Climate Advisor Ali Zaidi. The event will be at the Goals House in downtown Baku on the evening of Nov. 13, and will also feature discussion about the roles Wall Street and Silicon Valley will play in meeting global climate goals with Adam Elman, Google’s EMEA director of sustainability, and Yemi Lalude, head of Africa at the private equity giant TPG. If you’d like to join, please request an RSVP at netzero@goalshouse.com. Hope to see you there!

The conservative climate agenda

With Donald Trump heading back to the White House and a Republican sweep of Congress looking increasingly likely, the small but growing cohort of climate-focused conservatives has a chance to push for a different approach to the energy transition. Outright climate science denial is far less common among Republicans than it was during Trump’s first term, and the fact that most clean-energy funding from the Inflation Reduction Act has gone to Republican districts will make it politically untenable to repeal the law.

But the country’s strategy will change in key ways: Expect more support for advanced nuclear power, and for technologies like carbon capture and methane-based hydrogen that are favored by the oil and gas industry, while Trump will push for greater LNG exports. A legislative deal on permitting reform may be more achievable: A spokesperson for Sen. Shelley Moore Capito (R-W.V.), who is set to lead the environment and public works committee, said a top priority will be “to cut red tape that slows down infrastructure projects.” In general, the conservative vision for climate action is all about cutting red tape, said Chris Barnard, president of the American Conservation Coalition, an advocacy group: “The North Star under a Trump administration is a vision that extends beyond the traditional ‘drill, baby, drill,’ to more like, ‘build, baby, build’.”

Biden’s final checklist

The Biden administration is rushing to finalize a study about the climate impacts of LNG exports, which it could leave behind as a legal obstacle to Trump’s gas aspirations. The study started in January, part of the administration’s decision to suspend the issuance of permits for new LNG export terminals, one of the energy policies that Trump has promised to scrap on his first day in office. If the study concludes that increasing LNG exports is not in the public interest — because they could raise domestic gas prices and global emissions — the study would provide ammunition for climate groups to challenge Trump’s LNG policies in court.

Other last-minute climate priorities for Biden include finalizing more loans from the Department of Energy, settling on hydrogen tax-credit rules, and pushing other countries for an ambitious climate finance deal at COP29, even though the latter two at least would likely be undone by Trump. Biden can also finalize a waiver for California under the Clean Air Act that allows the state to move further than the federal government on emissions regulation, which is “going to be an important avenue for continued progress in case of federal backsliding,” said Sonia Aggarwal, CEO of the think tank Energy Innovation.

Battling green hydrogen anxiety

One of the highest-valued US climate startups may shift its operations to Europe depending on how the Trump administration handles a vital but nascent corner of the climate tech market, its co-founder told Semafor. The US hydrogen industry has been stalled as the Biden administration has moved slowly to finalize tax credit rules for the sector, mostly due to disputes over arcane carbon accounting methods. The Trump administration is likely to take a much more permissive approach to hydrogen tax credits because they are eagerly sought by major oil and gas companies that are keen to build out their hydrogen divisions.

But according to Raffi Garabedian, CEO of Electric Hydrogen, lax carbon accounting will make it much harder for truly “green” hydrogen to compete on cost with methane-based hydrogen in the US — especially if the Trump administration walks back incentives for the wind and solar energy that are the key ingredients for green hydrogen. Trump’s Department of Energy may also cut resources for its hydrogen “hub” program, the main federal strategy for driving hydrogen demand. Altogether, Garabedian said, it could add up to a bleak landscape for green hydrogen in the US, just as industrial emissions regulations in Europe and Japan have the opposite effect.

“If the election had gone the other way, we might have rekindled more interest in domestic projects and customers,” he said. “If our view on the European market continues to solidify, and our outlook for the US market worsens, then there’s no reason my business should stay in the US. That would be a shame, but I think it’s probably also true for many other companies in the energy transition and climate tech.”

Tesla’s Trump bump

Jump in Tesla share price following Trump’s reelection. CEO Elon Musk got significantly richer thanks to Trump’s victory, which he had enthusiastically supported. Musk’s close relationship with the president-elect will put him in an unparalleled position to influence policy decisions related to electric vehicles, and Tesla’s scale in the EV market relative to legacy automakers will allow it to thrive even without consumer EV tax credits and with even more aggressive trade restrictions on battery imports from China. Tesla’s share boost bucks the broader trend for clean energy: Renewable energy and EV stocks plummeted this week, while oil stocks surged.

China is targeting the ‘electric donkey’ industry

In Washington, Brussels, and elsewhere, Western policymakers have been laser-focused on the threat to automotive jobs from Chinese carmakers, whose hybrids and battery-powered vehicles are racing ahead of competitors from the US and Europe. Meanwhile, Chinese companies have been strengthening another, lower-profile EV sector in their home market — and now they are looking to extend that dominance worldwide.

Electric two-wheeler mopeds first appeared on China’s roads about 20 years ago, but thanks to a confluence of factors, they are now ubiquitous. And with their domestic market increasingly saturated, the companies that make them are casting their ambitions abroad.

“The next opportunity is to go global,” Zhou Chao, vice president of Yadea, a major Chinese electric two-wheeler brand, recently told 21st Century Business Herald.

In many ways, the humble two-wheeler is the most successful electric vehicle China has ever rolled out on a scale that is truly mind-blowing.

More than 45 million are sold every year in China, Joseph Constanty, senior director of global strategy and growth at NIU, a Nasdaq-listed Chinese electric two-wheeler brand, told me. Nationwide, some 400 million electric two-wheelers — mostly mopeds — were zipping on the road at the end of 2023, according to state-run newswire Xinhua, compared to 20.4 million electric cars. In my hometown, Shanghai, the number of electric mopeds reached 10 million last year, meaning one in every 2.5 people owned one. The vast majority of these look like Vespas and are designed to travel no faster than 25 kilometers, or about 15 miles, an hour. Technically, they are classified as electric bicycles in China and, when fully charged, can cover 40-60 kilometers.

The 2024 election cycle is finally over — so, what’s coming to your screens next? Ben and Nayeema dissect what the media learned from 2024 and where we go from here. They first chat to Semafor’s Max Tani about the news media, and then sit down with Ankler Media’s Janice Min, who has been reporting on (and embedded in) Hollywood culture for decades. The conversation tackles whether politics and art stay linked or divorce, if Donald Trump will wake up “wokeism” again or if Americans turn to escapism, and why TV is chasing the “gourmet cheeseburger.”

New Energy

• China-based Trina Solar, one of the world’s biggest renewables companies, will sell its major solar panel plant in Texas amid growing scrutiny of how Chinese companies are benefiting from Inflation Reduction Act tax credits.
• BP pulled the plug on 18 hydrogen projects as part of its refocus on the core oil and gas business.
• The world is running dangerously low on electric grid transformers, the top maker of them warned, creating a complex new bottleneck in the energy transition.

Fossil Fuels

• As it continues to disconnect from Russian pipelines, Europe’s supply of natural gas for the winter looks precarious, traders have warned. Meanwhile, Ukraine has still not settled on a plan for how to replace the Russian gas flowing across its territory once the pipeline deal between the two countries expires at the end of this year.

• Namibia’s plans to become a new major offshore oil producer could be upended by unexpectedly high concentrations of gas in its oil deposits.
• Trump’s reelection has the leaders of Iran’s oil industry concerned about the return of sanctions.

Finance

• Of $155 million in climate finance received by the Bahamas, only $10 million has been earmarked for adaptation, the special adviser on climate change to the country’s prime minister warned, highlighting a major imbalance that will be under scrutiny at COP29.

Politics & Policy

• China lashed out at European policymakers over the EU’s tariffs on EVs, and called for a debate on “unilateral restrictive trade measures” at COP29.
• Utility regulators in the US are pocketing millions in campaign contributions from the companies they are meant to oversee.

EVs

• Despite opposition from some automakers, the EU will stick with a plan to ban sales of new gas-engine vehicles by 2035.
• Nissan cut 9,000 jobs and slashed its CEO’s pay in half after falling to a profit loss in the third quarter because of waning demand for EVs. Bentley pushed off its target to switch entirely to EVs from 2030 to 2035.
• Toyota, meanwhile, is reveling in its decision to focus on hybrids — especially after Trump’s reelection.

Food & Agriculture

• Deforestation in Brazil’s Amazon fell 31% in the last 12 months compared to the previous year, to its lowest point in nearly a decade.

Ted Dillon, chief operating officer at Clean Energy Ventures.

Kenya’s opposition activists are celebrating Donald Trump’s election in hopes of reevaluating US support for President William Ruto’s unpopular economic policies, Semafor’s Martin K.N Siele reported. Ruto’s association with Biden has fueled disaffection towards his administration, and critics of Washington’s approach see the US as “an enabler of harmful government decisions in Kenya,” Siele wrote.