Can US shale gas save Europe from its energy crisis?

On the surface, booming US shale gas production looks like the perfect solution for Europe as its reels from the energy crisis created by tearing itself away from Russian gas. But analysts say it is no panacea.

US shale gas output has lost none of its momentum, as the US shale revolution is fading as far as oil is concerned.

In western Texas’s Permian Basin – one of the world’s most important oil and gas production areas – gas prices actually went negative in October because output was so high that producers had to pay people to take it off their hands.

And compared to oil, “there is potential for more growth”, said Kenneth B. Medlock III, senior director at the Center for Energy Studies at the Baker Institute for Public Policy at Rice University in Houston.

This looks like the perfect situation for the US’s allies across the Atlantic as the energy crisis racks the old continent. Indeed, EU imports of liquified natural gas (LNG) from the US have already soared since Russia invaded Ukraine and Europe cut off its dependence on Russian gas – increasing by over 148 percent in the first eight months after the invasion compared to the same period the previous year. Most of this gas comes from shale drilling.

“The entire reason US LNG exports are even possible to begin with is because of the shale revolution,” emphasised Eli Rubin, a senior energy analyst at energy consultancy EBW Analytics Group in Washington DC. “If it weren’t for that, the US would be importing LNG on a pretty widespread basis, competing with European countries for natural gas supplies.”

‘The problem is export capacity’

Yet analysts caution that, while LNG from US shale can help Europe amid its energy crisis, it will not single-handedly rescue the old continent.

“I don’t think Europe will ever receive as much gas as LNG from the US as it did from Russia through pipelines,” said Samantha Gross, director of the Energy Security and Climate Initiative at the Brookings Institution in Washington DC. “Europe got a lot of gas from Russia; it’s a tremendous amount of gas to replace.”

“There is an issue in terms of how much gas the US can get to Europe, at least in the short term,” Rubin said. “The problem is export capacity, not the amount of gas the US is producing,” Gross agreed.

Exporting natural gas is a complicated and expensive process, requiring liquification, transport to export terminals, boats to move the gas to the country buying it, then a regasification process when it gets there. A lack of capacity at any of these points creates supply constraints – so supply is lagging a boom in demand.

The example of the Permian Basin last autumn illustrates this – there was abundant demand for all that gas, but as Rubin put it, “the pipelines do not yet exist to take of all the gas from West Texas to East Texas so it can be exported”.

“The US will take three to five years to really ramp up infrastructure for LNG export,” Rubin continued. “As far as the short-term outlook goes we do have this bottleneck in terms of export capacity.”

Importing non-liquified gas through a pipeline is therefore much cheaper and easier for Europe – coming without the need for liquification, transport by land and boat, and regasification. “One of the reasons why Russian gas was so cheap for Europe was that it came through a pipeline,” Rubin observed.

‘No one saviour’

Hence Europe has been keen to boost gas supplies from its near abroad, especially where pipeline infrastructure is already in place.

EU Commission President Ursula von der Leyen went to Baku in July to sign a deal doubling the bloc’s gas imports from authoritarian Azerbaijan, using a network of pipelines to Italy called the Southern Gas Corridor.

The same month, then Italian prime minister Mario Draghi travelled to Algeria to sign a series of deals to ramp up gas imports, even as a political crisis brewed in Rome. Again, a pipeline makes the gas simpler and less expensive to import than if it came in the form of LNG – namely the TransMed pipeline from Algeria to Italy set up in 1983. Closer to home, gas-rich Norway has turbocharged gas supplies to the rest of Europe, benefitting from the Langeled pipeline. And when it comes to LNG, Qatar has also become integral to Europe’s scramble for new gas sources.

But there are limits to all four of those countries as gas suppliers to Europe. “Any further increases in pipeline exports of natural gas from Azerbaijan and Algeria are likely to be small relative to the increase in global LNG capacity,” noted Stephen Fries, a nonresident senior fellow at the Peterson Institute for Economics in Washington DC and an associate fellow at Oxford University’s Institute for New Economic Thinking. “The pipeline from Azerbaijan to Europe is already operating at capacity. Algeria’s capacity to produce more natural gas is uncertain.”

As things stand Qatar exports over 70 percent of its LNG to Asian countries, locked into long-term contracts. With regard to Norway, the North Sea gas fields “are not depleted but they are not what they used to be”, Gross pointed out.

In the long term, the ecological transition away from fossil fuels should mean that European countries will no longer want to buy large quantities of gas, with the EU promising to become net zero by 2050 – although whether that will be soon enough to help prevent the catastrophic effects of climate change is another matter entirely.

But this long-term paradigm shift complicates Europe’s bid for a short-term solution to its energy crisis. “The biggest challenge for Europe buying gas is that it’s not clear they will want it for long enough,” Gross put it. “These are multi-billion dollar contracts, and 10 to 15 years of using the gas is not a long enough payback period.

“I hear a lot about US gas supplies saving Europe or someone else saving Europe from its energy crisis – but there’s no one saviour,” Gross concluded. “It’s going to take a portfolio of capacities to replace a lot of gas they got from Russia. That means a lot sources, plus consuming less gas – plus the energy transition.”

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Chairman FAO: Western powers pressure China’s UN food boss to grip global hunger crisis

ROME, Italy — The Chinese head of a crucial U.N. food agency has come under intense scrutiny by Western powers, who accuse him of failing to grip a global hunger crisis exacerbated by Russia’s war in Ukraine.

Qu Dongyu, director general of the Food and Agriculture Organization, has alienated the Western powers that are the agency’s main backers with his technocratic leadership style and connections to Beijing that, in their view, have damaged its credibility and capability to mitigate the crisis.

POLITICO has interviewed more than a dozen U.N. officials and diplomats for this article. The critical picture that emerges is of a leader whose top-down management style and policy priorities are furthering China’s own agenda, while sidelining the U.N.’s Sustainable Development Goals.

Russia’s invasion of Ukraine in February was met with weeks of eerie silence at the FAO, and although the messaging has since changed, Qu’s critics say FAO should be showing stronger political leadership on the food crisis, which threatens to tip millions more people into hunger.

“Nobody actually takes him seriously: It’s not him; it’s China,” said one former U.N. official. “I’m not convinced he would make a single decision without first checking it with the capital.”

In his defense, Qu and his team say a U.N. body should not be politicized and that he’s delivering on the FAO’s analytical and scientific mandate.

Chairman FAO

Qu Dongyu was elected in 2019 to run the Rome-based agency, handing China a chance to build international credibility in the U.N. system, and punishing a division between the EU and the U.S after they backed competing candidates who lost badly. The election was clouded by allegations of coercion and bribery against China.

Now, as he prepares for a likely reelection bid next year to run FAO until 2027, Qu — who describes himself as a conflict-averse “humble, small farmers’ son” — is under intensifying scrutiny over his leadership during the crisis.

After three years of largely avoiding the headlines, Qu drew criticism from countries like France and the U.S. for his sluggish and mealy-mouthed response to Russia’s invasion of Ukraine, a massive exporter of food to developing countries.

The EU and U.S. forced an emergency meeting of the FAO’s Council in the spring in order to pressure the FAO leadership into stepping up to the plate, with Ukraine demanding he rethink his language of calling it a “conflict” and not a war. The communications division was initially ordered to keep schtum about the war and its likely impacts on food supply chains. In May, Ukrainians protested outside FAO HQ in Rome demanding Russia be kicked out of the organization.

At a meeting of the FAO Council in early December, countries like France, Germany and the U.S. successfully pushed through yet another demand for urgent action from FAO’s leadership, requesting fresh analysis of impact of Russia’s war on global hunger, and a full assessment of the damage done to Ukraine’s vast farm system.

China has not condemned Russia outright for invading Ukraine, while the EU and the U.S. use every opportunity in the international arena to slam Moscow for its war of aggression: Those geopolitical tensions are playing out across the FAO’s 194 member countries. Officials at the agency, which has $3.25 billion to spend across 2022 and 2023, are expected to act for the global good — and not in the narrow interest of their countries.

Qu is said still to be furious about the confrontation: “[He] is still upset about that, that really annoyed him,” said one ambassador to the FAO. “He sees the EU as an entity, a player within the FAO that is obstructing his vision.”

Qu featured on a TV screen inside the FAO headquarters in Rome | Eddy Wax/POLITICO

Though Qu has now adapted his language and talks about the suffering being caused by Russia’s war, some Western countries still believe FAO should respond proactively to the food crisis, in particular to the agricultural fallout from Russia’s invasion of Ukraine. The FAO’s regular budget and voluntary funds are largely provided by EU countries, the U.S. and allies like Japan, the U.K. and Canada. The U.S. contributes 22 percent of the regular budget, compared to China’s 12 percent.

Qu is determined to stick to the mandate of the FAO to simply provide analysis to its members — and to steer clear of geopolitics.

“I’m not [a] political figure; I’m FAO DG,” he told POLITICO in October, in an encounter in an elevator descending from FAO’s rooftop canteen in Rome.

FAO’s technocratic stance is defended by other members of Qu’s top team, such as Chief Economist Máximo Torero, who told POLITICO in May: “You are in a war. Some people think that we need to take political positions. We are not a political entity that is the Security Council — that’s not our job.”


Qu can hardly be said to be apolitical, as he is a former vice-minister of agriculture and rural affairs of the Chinese Communist Party.

On top of his political background he has expertise in agriculture. He was part of a team of scientists that sequenced the potato genome while he was doing a PhD at Wageningen University in the Netherlands. In an email to POLITICO his professor, Evert Jacobsen, remembered Qu’s “enthusiasm about his country,” as well as is “strategic thinking” and “open character.”

Yet Western diplomats worry that many of the policy initiatives he has pushed through during his tenure map onto China’s foreign policy goals.

They say that the U.N. Sustainable Development Goals have been eclipsed by his own initiatives, such as his mantra of the Four Betters (production, nutrition, environment, life), and Chinese-sounding plans from “One Country, One Priority Product” to his flagship Hand-in-Hand Initiative.

Some Western diplomats say these bear the hallmarks of China’s Global Development Initiative, about which Qu has tweeted favorably.

Detractors say these are at best empty slogans, and at worst serve China’s foreign policy agenda. “If the countries that are on the receiving end don’t exercise agency you need to be aware that these are policies that first and foremost are thought to advance China, either materially or in terms of international reputation, or in terms of diplomacy,” said Francesca Ghiretti, an analyst at the Mercator Institute for China Studies (MERICS).

Insiders say he’s put pressure on parts of the FAO ecosystem that promote civil society engagement or market transparency: two features that don’t go down well in Communist China. The former U.N. official said Qu had subjected the G20 market transparency dashboard AMIS, housed at FAO, to “increased pressure and control,” causing international organizations to step in to protect its independence earlier this year.

The diplomat said Qu was trying to suffocate the Committee on World Food Security, which invites civil society and indigenous people’s groups into FAO’s HQ and puts them on a near-equal footing with countries. “What has he accomplished in two-plus years? You can get Chinese noodles in the cafeteria,” they said.

Flags at the entrance to the FAO headquarters in Rome | Eddy Wax/POLITICO

But at a U.N. agency that has historically been deeply dysfunctional, Qu is popular among staff members.

“Mr. Qu Dongyu brought a new spirit on how to treat staff and established trust and peace between staff and management,” said one former FAO official.

Even his sharpest critics concede that he has done good things during his tenure. He made a point of shaking every staff member’s hand upon his election, even turning up occasionally unannounced to lunch with them in the canteen that he’s recently had refurbished. There’s also widespread appreciation among agriculture policymakers of the high quality of economic work turned out by FAO, and support for his climate change and scientific agenda.

“The quality of data FAO produces is very good and it’s producing good policy recommendations,” one Western diplomat acknowledged.

FAO play

Three years into his term, there’s a much stronger Chinese presence at FAO and Chinese officials occupy some of the key divisions, covering areas such as plants & pesticides, land & water, a research center for nuclear science and technology in agriculture, and a division on cooperation between developing countries. A vacant spot atop the forestry division is also expected to go to a Chinese candidate.

Experts say those positions are part of a strategy. “China tries to get the divisions where it can grow its footprint in terms of shaping the rules, shaping the action and engaging more broadly with the Global South,” said Ghiretti, the MERICS analyst.

The EU Commission is closely monitoring trends in staff appointments and data collection. “He’s hired a lot of young Chinese people who will fill [the] ranks later,” said an EU diplomat.

Mandarin is heard more than before in the corridors of the Rome HQ, a labyrinthine complex built in the 1930s by Fascist dictator Benito Mussolini to house its ministry of overseas colonies.

Western diplomats and staffers past and present describe Qu as a poor communicator, who displays little care about engaging with or being accountable to countries and who tends to leave meetings after delivering perfunctory remarks, all of which leaves space for rumor and suspicion to grow.

Even those who acknowledge that Qu has made modest achievements at the helm of FAO still see his leadership style as typical of a Chinese official being kept on a tight leash by Beijing. The EU and U.S. criticized Qu’s move to push back an internal management review that was meant to be conducted by independent U.N. inspectors, and will now likely not emerge until after the next election.

And although FAO is still receiving bucketloads of Western funding, its fundraising drive specifically for rural families and farmers in war-torn Ukraine is still $100 million short of its $180 million target, a pittance in an international context — especially amid deafening warnings of a global food supply crisis next year.

That’s partly because the U.S. and EU prefer to work bilaterally with Kyiv rather than going through FAO. “This is the time for FAO to be fully funded,” said Pierre Vauthier, a French agronomist who runs the FAO operation in Ukraine. “We need additional money.”

A plaque outside Qu’s fourth floor office at the FAO headquarters in Rome | Eddy Wax/POLITICO

There’s no love lost on Qu’s side, either. In June, he went on a unscripted rant accusing unnamed countries of being obsessed with money, apparently in light of criticism of his flagship Hand-in-Hand Initiative.

“You are looking at money, I’m looking to change the business model because I’m a farmer of small poor, family. You from the rich countries, you consider the money first, I consider wisdom first. It’s a different mentality,” Qu said, before complaining about his own salary being cut.

Asked repeatedly, Qu did not confirm to POLITICO whether he would stand for a second four-year term, but traditionally FAO chiefs serve at least twice and he is widely expected to run. Nominations officially opened December 1. The question is whether the U.S., EU or a developing nation will bother trying to run against him, when his victory looks all but inevitable.

There’s competition for resources between the World Food Programme (WFP), a bastion of U.S. development power, and FAO. A Spaniard, Alvaro Lario, was recently appointed to run the third Rome-based U.N. food agency, the International Fund for Agricultural Development, while WFP’s chief David Beasley is expected to be replaced by another American next year.

In any case, the countries that Qu will likely count on to be re-elected are not so interested in the political machinations of the West or its condemnation of the Russia’s war in Ukraine, which it seeks to impress upon FAO’s top leadership.

“Our relations with the FAO are on a technical basis and not concerned by the political positions of the FAO. What interests us is that the FAO supports us to modernize our agriculture,” said Cameroon’s Agriculture Minister Gabriel Mbairobe.

Other African countries defend FAO’s recent track record: “They’ve been very, very active, let’s be honest,” said Yaya A.O. Olaniran, Nigeria’s ambassador to the FAO. “It’s easy to criticize.”

This story has been updated.

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Biodiversity: ‘A victim of global warming and one of the major tools to fight against it’

After the COP27 climate conference, representatives from around the world gathered in Montreal this week for the COP15 meeting dedicated to biodiversity. Scientists say leaders face a crucial challenge: agreeing on a common way forward to safeguard biodiversity by 2030 in order to preserve plant and animal life and help combat climate imbalance.

Wildlife populations have fallen by 69 percent globally in the past 50 years, the World Wildlife Fund (WWF) said in an October 2022 report. At the same time, land degradation – including deforestation, soil erosion and loss of natural areas – now affects up to 40 percent of the Earth’s land and half of humanity, according to the UN. These alarming figures are the backdrop for the COP15 conference on biodiversity that began on December 7 in Montreal with an ambitious objective: to agree a new global framework for safeguarding the natural world.

“The stakes are crucially high: we are currently living through a biodiversity crisis,” says Philippe Grandcolas, entomologist and research director at France’s National Centre for Scientific Research (CNRS). “Biodiversity is essential to human survival. It ensures that we can feed ourselves, have access to drinking water, and it plays a major role in our health. But, above all, biodiversity plays an indispensable role in the stability of the planet.”

At present, 70 percent of ecosystems around the world are in a state of degradation, largely due to human activity – a rate of decline described as “unprecedented and dangerous” by the Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services (IPBES).

In addition, more than 1 million species are threatened with extinction. Vertebrates, which include mammals, fish, birds, reptiles and amphibians and make up five percent of all animal species, are especially under threat. “Our previous report found that there had been a 68 percent fall among the total [vertebrate] population [over 50 years],” says Pierre Cannet, director of advocacy and campaigns at WWF France. In 2022 that figure has risen to 69 percent. “Losing one percent in two years is massive. For species that already have small populations, it could mean extinction.”

Climate imbalance: A growing threat 

According to the IPBES, the most significant driving factor of the ”biodiversity crisis” is change in how land is used and fragmentation of natural space, most often due to agriculture. This is followed by overfishing, hunting and poaching. There is a tie for third place between climate imbalance, pollution and invasive species.

“In the majority of cases there are multiple factors at play,” says Grandcolas. “But climate imbalance is becoming the most significant threat. The more it escalates, the more it disturbs ecosystems and has an impact on flora and fauna.”

There are plenty of examples of this impact. In the past 30 years elephant populations in African forests have fallen by 86 percent. The main causes are poaching and black market trade, causing the death of 20,000 to 30,000 elephants per year, according to the WWF. But repeated cycles of drought and flood are also having an impact on access to fresh water – a vital resource for the species as each animal consumes around 150 to 200 litres per day. Without it their survival is at risk.

Similarly, leatherback sea turtles in Suriname have seen their populations fall by 95 percent in 20 years. This is due in part to destruction of their habitat caused by human intervention and illegal fishing. But climate instability is also disrupting their reproduction rates as sea level rise has destroyed and disrupted turtle nesting beaches.

A leatherback turtle (Dermochelys coriacea) digging a nest on the beach in Trinidad. © Konrad Wothe, WWF

Mass deaths 

“Currently there are a few species that are classed having climate change as the reason for their extinction,” says Camille Parmesan, research director at CNRS and author of the first report of its kind on the links between climate change and biodiversity, produced by IPBES and the UN’s Intergovernmental Panel on Climate Change (IPCC) in 2021. Yet this is the reason for the demise of the Bramble Cay melomys: “a species of little rodent that lived on the small islands between Australia and Papua New Guinea. Scientists proved that their disappearance was due to their habitat being submerged [by the sea],” Parmesan says.

“We have also noted the disappearance of 92 amphibian species, killed by the growth of a type of fungus. We have proof that it developed due to climate instability which modified ecosystems and created the right conditions for it to thrive.”

The number of species that are officially classed as having died out due to climate instability may be low, but increasing extreme weather events are causing mass deaths among mammals, birds, fish and trees. “In Australia, we counted 45,000 flying fox deaths [a type of bat] in a single day during a heatwave”, Parmesan says. In France, record summer heat in 2022 caused temperatures in the Mediterranean Sea to rise to levels that killed thousands of fish and shellfish.

>> Biodiversity: Ocean ‘dead zones’ are proliferating due to global warming

Yet, disappearing species is not the only consequence of climate change. “We can also add behaviour changes, notably migrations induced by climate modifications,” Parmesan adds. “Certain species try to move to [new] habitats that are more favourable but this can cause even more disruption in ecosystems.”

Biodiverse carbon storage 

Shrinking biodiversity also has multiple consequences on human life. In some parts of the world it can disrupt economies reliant on fishing or hunting and negatively impact the tourism industry.

“It’s a vicious circle. Biodiversity is a victim of global warming, but it is also one of the major tools to fight against it”, says Sébastien Barot, researcher at French public research institution Institut de recherche pour le développement (IRD).

From plant life to animal species, individual elements of the natural world all contribute to regulating and supporting the environment as a whole. Bardot says, “water and earth play a role in filtering pollution, and bumblebees are essential for plant reproduction”.

But when one element is compromised the rest can suffer too. “The survival of the planet depends on a fine balance,” says Grandcolas. “Imagine a group of frogs suddenly die in a habitat. As insignificant as that may seem, it will have an impact: by disappearing they modify the conditions of the environment. This could allow other species to develop, damage plant life and lead to progressive destruction of the ecosystem, which will then no longer be able to play its role as a climate regulator.”

Nowhere is this more evident that with carbon storage. Scientists estimate that the earth and sea currently absorb almost 50 percent of C02 created by human activity.  “Forests, wetlands, mangrove swamps and even deep water are real C02 sinks. When they disappear, emissions are released into the atmosphere,” Barot says.

Consequently, “when we see a forest burn, we are watching a carbon sink disappear”, says Grandcolas. In this way, “[the presence of] plant life has an obvious impact on the climate.”

Two crises, one solution? 

Experts agree on the need to tackle both the climate crisis and the biodiversity crisis at the same time. “We tend to treat them as separate entities, but they go hand in hand,” says Grandcolas. “They should be seen as a joint struggle with equal importance. For this to happen, we need to give nature the space it deserves.”

Scientists and the WWF have called for more nature-based solutions for both issues. One of the most prominent is increasing protected habitats, which currently make up 17 percent of land and eight percent of ocean globally. “We need to increase that to 30-50 percent of the planet,” says Grandcolas. A significant step towards this goal, he adds, would be better global policies for fighting deforestation as preserving forests has the potential to both protect biodiversity and reduce greenhouse gas emissions.

“There are also many things to consider in terms of agriculture,” says Barot. “We need agriculture systems that are more durable such as developing agroecology and agroforestry. We can improve how cultivated land is managed and limit use of fertilizer … which would help both biodiversity and the climate.”

“Protection alone is no longer enough; 70 percent of land is now in a degraded state,” Parmesan adds. “It is essential to put stronger policies in place for restoring ecosystems. That would enable us to recreate habitats for animals and plants, and the climate benefits would follow.” For this to be successful a holistic approach is needed. “There’s no point planting trees purely to compensate for carbon emissions,” Parmesan says. “It needs to be done with respect for balance in the ecosystem. Big plantations filled with monocultures are not good for biodiversity or for the climate because they are more vulnerable to climate risks.”

The three scientists estimate that nature-based solutions could provide around a third of necessary climate mitigation measures even if other steps, such as reducing greenhouse gas emissions, must come from changes in human behaviour.

Many such solutions are up for discussion at the COP15 biodiversity conference. Even so, other issues – namely money – may dominate. Supported by 22 other countries, Brazil has requested that rich nations provide “at least $100 billion per year until 2030” to developing countries in order to finance nature protection initiatives. The request is yet to receive a response.

This article was adapted from the original in French

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Paul Polman: The world needs a Marshall Plan to fight climate change–and politicians are failing to show ambition. Business can’t afford to wait

The COP27 climate talks in Sharm el-Sheikh were a missed opportunity. The pledge to keep global temperature rises under 1.5 degrees is just about alive, affirmed by G20 leaders in Bali–but there’s no clear plan to deliver it.

The Sharm deal doesn’t include a commitment to phase out all fossil fuels or any guarantee that emissions will peak by 2025. Current national carbon reduction targets get us closer to a devastating three-degree rise. A powerful group of blockers–mainly oil-rich governments and companies–were out in force.

There were bright spots. By creating a new fund for “loss and damage,” rich countries are finally taking some financial responsibility for producing most of the emissions already causing mayhem in poorer countries. This is a significant breakthrough for a multilateral system dangerously low on trust. Let’s hope the money follows.

More governments committed to methane cuts. Enhancing nature and reforming food systems were formally recognized as part of the climate fight. And tighter measures were proposed to avoid greenwashing.

However, the urgency of the crisis is clearly still lost on many of our political leaders. Collectively, they are failing to deliver the ambition and action on which our planet and future depend. This situation is not going to magically improve. Next year’s COP28 will be held in the oil-rich United Arab Emirates–and will be just as easily hijacked.

There will be no great superpower pact to save us: despite diplomatic baby steps between Washington and Beijing, their cooperation will be limited as long as Russian tanks are in Ukraine and America fears for Taiwan’s security. Even with the U.S., Australia, and Brazil back at the table, ongoing troubles in the global economy and high inflation threaten to push global warming down domestic agendas (even though tackling climate change is the best way to stabilize energy and food prices).

Business literally can’t afford to sit back and wait for politics to get its act together. Climate isn’t just an environmental issue: it’s the economy, stupid. Extreme floods, heat waves, wildfires, and hurricanes cost billions. They send impoverished nations further into debt, while crippling supply chains, disrupting global trade, and destroying the labor force. Whether you are a C-Suite executive, an investor, or the WTO, you have a major interest in getting the world onto a more stable path. There are tremendous gains waiting for those who move quickly. The shift to a low-carbon economy can add trillions of dollars to global growth each year, and create millions of jobs.

Even as politics stalls, business can still push ahead. Beyond companies getting their own houses in order, there are three immediate things business leaders can do.

The first is advocating for much-needed reform of our global financial architecture. The idea that we will need a Marshall Plan-style intervention to finance the shift to a greener economy is starting to gain traction. CEOs can help bring it into the mainstream.

The fringes of Sharm saw much discussion of Barbados Prime Minister Mia Mottley’s Bridgetown Agenda, which calls for climate to be fully integrated into the mandates of the post-WW2 Bretton Woods institutions, which would dramatically increase the resilience and capacity of the Global South.

Professor Lord Stern has calculated that, if developed countries significantly increase grants and low-interest loans through expanded aid, it could attract $1 trillion of private investment to help finance the transition. Such proposals warrant urgent investigation–and business can demand it.

Second, senior executives can do more to lead vital partnerships for change. Across industry, government, and civil society, we will have to collaborate on climate in ways we never envisaged. It’s starting to happen–and it’s time to ramp up the speed and scale of collaboration.

In Bali, we helped launch the Global Blended Finance Alliance, including the biggest ever single climate transaction, which mobilizes $20bn from governments and private finance to support Indonesia’s effort to close coal mines and peak its emissions early.

Led by the Rockefeller Foundation (where I sit on the board) another coalition of investors, entrepreneurs, and public officials will bring clean energy to 1 billion people, including many in Africa.

And business and farmers aim to dramatically scale regenerative agriculture and improve livelihoods within seven years through the Regen10 initiative.

Third, is bringing more young people to the table, fast. The young activists I met in Sharm were sharp, determined, and sick of being patronized. They are powerful–as employees and consumers, as our sons and daughters, as the next generation of leaders, and as voters. Many are frustrated with the political process and look to the private sector to empower them in a new, intergenerational alliance that has an impact on the real economy. Here too, business can act: put them on boards, on panels, in leadership positions, and in every room where decisions affecting their futures will be taken.

There’s no need to feel hopeless–but we must recognize that our politics is failing to deliver vital climate action. We must find other ways to close the ambition gap, get the money moving, get business driving urgent coalitions, and make sure young people are firmly in the driving seat. Then, it will be up to politics to catch up.

Paul Polman is a business leader and campaigner, and the author of Net Positive: how courageous companies thrive by giving more than they take.

The opinions expressed in commentary pieces are solely the views of their authors and do not necessarily reflect the opinions and beliefs of Fortune.

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The big new Exxon Mobil climate change deal that got an assist from Joe Biden

Could it be that Big Oil’s next big thing got a big assist from Joe Biden?

Maybe, if carbon capture and storage is indeed as big a deal as ExxonMobil’s first-of-its-kind deal to extract, transport and store carbon from other companies’ factories implies.

The deal, announced last month, calls for ExxonMobil to capture carbon emitted by CF Industries‘ ammonia factory in Donaldsonville, La., and transport it to underground storage using pipelines owned by Enlink Midstream. Set to start up in 2025, the deal is meant to herald a new stage in dealing with carbon produced by manufacturers, and is the latest step in ExxonMobil’s often-tense dialogue with investors who want oil companies to slash emissions.

The Inflation Reduction Act, passed in August, may determine whether deals like Exxon’s become a trend. The law expands tax credits for capturing carbon from industrial uses in a bid to offset the high up-front costs of plans to capture carbon from places like CF’s plant, as other tax credits in the law lower costs of renewable power and electric cars.

The Inflation Reduction Act and Big Oil

The law may help oil companies like ExxonMobil build profitable businesses to replace some of the revenue and profit they’ll lose as EVs proliferate. Though the company isn’t sharing financial projections, it has committed to investing $15 billion in CCS by 2027 and ExxonMobil Low-Carbon Solutions president Dan Ammann says it may invest more.

“We see a big business opportunity here,” Ammann told CNBC’s David Faber. “We’re seeing interest from companies across a whole range of industries, a whole range of sectors, a whole range of geographies.”

The deal calls for ExxonMobil to capture and remove 2 million metric tons of carbon dioxide yearly from CF’s factory, equivalent to replacing 700,000 gasoline-powered vehicles with electric versions.

Each company involved is pursuing its own version of the low-carbon industrial economy. CF wants to produce more carbon-free blue ammonia, a process that often involves extracting ammonia’s components from carbon-laden fossil fuels. Enlink hopes to become a kind of railroad for captured CO2 emissions, calling itself the would-be “CO2 transportation provider of choice” for an industrial corridor laden with refineries and chemical plants.

An industrial facility on the Houston Ship Channel where Exxon Mobil is proposing a carbon capture and sequestration network. Between this industry-wide plan and its first deal for another company’s CCS needs, ExxonMobil is hoping that its low-carbon business quickly scales to a legitimate source of revenue and profit.


Exxon itself wants to develop carbon capture as a new business, Amman said, pointing to a “very big backlog of similar projects,” part of the company’s pledge to remove as much carbon from the atmosphere as Exxon itself emits by 2050.

“We want oil companies to be active participants in carbon reduction,” said Julio Friedmann, a deputy assistant energy secretary under President Obama and chief scientist at Carbon Direct in New York. “It’s my expectation that this can become a flagship project.”

The key to the sudden flurry of activity is the Inflation Reduction Act.

“It’s a really good example of the intersection of good policy coming together with business and the innovation that can happen on the business side to tackle the big problem of emissions and the big problem of climate change,” Ammann said. “The interest we are seeing, the backlog, are all confirming this is starting to move and starting to move quickly.”

The law increased an existing tax credit for carbon capture to $85 a ton from $45, Goldman said, which will save the Exxon/CF/Enlink project as much as $80 million a year. Credits for captured carbon used underground to enhance production of more fossil fuels are lower, at $60 per ton.

“Carbon capture is a big boys’ game,” said Peter McNally, global sector lead for industrial, materials and energy research at consulting firm Third Bridge. “These are billion-dollar projects. It’s big companies capturing large amounts of carbon. And big oil and gas companies are where the expertise is.”

Goldman Sachs, and environmentalists, are skeptical

A Goldman Sachs team led by analyst Brian Singer called the law “transformative” for climate reduction technologies including battery storage and clean hydrogen. But its analysis is less bullish when it comes to the impact on carbon capture projects like Exxon’s, with Singer expecting more modest gains as the law accelerates development in longer-term projects. To speed up investment more, companies must build CCS systems at greater scale and invent more efficient carbon-extraction chemistry, the Goldman team said.

Industrial uses are the third-largest source of greenhouse gas emissions in the U.S., according to the EPA. That’s narrowly behind both electricity production and transportation. Emissions reduction in industrial uses is considered more expensive and difficult than in either power generation or car and truck transport. Industry is the focus for CCS because utilities and vehicle makers are looking first to other technologies to cut emissions.

Almost 20 percent of U.S. electricity last year came from renewable sources that replace coal and natural gas and another 19 percent came from carbon-free nuclear power, according to government data. Renewables’ share is rising rapidly in 2022, according to interim Energy Department reports, and the IRA also expands tax credits for wind and solar power. Most airlines plan to reduce their carbon footprint by switching to biofuels over the next decade.

More oil and chemical companies seem likely to get on the carbon capture bandwagon first. In May, British oil giant BP and petrochemical maker Linde announced a plan to capture 15 million tons of carbon annually at Linde’s plants in Greater Houston. Linde wants to expand its sales of low-carbon hydrogen, which is usually made by mixing natural gas with steam and a chemical catalyst. In March, Oxy announced a deal with a unit of timber producer Weyerhauser. Oxy won the rights to store carbon underneath 30,000 acres of Weyerhauser’s forest land, even as it continues to grow trees on the surface, with both companies prepared to expand to other sites over time.

Still, environmentalists remain skeptical of CCS.

Tax credits may cut the cost of CCS to companies, but taxpayers still foot the bill for what remains a “boondoggle,” said Carroll Muffett, CEO of the Center for International Environmental Law in Washington. The biggest part of industrial emissions comes from the electricity that factories use, and factory owners should reduce that part of their carbon footprint with renewable power as a top priority, he said.

“It makes no economic sense at the highest levels, and the IRA doesn’t change that,” Muffett said. “It just changes who takes the risk.”

Friedman countered by saying economies of scale and technical innovations will trim costs, and that CCS can reduce carbon emissions by as much as 10 percent over time.

“It’s a rather robust number,” Friedmann said. “And it’s about things you can’t easily address any other way.”

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Clashes as thousands march in France against agro industry water ‘megabasins’

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Thousands of demonstrators defied an official ban to march on Saturday against the deployment of new water storage infrastructure for agricultural irrigation in western France, according to organisers.

Clashes between paramilitary gendarmes and demonstrators erupted with Interior Minister Gérald Darmanin reporting that 61 officers had been hurt, 22 seriously, but giving no toll for casualties among protesters.

Bassines Non Merci” a pressure group that brings together environmental associations, trade unions and anti-capitalist groups, organised the demonstration against what it claims is a “water grab” by the “agro-industry” in western France.

The deployment of giant water “basins” is underway in the village of Sainte-Soline, in the Deux-Sèvres department, to irrigate crops, which opponents claim distorts access to water amid drought conditions.

Around 1,500 police were deployed according to the prefect of the Deux-Sèvres department Emmanuelle Dubée who said she expected some 5,000 demonstrators to descend on the village of around 350 inhabitants.

Dubée said on Friday that she had wanted to limit possible “acts of violence”, referring to the clashes between demonstrators and security forces that marred a previous rally in March.

The Sainte-Soline water reserve is the second of 16 such installations, part of a project developed by a group of 400 farmers organised in a water cooperative to significantly reduce mains water usage in summer.

The open-air craters, covered with a plastic tarpaulin, are filled by pumping water from surface groundwater in winter and can store up to 650,000 square metres of water.

This water is used for irrigation in summer, when rainfall is scarcer.

Opponents claim the “megabasins” are wrongly reserved for large export-oriented grain farms and deprive the community of access to the essential resource.


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