On tap: more corporate pledges. Where's the beef?

Sep 06, 2022 View in browser   By Debra Kahn THE BIG IDEA Biden will have more momentum at this year's U.N. climate talks. | (Evan Vucci, Pool/AP Photo) HOT POLICY SUMMER — It's been a summer of massive government spending, but the private sector is getting the jump on sustainability initiatives over the next few months. Here's what we're watching: Pledge week: Corporates will converge on New York from Sept. 19-25 for the flurry of events known as "Climate Week." We're watching Mark Carney's Glasgow Financial Alliance for Net Zero, which is releasing guidance for how companies should demonstrate their climate transition plans to financial institutions. Permitting talks: We'll see within a month whether Congress gets a deal together to speed up permitting of energy infrastructure projects, in line with President Joe Biden and congressional leadership's agreement with Sen. Joe Manchin (D-W.Va.). Attaching it to a must-pass government funding bill will make it a high-wire act, as our POLITICO Energy colleagues report. COP 27: The next round of U.N. climate talks in Sharm El Sheikh, Egypt, in November, will be all about how rich countries should pay for developing countries' damages from climate change, with a hefty dose of U.S.-China drama and concerns about Europe's dependence on Russian energy. We're also looking to see what happens with Article 6 of the Paris Agreement, which allows voluntary carbon markets to interact with national emissions reduction plans. Who knows: The Securities and Exchange Commission's proposed rule on climate risk disclosure. The public comment period ended in June, but there's been no hint of when the agency might meet to approve a final rule. NB: Banking industry groups are breathing easier after the demise last week of a California bill that would have gone further than the SEC rule, our Jordan Wolman reports. Even more MIA: The Biden administration's updated value of the "social cost of carbon," which helps underpin economic analyses of climate rules. It was originally supposed to be out nine months ago, and then by this summer, but nothing doing, our Alex Guillén reports. $181 for your thoughts: Resources for the Future says in a new paper in the journal Nature that CO2 should cost $181 per ton — that's 3.6 times pricier than Biden's current valuation. The new estimate is partly based on increased expectations of damages from climate change, but also on long-term declines in interest rates that should make it a better deal to spend on future emissions reductions. Woke wars: Texas Comptroller Glenn Hegar blacklisted BlackRock and nine other financial firms he claims are boycotting fossil fuel companies. Florida Gov. Ron DeSantis got his state to adopt a resolution to eliminate ESG investing by its $200 billion pension fund. And Indiana Attorney General Todd Rokita said he and Missouri's AG are investigating the Net Zero Banking Alliance for potential antitrust violations. That was all just in the past two weeks. A GOP wave in the midterms could vault all this to Congress.   SUBSCRIBE TO POWER SWITCH: The energy landscape is profoundly transforming. Power Switch is a daily newsletter that unlocks the most important stories driving the energy sector and the political forces shaping critical decisions about your energy future, from production to storage, distribution to consumption. Don't miss out on Power Switch, your guide to the politics of energy transformation in America and around the world. SUBSCRIBE TODAY.     EXTREMES TEXAS TWO-STEP — Speaking of Hegar, Adam Aton of POLITICO's E&E News has a deep dive into how he chose which companies and investment funds to target. Turns out the methodology is even messier than ESG itself. Financial experts called it "completely bonkers" and "juvenile." "They're gonna call it a system and say they have this whole spreadsheet and this whole process," said Witold Henisz, vice dean of the University of Pennsylvania's Wharton School. "But they can manipulate the weights, they can change the rules — none of it is transparent." Another irony: Hegar said he found a lot of firms weren't worth boycotting because they were greenwashing. "There's a body of companies that people think, 'Oh, they're boycotting oil and gas.' But then when you really tear down into it — maybe they're not, but the rhetoric sure shows that," he said. "In other words, they wanna provide an image [that] they're doing one thing, but in reality they're doing another thing." NB: Mike Bloomberg takes on Texas et al in an editorial today : "They don't seem to understand capitalism. And flogging ESG is not only a terrible economic mistake. It will be a political loser, too." BUILDING BLOCKS BLACKOUTS AND PHASEOUTS — California reshuffled its clean energy strategy with a bill Gov. Gavin Newsom signed Friday to keep the state's last nuclear power plant, Diablo Canyon, open until 2030. It's a textbook case of the tradeoffs that climate change is forcing (Germany just did it, too). Pacific Gas & Electric agreed in 2016 to close the plant by 2025, avoiding the need to adapt to a newly discovered earthquake fault. But increasingly hot summer temperatures have been proving too much for the state's grid, which has a surplus of midday solar but not enough storage to save it for the late afternoon and evening. "There are few times where you feel more frustrated as an elected official than when you're getting a call, saying the lights might be going out," Assemblymember Chris Holden (D) said during last week's debate. "And you're left to hope enough Californians conserve or that our utilities are able to squeeze an extra megawatt here or there. That is not a sustainable future for a robust economy." Also not sustainable: Today is the seventh straight day that the state's grid operator is warning of electricity shortages. The heat wave is leading Newsom to temporarily suspend emissions rules for standby generators and ships in port to free up electricity. And it can't help his push for 100% zero-emission vehicles by 2035 that the grid operator is asking EV owners to avoid charging them from 4 p.m. to 9 p.m. Movers and Shakers WHITE HOUSE SHAKEUP — McCarthy out, Podesta in, Zaidi up. Biden's climate chief, former EPA Administrator Gina McCarthy, is leaving on the heels of the White House's major climate spending victory. Ali Zaidi, McCarthy's deputy, will lead the WH climate office in her wake, and John Podesta, chairman of the liberal Center for American Progress, will join as a senior adviser for clean energy innovation and implementation, our Zack Colman reports. Meanwhile, Biden nominated NYU law professor (and social cost of carbon hawk) Richard Revesz to head the Office of Information and Regulatory Affairs, which reviews federal regulations. More from Alex here. YOU TELL US Team Sustainability is editor Greg Mott, deputy editor Debra Kahn and reporter Jordan Wolman. Reach us all at gmott@politico.com, dkahn@politico.com and jwolman@politico.com. Want more? Don't we all. Sign up for the Long Game. Four days a week and still free! WHAT WE'RE CLICKING — The HSBC banker who quit after saying policymakers were overstating the risks of climate change is arguing for disentangling the "risk" and "ethics" sides of ESG. — Unions are an exception to corporate America's new woke worldview — but that might have to change, Adam Lashinsky writes in the WaPo. — Climate change is hurting jacket sales and helping shorts and sandals. — Gender pay disparities are at the root of Brittney Griner's ordeal in Russia.   LISTEN TO POLITICO'S ENERGY PODCAST: Check out our daily five-minute brief on the latest energy and environmental politics and policy news. Don't miss out on the must-know stories, candid insights, and analysis from POLITICO's energy team. Listen today.       Follow us on Twitter Debra Kahn @debra_kahn Greg Mott @gwmott Lorraine Woellert @Woellert Jordan Wolman @jordanwolman   Follow us

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