The worrying combo of crypto and carbon; plus the Bank of England comes up short

Welcome to Callaway Climate Insights. The first big wildfires of the season are upon us. Please share.

Blue Ridge Hotshots and engines burning out on the Mescal Fire, one of two major blazes east of Phoenix. Those fires have exploded, with each growing between 10,000 and 14,000 acres in the last 24 hours. Bureau of Land Management photo by Mike McMillan/via WildfireToday.com.

Two signs of the climate finance apocalypse this week, as stock markets flirt with record highs.

A California non-profit claims to be the first carbon offset program to accept donations in cryptocurrencies, which are notoriously carbon-intensive, especially Bitcoin. Carbon Offsets to Alleviate Poverty (COTAP.org) said it wants to offer crypto investors a chance to make up for their contribution to the world’s expanding carbon footprint by allowing them to donate to the program.

A clever fundraising idea that covers the surge in demand for both crypto and carbon offsets these days. But one which does little to answer the question of what happens when you combine two products of debatable value to fight two issues — climate change and poverty — of humanitarian importance.

The second was news that former Enron CEO Jeff Skilling is out of prison and back in the energy game, with a new fund. The company, Veld LLC, has developed software to enable the securitization of oil and gas production sites and applied for two names, Veld Applied Analytics and Shalemetrics.

Skilling has more than paid his debt for his role in Enron’s collapse two decades ago but it’s interesting to see he’s back in the energy game, which has changed so much since he last strode over the industry from Enron’s Houston headquarters. Securitization of oil and gas assets could be a profitable play as those assets face challenges from renewables. At the very least, it shows he still recognizes value — and demand — for some of the properties.

File both under old dogs and new tricks.

More insights below. . . .

Don’t forget to contact me directly if you have suggestions or ideas at dcallaway@callawayclimateinsights.com.

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Wednesday’s subscriber insights: Bank of England stress tests lack teeth

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. . . . The Bank of England ordered climate stress-testing on its bank and insurance companies Wednesday, as the UK became the second European country to do so after France. But without linking the tests to capital requirements, the exercise is just so much navel-gazing. Read more here. . . .

. . . . The collapse of the infrastructure talks in Washington D.C. look worse than originally reported, with major bones of contention being President Biden’s landmark climate initiatives themselves. Without those, the U.S. reputation on the global climate stage will be severely affected. Read more here. . . .

. . . . A draft proposal of the European Union and the U.S. agreement to spend $100 billion helping smaller and poorer nations fight global warming they did not contribute to looks to fall short of what will actually be needed to wean many of them off the allure of fossil fuels. Read more here. . . .

. . . . The largest U.S. supermarkets have cut their food waste in half in recent years with creative distribution programs, and finding ways to generate extra profits from it in the meantime. That bodes well for a nation which throws out 40% of its food. Read more here. . . .


Editor’s picks: Lordstown Motors running out of money, HSBC shareholders support phasing out coal financing


Lordstown Motors warns it may fail

Startup Lordstown Motors (RIDE), says it’s running out of money and may go out of business in the coming year. The electric truck maker’s stock was down as much as 20% on Wednesday before recovering some of those losses in afternoon trade. The company says it does not have enough money to begin commercial production and warned there is “substantial doubt” about its ability to stay in business. In a Securities and Exchange Commission filing, Lordstown said it had $259.7 million in cash on hand as of March 31, after posting a net loss of $125.2 million in the first quarter. The company is seeking more investment.

HSBC shareholders support phasing out coal financing

HSBC (HSBC) shareholders have overwhelmingly approved the bank's plans to phase out financing for the coal industry in developed nations by the end of the decade and by 2040 worldwide, following growing pressure for more ambitious climate action, Cecilia Keating reports for GreenBiz. The report cites preliminary results from the HSBC annual general meeting showing more than 99% of the bank's shareholders voted in favor of the climate resolution, which was tabled by the HSBC board and commits the bank to implementing a strategy for transitioning to a net zero financial portfolio by 2050.

Canada launches $500 million salmon rescue

Canada has launched a new program valued at $535 million to help restore Pacific wild salmon stocks at risk of collapse due to climate change, habitat loss and harvesting pressures, Reuters reports. According to the report, the investment will be the largest ever government contribution to efforts to save the fish, which are of major cultural and ecological significance on the west coast.

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This week in wildfires: Arizona hotspots

. . . . Fire season is heating up. As of June 9, the Fire Information for Resource Management System reported four new large incidents in the U.S. and Canada, four large fires contained, and 14 large fires uncontained. In the southwest, six uncontained large fires were reported, and the Telegraph and Mescal Fires east of Phoenix have been active, with each growing between 10,000 and 14,000 acres in 24 hours, Wildfire Today reports. Across the nation, the National Interagency Coordination Center reports as of Wednesday morning, more than 276,925 acres had burned. . . .


Data driven: Farming in water

. . . . Aquaculture is breeding, raising, and harvesting fish, shellfish, and aquatic plants. Basically, says the National Oceanic and Atmospheric Administration, it’s farming in water. U.S. aquaculture is an environmentally responsible source of food and commercial products, helps to create healthier habitats, and is used to rebuild stocks of threatened or endangered species. NOAA says in the U.S., marine aquaculture produces numerous species including oysters, clams, mussels, shrimp, seaweeds, and fish such as salmon, black sea bass, sablefish, yellowtail, and pompano. The United States produced $1.5 billion worth of aquaculture seafood in 2018. The top U.S. marine aquaculture species were oysters ($219 million), clams ($122 million), and Atlantic salmon ($66 million). Not only is June National Ocean month, NOAA’s Fisheries Science Center this year is celebrating 150 years of science, service and stewardship of our nation’s marine life and their habitats.