Economy

New Amazon CEO's first test - boost ESG ratings

By David Callaway, Callaway Climate Insights

Andy Jassy won’t have to look far to see climate change from his new perch as chief executive at Amazon (AMZN). It’s right outside his Seattle office, where temperatures hit a record 104°F. degrees last week as part of the deadly heat dome phenomenon.

As he takes the reins from founder Jeff Bezos this week, climate activists and environmental, social and governance (ESG) investors will be watching closely for clues about whether he holds Bezos’ commitment to investing in renewable energy.

Amazon appears in many ESG funds, but has a mixed record, mostly by virtue of its size. While it is on track to meet its promise to power itself entirely by renewables by 2025 — including its massive truck fleets and AWS cloud computing division — its footprint still holds others back from including it in their holdings.

Amazon shares, which are up more than 11% this year, were not included in the Investors Business Daily list of 50 best ESG companies last month.

Jassy, who launched AWS and turned it into one of the company’s most powerful businesses, has been criticized for pursuing fossil fuel contracts at a time when others are pulling away from the business. One of the metrics investors will measure Jassy’s performance by is how he manages the company’s Climate Pledge Fund, which just made a major investment in India last week.

I remember being among the bears on Apple (AAPL) shares when Tim Cook became CEO a decade ago, so I have learned the hard way that anything can happen when a long-time executive takes the reins from a charismatic founder. The Jassy era’s success will be in a large way marked by his commitment to fighting global warming. The climate clock in Seattle is already ticking.

More insights below. . . .

Tuesday’s subscriber insights: Ørsted chief targets U.S. permitting process for lagging on offshore wind

. . . . Danish wind energy giant Ørsted’s chief said bureaucratic U.S. permitting processes will prevent the country from reaching its 2030 wind capacity goals, laying out a new challenge to the Biden administration as it seeks to convert America to renewable energy. Read more here. . . .

. . . . The discovery of ESG investments by the cash-heavy private equity industry heralds a tipping point in green investing in which more funds will start chasing few deals, pushing up competition and helping speed the transfer of hot money from fossil fuels. Read more here. . . .

Editor’s picks: Conviction for death of Honduran activist, Tennessee pipeline halted, new energy jobs forecast

‘Mastermind’ convicted in killing of Honduran environmental activist

A Honduran man on Monday was convicted of homicide in the 2016 killing of Berta Cáceres, a prize-winning environmental and Indigenous rights defender. ABC News reports that Roberto David Castillo Mejía was found guilty of participating in the killing of Cáceres, a member of the Lenca Indigenous group who led opposition to a dam project in which Castillo Mejía was involved. In December 2019, seven men were sentenced to prison for Cáceres’ murder. Prosecutors said the killers acted on behalf of a company, Desa, that was building a dam being opposed by the activist. Castillo Mejía, who heads the project, was arrested in 2018. Cáceres was a co-founder of the National Council of Popular and Indigenous Organizations of Honduras. She helped organize opposition to the Agua Zarca dam project, which reportedly has been halted.

Controversial Tennessee oil pipeline halted

Environmentalists and activists claimed victory Saturday after a company canceled plans to build an oil pipeline through southwest Tennessee and north Mississippi, and over an aquifer that provides drinking water to a million people, the Associated Press reports. Byhalia Connection said it will no longer pursue plans to build a 49-mile underground pipeline that would have linked two major U.S. oil pipelines while running through wetlands and under poor, predominantly Black neighborhoods in south Memphis, the AP said. In a Securities and Exchange Commission filing Friday, Byhalia Connection said it was canceling the project, a joint venture between Valero and Plains All American Pipeline, “due to lower U.S. oil production resulting from the COVID-19 pandemic.”

IRENA: Path to 1.5°C. could create 122 million new energy jobs by 2050

Accelerating energy transitions on a path to climate safety can grow the world’s economy by 2.4% over the expected growth of current plans within the next decade, a new analysis from the International Renewable Energy Agency (IRENA) shows. The Agency’s 1.5°C. pathway foresees the creation of up to 122 million energy-related jobs in 2050, more than double today’s 58 million. Renewable energy alone will account for more than a third of all energy jobs employing 43 million people globally, supporting the post-COVID recovery and long-term economic growth. IRENA’s World Energy Transitions Outlook says the annual investment of $4.4 trillion needed on average is high. But it is feasible and equal to around 5% of global GDP in 2019, the report says.

This week in wildfires

. . . . As of July 5, the Fire Information for Resource Management System reported nine new large incidents in the U.S. and Canada, four large fires contained, and 36 large fires uncontained. Active areas included Northern California, where 26 new fires were reported, and five uncontained large fires. In the Northern Rockies area, 32 new fires were reported and there were five uncontained large fires. Across the nation, the National Interagency Coordination Center reports as of Wednesday morning, more than 781,459 acres had burned. . . .

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