Equilibrium/Sustainability — Presented by NextEra Energy — Florida city proposes underground transit for era of rising seas

Today is Wednesday.  Welcome to Equilibrium, a newsletter that tracks the growing global battle over the future of sustainability. Subscribe here: digital-staging.thehill.com/newsletter-signup. 

Ft. Lauderdale, Fla., Mayor Dean Trantalis announced Tuesday night that his city had accepted Elon Musk’s proposal “to build an underground transit system between downtown and the beach” — calling the plans “a truly innovative way to reduce traffic congestion.”

But Musk has only completed one such project thus far — a Las Vegas loop that lacked the speedy autonomous vehicles Musk had promised and instead featured what Gizmodo’s Matt Novak described as “humans driving slowly in a tunnel.”

While “every coastal city in the world” is building up to adapt to rising sea levels, Florida is instead doing “the literal opposite,” wrote Samantha Montano of the Massachusetts Maritime Academy.

And journalist Brian Kahn added that unlike Vegas, Ft. Lauderdale sits on “the equivalent of geological Swiss cheese and much of it could be underwater by 2100.”

Much of Florida was in fact underwater as recently as Wednesday, as Tropical Storm Elsa made landfall, prompting flood and tornado warnings across the north-central region. Nine people were missing after a vessel capsized off Key West on Tuesday, NBC reported, while storms complicated the ongoing search for victims of the Surfside, Fla., condo collapse, according to The Associated Press.

But today we’ll be looking at another kind of storm — the repeat ransomware attacks from Russian hackers on U.S. infrastructure. And turning to solutions that might sustain, rather than shatter, our future, we’ll explore why Exxon Mobil is hedging its bets on biofuels and the role carbon majors will play in the green economy transition.

For Equilibrium, we are Saul Elbein and Sharon Udasin. Please send tips or comments to Saul at selbein@digital-staging.thehill.com or Sharon at sudasin@digital-staging.thehill.com. Follow us on Twitter: @saul_elbein and @sharonudasin. 

Let’s get to it.

A MESSAGE FROM NEXTERA ENERGY

As the world’s largest producer of wind and solar energy, NextEra Energy is pioneering innovation on green hydrogen – the solution for deep decarbonization of hard-to-abate sectors. See how at NextEraEnergy.com.

Pressure mounts on Biden amid ransomware attacks

President Biden is under increasing pressure to respond to Russian-based cyberattacks that have been threatening national infrastructure and business operations for several months. 

Over the Fourth of July weekend alone, officials believe that Russian-based criminals called REvil hacked into computers at between 800 and 1,500 firms, through a vulnerability in IT company Kaseya’s network management system, Gerrit De Vynck, Aaron Gregg and Rachel Lerman reported for The Washington Post. 

How bad was the hack? It’s hard to say. Kaseya CEO Fred Voccola said that the company shut down the software that let REvil in within an hour of noticing the issue. But Kaseya sells its product to thousands of IT providers, who in turn serve thousands of clients, according to the Post.

With so many systems, without knowing how long attackers were inside, and with the addition of the holiday weekend, the extent of the damage remained unclear. 

As of Wednesday, REvil was still demanding $70 million to release the files. Although Biden said Saturday that “the initial thinking” was that the Russian government per se was not involved, cybersecurity reporter Joseph Marks argued in the Post that “such a widespread attack over a holiday weekend is raising the stakes for the administration to either win some public concessions from Russia quickly or punch back hard.”

“Crippling,” but not Colonial scale: The REvil attack “could be crippling” to businesses by “wiping out all of their files.” But it seemed to wreak less havoc than the May ransomware strike on the Colonial Pipeline, which prompted panic buying of fuel along the East Coast, the Post reported.  

WHAT’S RUSSIA GOT TO DO WITH IT

“Off limits”: When Biden met with Russian President Vladimir Putin at a summit in Geneva in June, he called for an immediate halt to the recent string of ransomware strikes. 

Biden told reporters that he presented the Russian leader with a list of 16 critical infrastructure sectors that “should be off limits to attack period,” Christian Vasquez reported for E&E News. U.S. intelligence officials believe that most successful ransomware operatives hitting American targets are headquartered in Russia, where they are given free rein to launch attacks as long as they don’t harm Russia or its allies, according to E&E.

“I looked at [Putin] and I said, ‘How would you feel if ransomware took on the pipelines from your oil fields?'” Biden said. “He said it would matter. This is not about just our self-interest. This is about our mutual self-interest.”

U.S. integrity at stake: With this latest attack coming so soon after Biden met with Putin in Geneva — and targeting the IT sector, one of the 16 criticals — expert Dmitri Alperovitch told the Post’s Marks that the “administration’s credibility is on the line about not tolerating these attacks.” Alperovitch, chairman of the Silverado Policy Accelerator, added that “events are forcing their hand.”

Around the same time as the REvil attack, a Russian government hacking group also breached Synnex, a third-party provider to the Republican National Committee, Bloomberg reported. These hackers, according to the Post, belong to the same Russian intelligence bureau that attacked many U.S. agencies in 2019-2020, through the software firm SolarWinds.

“Biden did a good job laying down a marker, but when you’re a thug, the first thing you do is test that red line,” James A. Lewis, of the Center for Strategic and International Studies, told The New York Times. “And that’s what we’re seeing here.”

If the Biden administration does determine that attacks have crossed this “red line,” any action in response would undoubtedly come after the U.S. government attributes it to a specific actor or group of actors.   

Takeaway: Regardless of the Russian government’s involvement, the threat of cyberattacks to America’s critical infrastructure and businesses remains. Biden’s next steps will be critical, and experts are waiting to see what those next steps might be.

“Now, he has an opportunity to set the future tone by delivering a quiet but clear ultimatum and, if necessary, follow through on it,” Alperovitch wrote in a column for the Post, with colleague Matthew Rojansky. “If this opportunity to draw a bright line is missed, these attacks risk becoming Russia’s asymmetric weapon of choice against the United States.”

A MESSAGE FROM NEXTERA ENERGY

We’re pioneering innovation on green hydrogen – the solution for deep decarbonization of hard-to-abate sectors. See how it can create jobs, accelerate economic growth and more at NextEraEnergy.com.

Exxon pushes investments in algae but faces skeptical investors

 

Exxon Mobil is the last of the oil majors pushing to make fuel — or at least good public relations — out of algae. But with shareholders and regulators newly critical of fossil fuel investments, they may be drilling a dry well.

First steps: Algae is not a single species but a way of life that encompasses millions of species of small green things — from kelp to cyanobacteria — that float in the water column, binding carbon from the atmosphere into the biomass that forms their bodies.

That’s the same reaction — plus heat, pressure and millions of years — that once created oil. So between 2009-2017, oil majors like Shell, Exxon Mobil and Chevron tried to make oil from algae grown in labs and open tanks, Carly Nairn reported for Mongabay. Now, only Exxon Mobil is left.

Is that more sustainable than oil? Biofuels are renewable, unlike conventional oil. And algae grows in water, allowing the possibility of avoiding competition with food crops or forests.

But like all other forms of biofuel, if you burn algal biofuel, it releases carbon into the atmosphere. The pitch for biofuels is that they will be a closed loop, absorbing back as much carbon as they burn.

Yet that proposition can be hard to track. In the case of forest biomass products like wood pellets and palm oil, their use has led to deforestation. in the case of carbon offsets — in which polluters pay a third party to (theoretically) store the carbon they have released — a measure intended to suck up emissions has in fact added millions of tons of additional carbon dioxide, as Lisa Song and James Temple reported for ProPublica.

For Shell and Chevron, who Nairn notes have closed their algae units, the problem was economic: It takes far more energy to produce a given unit of algal biofuel than the energy that this fuel contains.

Exxon Mobil soldiers on: But Exxon Mobil, meanwhile, says it has spliced new strains of algae that will allow it to produce 10,000 barrels of algal oil daily by 2025 — about 0.25 percent of its current daily output of oil and gas.

The value of that production was less practical than political, Zoya Teirstein of Grist told the Harvard Political Review in 2020. Though Exxon Mobil’s social media was covered in pictures of algae, “when you call their offices there’s no algae unit … [T]heir major product is still oil.”

‘WARM WORDS ARE NOT ENOUGH’

A capital drought for climate holdouts? This cavalier attitude toward its transition from fossil fuels led activist investor Engine No. 1 — and the institutional investors that supported it — to a surprise vote that placed three new climate-conscious members on the Exxon Mobil board at its May annual general meeting, as Jessica Camille Aguirre wrote in June for The New York Times Magazine.

That’s the sort of move that could become more common. A group of investors representing $4.2 trillion in assets wrote to some of the world’s biggest banks, saying that “distant net zero targets and warm words about the importance of biodiversity are not enough,” organizer Jeanne Martin told Alastair Marsh of Bloomberg Green.

Banks that failed to offer concrete action could expect “serious challenges” at their annual general meetings, Martin said.

That letter is one sign that banks are under increasing pressure not to lend to companies seen as climate delinquents, which is “starting to starve the supply of capital to the conventional energy space,” Dave Lowery, a researcher at Preqin, told Benjamin Robertson and Melissa Karsh of Bloomberg.

Takeaway: In addition to that new scrutiny from investors, there’s the prospect that the Securities and Exchange Commission will make companies like Exxon Mobil start disclosing the risks that both climate change and the transition off fossil fuels pose to their business. If so, the company is going to have to start pitching investors more persuasive and detailed long-term plans than simply pictures of algae.

One answer that interests some fossil fuel companies: hydrogen fuel, which could work for the same industrial sectors as algae biofuel.

In the coming days, we’ll use the hydrogen question to look at the future of the oil majors in a world transitioning off oil — and how investors and regulators can know that the solutions they propose aren’t simple greenwashing.

ROUND-UP

Wednesdays around the world

The UAE wants to pump oil now to fund renewables later

• The United Arab Emirates wants to pump more oil now to fund their transition from the fossil fuel while the commodity is still worth something, The Wall Street Journal reported Wednesday.
• Paradoxically, that means the prospect of decarbonization will in the short-term drive more emissions, Robinson Meyer wrote Tuesday for The Atlantic. 
• It’s also a sign that “oil companies and oil-producing states are both planning for the energy transition and trying to shape the terms under which it happens,” Meyer wrote.
• News of the UAE’s move comes after a spat with Saudi Arabia over OPEC production levels, as we reported in Tuesday’s Equilibrium.
   

Sámi people of Northern Sweden protest geoengineering venture to cool the Earth

• The Sámi people, an Indigenous group native to the Arctic Circle, protested a Harvard research project to test a technology for climate mitigation in their Northern Sweden homeland of Sápmi, Haley Dunleavy reported for Inside Climate News.
• The project, known as “solar geoengineering,” aimed to reduce global warming by releasing reflective particles into the stratosphere, minimizing the amount of sunlight hitting the Earth’s surface, Dunleavy explained.
• “This goes against our worldview that we as humans should live and adapt to nature,” said Åsa Larsson Blind, vice president of the Saami Council, a nongovernmental organization that represents Sámi people from across their homelands. 
• The project, originally scheduled for June, has since been suspended, according to Inside Climate.

{mosads}The Hill is hosting a few events relevant to the sustainability conversation, so please mark these events on your calendar.

On Tuesday, the panel “Small Business Recovery Tour: Minneapolis” will look at opportunities to help minority-owned businesses recover from the pandemic. Then on July 15, a panel titled  “Revitalizing America’s Cities” will explore how we can rebuild cities in a more inclusive and resilient manner. 

Please visit The Hill’s Equilibrium section online to read more. We’ll see you on Thursday evening.