In today’s edition:

🚗 US EV Tax Credit

🏔️ UK Trade deals impact on Agriculture

🛰️ Startups cleaning up the carbon markets

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💼 Big Business (1-minute read)

All eyes on the US electric-vehicle tax credits

The Biden administration released long-delayed guidance on electric-vehicle tax credits. The landmark Inflation Reduction Act included a $7,500 consumer tax credit to increase EV adoption while boosting domestic manufacturing. An EV that qualifies for the full tax credit must source at least 40% of the value of its ‘newly negotiated critical minerals’ from the US or countries with US free trade agreements. At least half of the value of battery components must be manufactured in North America = Many current US car manufacturers cut out of the deal.

Challenge: It’s a tough task considering the US has virtually no mining capacity for critical minerals such as lithium and cobalt. The exclusion of allies that lack free trade agreements such as the EU (One was signed with Japan last week) also soured trade relations.

UK trade deal risks supporting “destructive agriculture”

The UK government have announced plans to join a trading bloc with 11 nations across the Indo-Pacific region. The deal paves the way for more trading with countries like Australia and Mexico, with trading of food and drink being its primary purpose. Ministers claim the deal will generate £1.8bn extra income for the UK.

Criticism: Green groups have criticised the plans, stating that joining the bloc encourages more food imports produced in ways that drive deforestation, use harmful pesticides or rely on unregulated fishing.

Our take: Definitive impacts of the deal on food standards and the environment are unclear, but it will be interesting to see how UK food processors and retailers confront this uncertainty with longer/more complex supply chains as they push to reduce scope three emissions.

Electric Moto-Taxi aims to clear the air in Ugandan Capital

Spiro, an e-bike and battery-swapping provider, has signed an agreement with the Ugandan government expected to spur the replacement of 140,000 emission-spewing motorbike taxis (which are the main form of last-mile transportation in many African cities) with electric alternatives. The planned number of e-bikes would account for nearly 90% of Kampala’s registered taxis (boa-bodas) and over a third of the country’s official fleet.

💡 Start-Up Spotlight (1-minute read)

Sylvera

One liner: Sylvera develops machine learning-based tools that analyse visual data — for instance, satellite imagery — to boost the accountability and credibility of carbon offsets

Problem space: A market worth $50Bn by 2030 is being held back by a lack of data throughout the entire value chain. It’s a debt market without credit ratings.

Deep Dive: Sylvera is a carbon intelligence company that helps buyers evaluate and invest in high-quality carbon credits. Companies with net zero targets rely on Sylvera’s carbon credit ratings to ensure that the offsets they purchase are legitimate and impactful. Sylvera do this using uses machine learning technology to analyse a variety of visual data like satellite imagery and lidar on projects generating carbon credits to validate them.Think of a Moody’s rating for bonds but for carbon credits. The rating system gives market participants confidence to transact and deploy capital. The aim is to quantify a project’s carbon performance (Accuracy of reported carbon avoidance or removal), additionality (If emissions reductions would not have occurred without revenue from sale of carbon credits) and permanence (how long the carbon dioxide removed or avoided will be kept out of the atmosphere.), as well as co-benefits the project brings to local communities and the environment

Impact:

• Confidence: Help investors pick the best carbon credits, which means they don’t waste money on bad investments or put your reputation at risk.

• Choice: Provide a view of the whole market without conflict of interest of selling their own credits. They help customers determine the most cost-effective way to buy — whether it’s direct to project developer, via broker or exchange.

• Efficiency: Save time and money spent on due diligence, enabling companies to move quickly with a lean team.

Location: UK

Latest Funding: Series A - $32 Mn

Partners: The World Bank, UCL, University of Edinburgh, Jet Propulsion Laboratory

Founders: Samuel Gill, Allister Furey

💰 Deals of the Week (1-minute read)

• 🔋 A Wisconsin-based startup called Type One Energy closed an oversubscribed $29 million financing round to launch its effort to commercialize a weird kind of nuclear fusion device known as a stellarator.

• 🧃 German package recycling platform start-up Recyda has raised €1.75 million for its software designed to help companies along the packaging value chain assess the recyclability of their packaging with software and data.

• 🖥️ Good Chemistry (Canada) raised $6.7Mn in seed for its quantum computing and machine learning to simulate carbon-reducing materials properties at scale and accuracy before they are synthesized in the lab

• 🛰️ Agreena raised $81.3Mn in Series B for its soil carbon certification program for farmers that provides technical and financial solutions to transition to regenerative agriculture.

💭 Little Bytes

Quote: “Not everybody consistently meets all [criteria for best practice] . . . Everybody is going to have to step up,” said Annette Nazareth, chair of the The Integrity Council for the Voluntary Carbon Market — The independent task force planning to police the carbon credit market

Stat: Only 5% of FTSE100 companies have “credible” climate transition plans — EY

Watch: Egyptian start-up turning plastic bags into paving tiles

🗞 In other news…

• Japan's carbon pricing scheme being launched in April. Japan believes the scheme, which combines emissions trading and a carbon levy, will help to turn the world's third-largest economy greener while maintaining the global competitiveness of its industries.

• A group of more than 2,000 Swiss women launch landmark lawsuit in Europe claiming weak climate action breaches their human rights

• Analysis from Australia states that Lithium exports will match those from thermal coal by 2028, with the battery metal set to become the nation’s fifth biggest commodity, with iron ore, coal and gas earning set to plunge.

• Microsoft pushing to use the last of its Climate Fund to dovetail investments into tech tackling carbon emissions with spending targeted by the Inflation Reduction Act.

🎣 Gone Phishing

Three of these stories are true. Guess which one we've made up...

• Well-preserved Ice Age squirrel to go on display

• Rock crystal sits in museum for 200 years, before experts realise it’s not a rock

• Moving Pablo Escobar’s hippos to cost Colombia $3.5mn

• Cheese-themed spa opens in Cheddar, England

Written by Colin and Ollie - Drop us a message!