Green

The Circular Economy: Redesigning our Planet’s Future

Published

3 years ago

October 8, 2019

Ashley Viens

Think about the last item you threw away. Did you consider where that product ended up, once you threw it away?

The Earth’s growing waste problem can be traced back to a culture that treats virtually every item we buy and own as disposable. Rapid urbanisation, population growth, and industrialisation are key contributors to the burgeoning volumes of waste that humans are producing each year.

But what if there was away to get around that?

Introducing the Circular Economy

Today’s post from BlackRock highlights the key benefits of adopting a circular economy, and examines the factors that will make the biggest impact in the years to come.

Circular Economy

A Culture of Consumption

Mass production is making products cheaper, more readily available, and more readily disposable, bringing levels of material comfort unimaginable to previous generations.

Companies are making new products at a frenetic pace to keep up with global demand─consuming finite resources as if the Earth had an infinite supply.

The intense effects of this mass consumption are visible across multiple industries:

Construction: Construction waste alone is expected to reach 2.2 billion tonnes annually by 2025.
Fast Fashion: Roughly 87% of clothing is discarded or burned each year, costing US$100 billion.
Plastics: Over 95% of plastic packaging value is wasted every year, costing up to US$120 billion.

As natural resources decline and waste continues to pile up, our society is at a crossroads.

A Tale of Two Economies

Today, most of the world follows the Take-Make-Waste practices of the linear economy, with little regard for future use of these resources and products. Unfortunately, most of this ends up in landfills─by 2050, we could be producing 3.4 billion tonnes of waste each year.

The circular economy, by contrast, is focused on redesigning our systems, processes, and products to enable goods to be used longer, repurposed, or recycled more efficiently.

The circular economy is a major transformational force that will last decades…investors are increasingly considering sustainability factors when making investment decisions.

—BlackRock

Companies and governments that choose to adopt a circular economic model could end up saving €600 billion (US$663 billion) annually─and potentially add €1.8 trillion (US$2 trillion) in additional benefits to Europe’s overall economy.

Designing a Better Future

Three major factors are driving the gradual, global shift to a circular economy.

Economic
Companies will need to switch from wasteful to sustainable practices, and many are taking steps towards a better future. The New Plastics Economy Global Commitment was signed in 2018 by over 400 organisations to eliminate plastic waste and pollution.
Regulatory
Regulations such as bans on single-use plastics and international waste imports are growing more stringent, and some governments are also offering tax incentives for corporations that follow sustainable practices.
Society
More consumers are actively researching and questioning the impacts of the products they buy, and consumer demand is showing a preference for reusable products and practices.

While few public companies today are actively using a circular economy, several major brands are leading the way in sustainable business practices.

Philips: Light-as-a-service that provides access to lighting rather than ownership of lightbulbs
Levi Strauss: Repurposing old garments into building insulation, upholstery, and new clothing
Toshiba: First multi-function printer, heat-sensitive erasable toner can do up to five reprints per page
Renault: Revamped old vehicle drive trains, engines, and gearboxes to almost-new condition

Companies and governments in the circular economy have a structural advantage to solve some of the world’s biggest economic issues ─ giving them a strong, long-term market for goods and services, the potential to lower costs, and open profitable new business streams.

Lasting Impact on People, Planet, and Profit

In order for the circular economic model to achieve widespread adoption, both sustainable investment and partnerships across sectors are needed.

This rally for change is making an impact on financial markets─sustainable investments around the world grew from US$13.3 trillion in 2012 to US$30.7 trillion in 2018.

Healthy economies rely on a healthy environment, and building a circular economy is integral to the future health of our economy, planet, and society.

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Environment

Animation: Visualizing 140 Years of Global Surface Temperatures

Here’s a look at 140 years of global surface temperatures, highlighting the ten coldest and warmest years since 1880.

Creator Program

Published

6 days ago

September 23, 2022

Carmen Ang

Average surface temperatures since 1800

Animated: 140 Years of Global Surface Temperatures

For hundreds of years, Earth’s average surface temperature has been steadily increasing. And over the last decade, this global heating appears to have intensified.

Since 1880, the global average temperature has risen by an average of 0.08°C (0.14°F) every 10 years, according to the National Oceanic and Atmospheric Administration (NOAA).

But since 1981, warming has been occurring at more than twice that rate, by about 0.18°C (0.32°F) per decade.

This graphic by Pablo Alvarez shows 140 years of global surface temperatures, highlighting the 10 coldest and warmest years from 1880-2021 using data from NOAA.

Global Surface Temperatures Over Time

Over the last century and a half, there have been fluctuations in global surface temperatures, with some of the coolest years on record occurring in the late 19th century and early 20th century.

Average surface temperature since 1800

However, the last two decades have seen unprecedented warming, with the 10 warmest years on record all occurring within the last 20 years. Here’s a look at the 10 hottest years since 1800, and how they compared to the 20th century average:

The 10 Warmest Years

Rank	Year	Deviation from 20th Century Avg. (°C)
#1	2016	+0.99
#2	2020	+0.97
#3	2019	+0.94
#4	2015	+0.93
#5	2017	+0.9
#6	2018	+0.82
#7	2014	+0.74
#8	2010	+0.72
#9	2013	+0.67
#10	2005	+0.66

As of this article’s publication, the warmest year on record was 2016, when temperatures were +0.99°C (1.78°F) above the 20th century average. After 2016, the second warmest year was 2020, when surface temperatures reached +0.97°C (1.75°F) higher than the previous century’s average.

What Factors Impact Earth’s Climate?

There are a number of natural factors that influence global surface temperatures, including phenomena such as:

Volcanic activity
Changes in the Earth’s orbit
Shifts in ocean currents

However, scientists believe that our current rate of warming has been undoubtedly caused by human influence, especially because of our carbon and other greenhouse gas (GHG) emissions.

According to the most recent report by the Intergovernmental Panel on Climate Change (IPCC), “observed increases in well-mixed greenhouse gas (GHG) concentrations since around 1750 are unequivocally caused by human activities.”

In other words, while Earth’s surface temperature naturally fluctuates over the years, our actions have undoubtedly contributed to recent changes in Earth’s climate.

What Are The Consequences?

We’re already seeing the impact of this warming, as the world struggles with extreme climate events like droughts, heatwaves, floods, and an influx of wildfires in places like Europe, the United States, and Australia.

These extreme weather patterns could become the new normal if left unchecked, which is why companies and policymakers around the world are embarking on different solutions—from targeting net zero goals to implementing technological innovations that could reduce emissions.

Energy

The U.S. Utilities Decarbonization Index

This graphic quantifies and compares the state of decarbonization among the 30 largest investor-owned utilities in the United States.

Written By

Govind Bhutada

Graphics & Design

Miranda Smith

Published September 20, 2022 • Updated September 21, 2022 •

Introducing the NPUC Annual Utility Decarbonization Report 2022
Created in partnership by Visual Capitalist and Motive Power.

Download the Free Report

The U.S. Utilities Decarbonization Index

With the Biden administration targeting a zero-emissions power sector for the U.S. by 2035, how are the nation’s largest electric power providers faring in terms of decarbonization?

Together, Visual Capitalist and our sponsor National Public Utilities Council have developed the Annual Utility Decarbonization Index. The index quantifies and compares the status of decarbonization among the 30 largest investor-owned utilities in the United States.

Decarbonization is quantified by scoring companies on six emissions-related metrics based on publicly available data from 2020 (the latest available).

Why the 30 Largest IOUs?

Why does the Decarbonization Index specifically look at the 30 largest IOUs by electricity generation?

Well, these 30 utilities collectively generated around 2.3 billion megawatt hours (MWh) of electricity (including purchased power), making up over half of U.S. net electricity generation in 2020. Moreover, they also served over 90 million customers, accounting for roughly 56% of all electric customers in the country.

Therefore, it’s safe to say that the 30 largest IOUs have an important role in decarbonizing both the power sector and the U.S. economy. Since the residential, commercial, industrial, and agricultural sectors all use electricity, the decarbonization of utilities—the providers of electric power—can enable emissions reduction throughout the economy.

Decarbonization Index Methodology

For each of the six metrics used in the Decarbonization Index, utilities are scored on a scale of 1 (lowest) to 5 (highest), indicating whether they are trailing or leading, respectively. Scores for each metric are based on the range of figures for each metric divided into five equal buckets that the utilities fall into.

For simplicity, let’s suppose that the lowest reported total emissions figure is zero metric tons of carbon dioxide (CO₂) and the highest is 100 metric tons. In that case, companies that emit fewer than 20 metric tons of CO₂ will receive the highest score of 5. Those that emit between 20 and 40 metric tons of CO₂ will receive a 4, and so on.

A utility’s overall decarbonization score is an average of their scores across the six metrics, summarized below:

Fuel Mix:
The share of low-carbon sources (renewables, nuclear, and fuel cells) in the utility’s owned net electricity generation. We’ve assumed that the share of low-carbon sources can range from 0% to 100%, and scores are assigned based on that range.
CO₂ Emissions Intensity:
The amount of CO₂ emitted per megawatt-hour of owned and purchased electricity generation.
Total CO₂ Emissions:
The sum of absolute CO₂ emissions from owned and purchased electricity generation. While this overlooks the differing sizes of utilities, the rationale is that smaller unconsolidated utilities may find it easier to decarbonize than larger peers.
CO₂ Emissions per Capita:
The amount of CO₂ emitted from owned and purchased electricity generation per retail customer served in 2020.
Decarbonization Goals:
An evaluation of the utility’s interim greenhouse gas (GHG) emissions reduction goals and net-zero targets. The baseline for this is 50% GHG emissions reduction by 2030 and net-zero emissions by 2050 (utilities with baseline targets get a score of 2.5/5).
Low-Carbon Investment:
The share of planned capital expenditure (CAPEX) for electricity generation that is allocated to low-carbon sources. We’ve assumed that the share of CAPEX for low-carbon sources can range from 0% to 100%, and scores are assigned based on that range.

The data for these metrics comes from various sources including company sustainability reports, quantitative reporting templates from the Edison Electric Institute, and the Climate Disclosure Project’s Climate Change Questionnaire filings.

Explore all six metrics of the U.S. Utility Decarbonization Index

Download The NPUC Annual Utility Decarbonization Report for free.

The Annual Utility Decarbonization Index 2022

Before looking at numbers, it’s important to note that the Decarbonization Index is relative and compares the 30 largest IOUs to each other. Therefore, a score of 5 does not indicate full decarbonization or net-zero emissions. Instead, it suggests that the utility is doing particularly well relative to its peers.

With that in mind, here’s a look at the Annual Utility Decarbonization Index 2022:

Rank	Company	Decarbonization Score
#1	Public Service Enterprise Group	4.7
#2	NextEra Energy Resources	4.7
#3	Pacific Gas and Electric	4.5
#4	Avangrid	4.2
#5	Exelon	4.1
#6	Portland General Electric	3.7
#7	Dominion Energy	3.6
#8	Florida Power and Light	3.6
#9	PNM Resources	3.5
#10	Alliant Energy	3.4
#11	Consolidated Edison	3.4
#12	Fortis Inc.	3.4
#13	American Electric Power	3.3
#14	Consumers Energy	3.3
#15	Evergy	3.0
#16	NRG Energy	3.0
#17	AES Corporation	2.9
#18	Xcel Energy	2.9
#19	WEC Energy	2.9
#20	DTE Energy	2.8
#21	Duke Energy	2.8
#22	Entergy	2.8
#23	TransAlta	2.8
#24	Emera	2.7
#25	Ameren	2.6
#26	Berkshire Hathaway Energy	2.5
#27	Oklahoma Gas & Electric Company	2.4
#28	Southern Company	2.3
#29	PPL Corporation	2.2
#30	Vistra Corp.	2.0

A small number of companies did not report data on certain metrics and have been excluded from scoring for those metrics (denoted as N/A). In such cases, the decarbonization score is an average of five metrics instead of six.

Public Service Enterprise Group (PSEG), headquartered in New Jersey, tops this year’s rankings thanks to its low-emissions profile and ambitious climate goals. The company is aiming to achieve net-zero emissions from operations by 2030—five years ahead of the Biden Administration’s target and faster than any other utility on the list.

Tied with PSEG is NextEra Energy Resources, the clean energy-focused subsidiary of NextEra Energy. The company is the world’s largest producer of solar and wind power and generated 97% of its net electricity from low-carbon sources in 2020.

In third place is California’s largest utility, the Pacific Gas and Electric Company (PG&E). PG&E had the lowest emissions per capita of the 30 largest IOUs at 0.5 metric tons of CO₂ per retail customer in 2020. That figure is significantly lower than the average of 11.5 metric tons across the 30 IOUs.

Rounding out the top five are Avangrid, a renewables-focused U.S. subsidiary of the Spanish Iberdrola Group, and Exelon, the nation’s largest utility by number of retail customers. Avangrid had one of the cleanest fuel mixes with 87% of its owned net electricity coming from low-carbon sources. Exelon is the nation’s largest provider of emissions-free electricity, generating around 157 million MWh or 86% of its owned net electricity from nuclear power.

Download the Full Utility Decarbonization Report

While the Decarbonization Index provides a look at the current status of utility decarbonization, there’s much more to uncover in the full report, including:

The obstacles that utilities face on the path to decarbonization
The detailed data behind the six individual metrics
The U.S. utilities ESG report card
The solutions and strategies that can help accelerate decarbonization

>> Click here to download the full report and find out everything you need to know about utility decarbonization.

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