It's tearin' up my heart (part 1)
Things to think about when "climate" meets geopolitical realities?
Welcome back! And welcome to the 60 new subscribers since the last edition. Magnifique.
It’s been awhile since I’ve written here - time with family, midsummer, the transfer deadline and life in general has had to come first. As a writer, I’m finding it increasingly key to focus on finding the balance of what will be interesting for you, the reader, as well as for me. Last time, I mentioned I’d tack back to a more geopolitical bent thanks to your feedback, and I’m in the mood for it this month. Thank you for your continued support.
Before we start…
Announcements
I went on the My Climate Journey podcast to talk climate security and its touchpoints with geopolitics and climate tech a few weeks ago. The time flew by, so I must have been having some kind of fun - thanks again Cody Simms and the MCJ team for the opportunity to platform climate security to a broader audience, including to the climate tech / climate VC and PE communities. If you’ve found this newsletter via the podcast, welcome and would be interested in how you feel these topics connect with what is top of mind for you and what you’re executing on.
And I’m also very pleased to be joining the advisory board of the Center for Climate and Security, a US think-tank doing great work raising public understanding of the nexus between climate change impacts, security, resilience and government policy. I’m looking forward to the future dialogue and activities with Erin Sikorsky, Tom Ellison and the CCS team.
Security at the heart of climate policy - that’s one way to think about it
My newsfeeds and Twitter / X TLs have looked like endless stream of latter-day climate doomerism. More record-breaking heatwaves. The North Atlantic current’s (AMOC) anomalies ringing alarm bells, perhaps too soon. People in Phoenix saying it’s hawt, with 50 Cent (he’s still around after all the Vitamin Water money?!) cancelling a gig. Flooding in northern China. And Spain. Parts of Maui up in smoke amid accusations of failures from the grid operator and emergency services. The human tragedy of all this. Political leaders of all stripes under growing pressure to quickly find and apply solutions. Eye-bleeding stuff.
I’ve always contended that the nauseatingly obvious connection between science-based dialogue and solutions for the climate crisis is politics. You simply cannot get things done at scale without policy - crafted by…politicians! Whether we like it or not, climate issues is only one of a number of concerns that fill up their bandwidth, and at times dovetail or collide with their other priorities.
Many of those same leaders - at the national level at least - are also responsible for national security matters and where those issues intersect with climate, it should come as no surprise that matters of resilient investment, water, energy transition, AI applications and agriculture take on a natsec lens.
For those who are deeply focused on climate solutions, engaging with those working on the policy side of the community can be tremendously valuable, if not essential, to achieving your longer-term targets.
So let’s take a fresh, high-level scan at how key countries and blocs currently view climate x security. There are far more detailed studies on each of these countries’ national security strategies and how climate change is considered, but I want to highlight the key red threads and differences among some of the largest historical and current emitters. This month, I’ll start off with the US, EU and India (host of the next G20 Summit in 2+ weeks’ time), and next month will cover a few others.
🇺🇸US: both the greatest emitter historically AND today, what America does is still going to have tremendous, if not a decisive, influence on the near-term trajectory of emissions and climate-related investments. In the 2022 national security strategy - more of an affirmation of existing policy and some aspirations than a “complete package” in my humble estimation, climate change is seen as “the existential crisis of our times” demanding collaborative action in the international community. Domestically, much of the thrust is on implementing the IRA, and energy security, leadership in a number of regional forums and groupings, and development aid to lower income / SIDS countries either directly or via multilaterals. Adaptation investment gets two brief mentions. From this perspective, we see climate policy and national security / foreign policy blending in several key areas: a) clean energy supply chains that can become resilient from disruption, b) increasing domestic resilience by pushing hard on IRA implementation and c) “on the one hand, but on the other hand” hedging with China where - from a Paris / IPCC6-driven perspective - strategic, sustained cooperation could make 2050 net zero targets more achievable. The Mineral Security Partnership launched by the Biden administration is also emblematic of the “geopolitics of climate trend,” climate policy with a natsec wrapping.
National security is almost certainly not the only factor, or even the decisive factor, driving climate policy, but its influence is sometimes understated in mainstream media and green industry reporting. The military is increasingly cognisant of the need to adapt at all levels to maintain its force preparedness in a 1.5C+ future, ranging from base infrastructure improvements, new monitoring technologies to shifts in internal strategic planning. Its spend - and necessary need to leverage the private sector for people, technology and solutions, as it has in so many other parts of its operations - means that the DoD is a growing consumer of climate mitigation and adaptation solutions. Over time - if ground realities place greater policy pressure to allocate more funds towards this space - it can also become a reference customer that can help scale solutions and bring down costs.
🇪🇺EU - The bloc’s main security policy framework is the Common Security and Defence Policy (CDSP). The policy does not have a specific carve-out for climate risk, but somewhat adjacent issues like crisis management, migration, maritime security and peacekeeping are prominent - and highlight areas where the EU traditionally has found its “sweet spots” vis-a-vis member states’ national security prerogatives. The most recent climate security related statement, in June 2023, highlights several key areas of focus: more effectively use the data and existing bodies a greater climate risk lens to its conflict resolution and peacekeeping work, climate investments, disaster response, peacebuilding, defence cooperation and policy awareness-raising.
Interestingly, it makes the argument - including one made throughout this newsletter - that investing in climate resilience, including biodiversity, especially in security-fragile environments is itself a form of climate security action. In this sense, the EU has reframed and highlighted existing programmes, including one of its key international development instruments (NDICI-Global Europe) as the main tools. This latter programme has a 30% target of its EUR 79.5bn budget spend going to climate mitigation / adaptation efforts, with promises of greater focus on biodiversity related projects through 2027. Over ERU 2bn is planned for projects in the southern/eastern Mediterranean, Central Asia and Latin America combined - not a small amount but a drop in the bucket compared to hundreds of billions needed in these regions through 2050. In 2021, SIPRI assessed the EU’s climate security posturing, arguing that it relied too much on immediate crisis management and long-term prevention e.g. energy transition. The 2023 version, in my view, goes some way in being more comprehensive beyond disaster relief, peacekeeping efforts and longer-term risk planning, taking greater account of data, integrated risk management and policy implementation, and an implicit role for greater adaptation work in the greater European neighbourhood. Written a year after the Russian invasion of Ukraine and amidst continued political challenges in maritime security on its southern borders, it’s hard but not to wonder if the greater push to develop a strategic climate security framework is not only a response to the war, but as an attempt to manage perceived root causes of instability and migration coming from its southern borders.
🇮🇳India: The country has never had a formal national security strategy, instead working off a series of more specific defence, foreign policy and economic directives. It has been argued that to form a strategy would contradict, or at least jeopardise the de facto manner in which Indian foreign policy has operated for decades by being compelled to define red lines, key risks and adversaries that reduce its wiggle room, harkening back to its leading role in the Non-Aligned Movement during the Cold War. Perhaps the nearest thing to such a strategy is the Modi government’s vision of a “self-reliant India” (aatma nirbhar bharat), including a goal for energy independence by 2047. Considering that climate security also incorporates life safety and risks such as food and water security, India is one of the most vulnerable among the major economies. Over 15 states were hit by record heatwaves in 2022, starting abnormally early in late March; this year, heatwaves again started early in April, leading to several hundred deaths in the north-central plains. 2023 saw the hottest February ever in India, with an average national daily maximum of 29.5C. The toll it has on water use and life safety of those who cannot avoid working outdoors or lack access to resources to cool off is tremendous, with many deaths likely preventable. Increased competition over water rights with neighbours e.g. Brahmaputra, Indus and the climate change impacts on the Himalayas and Tibetan plateau bring geopolitical sensitivities to addressing physical risks. India and China are wary of each other in the best of times, and border clashes, periodic flare-ups over boundary markings and tit-for-tat bilateral trade restrictions highlight that these two BRICS+ members are far from aligned on many strategic issues upon which progress on climate cooperation would necessarily rest upon. As such, we then look at a couple of related policies - India policy experts, this is not exhaustive!
Its climate policy bundle is heavily focused around its NDC (National Action Plan for Climate Change), supported by the National Electricity Plan of 2023, National Green Hydrogen Mission and Energy Conservation Act. However, analysis from Climate Action Tracker indicate that while promising, there remains no firm commitment to phase out coal (50%+ of overall energy mix) and gas - for which it is heavily reliant on foreign imports and a source of energy security risk.
India also has launched a critical minerals strategy Like those of the US and EU, it highlights over two dozen minerals as critical to its strategic sectors (economic / national security), and seeks to build domestic resilience focused on developing secure supply chains, building technical expertise, including developing new sources of raw materials such as the lithium deposits in Jammu-Kashmir, and joining up with the US, Australia and others to secure long-term supply of minerals and related investment..
Climate action and adaptation is largely done at a local level: India is no stranger to heatwaves and high levels of humidity and over three dozen cities and states have heat action plans. However, a study in March this year from the Centre for Policy Research in Delhi found that most plans oversimplify the risk, lack local context, underfunded, lack transparency and legal weight, and capacity building is sector-focused versus holistic. It’s a good dive into the realities and challenges to literally keep people safe.
India is one of the largest contributors to UN peacekeeping missions; almost 6,000 are deployed across 12 missions currently. A 2021 report from the Planetary Security Initiative suggests that Indian foreign policy has not given much focus to climate security issues and peacekeeping + leveraging existing regional cooperation forums (e.g. SAARC) can be a launchpad for greater integration between climate policy, and national security and foreign policy initiatives.
Ultimately, for many of these countries climate risk is a core risk to national security because, left unmitigated it can have catastrophic consequences for economic security and military readiness. Climate cooperation, however much we would prefer for it to be global and sustainable - as the nice-looking models may have us think - is unlikely to shape up as such. There are many reasons why, but I offer a few:
🎯Core national security interests will inherently insert a degree of inefficiency in the energy transition in the name of resilience (localisation of resources, supply chains, capital and talent). In many instances localisation may in practice mean partnering with key high-trust allies, forming “corridors” of secure supply chains e.g. US-Mexico-Canada under the USMCA pact. Subsidies and higher unit prices of raw and final goods could further incentivise innovation and create markets where it may have not occurred - the IRA is a partially good example of this.
💎 All major countries have some form of critical minerals policy or initiative, reflecting their importance to their economic and national security. Continue to watch this space as a growing flashpoint of future geopolitical competition, and perhaps conflict.
🌪️Climate policies are going to continue to be filtered, funneled, implemented - and if you’re cynical, weaponised, diluted, shoehorned - to achieve other political objectives: in the US, it’s jobs, in the EU - it’s countering Russia and the flow of migrants. Those working to build, fund and implement the decarbonisation and adaptation journeys should appreciate the risks and opportunities these may present to their specific patches of turf. Sometimes the ends may justify the means, and other times perhaps not so.
🤺Great power competition never truly went away after the Cold War but it’s back with a vengeance! The US-China strategic rivalry is poised to dominate international politics and serve as the backdrop for the ebb and flow of the global economy until at least mid-century. Among other things like the prospect of all-out war, how this relationship evolves will likely have a significant impact on the overall cost - and therefore - achievability of Paris targets, which get increasingly aggressive as each month passes. We should remain ever hopeful that cooperation over decarbonisation and net zero between the two largest current CO2 emitters can be largely shielded or serve as a platform for broader engagement - but the political winds for now are not blowing that way.
🌐 Markets for key technologies and raw materials may struggle to become (or remain) truly global, even if deposits are exploited at scale globally, if national regimes of export controls, tariffs and sanctions impact tech and flow of funds needed for the energy transition. Cue previous bullet: just as subsidies and artificially stimulated local demand can bring firms to life, those same conditions could limit where solutions, people and capital can be deployed or sold.
Resilience, redundancy and healthy competition at this level is necessary and to a degree desirable, without necessarily stifling innovation. Rather, it creates opportunities for localised solutions to bloom where they otherwise wouldn’t. An emerging challenge may be financing at scale across borders: would flows of capital hit more geopolitical and regulatory speed bumps? How would that impact the flow of technologies and talent, and risks of intellectual property theft / forced technology transfer? As a firm, would you be able to sell widely and still be onside in your home market (for example, look at how in the tech and semiconductor worlds how TikTok/Bytedance and ARM are faring)?
So for consideration, a few things watch out for (among other things) in the coming years:
Changes in levels of trade - including bilateral investment - between the US and China around climate-related sectors and projects
Material shifts in value of raw and intermediate material exports among emerging “secure supply chain partnerships” in North America, MSP and Quad members.
How successful over time are big “winners” in key sectors e.g. EVs, utility scale batteries, etc beyond their home markets.
What other indicators would you consider?
What else caught my eye: callouts, events, jobs and other cool stuff
The US’ Federal Emergency Management Agency (FEMA) announced $3bn in climate resilience funding, part of the bipartisan infrastructure law passed in 2022 - that act does keep on giving. What appears different about this package is that the funds are meant to go hardening assets such as power grids to mitigate the damage from future natural disasters.
“Every dollar that we spend in resilience – like this money right here – saves us $6 in response and recovery costs,” [FEMA Administrator Diane] Criswell told CNN. “We want to reduce that complexity of the recoveries, which saves money on the disaster relief fund, because then we don’t have to spend as much to help communities recover from these types of disasters.”
The New York Times did a piece on the impact of climate change in Iraq: drying of the old salt marshes, depleted aquifers, dirty and salty water and further damming upriver. Displacement is also facilitating militancy:
Finally, after almost five years, ISIS was vanquished and the villagers began to come back. Now the chief enemy is drought, stealing not just their livelihoods, but also their sense of safety. In some places, the water hardly covers the pebbles lining the riverbed. ISIS barely has to slow down to get across. “We used to be protected by the river,” said Sheikh Muhammed. “Now, sometimes they walk, sometimes they drive their motorbikes, the water is so low.”
Also from the NYT, a piece on climate adaptation in light of the extreme heat this summer in the US.
An interesting podcast on the future of investing and managing water to reduce conflict and increase collaboration - involving governments, community leaders and investors alike.
UCL Early Warnings conference, London 11-13 Sep. Three days of presentations focused on the science, innovations and challenges facing early warning systems for both weather and conflict.
NY Climate Week - 17-24 Sep. The Coachella and Glasto of all things climate.
The Nature Conservancy is looking for a project manager focused on climate resilience and disaster mitigation in California.
And finally: power corrupts absolutely.
Back at ya next month!