Category Archives: Markets

The Northern Frontier: Who’s Taking Advantage of Climate Change?

Owing to climate change…the share of boreal land that can support farming could increase from 8% to 41% in Sweden. It could increase from 51% to 83% in Finland. Efforts to farm these areas will alarm people who value boreal forests for their own sake. And cutting down such forests and ploughing up the soils that lie beneath them will release carbon. But the climatic effects are not as simple as they might seem. Northern forests absorb more heat from the sun than open farmland does, because snow-covered farmland reflects light back into space…

The fact that felling boreal forests may not worsen climate change, though, says nothing about the degree to which it could affect biodiversity, ecosystem services or the lives of forest dwellers, particularly indigenous ones.

Some governments are already keen to capitalize on climate change. Russia’s has long talked of higher temperatures as a boon. President Vladimir Putin once boasted that they would enable Russians to spend less money on fur coats and grow more grain. In 2020 a “national action plan” on climate change outlined ways in which the country could “use the advantages” of it, including expanding farming. Since 2015 Russia has become the world’s largest producer of wheat, chiefly because of higher temperatures.

Russia’s government has started leasing thousands of square kilometers of land in the country’s far east to Chinese, South Korean and Japanese investors. Much of the land, which was once unproductive, is now used to grow soybeans. Most are imported by China, helping the country reduce its reliance on imports from America. Sergey Levin, Russia’s deputy minister of agriculture, has predicted that soya exports from its far-eastern farmlands may reach $600m by 2024. That would be nearly five times what they were in 2017. The government of Newfoundland and Labrador, a province on the north-eastern tip of Canada, is also trying to promote the expansion of agriculture into lands covered by forests…

All told, the northern expansion of farmland will only go some way towards mitigating the damage climate change may do to agriculture. The societies that will benefit from it are mostly already wealthy. Poor places, which rely much more heavily on income from exporting agricultural produce, will suffer.

Excerpts from Farming’s New Frontiers: Agriculture, Economist, August 28, 2021

When the Cat’s Away the Mice Pollute

Police don’t share schedules of planned raids. Yet America’s Environmental Protection Agency (EPA) does not seem convinced of the value of surprise in deterring bad behavior. Every year it publishes a list of dates, spaced at six-day intervals, on which it will require state and local agencies to provide data on concentrations of harmful fine particulate matter (pm2.5), such as soot or cement dust…

A new paper by Eric Zou of the University of Oregon makes use of satellite images to spy on polluters at times when they think no one is watching. NASA, America’s space agency, publishes data on the concentration of aerosol particles—ranging from natural dust to man-made toxins—all around the world, as seen from space. For every day in 2001-13, Mr Zou compiled these readings in the vicinity of each of America’s 1,200 air-monitoring sites.

Although some stations provided data continuously, 30-50% of them sent reports only once every six days. For these sites, Mr Zou studied how aerosol levels varied based on whether data would be reported. Sure enough, the air was consistently cleaner in these areas on monitoring days than it was the rest of the time, by a margin of 1.6%. Reporting schedules were almost certainly the cause….The size of this “pollution gap” differed by region. It was biggest in parts of Appalachia and the Midwest with lots of mining, and in the northern Mountain West, where paper and lumber mills are common.

The magnitude of the gap also depended on the cost of being caught. Every year, the EPA produces a list of counties whose average air quality falls below minimum standards. The punishments for inclusion are costly: factories become subject to burdensome clean-technology requirements, and local governments can be fined. When firms risked facing sanctions, they seemed to game the system more aggressively. In counties that exceeded the pm2.5 limit in a given month, the pollution gap in the following month swelled to 7%. In all other cases, it was just 1.2%….

Excerpts from Poorly devised regulation lets firms pollute with abandon: We Were Expecting you, Economist, Sept. 4, 2021

How to Suck Carbon and Convert it to Rocks

The Orca carbon-capture plant, just outside Reykjavik in Iceland, has switched on its fans and began sucking carbon dioxide from the air since September 2021. The sound was subtle—a bit like a gurgling stream. But the plant’s creators hope it will mark a big shift in humanity’s interaction with the climate. Orca is, for now, the largest installation in the infant “direct air capture” industry, which aims to remove CO2 from the atmosphere. When sealed underground such CO2 counts as “negative emissions”—an essential but underdeveloped method for tackling global warming.

Thus, the full operation extracts CO2 from air and turns it to rock. Trials have shown that Icelandic basalts can sequester CO2 in solid rock within two years. Power comes from a nearby geothermal power station….One catch is volume. Orca will capture 4,000 tonnes of carbon dioxide a year, out of around 35bn tonnes produced by burning fossil fuels. Another is cost. It costs Orca somewhere between $600-800 to sequester one tonne of carbon dioxide, and the firm sells offset packages online for around $1,200 per tonne. The company thinks it can cut costs ten-fold through economies of scale. But there appears to be no shortage of customers willing to pay the current, elevated price. Even as Orca’s fans revved up, roughly two-thirds of its lifetime offering of carbon removals had already been sold. Clients include corporations seeking to offset a portion of their emissions, such as Microsoft, Swiss Re as well as over 8,000 private individuals.

Climeworks is not alone in having spotted the opportunity. Using different chemistry, Carbon Engineering, a Canadian company, is gearing up to switch on its own carbon-scrubbing facilities. It will take more than these pioneer engineers and financiers to build a gigatonne-sized industry. But the fans are turning. 

Excerpts from Removing carbon dioxide from the air: The world’s biggest carbon-removal plant switches on, Economist, Sept. 18, 2021

A New Page in History of Nuclear Energy?

A new page in the history of nuclear energy could be written this September 2021, in the middle of the Gobi Desert, in the north of China. At the end of August 2021, Beijing announced that it had completed the construction of its first thorium-fueled molten-salt nuclear reactor, with plans to begin the first tests of this alternative technology to current nuclear reactors within the next two weeks…

The Chinese reactor could be the first molten-salt reactor operating in the world since 1969, when the US abandoned its Oak Ridge National Laboratory facility in Tennessee. “Almost all current reactors use uranium as fuel and water, instead of molten salt and thorium,” which will be used in China’s new plant. These two “new” ingredients were not chosen by accident by Beijing: molten-salt reactors are among the most promising technologies for power plants

With molten-salt technology, “it is the salt itself that becomes the fuel”….The crystals are mixed with nuclear material – either uranium or thorium – heated to over 500°C to become liquid, and are then be able to transport the heat and energy produced. Theoretically, this process would make the installations safer. “Some accident risks are supposedly eliminated because liquid burning avoids situations where the nuclear reaction can get out of control and damage the reactor structures.”

There’s another advantage for China: this type of reactor does not need to be built near watercourses, since the molten salts themselves “serve as a coolant, unlike conventional uranium power plants that need huge amounts of water to cool their reactors”.  As a result, the reactors can be installed in isolated and arid regions… like the Gobi Desert.

Thorium belongs to a famous family of rare-earth metals that are much more abundant in China than elsewhere; this is the icing on the cake for Chinese authorities, who could increase its energy independence from major uranium exporting countries, such as Canada and Australia, two countries whose diplomatic relations with China have collapsed in recent years.

According to supporters of thorium, it would also a “greener” solution. Unlike the uranium currently used in nuclear power plants, burning thorium does not create plutonium, a highly toxic chemical element…

Among the three main candidates for nuclear reaction – uranium 235, uranium 238 and thorium – the first is “the only isotope naturally fissile”, Sylvain David explained. The other two must be bombarded with neutrons for the material to become fissile (able to undergo nuclear fission) and be used by a reactor: a possible but more complex process. Once that is done on thorium, it produces uranium 233, the fissile material needed for nuclear power generation….”This is an isotope that does not exist in nature and that can be used to build an atomic bomb,” pointed out Francesco D’Auria.

Excerpts from Why China is developing a game-changing thorium-fueled nuclear reactor, France24, Sept. 12, 2021

Mobile Nuclear Energy for the Arctic: Dream to Reality

Four small modular reactors (SMRs) will power the huge Baimskaya copper and gold mining development in the Russian Arctic, according to an agreement signed by Rosatom subsidiary Atomflot…Baimskaya is one of the world’s largest mineral deposits and is very rich in copper and gold. However, development of the remote site in Russia’s eastern Chukotka region demands a complex multi-partner plan involving the Russian government, the regional government and developers…

Nuclear power already plays a role in Baimskaya’s development as early facilities there are powered by the Akademik Lomonosov floating nuclear power plant at Pevek. KAZ Minerals said the plant will supply up to 20 MWe of nuclear power to the mine during its construction phase….Based on the agreement, two additional floating power plants will provided, each with two RITM-200M reactors. The first two should be in operation at Cape Nagloynyn by the beginning of 2027, the third in 2028 and the final one at the start of 2031….

Excerpts from SMRs to power Arctic development, World Nuclear News, Sept. 3, 2021

The $22 Trillion Global Carbon Market

Two of the world’s biggest oil companies, Royal Dutch Shell  and BP already have significant carbon-emissions trading arms, thanks to a relatively well-developed carbon market in Europe. Big carbon emitters such as steel producers receive emission allowances, and can buy more to stay under European emissions guidelines. Companies that fall below those limits can sell their excess carbon-emissions allowances.

Carbon traders get in the middle of those transactions, seeking to profit from even small moves in the price of carbon and sometimes betting on the direction of prices. The value of the world’s carbon markets—including Europe and smaller markets in places such as California and New Zealand—grew 23% last year to €238 billion, equivalent to $281 billion.

That is small compared with the world’s multitrillion-dollar oil markets and to other heavily traded energy markets, such as natural gas or electricity. But growth potential exists, the industry says. Wood Mackenzie, an energy consulting firm, estimates a global carbon market could be worth $22 trillion by 2050… An experienced carbon trader’s base salary can be roughly $150,000 to $200,000, although a lot of compensation occurs via bonuses, traders said…. BP’s overall annual trading profits were between $3.5 billion and $4 billion during the past two years, according to a person familiar with the matter.

Excerpts from Sarah McFarlane, Energy Traders See Big Money in Carbon-Emissions Markets, WSJ, Sept. 9, 2021

The 17 000 Nuclear Objects Dumped in the Kara Sea


“Having the exact coordinates for the dumped container with the nuclear reactors from K-19 submarine is undoubtedly good news,” says nuclear safety expert Andrey Zolotkov. Zolotkov hopes for risk assessments to be carried out soon with the aim to see how the nuclear reactors could be lifted out of the maritime environment and brought to a yard for safe decommissioning…More than 50 years have passed since the dumping.

In the so-called “White Book” on dumped nuclear objects, originally published by President Boris Yeltsin’s environmental advisor Alexei Jablokov, the dumping of the submarine’s two reactors is listed for the Abrosimova Bay on the east coast of the Kara Sea, but exact location hasn’t been confirmed.

It was in August 2021 that the the crew on “Akademik M. Keldysh” with the help of sonars and submersibles found the container. Both marine researchers, oceanology experts from Russia’s Academy of Science and representatives of the Ministry of Emergency Situations are working together in the expedition team.

K-19 is one of the most infamous nuclear-powered submarines sailing for the Soviet navy’s Northern Fleet. In July 1961 the reactor lost coolant after a leak in a pipe regulating the pressure to the primary cooling circuit. The reactor water started boiling causing overheating and fire. Crew members managed to extinguish the fire but had big problems fixing the leak in an effort to save the submarine from exploding. Many of them were exposed to high doses of radioactivity before being evacuated to a nearby diesel submarine sailing in the same area of the North Atlantic. Eight of the crew members who had worked on the leak died of radiation poisoning within a matter of days.

The submarine was towed to the Skhval shipyard (No. 10) in Polyarny. Later, the reactor compartment was cut out and a new installed. The two damaged reactors, still with spent nuclear fuel, were taken north to the Kara Sea and dumped. Keeping the heavily contaminated reactors at the shipyard was at the time not considered an option.

In the spring of 2021, Russia’s Foreign Ministry invited international experts from the other Arctic nations to a conference on how to recover sunken radioactive and hazardous objects dumped by the Soviet Union on the seafloor east of Novaya Zemlya. Moscow chairs the Arctic Council for the 2021-2023 period. 

The two reactors from the K-19 submarine are not the only objects posing a risk to marine environment. In fact, no other places in the world’s oceans have more radioactive and nuclear waste than the Kara Sea. Reactors from K-11 and K-140, plus the entire submarine K-27 and spent uranium fuel from one of the old reactors of the “Lenin” icebreaker are also dumped in the same sea. While mentality in Soviet times was «out of sight, out of mind», the Kara Sea seemed logical. Ice-covered most of the year, and no commercial activities. That is changing now with rapidly retreating sea ice, drilling for oil-, and gas, and increased shipping…Additional to the reactors, about 17,000 objects were dumped in the Kara Sea in the period from the late 1960s to the early 1990s.

Excerpts from Thomas Nilsen, Expedition finds reactors 56 years after dumping, The Barents Observer, Sept. 2, 2021

Measuring Methane Emissions

The American gas industry faces growing pressure from investors and customers to prove that its fuel has a lower-carbon provenance to sell it around the world. That has led the top U.S. gas producer, EQ , and the top exporter, Cheniere Energy to team up and track the emissions from wells that feed major shipping terminals. The companies are trying to collect reliable data on releases of methane—a potent greenhouse gas increasingly attracting scrutiny for its contributions to climate change—and demonstrate they can reduce these emissions over time.

“What we’re trying to really do is build the trust up to the end user that our measurements are correct,” said David Khani, EQT’s chief financial officer. “Let’s put our money where our mouth is.” Natural gas has boomed world-wide over the past few decades as countries moved to supplant dirtier fossil fuels such as coal and oil. It has long been touted as a bridge to a lower-carbon future. But while gas burns cleaner than coal, gas operations leak methane, which has a more potent effect on atmospheric warming than carbon dioxide, though it makes up a smaller percentage of total greenhouse gas emissions.

Investors, policy makers and buyers of liquefied natural gas, known as LNG, are rethinking the fuel’s role in their energy mix …Those concerns, pronounced in Europe and increasingly in Asia, are a problem for LNG shippers, as some of their customers signal plans to ease gas consumption over time…Nearly every industry now faces some pressure to reduce its carbon footprint, as investors focus more on ESG—or environmental, social and governance—issues and push companies for trustworthy emissions data. But the pressure has become particularly acute for oil-and-gas companies, whose main products contribute directly to climate change.

The companies and researchers plan to test drones, specialized cameras that can see methane gas, and other technologies across about 100 wells in the Marcellus Shale in the northeast U.S., the Haynesville Shale of East Texas and Louisiana, and the Permian Basin of West Texas and New Mexico. EQT has said it would spend $20 million over the next few years to replace leaky pneumatic devices, which help move fluids from wells to production facilities and water tanks, with electric-drive valves, executives said. They expect that will cut about 80% of the company’s methane emissions. The company also began exclusively using electric-powered hydraulic fracturing equipment last year.

Excerpts from Collin Eaton Frackers, Shippers Eye Natural-Gas Leaks as Climate Change Concerns Mount, WSJ, Aug. 13, 2021

Amazon Deforestation: Putting a Number on Climate Damage

In April 2021, the Brazilian Federal Public Prosecutor’s Office filed a public civil action against a rural landowner, seeking the landowner’s accountability for alleged illegal deforestation connected to breeding cattle in the Amazon….Aside from demanding compensation for environmental damages, collective damages, as well as compensation due to the profits illegally obtained in the logging process, the prosecutor required that the defendant pay compensation for climate damages resulting from the deforestation, something until now unwitnessed in cases of this sort in Brazil. N

By employing a carbon calculator software developed by IPAM, the Amazonian Research Institute, the Prosecutor’s Office calculated how much carbon was expected to have been released into the atmosphere per hectare of deforestation in that particular area. With that information, knowing the extension of the deforestation and using the carbon pricing practiced by the Amazon Fund, the Prosecutor’s Office came to the conclusion that the defendant was liable for a BRL 44.7 million compensation for climate damages.

Excerpts from Climate litigation in Brazil: new strategy from prosecutors on climate litigation against private entities, Mayer/Brown, June 21, 2021

Africa’s Single Electricity Market: Pools and Mini-Grids

Given this the magnitude of the energy access problem in Africa, a continent-wide risk-guarantee scheme should be established, ideally by a combination of African and other multilateral lending institutions. Such an integrated approach, through which overall savings can outweigh risk premia  could be articulated under the aegis of the African Single Electricity Market, launched in early February 2021 with the main goal of harmonizing regulatory and technical aspects of electricity generation, transmission, and distribution across the continent…

Most electricity projects in Africa are undertaken by foreign developers, notably European, Chinese, and United States companies, owing to their experience and, especially, their ability to secure financing. As a result, African governments have introduced different types of so-called local-content requirements, namely obligations concerning local employment, procurement of local goods and services, and the transfer of technologies and know-how, to which foreign investors have to abide. In countries such as Kenya and Nigeria, these requirements are defined through quantitative targets, whereas in other countries, such as Uganda and Zambia, they take the form of qualitative goals….

Power pooling, through cross-border trade in electric power, helps reduce electricity bills and enhances the reliability of electricity supply. Regional power pools, based increasingly on renewable energy supplies, are now possible across most of the African continent. Nonetheless, additional efforts are needed to reap the full benefits of power pooling….

South Africa is the main electricity producer for the Southern African power pool, facilitated by the Southern African Development Community (SADC). Given the challenges that the country is increasingly facing to meet its domestic demand for electricity, and the sharp decreases in cost of solar, wind, and energy storage, the case for relying on solar and wind energy–powered electricity generation becomes stronger in the region. Yet, at present, for both renewable energy and electric-power transmission, many of the investment discussions in the SADC region focus on large dams, which have been the technology of choice for decades. Concentrating solar power, a technology that generates electricity from the heat obtained by concentrating solar energy (in contrast to converting solar energy directly into electricity, as photovoltaic systems do), is already being deployed in South Africa…. Concentrating solar power technology can help shift the balance away from hydropower and toward solar energy, but only to the extent that stronger financial incentives are in place, compared to those introduced thus far…

To date, the members of the Maghreb Electricity Committee (COMELEC), Northern Africa’s power pool, have only engaged in cross-border trade with the Iberian Peninsula, across the Mediterranean Sea (Spain currently exports electricity to Morocco). As concentrating solar power in Morocco develops, the country plans to export electricity to Spain and possibly Portugal. Tunisia and Egypt are planning similar export arrangements (with Italy and Greece, respectively). Against this background, COMELEC has pledged to launch, in 2025, a common electricity market for its five members…

Both the Eastern Africa Power Pool (EAPP) and the West African Power Pool (WAPP) originate from preexisting cross-border arrangements aimed at promoting cooperation on energy issues. In both regions, cooperation thus far has been limited to bilateral agreements, such as the lines linking Kenya with Ethiopia and Ghana with Burkina Faso….The Central African Power Pool (CAPP) remains underdeveloped. Poverty and other developmental challenges in the region limit the size of the electricity market, thus inflating prices.

In moderately populated areas, where both grid extension and deployment of a relatively large number of stand-alone electricity-generation systems would be prohibitively expensive, off-grid mini-grids are the most economical electrification option in most cases. The so-called third-generation minigrids, which combine photovoltaic solar systems and batteries with or without a back-up diesel-powered electricity generator, require less than 2 weeks of scheduled maintenance per year. Such a high level of reliability makes it possible to incentivize off-grid mini-grid deployment through performance-based subsidies.  For example, with World Bank backing, Nigeria’s rural electrification agency pays off-grid mini-grid developers US$ 350 per connection, provided that the customer has had a steady supply of power for at least 3 months. Similarly, the reliability of third-generation mini-grids allows developers to offer customers a contract that includes, in addition to the electricity connection, the option to purchase income-generating appliances, such as machines for welding, milling, and rice hulling, thus increasing deployment rates…

Overcoming the barriers to interconnected mini-grid development requires national governments to clarify licensing procedures and tariff regulations and ultimately establish unambiguous tariff levels for the various interconnection options, a set of tasks that can be facilitated by the International Renewable Energy Agency….

Excerpts from Daniel Puig et al., An Action Agenda for Africa’s Electricity Sector, Science, Aug. 6, 2021

Imagining Failure: Nuclear Waste on the Beach, California

But for all the good vibes and stellar sunsets of  San Onofre state beach in California, beneath the surface hides a potential threat: 3.6m lb of nuclear waste from a group of nuclear reactors shut down nearly a decade ago. Decades of political gridlock have left it indefinitely stranded, susceptible to threats including corrosion, earthquakes and sea level rise. The San Onofre reactors are among dozens across the United States phasing out, but experts say they best represent the uncertain future of nuclear energy.

“It’s a combination of failures, really,” said Gregory Jaczko, who chaired the US Nuclear Regulatory Commission (NRC), the top federal enforcer, between 2009 and 2012, of the situation at San Onofre. That waste is the byproduct of the San Onofre Nuclear Generating Station (Songs), three nuclear reactors primarily owned by the utility Southern California Edison (SCE) that has shut down….

Since there is not central repository for the final disposition of nuclear wasted in the United States,  the California Coastal Commission approved in 2015 the construction of an installation at San Onofre to store it until 2035. In August 2020, workers concluded the multi-year burial process, loading the last of 73 canisters of waste into a concrete enclosure. San Onofre is not the only place where waste is left stranded. As more nuclear sites shut down, communities across the country are stuck with the waste left behind. Spent fuel is stored at 76 reactor sites in 34 states….

At San Onofre, the waste is buried about 100ft from the shoreline, along the I-5 highway, one of the nation’s busiest thoroughfares, and not far from a pair of faults that experts say could generate a 7.4 magnitude earthquake. Another potential problem is corrosion. In its 2015 approval, the Coastal Commission noted the site could have a serious impact on the environment in case of coastal flooding and erosion hazards beyond its design capacity, 

Concerns have also been raised about government oversight of the site. Just after San Onofre closed, SCE began seeking exemptions from the NRC’s operating rules for nuclear plants. The utility asked and received permission to loosen rules on-site, including those dealing with record-keeping, radiological emergency plans for reactors, emergency planning zones and on-site staffing.

San Onofre isn’t the only closed reactor to receive exemptions to its operating licence. The NRC’s regulations historically focused on operating reactors and assumed that, when a reactor shut down, the waste would be removed quickly.

It’s true that the risk of accidents decreases when a plant isn’t operating, said Dave Lochbaum of the Union of Concerned Scientists. But adapting regulations through exemptions greatly reduces public transparency, he argued. “Exemptions are wink-wink, nudge-nudge deals with the NRC,” he said. “In general, it’s not really a great practice,” former NRC chair Jaczko said about the exemptions. “If the NRC is regulating by exemption, it means that there’s something wrong with the rules … either the NRC believes the rules are not effective, and they’re not really useful, or the NRC is not holding the line where the NRC should be holding line,” he said…

It’s worth considering how things fail, though, argued Rod Ewing, nuclear security professor at Stanford University’s center for international security and cooperation, and author of a 2021 report about spent nuclear waste that focuses on San Onofre. “The problem with our safety analysis approach is we spend a lot of time proving things are safe. We don’t spend much time imagining how systems will fail,” he said. “And I think the latter is what’s most important.”

Excerpts from Kate Mishkin, ‘A combination of failures:’ why 3.6m pounds of nuclear waste is buried on a popular California beach, Guardian, Aug. 

Who Owns your Cells? the case of Henrietta Lacks

In 1951, a young mother of five named Henrietta Lacks visited The Johns Hopkins Hospital complaining of vaginal bleeding….As medical records show, Mrs. Lacks began undergoing radium treatments for her cervical cancer…. A sample of her cancer cells retrieved during a biopsy were sent, without her knowledge or consent, to Dr. George Gey’s nearby tissue lab. For years, Dr. Gey, a prominent cancer and virus researcher, had been collecting cells from all patients who came to The Johns Hopkins Hospital with cervical cancer, but each sample quickly died in Dr. Gey’s lab. What he would soon discover was that Mrs. Lacks’ cells were unlike any of the others he had ever seen: where other cells would die, Mrs. Lacks’ cells doubled every 20 to 24 hours.

Today, these incredible cells— nicknamed “HeLa” cells, from the first two letters of her first and last names — are used to study the effects of toxins, drugs, hormones and viruses on the growth of cancer cells without experimenting on humans. They have been used to test the effects of radiation and poisons, to study the human genome, to learn more about how viruses work, and played a crucial role in the development of the polio vaccine.

In July 2021, the family of Henrietta Lacks has hired a prominent civil rights attorney, who says he plans to seek compensation for them from big pharmaceutical companies across the country that made fortunes off medical research with her famous cancer cells…The legal team is investigating lawsuits against as many as 100 defendants, mostly pharmaceutical companies, but they haven’t ruled out a case against the Johns Hopkins Hospital.’

Excerpts from Family of Henrietta Lacks hires civil rights attorney to seek funds over famous cells, Washington Post, July 31, 2021, and https://www.hopkinsmedicine.org/henriettalacks/

The Uses and Abuses of Alexa

Excerpts from the Interview with Robert Lewis Shayon author of “The Voice Catchers: How Marketers Listen In to Exploit Your Feelings, Your Privacy, and Your Wallet” published  at the Pennsylvania Gazette July 2021

There is  emerging industry that is deploying immense resources and breakthrough technologies based on the idea that voice is biometric—a part of your body that those in the industry believe can be used to identify and evaluate you instantly and permanently. Most of the focus in voice profiling technology today is on emotion, sentiment, and personality. But experts tell me it is scientifically possible to tell the height of a person, the weight, the race, and even some diseases. There are actually companies now trying to assess, for example, whether you have Alzheimer’s based upon your voice…

The issue is that this new voice intelligence industry—run by companies you know, such as Amazon and Google, and some you don’t, such as NICE and Verint—is sweeping across society, yet there is little public discussion about the implications. The need for this conversation becomes especially urgent when we consider the long-term harms that could result if voice profiling and surveillance technologies are used not only for commercial marketing purposes, but also by political marketers and governments, to say nothing of hackers stealing data.

There are hundreds of millions of smart speakers out there, and far more phones with assistants, listening to you and capturing your voice. Voice technology already permeates virtually every important area of personal interaction—as assistants on your phone and in your car, in smart speakers at home, in hotels, schools, even stores instead of salespeople. 

Amazon and Google have several patents centering around voice profiling that describe a rich future for the practice…But consider the downside: we could be denied loans, have to pay much more for insurance, or be turned away from jobs, all on the basis of physiological characteristics and linguistic patterns that may not reflect what marketers believe they reflect.

The first thing to realize is that voice assistants are not our friends no matter how friendly they sound. I argue, in fact, that voice profiling marks a red line for society that shouldn’t be crossed.

The Dirty Secrets of Clean Energy

Solar panel installations are surging in the U.S. and Europe as Western countries seek to cut their reliance on fossil fuels. But the West faces a conundrum…: Most of them are produced with energy from carbon-dioxide-belching, coal-burning plants in China.

Concerns are mounting in the U.S. and Europe that the solar industry’s reliance on Chinese coal will create a big increase in emissions in the coming years as manufacturers rapidly scale up production of solar panels to meet demand. That would make the solar industry one of the world’s most prolific polluters, analysts say, undermining some of the emissions reductions achieved from widespread adoption. For years, China’s low-cost, coal-fired electricity has given the country’s solar-panel manufacturers a competitive advantage, allowing them to dominate global markets.

Chinese factories supply more than three-quarters of the world’s polysilicon, an essential component in most solar panels, according to industry analyst Johannes Bernreuter…Producing a solar panel in China creates around twice as much carbon dioxide as making it in Europe, said Fengqi You, professor of energy systems engineering at Cornell University.

Some Western governments and corporations are attempting to shift the solar industry away from coal…These policies would also help rebuild the West’s solar industry, which has withered under competition from higher-polluting Chinese producers, Western executives say…China has pushed down the price of panels so sharply that solar power is now less expensive than electricity generated from fossil fuels in many markets around the world. Imports of the solar cells that make up the panels are also flooding into the U.S. and Europe. Those shipments are either coming directly from China or contain key components made in China. “If China didn’t have access to coal, then solar power wouldn’t be cheap now,” said Robbie Andrew, a senior researcher at the Center for International Climate Research in Oslo. “Is it OK that we’ve had this huge bulge of carbon emissions from China because it allowed them to develop all these technologies really cheaply? We might not know that for another 30 to 40 years.”

Excerpts from Matthew Dalton, Behind the Rise of U.S. Solar Power, a Mountain of Chinese Coal, July 31, 2021

From Pegasus to Pariah: Israeli Spying is Not Sexy

When international news organizations revealed that at least ten governments had used Pegasus, a powerful software tool created by Israel’s NSO Group, to hack into the smartphones of thousands of people around the world, including politicians, human-rights activists and journalists, the Israeli government shrugged. None of its ministers has publicly commented….Israeli defence exporters privately expressed ridicule. “Arms companies can’t keep track of every rifle and bullet they sell to legitimate customers,” said one. “Why should we have higher expectations when it comes to software?…Israeli spying is a sexy subject and these reports are the price for doing business.”

Countries that have received Pegasus software include Brazil, Hungary and India, along with Sunni Arab regimes with whom Israel recently established diplomatic relations: Bahrain, Morocco and the United Arab Emirates. Saudi Arabia, a fellow enemy of Iran, is listed, too. “Deals on cyber-surveillance are the kind of sweetener you can throw into a diplomatic package with a foreign leader,” says a former NSO consultant.

Excerpts from Let Pegasus fly: Israel is loth to regulate its spyware exports, Economist, July 31, 2021

Sponsors of War: Captagon at $25 Better than Alcohol

In Saudi Arabial party-goers prefer Captagon pills (to alcohol), nowadays the Gulf’s favorite drug, at $25 a pop. Part of the amphetamine family, it can have a similar effect to Viagra—and conquers sleep. “With one pill,” says a raver, “we can dance all weekend.”

For Syria’s president, Bashar al-Assad, the drug has become a boon—at least in the short run. His country has become the world’s prime pusher of Captagon. As the formal economy collapses under the burden of war, sanctions and the predatory rule of the Assads, the drug has become Syria’s main export and source of hard currency. The Centre for Operational Analysis and Research (COAR), a Cyprus-based consultancy, reckons that last year authorities elsewhere seized Syrian drugs with a street value of no less than $3.4bn. That compares with Syria’s largest legal export, olive oil, which is worth some $122m a year. The drug is financing the central government, says Ian Larson, who wrote a recent report on the subject for COAR…

Chemical plants in the cities of Aleppo and Homs have been converted into pill factories. In the Gulf the mark-up for pills can be 50 times their cost in Syria. Smugglers hide them in shipments of paper rolls, parquet flooring and even pomegranates. Saudi princes use private jets to bring the stuff in

For the Syrians left behind, drugs may destroy what remains of society after a decade of civil war. “Young men who haven’t been killed, exiled or jailed are addicts,” says a social worker in Sweida, a city held by the Assads in the south. 

Excerpt from Pop a pill, save a dictator: Syria has become a narco-state, Economist, July 19, 2021

The Necessity of the Evil: Breeding Monkeys to Experiment with their Brains

In 2014 a German animal-rights group called soko Tierschutz planted a caretaker in the laboratory of Nikos Logothetis, a neuroscientist working at the Max Planck Institute in Tübingen. The infiltrator secretly filmed around 100 hours of lab work over six months, some of which was later broadcast on German television. The footage showed monkeys with metal plugs grafted into their skulls—ports which researchers used to probe and study their brains. One vomits on camera, apparently as a result of damage done to blood vessels in its brain while electrodes were inserted.

The impact was immediate and lasting. Around 800 people massed outside Dr Logothetis’s lab, demanding an end to his work with monkeys. He was called a monster and a murderer. He and his family received death threats. He faced charges (which were dismissed) of breaking German animal-welfare laws. So in 2020 he announced that his laboratory would move to China. He is building a new research facility in Shanghai, working with Mu-ming Poo of the Institute of Neuroscience, one of China’s leading brain researchers, who was on the team responsible for first cloning a genetically modified primate in 2018. 

In East Asia, particularly China and Japan, the volume of research carried out on monkeys is growing. Most of this has been driven by creating and expanding domestic primate-research programmes. Leading institutions such as the Shanghai Institute of Neuroscience focus on breeding monkeys whose genomes have been modified in order to make their physiology more like humans’ and so more useful for studying human diseases.

The social nature of monkeys and their intelligence—which is why they are so useful for research—also help explain why such experiments are so troubling. Research which relies on them is simultaneously more valuable and more ethically fraught than research on other creatures. Neuroscientists in particular consider monkeys irreplaceable. The brain is so poorly understood that looking at its activity in living creatures is the only way to fathom how it works, says Dr Treue. Dissecting dead brains produces only limited information. Brains only really make sense when active. Few humans would volunteer to have electrodes implanted in their brains. The consent of any who did would be suspect….

The list of medical advances which rest on animal experimentation is long, but Dr Bennett points to one in particular that could not have happened without monkeys: prosthetic limbs which “talk” to the brain, known as neural prosthetics. The brains of non-human primates are sufficiently similar to ours to allow for a prosthetic developed on monkeys to be used by humans. They are still rare, but prototypes have restored the power to interact with the physical world to people who have lost the use of their own limbs.

China is becoming the global centre for the kind of neuroscience that uses monkeys. And the stakes are getting higher. Neurological disorders are the world’s second-leading cause of death after heart disease. Conditions such as Parkinson’s disease, Alzheimer’s and dementia are becoming more burdensome as the world gets greyer. Meanwhile technology companies hope that an understanding of the brain can help them build cleverer software. Generals think advances in neuroscience can help them build better weapons.

The pandemic has bolstered China’s position. In February 2020 China’s government banned the export of all wild animals in an effort to tamp down the wildlife trade that is thought to be a vector for the zoonotic spillover of pathogens such as sars-cov-2, the virus that causes covid-19. Exceptions for research are subject to the government’s approval. Until recently the majority of monkeys used in America were imported from farms in China. But export controls have created shortages. China has decided that research primates are a strategic resource. Exports are unlikely to revert to their previous levels…America and Europe may find themselves outsourcing the creation of knowledge that relies on research methods they consider unethical. In future they may have to choose between relying on the fruits of that knowledge, such as treatments for neurological disorders, and rejecting them in principle….

Excerpt from Money Business: Attitudes towards experimenting on monkeys are diverging, Economist, July 24, 2021

The Trillion Dollar Mess: Taking Down the Oil Infrastructure

Some of the world’s largest oil companies have been ordered to pay part of a $7.2 billion tab to retire hundreds of aging wells in the Gulf of Mexico that they used to own, capping a case that legal experts say is a harbinger of future battles over cleanup costs.

A federal judge ruled last month that Fieldwood Energy a privately held company that currently controls the old wells and had sought bankruptcy protection, could pass on hundreds of millions of dollars in environmental liabilities to prior owners and insurers of the wells as part of its reorganization plan. Exxon Mobil,  BP, Hess , Royal Dutch Shell and insurance companies had objected to the plan. The dispute, litigated for months in federal bankruptcy court in Houston, centered over who should bear the enormous costs of capping and abandoning wells, primarily in the shallow waters of the Gulf of Mexico where an oil spill could wreak havoc. The companies could still appeal the ruling…

Jason Bordoff, founding director of Columbia University’s Center for Global Energy Policy said that the expenses to decommission oil-and-gas infrastructure world-wide will in the trillions of dollars. “Who bears the costs?” he said. “There will be people who want to pass the buck.”

BP and Shell have pledged to reduce their carbon emissions to zero by 2050. To accomplish that, those companies will have to sell off some oil-and-gas wells to get their related emissions off their books, say energy analysts. But such asset sales present huge risks for big oil companies because many of the buyers are smaller, privately held firms, like Fieldwood, which may not have the financial wherewithal to bear cleanup costs, Ms. Usoro said. This was Fieldwood’s second bankruptcy in two years.

These smaller companies buy the wells for pennies on the dollar and assume the cleanup expenses in the hope that they can reduce the assets’ cost structure and squeeze out the remaining barrels of oil profitably. “I’ve always questioned this business model,” said Ms. Usoro. “Are these guys able to take care of the end of life?”

Excerpts Christopher M. Matthews, Oil Companies Are Ordered to Help Cover $7.2 Billion Cleanup Bill in Gulf of Mexico, WSJ, July 6, 2021

From Natural Landmark to an Oil Spill Wasteland

Mohammad Abubakar, Minister of Environment  disclosed in July 2021 that Nigeria recorded 4,919 oil spills between 2015 to March 2021 and lost 4.5 trillion barrels of oil to theft in four years.

Mr Abubakar disclosed this at a Town Hall meeting in Abuja, organised by the Ministry of Information and Culture, on protecting oil and gas infrastructure. “The operational maintenance is 106, while sabotage is 3,628 and yet to be determined 70, giving the total number of oil spills on the environment to 235,206 barrels of oil. This is very colossal to the environment.

“Several statistics have emphasised Nigeria as the most notorious country in the world for oil spills, loosing roughly 400,000 barrels per day. “The second country is followed by Mexico that has reported only 5,000 to 10,000 barrel only per day, thus a difference of about 3, 900 per cent.

“Attack on oil facilities has become the innovation that replaced agitations in the Niger Delta region against perceived poor governance and neglect of the area.

Excerpts from Nigeria Records 4,919 Oil Spills in 6 Years, 4.5trn Barrels Stolen in 4 Years, AllAfrica.com, July 6, 2021

Yummy Plastics

“From Waste to Food: A Generator of Future Food” by Ting Lu and Stephen Techtmann, won the Merck 1 million prize.  It concerns an efficient, economical and versatile technology that converts wastes such as end-of-life plastics into edible foods. These foods contain all the required nutrition, are non-toxic, provide health benefits, and additionally allow for personalization needs. This technology promises to transform waste streams into nutritious food supplements, thus solving the two problems of increasing food scarcity and plastic waste simultaneously.

The core of the proposed technology is to harness synthetic microbial consortia – a combination of natural and rationally engineered microorganisms – in order to efficiently convert waste into food. The project will comprise four research goals: conversion from polyethylene terephthalate (PET) to protein powder (goal 1), augmentation of biosafety for food and for the environment (goal 2), introduction of nutritional and health-promoting contents (goal 3), and expansion of the technology to include additional plastics or other types of waste (goal 4). The proposed work will establish a transformative basis for food generation.

  • Excerpts from Future Insight Prize, Merck Press Release, July 13, 2021

How to Spy on Your Own Country for $1.25 per day

San Francisco-based Premise Data Corp. pays users, many of them in the developing world, to complete basic tasks for small payments. Typical assignments involve snapping photos, filling out surveys or doing other basic data collection or observational reporting such as counting ATMs or reporting on the price of consumer goods like food.

About half of the company’s clients are private businesses seeking commercial information, Premise says. That can involve assignments like gathering market information on the footprint of competitors, scouting locations and other basic, public observational tasks. Premise in recent years has also started working with the U.S. military and foreign governments, marketing the capability of its flexible, global, gig-based workforce to do basic reconnaissance and gauge public opinion.

Premise is one of a growing number of companies that straddle the divide between consumer services and government surveillance and rely on the proliferation of mobile phones as a way to turn billions of devices into sensors that gather open-source information useful to government security services around the world.

Premise launched in 2013,, As of 2019, the company’s marketing materials said it has 600,000 contributors operating in 43 countries, including global hot spots such as Iraq, Afghanistan, Syria and Yemen. According to federal spending records, Premise has received at least $5 million since 2017 on military projects—including from contracts with the Air Force and the Army and as a subcontractor to other defense entities. In one pitch on its technology, prepared in 2019 for Combined Joint Special Operations Task Force-Afghanistan, Premise proposed three potential uses that could be carried out in a way that is “responsive to commander’s information requirements”: gauge the effectiveness of U.S. information operations; scout and map out key social structures such as mosques, banks and internet cafes; and covertly monitor cell-tower and Wi-Fi signals in a 100-square-kilometer area. The presentation said tasks needed to be designed to “safeguard true intent”—meaning contributors wouldn’t necessarily be aware they were participating in a government operation…

 Another Premise document says the company can design “proxy activities” such as counting bus stops, electricity lines or ATMs to provide incentives for contributors to move around as background data is gathered. Data from Wi-Fi networks, cell towers and mobile devices can be valuable to the military for situational awareness, target tracking and other intelligence purposes. There is also tracking potential in having a distributed network of phones acting as sensors, and knowing the signal strength of nearby cell towers and Wi-Fi access points can be useful when trying to jam communications during military operations. Nearby wireless-network names can also help identify where a device is, even if the GPS is off, communications experts say.

Mr. Blackman said gathering open-source data of that nature doesn’t constitute intelligence work. “Such data is available to anyone who has a cellphone,” he said. “It is not unique or secret.” Premise submitted a document last July to the British government describing its capabilities, saying it can capture more than 100 types of metadata from its contributors’ phones and provide them to paying customers—including the phone’s location, type, battery level and installed apps. 

Users of the Premise app aren’t told which entity has contracted with the company for the information they are tasked with gathering. The company’s privacy policy discloses that some clients may be governments and that it may collect certain types of data from the phone, according to a spokesman…Currently the app assigns about five tasks a day to its users in Afghanistan, according to interviews with users there, including taking photos of ATMs, money-exchange shops, supermarkets and hospitals. One user in Afghanistan said he and others there are typically paid 20 Afghani per task, or about 25 cents—income for phone and internet services. A few months ago, some of the tasks on the site struck him as potentially concerning. He said the app posted several tasks of identifying and photographing Shiite mosques in a part of western Kabul populated largely by members of the ethnic Hazara Shiite minority. The neighborhood was attacked several times by Islamic State over the past five years…. Because of the nature and location of the tasks in a hot spot for terrorism, the user said he thought those tasks could involve spying and didn’t take them on.

Excerpt from Byron Tau, App Users Unwittingly Collect Intelligence, WSJ,  June 25, 2010

Green Con Artists and their Moneyed Followers

Green investing has grown so fast that there is a flood of money chasing a limited number of viable companies that produce renewable energy, electric cars and the like. Some money managers are stretching the definition of green in how they deploy investors’ funds. Now billions of dollars earmarked for sustainable investment are going to companies with questionable environmental credentials and, in some cases, huge business risks. They include a Chinese incinerator company, an animal-waste processor that recently settled a state lawsuit over its emissions and a self-driving-truck technology company.

One way to stretch the definition is to fund companies that supply products for the green economy, even if they harm the environment to do so. In 2020 an investment company professing a “strong commitment to sustainability” merged with the operator of an open-pit rare-earth mine in California at a $1.5 billion valuation. Although the mine has a history of environmental problems and has to bury low-level radioactive uranium waste, the company says it qualifies as green because rare earths are important for electric cars and because it doesn’t do as much harm as overseas rivals operating under looser regulations…

When it comes to green companies, “there just isn’t enough” to absorb investor demand…In response, MSCI has looked at other ways to rank companies for environmentally minded investors, for example ranking “the greenest within a dirty industry”….

Of all the industries seeking green money, deep-sea mining may be facing the harshest environmental headwinds. Biologists, oceanographers and the famous environmentalist David Attenborough have been calling for a yearslong halt of all deep-sea mining projects. A World Bank report warned of the risk of “irreversible damage to the environment and harm to the public” from seabed mining and urged caution. More than 300 deep-sea scientists released a statement today calling for a ban on all seabed mining until at least 2030. In late March 2021, Google, battery maker Samsung SDI Co., BMW AG and heavy truck maker Volvo Group announced that they wouldn’t buy metals from deep-sea mining.

[However the The Metals Company (TMC) claims that deep seabed mining is green].

Excerpts from Justin Scheck et al, Environmental Investing Frenzy Stretches Meaning of ‘Green’, WSJ, June 24, 2021

Junk: the Engine of Green Growth

“Plastic waste is not just a global crisis that threatens economic recovery, climate, and nature. It is also an investment opportunity that can flip it from a scourge into an engine for economic development,” said Rob Kaplan, who founded Circulate Capital in 2017. Initially the firm sought to back companies in India and Southeast Asia, such as recycling or waste-sorting companies, that help reduce the amount of plastic waste that winds up in the ocean.

In 2019 it raised a $106 million debt and project finance fund, Circulate Capital Ocean Fund, backed by a handful of large multinational corporations that include Coca-Cola, Danone,  Procter & Gamble,  and Unilever…Circulate is one of a small but growing number of firms investing in companies that contribute to what they call the circular economy, a business model that seeks to eliminate waste that organizations produce, continuously reuse products and materials and regenerate natural systems.

An estimated 30 private-market funds, including private-equity, venture and debt strategies focused on the circular economy in the first half of 2020, up from just three in 2016….A number of large multinational corporations are funding these firms’ efforts as part of a broader push to reduce both the overall waste their own companies produce and the amount of virgin materials they use.

Unilever, which has backed funds managed by Circulate and New York-based Closed Loop Partners, aims to cut in half the amount of virgin plastic it uses by 2025 and plans to collect and process more plastic packaging than it sells. Coca-Cola, also a backer of Circulate’s Ocean fund, aims to make all of its global packaging recyclable by 2025 and to use at least 50% of recycled packaging material by 2030, among other goals.

Excerpt from Laura Kreutzer, Growth Firms See Plastic Waste as an Investment Opportunity, WSJ, June 23, 2021
 

Save Time and Money but Destroy Soil and Oceans

The images of swaths of garbage floating on the oceans’ surface have become a rallying call to address plastic pollution, but there is more to this challenge than meets the eye. While plastics and microplastics – items smaller than 5 mm – accumulate and impact marine environments, much of the problem is rooted in land contamination. Land-based plastic pollution, which often feeds into the oceans, is estimated to be at least four times higher than what is in the oceans, according to a study published in Global Change Biology. 

“Soil is the main source of microplastics reaching oceans through soil erosion and surface runoff,”  Plastics settle in soil through disposal in landfills, as well as through the use of plastic-sheets in agriculture or application of microplastic contaminated compost. “Direct disposal of plastics to ocean is relatively less pronounced compared to the transfer of microplastics from land. Microplastics, lighter than soil particles, such as sand, silt and clay, are easily lost to waterways,”…

“We contribute to plastic pollution through indiscriminate disposal of plastics in landfills and use of microbeads in cosmetics and microfibers in textiles. There are efforts to produce biodegradable plastics, which may provide some solution to plastic pollution, but bioplastic may not be the silver bullet to manage plastic pollution.” Commonly used biodegradable bioplastics “retain their mechanical integrity under natural conditions, potentially causing physical harm if they are ingested by marine or terrestrial animals.” “The fate of biodegradable bioplastics in natural and engineered environments could be potentially problematic. Methane is a product of biodegradation in anaerobic environments in landfills.” These bioplastics, furthermore, require high temperatures, controlled aeration and humidity to degrade completely.

Due to their small size, microplastics, especially nanoplastics resulting from the degradation of microplastic, can enter organisms’ internal organs, where they could potentially transfer contaminants attached to them. These can include persistent organic pollutants, like polychlorinated biphenyls (PCBs), as well as trace metals like mercury and lead. The plastics and pollutants that accumulate on or in them enter the food chain and can eventually be transferred to humans, causing growing food safety concerns.

The Joint FAO/IAEA Centre’s laboratories are equipped to research the presence of microplastics in food. “Techniques such as energy dispersive X-ray spectroscopy and infrared and Raman spectroscopy can be applied to screen for plastics in foods, enabling risk assessment and management,” said Andrew Cannavan, Head of the Joint Centre’s Food and Environmental Protection Section. 

Excerpt from Joanne Liou Out of Sight but not out of Mind: IAEA and FAO Launch R&D to Identify Sources, Impacts of Microplastic Pollution in Soil, IAEA Press Release, July 2, 2021

How to Remove Carbon from 30 Million Cars Every Single Year

Gabon is the first country in Africa to receive results-based payments for reduced emissions from deforestation and forest degradation. The first payment is part of the breakthrough agreement between Gabon and the multi-donor UN-hosted Central African Forest Initiative’s (CAFI) in 2019 for a total of $150 million over ten years.

At a high-level event organised on Tuesday, Sveinung Rotevatn, Norway’s Minister of Climate and Environment said on behalf of CAFI: “This is the first time an African country has been rewarded for reducing forest-related emissions at the national level.  It is extremely important that Gabon has taken this first step. The country has demonstrated that with strong vision, dedication and drive, emissions reductions can be achieved in the Congo Basin forest.” Gabon is leading the way in maintaining its status of High Forest Cover Low Deforestation (HFLD) country. ..

Gabon has preserved much of its pristine rainforest since the early 2000s in creating 13 national parks, one of which is listed UNESCO World Heritage Site. Its forests absorb a total of 140 million tons of CO2 every year, the equivalent of removing 30 million cars from the road globally.

Gabon has also made significant advances in sustainable management of its timber resources outside the parks, with an ambition to ensure that all forest concessions are FSC-certified. Forest spans over 88% of its territory, and deforestation rates have been consistently low (less than 0.08%) since 1990. Gabon’s forests house pristine wildlife and megafauna including 60% of the remaining forest elephants, sometimes called the “architects” or “gardeners” of the forest for their roles in maintaining healthy ecosystems and recently listed as critically endangered.

Excerpt from Gabon receives first payment for reducing CO2 emissions under historic CAFI agreement, Central African Forest Initiative, June 22, 2021

The Reckless Gambles that Changed the World: darpa

Using messenger RNA to make vaccines was an unproven idea. But if it worked, the technique would revolutionize medicine, not least by providing protection against infectious diseases and biological weapons. So in 2013 America’s Defense Advanced Research Projects Agency (DARPA) gambled. It awarded a small, new firm called Moderna $25m to develop the idea. Eight years, and more than 175m doses later, Moderna’s covid-19 vaccine sits alongside weather satellites, GPS, drones, stealth technology, voice interfaces, the personal computer and the internet on the list of innovations for which DARPA can claim at least partial credit.

It is the agency that shaped the modern world, and this success has spurred imitators. In America there are ARPAS for homeland security, intelligence and energy, as well as the original defense one…Germany has recently established two such agencies: one civilian (the Federal Agency for Disruptive Innovation, or SPRIN-d) and another military (the Cybersecurity Innovation Agency). Japan’s interpretation is called Moonshot R&D. 

As governments across the rich world begin, after a four-decade lull, to spend more on research and development, the idea of an agency to invent the future (and, in so doing, generate vast industries) is alluring and, the success of DARPA suggests, no mere fantasy. In many countries there is displeasure with the web of bureaucracy that entangles funding systems, and hope that the DARPA model can provide a way of getting around it. But as some have discovered, and others soon will, copying DARPA requires more than just copying the name. It also needs commitment to the principles which made the original agency so successful—principles that are often uncomfortable for politicians.

On paper, the approach is straightforward. Take enormous, reckless gambles on things so beneficial that only a handful need work to make the whole venture a success. As Arun Majumdar, founding director of ARPA-e, America’s energy agency, puts it: “If every project is succeeding, you’re not trying hard enough.” Current (unclassified) DAROA projects include mimicking insects’ nervous systems in order to reduce the computation required for artificial intelligence and working out how to protect soldiers from the enemy’s use of genome-editing technologies.

The result is a mirror image of normal R&D agencies. Whereas most focus on basic research, DARPA builds things. Whereas most use peer review and carefully selected measurements of progress, DARPA strips bureaucracy to the bones (the conversation in 1965 which led the agency to give out $1m for the first cross-country computer network, a forerunner to the internet, took just 15 minutes). All work is contracted out. DARPA has a boss, a small number of office directors and fewer than 100 program managers, hired on fixed short-term contracts, who act in a manner akin to venture capitalists, albeit with the aim of generating specific outcomes rather than private returns.

Excerpt from Inventing the future: A growing number of governments hope to clone America’s DARPA, Economist, June 5, 2021

Can the Switzerland of Chips Crush the Global Economy?

Taiwan Semiconductor Manufacturing Co (TSMC) has emerged over the past several years as the world’s most important semiconductor company, with enormous influence over the global economy. With a market cap of around $550 billion, it ranks as the world’s 11th most valuable company. Its dominance leaves the world in a vulnerable position, however. As more technologies require chips of mind-boggling complexity, more are coming from this one company, on an island that’s a focal point of tensions between the U.S. and China, which claims Taiwan as its own.

The situation is similar in some ways to the world’s past reliance on Middle Eastern oil, with any instability on the island threatening to echo across industries….Being dependent on Taiwanese chips “poses a threat to the global economy,” research firm Capital Economics recently wrote. Its technology is so advanced, Capital Economics said, that it now makes around 92% of the world’s most sophisticated chips, which have transistors that are less than one-thousandth the width of a human hair. Samsung Electronics Co. makes the rest. 

The U.S., Europe and China are scrambling to cut their reliance on Taiwanese chips. While the U.S. still leads the world in chip design and intellectual property with homegrown giants like Intel Corp. , Nvidia Corp. and Qualcomm, it now accounts for only 12% of the world’s chip manufacturing, down from 37% in 1990, according to Boston Consulting Group. President Biden’s infrastructure plan includes $50 billion to help boost domestic chip production. China has made semiconductor independence a major tenet of its national strategic plan. The European Union aims to produce at least 20% of the world’s next-generation chips in 2030 as part of a $150 billion digital industries scheme.

The Taiwanese maker has also faced calls from the U.S. and Germany to expand supply due to factory closures and lost revenues in the auto industry, which was the first to get hit by the current chip shortage.

Semiconductors have become so complex and capital-intensive that once a producer falls behind, it’s hard to catch up. Companies can spend billions of dollars and years trying, only to see the technological horizon recede further. A single semiconductor factory can cost as much as $20 billion. One key manufacturing tool for advanced chip-making that imprints intricate circuit patterns on silicon costs upward of $100 million, requiring multiple planes to deliver

Taiwanese leaders refer to the local chip industry as Taiwan’s “silicon shield,” helping protect it from such conflict. Taiwan’s government has showered subsidies on the local chip industry over the years, analysts say.

Excerpts from Yang Jie et al., The World Relies on One Chip Maker in Taiwan, Leaving Everyone Vulnerable, WSJ, June 19, 2021

Tesla as Catfish: When China Carps-Tech CEOs Fall in Line

Many countries are wrestling with how to regulate digital records. Some economies, including in Europe, emphasize the need for data privacy, while others, such as China and Russia, put greater focus on government control. The U.S. currently doesn’t have a single federal-level law on data protection or security; instead, the Federal Trade Commission is broadly empowered to protect consumers from unfair or deceptive data practices.

Behind China’s moves is a growing sense among leaders that data accumulated by the private sector should in essence be considered a national asset, which can be tapped or restricted according to the state’s needs, according to the people involved in policy-making. Those needs include managing financial risks, tracking virus outbreaks, supporting state economic priorities or conducting surveillance of criminals and political opponents. Officials also worry companies could share data with foreign business partners, undermining national security.


Beijing’s latest economic blueprint for the next five years, released in March 2021, emphasized the need to strengthen government sway over private firms’ data—the first time a five-year plan has done so. A key element of Beijing’s push is a pair of laws, one passed in June 2021, the Data Security Law,  and the other a proposal updated by China’s legislature in Apr0il 2021. Together, they will subject almost all data-related activities to government oversight, including their collection, storage, use and transmission. The legislation builds on the 2017 Cybersecurity Law that started tightening control of data flows.

The law will “clearly implement a more stringent management system for data related to national security, the lifeline of the national economy, people’s livelihood and major public interests,” said a spokesman for the National People’s Congress, the legislature. The proposed Personal Information Protection Law, modeled on the European Union’s data-protection regulation, seeks to limit the types of data that private-sector firms can collect. Unlike the EU rules, the Chinese version lacks restrictions on government entities when it comes to gathering information on people’s call logs, contact lists, location and other data.

In late May 2021, citing concerns over user privacy, the Cyberspace Administration of China singled out 105 apps—including ByteDance’s video-sharing service Douyin and Microsoft Corp.’s Bing search engine and LinkedIn service—for excessively collecting and illegally accessing users’ personal information. The government gave the companies named 15 days to fix the problems or face legal consequences….

Beijing’s pressure on foreign firms to fall in line picked up with the 2017 Cybersecurity Law, which included a provision calling for companies to store their data on Chinese soil. That requirement, at least initially, was largely limited to companies deemed “critical infrastructure providers,” a loosely defined category that has included foreign banks and tech firms….Since 2021, Chinese regulators have formally made the data-localization requirement a prerequisite for foreign financial institutions trying to get a foothold in China. Citigroup Inc. and BlackRock Inc. are among the U.S. firms that have so far agreed to the rule and won licenses to start wholly-owned businesses in China…

Senior officials have publicly likened Tesla to a “catfish” rather than a “shark,” saying the company could uplift the auto sector the way working with Apple and Motorola Mobility LLC helped elevate China’s smartphone and telecommunications industries. To ensure Tesla doesn’t become a security risk, China’s Cyberspace Administration recently issued a draft rule that would forbid electric-car makers from transferring outside China any information collected from users on China’s roads and highways. It also restricted the use of Tesla cars by military personnel and staff of some state-owned companies amid concerns that the vehicles’ cameras could send information about government facilities to the U.S. In late May 2021, Tesla confirmed it had set up a data center in China and would domestically store data from cars it sold in the country. It said it joined other Chinese companies, including Alibaba and Baidu Inc., in the discussion of the draft rules arranged by the CyberSecurity Association of China, which reports to the Cyberspace Administration…

Increasingly, China’s president, Mr. Xi, leaned toward voices advocating greater digital control. He now labels big data as another essential element of China’s economy, on par with land, labor and capital.  “From the point of view of the state, anti-data monopoly must be strengthened,” said Li Lihui, a former president of state-owned Bank of China Ltd. and now a member of China’s legislature. He said he expects China to establish a “centralized and unified public database” to underpin its digital economy.

Excerpts from China’s New Power Play: More Control of Tech Companies’ Troves of Data, WSJ, June 12, 2021

Fossil-Free in 2026

Norrland (in Sweden) abounds in hydropower. Power that is cheap and—crucially—green, along with bargain land and proximity to iron ore, is sparking an improbable industrial revolution, based on hydrogen, “green” steel and batteries. SSAB, a steelmaker, is poised to deliver its first consignment of “eco-steel” from a hydrogen-fuelled pilot plant in Lulea, a northern city. 

Traditionally, to make steel, iron ore must be melted at high temperatures and reduced from iron oxide to iron, a process that typically involves burning fossil fuels, releasing huge amounts of carbon dioxide. Replacing them with hydrogen eliminates more than 98% of the carbon dioxide normally released. The hydrogen is made by electrolysing water, using electricity produced by hydro-power. This approach involves almost no carbon-dioxide emissions at all…..

Northern Sweden’s steelmaking leaps are being emulated elsewhere in Europe, in response to similar environmental pressures which will only increase if, as looks very likely, Germany’s Greens enter government after the election in September 2021. Europe produces a still significant 16% of the world’s steel. Big producers in Germany and Poland, where the industry is mostly coal-based and very dirty, are nervy. Even neighbouring Norway is in danger of losing out. It too has the gift of rich renewable-energy resources, but underinvestment means there may soon not be enough of this green electricity to meet the demands of both households and industry.

Excerpts from Green steel: Plentiful renewable energy is opening up a new industrial frontier, Economist, May 15, 2021

Resurrecting Used Materials: the Battle against E-Waste

Electric vehicles (EVs) continue to grow in popularity. According to IHS Markit, a research firm, almost 2.5m battery-electric and plug-in-hybrid cars were sold around the world in 2020—and the company expects that number to grow by 70% in 2021…. And, when all of these machines come to the ends of their useful lives, they will need to be recycled.

This coming avalanche of e-waste will be hard to deal with. When a petrol or diesel car is dismantled and crushed, as much as 95% of it is likely to be used again. Ways to do that are well-developed, straightforward and helped by the fact that, on average, almost 70% of such a vehicle consists of readily recyclable ferrous metals. EVs, by contrast, contain a far greater variety of materials. Separating and sorting these is tricky, especially as many of them are locked up inside complex electrical components.

For those who can manage to do so, though, there is good business to be had here. EVs contain lots of valuable stuff. The magnets in their motors are full of rare-earth metals, and their batteries of lithium and cobalt…Li-Cycle, a Canadian company founded in 2016 that is already the biggest recycler of lithium-ion batteries in North America, is one outfit betting on hydrometallurgy. Li-Cycle is not alone, though, in its hydrometallurgical ambitions. One rival is Redwood Materials of Carson City, Nevada…Northvolt… makes lithium-ion batteries for European carmakers. It is adding a recycling plant to its factory in Sweden, to process the batteries it produces there when they reach the ends of their lives. led. Similar “closed-loop” systems are being developed in other parts of the battery supply chain. For example, American Battery Technology, a firm in Nevada that mines and processes lithium, is adding a recycling plant intended to recover lithium and other metals from expired batteries. It will use the lithium in its own production processes and sell the other materials on.

The biggest battery-recycling operations of all, though, are not Western, but Chinese—not surprising, perhaps, given that China is the world’s largest market for EVs, and the country’s government has been promoting the recycling of lithium-ion batteries for some time. Brunp Reycling , a subsidiary of CATL, the world’s biggest EV-battery-maker, has half-a-dozen hydrometallurgical recycling operations around the country. Brunp says it can recycle 120,000 tonnes of old batteries a year, which it claims represents about half of China’s current annual battery-recycling capacity. …

Tesla itself also has trans-Pacific ambitions. It is setting up a battery-recycling facility at its  EV factory in Shanghai, to complement one it is developing at its battery factory in Nevada. Nor is Tesla the only vehicle-maker involving itself in the industry. In January, Volkswagen opened a pilot battery-recycling plant in Salzgitter. Salzgitter is close to the company’s battery factory in Braunschweig, which is being expanded to produce more than 600,000 EV battery packs a year. The idea is the firm’s battery experts will work with its recyclers to make battery packs easier to dismantle.

Designing recyclability in from the beginning will, in the long run, be crucial to the effective recycling of electric vehicles—and especially their batteries. Shredding lots of different types of e-waste at the same time inevitably results in contamination. Separating components before doing so would yield greater levels of purity.

Excerpts from Old electric cars are a raw material of the future, Economist, May 15, 2021

When Others Do our Dirty Work: the Costs of Overdependence

China is tightening its grip on the global supply of processed manganese, rattling a range of companies world-wide that depend on the versatile metal—including the planet’s biggest electric-vehicle makers.

China produces more than 90% of the world’s manganese products, ranging from steel-strengthening additives to battery-grade compounds. Since October 2020, dozens of Chinese manganese processors accounting for most of global capacity have joined a state-backed campaign to establish a “manganese innovation alliance,” led by Ningxia Tianyuan Manganese Industry Group, setting out in planning documents goals and moves that others in the industry say are akin to a production cartel. They include centralizing control over supply of key products, coordinating prices, stockpiling and networks for mutual financial assistance.

The squeeze sent prices soaring in metal markets world-wide, snagging steelmakers and sharpening concern among car makers. China’s metal industries already dominate the global processing of most raw materials for rechargeable batteries, including cobalt and nickel. Three-quarters of the world’s lithium-ion batteries and half of its electric vehicles are made in China.  High-purity forms of manganese have increasingly become crucial for battery-powered automobiles, touted by Volkswagen AG and Tesla Inc. in recent months as a viable replacement for other, more-expensive battery ingredients….

While manganese ore is relatively abundant around the world, it is almost solely refined in China. Battery-grade manganese is traded mostly privately, and pricing can be opaque. Miners say a metric ton of the purified metal could cost up to $4,000—barely a 10th of the cost of cobalt, a widely used battery metal. By replacing cobalt, manganese could help auto makers produce 30% more cars with the same amount of nickel, analysts say.

Rival manganese projects outside China view the cartel-like activities as an opportunity to gain momentum for their own battery-grade developments…Still, analysts say such projects outside China might take years to start and heavy cost investments to develop. Viable bases of manganese ore are often located in remote regions, which require expensive infrastructure to ferry and process extracted ores.

Excerpt from Chuin-Wei Yap, China Hones Control Over Manganese, a Rising Star in Battery Metals, WSH, May 21, 2021

Can We Change Path? Saving Forests and Cutting Carbon

No ecosystem is more important in mitigating the effects of climate change than tropical rainforest. And South-East Asia is home to the world’s third-biggest patch of it, behind the Amazon and Congo basins. Even though humans release carbon from these forests through logging, clear-felling for agriculture and other disruptions, some are so vast and fecund that the growth of the plants within them absorbs even more from the atmosphere. The Congo basin, for instance, locks up 600m tonnes of carbon a year more than it releases, according to the World Resources Institute (WRI), an international NGO that is equivalent to about a third of emissions from all American transport.

In contrast, such is the extent of clearing for plantations in South-East Asia’s rainforests, which run from Myanmar to Indonesia, that over the past 20 years they have turned from a growing carbon sink to a significant source of emissions—nearly 500m tonnes a year. Indonesia and Malaysia, home to the biggest expanses of pristine forest, have lost more than a third of it this century. Cambodia, Laos and Myanmar, relative newcomers to deforestation, are making up for lost time.

The Global Forest Watch, which uses satellite data to track tree cover, loss of virgin forest in Indonesia and Malaysia has slowed for the fourth year in row—a contrast with other parts of the world…The Leaf Coalition, backed by America, Britain and Norway, along with such corporate giants as Amazon, Airbnb, and Unilever, aims to create an international marketplace in which carbon credits can be sold for deforestation avoided. An initial $1bn has been pledged to reward countries for protecting forests. South-East Asia could be a big beneficiary,

Admittedly, curbing deforestation has been a cherished but elusive goal of climate campaigners for ages. A big un initiative to that end, called REDD+, was launched a decade ago, with Indonesia notably due for help. It never achieved its potential. Projects for conservation must jump through many hoops before approval. The risk is often that a patch of forest here may be preserved at the expense of another patch there. Projects are hard to monitor. The price set for carbon under the scheme, $5 a tonne, has been too low to overcome these hurdles.

The Leaf Initiative would double the price of carbon, making conservation more attractive. Whereas buyers of carbon credits under REDD+ pocketed profits from a rise in carbon prices, windfalls will now go to the country that sold the credits. Standards of monitoring are much improved. Crucially, the scheme will involve bigger units of land than previous efforts, the so-called jurisdictional approach. That reduces the risk of deforestation simply being displaced from a protected patch to an unprotected one.

Excerpts from Banyan: There is hope for South-East Asia’s beleaguered tropical forests, Economist, May 1, 2021

The Wild West Mentality of Companies Running the U.S. Oil and Gas Infrastructure — and Who Pays for It

The ransomware attack on Colonial Pipeline Co. in May 2021 has hit an industry that largely lacks federal cybersecurity oversight, leading to uneven digital defenses against such hacks.

The temporary shutdown of Colonial’s pipeline, the largest conduit for gasoline and diesel to the East Coast, follows warnings by U.S. officials in recent months of the danger of cyberattacks against privately held infrastructure. It also highlights the need for additional protections to help shield the oil-and-gas companies that power much of the country’s economic activity, cyber experts and lawmakers say. “The pipeline sector is a bit of the Wild West,” said John Cusimano, vice president of cybersecurity at aeSolutions, a consulting firm that works with energy companies and other industrial firms on cybersecurity. Mr. Cusimano called for rules similar to the U.S. Coast Guard’s 2020 regulations for the maritime sector that required companies operating ports and terminals to put together cybersecurity assessments and plans for incidents.

 More than two-thirds of executives at companies that transport or store oil and gas said their organizations are ready to respond to a breach, according to a 2020 survey by the law firm Jones Walker LLP. But many don’t take basic precautions such as encrypting data or conducting dry runs of attacks, said Andy Lee, who chairs the firm’s privacy and security team. “The overconfidence issue is a serious phenomenon,” Mr. Lee said.

Electric utilities are governed by rules enforced by the North American Electric Reliability Corp., a nonprofit that reviews companies’ security measures and has the power to impose million-dollar fines if they don’t meet standards. There is no such regulatory body enforcing standards for oil-and-gas companies, said Tobias Whitney, vice president of energy security solutions at Fortress Information Security. “There aren’t any million-dollar-a-day potential fines associated with oil-and-gas infrastructure at this point,” he said. “There’s no annual audit.”

Excerpt from David Uberti and Catherine Stupp, Colonial Pipeline Hack Sparks Questions About Oversight, WSJ, May 11, 2021

The Coin Curse: Bitcoin, Dogecoin and Carbon

Environmentalists…fret about how much energy bitcoin uses. In a paper in Nature Communications, a group of academics…examine bitcoin’s energy use in China. They conclude that, in the absence of legal curbs, bitcoin could by 2024 become a “non-negligible” barrier to China’s efforts to decarbonize its economy.

Bitcoin’s hunger for energy stems from its design. It forgoes centralised record-keeping in favour of a “blockchain”, a transaction database that is distributed among users. The blockchain is maintained by “miners”, who validate transactions by competing to crack mathematical puzzles with solutions that are hard to find but easy to check. Each successfully mined block of transactions generates a reward, currently 6.25 bitcoins ($357,000).

The system varies the difficulty of the puzzles to ensure that one new block is created, on average, every ten minutes. High bitcoin prices make it worthwhile to spend more computing power—and therefore electricity—chasing mining rewards…

Despite the currency’s democratic ambitions, mining is concentrated among a handful of professional operators. About 70% takes place in China. Scientists have concluded that, without regulation, Chinese bitcoin mining could consume around as much energy as Italy or Saudi Arabia by 2024. Annual carbon emissions, at 130m tonnes, would approach those of Nigeria. Such numbers should be taken with a good deal of salt. Bitcoin’s energy use depends crucially on its price, which swings wildly…

But the general picture—that bitcoin is a dirty business—fits with other research. One oft-cited model, which uses publicly available blockchain data, reckons its global energy consumption is already equal to that of Kazakhstan, and that its carbon footprint matches Hong Kong’s.

Excerpts from The dirty truth: Totting up bitcoin’s environmental costs, Economist, Apr. 10, 2021

A Gun to their Head: the Exclusive Vaccine Club

International tensions over access to Covid-19 vaccines have intensified as supply hiccups disrupt mass rollouts of shots. But trade experts warn that restrictions on vaccine exports risk making a bad situation worse. That’s because the world’s major vaccine producers rely on each other for the essential ingredients to manufacture vaccines through a web of cross-border supply chains in complex chemicals, fatty acids and glass vials. If governments restrict vaccine exports, they risk retaliation from other members of this exclusive club of vaccine makers, who could withhold vital supplies, squeezing production just when it is needed most.

These supply chains stretch across the world, drawing in producers of basic chemicals that provide critical ingredients as well as the pharmaceutical powerhouses that make the vaccines. The  U.S. , the  European Union  and  China  are among a handful of territories that produce vaccine ingredients and final vaccines for the entire world. More than half of global vaccines and of key vaccine ingredients come from the  U.S.  and  EU . These 12 countries and the EU make up the “Vaccine Club”—producers that make both the key ingredients as well as final vaccines

The members of the vaccine club, though, source on average 88.3% of the imported ingredients used in vaccine production from other club members, according to economists led by Simon Evenett, professor of international trade and economic development at the University of St. Gallen in Switzerland, who have mapped trade flows between the world’s major vaccine producers. Limiting vaccine exports to another major producer would therefore risk retaliatory action that could undermine production, threatening the mass vaccination drives that are the key to ending the pandemic, Prof. Evenett said. “Everyone has a gun to each other’s heads,” he said.

Excerpts from The Covid-19 Vaccine Club: How the World’s Biggest Producers Depend on Each Other, WSJ, May 1, 2021

Begging for a Vaccine: the other COVID crisis

On April 16, 2021  Adar Poonawalla, head of the world’s biggest vaccine-maker, the Serum Institute of India (SII), begged President Joe Biden, in a tweet, to ‘lift the embargo of raw material exports out of the us.’… because it would affect the manufacturing of vaccines: AstraZeneca’s, of which SII makes 100m doses a month, and Novavax’s, of which it expects to make 60m-70m doses a month.

That was shortly after the Biden administration announced, on February 5, 2021, plans to use the Defense Production Act (DPA)—a law dating from the 1950s that grants the president broad industrial-mobilization powers—to bolster US vaccine-making. This legislation…has helped American pharmaceutical companies to secure a variety of special materials and equipment, including plastic tubing, raw goods, filters and even paper, that are needed for vaccine production. But firms which export such products point out that the DPA  hinders their ability to sell them abroad. They must seek permission before exporting these goods. That requires time and paperwork. And if the government decides it needs the goods in question to remain in the country, the firms concerned may be barred from exporting them at all… 

To be used in vaccine manufacturing, products have to be approved by regulators. So finding substitutes quickly can be impossible. SII is not alone in its concern. On March 24, 2021  Micheal Martin, Ireland’s prime minister, warned that export bans (and not just from America) would harm global vaccine production. He noted that the Pfizer vaccine involves 280 components from 86 suppliers in 19 countries. Indeed, American export controls particularly harm European vaccine companies, which need special bags from America in which to make their products. At a vaccine supply-chain meeting in March, one such firm complained of 66-week delivery times for the supply of these bags.

Excerpts from A Vaxxing Problem: Covid 19 and the Defense Production Act, Economist, Apr. 24, 2021

The Gung-Ho Way to Seize Space Real Estate

Elon Musk’s internet satellite venture has spawned an unlikely alliance of competitors, regulators and experts who say the billionaire is building a near-monopoly that is threatening space safety and the environment. The Starlink project, owned by Mr. Musk’s Space Exploration Technologies Corp. or SpaceX, is authorized to send some 12,000 satellites into orbit to beam superfast internet to every corner of the Earth. It has sought permission for another 30,000.

Now, rival companies such as Viasat,  OneWeb, Hughes Network Systems and Boeing Co. are challenging Starlink’s space race in front of regulators in the U.S. and Europe. Some complain that Mr. Musk’s satellites are blocking their own devices’ signals and have physically endangered their fleets. Mr. Musk’s endeavor is still in beta testing but it has already disrupted the industry, and even spurred the European Union to develop a rival space-based internet project to be unveiled by the end of the year.

The critics’ main argument is that Mr. Musk’s launch-first, upgrade-later principle, which made his Tesla Inc. TSLA electric car company a pioneer, gives priority to speed over quality, filling Earth’s already crowded orbit with satellites that may need fixing after they launch.

“SpaceX has a gung-ho approach to space,” said Chris McLaughlin, government affairs chief for rival OneWeb. “Every one of our satellites is like a Ford Focus—it does the same thing, it gets tested, it works—while Starlink satellites are like Teslas: They launch them and then they have to upgrade and fix them, or even replace them altogether,” Mr. McLaughlin said. Around 5% of the first batch of Starlink satellites failed, SpaceX said in 2019…. 

Orbital space is finite, and the current lack of universal regulation means companies can place satellites on a first-come, first-served basis. And Mr. Musk is on track to stake a claim for most of the free orbital real estate, largely because, unlike competitors, he owns his own rockets.

Excerpts from Bojan Pancevski, Elon Musk’s Satellite Internet Project Is Too Risky, Rivals Say, April 19, 2021

The Plastics Revolution: A Century Later

Businesses pay a fee to Tontoton,  a company established in 2019,  for every ton of plastic that they generate. Tontoton then uses the money to employ scavengers, who retrieve an equal weight of plastic garbage in Vietnam — the world’s No. 4 source of ocean debris…Tontoton said it has the only such program in Vietnam, while Plastic Bank runs a similar one in Indonesia and the Philippines, and the Plastic Collective covers Malaysia, Thailand, and Cambodia…Tontoton targets the worst ocean-bound rubbish, called orphan plastic because it cannot be recycled. Trash pickers find the single-use plastic along the cyan waters hugging Vietnam’s Phu Quoc and Hon Son islands. Their goal is to collect 5,000 tons a year and send it to INSEE, part of Siam City Cement, to be burned for energy….

These cleanup programs have sprung up globally as doubts emerge about recycling, which used to seem like a win-win idea because consumers could keep consuming and the environment could stay pristine. But instead, for decades, the public believed its plastic was being recycled, only to find that 91% of it was not, according to a study in the peer-reviewed journal Science Advances, assessing all plastic from 1950-2015.

Vietnam is a focus of cleanup campaigns because it’s among the top five countries sending litter to sea, along with China, Indonesia, the Philippines, and Thailand…These Asian countries earned this marker because they import so much waste for processing from the rest of the world.

Tontoton says clients sign a letter committing to multiple strategies beyond offsets, including plastic substitutes and reduction. The company helps them offset or “neutralize” plastic already used, but this isn’t a “getaway car” to escape broader responsibility. “Plastic neutralization cannot solve the problem by itself.”

Excerpt from LIEN HOANG, Vietnam tests waters for plastic credits to fight marine pollution, April 15, 2021

Wild West: Mercury Pollution in the Amazon Rainforest

Munduruku Indigenous people in the Tapajós basin – an epicenter of illegal gold mining in the Amazon rainforest – in southwestern Pará state have reported increasing encroachments upon their lands by armed “wildcat” miners known as “garimpeiros” since March 14, 2021. The Federal Prosecutor’s Office has warned of a potential for violence between local residents and the miners and urged the deployment of the federal police and other authorities to remove the trespassers. But the government has yet to act. The tension has escalated in recent weeks after a group of miners brought equipment to the area.

Illegal mining causes significant deforestation in the Brazilian Amazon and has been linked to dangerous levels of mercury poisoning, from mercury widely used to process the gold, in several Munduruku communities along the Tapajós basin. Indigenous people also fear that miners could spread the Covid-19 virus in their communities.

In a public statement on March 16, 2021 the Federal Prosecutor’s Office reported that a helicopter appeared to have escorted the miners and their equipment, suggesting the invasion is “an orchestrated action” by an organized crime group. The office also reported that the miners may be coordinating the invasion with a “small group” of Indigenous people who support the mining. Members of Munduruku communities who oppose the mining and have reported the invasions to the authorities say they have faced threats and intimidation. On March 19, 2021 armed men reportedly prevented a group of Munduruku Indigenous people from disembarking from their boats in an area within their territory. On March 25, 2021 in the Jacareacanga municipality, miners and their supporters forced their way into a building that houses the Wakoborun Women’s Association and other community organizations that have opposed the mining. The attackers destroyed furniture and equipment and set fire to documents, Indigenous leaders reported…

President Bolsonaro has signaled his aversion to protecting Indigenous lands. As a candidate, he vowed not to designate “one more centimeter” of land as Indigenous territory. His administration has halted the demarcation of Indigenous territories – there are 237 pending requests – leaving Indigenous communities even more vulnerable to encroachments, deforestation, and violence. The Munduruku territory is already demarcated. In 2020, Bolsonaro introduced a draft bill in Congress to allow mining and other commercial activities in Indigenous territories. The bill is pending in Congress and is listed as one of Bolsonaro’s priorities.

Excerpt from Brazil: Remove Miners from Indigenous Amazon Territory, Human Rights Watch, Apr. 12, 2021

Shallow Your Tongue: The Giddy Western Plutocracy of Hong Kong

You might think the death of liberalism in Asia’s financial center, Hong Kong, which hosts $10trn of cross-border investments, would trigger panic, capital flight and a business exodus. Instead Hong Kong is enjoying a financial boom. Share offerings have soared as China’s leading companies list there. Western firms are in the thick of it: the top underwriters are Morgan Stanley and Goldman Sachs. In 2020, the value of us dollar payments cleared in Hong Kong, a hub for the world’s reserve currency, hit a record $11trn.

The same pattern of political oppression and commercial effervescence is to be found on the mainland…Yet when they talk to shareholders about China, global firms gloss over this brutal reality: “Very happy,” says Siemens; “Phenomenal,” reckons Apple; and “Remarkable,” says Starbucks…Tougher policing does not affect Westerners, says a mainland financier. His foreign clients in Hong Kong laugh about the anxious memos they receive from bosses at home, asking about political developments. “It doesn’t really affect their life, right? They’re not going on the street to try to demonstrate against the government.”

Mainland China attracted $163bn of fresh multinational investment in 2020, more than any other country. It is opening the mainland capital markets to foreigners, who have invested $900bn, in a landmark shift for global finance.

Moreover, the pull China exerts is no longer just a matter of size—although, with 18% of world GDP, it has that too. The country is also where firms discover consumer trends and innovations. It is increasingly where commodity prices and the cost of capital are set, and is becoming a source of regulations. Business is betting that, in Hong Kong and the mainland, China’s… government is capable of self-restraint in the commercial sphere, providing contractual certainty, despite the lack of fully independent courts and free speech. Though China’s best-known tycoon, Jack Ma, has fallen from political favor, foreign investors’ stakes in his empire are still worth over $500bn.

Excerpts from Dealing with China, The Way its Going to Be, Economist, Mar 20, 2021 

So You Want a Job? De-Humanizing the Hiring Process

Dr. Lee, chairman and chief executive of venture-capital firm Sinovation Ventures and author of “AI Superpowers: China, Silicon Valley and the New World Order,” maintains that AI “will wipe out a huge portion of work as we’ve known it.” He hit on that theme when he spoke at The Wall Street Journal’s virtual CIO Network summit.

Artificial intelligence (AI) (i.e., robots), according to Dr. Lee, can be used for recruiting…We can have a lot of résumés coming in, and we want to match those résumés with job descriptions and route them to the right managers. If you’re thinking about AI computer and video interaction, there are products you can deploy to screen candidates. For example, AI can have a conversation with the person, via videoconference. And then AI would grade the people based on their answers to your questions that are preprogrammed, as well as your micro-expressions and facial expressions, to reflect whether you possess the right IQ and EQ (emotional intelligence) for a particular job.

Excerpts from Jared Council , AI’s Impact on Businesses—and Jobs, WSJ,  Mar. 8, 2021

The Fake Green Labels Lulling Our Conscience

Certification is a verification process through which an owner of a farm, a fishery or a forest can indicate they comply with social or environmental standards, and earn the right to sell their products as certified. Certified products often include consumer-facing ecolabels. Companies producing or trading “forest and ecosystem-risk commodities” often rely on certification to reassure customers. They want to show that they or their suppliers have taken action to minimize the negative environmental and social impacts linked to production, so their products can be considered ‘sustainable’.

According to a Greenpeace report, while some certification schemes have strong standards, weak implementation combined with a lack of transparency and product traceability means even these schemes have major failings. Too many certified companies continue to be linked to forest and ecosystem destruction, land disputes and human rights abuses. Currently, certification enables destructive businesses to continue operating as usual. By improving the image of forest and ecosystem risk commodities and so stimulating demand, certification risks actually increasing the harm caused by the expansion of commodity production. Certification schemes thus end up greenwashing products linked to deforestation, ecosystem destruction and rights abuses.

Excerpt from Certification schemes such as FSC (Forest Stewardship Council) are greenwashing forest destruction, Greenpeace Press release, Mar. 10, 2021

How the Global Trade in Plastics Spills Over the Oceans

Low-value or “residual” plastics – those left over after more valuable plastic is recovered for recycling – are most likely to end up as pollution. So how does this happen? In Southeast Asia, often only registered recyclers are allowed to import plastic waste. But due to high volumes, registered recyclers typically on-sell plastic bales to informal processors…When plastic types were considered low value, informal processors frequently dumped them at uncontrolled landfills or into waterways.

Plastics stockpiled outdoors can be blown into the environment, including the ocean. Burning the plastic releases toxic smoke, causing harm to human health and the environment. When informal processing facilities wash plastics, small pieces end up in wastewater, which is discharged directly into waterways, and ultimately, the ocean.

The price of many recycled plastics has crashed in recent years due to oversupply, import restrictions and falling oil prices, (amplified by the COVID-19 pandemic). However clean bales of (polyethylene terephthalate) PET and (high-density polyethylene) HDPE are still in demand. In Australia, material recovery facilities currently sort PET and HDPE into separate bales. But small contaminants of other materials (such as caps and plastic labels) remain, making it harder to recycle into high quality new products. Before the price of many recycled plastics dropped, Australia baled and traded all other resin types together as “mixed plastics”. But the price for mixed plastics has fallen to zero and they’re now largely stockpiled or landfilled in Australia.

Excerpts from Monique Retamal et al., Why Your Recycled Plastic May End up in the Ocean, the Maritime Executive, Mar. 8, 2021

The Techno-spheres: Westerners against the Chinese

Lithuania’s government on Feb. 17 prohibited Chinese security-scanner maker Nuctech Co. from supplying equipment to the country’s two airports, saying a proposed deal was “not in line with national-security interests.” State-controlled Nuctech, which the U.S. government in December 2020 listed among Chinese entities banned from certain transactions with U.S. parties, had won a tender launched a year ago by state-owned Lithuanian Airports.

Canada last year also abandoned a plan to buy Nuctech scanners for its embassies following controversy around the announced deal. Norway, Croatia and an EU directorate in recent months have also stopped scanner tenders involving Nuctech, although none publicly linked the cancellations to security, as Lithuania did. Lithuania banned China’s Nuctech from supplying security-scanning equipment to its two airports.

“We are choosing the Western technosphere. We are not choosing the Chinese technosphere,” said Laurynas Kasciunas, chairman of the Lithuanian parliament’s national-security and defense committee, which oversees a national-security review board that had recommended banning Nuctech. Such policy reversals remain a minority amid extensive Chinese business activity across the EU. 

Excerpt from Daniel Michaels and Valentina Pop, China Faces European Obstacles as Some Countries Heed U.S. Pressure, WSJ, Feb. 23, 2021

Green-Shaming ExxonMobil

ExxonMobil’s shareholders concerned about greenery are angered by ExxonMobil’s continued carbon-cuddling. Those who care more about greenbacks are irked by its capital indiscipline. Right now, both are pushing in the same direction.

D.E. Shaw, a big hedge fund, is urging ExxonMobil to spend more wisely… More eye-catchingly, Engine No.1, a newish fund with a stake of just 0.02%, is trying to green-shame Mr Woods with a mantra as straightforward as ExxonMobil’s: if the company continues on its current course, and demand shifts quickly to cleaner energy, it risks terminal decline. The fund has launched a proxy battle by proposing four new directors; the current board, it complains, is long on blue-chip corporate credentials but short on energy expertise. Engine No.1’s agitation for a shake-up has won backing from, among others, Calstrs, which manages $283bn on behalf of California’s public-sector workers.

Most important, the tone from ExxonMobil’s three biggest institutional shareholders—BlackRock, Vanguard and State Street—has also shifted…In a recent letter to clients, Larry Fink, boss of BlackRock, talked of greener stocks enjoying a “sustainability premium” and dirty ones jeopardising portfolios’ long-term returns. He hinted that his firm—the world’s largest asset manager—might divest from firms that failed to appreciate the “tectonic shift” taking place. Vanguard, too, has called out ExxonMobil for flawed governance…

Excerpt from Schumpeter: The Long Squeeze, Economist, Feb. 6, 2021

Designers Not Doers: Who’s Gonna Save the Chip Industry?

Although designing chips for electronic devices is now easier than ever, making them has never been harder requiring spending vast—and growing—sums on factories (called fabs) stuffed with ultra-advanced equipment.

At the turn of the millennium, a cutting-edge factory might have cost $1bn… More recently, a TSMC factory that produces 3 nm (nanometer) chips, completed in 2020, in southern Taiwan, cost $19.5bn. The firm is already pondering another for factory for 2nm chips, which will almost certainly be more. ..Asia’s nanoscale manufacturing duopoly remains fiercely competitive, as Samsung and TSMC keep each other on their toes… At some point, one company, in all likelihood TSMC, could be the last advanced fab standing. For years, says an industry veteran, tech bosses mostly ignored the problem in the hope it would go away. It has not…

The other big industry rupture is taking place in China. As America has lost ground in making chips, it has sought to ensure that China lags behind, too. The American tech embargo began as a narrow effort against Huawei over national security, but bans and restrictions now affect at least 60 firms, including many involved in chips. SMIC, China’s chip champion, has just been put on a blacklist, as has Xiaomi, a smartphone firm.

Excerpts from Betting All Chips, Economist, Jan. 23, 2021 and Semiconductors: A New Architecture, Economist, Jan. 23, 2021

Natural Capital and Human Well-Being

What is the contribution of nature to the economy?… The breathable air, drinkable water and tolerable temperatures that allow humans to do everything they do, and the complex ecosystems that maintain them, tend to be taken for granted. Professor Dasgupta’s review on the Economics of Biodiversity does not seek to play on the heartstrings with tales of starving polar bears. Rather, it makes the hard-headed case that services provided by nature are an indispensable input to economic activity. Some of these services are relatively easy to discern: fish stocks, say, in the open ocean. Others are far less visible: such as the complex ecosystems within soil that recycle nutrients, purify water and absorb atmospheric carbon. These are unfamiliar topics for economists, so the review seeks to provide a “grammar” through which they can be analysed.

The report features its own illustrative production function, which includes nature. The environment appears once as a source of flows of extractable resources (like fish or timber). But it also shows up more broadly as a stock of “natural” capital. The inclusion of natural capital enables an analysis of the sustainability of current rates of economic growth. As people produce GDP, they extract resources from nature and dump waste back into it. If this extraction and dumping exceeds nature’s capacity to repair itself, the stock of natural capital shrinks and with it the flow of valuable environmental services. Between 1992 and 2014, according to a report published by the UN, the value of produced capital (such as machines and buildings) roughly doubled and that of human capital (workers and their skills) rose by 13%, while the estimated value of natural capital declined by nearly 40%. The demands humans currently place on nature, in terms of resource extraction and the dumping of harmful waste, are roughly equivalent to the sustainable output of 1.6 Earths (of which, alas, there is only the one)…Indeed, Professor Dasgupta argues that economists should acknowledge that there are in fact limits to growth. As the efficiency with which we make use of Earth’s finite bounty is bounded (by the laws of physics), there is necessarily some maximum sustainable level of GDP…

Professor Dasgupta hints at this problem by appealing to the “sacredness” of nature, in addition to his mathematical models and analytical arguments.

Excerpts from How should economists think about biodiversity?, Economist, Feb. 6, 2021

At Gunpoint in Congo: Is Coltan Worse than Oil?

Tantalum, a metal used in smartphone and laptop batteries, is extracted from coltan ore. In 2019 40% of the world’s coltan was produced in the Democratic Republic of Congo, according to official data. More was sneaked into Rwanda and exported from there. Locals dig for the ore by hand in Congo’s eastern provinces, where more than 100 armed groups hide in the bush. Some mines are run by warlords who work with rogue members of the Congolese army to smuggle the coltan out.

When demand for electronics soared in the early 2000s, coltan went from being an obscure, semi-valuable ore to one of the world’s most sought-after minerals. Rebels fought over mines and hunted for new deposits. Soldiers forced locals to dig for it at gunpoint. Foreign money poured into Congo. Armed groups multiplied, eager for a share.

Then, in 2010, a clause in America’s Dodd-Frank Act forced American firms to audit their supply chains. The aim was to ensure they were not using minerals such as coltan, gold and tin that were funding Congo’s protracted war. For six months mines in eastern Congo were closed, as the authorities grappled with the new rules. Even when they reopened, big companies, such as Intel and Apple, shied away from Congo’s coltan, fearing a bad press.

The “Obama law”, as the Congolese nickname Dodd-Frank, did reduce cash flows to armed groups. But it also put thousands of innocent people out of work. A scheme to trace supply chains known as ITSCI run by the International Tin Association based in London and an American charity, Pact, helped bring tentative buyers back to Congo.  ITSCI staff turn up at mining sites to see if armed men are hanging about, pocketing profits. They check that no children are working in the pits. If a mine is considered safe and conflict-free, government agents at the sites put tags onto the sacks of minerals. However, some unscrupulous agents sell tags on the black market, to stick on coltan from other mines. “The agents are our brothers,” Martin says. It is hard to police such a violent, hilly region with so few roads. Mines are reached by foot or motorbike along winding, muddy paths.

For a long time those who preferred to export their coltan legally had to work with itsci, which held the only key to the international market. Miners groaned that itsci charged too much: roughly 5% of the value of tagged coltan. When another scheme called “Better Sourcing” emerged, Congo’s biggest coltan exporter, Société Minière de Bisunzu, signed up to it instead.

Excerpts from Smugglers’ paradise: Congo, Economist, Jan. 23, 2021

Who Will Rule the Arctic?


Rosatom joined the Arctic Economic Council*in February 2021. Rosatom is a Russian state-owned corporation supplying about 20% of the country’s electricity. The corporation mainly holds assets in nuclear power and machine engineering and construction. In 2018, the Russian government appointed Rosatom to manage the Northern Sea Route (NSR). The NSR grants direct access to the Arctic, a region of increasing importance for Russia due to its abundance of fossil fuels. Moreover, due to climate changes, the extraction of natural resources, oil and gas are easier than ever before.

Since Russia’s handover of NSR’s management, Rosatom’s emphasis on the use of nuclear power for shipping, infrastructure development and fossil fuel extraction is likely to become more prevalent in the Arctic region. Rosatom already operate the world’s first floating nuclear power plant in the Siberian port of Pevek and is the only company in the world operating a fleet of civilian nuclear-powered icebreakers…The company has numerous plans up its sleeves, among them to expand the fleet of heavy-duty nuclear icebreakers to a minimum of nine by 2035.

*Other members of the Arctic Economic Council.

Excerpt from Polina Leganger Bronder, Rosatom joins Arctic Economic Council, BarentsObserver, Feb. 8, 2021

Living in the World of Tesla: Cobalt, Congo and China

 A 20% rise in the price of cobalt since the beginning of 2021 shows how the rush to build more electric vehicles is stressing global supply chains. 

A majority of the world’s cobalt is mined in the Democratic Republic of the Congo in central Africa. It typically is carried overland to South Africa, shipped out from the port of Durban, South Africa, and processed in China before the material goes to battery makers—meaning the supply chain has several choke points that make it vulnerable to disruption…

Car and battery makers have been looking for more control over their cobalt supply and ways to avoid the metal altogether. Honda Motor Co. last year formed an alliance with a leading Chinese car-battery maker, Contemporary Amperex Technology Ltd. , hoping that CATL’s supply-chain clout would help stabilize Honda’s battery supply..

Meanwhile, China plays a critical role even though it doesn’t have significant reserves of cobalt itself. Chinese companies control more than 40% of Congo’s cobalt-mining capacity, according to an estimate by Roskill, the London research firm…China’s ambassador to Congo was quoted in state media last year as saying more than 80 Chinese enterprises have invested in Congo and created nearly 50,000 local jobs…

To break China’s stronghold, auto makers and suppliers are trying to recycle more cobalt from old batteries and exploring other nations for alternative supplies of the material.  Another reason to look for alternatives is instability in Congo and continuing ethical concerns about miners working in sometimes-harsh conditions with rudimentary tools and no safety equipment.

Excerpt from Yang Jie, EV Surge Sends Cobalt Prices Soaring, WSJ, Jan. 23, 2021

A Lethal Combination: Pentagon and NASA

U.S. government and aerospace-industry officials are removing decades-old barriers between civilian and military space projects, in response to escalating foreign threats beyond the atmosphere. The Pentagon and the National Aeronautics and Space Administration (NASA) are joining forces to tackle efforts such as exploring the region around the moon and extending the life of satellites. Many details are still developing or remain classified.  Driving the changes are actions by Moscow and Beijing to challenge American space interests with antisatellite weapons, jamming capabilities and other potentially hostile technology. Eventually, according to government and industry officials briefed on the matter, civil-military cooperation is expected to extend to defending planned NASA bases on the lunar surface, as well as protecting U.S. commercial operations envisioned to extract water or minerals there…

Large and small contractors are maneuvering to take advantage of opportunities to merge military and nonmilitary technologies. They include established military suppliers that already have a foot in both camps, such as Northrop Grumman,  the Dynetics unit of Leidos Holdings, and Elon Musk’s Space Exploration Technologies Corp. Smaller companies such as Maxar Technologies Holdings,  closely held robotic-lander maker Astrobotic Technology, and small-satellite producer Blue Canyon Technologies, recently acquired by Raytheon Technologies, also seek to diversify in the same way…

The U.S. astronaut corps always has included many military officers, some previous NASA scientists quietly shared data with military counterparts and NASA’s now-retired Space Shuttle fleet was supposed to launch Pentagon satellites. But today, veteran industry and government experts describe the cooperation as much more extensive, covering burgeoning capabilities such as repairing and repurposing satellites in orbit, or moving them around with nuclear propulsion. Intelligence agencies are more involved than ever in leveraging civilian technology, including artificial intelligence, robotic capabilities and production know-how.

Excerpt from Pentagon, NASA Knock Down Barriers Impeding Joint Space Projects, WSJ, Feb. 1, 2021

The New Lepers: Oil in Ecuador and Arctic Drilling

Some of Europe’s largest banks are phasing out trading services for the export of oil from the Ecuadorean Amazon, a move that reflects the growing focus of global banks on climate change and their shift away from increasingly risky fossil fuels.

On January 25, 2021, Switzerland’s Credit Suisse Group AG and Holland’s ING said that they were excluding new transactions related to exports of Ecuador’s Amazonian oil from their trading activities, citing climate change and concerns for the Amazon rainforest and its Indigenous people. France’s BNP Paribas SA, the largest bank in the eurozone and one of the region’s trading powerhouses, said in December 2020 that it would immediately exclude from its trading activities the seaborne exports of oil from the Esmeraldas region in Ecuador under its latest environmental finance policies.

Ecuador isn’t one of the world’s top oil producers, but petroleum exports are a key contributor to the country’s economy. Petroecuador, the nation’s state-owned oil company, didn’t respond to requests for comment.  The banks’ flight from Amazonian crude follows last year’s crash in oil prices and growing fears of so-called stranded assets, which are fossil fuels that lose value due to the world’s transition to cleaner forms of energy…

Banks are also facing calls from environmentalists and Indigenous peoples to limit their involvement in fossil fuels. In Ecuador, a campaign by activists and Indigenous people spurred ING and Credit Suisse to reduce their exposure to the Amazonian oil trade. The nonprofits Stand.earth and Amazon Watch published a report in 2020 that called out banks—including ING, Credit Suisse and BNP Paribas—for their financing of Amazonian crude…

Banks and insurers are also cutting ties with Arctic oil drilling. This month, Axis Capital Holdings joined fellow insurers AXA and Swiss Re in pledging not to underwrite any new oil-and-gas drilling in the Arctic Wildlife Refuge in Alaska.  The six biggest U.S. banks— Citigroup Inc., Bank of America Corp. , Goldman Sachs Group Inc., JPMorgan Chase & Co., Morgan Stanley and Wells Fargo & Co.—have also said they would end funding for new drilling and exploration projects in the Arctic.

Excerpts from Dieter Holger & Pietro Lombardi, European Banks Quit Ecuador’s Amazonian Oil Trade, WSJ, Jan. 25, 2021

The Struggle of Managing Dis-Used Nuclear Sources

Two disused radioactive sources, previously employed in cancer treatment, are now in safe and secure storage in the Republic of the Congo, following successful transport and increased security at their temporary storage facility, with the support of the IAEA. The sources no longer emit enough radioactivity to be useful for radiotherapy but are still radioactive and therefore need to be controlled and managed safely and securely. They are expected to be exported outside the country in 2022.

“It took time to understand the risks posed by the disused radiotherapy sources stored for so long in our country…,” said Martin Parfait Aimé Coussoud-Mavoungou, Minister for Scientific Research and Technological Innovation.

Around the world, radioactive material is routinely used to diagnose and treat diseases… This material is typically managed safely and securely while in use; however, when it reaches the end of its useful lifespan, the risk of abandonment, loss or malicious acts grows. 

In 2010, the University Hospital of Brazzaville received a new cobalt 60 (Co-60) sealed source for the hospital’s teletherapy machine, replacing its original source, which was no longer able to deliver effective treatment. The disused sealed source was then packaged and shipped by boat to the supplier. However, the delivery of the package was blocked in transit due to problems with the shipping documents and was returned to the Republic of the Congo. Since 2010, the Co-60 source has been stored at the Autonomous Port of Pointe Noire, one of the most important commercial harbors in Central Africa…

“The August 2020 explosion that occurred in Beirut Harbor reminded the Congolese Authorities of the risks to unmanaged or unregulated material, particularly in national ports and harbors,” said Coussoud-Mavoungou. Congolese decision-makers agreed that the disused source had to urgently leave the Autonomous Port of Pointe Noire.

Following a comprehensive planning and preparation phase, a transport security plan was finalized on location in November 2020, with the support of IAEA experts. They designed a security system for the package and conducted a pre-shipment verification and simulation. At the same time, 45 participants were trained from the five government Ministries involved in the transport by road of the source in Pointe Noire.

Excerpts from Security of Radioactive Sources Enhanced by the Republic of the Congo with Assistance from the IAEA, IAEA Press Release, Jan. 18, 2021

Assigning Responsibility for Oil Leaks: Shell’s Deep Pockets

Royal Dutch Shell’s  Nigerian subsidiary has been ordered on January 29, 2021 by a Dutch court to pay compensation for oil spills in two villages in Nigeria…The case was first lodged in 2008 by four Nigerian farmers and Friends of the Earth Netherlands. They had accused Shell and its Nigerian subsidiary of polluting fields and fish ponds through pipe leaks in the villages of Oruma and Goi.

The Court of Appeal in the Hague, where Shell has its headquarters, also ordered the company to install equipment to safeguard against future pipeline leaks. The amount of compensation payable related to the leaks, which occurred between 2004 and 2007, is yet to be determined by the court.  The case establishes a duty of care for the parent company to play a role in the pollution abroad, in this case by having the duty to make sure there is a leak-detection system…

Shell argued that the leaks were caused by sabotage…

In recent years there have been several cases in U.K. courts related to whether claimants can take matters to a parent company’s jurisdiction. In 2019, the U.K. Supreme Court ruled that a case concerning pollution brought by a Zambian community against Vedanta, an Indian copper-mining company previously listed in the U.K., could be heard by English courts. “It established that a parent company can be liable for the actions of the subsidiary depending on the facts,” said Martyn Day, partner at law firm Leigh Day, which represented the Zambians.

The January 2021 case isn’t the first legal action Shell has faced related to pollution in Nigeria. In 2014, the company settled a case with over 15,000 Nigerians involved in the fishing industry who said they were affected by two oil spills, after claims were made to the U.K. High Court. Four months before the case was due to go to trial Shell, which has its primary stock-exchange listing in the U.K., agreed to pay 55 million British pounds, equivalent to $76 million…  

The January 2021  verdict tells oil majors that “when things go wrong they will be held to account and very likely held to account where their parent company is based,” said Mr. Day, adding that the ruling could spark more such actions.

Excerpts from Sarah McFarlane, Shell Ordered to Pay Compensation Over Nigerian Oil Spills, WSJ, Jan. 29, 2021

How Germany and China Saved the World from Fossil Fuels

In 2020, 132bn watts of new solar generating capacity were installed around the world; in many places solar panels are now by far the cheapest way to produce electricity. This transformation… was the result of a decisive shift in German government policy happening to coincide with China becoming the dominant force in global manufacturing.

By 2012 Germany had paid out more than €200bn in subsidies for solar energy production. It had also changed the world. Between 2004 and 2010 the global market for solar panels grew 30-fold as investors in Germany and the other countries which followed its lead piled in… By 2012 the price of a panel was a sixth what it had been in 2004, and it has gone on falling ever since… In sunny places new solar-power installations are significantly cheaper than generating electricity from fossil fuels. Installed capacity is now 776gw, more than 100 times what it was in 2004.

That does not mean Germany got exactly what it wanted. Solar power is not the decentralised, communal source of self-sufficient energy the Greens dreamed of; its provision is dominated by large industrial installations. And the panels on those installations are not made by the German companies the Social Democrats wanted to support: Chinese manufacturers trounced them…But they do provide the world with a zero-carbon energy source cheaper than fossil fuels, and there is room for many more of them…

The industry boasts no giants comparable to those in aircraft manufacture or pharmaceuticals, let alone computing; no solar company has a market capitalization of more than $10bn, and no solar CEO is in danger of being recognized on the street. It is a commodity business in which the commodity’s price moves in only one direction and everyone works on very thin margins. Good for the planet—but hardly a gold mine. 

Excerpt from How governments spurred the rise of solar power, Economist Technology Quarterly, Jan 9, 2021 

The Geo-Economics of Rare Earth Minerals

Greenland is rich in rare-earth minerals, and the superpowers want them…These 17 elements are used in  all things electronic. The renewable-energy revolution will also rely on them for power storage and transmission. On the darker side, weapons—including nuclear ones—need them too.

A new open-pit mine at the top of Kuannersuit, a cloud-rimmed mountain near the settlement of Narsaq in the south of Greenland may be rich in rare earth. So believes Greenland Minerals, an Australia-based company, which has been angling for the excavation rights for the past decade.

Greenland’s environment ministry has given a tentative go-ahead. A majority of parliamentarians have already declared themselves in favor of digging. In early February 2020, the townsfolk of Narsaq will hear representations from the island’s government. In Greenland, Urani Naamik (“No to Uranium”), a community lobby, has strong support. Nobody wants (mildly) radioactive dust, an inevitable by-product of mining. Many worry about the waste—a sludge of chemicals and discarded rock fragments—that mining would leave on top of the mountain.

The bigger long-term issue is who gets the mine’s spoils. Shenghe, a Chinese conglomerate, is the largest shareholder in Greenland Minerals. The Danish government, in a frenzy of Atlanticism, earlier managed to stop Chinese companies from investing in the expansion of two airports on the island. Will it preserve Greenland’s rare earths for NATO?

Cloud mining: In search of Greenland’s rare earths, Economist, Jan. 16, 2021, at 41

De-Junking the Space and Saving the Commons

The part of space nearest Earth, known technically as low-Earth orbit, is getting cluttered. Some of the objects up there are working satellites. Some are satellites that have stopped working. Some are stages of the rockets which put those satellites into orbit. And a lot are debris left over from explosions and collisions between larger objects.

The risk of such collisions is increasing, for two reasons. First, the number of satellites being launched is rising. Second, collisions themselves beget collisions. The fragments they create add to the number of orbiting objects. At the moment, more than 20,000 such objects are being tracked, but there may be as many as 1million bigger than 1cm across. In the long term, this accumulation of junk may lead to a chain reaction, known as Kessler syndrome, that would make some low-Earth orbits unusable. Even in the short term it puts lots of expensive hardware at risk. So plans are being laid to send up special craft to “deorbit” redundant satellites and rocket stages. Given the current situation, this is a good, if expensive, idea. But a better one for the future would be to build deorbiting into the life-cycles of satellites and rocket stages from the beginning.

There are several ways of doing this. One is a “launch tax”. But that would load costs onto the satellite industry…A second idea is a space-going “bottle deposit” scheme. Satellite owners would pay an agreed sum into an escrow account that was redeemable when they deorbited their property. If they did not do so, enterprising salvagers could try to do it for them, and claim the deposit if successful. This has the virtue of encouraging built-in deorbiting capability….

The best idea, though, is to attack the problem at its roots. The littering of space is an example of the “tragedy of the commons”, in which no charge is made for the use of a resource that is owned collectively. So why not charge the beneficiaries for the right to put something into orbit and keep it there? The longer an object stays up, the more the satellite owner pays. The more popular (and hence crowded) the orbit chosen, the more expensive it would be to add a satellite to it.

That raises the question of who would do the charging. The Outer Space Treaty, signed in 1967, assigns responsibility and liability for objects in orbit to the country which launches them, and entreats signatories to avoid harmful contamination of space and celestial bodies.  It would make sense for countries with space-launch capability, and thus an interest in keeping space clean, to hammer out a new and specific agreement. A well-crafted treaty would clean up space, cause it to be used more efficiently, and raise some useful revenue from a resource currently exploited for nothing.

To deal with non-participants acting as free-riders, participants might agree to make pariahs of firms that tried to take advantage in this way… Other natural commons, notably the oceans and the atmosphere, have suffered, and still suffer, from a lack of sensible arrangements for their joint exploitation. It is not too late to stop outer space being added to that list.

Excerpt from Decluttering Low-Earth Orbit: New Brooms Needed, Economist, Jan. 16, 2020

Above-the-Speed-of Sound: US Hypersonic Weapons

From the DARPA Website: DARPA’s Operational Fires (OpFires) program, which is developing a ground-launched intermediate-range hypersonic weapons system, is advancing to a new phase. This new phase involves full-scale missile fabrication, assembly, and flight testing from a launch vehicle. It will be  be produced by Lockheed Martin Missiles and Fire Control…OpFires aims to demonstrate a novel system enabling hypersonic boost glide weapons to rapidly and precisely hit critical, time-sensitive targets while penetrating modern enemy air defenses. 

DARPA’s Operational Fires Ground-Launched Hypersonics Program Enters New Phase, Jan. 11, 2021

The Perils of Inhaling Lead Dust: Zambia

Kabwe,  in Zambia,  sprung up around a mine founded in 1904 by the Rhodesian Broken Hill Development Company, a British colonial firm. For decades miners crushed and burnt ore to extract lead. That metal made Kabwe but it also devastated it. To this day lead particles blow across town, making their way into houses and bloodstreams.

Scientists generally consider soil hazardous if it has more than 400mg of lead per kilogram. In three townships near the old mine the soil contains six, eight and 15 times that amount, according to analysis in 2014 by Pure Earth, an environmental ngo. “Kabwe is the most toxic place I’ve ever been to,” says Richard Fuller, its president…

The pollution in Kabwe is a scandal. Yet responsibility for it has long been contested, and that is set to continue. In October 2020, Mbuyisa Moleele Attorneys, a South African law firm, with help from Leigh Day, a British one, announced a class-action lawsuit against a subsidiary of Anglo American on behalf of potentially more than 100,000 children and women of reproductive age in Kabwe. It is targeting Anglo because it was affiliated to the mine from the 1920s until shortly after Zambia’s mines were nationalised in 1970. The suit claims that most of the pollution stems from the period when the mine was under the de facto control of Anglo, which allegedly did not do enough to stop the harm. Anglo rejects the claims, arguing that its involvement ended five decades ago and that, before then, it was neither the operator nor a majority shareholder in the mine and thus not responsible.

The case may take years. The lawyers for the plaintiffs must first convince a South African court to take it on. Only then may it proceed to a trial. Meanwhile children in Kabwe will keep on playing in the dust.

The World Bank included Kabwe in a broader project it funded to clean up Zambian mines. The scheme, which ran from 2003-2011, had some successes. It dredged a toxic canal and buried some contaminated soil. But it did not treat the main source of the dust—the former mine and dumps—and it left roads unpaved and most houses untreated…Another clean-up funded by the bank was started in December 2016. But it, too, is struggling. Some children have been tested and have received therapy to reduce blood lead levels. But since little has been done about the lead in the environment there is a risk their levels will rise again. 

Excerpt from Mining’s Toxic Legacy: Lead Astray, Economist,  Dec. 12, 2020

Satellites Shed Light on Modern Slavery in Fishing

While forced labor, a form of modern slavery, in the world’s fishing fleet has been widely documented, its extent remains unknown. No methods previously existed for remotely identifying individual fishing vessels potentially engaged in these abuses on a global scale. By combining expertise from human rights practitioners and satellite vessel monitoring data, scientists have showed in an recent study that vessels reported to use forced labor behave in systematically different ways from other vessels. Scientists used machine learning to identify high-risk vessels from among 16,000 industrial longliner, squid jigger, and trawler fishing vessels.

The study concluded that 14% and 26% of vessels were high-risk. It also revealed patterns of where these vessels fished and which ports they visited. Between 57,000 and 100,000 individuals worked on these vessels, many of whom may have been forced labor victims. This information provides unprecedented opportunities for novel interventions to combat this humanitarian tragedy….

The study found, inter alia, that longliners and trawlers using forced labor travel further from port and shore, fish more hours per day than other vessels, and have fewer voyages and longer voyage durations…  Taiwanese longliners, Chinese squid jiggers, and Chinese, Japanese, and South Korean longliners are consistently the five fisheries with the largest number of unique high-risk vessels. This pattern is consistent with reports on the abuses seen within distant water fleets that receive little legal oversight and often use marginalized migrant workers .

Excerpts from Gavin G. McDonald et, al, Satellites can reveal global extent of forced labor in the world’s fishing fleet, Dec. 21, 2020

Netherlands, China and Mexico: Lethal Narco-States

The setup—Mexican cooks using Dutch equipment to process chemicals from China—offered a window into the new global drug economy…Mexican cartels, which dominate drug trafficking in North America, are drawn to the Netherlands because it is a global trade nexus with sea and rail links to Asia that has long been Europe’s top manufacturer of synthetic drugs.

Piggybacking legitimate commercial channels, Mexican cartels are combining sophistication with ruthlessness to expand their reach world-wide. Their multinational drive is enabled by the advent over recent decades of highly potent synthetic drugs that don’t rely on crops or farmers and can be manufactured in compact facilities almost anywhere. Production experts instant-message instructions to overseas workers and hop the globe like factory troubleshooters in any industry.

With the U.S. drug market saturated and methamphetamine labs in Mexico already supersize, cartels that murder for market share see Europe as a new hub. The cartels are “like global corporations,” said DEA Regional Director for Europe Daniel Dodds. “If they can expand and broaden their customer base, they will.”

Mexican cartels first connected with Dutch drug smugglers in the 1990s, bringing cocaine through Rotterdam, Europe’s largest port. Cocaine remains Europe’s top illicit stimulant, but Dutch police say over the past two years surging quantities of Mexican meth have hit the Netherlands, Mexican “cooks” have arrived to teach local chemists, and Dutch technicians are honing production methods.

The Netherlands offers Mexican cartels an ideal production base because of its experienced chemists, unrivaled cargo networks and liberal attitude to drugs. Connections to labs in China supply chemicals that constantly adapt to remain legal. Dutch traffickers cultivated those links over decades as they perfected ecstasy manufacturing for party scenes in London, Berlin and New York…

Dutch officials are awakening to the impact of tolerating drug use for a long time and “allowing for too long a parallel economy to grow and become more influential,” Mr. Struijs said. “We have the characteristics of a narco-state.”

Excerpts from Valentina Pop, Cartels Are Now Cooking Chinese Chemicals in Dutch Meth Labs, WSJ, Dec. 8, 2020

Surveillance for Conservation: the Smart Wildlife Parks in Africa

In 2010, Rwanda’s government partnered with international conservation group African Parks to manage the Akagera Park…African Parks, based in South Africa, is known for reviving troubled national parks. The nonprofit worked to strengthen Akagera’s security, brought in anti-poaching dogs, purchased better field equipment, and hired and trained more rangers. The number of patrols increased from about 1,500 in 2011 to more than 5,400 last year.

Since 2013, poaching has dropped dramatically, which led to a wildlife revival that once seemed inconceivable. In 2017 Akagera reintroduced 18 black rhinos from South Africa. In a conservation milestone, the first rhino calves were born in the park a year later. As for lions, seven were reintroduced to the park in 2015. Today there are at least 35 of them prowling Akagera’s highlands, grassy plains, and forests…The Howard Buffett Foundation even donated a helicopter to the Rwandan government for rhino patrols.

Fences, more patrols, and reintroductions are all part of the park-rehabilitation playbook, but Akagera is also using a distinctive new technology to help even the odds against poachers. In 2017, Akagera became the world’s first “Smart Park” when it tested and installed a telecommunications network called LoRaWAN, or Long Range Wide-Area Network for securely tracking and monitoring just about anything in the park. Poachers can potentially intercept the conventional radio signals parks use to track animals but the low-bandwidth LoRa signals are relayed on a private, closed network on various frequencies, making them harder to crack. The network also runs on solar energy and is cheaper than satellite tracking technology.

Akagera partnered with Dutch conservation technology group Smart Parks to install LoRa receivers on towers throughout the park. (Smart Parks is the result of a merger between the Shadow View Foundation and the Internet of Life.) LoRa sensors, which vary in size and can be small enough to fit in one’s hand, can then communicate with towers to track the location of rangers, vehicles, equipment, and more. In 2017 they collected more than 140,000 location updates per day. Next year the park plans to install 100 sensors to monitor tourist vehicles as well, says Hall.

Excerpt from AMY YEE , In Rwanda, Learning Whether a ‘Smart Park’ Can Help Both Wildlife and Tourism, Atlas Obscura, Nov. 24, 2020

When Shepherds are Wolves: States Culpability in Illegal Fishing

Ecuador portrays itself as a victim of illegal, unregulated and unreported (IUU) fishing by Chinese trawlers near the Galapagos islands. In fact, its fishing industry is just as bad…Since 2018 at least 136 large Ecuadorean fishing vessels have entered the Galapagos islands’ reserve, which covers 133,000 square km (51,000 square miles), says the director of the archipelago’s national park…

Many boats illegally transfer their catch on the high seas to larger vessels, which carry them to other markets. Under Ecuadorean law fishermen can sell endangered species like sharks or turtles if they catch them unintentionally. Some boats report half their catch as by-catch….The European Union, the biggest buyer of Ecuadorean tuna, has told the country to step up action against IUU or risk losing access to its market. In 2018 a committee within CITES, an international convention on trading in endangered species, recommended that its 183 members suspend trade in fish with Ecuador.

Its government is incapable of reining in a powerful industry. Fishing companies employ 100,000 people, and contribute $1.6bn a year, 1.5% of GDP to the economy. Ecuador’s tuna fleet, the largest in the eastern Pacific, has around 115 large mechanised ships. The rest of the fishing industry consists of more than 400 semi-industrial vessels and nodrizas, small boats with no machinery that catch a greater variety of fish…

Purse seine vessels and gear in this Google Earth image show the path of FADs belonging to just three vessels (typically vessels have about 100 FADs each) fishing in Central and Western Pacific (image from Parties to Nauru Agreement).

More controversial than purse seining and longlining is the use of fish aggregating devices (FADs). Industrial ships release these into the current that passes through the Galapagos islands’ protected area to attract prey, say green groups. Sometimes they fix goats’ heads on the devices to lure sharks, say Galapagans. Crews track them with GPS and surround them with nets when they leave the protected zones, entrapping turtles, sea lions, manta rays and sharks. Ecuadorean ships deploy more FADs than those of any other country, according to a study in 2015 by the Pew Charitable Trusts.

Excerpt from Piscine Plunder: Ecuador, a Victim of Illegal Fishing, is Also a Culprit, Economist, Nov. 21, 2020

Under-Water Data Centers: Reliable, Cool and Cheap

Earlier this year a ship hauled a large, barnacle-covered cylinder sporting a Microsoft logo from the seas off the Orkney islands. Inside were a dozen server racks, of the sort found in data-centres around the world. Sunk in 2018, and connected to the shore by cable, the computers had spent the past couple of years humming away, part of an experiment into the feasibility of building data-centres underwater.

On September 14th, 2020 Microsoft revealed some results. The aquatic data-centre suffered equipment failures at just one-eighth the rate of those built on land. Being inaccessible to humans, the firm could fill it with nitrogen instead of air, cutting down corrosion. The lack of human visitors also meant none of the bumping and jostling that can cause faults on land.

Microsoft hopes some of the lessons can be applied to existing, land-based data-centers. In the longer term, though, it notes that building underwater offers advantages beyond just reliability. Immersion in seawater helps with cooling, a big expense on land. Data-centres work best when placed close to customers. Land in New York or London is expensive, but nearby sea-floor is cheap. More than half the world’s population lives within 120 miles (192km) of the sea. Ben Cutler, the engineer in charge of the project, says submarine data-centres could be co-located with offshore wind farms as “anchor” customers. The cylinder fits in a standard shipping container, so could be deployed to remote places like islands, or even disaster areas to support relief efforts.

Excerpts from Cloud computing: Davy Jones’s data-center, Economist, Sept. 19, 2020

Banning Gasoline Cars: Better than subsidies and taxes

More than a dozen countries say they will prohibit sales of petrol-fueled cars by a certain date. On September 23rd, 2020,  Gavin Newsom, California’s governor, pledged to end sales of non-electric cars by 2035. Such bans may look like window-dressing, and that could yet in some instances prove to be the case. But in the right circumstances, they can be both effective and efficient at cutting carbon.

Fully electric vehicles are not yet a perfect substitute for petrol-consuming alternatives. They are often more expensive, depreciate faster, and have a lower range of travel and more limited supporting infrastructure, like charging stations or properly equipped mechanics. But the number of available electric models is growing, and performance gaps are closing. A recent analysis concludes that in such conditions—when electric vehicles are good but not perfect substitutes for petrol-guzzlers—a ban on the production of petrol-fueled cars is a much less inefficient way to reduce emissions than you might think.

If electric vehicles were in every way as satisfactory as alternatives, it would take little or no policy incentive to flip the market from petrol-powered cars to electric ones. If, on the other hand, electric cars were not a good substitute at all, the cost of pushing consumers towards battery-powered vehicles would not be worth the savings from reduced emissions. Somewhere in between those extremes, both electric and petrol-powered cars may continue to be produced in the absence of any emissions-reducing policy even though it would be preferable, given the costs of climate change, for the market to flip entirely from the old technology to the new. Ideally, the authors reckon, this inefficiency would be rectified by a carbon tax, which would induce a complete transition to electric vehicles. If a tax were politically impossible to implement, though, a production ban would achieve the same end only slightly less efficiently—at a loss of about 3% of the annual social cost of petrol-vehicle emissions, or about $19bn over 70 years… A shove may work as well as a nudge. 

Excerpts from Outright bans can sometimes be a good way to fight climate change, Economist, Oct. 3, 2020

To Steal To Survive: the Illegal Lumberjacks of the Amazon

The Amata logging company was supposed to represent an answer to the thorny problem of how countries like Brazil can take advantage of the Amazon rainforest without widespread deforestation.  But after spending tens of millions of dollars since 2010 to run a 178-square-mile concession in the rainforest to produce timber sustainably, Amata pulled out in April 2020. The reason: uncontrolled wildcat loggers who invaded Amata’s land, illegally toppling and stealing trees.

Amata’s executives in São Paulo said that instead of promoting and protecting legal businesses, Mr. Bolsonaro’s administration did next to nothing to control the illegal loggers who invaded the concession in the western state of Rondônia. “It’s a conflict area,” Amata Chief Executive Ana Bastos said of the land granted to the company. “Those lumberjacks steal our lumber to survive. If we try to stop them, they will fight back. It will be an eternal conflict.”

Since they pay no taxes and make no effort to protect certain species or invest in restoration, illegal loggers can charge $431 per square meter of lumber, compared with $1,511 per square meter of legally logged timber, concession operators said.  “It is like having a regular, taxpaying shop competing with lots of tax-free peddlers right in front of your door,” said Jonas Perutti, owner of Lumbering Industrial Madeflona Ltda., which also operates concessions in the Amazon…

“The organized crime that funds illegal activity in the Amazon—including deforestation, land grabbing, lumber theft and mining—remains strong and active,” said Carlos Nobre, a Brazilian climate scientist. “It seems [the criminals] aren’t frightened by the government’s zero-tolerance rhetoric or don’t believe it’s serious.”…

Wildcat loggers are among the Amazon’s poorest residents, and many feel they have an ally in Mr. Bolsonaro,[Brazil’s President]…“There’s much corruption in law enforcement, and consumers don’t care if the wood they are buying is legal or not,” said Oberdan Perondi, a co-owner of a concession that is five times as large as Amata’s and also competes with illegal loggers.

Excerpt from Paulo Trevisani and Juan Forer, Brazil Wanted to Harvest the Amazon Responsibly. Illicit Loggers Axed the Plan, WSJ, Oct. 28, 2020

The Unrepentant Banker: How Banks Rig the Markets

Many of the big market-manipulation scandals over the past decade have much in common: huge fines for the investment banks, criminal charges for the traders and an embarrassing paper trail revealing precisely what bank employees got up to. Interest-rate traders who manipulated the London Interbank Offered Rate (LIBOR)… infamously called a chat room in which they discussed rigging exchange rates “the cartel”.

The case against JPMorgan Chase for manipulating precious-metals and Treasury markets has many of the usual features. On September 29th, 2020 it admitted to wrongdoing in relation to the actions of employees who, authorities claim, fraudulently rigged markets tens of thousands of times in 2008-16. The bank agreed to pay $920m to settle various probes by regulators and law enforcement… Some of the traders involved face criminal charges. If convicted, they are likely to spend time in jail.

The traders are alleged to have used “spoofing”, a ruse where a market-maker seeking to buy or sell an asset, like gold or a bond, places a series of phony orders on the opposite side of the market in order to confuse other market participants and move the price in his favor. A trader trying to sell gold, for instance, might place a series of buy orders, creating the illusion of demand. This dupes others into pushing prices higher, permitting the trader to sell at an elevated price. Once accomplished, the trader cancels his fake orders… According to prosecutors one JPMorgan trader described the tactic as “a little razzle-dazzle to juke the algos”. In the past two years Deutsche Bank, HSBC, Merrill Lynch and UBS have all paid penalties on spoofing charges…

Excerpt from Spoof proof: JPMorgan Chase faces a fine of $920m for market manipulation, Economist, Oct. 3, 2020

Paper Parks, their Elephants and Marginal People

Since 2010 Chad has taken a step that other African countries are increasingly following. It handed management of its national park to an NGO. Since African Parks took over, the elephant population has begun to rise. In 2011 just one calf was born; in 2018, 127 were. The revival is emblematic of broader success that public-private partnerships (PPPs) are having in conserving some of the most precious parts of the planet.  Sixty years ago, when decolonization was sweeping the continent, the UN counted 3,773 “protected areas” in Africa and its surrounding waters. By 1990 the figure was 6,075; today it is 8,468. Some 14% of the continent’s land has been categorized as protected, according to the World Database on Protected Areas…

Most “protected areas” are “paper parks”, argues Peter Fearnhead, the chief executive of African Parks. In theory their demarcation denotes stewardship; in practice there is often very little care. Since its founding in 2000 the NGO has grown to manage 19 parks in 11 countries. It is the largest of an expanding number of ppp operators across the continent. The African Parks model relies on “three ms”, explains Mr Fearnhead: a clear mandate from a government (which keeps ownership of the area but hands over the running to the NGO); sound management; and money from donors such as the EU.

Zakouma is African Parks’ flagship operation. When it took over its management the priority was security. The national park was caught up in Chad’s civil conflicts in the 2000s, when rebel groups, some backed by Sudan, took on government forces. Janjaweed militias, notorious for mass murder and rape in Darfur, took advantage of the vacuum to slaughter Zakouma’s elephants and launch attacks on nearby villages.
The approach to security is a blend of low and high tech. It relies on residents of surrounding areas to alert it to poachers. Local intelligence is then combined with satellite tracking of the elephants. This helps anti-poaching rangers to know where to go.

Winning the support of people on the edge of the park has been crucial. Locals are happy to help report sightings of the Janjaweed, since they fear being robbed or murdered by them. African Parks also negotiates with nomads to ensure their caravans of camels do not go through the park.

Excerpts from Elephants’ graveyard no more: African governments are outsourcing their natural areas, Economist, Oct. 22, 2020

Modern Slavery and the Collapse of Fisheries

Illegal, unreported and unregulated fishing accounts for a staggering 20-50% of the global catch. It is one reason fish stocks are plummeting: just a fifth of commercial species are sustainably fished. Illegal operators rob mostly poor coastal states of over $20bn a year and threaten the livelihoods of millions of small fishermen. A huge amount of illicit fishing happens on licensed boats, too. They might catch more than their quota, or falsely declare their catch as abundant albacore tuna instead of the more valuable bigeye. In port fisheries inspectors are always overstretched. If an operator is caught, for instance, fishing with too fine a net, the fine and confiscation are seen as a cost of doing business. Many pay up and head straight back out to sea.

The damage from illicit fishing goes well beyond fish stocks. Operators committing one kind of crime are likely to be committing others, too—cutting the fins off sharks, or even running guns or drugs. Many are also abusing their crews… A lot of them are in debt bondage…. Unscrupulous captains buy and sell these men and boys like chattel

Too often, the ultimate beneficiaries of this trade are hard to hook because they hide behind brass-plate companies and murky joint ventures. Pursuing them requires the same kind of sleuthing involved in busting criminal syndicates. An initiative led by Norway to go after transnational-fisheries crime is gaining support. Much more cross-border co-operation is needed.

At sea, technology can help. Electronic monitoring promises a technological revolution on board—Australian and American fleets are leading the way. Cameras combined with machine learning can spot suspicious behavior and even identify illicit species being brought on board…. Equally, national regulators should set basic labor standards at sea. If countries fail to follow the rules, coastal states should bar their fishing fleets from their waters. Fish-eating nations should allow imports only from responsible fleets.

Above all, governments should agree at the World Trade Organization to scrap the subsidies that promote overfishing. Of the $35bn a year lavished on the industry, about $22bn helps destroy fish stocks, mainly by making fuel too cheap. Do away with subsidies and forced labor, and half of high-seas fishing would no longer be profitable. Nor would that of China’s environmentally devastating bottom-trawling off the west African coast. 

Excerpt from Monsters of the deep: Illicit fishing devastates the seas and abuses crews, Economist, Oct., 22, 2020

What really happens in the seas? GlobalFishing Watch, Sea Shepherd, Trygg Mat Tracking

Just Forbid It – Fishing: Fishing and Marine Protected Areas

Fish, whether wild caught or farmed, now make up nearly a fifth of the animal protein that human beings eat….In this context, running the world’s fisheries efficiently might seem a sensible idea. In practice, that rarely happens. Even well-governed coastal countries often pander to their fishing lobbies by setting quotas which give little respite to battered piscine populations. Those with weak or corrupt governments may not even bother with this. Deals abound that permit outsiders legal but often badly monitored access to such countries’ waters. And many rogue vessels simply enter other people’s fishing grounds and steal their contents.

There may be a way to improve the supply side: increase the area where fishing is forbidden altogether.  This paradoxical approach, which involves the creation of so-called marine protected areas (MPAs), has already been demonstrated on several occasions to work locally. A new study “A global network of marine protected areas for food “in the Proceedings of the National Academy of Sciences…explores the idea of extending MPAs elsewhere. If the right extensions are picked designating a mere 5% more of the world’s oceans as MPAs—which would triple the area protected—could increase the future global catch of the 811 species they looked at by more than 20%. That corresponds to an extra 10m tonnes of food a year.

The idea that restricting fishing would permit more fish to be caught may seem counterintuitive, but the logic is simple. Fish in MPAs can grow larger than those at constant risk of being pulled from the ocean. Larger fish produce more eggs. More eggs mean more fry. Many of these youngsters then grow up and move out of the safe zone, thus becoming available to catch in adjoining areas where fishing is permitted…

MPAs are especially beneficial for the worst-managed areas, most of which are tropical—and in particular for overfished species…They also have the virtue of simplicity. The setting of quotas is open to pressure to overestimate of how many fish can safely be caught…This is difficult enough for countries with well-developed fisheries-research establishments. For those without such it is little more than guesswork…Setting the rules for an MPA is, by contrast, easy. You stick up a metaphorical sign that says, “No fishing”. Knowing who is breaking the rules is easy, too. If your gear is in the water, you are fishing illegally.

Excerpt from Fishing: Stopping some fishing would increase overall catches. Economist, Oct. 31, 2020

The Industrial Chicken and the US-China Rivalry

Animal diseases, the US-China trade war and covid-19 have all disrupted, or threatened to disrupt, industrial chicken supplies and supply chains…The unsentimental logic of high-performance poultry-rearing is easy to grasp. “White-feather meat chickens”, as they are known in China, grow to 2.5kg in 40 days. Homegrown varieties of “yellow-feather chicken”, descended from backyard fowl, take twice as long to mature and will only ever weigh half as much…

Half a century ago meat in China was a rare luxury. Now, many see it as a daily necessity. In the meantime, the country’s supplies of farmland and clean water have not grown. Agriculture remains blighted by food-safety scandals, the rampant use of fake or illegal animal medicines, and disease outbreaks. Small surprise, then, that Chinese leaders give frequent speeches about food security. A puzzle lurks, though. Leaders also call for self-reliance in key technologies. And in the case of broiler chickens, those two ambitions—rearing meat efficiently and avoiding dependence on imports—are in tension.

The chicken imported into China are the fifth-generation descendants of pedigree birds whose bloodlines represent 80 years of selection for such traits as efficient food-to-meat conversion, rapid growth, strong leg bones and disease resistance. After waves of consolidation, the industry is dominated by two firms, Aviagen (based in Alabama and owned by the ew Group of Germany) and Cobb (owned by Tyson, an American poultry giant).

The most valuable pedigree birds never leave maximum-security farms in America and Britain: a single pedigree hen may generate 4m direct descendants. Their second-generation offspring are flown to breeding sites dispersed between such places as Brazil, Britain and New Zealand, in part to hedge against supply shocks when avian influenzas and other diseases close borders. Day-old third-generation chicks are air-freighted to Jinghai Poultry, a company in China, and other places, which spend six months growing them and breeding them in climate-controlled, artificially lit indoor facilities. In all, China imports 1.6m third-generation white-feather chicks a year.

Jinghai  Poultry hatches 8m fourth-generation, “parent stock” chickens annually. The company sells some to other agri-businesses. It breeds from the rest to produce fifth-generation chicks. These are “meat chickens”, consumed in fast-food outlets, schools and factory canteens, or as chicken parts sold in supermarkets. Yellow-feather chickens, deemed tastier by Chinese cooks, account for most whole birds sold in markets.

Chinese breeders have long tried to create local varieties with bloodlines available in-country… In September 2019, the State Council, China’s cabinet, issued a paper on livestock-rearing that set self-sufficiency in poultry as a goal, calling meat-chicken breeding a priority. Big foreign firms have resisted appeals from officials to send second-generation stock to China….Dependence on foreign bloodlines does carry risks. For several months recently New Zealand was one of the only countries able to send third-generation chicks to China, after other exporters suffered bird-flu outbreaks.

Li Jinghui, president of the China Broiler Alliance, an industry association, calls conditions ripe for China’s “brilliant” scientists to develop local birds… But to develop a domestic breed from scratch would take years, and if it does not meet market needs, a firm could spend a fortune “without much to show for it”…Without a stronger animal-health system and environmental controls, biotechnology alone cannot help China to develop world-class agriculture. Moreover, a long-standing Chinese strategy—bullying foreign firms to hand over intellectual property—is counter-productive now.

Excerpts from High-tech chickens are a case study of why self-reliance is so hard, Economist, Oct. 31, 2020

Lots of Money Forever for Waste that Lasts for Forever: Nuclear Waste in Japan

Since August 2020, two local governments on the western shore of Hokkaido in Japan have said they will apply to the central government for a survey that could eventually lead to their municipalities hosting a permanent underground repository for high-level radioactive waste. The fact that these two localities made their announcements about a month apart and are situated not far from each other was enough to attract more than the usual media attention, which revealed not only the straitened financial situations of the two areas, but also the muddled official policy regarding waste produced by the country’s nuclear power plants.

The respective populations of the two municipalities reacted differently. The town of Suttsu made its announcement in August 2020, or, at least, its 71-year-old mayor did, apparently without first gaining the understanding of his constituents, who, according to various media, are opposed to the plan…. Meanwhile, the mayor of the village of Kamoenai says he also wants to apply for the study after the local chamber of commerce urged the village assembly to do so in early September 2020. TBS asked residents about the matter and they seemed genuinely in favor of the study because of the village’s fiscal situation. Traditionally, the area gets by on fishing — namely, herring and salmon — which has been in decline for years. A local government whose application for the survey is approved will receive up to ¥2 billion in subsidies from the central government… Kamoenai, already receiving subsidies for nuclear-related matters. The village is 10 kilometers from the Tomari nuclear power plant, where some residents of Kamoenai work. In exchange for allowing the construction of the plant, the village now receives about ¥80 million a year, a sum that accounts for 15 percent of its budget. According to TBS, Kamoenai increasingly relies on that money as time goes by, since its population has declined by more than half over the past 40 years.

Since Japan’s Nuclear Waste Management Organization started soliciting local governments for possible waste storage sites in 2002, a few localities have expressed interest, but only one — the town of Toyo in Kochi Prefecture — has actually applied, and then the residents elected a new mayor who canceled the application. The residents’ concern was understandable: The waste in question can remain radioactive for up to 100,000 years.

The selection process also takes a long time. The first phase survey, which uses existing data to study geological attributes of the given area, requires about two years. If all parties agree to continue, the second phase survey, in which geological samples are taken, takes up to four years. The final survey phase, in which a makeshift underground facility is built, takes around 14 years. And that’s all before construction of the actual repository begins.

Neither Suttsu nor Kamoenai may make it past the first stage. Yugo Ono, an honorary geology professor at Hokkaido University, told the magazine Aera that Suttsu is located relatively close to a convergence of faults that caused a major earthquake in 2018. And Kamoenai is already considered inappropriate for a repository on a map drawn up by the trade ministry in 2017.

If the Nuclear Waste Management Organization’s process for selecting a site sounds arbitrary, it could reflect the government’s general attitude toward future plans for nuclear power, which is still considered national policy, despite the fact that only three reactors nationwide are online.

Japan’s spent fuel is being stored in cooling pools at 17 nuclear plants comprising a storage capacity of 21,400 tons. As of March 2020, 75 percent of that capacity was being used, so there is still some time to find a final resting place for the waste. Some of this spent fuel was supposed to be recycled at the Rokkasho Reprocessing Plant in Aomori Prefecture, but, due to numerous setbacks, it doesn’t look as if it’s ever going to open, so the fuel will just become hazardous garbage.

According to some, the individual private nuclear plants should be required to manage their own waste themselves. If they don’t have the capacity, then they should create more. It’s wrong to bury the waste 300 meters underground because many things can happen over the course of future millennia. The waste should be in a safe place on the surface, where it can be readily monitored.  However, that would require lots of money virtually forever, something the government would prefer not to think about, much less explain. Instead, they’ve made plans that allow them to kick the can down the road for as long as possible.

Excerpt from PHILIP BRASOR, Hokkaido municipalities gamble on a nuclear future, but at what cost? Japan Times, Oct. 24, 2020

How to Exploit the Secrets of the Ocean: DARPA

PARC, A Xerox Company, announced on October 22, 2020,  it has been awarded a contract by the Defense Advanced Research Projects Agency (DARPA) for the next development phase in the Ocean of Things. Initially announced by DARPA in 2017, the Ocean of Things project is deploying small, low-cost floats in the Southern California Bight and Gulf of Mexico to collect data on the environment and human impact. This includes sea surface temperature, sea state, surface activities, and even information on marine life moving through the area.

Xerox Ocean Float is Equipped with Camera, GPS and other sensors. Ocean of Things

“Oceans cover more than 70 percent of the earth’s surface, but we know very little about them,” said Ersin Uzun, vice president and general manager of the Internet of Things team at Xerox. “The floats gather data that we could never track before, enabling persistent maritime situational awareness.” Each solar-powered drifter has approximately 20 onboard sensors, including a camera, GPS, microphone, hydrophone, and accelerometer. The different  sensors can provide data for a broad array of areas including ocean pollution, aquafarming and transportation routes…Among other things, the float needed to be made of environmentally safe materials, be able to survive in harsh maritime conditions for a year or more before safely sinking itself, and use advanced analytic techniques to process and share the data gathered…PARC built 1,500 drifters for the first phase of the project and will deliver up to 10,000 that are more compact and cost-effective for the next phase. 

Excerpt from DARPA Awards PARC Contract to Expand Ocean Knowledge, XEROX Press Release, Oct. 22, 2020

The Unbankables: Fossil-Fuel Companies

Defenders of the oil-and-gas industry in Washington are fighting back against big banks who want to stop financing new Arctic-drilling projects, fearing it could be a harbinger of an unbankable future for fossil-fuel companies. Five of the six largest U.S. banks— Citigroup, Goldman Sachs,  JPMorgan Chase, Morgan Stanley, and Wells Fargo have pledged over the past year to end funding for new drilling and exploration projects in the Arctic.  Alaska Sen. Dan Sullivan has been lobbying the Trump administration to examine whether the federal government can prevent banks from cutting off financing.

“That these banks would discriminate against one of the most important sectors of the U.S. economy is absurd,” Mr. Sullivan said in an interview. “I thought it was important to push back.” The American Petroleum Institute, one of industry’s most influential lobbying groups, has said it is working with the Trump administration on the issue, which it called a “bad precedent.” API, Mr. Sullivan and others have also suggested the White House should examine whether it could cut off the banks’ access to funding under coronavirus relief packages.

Wall Street has been pulling back from the oil-and-gas industry after years of dismal returns from it and is under increasing pressure from environmentalists and others to limit fossil-fuel lending. While broader market conditions during the coronavirus pandemic this year have dried up capital for new exploration, some analysts have said a lack of bank financing could deter drilling in the Arctic National Wildlife Refuge, which the administration opened to exploration in August 2020…

Capital flight remains one of the primary risks facing the oil industry, according to Moody’s Corp. If the world were to accelerate a transition to renewable sources of energy, oil-and-gas reserves could become uneconomic and turn into a credit liability for producers, making it difficult to access longer-maturity loans, Moody’s said.

Alaska’s economy is almost entirely dependent on the fossil-fuel industry, which has historically funded about 90% of the state’s general fund through tax revenues. Energy executives worry the pledges that banks are making could spread to other regions and parts of the industry as pressure mounts from environmental groups, and companies face the prospect of tighter government regulations. This week, JPMorgan pledged to push clients to align with the Paris climate accord and work toward global net zero-emissions by 2050.

“If it is successful, why would they stop with the Arctic?” said wildcatter Bill Armstrong, founder of Armstrong Oil & Gas Inc., which has discovered more than 3 billion barrels of oil in Alaska. “A lot of misguided people are trying to make oil and gas the new tobacco.

Excerpt from Christopher M. Matthews and Orla McCaffrey, Banks’ Arctic Financing Retreat Rattles Oil Industry, WSJ, Oct. 9 2020

The $1Million Narco-Submarines

South America is awash with cocaine, and traffickers are turning to new ways of getting it to Europe…. Submarines that carry illicit drugs dubbed ‘narco-subs’ are described as low-tech, uncomfortable and hazardous, earning them the nickname ‘water coffins.’

Narco-subs have ferried cocaine from Colombia to Central America since the 1990s and recently proliferated. Rarely true submarines, they are generally semisubmersibles that float mostly but not completely below the waterline and are nearly undetectable. Most are built out of sight in South American jungles for around $1 million a piece. The discovery of a narco-sub, in November 2019,  off Spain’s northwestern coast, according to law-enforcement officials, was the first confirmation of rumors that such a vessel could reach Europe.

Excerpt from James Marson, Narco-Submarine’ Caught After Crossing the Antic,  WSJ, Oct. 18, 2020

Turtle Eggs Can Fool Poachers

The InvestEGGator is used to reveal illegal trade networks and better understand what drives sea turtle egg poaching. The scientists deployed around a hundred of the fake eggs in sea turtle nests across four beaches in Costa Rica and waited. Each egg contained a GPS transmitter set to ping cell towers every hour, which would allow scientists to follow the InvestEGGator eggs on a smartphone app…Five of the deployed eggs were taken by unsuspecting poachers. The shortest route was roughly a mile, but one InvestEGGator traveled more than 80 miles, capturing what researchers were hoping for: the complete trade route, from the beach to the buyer. “Having that moment where the trade chain was complete….that was obviously a very big moment,” says Pheasey.

The InvestEGGator was the invention of Kim Williams-Guillén… The trick, says Williams-Guillén, was designing a device that looked and felt like a sea turtle egg while being precise enough to reveal trade routes. Sea turtle eggs are the size of ping pong balls, but unlike brittle chicken eggs, their shell is leathery and pliable. “Making [the trackers] look like eggs from far away was not going to be an issue, it was more making them feel like turtle eggs,” says Williams-Guillén. “One of the ways that [poachers] know that a turtle egg is good when they’re sorting their eggs is that it’s still soft and squishy.”…

Of the nests containing decoy eggs, a quarter were illegally harvested. Some of the eggs failed to connect to a GPS signal, while other eggs were spotted by poachers and tossed aside. Five of those poached eggs gave the team useful tracking data…This illegal trade network revealed that eggs are sold and consumed locally… The routes they discovered also suggest that most egg poachers in the area are individuals looking to make quick money, not an organized network.

Excerpt from Corryn Wetzel, 3-D Printed Sea Turtle Eggs Reveal Poaching Routes, SMITHSONIANMAG.COM, Oct. 7, 2020

Government Intervention is Great: What China is Learning from the United States

A study published by the China Aerospace Studies Institute in September 2020′China’s Space Narrative: Examining the Portrayal of the US-China Space Relationship in Chinese Sources‘ used publicly available Chinese language resources to draw insights on how the Chinese view the U.S.-China space relationship. According to the study:

“Chinese sources weave a space narrative that portrays China as a modernizing nation
committed to the peaceful uses of space and serving the broader interests of advancing humankind through international space cooperation, economic development, and scientific discovery. Chinese sources minimize the military role of China’s space program.

In contrast, the same sources portray the United States as the leading
space power bent on dominating space, restricting access to space, and limiting international space cooperation to countries with similar political systems and level of economic development.

The report concludes that the United States and China are in a long-term competition in space in which China is attempting to become a global power, in part, through the use of space. China’s primary motivation for developing space technologies is national security…China’s space program is one element of its efforts to transition the current U.S.-dominated international system to a multipolar world….

Many Chinese writings on commercial space analyze the experiences of U.S. companies, with a particular focus on SpaceX. Chinese space experts call SpaceX the “major representative company” for commercial space worldwide. A report from Hong Kong media claims that Chinese investors view SpaceX as the “benchmark company” for emerging commercial space companies in the mainland. Chinese authors also follow developments in other U.S. commercial space companies, such as Digital Globe
and Rocket Lab.

Chinese authors also pay attention to the ways in which the U.S. government uses various policies and incentives to create a favorable ecosystem for the growth of new commercial space companies. Chinese writings analyze ways in which NASA has supported private companies with funding, technology transfer, consulting, and infrastructure leasing. Although their specific recommendations vary, Chinese authors view strong government oversight and intervention as crucial toward the success of the domestic commercial space industry.”