Weekly clippings #30 - Chinese coal boom, banning ESG, ESG conflicts of interest, conflicts with reality

This week in Science features a 2023 review of extreme weather in the United States and (shock) 80% of them are average or below average and the two that are above average show no trend since 2020.

In Investment/Economics I bring you an article about the Chinese coal boom, four about ESG troubles, one about Canada’s climate policy fantasy, and one about a conflict of interest  in ESG ratings. 

In the theatre of the absurd, some people are worried about the faster rate of grass growth with rising CO2 fertilization leading to fatter horses. 

25 holiday Power Facts about energy and climate "As you sit down at the dinner table this holiday season, I expect many of you will find yourselves in conversations about energy and climate with friends and family who may have come to inaccurate conclusions, in part because they are missing a lot of the relevant facts. So, I’ve compiled 25 true, succinct, powerful facts about energy and climate. Each “Power Fact” has significant implications and should make any honest person think twice about the anti-fossil-fuel narrative. Together these facts show that the world needs more, not less, fossil fuels for as many people as possible to be productive, prosperous, and safe from climate—a job that cannot be done by unreliable solar and wind."

U.S. Climate Extremes: 2023 Year in Review  As the summary table below shows, when we look at ten measures of weather, 80% of them are average or below average and the two that were above average show no trend since 2000. Despite this, 2023 headlines were again filled with news of supposed extremes. Reporters should really do proper due diligence.

Beijing’s Coal Boom Is Here to Stay China's economy is mostly based on fossil fuels, which are the most affordable, abundant and dependable energy source. In short, China's security and economic growth depend on satiating the country's colossal appetite for fossil fuels. Western politics around a non-existent climate crisis won't change that.

A $1.5 Trillion Loan Market Feels the Fallout of Anti-ESG Forces Next year, an estimated $187 billion of SLLs are coming due globally, with about 90% of those in the form of revolving credit facilities, according to data compiled by Bloomberg. There are already signs that bankers may treat those loans with caution, as regulators start to pay more attention to a market that’s so far avoided their scrutiny.

The Rise, Demise and Evolution of ESG Investing The build-up for all things environmental, social and governance was so orchestrated and the expectations so elevated, regulators had to step up and police companies from overstating their coveted ESG status. Because, for a time, the ESG label looked like a license to print money. As Eric Balchunas of Bloomberg Intelligence has often said, if you take the politics out of ESG investing, it’s just active management.

Wall Street’s ESG Craze Is Fading The about-face comes after tightened regulatory oversight, higher interest rates that have slammed clean-energy stocks and a backlash that has made environmental, social and corporate-governance investing a political target. “This really is the result of too many managers looking to cash in on increased awareness and demand for ESG investments.”

Trailblazer of sustainable investing says ESG should be banned Nanuk Asset Management’s Tom King, a trailblazer of sustainable investing in Australia, says ESG labels should be banned, criticising the acronym as confusing and the associated scores as “meaningless”.

The Trudeau climate plan runs into reality For all the pain and divisiveness they have brought, Canada’s climate policies, even if they achieved their net-zero fantasy, would have only a minuscule impact on global temperatures. The much maligned oil sands, which represent 97 per cent of Canada’s proven oil reserves, only constitute one one-thousandth of global emissions. Their share of manmade GHG emissions is one part in 25,000. When the prime minister claims that Canadian emissions are contributing to extreme weather events, like forest fires here, he is simply making it up. On that point, even the UN’s International Panel on Climate Change agrees.

MSCI accused of ‘conflicts of interest’ in ESG ratings Firms deriving most of their revenues from their indexing business provide higher ESG ratings to stocks boasting stronger returns, allowing these companies to be overweighted in their ESG benchmarks. 

Climate change is making horses fat as it's causing an abundance of grass to grow, top vet warns Mr Moffat said: "Warmer and wetter climates also mean greater grass availability. "This makes it more difficult for owners to recognise the importance of feed quantities and qualities for their horses in the 'battle' to manage weight."