Equilibrium/Sustainability — Tesla unveils $1,900 ATV for kids


Today is Thursday. Welcome to Equilibrium, a newsletter that tracks the growing global battle over the future of sustainability. Subscribe here: thehill.com/newsletter-signup.

Tesla is rolling out a marked-up model for miniature motorists just in time for the holidays, but the company can't guarantee that the $1,900 "Cyberquad" will actually arrive to kids by Christmas morning, Business Insider reported.

The shiny electric ATV for children ages 8 and up costs a stiff $1,900 and travels up to 10 miles per hour, according to Business Insider. But the ATV - whose price TechCrunch describes as steep "relative to your average Power Wheels" - was sold out as of Thursday evening.

For those who were able to order one, shipping will begin in two to four weeks, with orders "not guaranteed to arrive prior to the holidays," Tesla's website warns. For the grownups who drive full-size Teslas - or the variety of other electric vehicles now cruising the nation's roads - researchers are looking into how adding artificial sounds to these typically quiet cars can improve pedestrian safety, the Acoustical Society of America reported.

Today we'll turn across the world to Madagascar, where an international group of scientists has determined that a catastrophic hunger crisis may in fact not be caused by climate change. Then we'll talk to the CEO of ClimateAI, a company focused on reducing the risks caused to supply chains by climate change, about why those dangers have remained a blind spot for companies.

For Equilibrium, we are Saul Elbein and Sharon Udasin. Please send tips or comments to Saul at selbein@thehill.com or Sharon at sudasin@thehill.com. Follow us on Twitter: @saul_elbein and @sharonudasin.

Let's get to it.

'Natural variability' in rain leading to famine

The crippling drought conditions that have spurred a devastating hunger crisis in Madagascar may not be driven by human-caused climate change, a new analysis has found.

Southern Madagascar - the island nation's "Grand Sud" region in which 90 percent of the population lives below the poverty line - has been confronting a deteriorating food security system, made worse by a two-year lack of precipitation, the authors confirmed.

Rebuffing recent reporting, however, the analysis determined that the poor rains largely stemmed from "natural variability."

A hot-button issue: Madagascar's hunger crisis has recently come into the limelight as a cautionary tale of the ramifications of human-induced climate change. Just last month, the executive director of the United Nations World Food Program described the situation as a "wake up call" for what the world "can expect" to see, as The Hill reported.

The World Food Program estimates that 1.3 million people in Madagascar are food insecure and in need of humanitarian assistance, while 28,000 people in the Grand Sud are facing "catastrophe-level" food insecurity.

What did the new analysis look at? Scientists at World Weather Attribution - an international initiative led by the Imperial College London and the Royal Netherlands Meteorological Institute - analyzed a series of peer-reviewed models and observations that examined the region's shortage of precipitation from July 2019 to June 2021.

The rainy seasons of 2019-2020 and 2020-2021 saw just 60 percent of their normal rainfall - estimated to be "a 1-in-135 year dry event," surpassed only by a drought in 1990-1992, the analysis found.

Coping with any drought is a struggle: Because Madagascar is one of the world's poorest nations, communities struggle to cope with any period of prolonged drought, particularly when their farming methods rely on rain-fed irrigation only, the authors wrote.

An April 2021 assessment found that more than 43 percent of the population - about 1.14 million people - are confronting food insecurity, the report said, citing the Integrated Food Security Phase Classification group.

Climate change has raised temperatures, but not consistent drought trends: While the authors acknowledged that the frequency and intensity of high temperatures have increased "due to anthropogenic climate change," they said that a comprehensive survey of regional droughts showed that "there were no consistent trends of observed changes in drought."

"We conclude that even though models show, on average, a small increase of major 2-year droughts like the 2019-2021 one, the trend is not statistically significant compared to natural variability," the authors wrote.

'THE COMPLEXITY OF REGIONAL FOOD SECURITY'

Another "risk multiplier" wasn't weather-based at all: The analysis also found the coronavirus pandemic to be "an important risk multiplier in the food insecurity crisis," as restrictions limited people's abilities "to migrate for casual labor." The pandemic also exacerbated price hikes for food staples, while disrupting the tourism, mining and textile industries.

"This combination of factors underscores the complexity of regional food security in general as well as the difficulty to 'bounce back' following failed seasons even if a rainy season is climatologically normal," the report said. And these past two seasons were far from normal.

The dangers of blaming climate change: Friederike Otto, co-head of World Weather Attribution, warned against attributing all crises to climate change, in an interview with Reuters.

"When you just blame everything on climate change then you take all the agency away from local decision makers to actually deal with the disasters," Otto said.

But Madagascar is still vulnerable to a warming climate, as CNN reported. If temperatures continue to rise, the country "is likely to suffer from stronger tropical cyclones and, in places, possibly more droughts," Lisa Thalheimer, a postdoctoral researcher at Princeton University who took part in the study, told CNN.

Last words: "Unless carbon emissions are reduced globally, any increase in extreme weather events will compound existing vulnerabilities and particularly harm the poorest people," Thalheimer said.

Curbing climate-related supply chain issues

Cargo ship at sea
Cargo ship at sea

As businesses focus on how to green their supply chains, they risk leaving out something important: adapting to the coming danger of climate change, Himanshu Gupta, CEO of ClimateAI, told Equilibrium.

ClimateAI is a modeling and analytics company that aims to help companies evaluate the risk climate poses to their supply chains.

Gupta sat down with Equilibrium to discuss the challenges - and necessity - of guarding against those risks in a world of increasingly disrupted global industrial chains.

First words: There is "a false sense of a cushion:" that severe physical risks only happen at 2, 3 or 4 degrees Celsius (4-7.2 degrees Fahrenheit), and that such dangers are decades off, according to Gupta.

"Even with 1.2 degrees, impacts we're seeing globally in terms of impacts on supply chains, top lines and bottom lines, is unprecedented," he said.

Business lags behind: The rise in pressure from regulators and investors to cut emissions - and exposure to "transition risk" from the phasing out of fossil fuels - hasn't been met by a corresponding push for adaptation or heightened resilience, Gupta added.

The drama bias: One failing of sustainability discourse has been an over-focus on the risk of dramatic events like California wildfires or German floods.

"But chronic physical risk is equally if not more damaging," he said. "Droughts, impacts on surface water availability, or how heat pressure impacts what can be grown globally."

Who are those disruptions hitting? Agricultural supply, textile and food service companies - and the farmers they rest atop - are on the front lines.

Pacific Seeds, an Australian company that contracts with ClimateAI, has seen "massive disruption and variability in sales numbers" because climate change has made the arrival of the planting season so uncertain.

"They had been using historical averages to determine how much sales inventory to keep before the end of season," Gupta said. "They worked on the notion that the past is a predictor of the future, which is not true."

What about other industries? Steel plants, for example, are spending more time on addressing the transition risk from the pivot off fossil fuels - like how to move off metallurgical coal (the kind used in metal-smelting) by replacing it with, for example, green hydrogen - than they are on the physical risks to their supply chains and industrial operations.

Even in financial filings, Gupta said, "companies may claim that they face 'medium-high physical risk', but what does that mean? 'Medium' might mean different things in the U.S. versus India, or in the pharmaceutical supply chain versus in agriculture."

WHAT TO DO ABOUT IT?

Account for it, Gupta said. As the Securities and Exchange Commission looks into including transition risk disclosures in the legally-binding Form 10K, which all publicly-traded companies have to file, Gupta said they should follow the lead of countries like New Zealand and the U.K. and clear up that ambiguity by including rigorous, industry-specific standards for physical risk too.

"And if Democrats get another term, that will probably happen here too," Gupta said.

What's the roadblock? For most businesses, it's a lack of clarity on the staggeringly complex supply chains themselves; on conditions on the ground and on the future of the changing climate.

"Automobile supply chains have more than 250 parts coming from 2,000-plus locations and 20,000 suppliers globally," Gupta said.

"So it becomes very difficult to understand what any supply chain is, and to understand the data: how much water is every supplier using, how much energy? Is their energy vulnerable to hurricane or cyclone risk?" he said.

A business opportunity: This is where ClimateAI has found a lucrative opportunity.

"Companies come to our platform, and input a list of their supplier locations - and then the program starts giving alerts if some supplier is exposed to extreme weather risk, whether in the next week or the next 10 to 20 years," Gupta said.

Last words: We can adapt to the coming - and ongoing - disruptions, Gupta added. "But we have to start the adaptation now."

Thorny Thursdays

Tough decisions around the world.

California water districts won't receive supply boosts from state

  • California water agencies - which serve 27 million residents and 750,000 acres of agriculture across the states - won't receive the water they've requested from the state, beyond what is necessary for critical health and safety, the Los Angeles Times reported.

  • This is the earliest date that the Department of Water Resources has ever issued a 0-percent water allocation, as reservoirs sit at historically low levels and state officials warn of mandatory water restrictions to come, according to the Times.

A gold rush for electric vehicle battery components

  • Global mining companies are in a race to lock down sustainability-friendly stores of minerals like lithium, which is expected to rise 20 times in demand by 2030, The Wall Street Journal reported.

  • Companies face an environmental, social and governance (ESG) paradox: the materials needed for a zero-carbon economy currently come from many countries with bad environmental and labor conditions, and fixing that will require a big up-front investment.

McDonalds and other meat producers aren't tracking methane

That's it for today. Please visit The Hill's sustainability section online for the web version of this newsletter and more stories. We'll see you Friday.