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There won't be a newsletter next week. We're off for the holiday.
Cancel your Thanksgiving plans, they say. Well, joke's on the CDC because I never had any.
Seriously, though, what a gloomy holiday season.
Almost half as many people will travel for Thanksgiving this year, according to GasBuddy — even though prices at the pump will be at a 4-year low.
That's bad news for oil and the companies that sell it. But markets are still reaping rewards from positive vaccine news. The S&P 500 energy index was up more than 16% as of Friday morning, compared to last month.
"Vaccine news have in a way replaced demand woes and forecasts in the oil market," Rystad Energy's Bjornar Tonhaugen wrote in a note this morning.
Anyway, I do love Thanksgiving and I will find a way to consume some tofurky next week. In the meantime, let's get to this week's top stories.
Biden's secret weapon to combat carbon emissions — with or without Senate control
I love topics that are neither sexy nor easy to explain. So, naturally, I've clung to news about fuel efficiency standards.
What are they? Essentially, these standards set a minimum mpg (miles per gallon) for the average new car in an automaker's fleet. If you sell more hybrids and electric vehicles, you'll have a higher average mpg.
Fun fact! These standards were originally designed to lower the nation's dependence on oil in the wake of the OPEC embargo, and the ensuing crisis, of the 1970s.
Today the standards are considered among the US government's most important climate-change policies. The transportation sector is the largest direct source of greenhouse gas emissions in the US.
Why do they matter now? The standards are likely about to change — again — which could impact US auto giants and oil markets.
Under former President Barack Obama, carmakers had to meet an average efficiency of 54.5 mpg by 2025.
Trump rolled the standard back, finalizing a rule this spring that requires fleets to reach only 40 mpg, which "his administration called the single largest deregulatory initiative of his tenure," the New York Times reports.
President-elect Joe Biden is likely to return to Obama-era standards at a minimum, a change that would not require legislation.
That could cut into oil demand by 500,000 barrels per day, according to Rystad Energy.
How will it impact automakers? There will be an even greater incentive to sell electric cars, and auto giants that sell a lot of cars in the US could be forced to ramp up electrification.
Ford is among the companies to watch.
The company's largest market is in North America and it trailed other major automakers in EV sales, as of 2018. It was also among the companies that called on the Trump administration to water down the standards back in 2017.
Since then, Ford has changed its tune: Ford broke with the Trump administration in favor of stricter standards and said it's making big investments into EV production. A change in fuel efficiency standards could push the company even further.
Are you a current or former employee at Ford? Reach out at firstname.lastname@example.org or at 646-768-1657.
But: Most automakers aren't as focused on the US market. They also likely won't have a problem meeting Obama-era fuel standards, John Gartner, an automotive expert at the Center for Sustainable Energy, told me this morning, because "the momentum is towards greater electrification" already.
The battle over drilling in the Arctic Refuge continues. Still. Do oil companies care?
If you feel like you've been reading about the fight over oil in Alaska's Arctic National Wildlife Refuge for decades, it's because you have. It's literally been going on since 1980! That's when part of the refuge was designated for oil development.
What's new: In August, the Trump administration finalized plans to greenlight a large chunk of the refuge for oil and gas drilling. This week it moved to sell leases before Trump's term is up.
The stakes: ANWR is the largest remaining swath of wilderness in the nation. It's also home to what is believed to be a ton of oil.
Is the issue moot? Perhaps. For one, president-elect Joe Biden may be able to reject the leases. Moves to drill will also likely face legal hurdles, the New York Times reports.
Plus, big oil companies may not want to drill there anyway, as we previously reported.
While the prospect of drilling in ANWR might have been appealing several years ago, the calculus looks a lot different today.
With oil prices still down, companies are looking to cut costs, and drilling in ANWR would be expensive and risky.
It's also not a good look as pressure rises among investors to produce more sustainable energy.
3 big clean-tech deals that caught our attention this week
Form Energy: The buzzy startup — which develops big batteries that can store power on the grid — scored $70 million, Reuters first reported. The firm now has $120 million in funding, per Reuters.
We profiled the company and its ex-Tesla founder, Mateo Jaramillo, earlier this year. Check out that story here.
We also detail some of the company's secretive tech after reviewing a patent (with the help of battery experts) here.
There's more! Jaramillo was one of our Energy Transformers this year. Check out his profile here (no paywall).
Heila Technologies: Micro-grid startup Heila closed a $3 million seed round.
Heila is a neat, albeit obscure, company. It aggregates local energy resources, like rooftop solar panels or batteries, into a distinct unit that can operate independently from the grid.
The firm's CEO and cofounder, Francisco Morocz, was one of Business Insider's rising stars of clean energy this year. You can read his whole profile here (and see the 20 others that made the list).
WattBuy: Digital utility startup WattBuy raised about $3 million from investors including Evergy Ventures and Techstars Ventures.
WattBuy is among the raft of digital startups that are trying to disrupt the utility sector. Arcadia is another.
In other investing news: Major investor Union Square Ventures is raising a climate-tech fund, in the range of $100 million to $200 million, the Wall Street Journal first reported.
"The move is an indication that climate tech is gaining new support in the venture industry after largely falling out of favor about a decade ago," The Journal's Yuliya Chernova wrote.
That's it! My dog and I wish you all a safe and happy Thanksgiving.
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