🌍 Special Earth Day Edition (feat. crypto carbon)

Thursday, April 22, 2021 by Robinhood Snacks | Disclosures
_Post-Bitcoin mining sesh energy [RyanJLane/E+ via GettyImages]_

Post-Bitcoin mining sesh energy RyanJLane/E+ via GettyImages

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Hey Snackers,

Happy Earth Day! NASA just flew a helicopter on Mars, but today we're focusing on our own planet — and how different companies and industries are affecting the environment.

Today, President Biden is kicking off a major climate summit with 40 world leaders, after the US rejoined the Paris Agreement in February.

Food

1. The Food Footprint: agriculture and the rise of plant-based food

The avo burger can walk... and it leaves a carbon footprint. Wild stat: the global food production system accounts for more than a third of human-made greenhouse gases. Wilder stat: ~45% of Earth's ice-free land is covered by crops to feed livestock — that means fewer trees and plants to suck up CO2.

  • 10%: The portion of US greenhouse gas emissions generated by agriculture. Cows used for beef and milk are the largest emitters (they breathe out methane when they digest).
  • 28X: Cows require 28X more land and 11X more water than other farm animals... and emit 5X more greenhouse gas.

pea.protein22 has joined the chat.... Sustainability concerns have propelled the rise of plant-based foods. In March 2020, 9.7M Americans reported following plant-based diets, up from 300K in 2004. Beyond Meat and Impossible Foods say their plant burgers generate ~90% fewer emissions than beef (and require less water and land). Now, alt-food companies are gaining mainstream appeal:

  • Beyond is expanding in chains like Walmart and Subway — and recently partnered with McDonald's and KFC-owner Yum Brands.
  • Impossible launched at TJ's and Walmart, and has breakfast sammies at Starbucks and Burger King (plus, the Impossible Whopper).
  • Oatly snagged a key partnership with Starbucks (Brown Sugar Oatmilk Espresso FTW). Sales of its sustainable milk ~2X'd in 2020 from 2019. Oh, and it filed to go public this week.
THE TAKEAWAY

Food is a change-maker... UN climate head Christiana Figueres sees the food industry as "one of the main levers of change" on global warming (she's also on Impossible's board). Alt-meat companies like Impossible and Beyond are explicitly targeting meat eaters who want to cut down — not vegetarians. If they succeed in full-mainstreamification of alt-protein, it could make a big difference. The plant-based meat industry is already a $20B biz, set to grow to $23 billion by 2024. But these companies still face pushback from the "real" beef and milk industries.

Crypto

Et tu, Bitcoin?... When we hear "carbon emitters," we think of industries that have been around for 100+ years. But there's a new, "sneaky" carbon emitter on the scene: cryptocurrency. While crypto isn't on the same level as agriculture, transportation, and manufacturing, it's not great for the environment. Crypto mining uses tons of electricity... which is mostly generated by burning fossil fuels, like coal and gas.

  • Wild stat: Bitcoin alone accounts for 0.5% of global electricity consumption — more than entire countries like Argentina and Holland.
  • Wild(er) stat: A single Bitcoin transaction generates the same amount of carbon as ~1M Visa transactions — or 78K hours of YouTube binging.

Electricity vacuum... When Bitcoin was created by the mysterious Satoshi Nakamoto, he/she/they wanted to ensure people wouldn't use it fraudulently. Enter "mining"... People mine Bitcoin by using a massive amount of computing power to verify transactions on the blockchain. Special mining computers solve complex equations, making quintillions of attempts per second to verify the legitimacy of transactions (read: major energy suck).

  • While crypto hasn't been a big target of environmental pressure/criticism (yet), a few companies are already working to reduce its footprint.
  • Seetee, a Norwegian investment company, said it planned to invest in cleaner energy (like wind and solar) to power mining operations.
  • Also, there are new ways to conduct greener Bitcoin transactions. Like: “the Lightning Network,” a payment channel that uses less energy.
THE TAKEAWAY

As Bitcoin grows, so does the energy drain... While retail and corporate investors pour into crypto, the total value of the crypto market has doubled since January to $2T. Companies like PayPal started accepting crypto payments, while others added BTC to their balance sheets. Growing Bitcoin activity could make it hard for certain countries to meet environmental goals. Meanwhile, 95% of millennials are interested in sustainable investing, according to Morgan Stanley. Growing interest in ESG investing could amp up pressure to green-ify crypto.

Transport

A gassy journey... Car, truck, ship, train, bus, or plane — burning gas is usually required to get from Point A to Point B. Not-so-wild stat: transportation is the largest contributor of GHG emissions in the US (28% of the total). The solution is simple, but also complicated: reduce reliance on fossil fuels.

Turn me on with your electric wheel... The world is far from ditching gas entirely, but companies are laying the groundwork for an electric future.

  • Consumer EVs: GM set an ambitious 2035 target for phasing out gas vehicles from its lineup. Volkswagen said it'll slash the cost of batteries (the priciest part of EVs) by up to 50% by 2030, making them cheaper than gas cars. Tesla delivered a record-breaking 180K cars last quarter. Nio (aka: the "Tesla of China") said deliveries more than doubled to ~45K.

  • Business EVs: Amazon ordered 100K electric vans from Rivian, the largest order of delivery EVs ever. It's promising to become carbon neutral by 2040. GM unveiled a futuristic delivery solution, complete with electric pallets and a fresh fleet of e-vans. FedEx pledged to replace 100% of its mail fleet with battery-powered vehicles by 2040. Meanwhile, Tesla, Nikola, and Volvo are working on electric semi trucks for long hauls.

  • Electric planes (?!): Airbus is working on alternative propulsion systems for e-planes, laying the groundwork for zero-emission flights.

THE TAKEAWAY

Policy is powerful... And it's moving the needle for sustainable transportation (and the companies behind it). Major governments — from CA, to Japan, to the UK — have said they'll start to ban the sale of new gas-powered vehicles in the 2030s. Meanwhile, President Biden's $2.3T infrastructure proposal includes EV rebates and a network of 500K electric vehicle chargers. Government incentives for buying green could accelerate the move away from fossil fuels.

What else we’re Snackin’

  • Earthy: The US is expected to unveil an updated carbon pledge to halve carbon emissions by 2030 at President Biden's virtual climate summit.
  • Yikes: Pfizer identified knock-off versions of its Covid vaccine in Mexico and Poland, as criminals try to exploit the vax rollout with fake shots.
  • Heard: Clubhouse's monthly downloads plunged 72% in March, after the buzzy social audio app hit nearly 10M downloads in February.
  • Ouch: Credit Suisse was reportedly exposed to $20B of investments related to Archegos, the firm that recently caused a major stock selloff.

Snacks Daily Podcast

"Self-driving cheese has arrived."

Domino’s, Chipotle, and Walmart are making big moves in autonomous delivery. Tune in to our snackable 15-minute pod for more.

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Snack Fact of the Day

If Americans traded beef for beans, it would free up 42% of US crop land

Thursday

  • Earth Day
  • Weekly jobless claims
  • Earnings expected from Snap, Blackstone, SAP, and AT&T

Authors of this Snacks own: Bitcoin and shares of Tesla, Square, and GM

ID: 1616388