Michael J. Coren – What COVID-19 Means for the Health our Planet

Borna (ClimateAi) 0:03
This is Agriculture Adapts by ClimateAi. Every week we speak with industry leading executives and farmers, not academics to get a 360 view how the agriculture sector is innovating to stay ahead of a changing climate. I’m your host Borna Poursheikhani, and I am your co host Himanshu Gupta. We’re a team of climate scientists and agriculture entrepreneurs trying to make farming more resilient, profitable and equitable as we transition to a new age of agriculture. This podcast is our journey as we explore the hurdles and opportunities that lie ahead for the industry to feed the world. Hello, and welcome to another exciting episode of agriculture adapts with us today we have Michael Coren, a reporter at Quartz and international news organization. Michael focuses on climate change and the people technology and policies addressing it Michael, thank you for joining us. Happy to be here. Thank you. So for this episode, we are finally going to address the COVID situation which Michael has been covering in depth over the past few weeks. And we’ll talk about its impact on climate and pollution. But Michael has also done some awesome work with forest carbon sequestration, which we have not talked about yet on this podcast. So we’re going to tap into his knowledge there first, we can’t let that slide. And then we’ll dive into COVID. But first, Michael, tell us a little bit about your journey into the world of climate.

Michael (Quartz) 1:20
So I started off as a science reporter, I was at a bunch of newspapers, and I ended up in Cambodia for about two years. were reporting on politics and corruption, but also a lot of forestry and environmental issues. After that, went to CNN and that was really where I got started. I was the science editor there and was producing a special report on climate change. And I realized I didn’t really know what I was doing. I had like, you know, a basic understanding of the science but after I finished that I wanted to go deeper. So I went to grad school, I studied economics and ecology, essentially, and I got really into four string carbon markets. So I spent the next three years actually working on that topic. I did my research in Indonesia. And then I worked for the World Bank briefly. We’re focusing on something called reduced emissions from deforestation and degradation. So basically paying for ways to keep forests in the ground through carbon markets, and work with climate focus. So that was a consultancy based in the Netherlands. And I’ve been doing that for a while. I have my own company briefly. And then I went back into journalism and I’ve been focusing on the combination of economics tech environment science.

Borna (ClimateAi) 2:28
Awesome. Before we move on to Coronavirus tell us a little bit more about your work with is it red plus, is that how they pronounce it? Is it like the shortened version? That’s the short version.

Michael (Quartz) 2:36
So the idea here is that you can use carbon markets to channel finance into forest conservation and reforestation. So the programs are called Red reduced emissions, deforestation and degradation. There’s a un version and then there’s also a voluntary market version. And in many cases, the places where forests are being cut down. They’re only marginally profitable, it might use that to land for a year to farm some and then move on. And they’re worth a lot more to the world standing as actual ecological service. And so the idea here is can we use carbon markets? Can we use international financing to pay for new forests, restoring them, as well as preventing them from being cut down?

Borna (ClimateAi) 3:18
So you said people were farming that land and then moving on what was the land then being used for?

Unknown Speaker 3:22
Often it’s at the edge of sort of the forest frontier. So these are forest lands in Amazon, in Borneo other places in Asia. And it’s usually not very productive. And so you might only get a few years of agriculture and then it becomes a cropland or it’s abandoned entirely. And it’s difficult to restore. And so it’s a very poor use of land. And it’s not ultimately particularly profitable for anyone, but it is driven by poverty and the need for people to make a living. And so this was a way to find a better business model.

Unknown Speaker 3:55
Why is that deforestation still expanding? Is it that once you cut the trees down, the land is free. For three years or something like that, and then if the cut back or

Unknown Speaker 4:03
so the land itself isn’t fertile. What makes it fertile is the process of cutting those trees down using that ash. And then it only has two or three years before that’s exhausted. And so they need to move on to plant the next row of crops. Gotcha. Other times, it is politically and financially attractive just to export the timber and get one or two years of cropland on it. But it’s not like places in the US or Europe where you have highly intensive farmer lots of inputs, this is slash and burn you plant once and then you move on.

Unknown Speaker 4:34
Gotcha. So it’s built into the system to need to continue to expand. But this program is setting up a way to incentivize not doing that basically, precisely, how exactly are they quantifying the carbon that’s being stored.

Unknown Speaker 4:44
So there’s two elements to it. One of them is the actual physical monitoring of the environment. And so what you’re looking for is how much carbon is stored in the biomass of the trees and the vegetation itself. And that’s technically difficult, but conceptual relatively straightforward, is you’re just basically trying to find carpet density by you’re doing either field surveys or going down to those areas doing plots. And then extrapolating from a statistically significant sample, how much carbon is on the ground. Of course, that’s not particularly efficient. And so you’re often using trying to use remote sensing to do this. We’re using everything from satellites, which are obviously like, you know, very broad, but not very precise, down to LIDAR, which is using, you know, laser imaging, essentially, from airplanes to get a very precise, but slightly more expensive survey. The second piece is is actually much more difficult. And we get the details of that too. But that question is from the reduced emissions piece. So you’re not just measuring how much more carbon did I did I grow, you’re actually measuring Well, how much would have been cut down if we didn’t preserve this if we didn’t finance this? And that is very difficult because you’re trying to set these sort of theoretical baselines over time. I’m curious what the what you see as kind of The main drawback or the main downsides of the red program, one of the major qualms that people have with it, like are people getting credits for a forest that is inevitably going to be deforested at some point or like, what are the major issues that people have surfaced about this program? Well, one of them is just basically, where’s the money gonna come from? So it’s around, if you wouldn’t get a global emissions cut of around 50%, that would cost about 20 to $30 billion per year. It’s estimated, so figuring out where that money comes from internationally, either, you know, through the climate negotiations process, or in the private sector is a big question mark. Another one is, as I mentioned, setting baselines. So let’s put aside for a second sort of reforestation in a forestation in the case, that’s basically regrowing forests or enhancing forests that already exist. When you have a standing forest and you need to figure out well what would happen in the future if we did not finance this conservation project. You’re inherently in these in this very uncertain In territory, and so the process of setting baselines is a very difficult process. And I don’t think we’ll ever be precise. And the third thing or the third sort of bucket are issues like leakage and non permanence and monitoring. And this is basically, if I stop deforestation here, will it go somewhere else? And not you know, non permanence is essentially like, Who’s going to make sure that this stays here for the next hundred years? And issues like that. So this is not a straight forward execute execution, even though it’s conceptually simple.

Unknown Speaker 7:32
Yeah. Also 20 to $30 billion dollars a year for 50% emissions reductions

Unknown Speaker 7:37
from deforestation from Okay, I

Unknown Speaker 7:39
was like, that’s, that’s nothing we should we shouldn’t be doing that right now. We shouldn’t be all over that.

Unknown Speaker 7:45
And that’s one of the big attractive things about land use, especially forestry is like, you get a big bang for your buck, but man, the devils in the details, how do you make sure you have a rigorous process so you’re not flooding the market with cheap credits that don’t do anything?

Unknown Speaker 7:57
Make sense? Okay, well, let’s jump over To the Coronavirus issue. So today is Earth Day and I actually just did a post for climate AI on LinkedIn talking about how it’s funny how this is probably the cleanest Earth Day we’ve seen in decades. You know, we’ve seen huge reductions in Antarctica and co2. La has had some of the cleanest air in the world in the past few days. People in Beijing are starting to see the sky for the first time Venice has clear water, people in Punjab, India are seeing the Himalayas from their houses for the first time in 30 years. And so, I want to bring up this issue of how is Coronavirus impacting pollution and climate change and environment? This is a big question. And we’ll we’ll dig into this further. But at a high level, what are you seeing you’ve done a fair amount of writing on this? So what are you seeing with regards to the impact of the COVID virus? You know, obviously, the first effect is what you just described is that you’ve seen a massive reduction in pollution across the board. So all the particulate matter that’s obscuring, you know, your views that’s causing a ton of health problems has in some places gone down by 40 50 even 80% interested enough to health

Unknown Speaker 9:02
benefits from that as such, it’d be huge in the in the hundreds of thousands of lives. And so we’ve seen this massive reduction in pollution from reduced industrial output reduced transportation. We don’t know exactly what that looks like overall. But the latest estimates I’ve seen, potentially on the order of 2 billion tonnes, so that’s 5.5% drop in emissions, which is huge. And it’s still not enough to get us to 1.5 degrees Celsius, but it is probably the biggest one year drop in history,

Borna (ClimateAi) 9:33
just for our listeners, I want to clarify something. So there’s two different when we talk about pollution and climate change, they can often be two separate issues, largely caused by the same stuff a lot of the time, but, you know, pollution and the stuff that we talked about in terms of particulate matter, that stuff that kind of affects your lungs, it can it can cause asthma, it causes respiratory ailments, and then emissions that are causing climate change that’s like carbon dioxide. And so there’s there’s a difference between these two, but the value that you gave in terms of hundreds thousands, hundreds of thousands of lives being saved is absurd because we don’t often think about that. But for I think 4.5 million people die per year as a result of air pollution. And if you put that on the scale of Coronavirus, it’s finding that like the quarantine that we’re seeing right now might be saving more lives because of the reduction in pollution than it is because of actually preventing people from getting carnivores. It’s possible,

Unknown Speaker 10:23
you know, uncheck the Coronavirus would likely kill more, but completely unchecked. But But you’re absolutely right there, there’s going to be a huge life savings just from reducing the amount of NOx and ozone, particulate matter. And that’s basically because people’s lungs will be absorbing all that pollution that leads to heart attacks and other types of death. So

Unknown Speaker 10:44
yeah, and what’s what’s interesting to me is like I wonder if, I mean we kind of became complacent with a lot of these issues with with dirty skies, dirty water. And we became complacent to these issues over a span of like 10s of years. And then now overnight, people are getting kind of like the ideal situation back And I wonder if what the lasting impacts of this we will be. I wonder if like when the dust settles, people are gonna say, Wait, I want to still be able to see that mountain range from my house. You know, I want that clean air back. I don’t want to have my asthma attacks once a month happening in LA and I wonder what the impacts will be long term of this. What do you what do you see?

Unknown Speaker 11:17
I see two things happening. I guess the first is that at least the United States, we’re doing the opposite. We actually are not while the emissions have fallen, because they’re just simply as less industry and less burning of fossil fuels. We’re actually relaxed. A lot of pollution controls or the Trump administration is letting companies emit more of those particulates and other pollutants and in particularly important neighborhoods, where they have less political power, you know, I don’t think see things improving significantly. That said, for other reasons, such as I think like transportation, we might see long term changes. So there’s a slow streets initiative that Oakland and other cities are doing across the country that are shutting down hundreds of miles of streets to cars. through traffic and letting people use them essentially as open public spaces. And I don’t think that will be going away, at least not entirely. And I think there’s going to be a slow but steady transition away from the car away from some of what you just described to more livable cities and more livable spaces.

Unknown Speaker 12:18
So we’ve been talking about the pollution component, what about when we switch back to the emissions components? So the stuff that’s causing global warming and causing climate change? How do you see that playing out?

Unknown Speaker 12:28
So it’s primarily carbon dioxide? And, you know, I think historically, the answer would have been nothing, I think it would have been a blip. And we move on. And that’s basically been true for almost every economic disruption since I think the Great Depression. In fact, you might see a temporary, you know, at most multi or drop an emissions and then a steady resumption on the exact same trajectory as before. I think there’s competing arguments here and no one knows for sure. So I will give you the scenarios rather than a prediction. I think the business’s usual scenario is that we don’t really have a substitute for gasoline and jet fuel right now not an effective one. at scale, electric vehicles are obviously popular and getting more popular, but there’s still a fraction of the total stock. And so there’s not an easy way to replace all of that. However, on the flip side, we’ve now seen probably the worst financial shock to the oil and gas market that we’ve ever seen. And it’s both a combination of supply and demand. And we get into the details, but essentially, you’re seeing oil companies come under enormous financial pressure, and investors are seeing, you know, huge losses in the industry. Before 2018. It was, it was accepted wisdom that you will make more money investing in fossil fuels and renewables. That has not been true in the last two years. And in the last three months, the gap is is just enormous. And so we may see a more permanent shift away from the fossil fuel sector towards clean energy. From an investor perspective, that doesn’t mean emissions, you know, will go down immediately. But it does put the country on a different or the world, different trajectory potentially in terms of developing out one or the other resource.

Unknown Speaker 14:16
Yeah. Tell us a little bit more about the oil and gas prices that we’ve been seeing why prices have plummeted? My understanding that it’s in large part due to Coronavirus and decreasing demand in China. Can you tell us a little bit more about that?

Unknown Speaker 14:27
Sure. So it’s called a supply and demand shock. So on the demand side, basically, as countries shut down their economy as they stopped burning gas, that’s, you know, airplanes, diesel. And so you suddenly have, you know, 30 or 60% drop in transportation demand. And so that created a large surplus relative to what they’re pumping. At the same time. OPEC, OPEC, plus, as they were calling it sort of dissolved, and Saudis and the Russians decided to open up the taps and basically pump as much oil as they can. flooding the market. And so you have this, you know, dual sort of tool pressures moving the same direction. so massive, massive oversupply, and really nowhere to put it. And so, oil has been flowing into basically every place that can be stored, whether it’s ships or barrels for or large tanks, as you saw prices went negative this week. And the reason was that people just didn’t want take delivery for the oil that they bought months or even years earlier. And so they’ve got to find a way to place to put it and so to negative $30 a barrel. I mean, that’s basically the storage cost to get that off people’s hands.

Borna (ClimateAi) 15:37
And a lot of our listeners come from the agriculture sector, so they’re not super familiar with the energy maybe Can you explain why renewables are better at weathering through the storm than fossil fuels are

Michael (Quartz) 15:50
so the marginal cost of a unit of wind or unit of sun is zero? It doesn’t cost anything to get to get them all the costs. In essentially the upfront installation, and then the maintenance over time, and that’s not true with oil necessarily. And that you’re you’re basically paying for a constant supply of a commodity that is being traded around the world. And you essentially have these huge price spikes, because you’re subject to both, you know, the suppliers, which are often a cartel, as well as demand, which, as you can see, can can change very differently. That’s not to say renewable energy doesn’t have issues. Obviously, there’s some times it’s sporadic in terms of when it generates and not all the markets or need all the energy all at the same time. But generally speaking, we’ve just seen a much more stable sort of price environment for renewable electricity.

Borna (ClimateAi) 16:45
Yeah, so basically, wind and solar has just play a free fuel source just using this natural resource that’s naturally occurring. And so the the marginal cost, which is like how much do you pay for one more unit is free. It’s mostly just an upfront cost minus summation. Work Yeah.

Michael (Quartz) 17:00
And then you obviously got to sell into the market and which is the markets fluctuate but you’re not seeing the same thing as you do in oil and gas.

Borna (ClimateAi) 17:06
Right. And so we’ve been seeing over the past decade for the most part, a lot of coal plants going out of business and this has accelerated Yeah, recently. Why is that? Can you explain why Coronavirus has helped accelerate that?

Michael (Quartz) 17:20
I think I wouldn’t even attribute most of it to Coronavirus. This has been an ongoing trend. And essentially what it what it has done is it’s winnowing out the weak. It’s happening in shale oil in the US where you know, oil dropped below $50 a barrel, which is about the breakeven point. And for coal plants, it’s just not making their life any easier. So they were already under enormous pressure because they were being outperformed by cheaper solar, wind and natural gas. So in many cases, they’re just not the cheapest provider except in a few places in Wyoming and the west where they have easy access to cheap coal. And then there has also been a remarkable flight of capital from the Coal sector, more than 100 international financial institutions have now said they will not do business with the coal sector or restricted who they will do business with. So if a coal company wants to finance their expansion or mergers, mergers and acquisitions or even find insurance, they’re having a harder and harder time doing that. So I think last week, or two weeks ago, Georgia killed the last us coal power plant proposal. It was a $2 billion 12 year project that’s now off the table.

Borna (ClimateAi) 18:29
But what’s interesting is that a lot of these coal plants and these fossil fuel plants in general, so right now it’s, in a lot of cases, it’s cheaper to build renewables to build solar and wind. But these, these plants are set up to last a long time. So is this anything meaningful, the amount of decline that we’re seeing in coal, I think it is,

Michael (Quartz) 18:46
I but you know, you make a good point, it’s not going to solve the problem. So now that we’ve stopped the new power, coal power plants in the US, what does that mean for the rest of them and especially abroad and the answer abroad, actually, India and China We’re gonna start, they’re gonna keep building those things because not because they’re profitable, but because they are employment machines. And so they keep people employed and they lead to political stability. And so put that in one, you know, one bit one bin, but in terms of phasing coal out in Europe and the US and other countries, that’s going to be a political decision. It’s not until 2030 2035, maybe even later, where operating a coal power plant will be more expensive than building new renewables. If the world is serious about phasing out coal, it’s going to have to be basically a way to accelerate the depreciation of those assets. If they’re publicly owned utilities, or, you know, you’ve got a deregulated market where they just go out of business because they can’t compete. Yeah, makes sense. What does this price war mean for oil and gas company? So the general structure is that, you know, Saudi Arabia and Russia have a ton of oil that’s easily pumped. Whereas in the US the shale oil which you mentioned, requires more effort and is thus more expensive to sell. So To cut even they need to sell for a higher price. So how is this going to affect the oil and gas companies? Well, I saw that the shortage of oil but as you said, there’s a shortage of you know, cheap oil, at least in the US. Because essentially the Permian Basin in Texas, you’ve got a bunch of independent oil and gas producers, who are haven’t made any money for themselves or investors in 10 years, the basically they’ve been borrowing or taking equity, in the hopes that one day they would turn a profit and they haven’t. And they’re now so deep in debt, and they just do not have a viable way out that it’s unlikely that all of them or most of them even will emerge from this. So you’re probably probably going to see this wave of bankruptcies, or restructurings and the the major oil companies that can actually pump that oil and make use of it at a cheaper, cheaper cost will probably start to own those assets. Interestingly, the banks who have lent to these oil companies are already setting up independent firm’s to manage those oil assets, if and when they go go bankrupt, because they don’t want to sell them at depressed prices. And so we may end up in a very strange situation where Citibank Wells Fargo and JP Morgan are some of the biggest owners of oil wells in Texas.

Borna (ClimateAi) 21:16
You know, what’s interesting is that public perception of the situation is likely in the exact opposite direction. So investors were putting money into this stuff or saying, time and time again, we’ve seen oil and gas and coal not be resilient to these shocks. And then you have consumers who are saying, oh, gas is cheap. I want more of this right now. So I wonder like, is this is this pushing off? purchase of like electric vehicles? Is this pushing off electrification and the drive of renewables? Just from the consumer side? Are we gonna have less political will because of this?

Michael (Quartz) 21:44
It’s a great question. You know, I think historically, you’re you’re right, that lower gas prices basically encourage people to drive more, and certainly don’t, don’t encourage either fuel efficiency or electric vehicles. I think that narrative isn’t necessarily true today. It is true to some degree, but I’ll give you a counter example which is Norway. Norway always had high gas prices and then they basically subsidized electric vehicles, not only with cash but with perks, so you get free charging and free access to certain highways. And I think last year, you know, 50 to 60% of new cars sold in the country or electrics so this clearly it’s it’s not just

Borna (ClimateAi) 22:26
50?

Michael (Quartz) 22:28
50, so so that’s that is they are by far the furthest along in terms of Eb Evie penetration in the United States, California’s for this along around five or 6%. But I guess my point is, it’s not just about price. And I think as Evie has come on the market that are both attractive and affordable and people want them then it won’t have the same effect. You won’t see people deciding not to get them and you know, you could think Tesla for most of that. It’s just they build cars that people want at any price. And that’s never happened before the vs. And now everyone’s following them. And once you get a market place that has, you know, dozens or hundreds of models, I think you’ll see, you know, penetration driven by people wanting those cars more than just what’s the price of gas.

Borna (ClimateAi) 23:14
So one more thing I want to go into here is the stimulus bills and the government aid we’re seeing be distributed to help deal with Coronavirus. So historically, these bills have been great ways to pass measures to fix some sort of problems in any given industry. And this is not just for climate or agriculture. This applies across the board. But I’m curious what kind of climate legislation you’re seeing, making it into these big stimulus bills.

Michael (Quartz) 23:38
Basically, there was talk right away that the rescue or the relief bill should include some conditions on how the money is spent some you know, environmental conditions, and potentially some money flowing into clean tech. That hasn’t happened and it probably will not happen for at least maybe one maybe more. Um, sort of cycles because you have a, you know, basically Republican opposition to anything that isn’t tailor focus to, you know, basically I think getting through to the next election, the stimulus, it was hard for the democrats even to get testing in there to the idea that they’re going to conditions attached to bail outs, you know, greenhouse gas conditions attached to bailouts, it seems unlikely. Obviously, that would be a huge win for the clean tech community. Because, as you saw with the first stimulus bill in 2008, it radically changed the sort of the game for the renewable energy sector, which hardly existed before. All that money flowed into basically commercialize a lot of technologies that were just sort of languishing.

Borna (ClimateAi) 24:42
So what do you think the lasting impact of all this will be like, what kind of I mean, society has basically drastically changed overnight when I’m watching a movie and I see people High Five I gasp and it’s there’s a lot of stuff that has changed on a personal level as well as on a societal level and I’m curious what you think the last thing impacts of all this will be like what, you know, when we’re going through airports? Are we going to see people, you know, how TSA evolved drastically after 911? Are we going to have like health screenings at TSA? You know, do you think? I mean, I’ve been thinking a fair amount about this issue. I’m like, I wonder if jail sentences will get reduced not by any conscious measure, but just by level of empathy that people can feel with being isolated for so long. And so I’ve been trying to think through like, what are the major ways that society and culture will change? And I’m curious if you’ve given that question, any thought I have.

Michael (Quartz) 25:29
I think, you know, I’m flying as blind as anyone else. But I think we’re already starting to see even in the way that we’re communicating virtually online, I think that even more of our lives will move into something like virtual communication, the idea that we have to travel to go places that we have these massive events that trade shows go on for three days that you know, I think that work travel is a perk in a way that is today. I think all of that starts to change drastically. And we get much more of these sort of hybrid systems. where, you know, we we all work from the office part of the time at most. But working from home or working from elsewhere is basically standard, at least for, you know, a portion of population that that’s feasible. I mean, I think that the social safety net will, this could be a situation, let’s say that the most radical change that I could envision is this situation like the New Deal, where the Great Depression happened. And you had, you know, basically a massive social demand for government intervention in the economy and in the welfare of society. And it took years to get there, but it did happen. And we’re now seeing economic dislocation that might be as big as the depression. So something could happen in return.

Borna (ClimateAi) 26:45
And it’s interesting how I opening it’s been like there’s been, we talked about kind of like the cleanliness of air and the water that has come about as a result of people not using their cars not using boats, reduced emissions from power plants, but there’s also like on the air Culture aside, there’s a huge amount of food being wasted today. And some of that is because of demand shifts 30% of food is wasted today. And so I think a lot of that our eyes are just being open to these problems that were already existing and, and of course, these problems are being exacerbated further by the Coronavirus, but it’s interesting to see people’s eyes be opened to a lot of issues that were already present before in a way that was not previously possible.

Michael (Quartz) 27:24
I think that’s true. And it’s not just food obviously, like all of the cracks, all of the problems that existed before Coronavirus are being exposed in a visceral and you know, just very immediate way and I don’t know if that will lead to change. I’m a little bit you know, pessimistic honestly about about how much our attention span and you know, whether things yeah, we can sustain the changes that we’ve made, but I i do think that this is one of those few times in our lives where things have changed so drastically that drastic change is possible. If after 22 We’ll know a lot more, I think.

Borna (ClimateAi) 28:01
Yeah, I agree. And I think that, you know, people like you who are kind of doing the reporting in the journalism that that plays a huge part in spreading the story and getting the word out. So, so thank you for your help. In terms of that, just on behalf of society, thank you, thank you for your work. And I wanted to ask if there’s any way people can can support you in your work?

Michael (Quartz) 28:22
Sure. So you know, I always love to talk to people. My email, is that M JC at QC.COM And my Twitter is probably the easiest place MJ underscore Coren. And I’m, you know, covering climate and really interested in figuring out, you know, what’s next in terms of emission reductions and solutions to the climate challenge. And so if you guys have ideas, I’m always open.

Borna (ClimateAi) 28:49
Alright, Michael, thank you so much for joining us today.

Michael (Quartz) 28:51
My pleasure. Thank you.

Borna (ClimateAi) 28:53
Hey, everybody, thanks for listening. If you have any feedback, or you’d like to add your own two cents on the topic discussed today, or If you’ve just got your own ideas about something that we should discuss in the future, please feel free to shoot me an email at podcast@climate.ai. At its core, this podcast is just a way for us to learn and we want to share our learnings as we go. So we’re always open to building on these conversations and hearing new perspectives. Thanks for your support and see you next time.