Feb 15, 2024 · 43m · catalyst
More 2024 trends: ESG, carbon certifications, curtailment, and AI
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gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions
In this episode of Catalyst, host Shayle Kann and climate analyst Nat Bullard break down the second half of Bullard's annual decarbonization megadeck, evaluating shifting ESG dynamics, clean power bottlenecks, supply chain constraints, and the growing grid impact of artificial intelligence.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Shayle holds 31.8% of the talking time here. How this is scored →
Shayle as informed peer 5.4 Guest teaching 2.4 Guest disagreement 0.1 Shayle pushing back 0.4
speaking balance: gold is Shayle, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 40:33 Friendly scale correction on data center load
Shayle playfully interrupts Nat to correct his singular 'gigawatt' framing, insisting data center demand in Northern Virginia represents multi-gigawatt industrial load.
Hardest push from Shayle ▶ 40:33 Shayle challenges data center load scaleShayle immediately challenges Nat's characterization of a gigawatt of capacity, pointing out that Northern Virginia data center demand far exceeds single-gigawatt increments.
Biggest teaching moment ▶ 13:14 Nat breaks down global hydro capacity factor declinesNat educates listeners on how hydro capacity factors have plummeted across Brazil, Canada, and the EU, reducing hydro's volumetric output to levels comparable to solar and wind.
Shayle holds their own ▶ 28:49 Shayle breaks down First Solar's industry positionShayle delivers an extensive historical and technical breakdown explaining why First Solar's cadmium telluride thin-film process defies standard silicon scaling rules.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Shayle as informed peer | Guest teaching | Guest disagreement | Shayle pushing back | Why |
|---|---|---|---|---|---|---|
| Analyzing Corporate ESG Reporting Quality and Disclosures | 5 | 3 | 0 | 1 | Shayle frames the political backlash surrounding ESG and synthesizes corporate reporting incentives, noting how companies quietly publish reports while dropping press releases. Nat shares granular data on page lengths and data table omissions from Harvard Law research. | |
| Trends in Sustainable Fund Flows and Capital Movement | 4 | 3 | 0 | 0 | Nat walks through Morningstar data showing five consecutive quarters of net outflows from US sustainable funds and tracks the decline of ESG mentions in Larry Fink's annual letters. | |
| Comparing US and European Sustainable Investment Landscapes | 5 | 3 | 0 | 0 | Shayle prompts a comparison between US and European sustainable investment landscapes, prompting Nat to contrast Europe's 84% market share of global sustainable AUM against the US's 11%. | |
| The Global Decline in Hydropower Capacity Factors | 6 | 3 | 0 | 0 | Nat explains the secular decline in hydropower capacity factors across Brazil, Canada, and the EU. Shayle connects the trend to grid reliability and his portfolio investment in long-duration multi-day battery storage. | |
| Examining Global Coal Additions and Peak Demand Dynamics | 4 | 2 | 0 | 0 | Nat reviews global coal additions, noting that while additions dropped from 100 GW in 2015 to 25 GW in H1, they remain heavily driven by regional policy decisions in China, India, and Southeast Asia. | |
| Addressing Power Curtailment and Grid Energy Surpluses | 7 | 2 | 0 | 1 | Shayle outlines his thesis for capitalizing on negative-cost power with ultra-low CapEx flexible industrial processes. Nat adds that retrofitting existing facilities is impractical and requires clean-sheet engineering. | |
| Proliferation of Carbon Market Certification Standards | 5 | 2 | 0 | 0 | Nat details the proliferation of voluntary carbon certification standards from one in 1996 to 37 in 2023, while Shayle agrees that the excessive standard fragmentation highlights ongoing market inefficiencies. | |
| First Solar's Distinct Market Trajectory and Thin-Film Advantage | 8 | 1 | 0 | 0 | Shayle demonstrates deep solar industry domain expertise by narrating First Solar's history as the sole survivor among hundreds of thin-film startups and explaining its cadmium telluride technology moat. Nat confirms with order book data. | |
| Biodiesel Demand and Feedstock Pressures in Europe | 4 | 3 | 0 | 0 | Nat outlines how European animal fat supplies are increasingly diverted to biodiesel, drawing parallels to historic food-versus-fuel debates as sustainable aviation fuel demands loom. | |
| Artificial Intelligence, Data Center Energy Demand, and Grid Impact | 6 | 2 | 1 | 2 | Shayle and Nat analyze data center power use efficiency plateaus and escalating AI energy demand, with Shayle playfully interjecting that a single gigawatt is tiny compared to Northern Virginia's massive regional pipeline. |
Statements from this episode (21)
Bullard: Average US sustainability reports grew from 70 to 82 pages by 2023
“The average number of pages for a sustainability report in 21 was about 70 pages. It's gone up to 80 pages, 82 pages in 23. But those report lengths range from 11 To 262 pages.”
Bullard: US ESG reports with data tables dropped to 54%
“So the number of reports that had an ESG data table, okay, like, to my mind, the minimum good grace you could give an analyst reading has gone from 76% to 54%. The number of reports that had a press release has gone down from about 76% to 50%. And now, only 20…”
Bullard: Obfuscating ESG data backfires by giving analysts more interpretive discretion
“It's also, I think, in the long run, maybe a pyrrhic victory to sort of obfuscate your data by not putting it into a table, because for one thing, people will get it, and they may be less sympathetic to your position if they had to, Do a lot of extra work to g…”
Bullard: U.S. sustainable funds saw five consecutive quarters of outflows
“Sustainable fund flows in late twenty-twenty-one in the range of, like, more than twenty billion dollars of inflow a quarter. And it's been negative for the last five quarters, which De facto means that for the entire calendar year of twenty-twenty-three, we h…”
Bullard: Larry Fink dropped ESG entirely from his 2023 annual letter
“He mentioned ESG a lot in 2016, relatively, and then again in 2021, a little bit in 2022, but by 2023, ESG never shows up at all.”
Bullard: Europe holds 84% of global sustainable assets under management
“Europe is 84% of the almost three trillion dollars of assets under management, sustainable assets under management at the end of last year, and the U.S. Is 11%.”
Bullard: Brazil's hydro capacity factor dropped below 40% in 2021
“Brazil's hydro capacity factor went from almost 60% in the early 2010, To below 40% in twenty-twenty-one.”
Bullard: Hydropower capacity factors declined significantly across Canada and the EU
“Canada's gone from, like, about a 60% capacity factor to a little over 50. The EU has gone from mid-thirties to mid-twenties capacity factor for hydropower.”
Bullard: China's 2022 thermal peak surge equaled Germany's entire peak capacity
“And the instantaneous year-on-year or year-on-year gap up in peak demand in China from the thermal fleet was the size of Germany's peak capacity.”
Bullard: Global coal additions were 25GW in H1 2023, down significantly
“There was about the first half of the year, about 25 gigawatts of coal-fired power generation capacity added around the world, which is down from more than a hundred gigawatts added in 2015.”
Bullard: California solar curtailment exceeded 600 GWh in April 2023
“That we curtailed more than 600 gigawatt hours of solar in I think it was in April of twenty-twenty-three, up from in twenty-twenty, like, half that much.”
Kann: Monetizing curtailed power requires low CapEx and power-heavy processes
“You do something worthwhile where you can afford the A very low capacity factor, which means that you need to be extremely low CapEx relative to OpEx, and OpEx should mostly be electricity. In other words, most of the cost of the thing that you want to produce…”
Bullard: Carbon certification standards grew from 1 in 1996 to 37 in 2023
“In 1996, we had one carbon certification standard. In 2023, we have 37 of them.”
Bullard: Long-term carbon markets need better application of standards, not more standards
“I don't think that in the long run, markets are asking for more standards. They're asking for better application of a number of standards.”
Kann: First Solar is the only surviving Western thin-film manufacturer
“In fact, there is only one Western thin film solar manufacturer still today, and very few Western-based solar manufacturers, period.
And so the only one that has made it through that gauntlet for this long is First Solar”
Bullard: First Solar's quarterly order book grew from 10GW to 80GW
“In 20 21st solar's quarterly order book was about 10 gigawatts.
And its most recently quarterly order book was 80 Gigawatts.”
Bullard: North America makes up nearly 80% of First Solar's pipeline
“North America, read mostly the United States, is almost 80% of the new potential booking opportunities.
That First Solar sees, not just of its book, but of what it sees happening in the future.”
Bullard: Nearly half of Europe's animal fat supply goes to biodiesel
“But in the most recent print of data here from Transport and Environment in the UK, like, almost half of Europe's animal fat supply is not going towards biodiesel. And that's really significant because it's gonna start crowding out these other uses for it.”
Bullard: Google data center power usage effectiveness has plateaued since 2021
“PUE is now pretty much flat when you adjusted for seasons since the 21. This is data from Google's data centers, and they're about as transparent as you can get with this figure.”