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Ghana and Ivory Coast draw up plans to stop cocoa deforestation
 The world’s chocolate industry is driving deforestation on a devastating scale in West Africa, the Guardian can reveal.

Cocoa traders who sell to Mars, Nestlé, Mondelez and other big brands buy beans grown illegally inside protected areas in the Ivory Coast, where rainforest cover has been reduced by more than 80% since 1960.

Illegal product is mixed in with “clean” beans in the supply chain, meaning that Mars bars, Ferrero Rocher chocolates and Milka bars could all be tainted with “dirty” cocoa. As much as 40% of the world’s cocoa comes from Ivory Coast.

Q&A How does 'dirty' cocoa end up in our chocolate? Show The chocolate industry works mainly as follows: small-scale farmers grow cocoa on plantations, many of which are illegal as they are in national parks or protected forests. They sell it to middlemen with motorbikes known as ‘pisteurs’, or direct to buyers in local towns. These supply traders, which are often multimillion-dollar companies, which in turn sell to big chocolatiers. There are so many transactions in the supply chains that big brands sourcing from implicated traders cannot be sure their product is not contaminated. Was this helpful? Thank you for your feedback.

The Guardian travelled across Ivory Coast and documented rainforests cleared for cocoa plantation; villages and farmers occupying supposedly protected national parks; enforcement officials taking kickbacks for turning a blind eye to infractions and trading middlemen who supply the big brands indifferent to the provenance of beans.

When approached for comment, Mars, Mondelez and Nestlé, and traders Cargill and Barry Callebaut did not deny the specific allegation that illegal deforestation cocoa had entered their supply chains. All said they were working hard to eradicate the commodity from their products.

00:43 Ivory Coast deforestation

Up to 70% of the world’s cocoa is produced by 2 million farmers in a belt that stretches from Sierra Leone to Cameroon, but Ivory Coast and Ghana are the giants, the world’s first and second biggest producers. They are also the biggest victims of deforestation. Ivory Coast is losing its forests at a faster rate than any other African country – less than 4% of the country is covered in rainforest. Once, one quarter was.

The ballooning global demand for chocolate means that if nothing is done, by 2030 there will be no forest left, according to the environmental group Mighty Earth which today publishes an investigation into deforestation caused by chocolate. The final, insulting irony is that locals are so poor they could never afford to eat a Mars bar.

Evidence of deforestation is not hard to find. Inside the Mount Tia protected forest, Salam Sawadougou, a Burkinabé farmer, is hacking a yellow cocoa pod off one of his plants in a four hectare (10 acre) plot. Here, the grey stumps of enormous ancient trees are all that is left of the forest.

“I burned it little by little,” Sawadougou says, explaining that his cocoa needed full sun to grow. Farmers generally believe that recently deforested soil produces the biggest beans, so they remove the trees one by one, planting more cocoa as they go.

In recent years, the annual rate of deforestation inside parks has doubled, and in both Ivory Coast and Ghana, it is going twice as fast as deforestation in unprotected areas.

Cocoa is a monster that will eventually eat itself, scientists say. Farmers will miss the trees they cut and burned down for the very reason that their shade would have protected their cocoa plants from increasingly parched, dry seasons, driven by cutting down trees.

When approached for comment, most big companies acknowledged the problem of deforestation for cocoa production and said they were committed to tackling the problem.

Barry Parkin, chief sustainability officer at Mars, said: “We are committed to identifying the best ways to end deforestation and forest degradation in the global cocoa supply chain.

“We know that sustainable cocoa is too big a challenge for any one company to address. That is why we are partnering with others in the industry to try and drive change at a global scale.”

Nestlé said it was “opposed to the deforestation of rainforests and peatlands around the world. Nestlé regards it as one of the most serious environmental challenges facing the world.”

It noted that in 2010 it had pledged that none of its products should be associated with deforestation, and added that it supported international moves to secure zero net-deforestation by 2020.

Mondelez’s Cathy Pieters said that deforestation in supply chains was something they were actively trying to root out.

“We all recognise the urgency, and we all acknowledge the issue,” she said. “As an individual company we have probably worked the longest on this. We are exactly in the middle of that process, because of the urgency and the need for a solution.”

Hershey said it was committed to sourcing 100% certified, sustainably sourced cocoa by 2020. “We take concerns about deforestation and forest degradation very seriously,” said spokesman Jeff Beckman.

Ferrero did not respond to request for comment.

Cocoa dries outside the chief’s house in the illegal village of Zanbarmakro in the Marahoué national park, Ivory Coast. Photograph: Ruth Maclean/The Guardian

The cocoa traders Cargill said: “We have made a pledge to end deforestation – and we are committed to delivering.” The company added that it was aiming to ensure that more than 70% of its Ivory Coast product would be third-party verified or certified by the end of next year.

Barry Callebaut, another trading firm, pointed out its commitment to be 100% deforestation free by 2025.

It added: “For any global company/industry commitment to succeed, the boundaries of the national parks and forêt classée [classified forests] need to be redrawn or reconfirmed for an area equivalent to its original designation. The redrawn or reconfirmed boundaries need to be legally enforced by the governments.”

Many cocoa industry players – although not all – have pledged to end deforestation and forest degradation in a collective statement published in June. But this is a vague promise to try harder, while the real test will be the contents of the framework for action presented at the UN’s Convention on Climate Change in November.

A captive monkey, one of the last remaining in Mount Tia protected forest, Ivory Coast. Photograph: Ruth Maclean/The Guardian

Some of the farmers growing cocoa inside protected areas have been living there for decades, and how to resettle them and find them a new means of making a living is one of the major problems that the government and the industry need to work out in November.

None of the companies said they would support a moratorium on deforestation cocoa, despite the fact that one on soy worked well to stop deforestation in the Amazon. Neither did they say they would commit to 100% shade-grown cocoa.

Government commitment to protecting national forests is also key. “Companies alone can’t solve this, and the government alone can’t solve this,” says Richard Scobey of the World Cocoa Foundation.

The situation inside the country’s 231 classified forests is even worse than in the parks, and this has partly to do with the different authorities that run them.

The government-funded agency protecting forests is called Sodefor; the state parks authority is the OIPR (Office Ivorien des Parcs et Réserves). Neither is doing its job. In the Marahoué park, the Guardian found repeated examples of kickbacks and racketeering by OIPR officials. In the Mount Tia classified forest, the top Sodefor official, Karma Bakary, was asked how long it would take for the forest to grow back to its former size. “One to two years,” he said. Under further questioning he upped his estimate to 10 years.

It is also the responsibility of the Conseil Café Cacao, the state regulator for coffee and cocoa, to oversee the industry, checking the quality of the cocoa, ensuring the right prices are being paid, and seeing that none of it is grown using child labour or in protected areas.

Responding to the Guardian, the Conseil Café Cacao said that it was committed to “good governance and ethics” in its activities and pointed to a programme it started, Cocoa, Friend of the Forest. There is little evidence of the programme on the ground.

Privately, activists have been warned not to touch cocoa, the backbone of the country’s economy whose vertebrae reach the highest levels of society. Those who do can get in to serious trouble. In 2004 Guy-André Kieffer, a French-Canadian journalist working on a story about cocoa and corruption, disappeared. He is believed to have been killed.

Evidence of deforestation in Mount Tia protected forest, Ivory Coast. Photograph: Ruth Maclean/The Guardian

The destruction of Mount Tia started in 2004, during the first Ivorian civil war, but its much larger neighbour, Mount Sassandra forest, remained almost untouched until 2011, long after that conflict ended.

In Mount Sassandra, farmers run away at the sight of visitors, aware that their business is illegal. But these farmers are not the ones earning the vast profits to be made from chocolate: many live in poverty, often exploited and underpaid for their crop. Most cannot even afford that basic luxury in the west: a bar of chocolate.

“It’s white people who eat chocolate, not us,” one says.

Output: The governments of Ghana and the Ivory Coast are drawing up proposals to prevent deforestation, following an investigation by The Guardian into the environmental impact of the cocoa industry on these countries. The newspaper disclosed in September that cocoa linked to deforestation had entered the supply chains of Barry Callebaut and Cargill, which sell to Cadbury, Mars and Nestle, while environmental group Mighty Earth found illegally grown cocoa was also being used by Godiva and Hershey’s. It remains unclear whether either government has the power to make traders pay for their reforestation plans.


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Ghana and Ivory Coast draw up plans to stop cocoa deforestation
 The governments of Ghana and the Ivory Coast are formulating plans to immediately put a stop to all new deforestation after a Guardian investigation found that the cocoa industry was destroying their rainforests.

The west African neighbours have been drafting new measures to rescue their remaining forests and replant degraded ones.

In an investigation published in September, the Guardian found that deforestation-linked cocoa had entered the supply chains of some of the biggest players in the chocolate industry. At the same time, the environmental group Mighty Earth published Chocolate’s Dark Secret, a report that found that “a large amount of the cocoa used in chocolate produced by Mars, Nestle, Hershey’s, Godiva, and other major chocolate companies was grown illegally.”

Corrupt Ivorian officials whose job it was to protect the country’s national parks and classified forests were accepting huge bribes to allow small-scale farmers to cut them down and grow cocoa.

This cocoa was then bought by middlemen who sold it on to large cocoa traders including Barry Callebaut and Cargill, companies which sell to Mars, Cadbury and Nestlé.

The action taken by the governments is very promising, Mighty Earth said, but will not succeed unless the cocoa traders and chocolate manufacturers put money into the effort.

“The big danger now is that the industry’s going to kick the can down the road and blame the Ghanaian and Ivorian governments and make them fix the problem without helping enough financially. But the people who have the money and the technical resources to fix it are the industry,” said Etelle Higonnet, the lead author of the Mighty Earth report.

Contacted by the Guardian, the chocolatiers Mars, the Hershey Company and Mondelez, the owners of Cadbury, did not say that they would commit any money to the governments’ plans; Mondelez pointed to its sustainable sourcing programme Cocoa Life, while Hershey said that more than 75% of the cocoa it buys is certified and sustainable, and that it would be at 100% by 2020. Mars said that “joint frameworks for action” would be released at the climate change conference, outlining “the key actions, time frames, and technical and financial commitments for forest protection and restoration in Ghana and Cote d’Ivoire.”

Under the Ivorian draft plans, which appear to be sanctioned by the prime minister’s office, these traders will each take responsibility for a number of degraded classified forests and turn them into densely shaded forest, organising farmers to plant trees while growing cocoa underneath them.

This is a far more sustainable way of growing the cocoa on which the Ghanaian and Ivorian economies rely than the current way, whereby many farmers cut down ancient trees to ensure their cocoa plantations have full sun.

As well as the effect that the decimation of west African rainforests has on global climate change, scientists say it also dramatically reduces rainfall. If current patterns continue, there will not be enough rain to grow cocoa at all.

The handful of Ivorian classified forests that have not lost swaths of trees will be upgraded to national parks, while one national park, Marahoué, is in such a bad condition that it will probably be downgraded, perhaps to a classified forest.

It is unclear who will pay for the Ivorian government’s plans. It expects the traders to pay, but has not made it clear what the consequences will be if they refuse. The number of people living inside protected areas makes it a complicated and fraught task: the government has faced accusations of human rights abuses for evicting thousands of cocoa farmers from Mont Péko national park.

In Ghana, meanwhile, the plans are far-reaching, and if enacted, could transform the landscape, though it is unclear whether those drafting them have sufficient clout or money to do so.

In addition to committing to no new deforestation, land and tree tenure reform, and transparency in the supply chain so that cocoa can be traced down to the farm gate level, ensuring that none of it comes from illegal protected areas, the government is also agreeing to the high carbon stock approach. This is a way of making decisions about land use that protects low as well as high-density forest, which means that more of Ghana’s forests can be salvaged.

However, there is still less clarity on how this will be funded than in the Ivory Coast. Cocoa prices in both countries have fallen by a third in the past year, and Ghana’s economy has been affected by low gold and oil prices too, as well as a fiscal crisis that that the IMF plugged with credit that so far totals $565m. Monitoring and replanting the forests will cost tens of millions the country will struggle to afford.

Chocolate companies and traders should pay, according to Higonnet.

“The companies need to pay for planting the trees next year. They’re likely to reap a $4bn windfall profit, because the price of chocolate bars has stayed the same but the price of cocoa is collapsing,” she said. “So what can they do with that extra money? Well, they can use it to plant trees.”

Many top players in the cocoa industry say they will release a “joint framework for action” with the governments on 17 November. But there is concern that a tightening in west Africa could just push the trade elsewhere.

“Cocoa is moving into these frontier forests,” Higonnet said, “ in central Africa, Indonesia and the Amazon – and we will keep reproducing the same disasters that we saw in west Africa unless we protect those forests now.”

Output: The governments of Ghana and the Ivory Coast are drawing up proposals to prevent deforestation, following an investigation by The Guardian into the environmental impact of the cocoa industry on these countries. The newspaper disclosed in September that cocoa linked to deforestation had entered the supply chains of Barry Callebaut and Cargill, which sell to Cadbury, Mars and Nestle, while environmental group Mighty Earth found illegally grown cocoa was also being used by Godiva and Hershey’s. It remains unclear whether either government has the power to make traders pay for their reforestation plans.


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Ghana and Ivory Coast draw up plans to stop cocoa deforestation
 Cocoa production in Ivory Coast and Ghana responsible for the owoss of extensive forested areas, endangered chimpanzee and elephant habitat

WASHINGTON D.C.– A new investigation by Mighty Earth, “Chocolate’s Dark Secret,” finds that a large amount of the cocoa used in chocolate produced by Mars, Nestle, Hershey’s, Godiva, and other major chocolate companies was grown illegally in national parks and other protected areas in Ivory Coast and Ghana. The countries are the world’s two largest cocoa producers.

The report documents how in several national parks and other protected areas, 90% or more of the land mass has been converted to cocoa. Less than four percent of Ivory Coast remains densely forested, and the chocolate companies’ laissez-faire approach to sourcing has driven extensive deforestation in Ghana as well. In Ivory Coast, deforestation has pushed chimpanzees into just a few small pockets, and reduced the country’s elephant population from several hundred thousand to about 200-400.

About half of the world cocoa market is controlled by just three companies: Cargill, Olam, and Barry Callebaut. The investigation traced how cocoa makes its way from growers in national parks, through middlemen, to these traders, who then sell it onto Europe and the United States where the world’s largest chocolate companies make it into truffles, bars, syrups, and myriad other chocolate treats.

“The extent to which big chocolate brands like Mars are linked to destruction of national parks and protected areas is shocking,” said Etelle Higonnet, Mighty Earth Campaign and Legal Director. “These companies need to take immediate action to end deforestation once and for all, and remediate past damage.”

With West Africa’s forests nearing exhaustion, the chocolate industry has begun to bring its model to other rainforest regions like the Peruvian Amazon, the Congo Basin, and Southeast Asia’s Paradise Forests.

“The ancient forests of our nation, once a paradise for wildlife like chimpanzees, leopards, hippopotamus, and elephants, have been degraded and deforested to the point that they’re almost entirely gone. This deforestation is due principally to the cultivation of cocoa. Our country has become dependent on a cocoa industry that destroys forests and the whole range of ecosystem services they offer the country. We must achieve a sustainable cocoa industry that respects forests and that actually benefits communities and the country’s economy. The big chocolate companies must make financial and technical contributions to support the government’s conservation efforts,” said SIGNO Kouamé Soulago Fernand, General Secretary ROSCIDET, a network of Ivorian NGOs specializing in environmental protection and sustainable development.

Our investigators found large villages of cocoa growers, in some cases consisting of tens of thousands of inhabitants, inside protected areas like national parks. We documented traders openly purchasing cocoa beans grown illegally inside these areas, which would then go on to be sold to most of the world’s largest chocolate companies. Despite many chocolate companies’ public sustainability initiatives, these practices have continued without any real change.

“The cocoa industry continues to exploit both forests and communities of West Africa for cocoa that is sold for large quantities of cheap, environmentally unsustainable cocoa beans. The low price of cocoa is costing us dearly here in Côte d’Ivoire in terms of deforestation and abuses of human rights. It is high time for the industry to start paying growers a living wage and to implement sustainable production practices to ensure the resilience of local ecosystems, because without forests we will all suffer and pay sooner or later,” said Sindou Bamba, General Coordinator of the Coalition of Ivorian Human Rights Actors (RAIDH).

On average, cocoa growers in Ivory Coast and Ghana are paid less than 80 cents (USD) per day and often work in dangerous conditions with long hours. Child labor is still prevalent throughout the industry, despite pledges by many chocolate companies to eliminate the practice.

The report comes at a time of unique opportunity for the chocolate industry to take real action for a more environmentally responsible future. Earlier this year, Prince Charles convened CEOs and senior leadership of 34 chocolate industry companies to begin to urge them to act on deforestation. The companies pledged to come up with a concrete plan by November’s climate summit in Bonn.

“This report shows that the chocolate industry’s long history of heralding their own commitment to sustainability hasn’t stopped them from engaging in egregious behavior,” said Higonnet. “Prince Charles has managed however to get the industry to finally start talking about doing something real, creating a unique moment in which change is possible.”

About Mighty Earth

Mighty Earth is a global environmental campaign organization that works to protect forests, conserve oceans, and address climate change. We work in Southeast Asia, Latin America, Africa, and North America to drive large-scale action towards environmentally responsible agriculture that protects native ecosystems, wildlife, and water, and respects local community rights. Mighty Earth’s global team has played a decisive role in persuading the world’s largest food and agriculture companies to dramatically improve their environmental and social policies and practices. More information on Mighty Earth can be found at https://www.mightyearth.org/.

Read the full report here.

Output: The governments of Ghana and the Ivory Coast are drawing up proposals to prevent deforestation, following an investigation by The Guardian into the environmental impact of the cocoa industry on these countries. The newspaper disclosed in September that cocoa linked to deforestation had entered the supply chains of Barry Callebaut and Cargill, which sell to Cadbury, Mars and Nestle, while environmental group Mighty Earth found illegally grown cocoa was also being used by Godiva and Hershey’s. It remains unclear whether either government has the power to make traders pay for their reforestation plans.


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Asos launches chatbot on its Facebook page
 Fashion retailer Asos is testing new digital features, including a gifting assistant and a “pay later” feature.

The fashion company is launching a chatbot, created by Byte London, on its Facebook page on Nov. 8 for shoppers in the U.K. and France. Shoppers answer a series of questions, which the chatbot then uses to suggest potential gifts that are available on the site. Questions such as, “What item would most likely fall out of their bag?” will target the retailer’s younger shoppers.

The service will run throughout Christmas, yet it could form the basis of something bigger on the social network, given Asos’ ongoing experiments with artificial intelligence. Earlier this year, it began testing a virtual assistant, which helps customers search for products and keeps profiles on their personal data, including size and preferences.

Meanwhile, Asos is the latest retailer to jump on the try-before-you-buy trend.

Similar to Amazon Prime Wardrobe, shoppers who buy from the Asos app only pay for items they keep by selecting the “Pay Later” option to get 30 days to use either their credit or debit card to pay for the items they want.

But unlike Prime Wardrobe, which discourages people from making returns by offering discounts to those who keep a certain number of items, Asos’ focus is on shoppers who bail on buying clothes they may have to return.

The retailer said the service will appeal to customers who want to try on everything they’ve ordered and only pay for what they keep. Not being able to try on items before buying them has long been a challenge, so it made sense to explore a try-before-you-buy service in the U.K., said Nicola Thompson, Asos’ global trading director.

The retailer didn’t have the internal expertise to build its own flexible payment process like PayPal, for example, and doesn’t have ownership of its logistics process like Amazon. Instead, Asos worked with payments provider Klarna to offer the Pay Later feature following a successful run in Germany, where the financial firm let shoppers pay for their products up to 14 days after delivery. The retailer doesn’t break out specific metrics for the Klarna service, which it has used since 2013.

“The positive experience of flexible payment options in other territories, our belief in the Klarna service and a clear desire from customers made us confident that now would be a good time to launch,” Thompson said.

If customers know they don’t have to pay for products immediately, they could spend more time searching the app for clothes they might not have otherwise considered. As strong as dwell time is on the Asos app — users spend 80 minutes per month on average on it — the business has admitted that only a fraction of its catalog gets explored due to limitations in screen size, search and navigation.

No incentives are planned to drive adoption of Asos’ try-at-home feature, according to a company spokesperson. The retailer likes to bide its time before throwing marketing weight behind innovations, similar to its approach with its recently launched visual search feature.

Pay-later options are set to become a key battleground in online fashion sales, with Topshop, Miss Selfridge and Amazon already offering similar services. In Amazon’s case, it began testing its feature in the U.S. this summer, allowing Prime subscribers to order brands such as Hugo Boss, Adidas and Levi’s with no upfront charge. Customers have seven days to decide what they don’t want.

As Amazon expands the service to other markets, experts have noted that retailers like Asos, as big as they are, could feel the same pressure that has hit book publishers, broadcasters, supermarkets, consumer goods and others over the years. Analysts from investment banking firm Cowen & Co. expect Amazon’s clothing and accessory sales in the U.S. to grow by nearly 30 percent next year to $28 billion, making it the country’s biggest apparel seller.

Output: As it faces growing competition from Amazon, Asos has launched a chatbot on its Facebook page, intended to provide a more personalised experience. The bot will assist shoppers in the UK and France with Christmas gift ideas on their site. The feature joins a slew of other recent innovations by the company, including customer profiling and a "Pay Later" service available through its app. The service encourages a try-before-you-buy mentality, allowing customers pay for items 30 days after the point of order; Amazon Prime Wardrobe offers a similar grace period.


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Young Kenyan farmers group double harvests using hydroponics
 Some of the Esteem Eagles Welfare Youth Group members at the greenhouse in Meru South. [Peter Muthomi, Standard]

Tired of looking for elusive white-collar jobs, a group of young farmers decided to think out of the box. The 15-member group named ‘Esteem Eagles Welfare Youth Group’ started farming together. Initially it was a merry-go round, before they decided to pool resources and venture into greenhouse farming.

“We started out as a fun group doing picnics together. Since most of us did not have stable jobs, we decided to pool resources and focus on hydroponic farming because the bad soils could not allow us to do conventional farming,” says Stephen Kamau, a member. Hydroponics is a modern system of farming where plants are grown in liquid, sand, gravel with added nutrients but without use of soil. After deliberations the group approached the National Government’s Youth Fund in February 2014 for assistance.

“We wrote a proposal and were given Sh358,000 for a greenhouse,” says Kamau. In 2015, the members planted tomatoes and the result were disastrous.

“The soils were contaminated. We had to uproot the crop and re-planted in pots. Most of the crops failed because of bacterial wilt,” Dennis Mutwiri, a member recalls. The members resorted to fetching new soils from Kiraro, part of Mount Kenya forest, 20 kilometres away, an energy sapping activity.

“Though we re-planted the crops in the new soils we were only able to redeem a small fraction,” Kamau says.

Since the soils in their area were toxic, an idea to explore hydroponics came up. They wrote a proposal for funding from the Upper Tana Natural Resource Management Project, a national government agency. The agency gave them a Sh419,000 hydroponic system. The members attended training at Chuka University last year, and in June they installed the system.

“Now we get double the harvests we used to get when we planted on soil,” Mutwiri says. County agriculture officer Samuel Mutuma says because no manure is used in hydroponics chances crops thrive because they are free of diseases.The idea has flourished the members are now economically stable.

“We are doing well. Unlike others who depend on rainfall and soils, we are able to harvest several times a year. We always have a ready market. When the other farmers exit the market we are always in the market!” he says.

Output: A group of young Kenyan farmers have turned to hydroponics to grow crops after discovering their local soil was contaminated. The 15-strong Esteem Eagles Welfare Youth Group received a KES419,000 ($4,050) grant from national government agency the Upper Tana Natural Resource Management Project and installed the system in June 2017. Because no fertilisers are used the crops are free of diseases and because they are not dependent on rainfall, they can be harvested three times a year. Group member Dennis Mutwiri said: “Now we get double the harvests we used to get when we planted on soil.”


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Seven global megatrends could avert climate disaster
 ‘Everybody gets paralysed by bad news because they feel helpless,” says Christiana Figueres, the former UN climate chief who delivered the landmark Paris climate change agreement. “It is so in our personal lives, in our national lives and in our planetary life.”

But it is becoming increasingly clear that it does not need to be all bad news: a series of fast-moving global megatrends, spurred by trillion-dollar investments, indicates that humanity might be able to avert the worst impacts of global warming. From trends already at full steam, including renewable energy, to those just now hitting the big time, such as mass-market electric cars, to those just emerging, such as plant-based alternatives to meat, these trends show that greenhouse gas emissions can be halted.

“If we were seeing linear progress, I would say good, but we’re not going to make it in time,” says Figueres, now the convener of the Mission 2020 initiative, which warns that the world has only three years to get carbon emissions on a downward curve and on the way to beating global warming. “But the fact is we are seeing progress that is growing exponentially, and that is what gives me the most reason for hope.”

No one is saying the battle to avert catastrophic climate change – floods, droughts, famine, mass migrations – has been won. But these megatrends show the battle has not yet been lost, and that the tide is turning in the right direction. “The important thing is to reach a healthy balance where we recognise that we are seriously challenged, because we really have only three years left to reach the tipping point,” says Figueres. “But at the same time, the fact is we are already seeing many, many positive trends.”

Michael Liebreich, the founder of Bloomberg New Energy Finance, agrees. “The good news is we are way better than we thought we could be. We are not going to get through this without damage. But we can avoid the worst. I am optimistic, but there is a long way to go.”

Also cautiously hopeful is climate economist Nicholas Stern at the London School of Economics. “These trends are the start of something that might be enough – the two key words are ‘start’ and ‘might’.” He says the global climate negotiations, continuing this week in Germany and aiming to implement the Paris deal, are crucial: “The acceleration embodied in the Paris agreement is going to be critical.”

THE TRENDS

1. Methane: getting to the meat

A lab-grown burger. Photograph: David Parry/PA

Carbon dioxide from burning fossil fuels is the main greenhouse gas, but methane and nitrous oxide are more potent and, unlike CO 2 , still rising. The major source is livestock farming, in particular belching cattle and their manure.

The world’s appetite for meat and dairy foods is rising as people’s incomes rise, but the simple arithmetic is that unless this is radically curbed, there is no way to beat global warming. The task looks daunting – people hate being told what to eat. However, just in the last year, a potential solution has burst on to the market: plant-based meat, which has a tiny environmental footprint.

What sounds like an oxymoron – food that looks and tastes just as good as meat or dairy products but is made from plants – has attracted heavy investment. The buzz is particularly loud in the US, where Bill Gates has backed two plant-based burger companies and Eric Schmidt, formerly CEO of Google, believes plant-based foods can make a “meaningful dent” in tackling climate change.

Perhaps even more telling is that major meat and dairy companies are now piling in with investments and acquisitions, such as the US’s biggest meat processor, Tyson, and multinational giants Danone and Nestlé. The Chinese government has just put $300m (£228m) into Israeli companies producing lab-grown meat, which could also cut emissions.

New plant-based products, from chicken to fish to cheese, are coming out every month. “We are in the nascent stage,” says Alison Rabschnuk at the US nonprofit group the Good Food Institute. “But there’s a lot of money moving into this area.”

Plant-based meat and dairy produce is not only environmentally friendly, but also healthier and avoids animal welfare concerns, but these benefits will not make them mass-market, she says: “We don’t believe that is what is going to make people eat plant-based food. We believe the products themselves need to be competitive on taste, price and convenience – the three attributes people use when choosing what to eat.”

Plant-based milks – soya, almond, oat and more – have led the way and are now about 10% of the market and a billion-dollar business in the US. But in the past year, sales of other meat and dairy substitutes have climbed 8%, with some specific lines, such as yoghurt, shooting up 55%. “I think the writing’s on the wall,” says Rabschnuk. Billionaire entrepreneur Richard Branson agrees. “I believe that in 30 years or so we will no longer need to kill any animals and that all meat will either be [lab] or plant-based, taste the same and also be much healthier for everyone.”

2. Renewable energy: time to shine

Solar panel installation. Photograph: Kristian Buus/Corbis via Getty Images

The most advanced of the megatrends is the renewable energy revolution. Production costs for solar panels and wind turbines have plunged, by 90% in the past decade for solar, for example, and are continuing to fall. As a result, in many parts of the world they are already the cheapest electricity available and installation is soaring: two-thirds of all new power in 2016 was renewable.

This extraordinary growth has confounded expectations: the respected International Energy Agency’s annual projections have anticipated linear growth for solar power every year for the past decade. In reality, growth has been exponential. China is leading the surge but the impact is being felt around the world: in Germany last week there was so much wind power that customers got free electricity.

In the US, enthusiasm for green energy has not been dented by President Donald Trump committing to repeal key climate legislation: $30bn has been invested since he signed an executive order in March. “I am no longer concerned about electric power,” says Figueres.

3. King coal: dead or dying

The flipside of the renewables boom is the death spiral of coal, the filthiest of fossil fuels. Production now appears to have peaked in 2013. The speed of its demise has stunned analysts. In 2013, the IEA expected coal-burning to grow by 40% by 2040 – today it anticipates just 1%.

The cause is simple: solar and wind are cheaper. But the consequences are enormous: in pollution-choked China, there are now no provinces where new coal is needed, so the country has just mothballed plans for 151 plants. Bankruptcies have torn through the US coal industry and in the UK, where coal-burning began the industrial revolution, it has fallen from 40% of power supply to 2% in the past five years.

“Last year, I said if Asia builds what it says it is going to build, we can kiss goodbye to 2C” – the internationally agreed limit for dangerous climate change – says Liebreich. “Now we are showing coal [plans] coming down.” But he warns there is more to do.

Solar and wind are cheaper than new coal, he says, but a second tipping point is needed. That will occur when renewables are cheaper to build than running existing coal plants, meaning that the latter shut down. If renewable costs continue to fall as expected, this would happen between 2030 and 2040. At that point, says Liebrich, “Why keep digging coal out of the ground when you could just put up solar?”

4. Electric cars: in the fast lane

Vehicles being charged at China’s leading maker of electric cars, BYD Co, in Shenzhen, China. Photograph: Qilai Shen/Bloomberg/Getty Images

Slashing oil use – a third of all global energy – is a huge challenge but a surging market for battery-powered cars is starting to bite, driven in significant part by fast-growing concerns about urban air pollution.

China, again, is leading the way. It is selling as many electric cars every month as Europe and the US combined, with many from home-grown companies such as BYD. US-based Tesla is rolling out its more affordable Model 3 and in recent months virtually all major carmakers have committed to an electric future, with Volvo and Jaguar Land Rover announcing that they will end production of pure fossil-fuelled cars within three years.

“We have a domino effect now,” says Figueres. These cars are “now being made for the mass market and that is really what is going to make the transformation”.

“I don’t think it is going to slow down,” says Viktor Irle, an analyst at EV-volumes.com. Drivers can see the direction of travel, he says, with a stream of choked cities and countries from Paris to India announcing future bans on fossil-fuelled cars.

It is true that global sales of electric cars have now achieved liftoff, quadrupling in the past three years, but they still make up only 1.25% of all new car sales. However, if current growth rates continue, as Irle expects, 80% of new cars will be electric by 2030.

The rapid rise of electric cars has left the oil giants, who have a lot to lose, playing catchup. The oil cartel Opec has increased its estimate of the number of electric cars operative in 2040 by five times in the past year alone, with the IEA, ExxonMobil and BP all bumping up their forecasts too. Heavy transport remains a challenge, but even here ships are experimenting with wind power and batteries. Short-haul electric airplanes are on the drawing board, too.

5. Batteries: lots in store

A lithium-ion battery. Photograph: Alamy

Batteries are key to electric cars and, by storing energy for when the sun goes down or the wind stops blowing, they are also vital when it comes to enabling renewable energy to reach its full potential. Here too, a megatrend is crushing prices for lithium-ion batteries, which are down 75% over the past six years. The International Renewable Energy Agency expects further falls of 50-66% by 2030 and a massive increase in battery storage, linked to increasingly smart and efficient digital power grids. In the UK alone, government advisers say a smart grid could save bill-payers £8bn a year by 2030, as well as slashing carbon emissions.

Fears that lithium-ion, the technology that dominates today, cannot be scaled up sufficiently are overblown, argues Liebreich, as the metal is not rare. “I think lithium-ion is a banker in that you can be sure it will get cheaper and you can be sure there is enough.” He is also frustrated by frequent claims that a grid based on renewables and storage cannot be cheap and reliable: “That stupidity and absolute certainty is in inverse proportion to any knowledge of how you run an electrical system.”

It is true, however, that batteries will not be the solution for energy storage over weeks or months. For that, long-distance electricity interconnectors are being built and the storage of the energy as gas is also being explored.

6. Efficiency: negawatts over megawatts

A zero-carbon house. Photograph: Alamy

Just as important as the greening of energy is reducing demand by boosting energy efficiency. It’s a no-brainer in climate policy, but it can be very tricky to make happen, as it requires action from millions of people.

Nonetheless, good progress is being made in places such as the EU, where efficiency in homes, transport and industry has improved by about 20% since 2000. Improving the efficiency of gadgets and appliances through better standards is surprisingly important: a new UN Environment Programme report shows it makes the biggest impact of any single action bar rolling out wind and solar power.

But again, continued progress is vital. “We need to drive energy efficiency very, very hard, even for European countries,” says Prof Kevin Anderson at the University of Manchester. “We could power down European energy use by about 40% in something like 10-15 years, just by making the most efficient appliances available the new minimum.”

In countries with cool winters, better insulation is also needed, particularly as a fossil fuel – natural gas – currently provides a lot of heating. “What is a crime is every time a building is renovated but not renovated to really high standards,” says Liebreich, who thinks labelling such homes as “zero-energy-bill” homes, not “zero-carbon” homes, would help overcome opposition.

One sector that is lagging on energy efficiency is industry, but technology to capture and bury CO2 from plants is being tested and ways to clean up cement-making are also being explored.

7. Forests: seeing the wood

The destruction of forests around the world for ranching and farming, as well as for timber, causes about 10% of greenhouse gas emissions. This is the biggest megatrend not yet pointing in the right direction: annual tree losses have roughly doubled since 2000.

This is particularly worrying as stopping deforestation and planting new trees is, in theory at least, among the cheapest and fastest ways of cutting carbon emissions. But it is not getting the support it needs, says Michael Wolosin at Forest Climate Analytics. “Climate policy is massively underfunding forests – they receive only about 2% of global climate finance.” Furthermore, the $2.3bn committed to forests by rich nations and multilateral institutions since 2010 is tiny compared with the funding for the sectors that drive deforestation. “Brazil and Indonesia’s governments alone invested $276bn in the same timeframe, in just the four key driver commodities: palm oil, soy, beef and timber,” says Franziska Haupt at Climate Focus.

In fact, new research has shown that better land management could deliver a third of all the carbon cuts the world needs, and Wolosin says there are some grounds for hope that new forests can be planted. “Achieving large-scale forestation is not just theoretical. We know we can do it because a few countries have done it successfully.”

In the past two decades, tree-planting in China, India and South Korea has removed more than 12bn tonnes of CO2 from the atmosphere – three times the entire European Union’s annual emissions, Wolosin says. This action was driven by fears about flooding and food supply, meaning that global warming needs to be seen as equally urgent in this sector. Regrowing forests can also play a crucial role in sucking CO2 out of the atmosphere, which is likely to be necessary after 2050, unless very sharp cuts are made now.

The race against time

Will these megatrends move fast enough to avoid the worst of climate change? Opinions vary and Anderson is among the most hawkish. He says it remains possible for now, but is pessimistic that the action will be taken. “We’re pointing in the right direction but not moving [there]. We have to not just pursue renewables and electric vehicles and so forth, we have to actively close down the incumbent fossil fuel industry.”

Stern is cautiously optimistic, saying that what has changed in recent years is the realisation that green economic growth is the only long-term option: “There is no long-run high-carbon growth story because it creates an environment so hostile that it turns development backwards.

“There are some tremendous developments so I am very confident now we can do this, but the change, attractive as it is, has to be radical,” he says. “Will we have the political and economic understanding and commitment to get there? I hope so.”

Output: Seven global mega-trends might enable humanity to avert the worst consequences of global warming, according to an op-ed in The Guardian that cites formerUN climate chief Christiana Figueres, founder of Bloomberg New Energy Finance Michael Liebreich and climate economist Nicholas Stern. The trends include: low environmental footprint plant-based meat, increasing use of renewable energy, the death of coal, greater use of electric cars, increased battery storage and greater energy efficiency. Deforestation is the largest mega-trend not yet moving in the right direction, but better land management and forest planting could reduce the amount of CO2 in the atmosphere.


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Chinese edtech Yixue offers AI-powered personalised learning
 Yixue Education, a Chinese K12 online education company, has raised RMB270 million (US$41 million) in an angel round from SIG, Nokia Growth Partners, New Oriental Education and Technology Group Inc. and Greenwood Investment, local media reports.

Output: Chinese K12 online education company Yixue has raised CNY270m ($41m) in an angel round of investment. The edtech company uses AI to provide tailored educational programmes and has partnered with more than 100 schools in China. The company's founder, Li Haoyang, said: "With AI, we can adjust teaching strategies in real time to achieve personalised learning, more efficient than one-to-one teaching with teachers." The angel investors included SIG, Nokia Growth Partners and New Oriental Education, according to local media.


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Sunflower oil microcapsules create ‘self-healing’ roads
 When roads start to crack, the capsules break open and release the oil within, softening the asphalt around it. This helps the asphalt ‘stick’ back together, effectively filling in cracks and preventing small defects from deteriorating further. Dr Garcia who is heading up the research, has named his new ‘recipe’ Capheal – a pioneering, world-leading technology based on microcapsules of sunflower oil, which can be combined in asphalt mixes to improve the self-healing abilities of roads.

Dr Garcia watched one of the show’s contestants use the spherification technique, which is the controlled jellification of a liquid to form spheres that resemble caviar when submerged in a bath. This is when he lit upon the idea of placing capsules of oil in asphalt, a material used for surfacing roads.

Dr Alvaro Garcia, a lecturer with the Faculty of Engineering at the University of Nottingham, has hit on a recipe for success by drawing inspiration from the Spanish version of the popular MasterChef series and come up with an innovative method, which uses sunflower oil to repair roads.

Click here for full story

Dr Garcia said, ‘Our preliminary results showed that the capsules can resist the mixing and compaction processes without significantly reducing the physical and mechanical properties of asphalt and they also increased its durability. More importantly, we found that the cracked asphalt samples were restored to their full strength, two days after the sunflower oil was released.’

Sunflower oil can reverse the effects of ageing in bitumen used in asphalt by reducing the viscosity of the binder. The microcapsules created by Dr Garcia and his team, help to reduce the amount of other healing agents used because they can be activated in precise areas when required, thus avoiding the need to be mixed up in bulk.

Dr Garcia and his team are based at the Nottingham Transportation Engineering Centre (NTEC), the UK's foremost university-based research organisation in pavement engineering, infrastructure asset management and sustainability. He estimates that Capheal could increase a road’s lifespan by at least one-third from 12 to 16 years and costs about the same as other additives that are commonly used in asphalt paving. In a report in Auto Express, Alan Mackenzie, the former chairman of the Asphalt Industry Alliance (AIA) said, ‘Our local roads are an asset worth in excess of £400 billion but, at present, less than one percent of their value is being spent annually on maintenance.’ The AIA’s 2017 ALARM survey showed that a total of 1.7 million potholes were filled on local authority roads in England and Wales during 2016. Based on these figures, it is estimated that Capheal could potentially reduce the annual costs for major road repairs by £260 million per annum.

Speaking about the advantage Capheal offers over other self-healing technologies, Dr Garcia said, ‘I previously worked on developing self-healing roads in the Netherlands and Switzerland that featured metal fibres. An induction heater would pass over the surface to melt the bitumen and fill in cracks in the roads, but the problem with that is you need a large machine, which is expensive and requires a road to be closed to traffic.

‘We needed a different way to create self-healing roads - without the use of an external aid, so I decided to design capsules containing oil that can break by themselves when the mechanical loading on a carriageway caused it to crack.’

At present, the NTEC team is refining the geometry of the microcapsules to better understand how they degrade over time. They will go on to develop capsules with varying degrees of strength to see how they perform under different types of stresses to determine their suitability for a range of asphalt mixes and traffic conditions. The team is also looking into recycling cooking oil to reduce the viscosity of binders in asphalt.

This research project is being funded by Highways England, a government-owned company which operates, maintains and improves England's motorways and major A roads. Senior Pavements Advisor Robin Griffiths said, ‘We know road users want good quality road surfaces, with fewer potholes and not as many roadworks disrupting their journeys. This self-healing technology could give them that and offer real value for money.

‘So far the Nottingham University research we have funded is showing real potential in how easy it is to mix and apply, as well as being sustainable and environmentally friendly.

‘Now we have to test the material on small patches of road, to see how it copes with the stresses and strains of daily traffic and the British weather. The safety of the travelling public will be integral as we take this work forward with the University.’

NTEC’s team is near the end of the initial stage of the project with the successful completion of laboratory tests and pilot trials. After this, Highways England will test bed Capheal on carefully selected sections of a road during planned overnight maintenance work. This will be followed by a monitoring period of about 12 to 24 months to determine Capheal’s level of durability and endurance.

— Ends —

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Notes to editors:

The University of Nottingham is a research-intensive university with a proud heritage, consistently ranked among the world's top 100. Studying at the University of Nottingham is a life-changing experience and we pride ourselves on unlocking the potential of our 44,000 students - Nottingham was named University of the Year for Graduate Employment in the 2017 Times and Sunday Times Good University Guide, was awarded gold in the TEF 2017 and features in the top 20 of all three major UK rankings. We have a pioneering spirit, expressed in the vision of our founder Sir Jesse Boot, which has seen us lead the way in establishing campuses in China and Malaysia - part of a globally connected network of education, research and industrial engagement. We are ranked eighth for research power in the UK according to REF 2014. We have six beacons of research excellence helping to transform lives and change the world; we are also a major employer and industry partner - locally and globally.

Impact: The Nottingham Campaign, its biggest-ever fundraising campaign, is delivering the University’s vision to change lives, tackle global issues and shape the future. More news…

Output: A scientist at the University of Nottingham has developed a new "self-healing" material for road surfaces incorporating tiny capsules filled with sunflower oil. Dr Alvaro Garcia was inspired to investigate the use of microcapsules after seeing a culinary technique called spherification on the Spanish version of the "MasterChef" TV programme. When the new material cracks, the capsules release the oil, which softens the asphalt and sticks it back together. The research has been funded by England's highways agency, and Dr Garcia believes it could extend a road's lifespan by up to a third.


Instruction: create a high quality summary of the given input

Input:
Sunflower oil microcapsules create ‘self-healing’ roads
 An episode of MasterChef inspired a researcher from the University Nottingham to develop a new technology for repairing cracks in road surfaces.

After watching a contestant on the Spanish version of the show use a technique known as spherification (the controlled jellification of a liquid to form spheres), Dr Alvaro Garcia, from the Nottingham Transportation Engineering Centre (NTEC), began exploring how the addition of microcapsules of oil to asphalt could be used to create self-repairing road surfaces.

The idea is that as cracks appear in the road the capsules break open, releasing the oil within and softening the asphalt around it. This helps the asphalt ‘stick’ back together, effectively filling in cracks and preventing small defects from deteriorating further.

Working with funding from Highways England, Garcia’s team has created and carried laboratory tests on microcapsules filled with sunflower oil. Commenting on the research Garcia said, ‘Our preliminary results showed that the capsules can resist the mixing and compaction processes without significantly reducing the physical and mechanical properties of asphalt and they also increased its durability. More importantly, we found that the cracked asphalt samples were restored to their full strength, two days after the sunflower oil was released.’

Sunflower oil can reverse the effects of ageing in bitumen used in asphalt by reducing the viscosity of the binder. The microcapsules created by Dr Garcia and his team, help to reduce the amount of other healing agents used because they can be activated in precise areas when required, thus avoiding the need to be mixed up in bulk.

Garcia estimates that the material – which he has named Capheal - could increase a road’s lifespan by at least one-third from 12 to 16 years and costs about the same as other additives that are commonly used in asphalt paving.

He added that is has potential advantages over other road healing technologies, which often rely on additional equipment. "I previously worked on developing self-healing roads in the Netherlands and Switzerland that featured metal fibres,” said Garcia. “An induction heater would pass over the surface to melt the bitumen and fill in cracks in the roads, but the problem with that is you need a large machine, which is expensive and requires a road to be closed to traffic.”

NTEC’s team is near the end of the initial stage of the project with the successful completion of laboratory tests and pilot trials. After this, Highways England will test bed Capheal on carefully selected sections of a road during planned overnight maintenance work. This will be followed by a monitoring period of about 12 to 24 months to determine Capheal’s level of durability and endurance.

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Output: A scientist at the University of Nottingham has developed a new "self-healing" material for road surfaces incorporating tiny capsules filled with sunflower oil. Dr Alvaro Garcia was inspired to investigate the use of microcapsules after seeing a culinary technique called spherification on the Spanish version of the "MasterChef" TV programme. When the new material cracks, the capsules release the oil, which softens the asphalt and sticks it back together. The research has been funded by England's highways agency, and Dr Garcia believes it could extend a road's lifespan by up to a third.


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MIT teams wins architecture prize in Mars City Design competition
 Most plans for Mars bases make becoming a colonist about as desirable as setting up house in an oil drum, but an MIT team has come up with a plan for a Mars city based on the architecture of a tree. Taking out first place in the Architecture section of the Mars City Design 2017 competition, the Redwood Forest concept is intended to provide settlers with not only protection against the harsh Martian environment, but open public spaces filled with plants and abundant water.

As Sir Elton John said, Mars ain't the kind of place to raise your kids. Though the Red Planet is the most habitable of the planets, aside from our own, in the Solar System, it is still a terribly hostile place. The nighttime temperatures put the Antarctic to shame, the air is only a hundredth the pressure of Earth's and is composed mostly of carbon dioxide, deadly UV radiation rains down during the day, and cosmic rays are present 24/7. It's also dry to the point where the soil is composed of corrosive substances with very unpleasant properties.

Due to these drawbacks, it's difficult to come up with designs for manned outposts that don't look like a collection of tins that make the Amundsen-Scott South Pole Station look like a luxury resort. To break away from this stereotype, the MIT team of nine students led by MIT postdoc Valentina Sumini and Assistant Professor Caitlin Mueller took an interdisciplinary approach that uses location and system architecture, as well as water harvested from the Martian polar ice caps to supply tree-like habitats, for a design capable of housing 10,000 inhabitants in shirt-sleeve comfort.

The habitats include an intricate network of subsurface tunnels MIT

At first glance, the MIT habitats don't look very tree-like. They look more like giant glass balls sitting on the Martian plains, each housing 50 people. But, like real trees, much of the habitat is below the surface in the form of intricate tunnels that connect the spheres and provide protection from cold, radiation, micrometeorites, and other surface hazards.

"On Mars, our city will physically and functionally mimic a forest, using local Martian resources such as ice and water, regolith or soil, and sun to support life," says Sumini. "Designing a forest also symbolizes the potential for outward growth as nature spreads across the Martian landscape. Each tree habitat incorporates a branching structural system and an inflated membrane enclosure, anchored by tunneling roots. The design of a habitat can be generated using a computational form-finding and structural optimization workflow developed by the team. The design workflow is parametric, which means that each habitat is unique and contributes to a diverse forest of urban spaces."

The habitats rely heavily on water, but not just for drinking, agriculture, or public fountains. It's a key ingredient in making the domes habitable.

Left to right: Team members George Lordos, Alpha Arsano, Caitlin Mueller, and Valentina Sumini MIT

"Every tree habitat in Redwood Forest will collect energy from the sun and use it to process and transport the water throughout the tree, and every tree is designed as a water-rich environment," says Department of Aeronautics and Astronautics doctoral student George Lordos. "Water fills the soft cells inside the dome providing protection from radiation, helps manage heat loads, and supplies hydroponic farms for growing fish and greens. Solar panels produce energy to split the stored water for the production of rocket fuel, oxygen, and for charging hydrogen fuel cells, which are necessary to power long-range vehicles as well as provide backup energy storage in case of dust storms."

The team believes that the Mars tree habitats could find a niche on Earth as well, at high latitudes, deserts and the sea floor, for example. In addition, the hydroponics technology could provide city dwellers with fresh food and the tunnels could be used to ease congestion in urban areas.

The team took out first place in the Architecture section of the 2017 Mars City Design competition

Source: MIT

Output: An MIT team's concept for a populated city on Mars called Redwood Forest has claimed first prize in the architecture section of the Mars City Design 2017 competition. Using an interdisciplinary approach that uses water taken from the Martian polar ice caps to supply tree-like habitats, MIT's design consists of large surface domes that contain the trees, with tunnels connecting the domes. Living quarters would be situated underground directly beneath each dome and an entire city could hold up to 10,000 residents, with each individual dome housing 50 residents.


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New record-low solar price set in Chile auction
 The latest energy auction in Chile has set a new record low for solar PV, with one bid by the local subsidiary of Italian outfit, Enel, coming in at just $US21.48/MWh ($A28/MWh).

The result beats the previous record low of $US24.20 set in the United Arab Emirates earlier this year, although it could be beaten by Saudi Arabia’s first auction, should the early results of a tender that secured an offer of $US17.90/MWh be verified later this month.

Either way, the Chile government is happy with the result, which secured an average price of $US32.5/MWh for 600MW of solar and wind capacity, expected to produce around 2,200GWh. This is a 75 per cent fall since its auction program began in 2015.

The Chile government says it will mean consumer prices fall by nearly 50 per cent once all the new projects are completed and online in 2024.

“This price of energy is a milestone in the sector,” energy minister Andrés Rebelled said in a statement accompanying the results. (See here in Spanish).

In 2014 “the goal proposed by President Bachelet was to lower energy prices by 25 per cent, today we can say with great calm, transparency and joy, that we have managed to lower the price of energy by 75 per cent in the last three years.”

Andrés Romero, the executive secretary of the National Energy Commission, said households currently pay around $US90/MWh. “Now, with this tender, we expect that these new contracts will gradually go down at prices in around $US50, which will go directly benefit of households. ”

Reuters reported that the lowest bid came from Enel, a part owner of one of the biggest solar farms under construction in Australia, the 220MW Bungala solar project in South Australia.

The second-lowest bid came from GPG Solar Chile, a unit of Spanish power and gas utility Gas Natural Fenosa, which offered $US24.80/MWh for the same block.

Output: Chile's latest energy auction has set a new record low price for solar PV, with a bid from Italian company Enel's local subsidiary coming in at just $21.48/MWh. Overall, the government of Chile secured an average price of $32.5/MWh, which is a 75% fall from the beginning of its auction programme in 2015. Consumer prices will fall by nearly 50% as a result, according to the country's energy minister. The previous lowest solar price was set in the UAE earlier this year, and this latest record may be broken in Saudi Arabia this month.


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Interaxon goes after meditation market with Muse EEG headband
 Toronto-based Interaxon, creator of the Muse EEG-sensing headband, has raised $11.6 million ($14.8 million CAD) in a round led by Trend Forward Capital, Export Development Canada, and OMERS Ventures. Epic Capital Management and Bridge Builders Collaborative also contributed to the round.

Interaxon raised $287,000 for Muse in late 2012 and officially launched the product in 2014, one of a handful of consumer-focused EEG wearables entering the market around that time. Since then, in addition to its direct-to-consumer marketing, the company has made several enterprise plays. For instance, the company has an offering for mental health professionals that allows them to quantify and track clients' meditation habits.

“Meditation has become a billion-dollar business, and Muse is unique in that it provides a hardware device with insight into brain activity to help consumers build a meditation practice,” Derek Luke, Interaxon CEO, said in a statement. “The ability to benchmark and measure progress has been particularly attractive not only to consumers but also leaders of corporate wellness programs, mental health professionals, and business and athletic coaches. With this investment, Interaxon is uniquely positioned to harness the potential of its brain interface into the consumer, professional, and wellness markets, creating a vibrant services-based platform positioned for growth.”

Interaxon plans to use the new funding to build out that clinical market, as well as a software as a service offering for corporate wellness. The company is also making Muse available to developers. Among other things, according to a release from the company, virtual reality researchers are looking at using the headband as a control mechanism for virtual reality experiences.

Interaxon also announced last year that it is partnering with Safilo, an Italian eyeglasses brand, to create glasses with built-in sensors, starting with sunglasses for athletes that include EEG, a 3-axis accelerometer, a 3-axis gyroscope, a 3-axis magnetometer, a UV sensor, a temperature gauge, and a pressure sensor.

"We’ve been providing superior vision and safety through our market-leading goggles and helmets for more than 50 years and are excited to add cognitive training and conditioning to our offering," Thorsten Brandt, general manager of Safilo’s sports and outdoor lifestyle brands, said in a statement at the time. "Active consumers at all levels intuitively understand the importance of finding their focus, yet up until now, there haven’t been a lot of products that help you up your mental game. We believe our collaboration with Interaxon is truly unique and something our customers will love. This is a first in bringing together innovative products that beautifully blend technology, form, and style.”

Finally, Muse has also become something of a favorite of researchers, used in brain research at more than a hundred hospitals and universities for studies of pain, PTSD, fatigue, and more — as well as mindfulness and meditation.

Output: Canadian company Interaxon is seeking to increase take-up of its EEG-sensing headband Muse by health professionals who provide meditation services. The firm, which recently raised $11.6m (CAD14.8m) in a funding round, will use the investment to expand into corporate wellness programmes and offer its technology to business and athletics coaches, as well as to mental health professionals. Interaxon's CEO, Derek Luke, said the firm was "uniquely positioned to harness the potential of its brain interface into the consumer, professional and wellness markets". Interaxon also said Muse is being considered as a control device by virtual reality developers.


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Redrow First phase of 950-home development to be built by Redrow
 The first phase of a new 950 home community in Leighton Buzzard is to be created by Redrow.

The award-winning housebuilder has exchanged contracts with Arnold White Estates to acquire part of the former Chamberlains Barn Quarry, in Heath Road, and is drawing up plans to build almost 300 homes.

The wider 95 hectare site has outline planning permission for up to 950 new homes plus a school, local centre, a country park, play areas and will form part of the Eastern Leighton Linslade Urban Extension Scheme.

Edward Irving, land director for Redrow Homes (South Midlands), said:

“We’re very excited to be involved in such a high profile project to bring the redundant quarry site back into good use to provide much needed new homes. Ensuring that new neighbourhoods have the facilities and infrastructure people want and need is key and the wider scheme will have amenities that will benefit the whole community, including an abundance of open space and a school. Both of these factors ranked highly in a Redrow research report earlier this year, ‘Creating Britain’s new communities’. “We’re currently finalising our plans and will soon be submitting a reserved matters planning application for 299 homes from our Arts & Crafts inspired Heritage Collection which combines traditional exteriors with bright, modern interiors.”

Redrow’s plans include 30 affordable homes, as well as 269 private sale properties which would offer a mixture of two, three and four-bedroom homes.

The Heath Road scheme would have a gross development value of around £110 million.

Subject to planning, Redrow hopes to start construction work on site in summer 2018.

Redrow is currently building and selling homes from its Heritage Collection nearby at Caddington Woods, between Chaul End and Caddington, in Central Bedfordshire and at Weston Grove, Weston Turville, Buckinghamshire.

Output: UK house builder Redrow is drawing up plans to construct about 300 properties as part of a £110m ($144m), 950-home development in Leighton Buzzard, Bedfordshire. Edward Irving, the land director for Redrow Homes South Midlands, said the company would be submitting a reserved matters planning application for 299 homes, 30 of which would be affordable housing. Work is expected to start on the development next summer.


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Smart-beta ETF market enters slowdown as passive dominance grows
 The "smart beta" fund industry, a kind of hybrid between active and passive fund management, boomed in 2015 and 2016, with close to 200 funds launched in 24 months.

But the business has gotten increasingly competitive, and its year-over-year growth is slowing.

As smart beta decelerates, many in the investing industry will face the ongoing question about how to remain competitive, and the answer is probably to cut fees.

As the battle between active money managers and their computer-driven passive counterparts has raged for years, one investment strategy has served as a compromise of sorts.

Known as "smart beta," it takes the passive approach of mirroring an index and combines it with the more analytical practice of stock picking. And that fundamental overlay usually adheres to a predetermined investment style, such as low-volatility or high-growth.

The ability to straddle that line has translated into an area of serious growth for exchange-traded fund providers looking to capture the massive flow of capital into passive strategies while also proving their bona fides as active managers.

But unfortunately for those providers looking to break into smart beta, the window to get involved appears to be closing. Only 36 new smart-beta funds have been launched this year, on pace for the lowest annual number since 2014, according to data compiled by Goldman Sachs.

The growth of smart-beta exchange-traded fund launches is on pace to slow this year. Goldman Sachs / Morningstar

'Smart beta ETFs are facing increasing pressure'

"The economics in smart beta ETFs are facing increasing pressure," a group of analysts led by Alexander Blostein wrote in a client note. "Market share is ultimately consolidating among top players, fees are migrating lower and the limited success of several recent launches could discourage others from entering the space."

Goldman offers three clear-cut reasons that fund managers may be discouraged from entering the smart-beta space:

New entrants into the space — The smart-beta heyday of 2015 and 2016, when roughly 100 new funds were launched each year, saw loads of new providers get into smart beta. That creates a considerable barrier to entry for an already-inundated area.

— The smart-beta heyday of 2015 and 2016, when roughly 100 new funds were launched each year, saw loads of new providers get into smart beta. That creates a considerable barrier to entry for an already-inundated area. The biggest providers are continuing to grow — BlackRock, Vanguard, Invesco, WisdomTree, and State Street are the big dogs of the ETF world. The massive amount of capital they've accrued gives them a big advantage in both bringing new funds to market and consolidating with other firms.

— BlackRock, Vanguard, Invesco, WisdomTree, and State Street are the big dogs of the ETF world. The massive amount of capital they've accrued gives them a big advantage in both bringing new funds to market and consolidating with other firms. Fee rates are trending lower — Goldman finds that "fee pressures are accelerating significantly," which will make it more difficult for new entrants to break into the ETF marketplace.

With forays into the universe of smart beta looking decreasingly appealing, managers using an active stock-picking component must find a way to adapt. After all, just because smart beta is slowing doesn't mean passive investment is.

The huge shift to passive management from active

According to the EPFR, passive equity funds have seen global inflows of $620 billion in the past 12 months, while active funds have seen outflows of $359 billion. In terms of sheer size, the combined assets of US ETFs hit $3.1 trillion in August, increasing roughly $700 billion in a single year, according to Investment Company Institute data.

A huge part of this divergence stems from a factor mentioned in the third bullet above: Passive funds are cheaper. With the opportunity in smart beta shrinking, perhaps it's time for active managers to stop trying to combine their efforts with passive funds and start making their pricing more competitive.

One possible route would be for active managers to pursue vehicles known as variable pricing mutual funds. Pioneered by AllianceBernstein earlier this year, the methodology is simple: the bigger the outperformance, the bigger the fee. Citigroup sees the strategy delivering investors better net returns on average and says it could "radically alter" money management as we know it.

It's a nuanced approach that certainly gives providers more flexibility than simply making huge fee cuts — a practice Goldman sees as ultimately futile, given the wide pricing discrepancy that already exists. The firm instead recommends the "surgical" lowering of select fees.

Beyond these suggestions, it's clear that the investing industry will continue to carve out new paths toward profitability as others dry up. And it's a wise move because, for the time being, it appears as if the smart-beta ship has sailed.

Output: The number of smart-beta exchange-traded funds being launched is declining as investors continue to pour money into low-cost passive strategies. The number of smart-beta offerings set to be launched in 2017 is likely to be the lowest since 2014, according to data compiled by Goldman Sachs. In 2015 and 2016 these offerings took off with 107 and 91 ETFs launched, respectively. Pressure on fees is also being billed as a reason for the slowdown.


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BlackRock could win big by combining analytics and robo platforms
 Since its acquisition in 2015, crickets for the $152-million robo-advisor, but under young legend Rob Goldstein, that could all change as BlackRock rolls out its play to own the advisor desktop

Author Brooke Southall November 7, 2017 at 8:39 PM

Output: BlackRock, which is in the process of a major digital initiative starting with the establishment of its digital wealth unit, could be on to a winner if it combines its robo-advice platform with its analytics capabilities. Combining FutureAdvisor, the firm's robo platform, and Aladdin, its data and risk analytics arm, could give the asset manager significant distribution clout, wrote Brooke Southall in RIABiz.


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Chinese fintechs may be regulated like banks: PBOC
 Fintech companies should fall under the same risk assessment framework as banks, a PBOC official said. Back in August, the PBOC for the first time said it wanted to include internet finance companies in its Macro Prudential Assessment framework, a risk monitoring and mitigation system designated for banks. It remains unknown whether or when that will happen, according to Caixin. “Systemically important financial institutions do not necessarily have to be traditional financial institutions,” Sun Guofeng, head of the PBOC’s finance research institute, said during a recent digital finance conference. Regulators have been “exercising tolerance” toward fintech firms to encourage innovation and improve the financial system’s competitiveness, Sun said. China’s financial system is dominated by banks, so increasing sources of competition can make the entire system more efficient, but at the same time many risks were exposed and left unattended. The actions of some large fintech firms could have an impact on the health of the entire financial system, he added.

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Output: The People's Bank of China (PBOC) is set to begin regulating fintech firms in the same way it regulates legacy banks. Bank officials have noted fintech firms have faced more lenient regulations in order to encourage innovation and add more diversity to the Chinese financial system. The PBOC now notes, however, that certain risks have flown under the radar and a new treatment of fintech firms may be in order.


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Energy storage could reach 35 GW by 2025: Navigant Research
 Dive Brief:

The Energy Storage Association on Monday released a paper that charts a path toward reaching 35 GW of new energy storage systems by 2025.

The “35x25: A Vision for Energy Storage” white paper, created in conjunction with Navigant Research, outlines the market drivers behind the rapid growth of energy storage and the value of a “disruption-proof grid.”

The paper argues that widespread use of energy storage could result in $4 billion in cumulative operational grid savings and the potential for more than 167,000 new jobs.

Dive Insight:

GTM Research and the Energy Storage Association already noted the first quarter of this year was the largest ever for energy storage.

There were 71 MW of storage projects deployed in the first quarter, a 276% increase over Q1 2016 and the second highest quarter since GTM and the ESA began tracking energy storage in 2013, surpassed only by installations in fourth quarter 2016. Despite that strong performance, storage is still a small part of the total U.S. market, with all storage installations composing only about 0.5 GW.

But market forces will drive much wider expansion of energy storage according to the ESA-Navigant paper. Among the market drivers are the electrification of the transportation sector, and the need for a variety of industries, such as communications and some manufacturing processes, for a more flexible and resilient grid. The paper argues that in an electrified economy, grid disruptions will become even more costly. Already, it is estimated that power outages, surges and spikes cost the U.S. economy more than $150 billion every year, the paper says.

Energy storage is key to building a disruption-proof grid by providing on-demand capacity and responsive balancing capability. The paper outlines a variety of benefits that wider adoption of energy storage could provide.For one, faster response times enabled by storage could result in $4 billion in cumulative operational cost savings by 2025, the authors say.

In addition, they say wider adoption of energy storage could enhance reliability and resilience, help reduce air pollution and create more than 167,000 jobs.

“Energy storage is the key to creating a powerful energy ecosystem whose backbone is an efficient, resilient, affordable, and sustainable grid,” Kelly Speakes-Backman, CEO of ESA, said in a statement.

Output: Energy storage could reach 35 GW by 2025, according to the Energy Storage Association and Navigant Research. The first quarter of 2017 saw the biggest-ever increase in storage projects, with 71 MW of new capacity deployed, a 276% increase on the same quarter last year. The report identifies market forces that it claims will drive further expansion, including the increased adoption of electric vehicles and the need for a more resilient energy grid. The authors claim increased storage could create more than 167,000 new jobs and save $4bn in operational costs.


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Insurers need to adopt more tech: Singapore deputy PM
 Insurance firms can - and must - do a lot more to take advantage of digital technology, Deputy Prime Minister Tharman Shanmugaratnam said yesterday.

Mr Tharman said at the launch of Prudential Singapore's new office at Marina One that health insurers can tap digital technology to go beyond paying for medical claims to preventive care and encouraging a healthy lifestyle and habits.

He noted that some insurers have already begun tracking users' health and habits through fitness devices and apps, and pricing in premium discounts for healthier lifestyles.

Healthcare itself can also be delivered and administered more effectively with digital technology, Mr Tharman noted, and insurers should encourage this.

"Tele-health is increasingly being used, saving patients time and money. Here in Singapore, we have been rolling out TeleRehab services for stroke patients.

"It delivers better health outcomes because doctors can monitor patients and make sure they follow through on rehabilitation without the inconvenience of regular physical travel to the clinic."

Apps and social media also present insurers with more touch points to engage their clients, Mr Tharman added, while telematics and Internet-of-Things devices enable data analytics, allowing insurers to deliver more customised and innovative products and services.

At the backend, he noted that the life insurance industry is testing artificial intelligence and blockchain to automatically trigger and settle claims.

With such changes, the role of the insurance agent will also evolve, Mr Tharman said. From selling life or health products, he must now offer more holistic wealth and risk management advice.

"Given the growing demand for risk management and compliance-related roles in the industry, I also encourage insurers to consider reskilling some of their agents to take on such roles," he said.

The new PRU Workplace aims to promote such change. The insurer has two floors totalling 80,000 sq ft at the new office, which houses 1,000 employees.

The office's open plan is designed to inspire innovation and build a creative work culture to support the company's future growth.

It includes social spaces, activity rooms - such as one in which employees can play with Lego bricks as they brainstorm ideas - nature-inspired nooks and rest pods for naps.

Employees also have the flexibility and autonomy to work from anywhere and at any time.

"Just as we are challenging our people to make a mental shift to a more creative and collaborative culture, our physical workspace and work policies must equally support our journey," said Prudential Singapore chief executive Wilf Blackburn.

Output: Singapore's deputy prime minister has said insurers need to be more willing to adopt and accept technological advances. Tharman Shanmugaratnam suggested there were many areas of insurance which could benefit from technology adoption, noting a number of health insurers already use apps and wearables to track data for policyholders. Among other changes insurers should be making is retraining staff to tackle risk management or compliance-related position given the growing importance of these in the industry, said Shanmugaratnam.


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Toyota to introduce Japan's first telematic car insurance
 Toyota Motor Corporation, along with MS&AD Insurance Group’s Aioi Nissay Dowa Insurance, has jointly developed Japan’s first driving behaviour-based telematics automobile insurance.

The new insurance by Toyota is available to owners of certain units of Toyota connected cars that will use driving data gathered via telematics technologies for adjusting the insurance premium based on the level of safe driving habits of the user every month. The insurance premium will consist of a combination of the basic insurance premiums and usage-based insurance and under this new plan up to 80 percent of usage-based insurance premiums can be discounted.

In addition to driving behaviour discounts, other services will be provided under the concepts of ‘enjoyment’, ‘benefits’, and ‘safeguards’. The new service will go on sale from January 15, 2018, while insurance liability is scheduled to commence in April 2018.

According to Toyota and Aioi Nissay Dowa Insurance the intention is to contribute towards the realisation of a safe and secure traffic environment through the development and provision of telematics automobile insurance that utilises connected cars and automobile big data.

Development background

Advancement in telematics technologies has led to major changes in the automobile landscape, such as the creation of a variety of new products and services that utilise automobile driving data. In Europe and the USA, there has been an increase in the number of automobile insurance policies that utilise telematics technologies to provide discounted insurance premiums based on levels of safe driving. In Japan, the government is advocating the use of automobile insurance that leverages telematics technologies as a means of reducing the number of accidents. Consequently, automakers and IT companies are engaged in lively competition for technological development.

Recently, Toyota declared the three pillars of its connected strategy: connecting all cars; the creation of new value and business revolution; and the creation of new mobility services. Through the development of connected cars, that are equipped with data communication modules (DCM), which are required for transmitting data, it provides connected services that utilise big data.

This has enabled the company to engage in the creation of new value for a mobility society and, at the same time, it aims to realise the ultimate goal of eliminating traffic fatalities and injuries. For this, the company promotes the development of advanced safety technologies such as Toyota Safety Sense and ICS, and has increased the number of models equipped with these technologies along with working together with dealers, commencing Support Toyota programs―educational traffic safety activities aimed at enhancing customer safety and peace of mind.

In the initial phase the company’s new insurance scheme will see Toyota’s connected cars (including Lexus vehicles) and the line-up will be gradually expanded starting with the Crown (scheduled for launch in April-May,2018) and all new models that will be sold from January 2018 onwards are eligible (excluding the HS and LC; certain existing models are also eligible).

How it works?

The connected cars will automatically transmit a variety of car-related data via a DCM to the Toyota Smart Center. Utilising this vehicle driving data, Aioi Nissay Dowa Insurance will provide a new service that will be unique to Toyota vehicles.

Apart from utilising data for determining the policy premium, the data will also generate a drive report that will help vehicle users for getting – tips that can be checked after every drive, safe driving score and tips, after each drive, the driver's speed, acceleration, and braking are evaluated on a five-point scale. A combined safe driving score out of 100 is also provided. This report will enable drivers to verify both the route taken and locations where dangerous driving was detected and provide them simple tips on each aspect of driving.

Apart from driving-behaviour, vehicular information alerts will also be provided that include –the operational state of active safety devices, tire pressure, electronic key charge status, among other items.

Depending on the monthly report, a detailed evaluation will enable drivers to review their monthly driving results, along with safe driving score and insurance premiums and discounts will be determined based on the driver's safe driving score.

Additional features as part of the new scheme will incorporate – real-time support during emergency situations, automatic emergency report service, previously, when customers were involved in an accident, they had to call their insurance company themselves. However, under this plan, if a large collision is detected, staff at a specialised Automatic Report Desk will place a 'safety confirmation phone call' and make any necessary arrangements in a speedy manner to reduce the burden on the customer.

Also, customers can opt not to receive safety confirmation phone calls, in which case Aioi Nissay Dowa Insurance will then send emergency contact information by email. When directly contacted by the customer, the company will make emergency tow truck arrangements, accident reports, and rental car arrangements as necessary.

Output: Toyota is bringing Japan's first telematic-driven auto insurance to market. The car manufacturer has partnered with MS&AD Insurance Group’s Aioi Nissay Dowa Insurance for the policies, making coverage available to owners of certain Toyota connected car models. The manufacturer will use data provided by these vehicles to determine premium rates. Premiums will also be able to be divided into "ownership-based" premiums and "usage-based" premiums, allowing drivers who use their cars less to experience reduced insurance costs.


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Driverless cars will be commonplace soon: XL's McGavick
 During his presentation Monday morning at IRMI’s Construction Risk Conference, XL Group Ltd. CEO Mike McGavick delivered a wake-up call that the insurance industry needs to evolve in tandem with the accelerating pace of change in a digitally powered, evolving world: Some of the innovations that will shape our collective destiny, including autonomous vehicles, will arrive faster than some may think.

“I believe completely that we’re living in the Renaissance of the insurance industry,” McGavick told the audience at the J.W. Marriott in downtown Indianapolis during the IRMI conference’s kickoff session. “The rate of change is extraordinary, and will not slow down.”

Output: Autonomous vehicles are likely to be on the roads sooner than expected, said XL Group's CEO Mike McGavick. The insurance industry needs to accept and react to the pace of change, he added. Rather than keep up with technology, insurers have actually stepped back from development, McGavick said. The industry can react by changing the way risk is pooled while also altering and developing liability theory.


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Renewables won't replace baseload for 'foreseeable future': Lazard
 Dive Brief:

Lazard has analyzed of the financials of energy from various generation sources, and storage for different applications, finding clean energy resources are broadly declining in cost.

of the financials of energy from various generation sources, and storage for different applications, finding clean energy resources are broadly declining in cost. But while renewables are "increasingly cost-competitive" and storage technology "holds great promise," the firm said alternative energy systems alone "will not be capable of meeting the baseload generation needs of a developed economy for the foreseeable future."

are "increasingly cost-competitive" and storage technology "holds great promise," the firm said alternative energy systems alone "will not be capable of meeting the generation needs of a developed economy for the foreseeable future." Factors contributing to the declining costs include lower financing costs, declining capital expenditures per project, and increased Industry competition. The levelized cost of energy for utility-scale solar and onshore wind declined approximately 6% from last year, according to the reports. Lithium-ion capital costs are expected to decline as much as 36% over the next five years.

Dive Insight:

Lazard's analysis of power generation and storage costs solidifies the conventional wisdom that these clean resources are declining in cost, but it also highlights the wide variability depending on use case.

The report on energy storage concludes the technology is sparking much discussion right now but "it is not currently cost competitive in most applications." There are some applications where energy storage pencils out, relating primarily to strengthening the grid, reducing bills and participating in demand response.

Most of the expected future decline in storage costs will result from manufacturing and engineering improvements in batteries, and will vary widely among technologies. Lithium-ion capital costs are expected to decline by more than a third over the next five years.

Source: Lazard Ltd.

The cost of lithium-ion batteries for peaker replacement currently runs $282/MWh to $347/MWh, and is expected to decline again next year. In distribution use cases the costs and expectations are similar, but in microgrids the costs are slightly higher, running from $363/MWh to $386/MWh.

Behind-the-meter storage costs are substantially higher. In commercial applications, the costs currently run from about $900/MWh to $1,000/MWh. Residential prices can be as high as $1,274/MWh.

Like storage, the use case of renewable generation also dictates wide swings in cost.

Source: Lazard Ltd.

Rooftop solar can run anywhere from $187/MWh to $319/Mwh. Community solar can get down to around $76/MWh, with utility-scale installations even cheaper. Wind generation ranges from $30/MWh to $60/MWh, while utility-scale solar runs about $43/MWh to $53/MWh. Cobmined-cycle natural gas plants are costing between $42/MWh and $78/MWh.

Lazard's analysis shows cost declines are slowing "modestly" for utility-scale alternative energy generation, but the cost-gap with conventional resources is widening because fuel-based cost profiles have remained flat or increased. The firm said the estimated levelized cost of energy for nuclear generation increased approximately 35% versus prior estimates, reflecting increased capital costs at various nuclear facilities currently in development.

But while non-emitting resources can be cheaper than fossil fuels, that doesn't mean the end of baseload generation.

"Although alternative energy is increasingly cost-competitive and storage technology holds great promise, alternative energy systems alone will not be capable of meeting the baseload generation needs of a developed economy for the foreseeable future," the report concludes. "Therefore, the optimal solution for many regions of the world is to use complementary conventional and alternative energy resources in a diversified generation fleet."

Output: The cost of renewable energy is continuing to fall, but it will not be able to fully replace conventional generation in the foreseeable future, according to Lazard's annual reports on the levelised cost of energy and energy storage. The analysis shows utility-scale solar costs today can be as low as $43/MWh, and wind generation as low as $30/MWh, whilst gas plant generation starts at $42 per MWh. The cost of utility-scale solar and onshore wind fell about 6% from last year, while capital costs for lithium-ion batteries will fall as much as 36% over the next five years.