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Biden boosts fuel-economy standards to fight climate change

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In a major step to fight climate change, the Biden administration is raising vehicle mileage standards to significantly reduce emissions of planet-warming greenhouse gases, reversing a Trump-era rollback that loosened fuel efficiency standards.

A final rule issued Monday would raise mileage standards starting in the 2023 model year, reaching a projected industry-wide target of 40 miles per gallon by 2026. The new standard is 25% higher than a rule finalized by the Trump administration last year and 5% higher than a proposal by the Environmental Protection Agency in August.

“We are setting robust and rigorous standards that will aggressively reduce the pollution that is harming people and our planet – and save families money at the same time,” EPA Administrator Michael Regan said. He called the rule “a giant step forward” in delivering on President Joe Biden’s climate agenda “while paving the way toward an all-electric, zero-emissions transportation future.”

The move comes a day after Democratic Sen. Joe Manchin delivered a potentially fatal blow to Biden’s $2 trillion social and environmental policy bill, jeopardizing Democrats’ agenda and infuriating the White House. The West Virginia senator said he could not support the sweeping bill, which includes a host of climate proposals, saying it was too expensive and could spark inflation and expand the growing federal debt.

The now-stalled bill includes a $7,500 tax credit to buyers to lower the cost of electric vehicles.

The administration will “continue to fight tirelessly” for the EV tax credits and other incentives in the so-called Build Back Better bill, Regan said, but even without them, “we believe that we proposed a rule that is doable, it’s affordable, it’s achievable, and we’re excited about it.”

The new mileage rules are the most ambitious tailpipe pollution standards ever set for passenger cars and light trucks. The standards raise mileage goals set by the Trump administration that would achieve only 32 miles per gallon in 2026. Biden had set a goal of 38 miles per gallon in August.

The standards also will help expand the market share of zero emissions vehicles, the administration said, with a goal of battery electric and plug-in hybrid vehicles reaching 17% of new vehicles sold in 2026. EVs and plug-in hybrids are expected to have about 7% market share in 2023.

The EPA said the rule would not only slow climate change, but also improve public health by reducing air pollution and lower costs for drivers through improved fuel efficiency.

Biden has set a goal of cutting U.S. greenhouse gas emissions by at least half by 2030 as he pushes a history-making shift in the U.S. from internal combustion engines to battery-powered vehicles.

He has urged that components needed to make that sweeping change — from batteries to semiconductors — be made in the United States, too, aiming for both industry and union support for the environmental effort, with the promise of new jobs and billions in federal electric vehicle investments.

While ambitious, the new standards provide adequate lead time for auto manufacturers to comply at reasonable costs, the administration said. EPA’s analysis shows the industry can comply with the final standards with modest increases in the numbers of electric vehicles entering the fleet.

Environmental and public health groups mostly hailed the new rules, while the trade association representing most major automakers reacted cautiously.

Automakers are “committed to achieving a cleaner, safer, and smarter future,” but EPA’s final rule for greenhouse gas emissions is more aggressive than originally proposed, “requiring a substantial increase in electric vehicle sales, well above the 4% of all light-duty sales today,” said John Bozzella, president and CEO of the Alliance for Automotive Innovation. The group represents manufacturers producing nearly 99% of new cars and light trucks sold in the U.S.

“Achieving the goals of this final rule will undoubtedly require enactment of supportive governmental policies – including consumer incentives … and support for U.S. manufacturing and supply chain development,” Bozella said in a statement.

“We can all breathe a collective sigh of relief now that a strong federal clean car rule is restored,” said Morgan Folger of Environment America, an advocacy group.

Despite pushback from the auto industry, the rule will significantly reduce air and climate pollution, Folger said. She called the announcement “a win” on climate that will help create “an onramp to a future with zero emissions from our cars and trucks.”

EPA’s action is “an important step forward that will reduce greenhouse gases and air pollution and improve lung health,” added Harold Wimmer, president and CEO of the American Lung Association.

EPA called the new rule critical to address climate change. Transportation is the single largest source of greenhouse gas emissions in the United States, making up 29% of all emissions. Within the transportation sector, passenger cars and trucks are the largest contributor, accounting for 58% of all transportation-related emissions and 17% of overall U.S. carbon emissions.

The final standards will contribute toward a goal set by the 2015 Paris climate agreement to keep the increase in the global average temperature to well below 2° Celsius above pre-industrial levels, the EPA said. The U.S. rejoined the Paris agreement on Biden’s first day in office after former President Donald Trump had withdrawn the U.S. from the global pact.

The new rules would begin with the 2023 car model year and increase emissions reductions year by year through model year 2026. The rule accelerates the rate of emissions reductions to between 5 and 10% each year from 2023 through 2026, the EPA said, far higher than under previous rules.


WASHINGTON (AP)

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Microsoft’s Activision Deal Holds Climate Quarrels

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In the past, Microsoft has built strong environmental, social, and governance policies around itself, and now with the latest Activision Blizzard acquisition news, the Big Tech giant could be facing years of work to bring the gaming titan in alignment with its sustainability policies.

The Big Tech giant is already setting in motion plans to compensate the entirety of its monumental greenhouse-gas emissions. Still, the software developer might encounter certain challenges in mirroring its ambitions with Activision.

Activision has never uncovered plans to follow the lead of some of the biggest tech companies riding the wave of minimizing their detrimental effect on the planet. The company has barely disclosed any environmental, social, and governance (ESG) information and places far less sustainable policies than some of the sector’s most significant tech names.

While the deal is far from being completed – given it still needs regulatory approval – Microsoft would have to invest hefty efforts into Activision to reciprocate its sustainability policies and be applicable.

As of January 19, sustainability-driven funds exceeded $53 billion of the tech giant’s shares, placing it at the top when it came to such funds, according to data service provider Morningstar Inc.

Let’s compare this data with Activision Blizzard’s $869 million in funds. We can see that Microsoft might have a long way to actually fulfill its vision in interlocking its capabilities with those of the gaming giant.

Many factors drove Microsoft’s move to acquire Activision, and sustainability is one of them. The gaming mogul’s ESG problems, allegations of sexual harassment, and work-environment waywardness detrimentally affected the company’s share prices, sending its shares to a 6 percent drop by the end of 2021.

In its investors’ call, Microsoft emphasized investing efforts into setting groundbreaking rules to reshape Activision’s workplace culture, placing it as a priority.

While both companies are working to fill in specific gaps and mismanagement issues in Activision, the fact remains that there’s quite an ordeal of matters to be dealt with concerning managing gaps between both companies.

In Microsoft’s case, the company openly conveys many topics in its reports, ranging from “corporate social responsibility, environment, and diversity and inclusion,” according to The Wall Street Journal (WSJ).

The Washington-based company covers the amount of energy it employs from both renewable and non-renewable sources based on the region and the type of sources. The tech giant announced that it bought and consumed more than 6.8 million megawatt-hours in 2020 in North America, compared to a number exceeding 186,000 MWh from non-renewable sources.

From another aspect, Activision released its first-ever ESG document last year but failed to divulge any environmental metrics to support the report’s data.

“At this time, we are unable to collect data related to the energy and water footprint associated with our offices,” the gaming firm stated.

The reports indicate that Activision is not weaponized with the tools needed to obtain primary environmental data on its conduct.

“It will take a significant effort to collect Activision’s environmental data required to get its reporting to the same level as Microsoft,” said Joe Holman, leading the ESG practice at WithumSmith+Brown PC.

It is worth mentioning that Holman also predicted that once the acquisition reaches its final stages, it would take almost two years for Microsoft to gather the needed ESG data for the video game developer.

Activision did not immediately respond to a comment to WSJ. Microsoft refrained from commenting on the matter.

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Nissan, Mitsubishi to unveil 2030 EV plan this week

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Renault SA, Nissan Motor Co and Mitsubishi Motors Corp plan to triple their investment to jointly develop electric vehicles (EVs), two people with knowledge of the plan told Reuters.

As established automakers face pressure from new competitors and an expected shift in demand toward EVs, the French-Japanese alliance is seeking to deepen cooperation.

The three are expected to announce on Thursday a plan to invest more than 20 billion euros ($23 billion) over the next five years on EV development, the sources said. By 2030, the alliance is expected to come up with more than 30 new battery EVs underpinned by five common platforms, they said.

That is in addition to 10 billion euros the group has already spent on electrification, said the two people with knowledge of the plan.

A Nissan spokesperson declined to “comment on speculation”. Spokespeople for Renault and Mitsubishi did not respond to requests for comment.

The “Alliance to 2030” plan aims to show “intensified cooperation” among the automakers, highlighting a “shared vision on electrification and connected mobility,” one source said. The five common platforms are expected to cover 90% of EVs the companies are expected to develop and launch by 2030, the sources said.

The three-firm alliance has developed and partly deployed four common EV platforms.

One underpins EVs such as Nissan’s upcoming Ariya and Renault’s Megane EV, and another supports affordable no-frills cars by Nissan and its China market partner Dongfeng, as well as for Renault’s Dacia brand. The other two are platforms for micro minis, called “kei cars” in Japan, and light commercial vehicles.

By mid-decade, the alliance aims to deploy a fifth common platform for compact EVs designed by Renault, the sources said.

Nissan has already decided to use this platform, called CMFB-EV, and other standardised components to electrify the Nissan Micra compact car, while Renault is expected to come up with a similar EV car based on the same platform, the sources said. The Micra EV is projected to be released by the mid-2020s.

AFFORDABLE EVs

The automakers hope to make compact EVs as affordable as gasoline-fuelled vehicles of similar size, the sources said.

The automakers are expected to use common batteries and other key components. The alliance plans to jointly invest in capacity to produce in France, Britain, China and Japan a total of 220 gigawatt hours of battery capacity by 2030 under the plan, the sources said.

By standardising and sharing batteries, the alliance expects to halve battery manufacturing costs, they said.

The alliance is also expected to share solid-state lithium-ion battery technology, which Nissan has been developing, they said.

The plan had been for the leaders of Renault, Nissan and Mitsubishi to announce the 2030 plan last autumn at an event in Japan, but the announcement was postponed until this week because of a surge in COVID-19 in Japan, the sources said.

A disagreement between Nissan and Renault over the French firm’s proposals for a full-blown merger – tensions that burst into the open with the arrest of former alliance leader Carlos Ghosn in 2018 – corresponded with stalled efforts to collaborate on technology and vehicle development, people with knowledge of the matter have said.

The three automakers all have their own hybrid technologies with few shared key parts and systems. The limited cooperation in sourcing and development has raised concern within the group about the ability to achieve cost savings, one source said.

It was not immediately clear whether alliance leaders will discuss hybrids as part of their 2030 plan.

Nissan said in November it planned to spend some $18 billion over five years to accelerate vehicle electrification, launching 23 electrified vehicles – including gasoline-electric hybrids – by 2030, including 15 EVs. Half of Nissan’s vehicle mix will be electrified by 2030, including EVs and e-Power hybrids, the company said.

Renault has said its Renault brand will be 100% electric in Europe by 2030, but company officials told Reuters the target does not apply to markets outside Europe and the group’s other brands, such as Dacia.

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Sony seeks new partners for transformative EV project -executive

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Sony Group will likely add new technology partners to its electric vehicle (EV) project to help it forge a mobility business to transform cars from transportation machines to entertainment spaces, a Sony executive told Reuters.

An ongoing shift to electric cars, which are easier to build than those with internal combustion engines, is allowing new entrants into vehicle manufacturing. At the same time, autonomous driving and 5G connectivity is expected remold the auto industry by turning cars into mobile platforms for information and entertainment services.

“We see the risk of ignoring EVs as greater than the challenge they pose,” Izumi Kawanishi, the senior general manager who will manage a new Sony Mobility business, said in an interview. The coming transformation of cars was in some ways similar to how information technology turned phones into smartphones, he added.

Announcing the creation of that new mobility unit at the CES technology tech fair in Las Vegas this month, Sony Chief Executive Kenichiro Yoshida suggested for the first time that the creator of PlayStation games consoles will try to turn an EV development project started two years ago into a money-making venture.

“We understand that speed is important in terms of making a decision,” said Kawanishi, who joined the Japanese consumer electronics company as a software engineer in 1986 and heads the AI Robotics unit making Sony’s Aibo robot pet.

Kawanishi declined to say whether a final decision on whether to go ahead would come this year.

PARTNERS

So far, Sony has built two EV “Vision” prototypes with a factory in Austria owned by Canadian auto parts maker Magna International, which also makes cars for firms including BMW, Mercedes Benz and Toyota Motor Corp .

Other members of its Europe-based project include German auto parts maker Bosch, French automotive technology company Valeo SE and Hungarian autonomous vehicle start-up AImotive.

To bring an EV to market, Sony would likely have to invest heavily in plant and equipment. Tesla Inc, which delivered its first electric vehicle in 2008, has spent billions of dollars to make its business viable.

Sony will also have to take on traditional carmakers too, such as Toyota, General Motors Co and Volkswagen AG, which are spending tens of billions of dollars to beat the EV newcomers.

Sony is one of a growing list of technology firms exploring automotive opportunities, including iPhone maker Apple Inc, South Korea’s LG Electronics Taiwan’s Foxconn, and China’s Alibaba Group

Sony will pick new partners for its EV project based on the technology they can bring to the project, without regard to their nationality, Kawanishi said, when asked if Sony would partner with Chinese companies.


TOKYO (Reuters)

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