.png)
Decarbonizing Heavy Industry: Organizational Shallow Dives
This report was last updated in December 2022.
Our “shallow dive” investigations focus on understanding an organization’s general level of promise across Giving Green criteria (e.g., evidence of effectiveness) and topic-specific criteria (e.g., alignment with strategy-specific theory of change). We publish our shallow dive reports to promote research transparency. These reports represent our initial research output on each organization, which we use to determine whether our team should prioritize investigating an organization in greater depth. For more information on our research process, please see “2022 updates to Giving Green’s approach and recommendations.” Donors specifically interested in decarbonizing heavy industry may want to consider the below organizations as part of a portfolio of organizations supporting industrial decarbonization work.
This page includes shallow dives on the following organizations:
Industrial Innovation Initiative (I3)
Summary
What is the Industrial Innovation Initiative? The Industrial Innovation Initiative (I3) is a coalition of US companies in the industrial sector, labor groups, and environmental organizations primarily focused on advancing policies to decarbonize the industrial sector. It has focused on carbon management, hydrogen, energy efficiency, electrification, and federal and state procurement of low emissions construction materials (known in some jurisdictions as “Buy Clean”).
How could it reduce greenhouse gases? Since I3 has a broad mission and large suite of activities, there are many ways in which I3’s efforts might reduce greenhouse gases (GHGs). It primarily expects to have an indirect impact through its advocacy efforts to support decarbonization policies or legislation passing. I3 might also have a direct impact if its industry members reduce emissions based on inter-industry learning due to I3 convenings.
What is evidence of its effectiveness? Since I3 was only recently launched, there is no direct evidence of its effectiveness. I3 told us that its advocacy efforts have helped helped inform state and federal policy. Our general impression is that coalition-building such as I3’s allows for wider support to advance a cause, but may also result in reducing the cause to its “lowest common denominator.” We think I3 generally has corporate and political support, which could allow it to be highly effective at advancing participant-aligned policy to reduce GHG.
What is its cost-effectiveness? As a rough plausibility check, we developed a back-of-the-envelope calculation (BOTEC) to estimate the cost-effectiveness of I3. Overall, we guess I3 could plausibly be within the range of cost-effectiveness we would consider for a top recommendation, but have low confidence in the ability of our BOTEC to estimate I3’s general cost-effectiveness.
Is there room for more funding? As of September 2022, I3 is completely funded by climate philanthropies through mid-2023. If it exceeds its fundraising goals, it would generally expand both its federal work (e.g., hiring government affairs consultants) and state-level work (e.g., producing location-specific factsheets & being a bridge to federal policy), and communications capacity to educate media and policymakers on industrial solutions.
Are there co-benefits or adverse effects? We think the co-benefits and adverse effects of I3’s work are largely aligned with those outlined in our decarbonizing heavy industry deep dive. This includes reduced local air/water pollution and unclear effects on employment.
Key uncertainties / Open questions: We are most uncertain about I3’s collaboration with industrial corporations, geographic focus, and room for more funding. We have some concern that I3’s efforts might result in an overemphasis on carbon management, that I3’s focus on the US Midcontinent Region might limit its scalable impact, and that additional funding directed due to Giving Green may displace funds I3 may have otherwise received from climate philanthropists.
Bottom line / Next steps: In general, we think industrial decarbonization efforts are at a relatively early stage, and we look forward to following I3’s progress in this space as we learn more about which strategies and decarbonization pathways may be most promising.
What is the Industrial Innovation Initiative?
The Industrial Innovation Initiative (I3) is a coalition of US companies in the industrial sector, labor groups, and environmental organizations focused on advancing policies to decarbonize the industrial sector.[1] To become a member, stakeholders must support I3’s Federal and State Policy Blueprint.[2] I3 is the result of a partnership between two larger environmental nonprofit organizations: the Great Plains Institute (GPI) and World Resources Institute (WRI).[3] It operates at the state, regional, and federal levels, and generally focuses on coalition-led and consensus-based policy development and implementation, technology demonstration and adoption, and market development.[4]
I3 has a broad range of focus areas (i.e., energy efficiency, carbon management, hydrogen, electrification, procurement, and “innovative approaches”).[5] Understanding the role of carbon management for industrial applications was the initial impetus for I3, and is additionally an area of expertise for GPI.[6] It is also increasingly focused on hydrogen, since there is growing federal and state-level attention focused on hydrogen efforts (e.g., regional clean hydrogen hubs).[7] Following the passage of the Inflation Reduction Act and Infrastructure Investment and Jobs Act, I3 has also focused on the creation of market demand for low-carbon industrial materials, including heavy industry products, through federal and state procurement initiatives such as “Buy Clean.”[8]
Its activities include hosting convenings of different stakeholders, directly advocating to governments, producing policy analyses/recommendations, and coordinating letters of support.[9] As of September 2022, it has two full-time staff, and receives additional support from GPI/WRI staff and external consultants.[10]
How could it reduce greenhouse gases? (Importance)
Industry accounts for around 30% of global greenhouse gas (GHG) emissions.[11] Of that, about 80% comes from energy consumption.[12] Since I3 has a broad mission and large suite of activities, there are many ways in which I3’s efforts might reduce GHGs.
I3 told us that it primarily expects to indirectly impact GHG emissions by increasing the likelihood that policies or legislation supporting lower-carbon industrial production are passed or more effectively implemented.[13] For example, I3 said it expects to focus on “Buy Clean” policies in specific states; if passed, these policies would mandate lower-carbon government purchases of industrial products.[14] Some I3 members have also expressed interest in participating in the implementation of hydrogen hubs, which could reduce emissions by enabling industries to use hydrogen instead of fossil fuels in their industrial processes.[15] In October 2022, I3 announced a “Carbon Action Alliance” that, according to I3, will be the nation’s first integrated federal and state carbon management advocacy network operating at federal, state, and regional levels.[16]
I3 might also directly impact GHG emissions if its industry members (e.g., Dow Chemical) reduce emissions based on collaborations with other I3 members or sector-based learning due to I3 convenings. I3 told us the diversity of its members could enable cross-pollination among different sectors; we are uncertain what this might look like in practice, but generally understand it to include sharing of decarbonization policy priorities, ideas, knowledge, and technologies across sectors that might not otherwise be shared or adopted to the same degree.[17]
I3 produced a simple potential decarbonization pathway for the US industrial sector, in which GHG emissions decline by 10% by 2030 from 2019 levels, and an additional 5% annually until 2050, as a way to illustrate bridging the gap between near-term action and what is needed in the longer-term to reach net-zero by midcentury[18]:
I3 focuses on US companies and decarbonization efforts, but this could have global spillovers if US corporations have foreign operations, technological innovation scales up globally, and/or other countries replicate policies developed in the US.
What is evidence of its effectiveness? (Tractability)
It is our understanding that I3 primarily convenes private sector industrial corporations. Since I3 was only launched recently, there is currently no direct evidence of its effectiveness (in terms of outputs that can be directly attributed to avoided/removed GHG).
I3 has released several consensus policy positioning documents, including policy recommendations and letters of support.[19] I3 told us that its advocacy efforts have “helped inform state and federal policy,” and that it “gives voice to industrial stakeholders dedicated to the decarbonization of their sector by 2050.”[20]
Our general impression is that coalition-building such as I3’s allows for wider support to advance a cause, but may also result in reducing the cause to its “lowest common denominator” —ensuring consensus across members may result in advocacy for a cause of relatively low impact. Since I3 helps to align and amplify industrial corporations’ decarbonization efforts, our impression is that it may be most effective in advancing initiatives that are broadly aligned with industry interests (e.g., carbon capture and storage, clean hydrogen).[21]
From speaking with climate change stakeholders familiar with I3’s efforts, we believe I3 generally has corporate industry support, and that its policy priorities have political support.[22] Based on this and its organizational coalition model, we think I3 could be highly effective at advancing broadly accepted industry interests to reduce GHG.
What is its cost-effectiveness?
As a rough plausibility check, we developed a back-of-the-envelope calculation (BOTEC) to estimate the cost-effectiveness of I3 (in terms of dollars per metric ton of CO2-equivalent reduced/avoided). As a proxy for I3’s cost-effectiveness, we estimated the potential cost-effectiveness of I3's state-level policy outreach efforts in Louisiana, which I3 told us it has prioritized due to Louisiana’s “early mover” status (e.g., it already has a climate action plan) and relatively large industrial footprint.[23]
This BOTEC includes highly subjective guess parameters and should not be taken literally. In particular, we guessed the likelihood that I3’s efforts would cause Louisiana to pass a GHG-reducing policy (e.g., a “Buy Clean” initiative), the number of industrial facilities impacted by such a policy, and the reductions in facility-level GHG due to the policy.
Overall, we guess I3 could plausibly be within the range of cost-effectiveness we would consider for a top recommendation.[24] This is primarily due to the low cost of I3 expanding its efforts, the policy’s applicability to a large portion of industrial facilities, and relatively large GHG emissions from industrial facilities such as those in Louisiana. We have low confidence in the ability of our BOTEC to estimate I3’s general cost-effectiveness.[25]
Is there room for more funding? (Neglectedness)
As of September 2022, I3 is 100% funded by climate philanthropies through mid-2023.[26] Since I3 operates as an initiative of a larger NGO, we do not believe it has its own 501(c)(3) status for us to review annual budgets.[27]
I3 said if it exceeds its fundraising goals, it would expand its federal and state-level work. Additionally, it might hire government affairs consultants, increase staff travel, and host more convenings.[28] To assist with local political advocacy, it might also produce location-specific factsheets or regrant funds to location-specific organizations.[29]
Are there major co-benefits or adverse effects?
We think the co-benefits or adverse effects of I3’s work are largely aligned with those outlined in our decarbonizing heavy industry deep dive. These effects include reduced pollution and unclear effects on employment.
Key uncertainties / Open questions
We are most uncertain about I3’s collaboration with industrial corporations, geographic focus, and room for more funding.
Collaboration with industrial companies: As a core part of I3’s strategy, it works directly with industrial corporations (among other stakeholders) to support the advancement of industrial decarbonization policies and frameworks. Carbon management, and carbon capture in particular, are a focus of its work as it relates to process emissions in the production of carbon-intensive industrial products, such as cement.[30] Some environmentalists allege that support for carbon capture and storage (CCS) may enable carbon-intensive practices and corporations to exist longer than they otherwise would have.[31] We do not view general support for CCS as a concern, since the International Energy Agency notes that achieving net-zero emissions for industrial applications without CCS could be significantly more expensive.[32] However, we have some concern that I3’s efforts might result in an overemphasis (in terms of funding and attention) on carbon management relative to other decarbonization opportunities.
Geographic focus: Due in part to its origins and connections to GPI, I3 is geographically focused on the US Midcontinent Region.[33] We think this makes sense due to its local expertise and networks, but have some uncertainty about whether this might limit its scalable impact. This could be because decarbonization opportunities in the US Midcontinent Region may be relatively less likely than elsewhere, or (if successful) may have lower likelihood to result in international spillovers.
Room for more funding: From speaking with I3 and other climate change stakeholders, it is our impression that I3 may continue to be well-funded, and that additional funding directed due to Giving Green may displace funds I3 may have otherwise received from climate philanthropists.[34] We are uncertain about this, as it also partially depends on I3’s growth and future funding needs.
Bottom line / Next steps
Though I3 has a limited track record, it is our impression that I3 could play a useful role in convening industrial stakeholders and generally advocating for faster and broader industrial decarbonization. Overall, we guess that I3 could plausibly be within the range of cost-effectiveness we would consider for a top recommendation. Donors interested in developing a portfolio of industrial decarbonization giving opportunities may want to consider I3. However, since I3 partially serves as a coalition for industrial corporations, we have some concerns it may cause a disproportionate amount of focus on decarbonization technologies and policies that already have corporate and political support. We are also uncertain about whether I3 has room for more funding.
In general, we think industrial decarbonization efforts are at a relatively early stage, and we look forward to following I3’s progress in this space as we learn more about which strategies and decarbonization pathways may be most promising.
Endnotes
[1] Email correspondence with I3, 2022-12-12; “The scope and complexity of the decarbonization challenge across industrial sectors” https://industrialinnovation.org/about/; For a list of current members, see: https://industrialinnovation.org/about/
[2] Email correspondence with I3, 2022-12-12.
[3] “Our conveners…Great Plains Institute…World Resources Institute” https://industrialinnovation.org/about/
[4] Email correspondence with I3, 2022-12-12; “through policy development and implementation; technology demonstration and adoption; and demand-side market development at state, regional, and federal levels.” https://industrialinnovation.org/about/
[5] Email correspondence with I3, 2022-12-12; Focus areas: https://industrialinnovation.org/context/; Carbon management focus: Correspondence with Industrial Innovation Initiative, 2022-09-29.
[6] Correspondence with Industrial Innovation Initiative, 2022-09-29.
[7] Focus: Correspondence with Industrial Innovation Initiative, 2022-09-29; Hubs: https://www.energy.gov/oced/regional-clean-hydrogen-hubs
[8] Correspondence with Industrial Innovation Initiative, 2022-09-29.
[9] Correspondence with Industrial Innovation Initiative, 2022-09-29, and https://industrialinnovation.org/our-work/
[10] Correspondence with Industrial Innovation Initiative, 2022-09-29; Inflation Reduction Act: https://www.congress.gov/bill/117th-congress/house-bill/5376/text; Infrastructure Investment and Jobs Act: https://www.congress.gov/bill/117th-congress/house-bill/3684/text.
[11] “Emissions by sector…Energy use in industry: 24.2%...Direct Industrial Processes: 5.2%” https://ourworldindata.org/emissions-by-sector
[12] Calculation: 0.242/(0.242+0.052)=0.82. “Emissions by sector…Energy use in industry: 24.2%...Direct Industrial Processes: 5.2%” https://ourworldindata.org/emissions-by-sector
[13] Email correspondence with I3, 2022-12-12.
[14] Correspondence with Industrial Innovation Initiative, 2022-09-29.
[15] Membership interest: Correspondence with Industrial Innovation Initiative, 2022-09-29. Hydrogen hubs: “The production, processing, delivery, storage, and end-use of clean hydrogen, including innovative uses in the industrial sector, are crucial to DOE’s strategy for achieving President Biden’s goal of a 100 percent clean electrical grid by 2035 and net-zero carbon emissions by 2050.” https://www.energy.gov/oced/regional-clean-hydrogen-hubs
[16] “OCTOBER 26, 2022, NEW ORLEANS—The Great Plains Institute today launched the Carbon Action Alliance, a new initiative to align and grow a network of government, industry, labor, environmental, and community partners to work together…will be the nation’s first integrated federal and state advocacy network for public action on carbon management at federal, state, and regional levels.” https://industrialinnovation.org/2022/10/26/carbon-action-alliance-launches-to-spur-carbon-reduction-efforts-nationwide/
[17] Correspondence with Industrial Innovation Initiative, 2022-09-29.
[18] https://industrialinnovation.org/context/
[19] See https://industrialinnovation.org/our-work/ for examples.
[20] Email correspondence with I3, 2022-12-12.
[21] This is our general impression based on intuition, as well as correspondence with climate change stakeholders with some knowledge of I3’s work: Anonymized correspondence, 2022-09-23; Anonymized correspondence, 2022-09-29.
[22] This is our general impression based on intuition, as well as correspondence with climate change stakeholders with some knowledge of I3’s work: Anonymized correspondence, 2022-09-23; Anonymized correspondence, 2022-09-29.
[23] Email correspondence with I3, 2022-12-12.
[24] As a heuristic to guide our research prioritization, we consider something to plausibly be within the range of cost-effectiveness we would consider for a top recommendation if its BOTEC-estimated cost-effectiveness is within an order of magnitude of $1/tCO2e (i.e., less than $10/tCO2e).
[25] We describe our confidence as low/medium/high to increase readability and avoid false precision. Since these terms can be interpreted differently, we use rough heuristics to define them as percentage likelihoods our takeaway (i.e., [not] plausibly within the range of cost-effectiveness we would consider recommending) is correct. Low = 0-70%, medium = 70-90%, high = 90-100%.
[26] Correspondence with Industrial Innovation Initiative, 2022-09-29.
[27] We searched for “industrial innovation” on 2022-11-11 using the ProPublica Nonprofit Explorer, which didn’t any relevant results.
[28] Correspondence with Industrial Innovation Initiative, 2022-09-29.
[28] Correspondence with Industrial Innovation Initiative, 2022-09-29.
[29] Correspondence with Industrial Innovation Initiative, 2022-09-29.
[30] Correspondence with Industrial Innovation Initiative, 2022-09-29.
[31] For example: in a February 2022 letter to Senator Patrick Leahy and Representative Rosa DeLauro, dozens of signatories representing various environmental groups argued that policies supporting carbon capture would prop up fossil-based technologies. “Fossil fuel industry efforts to use carbon capture, blue hydrogen, and various new “advanced” energy fuels to greenwash activities will support a new era of fossil fuel and petrochemical development.” https://www.foodandwaterwatch.org/wp-content/uploads/2022/02/Stop-Funding-Fossil-Fuel-Greenwashing-Signatories.pdf
[32] “In the [Limited CO2 Storage scenario variant], the limited availability of CO2 storage would result in a doubling of the marginal CO2 abatement cost by 2060 relative to the CTS where CCUS is widely available.” https://www.iea.org/reports/transforming-industry-through-ccus
[33] “Midcontinent Region map. Includes Illinois, Indiana, Michigan, Minnesota, Nebraska, North Dakota, Ohio, South Dakota, Wisconsin, Kansas, Montana.” https://www.usgs.gov/media/images/midcontinent-region; Focus: Correspondence with Industrial Innovation Initiative, 2022-09-29.
[34] Correspondence with Industrial Innovation Initiative, 2022-09-29.; Anonymized correspondence, 2022-09-23; Anonymized correspondence, 2022-09-29.
RMI
Summary
What is RMI? RMI is a nonprofit focused on reducing emissions from energy production and use in the US, China, India, Africa, Southeast Asia, and the Caribbean. Its issue areas include carbon-free industries, buildings, mobility, and electricity.
How could it reduce greenhouse gases? RMI can reduce emissions from heavy industry by helping industry stakeholders transition to low-carbon alternatives. Establishing demand and a supply chain for these products could have international spillover effects if these actions reduce costs and can scale to new geographies. Its work on carbon-free buildings, mobility, and electricity can also reduce emissions by substituting high-carbon products (e.g., diesel trucks) with lower-carbon products (e.g., electric trucks).
What is evidence of its effectiveness? RMI’s wins in 2021 include launching a scorecard program that measures states’ progress in reducing emissions, deploying electric commercial vehicles in various countries, and successfully advocating for a clean energy plan in North Carolina. RMI also told us it directly advanced key provisions of the US Inflation Reduction Act (IRA) legislation.
What is its cost-effectiveness? We have not evaluated the cost-effectiveness of RMI’s work. For a general cost-effectiveness analysis, please see our deep dive report on decarbonizing heavy industry.
Is there room for more funding? RMI’s total revenue and gains were about $125M in 2021. RMI told us that its fiscal year 2023 budget and planned programming have increased significantly relative to the previous year, and that additional funds would generally be used to support these increases.
Are there co-benefits or adverse effects? RMI’s work on electrifying vehicles and homes could improve air quality and reduce associated health risks.
Key uncertainties / Open questions: It is unclear whether RMI has additional room for more funding. Also, there is uncertainty on the marginal cost-effectiveness of donating to RMI given its considerable budget. Additionally, there is uncertainty on how RMI would use donations, given that a significant fraction of its budget is unrestricted.
Bottom line / Next steps: Given that additional money donated via Giving Green could shift some of RMI’s funds to activities unrelated to decarbonizing heavy industry, we need to do more work to understand its full portfolio of work.
What is RMI?
RMI, formerly known as Rocky Mountain Institute, is a nonpartisan organization focused on reducing emissions from energy production and use.[1] Its global programs include carbon-free industries, buildings, mobility, and electricity in the US, China, India, Africa, Southeast Asia, and the Caribbean. It also has crosscutting work on scaling climate technologies, building tools that make emissions visible, helping cities meet their climate commitments, and identifying pathways to a clean transition. Our understanding is that RMI conducts research, provides technical advice, and convenes stakeholders to target various market levers (e.g., finance, technology) across its broad portfolio of work. In this shallow dive, we briefly summarize RMI’s overall portfolio, but mainly focus our analysis on its work on decarbonizing heavy industry. We focus on heavy industry because it is one the areas we closely investigated in 2022, and not because it is necessarily a priority focus of RMI. (See 2022 updates to Giving Green’s approach and recommendations for more information.)
RMI was founded in 1982 and now has offices in the US and China.[3] RMI India, which focuses on decarbonizing India’s transportation and power sectors, was incorporated in 2019.[4] RMI has around 600 global staff.[5] As of November 2022, it has 20 employees working on decarbonizing industry.[6]
How could it reduce greenhouse gases? (Importance)
Carbon-free industries
RMI has partnered with the recently founded Mission Possible Partnership (MPP), a coalition of climate leaders, to work on decarbonizing heavy industry.[7] MPP has grown to include nearly 300 partners across industry, finance, and policy.[8] MPP plans on engaging with its stakeholders (e.g., industry, customers, capital providers, relevant governments) to develop a shared vision for decarbonization across various industries, embed this roadmap into corporate strategies, and help build the necessary market infrastructure.[9] MPP aims to create demand for low-carbon products and make them more competitive with legacy technologies.[10] These goals can reduce emissions by decreasing low-carbon production costs and encouraging producers to switch to low-carbon products.
MPP’s core partners include RMI, Energy Transitions Commission, the We Mean Business Coalition, and the World Economic Forum.[11]
RMI’s other work on carbon-free industries includes:
Certifying the global gas supply: RMI has developed open-source tools for tracking methane emissions. It worked with Systemiq to establish MiQ, a methane emissions certification standard for oil and gas operators.[12] According to RMI, it works with over 4%of the global gas supply and about 17% of the US supply.[13] This work likely helps oil and gas operators reduce methane emissions at their sources.
Supporting green hydrogen production: Green hydrogen is produced from splitting water into hydrogen and oxygen. It can reduce emissions from heavy industry and transport by substituting for fossil fuels. Green Hydrogen Catapult, launched by the United Nations and supported by RMI, is a coalition of industry stakeholders committed to increasing green hydrogen production 50x within this decade.[14] It has also called for setting frequent targets for green hydrogen production, increasing green hydrogen’s competitiveness relative to conventional fuels, and providing incentives and market support.[15] RMI said it initially advised the US Department of Energy on developing regional clean hydrogen hubs.[16]
Carbon-free buildings
RMI’s carbon-free buildings program includes:
REALIZE: REALIZE is a platform for aggregating demand for retrofits and coordinating the supply chain.[17]
Embodied Carbon Initiative: Embodied Carbon Initiative advocates for low-carbon concrete procurement.[18]
Retrofitting, upgrading, and constructing buildings: RMI has various efforts related to upgrading existing facilities and scaling up the construction of net-zero buildings.[19]
These activities could decrease emissions by reducing US building-related emissions (e.g., heating and cooling). Our impression is that RMI’s work could have international spillover effects if its influence on the global supply chain reduces the cost of low-carbon construction materials and if its efforts can be scaled up or replicated abroad.
Carbon-free mobility
RMI has partnered with governments and industry to roll out initial deployments of medium- and long-haul commercial vehicles. It has provided technical advice to policymakers and utilities to support this transition, such as how to establish charging infrastructure.[20] This work can reduce emissions by retiring diesel vehicles and replacing them with cleaner alternatives. According to RMI, if it scaled its work on deploying electric commercial vehicles globally, it could reduce CO2 emissions by 2.2 billion metric tons over the lifetime of vehicles sold by 2030.[21]
Carbon-free electricity
RMI helps global utilities and regulators build and scale clean energy grids by developing decarbonization pathways and establishing best practices.[22] Its activities include developing business models and regulatory frameworks and convening energy practitioners.[23] It has also reported on various financial approaches that could ease a transition from coal power.[24]
What is evidence of its effectiveness? (Tractability)
We think RMI could be impactful at coalition-building among industries. So far, 200 industry leaders have endorsed MPP’s strategies for decarbonizing aluminum, ammonia, and steel production.[25] This work is still in its early stages, and it is not yet clear how successful this will be. We view this as a promising signal of RMI’s potential effectiveness, but are unsure how much we can attribute this endorsement to RMI, specifically. We will keep an eye on MPP’s progress.
Various climate wins that RMI cited in its 2021-22 annual report include the following:
State Climate Scorecards: RMI launched its State Climate Scorecards program in 2021 to outline six key states’ current policies for decarbonizing across electricity, transportation, buildings, and industry and measure their progress.[26] According to RMI, various nonprofits have used this work to guide climate action.[27]
Energy Solutions for North Carolina Act: In 2021, the bipartisan House Bill 951: Energy Solutions for North Carolina was signed into law, establishing a mandate for state-wide greenhouse gas reductions.[28] According to RMI, it helped North Carolina’s Department of Environmental Quality lead a stakeholder process that informed its Clean Energy Plan.[29]
Deploying zero-emissions commercial vehicles: RMI has advised the initial deployment of electric trucks and/or buses in India, Bermuda, and the US.[30]
More generally, RMI also told us its federal policy team and techno-economic experts directly advanced key provisions of the US Inflation Reduction Act (IRA) legislation, which it considers to be a major win for its overall effectiveness.[31]
What is its cost-effectiveness?
We have not conducted a cost-effectiveness analysis (CEA) specific to RMI’s work. Please see our deep dive report on decarbonizing heavy industries for a general CEA. Based on this, we think RMI’s decarbonizing heavy industry efforts could plausibly be within the range of cost-effectiveness we would consider for a top recommendation. However, we haven’t examined the cost-effectiveness of RMI’s specific heavy industry activities, and also haven’t estimated the cost-effectiveness of its other climate change focus areas.
Is there room for more funding? (Neglectedness)
In fiscal year 2021, RMI’s total revenue and gains were about $125M, of which about $88M was unrestricted.[32] This revenue was a sharp increase from fiscal year 2020’s $67M.[33] In its 2021-22 annual report, RMI listed 25 donors who gave at least $1M, including the Bezos Earth Fund, Breakthrough Energy, ClimateWorks Foundation, and Google.org. It listed another 15 donors who gave at least $500,000.[34] RMI told us its fiscal year 2023 budget and planned programming have increased significantly relative to the previous year, and that additional funds would generally be used to support these increases.[35] Our impression is that RMI is relatively well-funded with a diverse set of major donors.
Are there major co-benefits or adverse effects?
RMI’s work on electrifying vehicles could reduce tailpipe exhaust, which is related to several health problems.[36] Electrifying households can also have health benefits. For example, replacing gas stoves with cleaner alternatives mitigates the emission of pollutants that can cause or worsen respiratory illnesses.[37]
Key uncertainties / Open questions
Room for more funding: RMI has a large budget with what appears to be a robust and diverse set of donors. We have the impression that RMI’s fundraising will likely be successful without additional money directed by Giving Green.
Marginal cost-effectiveness of additional donation: If RMI does have room for more funding, its large budget may mean that the marginal cost-effectiveness of donating to RMI may be lower than contributing to an organization with lower revenue. For example, current Giving Green top recommendation Good Food Institute has a 2023 fundraising goal of $35M.[38] Since we are uncertain how RMI might spend additional funding, we are uncertain how to estimate the marginal cost-effectiveness. It is possible that additional donations could still be highly cost-effective (e.g., if they allow RMI to expand to a new geography it would not otherwise work in).
Funding implications of restricted donations to RMI: Donors can restrict donations to specific focus areas.[39] However, restricted contributions may not necessarily increase funding for a particular cause. For example, donating to decarbonizing heavy industry could shift unrestricted funding that RMI would have spent on heavy industry to a different focus area (e.g., carbon-free buildings).
Bottom line / Next steps
Although heavy industry is a large source of emissions, philanthropic efforts to decarbonize it have been neglected. (For more information, see our deep dive report on decarbonizing heavy industry.) However, key uncertainties remain that keep us from recommending RMI as a top recommendation this year. For example, we are uncertain about RMI’s room for more funding, as well as how restricted donations might affect how RMI distributes funds across its focus areas. To improve our assessment of RMI, we would need to learn more about its organization-wide funding decision-making and examine its efforts through a wider lens instead of focusing our analysis on decarbonizing heavy industry. We may look into this in the future.
Endnotes
[1] Nonpartisan: “”RMI’s nonpartisan, apolitical approach has led to some big wins in the past year.” “RMI 2021-22 Annual Report” 2022. RMI’s focus: “RMI is tackling the climate crisis by focusing on its main contributor: energy production and use, which represents 70% of global greenhouse gas emissions.” “Our Work” 2022.
[2] RMI’s work: We named the various programs and geographies listed on RMI’s Our Work page, n.d. Global South: RMI lists Africa, Southeast Asia, and island nations under its Global South Program. “RMI’s Global South Program works across three core geographies - Africa, Southeast Asia, and island nations - to address barriers to the energy transition and achieve radical implementation at scale.” “Global South” n.d.Caribbean: The island nations RMI works in are in the Caribbean. “With an independent, objective, and fact-based approach, the Islands Energy Program brings experience gained from engagements with island governments, utilities, regulators, and civil society from over 18 Caribbean nations to solve the toughest energy challenges.” Islands Energy Program n.d.
[3] Founding date: “In 1982, Rocky Mountain Institute was founded as a 501(c)3 nonprofit aiming to radically improve America’s energy practices.” “40 Years of Impact” n.d. Locations: Within the US, RMI has offices in Colorado (Basalt, Boulder), New York, Washington DC, and California. RMI also has a China office. “Office Locations” n.d.
[4] “RMI India was incorporated in 2019. We have been working with the public and private sectors to enable India’s clean energy and mobility future. Our ongoing work includes partnerships with the central government, state and city governments, utilities, industry leaders, and civil society organizations. We have a deep focus on the transportation and power sectors, which currently account for more than 50 percent of India’s carbon emissions and particulate pollution.” “Who We Are” n.d.
[5] “We celebrated this anniversary milestone by reflecting on how we’ve evolved, from a small team working out of the Lovins’s house in the early 1980s to the 600-person international powerhouse we are today.” “RMI 2021-22 Annual Report” 2022.
[6] RMI has 20 people listed under its “Climate-Aligned Industries” team. “Meet Our Team” n.d.
[7] About MPP: “The Mission Possible Partnership is an alliance of climate leaders focused on supercharging decarbonisation across the entire value chain of the world’s highest-emitting industries in the next 10 years.” “Supercharging Industrial Decarbonisation” n.d. Recently founded: On 2021-01-27, RMI posted a blog post saying, “Today, the Center will bring the work of Poseidon to the next level by partnering with a new initiative that will accelerate industrial decarbonization across sectors: the Mission Possible Partnership (MPP).” “Mission Possible Partnership: Joining Forces to Decarbonize Heavy Industry” 2021.
[8] “Supported by an expanding network of nearly 300 partners across industry, finance and policy, we are empowering high-ambition sector initiatives in seven target sectors, together working towards one end goal: net-zero emissions.” “Supercharging Industrial Decarbonisation” n.d.
[9] Process: “1. Convene a critical mass of ambitious industry leaders and agree on a shared vision for sector decarbonisation. 2. Leverage existing analysis to develop viable, high-ambition, open-source sector transition strategies to net-zero emissions by 2050. 3. Secure commitments from industry leaders that tie concrete actions to the net-zero roadmap milestones. 4. Build the market infrastructure needed to track and support ongoing decarbonisation progress.” “Our Approach” n.d. Industries: “MPP will orchestrate high-ambition disruption through net-zero industry platforms for the seven aforementioned sectors: aluminum, cement, chemicals, iron and steel, aviation, shipping, and heavy road transport.” “Mission Possible Partnership: Joining Forces to Decarbonize Heavy Industry” 2021.
[10] MPP’s five key policy areas for unlocking investment and technology scale-up include creating demand for low-carbon products, supporting profitable markets, leveling the playing field between high-carbon and low carbon technologies, supporting breakthrough projects, and ensuring sufficient supply. “Engaging Policymakers on a 1.5°C Future” n.d.
[11] “The Partnership, which launched today, is led by four core partners: the Energy Transitions Commission, Rocky Mountain Institute, the We Mean Business coalition, and the World Economic Forum.” “Mission Possible Partnership: Joining Forces to Decarbonize Heavy Industry” 2021.
[12] Tools and standards: “RMI’s Oil and Gas Solutions initiative devises actionable, cost-effective solutions to make the oil and gas we use today as low-emitting as possible while we transition to a zero-carbon energy system. Our groundbreaking, open-source tools generate climate intelligence that makes emissions visible and sets data-driven standards for industry operators and gas buyers to make informed decisions.” “RMI 2021-22 Annual Report” 2022. MiQ: “MiQ, an independent nonprofit established by RMI and Systemiq, was founded to build a market that helps to rapidly reduce methane emissions from the oil and gas sector.” “RMI 2021-22 Annual Report” 2022.
[13] “Today, MiQ is the fastest growing trusted methane emissions certification standard, working with over 4 percent of the global gas supply, expected to grow to 5.5 percent by the end of 2022. In the United States, MiQ covers 17 percent of supply, and aims to get to 100 percent within the next decade.” “RMI 2021-22 Annual Report” 2022.
[14] Launched by the UN and supported by RMI: “The Green Hydrogen Catapult, a coalition of green hydrogen leaders, convened with the support of the UN High Level Champions for Climate Action and hosted by RMI, today announced members’ commitment to develop 45 GW of electrolyzers with secured financing in the next five years.” “The Green Hydrogen Catapult Announces Expansion of World-Leading Green Hydrogen Deployment ” 2021. Green Hydrogen Catapult’s goals: “At COP26, we launched the Green Hydrogen Catapult, a coalition of industry-first movers committed to growing renewable hydrogen production by fifty-fold within this decade.” “RMI 2021-22 Annual Report” 2022
[15] “GHC members made an additional call for policy and business leaders to facilitate and accelerate green hydrogen adoption through the following actions: Matching GHC’s ambitions by setting and regularly updating five-year targets instead of longer-term, 2030-focused goals. Ensuring at least equal market conditions for all fuels (conventional and green) to create fair competition in energy markets
[16] “RMI’s Industries and US Policy programs provided initial advice to the US Department of Energy on how to invest $8 billion to develop regional clean hydrogen “hubs,” which connect hard-to-electrify industries such as steel and fertilizer to green hydrogen projects.” “RMI 2021-22 Annual Report” 2022.
[17] “REALIZE is a market facilitation platform that seeks to establish high volume net zero carbon retrofit delivery programs across the US. Market facilitation activities include aggregating retrofit demand while coordinating the supply chain to deploy high-quality, prefabricated retrofit packages that are easy to install and are financed through utility cost savings.” “REALIZE” n.d.
[18] “The overarching goal of RMI’s embodied carbon project is to support the reduction of carbon embodied in building materials in line with the climate targets for 1.5°C: reducing global emissions 50% by 2030, and 100% by 2050. We are changing how builders build, increasing corporate investment in embodied carbon, and enacting policies to create greater demand for, and adoption of, low-embodied-carbon products.” “Embodied Carbon Initiative” n.d.
[19] Examples: “Pathways to Zero: Reducing buildings’ climate impact through zero-carbon road mapping, grid interactive buildings, and low-embodied carbon materials… Portfolio Energy Optimization: A disruptive and scalable approach to commercial building retrofits, driving deep financial and energy savings… Residential Energy+: Customer-focused solutions that empower and motivate US homeowners to invest in home energy performance improvements.” “Carbon-Free Buildings” n.d.
[20] “RMI will: Support final-mile early adoption and establish three medium/long haul electric trucking corridors. Partner with government and industry to roll out initial deployments. Equip policymakers and utilities with the technical know-how to accelerate change; establish three charging infrastructure ’density zones’ in target geographies.” “Carbon-Free Mobility” n.d.
[21] “Scaling Shoonya across the US, Europe, the UK, Southeast Asia, and Latin America could lead to 2.2 gigatons of CO2 reductions over the lifetime of vehicles sold by 2030.” “RMI 2021-22 Annual Report” 2022.
[22] “RMI will: Prove that clean energy portfolios are the highest-value resource via analysis and support to global utilities and regulators. Establish best-practice wholesale market design and empower grid system planners to support high penetrations of renewables. Develop utility decarbonization pathways, partner on lighthouse examples, and support regulators and advocates to enact bold regulations.” “Carbon-Free Electricity” n.d.
[23] “What We Do. Business Models and Regulatory Design: Supporting comprehensive regulatory and business model reform and innovation to flip utilities from foes to champions. e–Lab: Electricity Innovation Lab: Helping unlikely allies work together in developing critical electricity solutions. Managing the Coal Capital Transition: Financing models to support retirement while offering a path toward a clean power sector.” “Carbon-Free Electricity” n.d.
[24] “Immediately retiring and replacing uncompetitive coal assets should be a foregone conclusion. However, long-term contracts and noncompetitive tariffs insulate 93 percent of global coal capacity from market competition with cheaper and cleaner renewables… Our report describes several innovative financial approaches such as ratepayer backed securitization and debt forgiveness via reverse auctions that capture all three elements of the transition.” “How to Retire Early: Making Accelerated Coal Phaseout Feasible and Just” 2020.
[25] “More than 200 industry leaders have endorsed strategies from the Mission Possible Partnership (MPP) to decarbonise some of world’s hardest-to-abate, carbon-intensive industries in this decade.” “Industry leaders back plan for zero-emissions aluminium, ammonia and steel” 2022.
[26] “RMI is analyzing this state action through a series of novel climate scorecards, launched in June. To date, the State Climate Scorecards show the progress of six key states — California, Colorado, Illinois, New Jersey, New York, and Washington. These front-runner states are key to tackling climate-warming pollution nationwide. In addition to setting bold targets for clean energy and climate action, the states analyzed makeup roughly a fifth of US greenhouse gas emissions. The scorecards measure progress across four major economic sectors — electricity, transportation, buildings, and industry. Using the Energy Policy Simulator for states, developed by RMI and Energy Innovation, we developed a detailed picture of each state’s current progress on climate and where current policies will take them by 2030. The scorecards are a free resource to support states in achieving their climate goals.” “RMI 2021-22 Annual Report” 2022.
[27] “The scorecards are already guiding climate change action by nonprofits, state governments, and government coalitions. For example: the Midwest Building Decarbonization Coalition plans to use scorecard data to galvanize new action in Illinois; New Yorkers for Clean Power are exploring how to use the RMI analysis; and The Energy Foundation is using the scorecards to guide its state strategy.” “RMI 2021-22 Annual Report” 2022.
[28] Passage of bill: Content of bill: “On October 13, 2021, North Carolina Governor Roy Cooper signed into law the first major piece of climate legislation in the tar heel state in recent years. North Carolina House Bill 951—Energy Solutions for North Carolina—was passed by both chambers of the North Carolina state legislature with bipartisan support.” “Achieving Clean Energy Legislation in a Moderate State” 2021. Content of bill: “The Energy Solutions for North Carolina Act is a breakthrough for advocates and stakeholders across the state who have been working for years to advance a clean energy agenda. The Act directs the NCUC to take all reasonable steps to reduce carbon emissions from the electric sector 70 percent by 2030 and 100 percent by 2050.” “Achieving Clean Energy Legislation in a Moderate State” 2021.
[29] “RMI fueled these bold actions by helping North Carolina’s Department of Environmental Quality (DEQ) lead an inclusive stakeholder process that led to the development of a Clean Energy Plan.” “RMI 2021-22 Annual Report” 2022.
[30] India: “RMI and India’s governmental think tank, NITI Aayog, are changing that by promoting zero emissions delivery vehicles through an innovative campaign: Shoonya.” “RMI 2021-22 Annual Report” 2022. Bermuda: “This past April, Bermuda moved one big step closer to achieving its climate targets by welcoming the first 30 electric buses into service to replace its aging diesel buses. This represents nearly one-third of its overall public bus fleet and is the first step of its multiyear strategy to fully electrify the entire bus fleet. These 30 electric buses will save $10 million in fuel and maintenance over their lifetime. RMI served as a strategic and technical advisor to the Government of Bermuda, providing detailed analysis, market intelligence, and strategic guidance to make this project possible.” “RMI 2021-22 Annual Report” 2022. USA: “The Run proved that certain trucking segments — from vans to heavy-duty semis — are more than ready to go electric. And when they do, we could save 100 million tons of CO2 — equivalent to eliminating 25 coal-fired power plants.” “RMI 2021-22 Annual Report” 2022.
[31] Correspondence with RMI, 2022-12-22.
[32] “Total revenue, gains, other support, and net assets released from restrictions. Without donor restrictions: 87,766,545. With donor restrictions: 36,901,423. Total: 124,667,968” "Rocky Mountain Institute Consolidated Financial Report with Supplemental Information June 30, 2021" 2021.
[33] “Total revenue, gains, other support, and net assets released from restrictions. Without donor restrictions: 63,251,985. With donor restrictions: 3,840,822. Total: 67,092,807” "Rocky Mountain Institute Consolidated Financial Report with Supplemental Information June 30, 2021" 2021.
[34] Please see RMI’s donor list in “RMI 2021-22 Annual Report” 2022.
[35] Correspondence with RMI, 2022-12-21.
[36] “In India, the transport sector is the fastest growing source of carbon emissions. And tailpipe exhaust from gas- and diesel-powered vehicles are a leading cause of devastating health problems, from asthma, bronchitis, and pneumonia to lung cancer, strokes, and heart disease.” “RMI 2021-22 Annual Report” 2022.
[37] “Burning gas emits pollutants that can cause or worsen respiratory illnesses. Residential appliances like gas-powered furnaces and water heaters vent pollution outside, but the stove "is the one gas appliance in your home that is most likely unvented," says Brady Seals with RMI, formerly Rocky Mountain Institute.” “We need to talk about your gas stove, your health and climate change” 2021.
[38] Correspondence with GFI, 2022-11-01.
[39] Correspondence with RMI, 2022-12-21.