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Shell bets on EVs, Chevron backs a cleantech co., and more trending Houston energy transition news

Here's what news on EnergyCapital trended this week. Photo via Getty Images

Editor's note: From Shell's commitment to electric vehicle charging stations to a DOE-backed initiative in Houston, these are the top headlines that resonated with EnergyCapital readers on social media and daily newsletter this week.

Shell fuels energy transition with roll out of EV charging stations

After recently divesting from wind and solar energy initiatives, Shell has plans to quadruple EV charging stations in the next several years. Photo via shell.com

As it downshifts sales of fuel for traditional vehicles, energy giant Shell is stepping up its commitment to public charging stations for electric vehicles.

In a new report on energy transition, Shell lays out an aggressive plan for growing its public network of charging stations for electric vehicles (EVs). The company plans to boost the global number of public EV charging stations from about 54,000 today to around 70,000 by 2025 and about 200,000 by 2030.

The projected growth from today to 2030 would represent a 270 percent increase in the number of Shell-operated EV charging stations.

“We have a major competitive advantage in terms of locations, as our global network of service stations is one of the largest in the world,” Shell says in the report. Continue reading.

Houston initiative selected for DOE program developing hubs for clean energy innovation

A Houston-based initiative has been selected by the DOE to receive funding to develop clean energy innovation programming for startups and entrepreneurs. Photo via Getty Images

Houston has been selected as one of the hubs backed by a new program from the United States Department of Energy that's developing communities for clean energy innovation.

The DOE's Office of Technology Transitions announced the the first phase of winners of the Energy Program for Innovation Clusters, or EPIC, Round 3. The local initiative is one of 23 incubators and accelerators that was awarded $150,000 to support programming for energy startups and entrepreneurs.

The Houston-based participant is called "Texas Innovates: Carbon and Hydrogen Innovation and Learning Incubator," or CHILI, and it's a program meant to feed startups into the DOE recognized HyVelocity program and other regional decarbonization efforts. Continue reading.

Chevron backs carbon capture tech company in $45M investment round

Boulder, Colorado-based ION Clean Energy announces it has raised $45 million in financing. Photo via Getty Images

Chevron New Energies has a new cleantech company in its portfolio.

Boulder, Colorado-based ION Clean Energy announces it has raised $45 million in financing. The round was led by Chevron New Energies with participation from New York-based Carbon Direct Capital. Founded in 2008, ION's carbon dioxide capture technologies lower costs and make CO2 capture a more viable option for hard-to-abate emissions.

“We have truly special solvent technology. It is capable of very high capture efficiency with low energy use while simultaneously being exceptionally resistant to degradation with virtually undetectable emissions. That’s a pretty powerful combination that sets us apart from the competition. The investments from Chevron and Carbon Direct Capital are a huge testament to the hard work of our team and the potential of our technology,” ION founder and Executive Chairman Buz Brown says in a news release. Continue reading.

Houston engineering firm tapped as service partner for clean hydrogen production facility

The study is part of First State Hydrogen's plan to provide clean energy to Delaware and the U.S. mid-Atlantic region. Photo via Getty Images

A Houston company has scored an engineering services contract on a clean hydrogen production facility in the U.S. mid-Atlantic region.

KBR announced that it has been awarded the contract by First State Hydrogen, which is building an electrolysis-powered green hydrogen production project. The study is part of First State Hydrogen's plan to provide clean energy to Delaware and the U.S. mid-Atlantic region.

"We are excited to be a part of this important project that will contribute toward a cleaner, more sustainable world," KBR Sustainable Technology Solutions President Jay Ibrahim says in a statement. "This award highlights KBR's extensive and innovative clean hydrogen expertise, in providing solutions that matter, and our strategic commitment to the energy transition." Continue reading.

Rice names new leader for prestigious nanotechnology, materials science institute

Junichiro Kono has assumed leadership of the Smalley-Curl Institute at Rice University. Photo via Rice.edu

A distinguished Rice University professor has assumed the reins of a unique institute that focuses on research within nanoscience, quantum science, and materials science.

Junichiro Kono has assumed leadership of the Smalley-Curl Institute, which houses some of the world’s most accomplished researchers across fields including advanced materials, quantum magnetism, plasmonics and photonics, biophysics and bioengineering, all aspects of nanoscience and nanotechnology, and more.

“With his great track record in fostering international research talent — with student exchange programs between the U.S., Japan, Taiwan, China, Singapore and France that have introduced hundreds of students to new cultures and ways of researching science and engineering — Jun brings a wealth of experience in building cultural and technological ties across the globe,” Ramamoorthy Ramesh, executive vice president for research, says. Continue reading.

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A View From HETI

Lawyers for a Tesla shareholder who sued to block the pay package contended that shareholders who had voted for the 10-year plan in 2018 had been given misleading and incomplete information. Photo via cdn.britannica.com

For a second time, a Delaware judge has nullified a pay package that Tesla had awarded its CEO, Elon Musk, that once was valued at $56 billion.

Last week, Chancellor Kathaleen St. Jude McCormick turned aside a request from Musk's lawyers to reverse a ruling she announced in January that had thrown out the compensation plan. The judge ruled then that Musk effectively controlled Tesla's board and had engineered the outsize pay package during sham negotiations.

Lawyers for a Tesla shareholder who sued to block the pay package contended that shareholders who had voted for the 10-year plan in 2018 had been given misleading and incomplete information.

In their defense, Tesla's board members asserted that the shareholders who ratified the pay plan a second time in June had done so after receiving full disclosures, thereby curing all the problems the judge had cited in her January ruling. As a result, they argued, Musk deserved the pay package for having raised Tesla's market value by billions of dollars.

McCormick rejected that argument. In her 103-page opinion, she ruled that under Delaware law, Tesla's lawyers had no grounds to reverse her January ruling “based on evidence they created after trial.”

What will Musk and Tesla do now?

On Monday night, Tesla posted on X, the social media platform owned by Musk, that the company will appeal. The appeal would be filed with the Delaware Supreme Court, the only state appellate court Tesla can pursue. Experts say a ruling would likely come in less than a year.

“The ruling, if not overturned, means that judges and plaintiffs' lawyers run Delaware companies rather than their rightful owners — the shareholders,” Tesla argued.

Later, on X, Musk unleashed a blistering attack on the judge, asserting that McCormick is “a radical far left activist cosplaying as a judge.”

What do experts say about the case?

Legal authorities generally suggest that McCormick’s ruling was sound and followed the law. Charles Elson, founding director of the Weinberg Center for Corporate Governance at the University of Delaware, said that in his view, McCormick was right to rule that after Tesla lost its case in the original trial, it created improper new evidence by asking shareholders to ratify the pay package a second time.

Had she allowed such a claim, he said, it would cause a major shift in Delaware’s laws against conflicts of interest given the unusually close relationship between Musk and Tesla’s board.

“Delaware protects investors — that’s what she did,” said Elson, who has followed the court for more than three decades. “Just because you’re a ‘superstar CEO’ doesn’t put you in a separate category.”

Elson said he thinks investors would be reluctant to put money into Delaware companies if there were exceptions to the law for “special people.”

What will the Delaware Supreme Court do?

Elson said that in his opinion, the court is likely to uphold McCormick's ruling.

Can Tesla appeal to federal courts?

Experts say no. Rulings on state laws are normally left to state courts. Brian Dunn, program director for the Institute of Compensation Studies at Cornell University, said it's been his experience that Tesla has no choice but to stay in the Delaware courts for this compensation package.

Tesla has moved its legal headquarters to Texas. Does that matter?

The company could try to reconstitute the pay package and seek approval in Texas, where it may expect more friendlier judges. But Dunn, who has spent 40 years as an executive compensation consultant, said it's likely that some other shareholder would challenge the award in Texas because it's excessive compared with other CEOs' pay plans.

“If they just want to turn around and deliver him $56 billion, I can't believe somebody wouldn't want to litigate it,” Dunn said. “It's an unconscionable amount of money.”

Would a new pay package be even larger?

Almost certainly. Tesla stock is trading at 15 times the exercise price of stock options in the current package in Delaware, Morgan Stanley analyst Adam Jonas wrote in a note to investors. Tesla's share price has doubled in the past six months, Jonas wrote. At Monday’s closing stock price, the Musk package is now worth $101.4 billion, according to Equilar, an executive data firm.

And Musk has asked for a subsequent pay package that would give him 25 percent of Tesla's voting shares. Musk has said he is uncomfortable moving further into artificial intelligence with the company if he doesn't have 25 percent control. He currently holds about 13 percent of Tesla's outstanding shares.

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