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Expert: Using data to reduce Houston’s oil and gas carbon footprint

guest column

"To solve the climate crisis, confidence in emissions data is crucial." Photo via Getty Images

Sustainability has been top of mind for all industries as we witness movements towards reducing carbon emissions. For instance, last year, the Securities and Exchange Commission (SEC) proposed a new rule that requires companies to disclose certain climate-related activities in their reporting on a federal level. Now, industries and cities are scrambling to ensure they have strategies in the right place.

While the data behind sustainability poses challenges across industries, it is particularly evident in oil and gas, as their role in energy transition is of the utmost importance, especially in Texas. We saw this at the COP26 summit in Glasgow in November 2021, for example, in the effort to reduce carbon emissions on both a national and international scale and keep global warming within 1.5 degrees Celsius.

The event also made it clear achieving this temperature change to meet carbon neutrality by 2030 won’t be possible if organizations rely on current methods and siloed data. In short, there is a data problem associated with recent climate goals. So, what does that mean for Houston’s oil and gas industry?

Climate is a critical conversation – and tech can help

Houston has long been considered the oil and gas capital of the world, and it is now the epicenter of energy transition. You can see this commitment by the industry in the nature of the conferences as well as the investment in innovation centers.

In terms of the companies themselves, over the past few years each of the major oil and gas players have organized and grown their low carbon business units. These units are focused on bringing new ideas to the energy ecosystem. The best part is they are not working alone but joining forces to find solutions. One of the highest profile examples is ExxonMobil’s Carbon Capture and Underground Storage project (CCUS) which directly supports the Paris Agreement.

Blockchain technology is needed to improve transparency and traceability in the energy sector and backing blockchain into day-to-day business is key to identifying patterns and making decisions from the data.

The recent Blockchain for Oil and Gas conference, for instance, focused on how blockchain can help curate emissions across the ecosystem. Recent years have also seen several additional symposiums and meetings – such as the Ion and

Greentown Houston – that focus on helping companies understand their carbon footprint.

How do we prove the data?

The importance of harmonizing data will become even more important as the SEC looks to bring structure to sustainability reporting. As a decentralized, immutable ledger where data can be inputted and shared at every point of action, blockchain works by storing information in interconnected blocks and providing a value-add for insuring carbon offsets. To access the data inside a block, users first need to communicate with it. This creates a chain of information that cannot be hacked and can be transmitted between all relevant parties throughout the supply chain. Key players can enter, view, and analyze the same data points securely and with assurance of the data’s accuracy.

Data needs to move with products throughout the supply chain to create an overall number for carbon emissions. Blockchain’s decentralization offers value to organizations and their respective industries so that higher quantities of reliable data can be shared between all parties to shine a light on the areas they need to work on, such as manufacturing operations and the offsets of buildings. Baking blockchain into day-to-day business practice is key in identifying patterns over time and making data-backed decisions.

Oil and gas are key players

Cutting emissions is not a new practice of the oil and gas industry. In fact, they’ve been cutting emissions estimates by as much as 50 percent to avoid over-reporting.

The traditional process of reporting data has also been time-consuming and prone to human error. Manually gathering data across multiple sources of information delivers no real way to trace this information across supply chains and back to the source. And human errors, even if they are accidental, pose a risk to hefty fines from regulatory agencies.

It’s a now-or-never situation. The industry will need to pivot their approaches to data gathering, sharing, and reporting to commit to emissions reduction. This need will surely accelerate the use of technologies, like blockchain, to be a part of the energy transition. While the climate challenges we face are alarming, they provide the basis we need for technological innovation and the ability to accurately report emissions to stay in compliance.

The Energy Capital of the World, for good

To solve the climate crisis, confidence in emissions data is crucial. Blockchain provides that as well as transparency and reliability, all while maintaining the highest levels of security. The technology provides assurance that the data from other smart technologies, like connected sensors and the Internet of Things (IoT), is trustworthy and accurate.

The need for good data, new technology, and corporate commitment are all key to Houston keeping its title as the energy capital of the world – based on traditional fossil fuels as well as transitioning to clean energy.

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John Chappell is the director of energy business development at BlockApps. This article originally ran on InnovationMap.

The deadline to apply to participate in an upcoming energy-focused event is approaching. Photo courtesy of Rice

Rice Alliance calls for participants for its annual energy conference

now's the time to apply

This year marks the 20th anniversary of Energy Tech Venture Day, a one-day symposium for energy innovation put on by the Rice Alliance for Technology and Entrepreneurship. The organization is currently calling for applications for startups interested in participating.

The event is taking place on September 21 at Rice University and will bring together energy innovators, investors, corporate leaders, and the rest of the energy ecosystem. The programming will include panels and discussions as well as startup pitches from the Rice Alliance's Clean Energy Accelerator 2023 cohort.

In addition to the CEA pitches, energy tech startups from around the world can apply to be a part of the day and be in the running to be recognized as a select group as the "most-promising" at the conclusion of the pitches. Applications can be filled out online and are due July 14. Registration is also open online.

According to Rice, 90 or so companies will be selected to participate in one-on-one meetings with around 75 investors. The organization conducts a unique matchmaking round that pairs up investors and founders for four to 10 of these office hour meetings which will take place the day before the main event.

On the day of the Energy Tech Venture Day, around 40 companies will pitch to the rest of the crowd. At the end of the day and based off the investor feedback from the one-on-one meetings, 10 energy tech startups will be deemed the most-promising businesses and be presented with awards.

Last year, over a third of the companies that pitched were based in the Houston area. Two Houston-based companies received awards at the end of the day, including:

  • Kanin Energy, which works with heavy Industry to turn their waste heat into a clean baseload power source. The platform also provides tools such as project development, financing, and operations.
  • Syzygy Plasmonics, which is commercializing its light-reacting energy, which would greatly reduce carbon emissions in the chemical industry. The technology originated out of Rice University.
Houston now has 333 hybrid electric vehicles and 88 battery electric vehicles. Photo via houstontx.gov

City of Houston’s EV fleet and charging capabilities are set to expand

new wheels

The City of Houston is getting closer to its goal of all non-emergency, light-duty municipal vehicles to be electric by 2030.

According to late-June status report from the city, Houston now has 333 hybrid electric vehicles and 88 battery electric vehicles. An additional 67 battery electric pickups, 20 hybrid electric pickups, and 21 hybrid electric SUVs deliveries are expected to be up and running before the end of the calendar year, and expects to receive 27 battery-electric SUVs and 13 battery-electric pickups in the next 12 months.

"With almost half of carbon emissions in Houston coming from the transportation sector and a majority of those emissions coming from single occupancy vehicles, electrification is an important part of our climate action plan," Mayor Sylvester Turner said in the statement. "I am pleased to see the ongoing progress and am confident we will meet our goals."

According to Evolve Houston — a public-private partnership founded with CenterPoint, NRG, Shell, and the University of Houston to promote EV sales — about 9 percent of new cars in Houston were registered as EVs last year. This means that Houston's EV adoption rate was 2.5 percent over the US average, according to the statement.

As part of the Houston Climate Action Plan, the city is also working with Evolve Houston to build upon the Bayou City's EV charging infrastructure as well.

Houston currently has 57 installed chargers, two of which are DC fast chargers, according to the status report. The city recently signed a contract to purchase 144 level 2 battery chargers from Siemens and another 15 chargers are slated to be installed at the Houston Health Department's Stadium Drive location in the coming weeks.

Due to supply chain issues, the City's Fleet Management Department is also considering rolling out a mobile charging option and home-charging vehicles for emergency response employees to help reduce costs while still moving toward the city's goals.

Evolve Houston, founded in 2019 through Houston's Climate Action Plan, relaunched about a year ago with a new Equity Program to address poor air quality and limited access to public transportation in vulnerable communities.

It's one of many efforts related to Houston's goal of reaching carbon neutrality by 2050 and leading the global energy transition. In March the city partnered with The Hertz Corp. to triple Houston's EV rental fleet, as well add to the city's charging infrastructure and EV education and training opportunities. In recent years the city has launched a solar co-op, opened new labs and is slated to introduce a new fleet of 20 battery-powered electric buses in the near future.
Just what does 'energy transition' mean, anyway? Photo via Shutterstock

Defining ‘energy transition’ — and the semantics involved in it

Guest column

The term “energy transition” is fraught with misconceptions, but not just because of the varied interpretation of the term “transition.” The Energy101 series on EnergyCapitalHTX.com brings clarity to both terms with simple and direct information that anyone can understand. As explored in a previous conversation with ChatGPT, we are all part of the Energy Industry, so its high time we all understood it.

DEFINING TERMINOLOGY

Merriam-Webster defines transition as “a change or shift from one state, subject, place, etc. to another.” The popular interpretation of ‘energy transition’ implies a complete shift away from energy produced from fossil fuels to energy produced from renewable sources. This isn’t entirely accurate–let’s explore why.

“The challenge of our lifetime is addressing [the] dual challenge of meeting increased global energy demand while confronting global climate change” says Jane Stricker, executive director of the Houston Energy Transition Initiative and senior vice president, Greater Houston Partnership. This globally inclusive definition of ‘energy transition’ focuses on addressing objectives instead of proffering solutions–a common project management viewpoint through which opportunities are explored.

It's a simple, but effective, way to expand one’s line of thinking from acute problem solving to broader root-cause analysis. In other words, it is how we elevate from playing checkers to mastering chess.

DEFINING THE OPPORTUNITY

The United Nations tells us the world’s population reached 8 billion in late 2022, an increase of more than one billion people in just over a decade. During the same time frame, the number of people around the world without consistent access to electricity declined from approximately 1.2 billion to 775 million per the International Energy Agency (IEA) 2022 World Energy Outlook report. A commendable feat, no doubt, but the fact remains that about 10% of the world’s population still lives in energy poverty–and that number is increasing.

The first half of Stricker’s sentiment, the challenge of “meeting increased global energy demand” reflects these statistics, albeit almost poetically. To state the issue more plainly, one could ask, “how do we get more energy to more people?” Taking it one step further, we can split that inquiry into two basic questions: (1) how to get more energy, and (2) how to reach more people. This is where it gets interesting.

As explored in the inaugural Energy 101 article, energy is converted into usable form through one of three reactions. Mechanical and nuclear reactions that create electricity for immediate consumption are often deemed “cleaner” than those produced by chemical reaction, but the challenges of delivering more energy consistently and reaching more people are left shortchanged due to intermittent production and limited distribution mechanisms.

In recent history, this has left us to rely upon energy produced by chemical reactions from fossil fuels and/or batteries. Batteries have inherently been the more expensive option, mostly because of the limited supply of minerals necessary to effectively store and transport energy for later use in these contained systems. Hence, the heavy reliance on cheap fossil fuels.

REFINED CONSTRAINTS DEMAND NEW SOLUTIONS

With price as the determining factor influencing the modern world’s energy supply, oil and natural gas have scrambled to compete with coal, which is affordable and easily transportable. However, coal has one major drawback–using it accounts for approximately 20% of carbon emissions, more than oil and gas industrial use, combined, per calculations from the U.S. Energy Information Agency.

We have a duty to get more energy to more people, “while confronting global climate change,” as Stricker states. In the context of energy poverty, where more consistent access to more electricity needs to reach more people, energy needs not only be abundant, reliable, affordable, and accessible, but also, less toxic.

So far, we have yet to find a solution that meets all these conditions, so we have made trade-offs. The ‘energy transition’ merely reflects the energy industry’s latest acceptance of the next hurdle to enhance our lives on earth. As depicted by the image from the IEA below, it most certainly reflects a reduction in the reliance on coal for electricity production, but how that energy reduction will be off set remains yet to be determined.

It's an opportunity ripe for exploration while existing sources push to meet the expanding definition of sustainable energy–a shift in evaluation criteria, some might say. Perhaps even a transition.

Stacked chart showing demand of natural gas, coal, and oil from 1900 to 2050 (estimated)Demand for natural gas and oil are expected to level out, as demand for coal shrinks to meet goals for lower carbon emissions. Photo courtesy of IEA, license CC by 4.0Demand for natural gas and oil are expected to level out, as demand for coal shrinks to meet goals for lower carbon emissions. Photo courtesy of IEA, license CC by 4.0


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Lindsey Ferrell is a contributing writer to EnergyCapitalHTX and founder of Guerrella & Co.

Energy sources are often categorized as renewable or not, but perhaps a more accurate classification focuses on the type of reaction that converts energy into useful matter. Photo by simpson33/Getty Images

How is energy produced?

ENERGY 101

Many think of the Energy Industry as a dichotomy–old vs. new, renewable vs. nonrenewable, good vs. bad. But like most things, energy comes from an array of sources, and each kind has its own unique benefits and challenges. Understanding the multi-faceted identity of currently available energy sources creates an environment in which new ideas for cleaner and more sustainable energy sourcing can proliferate.

At a high level, energy can be broadly categorized by the process of extracting and converting it into a useful form.

Energy Produced from Chemical Reaction

Energy derived from coal, crude oil, natural gas, and biomass is primarily produced as a result of bonds breaking during a chemical reaction. When heated, burned, or fermented, organic matter releases energy, which is converted into mechanical or electrical energy.

These sources can be stored, distributed, and shared relatively easily and do not have to be converted immediately for power consumption. However, the resulting chemical reaction produces environmentally harmful waste products.

Though the processes to extract these organic sources of energy have been refined for many years to achieve reliable and cheap energy, they can be risky and are perceived as invasive to mother nature.

According to the 2022 bp Statistical Review of World Energy, approximately 50% of the world’s energy consumption comes from petroleum and natural gas; another 25% from coal. Though there was a small decline in demand for oil from 2019 to 2021, the overall demand for fossil fuels remained unchanged during the same time frame, mostly due to the increase in natural gas and coal consumption.

Energy Produced from Mechanical Reaction

Energy captured from the earth’s heat or the movement of wind and water results from the mechanical processes enabled by the turning of turbines in source-rich environments. These turbines spin to produce electricity inside a generator.

Solar energy does not require the use of a generator but produces electricity due to the release of electrons from the semiconducting materials found on a solar panel. The electricity produced by geothermal, wind, solar, and hydropower is then converted from direct current to alternating current electricity.

Electricity is most useful for immediate consumption, as storage requires the use of batteries–a process that turns electrical energy into chemical energy that can then be accessed in much the same way that coal, crude oil, natural gas, and biomass produce energy.

Energy Produced from a Combination of Reactions

Hydrogen energy comes from a unique blend of both electrical and chemical energy processes. Despite hydrogen being the most abundant element on earth, it is rarely found on its own, requiring a two-step process to extract and convert energy into a usable form. Hydrogen is primarily produced as a by-product of fossil fuels, with its own set of emissions challenges related to separating the hydrogen from the hydrocarbons.

Many use electrolysis to separate hydrogen from other elements before performing a chemical reaction to create electrical energy inside of a contained fuel cell. The electrolysis process is certainly a more environmentally-friendly solution, but there are still great risks with hydrogen energy–it is highly flammable, and its general energy output is less than that of other electricity-generating methods.

Energy Produced from Nuclear Reaction

Finally, energy originating from the splitting of an atom’s nucleus, mostly through nuclear fission, is yet another way to produce energy. A large volume of heat is released when an atom is bombarded by neutrons in a nuclear power plant, which is then converted to electrical energy.

This process also produces a particularly sensitive by-product known as radiation, and with it, radioactive waste. The proper handling of radiation and radioactive waste is of utmost concern, as its effects can be incredibly damaging to the environment surrounding a nuclear power plant.

Nuclear fission produces minimal carbon, so nuclear energy is oft considered environmentally safe–as long as strict protocols are followed to ensure proper storage and disposal of radiation and radioactive waste.

Nuclear to Mechanical to Chemical?

Interestingly enough, the Earth’s heat comes from the decay of radioactive materials in the Earth’s core, loosely linking nuclear power production back to geothermal energy production.

It’s also clear the conversion of energy into electricity is the cleanest option for the environment, yet adequate infrastructure remains limited in supply and accessibility. If not consumed immediately as electricity, energy is thus converted into a chemical form for the convenience of storage and distribution it provides.

Perhaps the expertise and talent of Houstonians serving the flourishing academic and industrial sectors of energy development will soon resolve many of our current energy challenges by exploring further the circular dynamic of the energy environment. Be sure to check out our Events Page to find the networking event that best serves your interest in the Energy Transition.


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Lindsey Ferrell is a contributing writer to EnergyCapitalHTX and founder of Guerrella & Co.

Looks like green really is the new black in a city that’s known for being all blue. Photo courtesy of Zach Tarrant, HoustonTexans.com

Another Houston sports team commits to fighting climate change

EVERYDAY ENERGY

The Houston Texans rocked the football world in early May with their historic back-to-back first-round all-star offense/defense NFL draft picks, but that’s not the only groundbreaking news they had planned this month. In partnership with 1PointFive, the Texans’ Preferred Carbon Removal Partner, the team announced the Touchdown for Trees program to recapture carbon emissions – and the hearts of fans.

“As part of our partnership with 1PointFive, we kicked off our Touchdown for Trees initiative last week at Hermann Park Conservancy,” Houston Texans Senior Vice President of Partnerships Jerry Angel tells EnergyCapitalHTX. “We’re looking forward to continuing to work together to make a difference across our community during the 2023 Season.”

For every touchdown scored by the Texans in the 2022, 2023, and 2024 seasons, the team pledges to plant 1.5 trees in the greater Houston area. To kick off the initiative, Houston Texans staff and cheerleaders gathered in Hermann Park Conservancy on May 11 to plant 25 inaugural trees. The group also removed invasive species from the area to eliminate competition for the newly planted trees and restore native habitat conditions.

Planting trees to fight climate change has gathered significant momentum in recent years, as each individual tree can offset approximately 22 pounds of carbon emissions per year over its first 20 years of life, according to conservative calculations from OneTreePlanted.org. The One Trillion Tree Initiative, announced at the 2020 World Economic Forum in January 2023, could effectively reduce carbon emissions by 20% year-over-year for the next two decades through reforestation efforts.

Like other carbon capture solutions, reforestation must be pursued with proper planning and care, so as not to waste time nor resources. But many tout reforestation as the simplest way to reduce carbon emissions and meet all 17 of the United Nations’ Sustainable Development Goals simultaneously.

With this commitment to reforestation, the Houston Texans join the Astros, Rockets, Dash, and Dynamo in a collective effort to fight climate change. Earlier this spring, the Houston Astros partnered with 1PointFive in an agreement to purchase carbon dioxide removal credits from the new Direct Air Capture facility near Odessa in Ector County, TX.

Like the Texans, the soccer teams of Houston are donating trees for each victory achieved this calendar year. In partnership with Shell Energy, the Dynamo and Dash have already committed to 1,750 new trees from their 5 aggregate wins this spring.

Additionally, each of the homes of these Houston teams follows in the footsteps of Houston’s original green arena, the Toyota Center. One of 10 Green NBA arenas to earn LEED certification, the home of the Houston Rockets boasts energy efficient lighting, electric submeters, and an abundance of trees and vegetation in an urban setting to reduce greenhouse gases by over 3,000 tons annually.

Shell Energy is giving the home of the Dynamo and Dash a decarbonization facelift this year, with energy efficient LED-lighting throughout, installation of EV charging stations, and the use of on-site renewable energy generation systems.

Similar efforts continue to roll out at Minute Maid Park and NRG Stadium, including food sustainability programs, dedicated recycling for aluminum, plastic, and cardboard, and complete conversion to more efficient lighting solutions on the field, in the bathrooms, and even out in the parking lots.

Whether rooting for the home team or cheering on the visitors, fans that attend Houston events at these stadiums and arenas benefit from the knowledge and experience of local talent stewarding such energy transition initiatives. Maybe it’s time to bring back the historic chant of the Oilers, with a modern twist, “go blue–and green!”

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3 organizations in Houston receive funding for DOE-backed programming

coming soon

A clean technology program backed by the Wells Fargo Foundation and co-administered by the United States Department of Energy's National Renewable Energy Laboratory has named three Houston organizations as recipients to an annual awards program.

The Wells Fargo Innovation Incubator, a $50 million program, announced its eighth cycle of IN2 Channel Partner Strategic Awards. The program is distributing $767,000 across 15 organizations within the Channel Partner network to create impactful workshops at the upcoming Camp Cleantech event in August at CSU Spur in Denver, Colorado.

Houston-based Rice Alliance Clean Energy Accelerator, as well as Activate Global Greentown Labs, which each have Houston locations, have been named among the awards recipients. The organizations will present workshops aimed at providing critical tools and insights for clean tech startups.

"We are celebrating this year's Strategic Award winners and looking forward to Camp Cleantech," says Robyn Luhning, chief sustainability officer at Wells Fargo, in a news release. "As the real economy demands more lower-carbon solutions, Wells Fargo continues to support the scaling of new solutions for a successful shift to a low-carbon economy."

Registration for the event opens May 1. A full itinerary is available online.

The selected participants represent IN²'s broader goals of diversity, equity, and inclusion, per the release.

"The significance of this year's awards goes beyond the recognition of innovation; it embodies a concerted effort to elevate collaboration and engagement across the board," adds Sarah Derdowski, IN² program director at NREL. "Through Camp Cleantech, we're setting a new standard in how we gather, inspire, and propel our community forward."

Around $435,000 of the funding will go toward select recipients who will receive additional follow-on funding to enhance and expand their workshop content and insights towards entrepreneurs in their local networks.

Global law firm names partner to build growing infrastructure, energy transition business

new hire

An international law firm has named a new partner in the Houston office to help build its growing infrastructure and energy transition capabilities

Weil, Gotshal & Manges announced infrastructure lawyer Jacqui Bogucki has returned to the firm.

"Jacqui will be an extremely valuable addition to our growing Houston team,” says Weil Executive Partner Barry Wolf in a news release. “Her significant infrastructure experience – including in the digital sector – and strong relationships with leading investment professionals will help to advance our fast-growing infrastructure and energy transition capabilities, and will be an immediate value-add to our clients globally.”

She will advise private equity sponsors and strategic clients on a wide range of corporate transactions. Her focus will include infrastructure, digital, technology, energy transition, and oil and gas sectors. Previously, Bogucki was a partner in the Mergers & Acquisitions practice at Simpson Thacher & Bartlett LLP. Her previous stint at Weil was from 2014 through 2018.

“I am so pleased to have the opportunity to return to Weil, where I began my legal career,” says Bogucki in a news release. “It is an incredibly exciting time to be joining the Firm as it further builds out its infrastructure and energy transition capabilities. I look forward to reconnecting with former colleagues and leveraging my experience to provide the highest quality service to our clients.”

Since 2023, notable energy partners Omar Samji, Chris Bennett, Cody Carper, and Irina Tsveklova have joined Weil in Houston – with Steven Lorch joining in New York just last month.

Tesla Q1 profit falls by more than half, but stock jumps amid production of cheaper vehicles

EV evolution

Tesla’s first-quarter net income plummeted 55 percent, but its stock price surged in after-hours trading Tuesday as the company said it would accelerate production of new, more affordable vehicles.

The Austin, Texas, company said it made $1.13 billion from January through March compared with $2.51 billion in the same period a year ago.

Investors and analysts were looking for some sign that Tesla will take steps to stem its stock's slide this year and grow sales. The company did that in a letter to investors Tuesday, saying that production of smaller, more affordable models will start ahead of previous guidance.

The smaller models, which apparently include the Model 2 small car that is expected to cost around $25,000, will use new generation vehicle underpinnings and some features of current models. The company said it would be built on the same manufacturing lines as its current products.

On a conference call with analysts, CEO Elon Musk said he expects production to start in the second half of next year “if not late this year.”

New factories or massive new production lines won't be needed for the new vehicles, Musk said.

“This update may result in achieving less cost reduction than previously expected but enables us to prudently grow our vehicle volumes in a more capex efficient manner during uncertain times,” the investor letter said.

But Musk gave few specifics on just what the new vehicles will be and whether they would be variants of current models. “I think we’ve said all we will on that front,” he told an analyst.

He did say that he expects Tesla to sell more vehicles this year than last year's 1.8 million.

The company also appears to be counting on a vehicle built to be a fully autonomous robotaxi as the catalyst for future earnings growth. Musk has said the robotaxi will be unveiled on Aug. 8.

Shares of Tesla rose 11 percent in trading after Tuesday’s closing bell, but they are down more than 40 percent this year. The S&P 500 index is up about 5 percent for the year.

Morningstar analyst Seth Goldstein said the company gave guidance about its future that was clearer than in the past, allaying investor concerns about production of the Model 2 and future growth. “I think for now we're likely to see the stock stabilize," he said. “I think Tesla provided an outlook today that can make investors feel more assured that management is righting the ship.”

But if sales fall again in the second quarter, the guidance will go out the window and concerns will return, he said.

Tesla reported that first-quarter revenue was $21.3 billion, down 9 percent from last year as worldwide sales dropped nearly 9 percent due to increased competition and slowing demand for electric vehicles.

Excluding one-time items such as stock-based compensation, Tesla made 45 cents per share, falling short of analyst estimates of 49 cents, according to FactSet.

The company’s gross profit margin, the percentage of revenue it gets to keep after expenses, fell once again to 17.4 percent. A year ago it was 19.3 percent, and it peaked at 29.1 percent in the first quarter of 2022.

Over the weekend, Tesla lopped $2,000 off the price of the Models Y, S and X in the U.S. and reportedly made cuts in other countries including China as global electric vehicle sales growth slowed. It also slashed the cost of “Full Self Driving” by one third to $8,000.

Tesla also announced last week that it would cut 10 percent of its 140,000 employees, and Chief Financial Officer Vaibhav Taneja said Tuesday the cuts will be across the board. Growth companies build up duplication that needs to be pruned like a tree to continue growing, he said.

Musk has been touting the robotaxi as a growth catalyst for Tesla since the hardware for it went on sale late in 2015.

In 2019, Musk promised a fleet of autonomous robotaxis by 2020 that would bring income to Tesla owners and make their car values appreciate. Instead, they've declined with price cuts, as the autonomous robotaxis have been delayed year after year while being tested by owners as the company gathers road data for its computers.

Neither Musk nor other Tesla executives on Tuesday's call would specify when they expect Tesla vehicles to drive themselves as well as humans do. Instead, Musk touted the latest version of Tesla’s autonomous driving software — which the company misleadingly brands as “Full Self Driving” despite the fact that it still requires human supervision — and said that “it’s only a matter of time before we exceed the reliability of humans, and not much time at that.”

It didn’t take the Tesla CEO long to begin expounding on the possibility of turning on self-driving capabilities for millions of Tesla vehicles at once, although again without estimating when that might actually occur. He went on to insist that “if somebody doesn’t believe that Tesla is going to solve autonomy, I think they should not be an investor in the company.”

Early last year the National Highway Traffic Safety Administration made Tesla recall its “Full Self-Driving” system because it can misbehave around intersections and doesn’t always follow speed limits. Tesla's less-sophisticated Autopilot system also was recalled to bolster its driver monitoring system.

Some experts don't think any system that relies solely on cameras like Tesla's can ever reach full autonomy.

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