Last year over the holidays, I attended a virtual wine tasting event that was put on by one of our partners. It was with a vineyard / winemaker in Spain and so it was evening for us and some ungodly hour for him.

At the end of the tasting -- which was exceptional, by the way -- I asked him what he thought about the Niagara region. Some of you may know that I love to support local Ontario wines. His response was hilarious and something along the lines of: "When we think of Niagara wines, we think of a part of the world that shouldn't produce wine but somehow does."

Ouch.

This was maybe the case before. But I think the region, vines, and industry have all matured. We also have some exceptional winemakers, some of which have come from the Old World because our startup-y wine region affords them far more creative freedom.

But you might also argue that things are changing because our climate is changing. The Financial Times recently published an interesting "big read" about how agricultural production and crop types are shifting around the world in the face of climate temperatures.

It turns out that wine grapes are a pretty good leading indicator. A canary in the coal mine if you will. Because climate matters a great deal if you're trying to make exceptional wines. And if you've been harvesting a particular thing at a certain time for the last 5 decades and you're now doing it several weeks earlier, it might be a sign that something is changing.

It also turns out that two countries, in particular, stand to disproportionately benefit from this shifting agricultural landscape: Canada and Russia. As temperatures change, a new agricultural frontier is going to be created. And it is expected that more than 50% of this land will be in these two countries. See image at the top of this post.

Of course, there's a flipside to this change. Countries on the other end of the spectrum with marginal growing climates and/or low production yields, could be severely impacted by higher temperatures. So perhaps it is a good idea to stay on top of what's happening in the world of wine. Might I recommend something from Niagara?

Image: FT

American Forests, which is a US non-profit conservation organization, publishes something that they call a Tree Equity Score. What it effectively does is map tree cover across US cities. You can explore what that looks like, here. The score considers things like tree canopy, population density, income, race, as well as many other factors, and then produces a single score from 0 to 100. A score of 100 means that a neighborhood has achieved "Tree Equity."

There is seemingly a lot that you can glean from this score. For one, American Forests have found that income and race tend to correlate with tree canopy. Lower income neighborhoods tend to have less of it and rich neighborhoods tend to have more of it. You can start to see what that looks like in the Instagram post embedded at the top of this post. If it isn't showing up, click here.

But the other thing that is clear from these images is that rich people tend to consume more space. The richer tree-canopied neighborhoods appear to be less dense. The lots are bigger. And there are instances where the homes look to be adjacent to some large contiguous green spaces. This, of course, is a natural market outcome.

The Tree Equity Score tries to correct for this in its methodology. If a neighborhood's population density is very low (less than 2,000 people per km2), then it gets a higher tree canopy adjustment factor. It should have more trees. Conversely, if a neighborhood's population density is high (over 8,000 people per km2), then it's acceptable for there to be less trees (lower adjustment factor).

That said, it would be interesting to see a direct comparison of two neighborhoods -- one rich and one poor -- that have the exact same population densities and overall built form. I think that would speak volumes about tree inequity. I am also very curious about the global relationship between density and household incomes.

If any of you have a good source, please share it in the comment section below.

This is an interesting article talking about the price of carbon and where it will need to go if we are to get to zero carbon emissions by 2050. The current price of carbon on the EU’s Emissions Trading System is around $59 per tonne. But according to the OECD, carbon will need to be closer to $150 per tonne by 2030 to keep the world on track with its sustainability goals. What this means is that if you emit carbon, it will get more expensive to do that.

The article also suggests that there is talk of a minimum price on carbon that would slowly increase over time. This would provide greater certainty to investors who are buying/trading carbon, while at the same time encouraging a broader push away from carbon emissions. This proposal has been backed by the Net-Zero Asset Owner Alliance, which is a group of companies that collectively represent about $6.6 trillion of assets under management.

I think it is clear that we are headed in this direction. But it is going to be an expensive transition. Take, for example, the case of new buildings. Many/most cities now have sustainability goals that similarly increase — become more stringent — over time. The thinking is that this gradual transition allows the development industry to incrementally adapt. Makes sense.

However, there are real challenges. Generally speaking, these new targets increase the cost of building. The result is a set of opposing forces. We want more sustainable buildings, but we also want more affordable housing. The problem is that the former often works against the latter, even though it is the right thing to do. And so it is not only about the industry catching up to new targets, it is also about the market catching up through higher rents and higher sale prices.

My view is that offsets and subsidies are important to rebalancing some of these forces. Because without them, it is likely that we are doing things that run counter to each other.