Good morning. A scoop to start: The EU could bar imports of coffee from a number of countries within weeks unless Brussels delays a ban on products from deforested areas, commodity companies and governments have warned.

Today, the head of the International Energy Agency tells our energy correspondent that Europe isn’t doing enough to protect Ukraine’s power infrastructure, and our competition correspondent reveals a demand from 20 EU capitals for the European Commission to cut more red tape than it has already promised.

Have a great weekend.

Cold comfort

The head of the IEA has accused Europe of being too reticent in its support for Ukraine, calling for more generators and repair equipment for the war-torn country ahead of a difficult winter, writes Alice Hancock.

Context: Ukraine has suffered heavy attacks on its energy infrastructure by Russia, particularly in late August in retaliation for its incursion into Russia’s Kursk region. Half of all Ukraine’s energy infrastructure has been destroyed, roughly equivalent to the capacity of Latvia, Lithuania and Estonia.

In a report published yesterday, the IEA said Ukraine’s electricity deficit this winter could reach as much as 6GW, around a third of anticipated peak demand. The power shortfall this summer was 2.5GW when Kyiv was already enduring long blackouts.

“It’s time for everybody to understand that this winter could be consequential in Ukraine,” Fatih Birol, director-general of the IEA, told the FT. “It is the most pressing energy security issue today in the world.”

A lack of energy supplies meant a knock-on impact on the operation of hospitals, schools, water supplies and other “major implications”, Birol added.

European Commission president Ursula von der Leyen will meet Ukrainian President Volodymyr Zelenskyy in Kyiv today to discuss the situation. They will also talk about where to direct €100mn the EU has given Ukraine for repairs and renewable energy, which came from the profits from immobilised Russian assets in the EU.

The EU will also provide €60mn in humanitarian aid for shelters and heaters. Average winter temperatures in Ukraine vary between -4.8C and 2C, according to World Bank figures.

Birol said there were “major shortages” of many crucial parts, including transformers, grid equipment and diesel generators. He said Europe had been too “conservative” in sending electricity to Ukraine and could step up exports without jeopardising European supply.

European consumers could help by cutting their own electricity demand, allowing more power to go to their eastern neighbour. This would be a “very decent way of showing solidarity”, Birol said.

Ukraine should have enough gas to see it through early winter, but the IEA said that once current contracts expire at the end of the year, there could be a need to increase west-to-east gas flows to Ukraine from central and eastern European neighbours.

Chart du jour: Rising tide

The Alternative for Germany looks set to win another state election in Brandenburg on Sunday, just weeks after the far-right party won its first regional poll in Germany’s postwar history. But the Social Democrats are closing in.

Cut it

If Europe wants to be globally competitive, it needs to go further than what Brussels plans to boost the single market, says a paper co-authored by 20 member states, including the Netherlands and Germany, writes Javier Espinoza.

Context: Two recent landmark reports — by former Italian leaders Mario Draghi and Enrico Letta — spelt out the stark risks of failing to reform the single market. They highlighted the need to reduce regulatory pressure on companies and to make it easier for businesses to access funding in order for the bloc to compete with the US and China.

Ursula von der Leyen’s second term at the head of the European Commission had to “continue to cut red tape . . . going beyond the announced 25 per cent reduction of reporting requirements”, the joint document states, referring to an existing promise.

She should also back “specific digital tools” that would allow companies to focus less on regulatory reporting.

The signatories, which also include Luxembourg and the Czech Republic, called on the commission to provide “an enabling and transparent regulatory environment” — technical language for forcing capitals to align their rules.

Lex Delles, Luxembourg’s economy minister, pointed to persistent barriers within the single market where “retailers cannot pick their suppliers in the country of their choice because of territorial supply constraints imposed by wholesalers”.

He added: “By prohibiting such practices, we would show businesses and consumers that the EU can deliver concrete results for them.”

What to watch today

1. European Commission president Ursula von der Leyen travels to Kyiv.

Now read these

BY James Halpin, Foreign News Reporter

ISRAEL’S pager plot could be inspired by a spy film and the country is goading Hezbollah into starting a war, an ex-Mossad agent says.

Nearly 3,000 people were injured on Tuesday and 12 were killed in the sabotage attack leaving Lebanon in chaos and hospitals full of bloodied and injured.

Avner Avraham claims Israel is directly challenging Hezbollah to start a war in retaliation, so it can then invade Lebanon and wipe them out.

Avraham says the chess move attack was Israel saying: “Don’t mess with us”.

He said: “The attack on Tuesday was so strong and wide if they [Hezbollah] do start a limited war, they will lose immediately.  

“In the north, we have to start a limited war and we prefer that Hezbollah would make the first mistake.

“The response would be a huge damage to Lebanon, it would go 100 years back.”

But, the 28-year spy veteran says Hezbollah has been left weak with so many people injured and Lebanon plunged into chaos.

“Now they don’t have a different kind of communication system, all their hospitals are full with injured people, this is the best time to attack them.”

Avraham said he believed Israel needed to attack Lebanon and create a “dead zone” inside the country where nobody lived.

That buffer would provide safety for the Israelis living in the north of the country – tens of thousands of whom have been displaced since fighting began last year.

“To bring back the families to the north, you cannot bring them to the world without destroying and pushing all the Hezbollah from the border.”

Avraham also said it is possible that the attack could have been inspired by gadgets used in spy films, something he did as an agent.

“Sometimes we use examples ideas from James Bond films, we took ideas, I can tell you this for sure.

He said: “No one could write the script for Tuesday. This is the real example of thinking outside the box… All the world saw what happened Tuesday, this is the money time.

“If Mossad is doing something and wants to declare it, they will declare it… In all cases they just do it and disappear.

“That’s the whole idea, you don’t know who is responsible for this, you don’t have any idea.”

This is an audio transcript of the FT News Briefing podcast episode: ‘Europe’s battery darling runs out of juice’

Sonja Hutson
Good morning from the Financial Times. Today is Friday, September 20th and this is your FT News Briefing. The markets are saying let’s party like it’s 2019. Meanwhile, Swedish battery maker Northvolt is entering its austerity era. Plus, people can get obsessed with their frequent flyer status. So when some airlines announced stricter rules, the gloves really came off.

Brooke Masters
And now US regulators are asking, is this a bait and switch and is it illegal?

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Sonja Hutson
I’m Sonja Hutson and here’s the news you need to start your day.

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Looks like Wall Street is going to be putting some champagne on ice. The S&P 500 closed at an all-time high yesterday. Investors bet that the Federal Reserve’s mega half-point rate cut is going to steer the economy into a soft landing. In other words, dodge a recession. Big Tech stocks at the top of the index led the rally, and the tech-dominated Nasdaq Composite was up 2.5 per cent yesterday. It’s a sector that really loves low rates because when money’s cheaper, debt feels lighter and riskier, assets start to look a little less scary. And it wasn’t just a party in the USA. European and Japanese indices were also up by a percentage point or two.

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A Swedish battery company has been a symbol of Europe’s fight against US and Chinese dominance in electric vehicles. But Northvolt is now struggling to scale up its operations and stay afloat. I’m joined now by the FT’s Richard Milne to discuss what this could mean for Europe’s auto industry. Hi, Richard.

Richard Milne
Yeah, hi there.

Sonja Hutson
So first off, why was Northvolt this kind of beacon of hope for Europe’s green energy ambitions?

Richard Milne
Yeah. So it was founded in 2017 by two former Tesla executives and then very quickly got the likes of Volkswagen, Goldman Sachs, BMW, Siemens, Ikea, all sorts of people on board to shareholders you know created a lot of optimism. And they went pretty quickly. They opened their gigafactory just below the Arctic Circle in northern Sweden at the end of 2021, producing the first battery. And it raised more money than any other privately held start-up in Europe. It’s raised more than $15bn, but since then, not a lot has gone right.

Sonja Hutson
Yeah. And what kind of problems is Northvolt facing?

Richard Milne
At its most basic, it just isn’t producing enough batteries. Battery making is just incredibly complex. One expert said it was like getting a million ballet dancers and everything has to go right. And it just has struggled to make its production lines work at the right speed, the right quality at the right cost levels. So it’s just massively behind schedule. It’s burning through a lot of cash. And at the same time, it’s up against these Asian competitors, particularly CATL and BYD of China, that are able to produce batteries extremely cheaply.

Sonja Hutson
And what’s the company doing to try to overcome those challenges?

Richard Milne
So the first thing it’s doing really is scaling back its ambitions. At one stage it was going to try and build so four gigafactories at the same time. It stopped or paused a lot of that and it really focusing just on this gigafactory in northern Sweden first. It realises that that is what it’s got to get right. But basically, if investors don’t give it more capital fairly soon, then it’s going to be in trouble. And the backdrop here is that in Europe, the demand for electric vehicles has been less than expected. This, in some ways may help given that it’s not making very much of them, but it also is giving investors sort of pause for thought. You know, is this green industry sector as hot as we thought it was?

Sonja Hutson
Hmmm. Now if Northvolt can’t get its act together, what would that mean for Europe?

Richard Milne
So this is really the big question. I mean, the car industry’s hugely important in Europe, and we’re in this transition to electric vehicles that are going to be dependent on batteries. If Northvolt doesn’t succeed and other European start-ups also don’t succeed, then basically you’re giving that part of your supply chain to Asian players. And that leaves a lot in the car industry worried because you want to have a close relationship with your battery maker. You probably want to tailor the batteries to your cars rather than to your rivals. So this is sounding big alarms in Europe.

Sonja Hutson
Richard Milne is the FT’s Nordic and Baltic correspondent. Thanks, Richard.

Richard Milne
Thanks so much.

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Sonja Hutson
Another day, another central bank meeting. The Bank of England said yesterday that it’s holding interest rates at 5 per cent for now, which isn’t a surprise. A majority of analysts predicted that it would keep things steady. That’s because inflation did not change in August and the BOE already cut borrowing costs by a quarter point last month. But future rate cuts are still on the table. The bank said it would take a gradual approach to loosening policy so long as there is no major changes in the economy. So most people assume that means the next rate cut is likely to come in November.

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There is no better feeling than booking a vacation. Well, except for maybe when you get that free business class upgrade because you have status. Frequent flyers love collecting points from their loyalty programs. But over the past couple of years, airlines have started making it even harder to maintain that status. And customers are not letting this fly. Here to explain more is the FT’s Brooke Masters. Hi, Brooke.

Brooke Masters
Hi.

Sonja Hutson
So for the uninitiated, how exactly do these airline loyalty programs work?

Brooke Masters
The basic way is you get a certain number of points for flying a certain number of miles, and then you can use those points to buy upgrades or buy seats. And as you hit certain levels of points, you get a status. For example, I am this year a gold status member on Delta.

Sonja Hutson
Gold? You?

Brooke Masters
My husband is a diamond, which is much better. My husband’s diamond status means basically if he flies business class and there’s a free seat in first class, they automatically upgrade him and you used to get into lounges. Now it’s a lot harder to get in lounges.

Sonja Hutson
Well, I hope you achieve diamond status one day. And just how profitable are these programs for the airlines?

Brooke Masters
These days they are absolute cash cows. That’s because they’ve figured out a new trick instead of just giving you points when you fly. They now cut deals with credit card companies where the credit card companies buy the points from the airlines and offer them to their customers for charging on the credit card. The airlines and the credit card companies also offer co-branded credit cards, which give fees to the airlines, as well as to the credit card companies. As a result, IAG, which is the parent of British Airways and Iberia, actually makes more money from its credit card program than it does from flying any of its airlines.

Sonja Hutson
So why are some customers annoyed with these programs right now?

Brooke Masters
There’s been a problem since Covid with too many people with too many points, because if you imagine people built up their points during Covid, they now want to fly. And so there was just too many people trying to use too few benefits, and it became very unpleasant. So the airlines have basically changed the rules, saying, we know we told you a credit card would get you lounge access. Actually, not so much. You know, it’s better for all of us. We’re trying to build loyalty. And now US regulators are asking, is this a bait and switch and is it illegal?

Sonja Hutson
And so if customers get so annoyed that they start to ditch these programs, where does that leave the airlines, especially because these programs are so, so profitable?

Brooke Masters
It will be tough for their bottom lines, I mean, because this is absolutely an important part of their growth plans and their profit programs. American Airlines got itself into big trouble a couple of months ago when it tried to say that if you booked your corporate flights, unless you booked them directly with American or through a couple of preferred travel partners, you wouldn’t get points at all. And people stopped flying. I mean, it showed up in their bottom line. They had to reverse the policy. The airlines do run the risk that they may choose not to fly them if the frequent flyer program is too bad.

Sonja Hutson
OK. So people are obviously heavily invested in these programs. But why is that? Like, what is it about them that gets everyone so riled up?

Brooke Masters
When Delta changed its rules the travel boards lit up and one of the best comments was somebody who referred to the alterations as a stinking, odorous sack of shites. There is this emotional feeling that when the program works, you love them. But, you know, every time I walk by the lounge and realise I can’t get in, it makes me really angry. And that’s what it’s about. It’s a game. People are absolutely emotionally attached to their programs. One of the consultants I talked to said you should always keep in mind people will pay anything to get something for free.

Sonja Hutson
Brooke Masters is the FT’s US financial editor. Thanks, Brooke.

Brooke Masters
Always a pleasure.

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Sonja Hutson
You can read more on all these stories for free when you click the links in our show notes. This has been your daily FT News Briefing. Check back next week for the latest business news. The FT News Briefing is produced by Niamh Rowe, Fiona Symon, Marc Filippino, Kasia Broussalian and me, Sonja Hutson. Our engineer is Monica Lopez. We had help this week from Michela Tindera, Mischa Frankl-Duval, Sam Giovinco, David Da Silva, Michael Lello, Peter Barber, Gavin Kallmann and Persis Love. Our executive producer is Topher Forhecz. Cheryl Brumley is the FT’s global head of audio and our theme song is by Metaphor Music.

NEW YORK (AP) — All of 23andMe’s independent directors resigned from its board this week, a rare move that marks the latest challenge for the genetic-testing company.

The resignations follow drawn-out negotiations with 23andMe CEO and co-founder Anne Wojcicki, who wants to take the company private. In a Tuesday letter addressed to Wojcicki, the seven directors said they had yet to receive a “a fully financed, fully diligenced, actionable proposal that is in the best interests of the non-affiliated shareholders” from the chief executive after months of efforts.

The directors said they would be resigning effective immediately — arguing that, while they still believed in 23andMe’s mission, their departures were for the best due to Wojcicki’s concentrated voting power and a “clear” difference of opinion on the company’s future.

Wojcicki later responded to the resignations in a memo to employees, published in a securities filing, saying she was “surprised and disappointed” by the directors’ decision. Still, she maintained that taking 23andMe private and “outside of the short term pressures of the public markets” would be best for the company long term.

Wojcicki added that 23andMe would immediately be identifying independent directors to join the board. Wojcicki, who holds 49% of the voting power at 23andMe, was the only remaining board member listed on the company’s website as of Thursday. A spokesperson had no further updates to share when reached by The Associated Press.

23andMe, which went public in 2021, has struggled to find a profitable business model since. The company reported a net loss of $667 million for its last fiscal year, more than double the loss of $312 million for the year prior.

Shares for 23andMe have also plummeted — with the company’s stock closing at 33 cents Thursday, down more than 97% since its 2021 stock market debut, according to FactSet.

Wojcicki announced her intention to take 23andMe private, by way of acquiring all outstanding shares that she doesn’t own, in April. Wojcicki also said that she wished to maintain control of the company and was not willing to support alternative transactions from other bidders. She submitted a proposal in late July, but the board’s evaluating committee found it to be wanting.

Beyond the resignations, 23andMe has made other a handful of other headlines in recent months — particularly around privacy concerns. Last week, 23andMe agreed to pay $30 million in cash to settle a class-action lawsuit accusing the company of failing to protect customers whose personal information was exposed in a 2023 data breach.

23andMe has shared preliminary support of the settlement, which is set to be heard by a judge for approval next month. In a statement, a spokesperson said that the company looked forward to finalizing the agreement, which it believe is “in the best interest of 23andMe customers.” The $30 million payment would settle all U.S. claims, the spokesperson added, and $25 million of it is expected to be covered by insurance coverage.