Be part of the re-generation
COP26 came and went — and how you feel about what the international climate summit achieved depends on your expectations. While there were some signs of progress, if you were hoping for broad, sweeping action limiting the rise in global temperatures to 1.5 degrees Celsius, you probably feel that the commitments made there won’t add up. For me, the most important revelation in Glasgow was that, even as thousands of protestors took to the streets in Dublin to demand bold action, along with demonstrators around the globe, most decision-makers still don’t see the political benefit.
As an investor focused on driving innovation, leadership, and significant private sector investment in climate-focused companies and innovations, I’ve spent a lot of time thinking about climate in terms of solving a technology problem. But thinking about the science behind climate often means we overlook the investment and economic aspects of climate action—and the benefits to communities.
To build a more effective movement for change, it’s important for innovators and funders to make the benefits of climate action more visible to communities and policymakers alike. And they can start by taking a page from the impact investing world.
Start With Community Impact
Many of the most successful, impact-oriented investors look at big problems at the community level. Instead of funding big national groups, they invest in local capacity. Consider the business model of Goodr, which was started when its founder, Jasmine Crowe, realized there was a simple way to reduce food waste in Atlanta and feed people who were hungry. Her secret? She did it with a hyperlocal focus — widening the aperture to see beyond hunger writ large to consider the people and places her solution would impact.
Companies like Solstice Community Solar in Cambridge, Massachusetts, take a similar approach to multiple markets — in its case, recognizing that many localities struggle with access to clean energy. By focusing customer qualification on utility-bill history rather than credit scores, Solstice created a model that could potentially enable thousands of low-to-moderate-income households to convert from fossil fuels to solar. When you start with the community need, you can create a different kind of energy and momentum.
When you start with the community need, you can create a different kind of energy and momentum.
Make Mass Adoption the First Phase of Success, Not the Last
In clean tech, the usual model is “Worry about cost later — start by selling to companies and consumers that can afford it.” But that model doesn’t work when you’re urgently trying to change consumer behavior, or for an issue like the climate crisis where emissions reductions today have an impact far beyond tomorrow.
Climate activists have wracked their brains thinking of ways homeowners could be persuaded to replace their beloved gas stoves and heat. Making geothermal heating and cooling cost effective right off the bat can help. That’s what Dandelion is doing. By leveraging state rebates and energy efficiency mandates it offers financial incentives that allow residential customers to install heat pumps that typically cost about $30,000 with no money down — and for as low as $150 per month — potentially reducing heating and AC bills by as much as $1,000 per year. Brooklyn’s BlocPower targets a different mass market: rental housing and landlords looking to increase building profitability with a more efficient heating and cooling system. These are just two examples of how, by focusing on the consumer at the outset instead of waiting until the solution becomes cost effective, a whole new set of climate-positive outcomes becomes possible.
Put People to Work Greening Community Infrastructure
Impact investors have developed great models bringing together municipal governments, local development banks and community banks to be responsive to local needs such as housing. Perhaps the surest way to help policymakers understand how climate action can benefit their communities is to green their infrastructure, a cornerstone of President Biden’s Build Back Better plan. Consider that, at a time when every major auto manufacturer has announced they will be dramatically shifting to electric vehicles, most by the middle of the next decade, one in three U.S. housing units does not have a garage. it’s estimated that 50% of people don’t have a permanent parking space to charge their cars. Climate investors could provide financing to convert parking infrastructure for daytime charging as well as financing solutions that capitalize on when the sun is shining, wind is blowing, and there is extra energy on the grid.
The most visible benefit of all? Jobs, jobs, jobs. Millions of them.
The most visible benefit of all? Jobs, jobs, jobs. Millions of them. We certainly need to figure out how to help the coal workers who will lose their jobs as we transition away from fossil fuels (about 12,000 annually for the next nine years). However, Rewiring America estimates that 25 million good-paying American jobs would be created over the next 15 years through decarbonization — jobs building charging stations, installing solar, weatherizing homes and buildings, and plugging wells and pipes for methane abatement. A number like that is hard to ignore and will impact every community in America, including coal country.
As the old saying goes, seeing is believing. Once people see for themselves the benefit of climate action, not just to their children’s future but to their own, policymakers and regulators will too. It’s time to take a page out of the impact investor’s handbook. Innovators and investors can put people to work now and make an unmistakable and very visible impact — and play an important part in saving the planet.
Regina "Gina" Kline
Founder & Managing Partner, Enable Ventures
October 27 - 12:00 PM EST
Founder & CEO, Acumen
November 3 - 12:00 PM EST
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