What's holding investors back from green projects? | Climate Conversations podcast

Climate Conversations: Ecosperity Week and the State of Climate Action

Key Concepts:

• Climate change action: Current status and challenges.
• Ecosperity Week: Annual green investment convening in Singapore.
• Climate investment trends: Declining private equity investment in climate-focused funds.
• Policy risk: Uncertainty in government regulations affecting investment decisions.
• Asia's race to 2030: The urgency of meeting climate targets.
• Climate resilience and adaptation: Building resilience to climate impacts, particularly in Asia.
• Coral bleaching: The severity and extent of global coral bleaching events.

1. Current Status of Climate Change Action:

• The podcast opens with a concerning assessment of climate change action, noting challenges such as:
  • World leaders with anti-climate agendas.
  • Slowing global trade.
  • Struggling renewables and carbon markets.
• The hosts express a sense of low engagement and concern among the general public regarding climate change.
• Despite the challenges, the podcast aims to explore areas of hope and progress.

2. Ecosperity Week Overview:

• Ecosperity Week is an annual event in Singapore that brings together government representatives, officials, and investors interested in green investment opportunities.
• The event serves as a platform for:
  • Exploring climate solutions.
  • Sharing best practices.
  • Consulting on ways to move forward with climate action.
• Leeling Tan attended Ecosperity Week seeking "climate therapy" and to gauge the perspectives of key stakeholders.

3. Climate Investment Trends and Challenges:

• A study by New Private Markets revealed a significant decline in capital raised by funds with a partial climate focus:
  • 2022: Over $42 billion USD.
  • 2023: $22 billion USD (47% decrease).
  • Last year: $17 billion USD (22% decrease).
• Dr. Steve Howard, Vice Chairman of Sustainability at Temasek, attributes the decline to:
  • Policy risk: Uncertainty and potential changes in government regulations that can impact investment returns.
    • Example: Regulations surrounding solar plant development.
  • Technology risk: Risks associated with investing in new technologies like green steel, green cement, or fusion energy.
• Despite the challenges, Dr. Howard emphasizes that many businesses and finance leaders remain committed to their long-term climate targets and investments.
• He notes that they may be less vocal about their efforts due to the uncertain political climate.

4. Asia's Race to 2030:

• The theme of Ecosperity Week was "All Systems Go in Asia's Race Towards 2030," highlighting the urgency of meeting climate targets.
• 2030 is a key deadline for governments and corporations to:
  • Transition to cleaner energy.
  • Account for and offset emissions.
  • Triple renewable power capacity.
• Dr. Howard remains optimistic, citing human ingenuity, investor interest, business engagement, and government support as driving forces.
• He believes that significant progress will be made in the coming years, with EVs and renewables dominating the energy system and advancements in storage and food systems.
• He states, "We overestimate what we can do in one year, but we underestimate what we can do in 10 years."
• The podcast highlights the need for investors to consider both planet-saving initiatives and their bottom line.

5. Climate Resilience and Adaptation in Asia:

• The podcast emphasizes the importance of building resilience and adaptation to climate impacts, particularly in Asia.
• India is presented as a case study due to its large size and diverse challenges.
• Dr. Arunabha Ghosh, CEO of the Council on Energy, Environment and Water (CEEW), proposes a three-part solution:
  1. Granular risk assessments: Understanding the specific impacts of climate change on the economy, people, and ecosystems at a district and sub-district level.
     • CEEW is developing a high-resolution climate resilience atlas.
  2. Investment in disaster resilience: Shifting from disaster management to proactive investment in climate-resilient infrastructure and nature-based solutions.
     • Risk mapping should translate into insurance coverage and long-term climate resilience investments.
  3. Building administrative capacity: Strengthening the capacity of local administrators and communities to respond to climate-related challenges.
• Dr. Ghosh emphasizes the importance of Asia learning from each other, as lessons developed in Asia are more relevant to the region's specific challenges.

6. Global Coral Bleaching Event:

• The podcast discusses the severity of the ongoing global coral bleaching event, which has affected 84% of the world's coral reef ecosystems between January 2023 and April of this year.
• This event is the most severe wave of ocean warming, resulting in significant coral loss across dozens of countries.
• The podcast notes that there are limited solutions beyond mitigating global warming.

7. Conclusion:

• The podcast concludes with a call to action, urging listeners to take on the "sprint towards 2030."
• Despite the challenges and setbacks, the hosts emphasize the importance of hope, ingenuity, and political will in addressing climate change.
• The discussion highlights the need for both mitigation and adaptation strategies, with a particular focus on Asia's role in driving climate action.