Green Greed
Among companies who insure us against natural disasters, there's no debate about whether climate change is real. The truth is in the bottom line (just see Radiolab’s latest episode, “The Weather Report”). Instead, they’re discussing how to adjust to this reality so they can keep making money.
Meanwhile, state and local governments have been slower to get on board.
Part of it may be denial. Politicians lead governments, and if there’s one thing politicians don’t like to do, it’s sharing bad news: “this is a flood zone, your home is losing value,” or “don’t buy that lot, it burns down every year.” Fewer, less valuable homes mean lower tax revenue anyway.
It’s also been hard to shake this belief that green policies are expensive, complicated, and that they’ll stunt economic growth. And some of that is true. Green policies require cooperation and voters’ buy-in — persuasion is hard. Plus, one of the effects of green policies is that they cause high-polluting industries to lose out, as well as companies that are less productive to begin with, according to a 2021 OECD report.
Thing is, money and jobs don’t disappear: they just go to cleaner, more productive companies. And with the right incentives, consumers follow suit: Bloomberg reported last month that 87 countries have hit the “tipping point” of five percent adoption of clean energy, implying that people will now adopt it more quickly.
But governments may be catching on as they realize they can’t keep ignoring climate. “When it comes to protecting physical risk, we’ve seen a big acceleration in the last 20 to 24 months,” says Clay Dumas, General Partner at Lowercarbon Capital, a multi-billion venture capital firm focused on — yes — cutting CO2 emissions, capturing it, and mitigating climate risk.
Lowercarbon has been sought out by large corporations looking to improve their bottom line with green tech, but also, recently, by officials in some U.S. states. “It’s happening with government as a buyer of product, not just as a maker of policy,” Dumas adds. Could it be because of the hundreds of millions of dollars being sent their way by the Inflation Reduction Act? Regardless, the math is simple: growing demand means tech can scale up and costs can keep falling.
Not just in the U.S., either. Dumas tells me that “rooftop solar makes even more economic sense in Mumbai” than it does in California. In Brazil, he says they’re looking for a fix to landfill waste, not just because of the methane it emits, but because localities are running out of space.
“National security, economic security, government spending, government policy, corporate and personal behavior are all pointing in the same direction,” Dumas says. “In the U.S., but also Europe, in South Korea, Japan, São Paulo, Mumbai, Nairobi… That’s how we get the conviction that this transition is inevitable.”
Inevitable. How’s that, for hope?
Check out the list of companies supported by Lowercarbon — the tagline at the top of the page says it all. Economic research has shown that green policies can boost economic growth. Listen to “ The Weather Report,” by Simon Adler and Annie McEwen.