Solving the Climate Crisis: the Greatest Investment Opportunity of Our Time?

Greta Thunberg isn’t the only one with concerns about the way we’re dealing with climate issues.

At the end of 2019, in a pre-recorded BBC Radio 4 Interview, Mark Carney, the outgoing Chief of The Bank of England said that although the financial sector has begun to slow investment in fossil fuels, it’s happening too slowly.  Mr. Carney, who is commencing his new role as United Nations special envoy for climate action and finance said, “The concern is whether we will spend another decade doing worthy things, but not enough.” 

When Mr. Carney spoke with the Today Programme, he echoed previous sentiments, reminding leaders that unless firms ‘woke up’ to the climate crisis, plenty of today’s assets would become worthless.       

The question that holds more weight on its shoulders than one million or one billion dollars is, who is tackling the climate the right way, and are they doing enough?  In terms of investments, what innovation leaders should we be looking to and investing in to help both our pockets and planet earth?

Investment firms are paying attention

Investment firms like FullCycle boast a team that, “represents decades of high-impact investing, entrepreneurship, leadership, and climate science” and reiterates that they are not a philanthropy.  FullCycle asserts that they only invest in companies and project assets that produce market returns (or better) for their respective asset classes.

Founder and Managing Partner of FullCycle Ibrahim AlHusseini was an early investor in game changing companies including: Tesla Motors, Infenera, Bloom Energy, and Proteus Energy, as well as Aspiration Inc., WePower, Cadence Health, Thrive Market, and CleanChoice Energy. Full Cycle holds portfolios in companies like Synova Power, converting trash into usable electricity.  Synova Power has plants that process garbage to clear away glass and metal, and then utilize the left over plastic and bio waste to create gas to power their turbines and supply electricity.

Cleaner metals in deep sea mining?

Others look to lead the environmental charge by innovating new ways to tap into Mother Nature’s resources. DeepGreen’s purpose is to provide the world with cleaner metals leading the way towards a sustainable future with less environmental impact by sourcing needed battery metals from the deep ocean. 

While there are three types of metal deposits available in the deep ocean, DeepGreen is focused on only one: polymetallic nodules.  DeepGreen reports, “These are solid deposits of high-grade manganese, nickel, copper and cobalt, resting in clusters on the ocean floor on top of loose sediment, 4-6km deep in the middle of the Pacific Ocean.

DeepGreen is exploring a small patch making up 0.34% of the ocean floor, in an area called the Clarion-Clipperton Zone (CCZ) between Hawaii and Mexico.”  In June 2019, DeepGreen and Allseas announced a partnership via press release to harvest deep sea materials to meet the demand for electric vehicles, with Allseas contributing, “world-class offshore engineering resources and cash investment to the partnership.”  

Is there a risk?

While investors are excited about these initiatives, environmental activists are wary of companies like DeepGreen, who publicize their interest in the circular economy yet are mining resources from the ocean.  Greenpeace said in a report, “Deep sea mining could cause severe and potentially irreversible environmental harm both at the mine sites and throughout broader ocean areas. Opening up a new industrial frontier in the largest ecosystem on Earth and undermining an important carbon sink carries significant environmental risks … Deep sea mining could even make climate change worse.”

When it comes to investing and turning a profit on the climate crisis it could be a case of one step forward, two steps back.  Do your research and tread lightly.

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