Climate Finance | September 19, 2022

New momentum and stubborn challenges as Climate Week kicks off (Call No. 44)

Amy Cortese

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ImpactAlpha Editor

Amy Cortese

ImpactAlpha, Sept. 19 – Investors, entrepreneurs, corporate executives and world leaders have descended on New York for Climate Week, the annual gathering alongside the U.N.’s General Assembly.

After a season of undeniable extreme-weather events, global energy insecurity, and clarion calls for climate justice, the week’s theme is “Getting it done.” The packed agenda will set up the key COP27 climate summit in Egypt in November. “There is no more time for delay,” Mike Peirce of Climate Group, which hosts the event, tells ImpactAlpha.

The U.S. Inflation Reduction Act, which will unleash $370 billion for climate action, is a “once-in-a-generation opportunity” to open trillion-dollar markets, BlocPower’s Donnel Baird said on ImpactAlpha’s Agents of Impact Call last week. 

Global spillover

The U.S.-focused IRA will have “knock-on effects in terms of diversified supply chains and lowering technology costs that are going to be great for emerging markets,” Jonathan Phillips of Duke University’s James E. Rogers Energy Access Project said on The Call. Phillips is working with Shell Foundation to map 30 investment pathways for climate adaptation and resilience, including solar irrigation and cold-storage to reduce post-harvest waste. Next up: robust ways to measure the adaptation benefits of such solutions and bring in private capital. “Can we get a better, more robust data environment so that you can put public money together with private money?” asked Phillips.

Adaptation and resilience

A new crop of funds is out to prove that investing in resilience can pay. Lightsmith Group is investing in water management, resilient food systems, agricultural analytics, catastrophe risk modeling, and other adaptation plays.

Impact venture capital firm Omnivore backs smallholder farmers in India to increase their resilience.

Paris-based Tikehau Capital is nearing a first close for its regenerative agriculture fund, which is targeting $1 billion (see, “AXA, Unilever and Tikehau Capital seed regenerative agriculture fund with €300 million”). “These kinds of vehicles could send the right market signals that we have not seen in the past,” Shell Foundation’s Ashish Kumar said on The Call. (Catch the video replay.)

Industrial policy

The IRA “changes everything,” write Ron Pernick and Clint Wilder of Clean Edge in a guest post on ImpactAlpha.

The Act is “the first true U.S. industrial policy that’s rooted firmly in the clean energy transition,” they write. U.S. and foreign companies, from Toyota and Honda to First Solar and Piedmont Lithium, have announced a slew of domestic electric vehicles and battery plants, “the first of many more to come.”

Clean Edge’s seven-point action plan to accelerate the clean-energy transition includes energy efficiency, global wind and solar, and storage to enable 100% renewable power 24/7. (Read, “Speeding the energy transition: A seven-point action plan,” by Ron Pernick and Clint Wilder.)