Published:
Feb 20, 2023
Author:
Sarah Parsons Wolter
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While the rest of the US economy might appear to be slowing down, the green energy sector is booming, with hundreds of billions of dollars pouring into the sector in the forms of tax abatements and other incentives. At the same time, World Bank president David Malpass has announced that he is leaving early from the post from pressures around his stance on climate change - he had previously refused to publicly acknowledge that human-driven climate change was happening.
Historically, the biggest and most impactful pushes for climate change regulation are financial in nature. The Inflation Reduction Act (IRA) is no different: since the passage of the policy last year, $90b has already been committed to new projects, according to Climate Power. It also seeks to make the US a more attractive location for renewables investments in general, even at the risk of feeling protectionist in nature towards other countries.
The US is also the largest shareholder at the World Bank and historically has appointed its president. Part of the organization’s priority includes organizing funds around natural catastrophes such as hurricanes, tornadoes and floods, which are becoming increasingly common in nature.
One thing is clear: climate change regulation is on every country’s agenda. Financial incentives and guidelines are the most direct and effective way to push forward impactful changes in corporate behavior and investment strategies, and we’d expect to see more of that in coming years. Onwards and upwards - and not just referring to the Chinese air balloons.
Portfolio News
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Squeaky Clean
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Select Financings
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