Climate change is real.The world has finally come together and acknowledged that we need to preserve our planet. Following the United Nations Paris Climate Change Conference in November last year, a historic meeting took place a week ago at the United Nations Headquarters in New York City, where 155 countries committed to signing the Paris Agreement on Climate Change. The countries pledged to work towards limiting global warming.
The corporate sector is taking a lead in tackling climate change. Companies such as Apple and Ikea, among many others, are making tremendous investments in renewable energy in order to power their operations in an environmentally responsible way. For example, Apple currently powers 93 percent of its facilities worldwide on renewable energy, while the facilities in the United States, China, and Australia are powered 100 percent on renewable energy. As the company grows, its carbon emissions have significantly lowered over the years, and the company’s goal is to power 100 percent on renewable energy. Ikea is also investing in renewable energy, setting a goal to operate with 100 percent renewable energy by 2020.
Research centers are investing heavily in research and development of new technologies to generate power from natural resources. From driving electrical carbon free emission cars, to grilling on a solar barbeque in the backyard, new technologies are changing the way we look at the future. Aside from the traditional ways of generating renewable energy like wind, solar, and hydro, today we can generate power from many different sources such as biomass or inserting turbines into municipal water pipes.
The interest and demand for generating renewable energy is growing. Washington, as the center of the major multilateral financial institutions such as the World Bank’s International Finance Corporation (IFC), the Inter-American Development Bank (IADB), and the Overseas Private Investment Corporation (OPIC), offers many financing opportunities for investors seeking financing.
Blue Star Strategies conducted an informal study on renewable energy financing. The study concluded that financing from international institutions is very attractive but also undiscovered by many entrepreneurs and investors. Financing is available for many developing countries throughout the Americas, Africa, Europe and Asia. The IFC, IADB, and OPIC offer lower interest rates, longer terms, and provide political risk insurance if necessary. These institutions also offer political support and access, unlike traditional commercial banks. Some of the international institutions provide additional financing for areas especially affected by climate change like coastal regions that are prone to flooding or abnormal weather changes. With appropriate guidance during the process, the closure of financing can be done as quickly as with a commercial bank.
With the developed nations leading on renewable energy investments, the numerous financing opportunities available for renewable energy projects in developing nations, and world leaders taking an initiative to combat climate change, an optimistic view, that humankind can save the planet from the worst effects of rising temperatures is justified. World leaders have never come so close to solving the issue. This is a historic opportunity that should not be wasted. Hopefully, every signatory will take actions and tackle climate change because the signed Agreement is worthless unless serious measures are taken to reduce carbon emissions.