An area of opportunity lies in reducing carbon emissions, meaning electrify everything and switch the source of electricity to renewables. India now has among the highest amount of renewables capacity being added yearly
Image: Sajjad Hussain / AFP
Here’s a provocative thought for you.
The climate economy today is where the internet economy was 20 years ago. And 20 years from now, the climate economy will be possibly bigger than the internet is now.
Let’s see the comparisons.
In 2001, the bloodbath of the ra-ra early years of the internet had left a lingering feeling of disquiet about how big the internet was going to be. Something similar happened in the cleantech boom and bust of the late 2010s. In 2001, roughly 3-5 million people worked on the internet and a similar number work in the climate economy today. And soon after, there was a resurgence of optimism and dollars invested in the internet. Something remarkably similar is happening in climate. In 2021, PwC estimates that 14 percent of all venture dollars worldwide went into climate companies. Bill Gates said that in climatetech, ‘there will be eight Teslas, 10 Teslas—only one of them is well-known today’. Larry Fink, Blackrock’s CEO, believes that “the next 1,000 unicorns will be businesses developing green hydrogen, green agriculture, green steel and green cement”.
Within the next two decades, just like the internet, climate change is going to upend industry after industry, and change their fundamental basis of competition. From energy to agriculture, from transportation to construction, from manufacturing to finance. That’s more than a third of the world’s GDP, if you’re counting. And as IFC estimates, solutions to climate change could create upwards of $20 trillion of economic value in emerging markets alone in the next 10 to 20 years. And just like the second order effects of the internet were hard to gauge back then (think: Netflix was disrupting Hollywood, not Blockbuster), climate change will be similarly transformational.
What kind of transformation, you ask? Imagine, within a decade, no internal combustion engines. No oil & gas majors. The end of industrial meat. Energy too cheap to meter. Reforestation of a trillion trees.
Climate is no longer your grandmother’s CSR. Instead, it is rapidly becoming one of the biggest wealth-creation opportunities of all times, and the time to jump in is now. Bonus: You end up saving the planet.
I see four broad areas of potential opportunity:
- Reducing carbon emissions—shorthand for “electrify everything and switch the source of electricity to renewables”.
- Drawing down existing carbon from the air—through low-tech means like reforestation or high-tech ones like Direct Air …….