🧭 The latest in climate innovations and ESG trends in August 2024

Hey there 👋 

Thank you for joining me in the BIG Risk Navigator journey as we continue to uncover risks and opportunities in the dynamic world of sustainable innovation! 

The BIG Risk Navigator is your guide to navigating the complex landscape of fintech and sustainability, providing you with insights and case studies that empower your strategic decisions.

We're building a community of forward-thinking leaders committed to creating positive change. Thank you for being part of this journey!

Last week, I explored the cutting-edge launch of Clive™, the AI-powered claims adjuster transforming insurance, and delved into Deloitte's findings on ESG data challenges. 

Now, let's dive into the latest breakthroughs shaping the future of sustainable business.

• Bill Gates’ Climate VC Breakthrough Energy Ventures Raises $839M for New Fund: Breakthrough Energy Ventures (BEV), backed by Bill Gates, has secured the largest climate fund raised so far in 2024.

• €500 Million Green Loan for Renewable Projects in US, Australia, and Italy: Iberdrola, ICO, Sabadell and HSBC have signed a syndicated green loan for an amount of 500 million euros.

• ERM Reports Greenwashing Practices in United States: EU research project revealed that 53% environmental claims made regarding products and services are either ambiguous, deceptive, or unfounded.

• ISS ESG Launches Tool to Help Banks Estimate Portfolio Emissions to Meet Sustainability Reporting Requirements: ISS ESG introduced a new Industry Average Emission Intensity Data Set as part of the evolution of its suite of Climate Solutions.

• Salesforce Survey finds 81% of Sustainability Leaders Emphasize the need to Reduce AI’s Emissions Footprint: Salesforce reveals 4 in 10 sustainability professionals worry about AI’s potential negative impacts.

🎯 Bill Gates’ Climate VC Breakthrough Energy Ventures Raises $839M for New Fund, Sector’s Largest this Year

✅ Key Insights

• Breakthrough Energy Ventures raises $839M for BEV III, making it the largest climate fund of 2024.

• Limited partners (LPs) show strong support for climate funds, with nearly 5% of global LP capital commitments in early 2024.

• Breakthrough’s early investments, like Boston Metal and Redwood Materials, highlight its leading role in climate tech.

Founded in 2015 by Gates, Breakthrough Energy Ventures (BEV) was one of the pioneering VC funds focused exclusively on climate investments. BEV’s unique approach and Bill Gates’ extensive network have propelled it to the forefront of early-stage climate investing.

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🎯 €500 Million Green Loan for Renewable Projects in US, Australia, and Italy

✅ Key Insights

• €500M Green Loan: Iberdrola, ICO, Sabadell, and HSBC sign a €500M syndicated green loan to fund renewable projects in the US, Australia, and Italy.

• Cesce Coverage: The loan is covered by Cesce under Spain’s Green Investment Policy, ensuring political and commercial risk mitigation.

• Renewable Capacity: The projects will add 897 MW of renewable capacity, operational between 2025 and 2026.

Iberdrola and partners signed an agreement to receive a €500 million syndicated green loan which will be used to finance renewable wind and photovoltaic projects, as well as battery projects in the United States, Australia and Italy.

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🎯 ERM Reports Greenwashing Practices in United States

✅ Key Insights

• 68% of U.S. corporate leaders admit to greenwashing.

• Over half of environmental claims lack credibility.

• AI and human expertise can together tackle greenwashing.

According to a study by Environmental Resources Management (ERM), 68% of corporate leaders in the United States acknowledge their involvement in greenwashing practice. These findings underscore the importance of vigilance in assessing companies' environmental claims for investors and ESG raters.

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🎯 ISS ESG Launches Tool to Help Banks Estimate Portfolio Emissions to Meet Sustainability Reporting Requirements

✅ Key Insights

• With the new tool banks can estimate emissions for compliance with CSRD and EBA Pillar 3 ESG.

• Allows the emission estimates for non-listed companies and SMEs.

• Follows PCAF recommendations, offering global and regional data.

ISS ESG, the sustainable investment arm of ISS STOXX, has introduced a new tool designed to empower banks in accurately assessing the emissions associated with their loan portfolios. This tool is expected to aid financial institutions in meeting increasingly stringent sustainability reporting requirements and aligning their practices with global climate goals.

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🎯 Salesforce Survey finds 81% of Sustainability Leaders Emphasize the need to Reduce AI’s Emissions Footprint

✅ Key Insights

• 57% of sustainability professionals are optimistic about balancing AI’s benefits with its environmental impact.

• 58% believe AI’s benefits will outweigh its risks in addressing the climate crisis.

• 55% believe AI’s impact on global sustainability progress will be net positive.

• The top priority for sustainability teams is improving knowledge and skills related to AI and sustainability.

The urgency to balance AI’s rapid advancement with sustainability efforts is critical. AI-driven data center power usage is projected to double by 2026, potentially jeopardizing corporate carbon reduction goals. Google’s data centers alone account for up to 10% of global data center electricity consumption. According to Google's latest report, their emissions surged 48% since 2019.

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Transform Asset Performance Management with Predictive AI

OPINION PIECE: Timothy Holtan, Senior AI Solution Director, C3 AI

Early asset performance management (APM) solutions fell short of expectations due to their inability to deliver predictive analytics. However, the advent of AI-powered APM solutions has transformed the landscape by enabling accurate predictive maintenance, thereby reducing operational costs and enhancing overall efficiency for organizations in asset-intensive industries.

✅ Highlights 

• Organizations Are Plagued by the Cost and Functional Limitations of Legacy APM Solutions

• Three Major Asset Management Challenges 

• Requirements for New AI-Powered Asset Performance Solutions

• The Benefits of AI-Powered Asset Performance Solutions

• How Does C3 AI Provide AI-Powered Asset Performance Solutions?

Timothy explains how C3 AI Asset Performance Suite has improved overall equipment effectiveness (OEE) by up to 5% of manufacturing assets. The C3 AI Asset Performance Suite is a portfolio of AI applications that helps industrial organizations improve uptime, productivity, and profitability. The suite has three major pillars: asset reliability, process optimization, and energy efficiency.

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How Effective Are Carbon Credits in Corporate Net Zero? SBTi Speaks

The Science Based Targets initiative (SBTi), the leading authority on corporate climate goals, has released new research that suggests carbon credits may not be effective for offsetting value chain emissions. This marks a significant shift from earlier plans, which had proposed a broader role for carbon credits. 

✅ Highlights

• SBTi’s New Findings Challenge Carbon Credit Market

• SBTi’s Game Plan: Revising Corporate Net-Zero Standard

• A Carbon Credit Market Shake-Up: A Call for Rethinking Emissions Strategies

The SBTi’s review, based on various third-party studies, finds that many carbon credits fall short of delivering the intended environmental benefits. This revelation suggests that reliance on carbon credits might hinder decarbonization efforts and limit the flow of climate finance. The report’s findings could significantly impact the carbon offset market, which has been scrutinized for its effectiveness in delivering promised emissions reduction.

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