Wednesday, November 4, 2015

Goldman Sachs a Clean Energy Leader

Goldman Sachs is going long on clean energy. On Monday November, 2, 2015 Goldman Sachs, one of the world's biggest banks, formally announced that it is investing $150 billion in clean energy finance.

The company has come a long way since 2010 when the SEC filed a lawsuit against the firm for securities fraud. They were implicated in the now infamous Collateralized Debt Obligation (CDO) subprime mortgage scandal that kicked off the great recession of 2008.

There are a number of good reasons why Goldman Sachs has joined a host of other blue chip companies that are getting on the clean energy bandwagon. The company was among those who took the American Business Act on Climate Pledge. This significant climate mitigation pledge was announced in July.

Companies like Citi and Berkshire Hathaway are onboard and recently nine companies added their names to the RE100 pledge to get all of their energy from renewables. This includes Johnson & Johnson, Nike, Procter & Gamble, Salesforce, Starbucks, Steelcase, Walmart.

Goldman Sachs is also part of the Climate Group that works with a coalition of companies, states, regions, cities and public figures to drive a clean revolution.

As they explain in the Climate Group bio, they pioneer initiatives and support programs that help solve crucial social and environmental issues. They claim to, "carefully the environmental consequences of its investments."

On climate change, the firm believes that a healthy global environment supports the growth of economies and communities. The firm is, "committed to leveraging its people, capital and ideas to develop and implement effective market-based solutions that help address critical environmental issues such as climate change." On a personal level, Goldman Sachs is committed to low carbon growth and energy efficiency. They have pledged to reduce their carbon emissions to zero by 2020.

In 2012 the firm committed to a $40 billion investment in clean energy technologies by 2025. The new $150 billion target represents an almost fourfold increase in their commitment to finance clean energy infrastructure around the world. The projects that it will be supporting including technologies like solar, wind, energy efficiency and power grid infrastructure.

As reported in Fortune, Goldman Sachs managing director and head of the environmental markets group, Kyung-Ah Park, said that the renewable energy sector has “reached an inflection point” with more renewable energy systems installed this year than conventional systems.

The firm will also finance clean energy in the developing world and help the development of carbon markets around the world.

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