Historic levels of support in the form of packages such as the US Inflation Reduction Act haven’t been enough to offset the fallout on capital-intensive green projects of much higher interest rates. The S&P Global Clean Energy Index is down almost 30% this year, compared with an almost 20% gain in the S&P 500 Index. The reality check follows a period of painful losses for green investors. But there has to be “a return on the money,” he added. Given an annual global need of somewhere between $5 trillion and $10 trillion to address the challenges posed by climate change, it’s obvious private capital will need to provide the lion’s share, Dalio said. The alliance said it’s focused on ensuring that capital flows to where it needs to go around the world. In its latest report, GFANZ said some progress has been made as financial institutions have started to take action. What moves the dial is being able to deploy the capital,” and the concern now is that “there aren’t enough bankable projects,” he said. “The private sector only does things that are commercial and create a commercial return: they are to preserve the capital of their customers, savers, pensioners and depositors.”Ĭhuka Umunna, head of EMEA ESG and green economy investment banking at JPMorgan, said the feeling is that “some people in our industry have been guilty of overreach in relation to what the role of the banking sector is in all of this.”Īnd Jason Channell, head of sustainable finance at Citi Global Insights, said that climate pledges alone are “not necessarily what moves the dial. “Let’s be clear,” she said during a COP28 panel. Shriti Vadera, chair of Prudential Plc, said no one should expect private capital to fill a political or policy void without the right incentives.
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