Decarbonization Done Right: Leveraging Unit Economics

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Hello EkoFam,

Ready to dive into the forefront of sustainability? We've got you covered! From leveraging unit economics for maximum impact to empowering the underserved with Biden's initiatives, there's plenty to explore.

• Decarbonization Done Right 🌱

• SSS 🌍

• Risk Management 💼

• Empowering the Underserved

• Venture Building ⚙️

• EkoHero 🦸‍♀️

Let's embark on this green journey together! 🌱🌍

Decarbonization Done Right: Using Unit Economics in Climate Investments 🌱

Unit economics are often considered one of the foundational building blocks of business, often used by VCs to compare potential investments.

Commonly featured during the decades-long SaaS boom (e.g. lifetime value and customer acquisition costs), climate tech investors are also developing new metrics for emerging climate solutions. Many have learned their lesson from Cleantech 1.0 – often ignoring unit economics and relying heavily on altruism for adoption. 

Ensuring that unit economics are viable are a key driver of ClimateDoor’s venture support, as we believe a solution must be at cost parity to maximize (financial and climate) impact through mass adoption.

Climate tech units require a mix of economic modeling with scientific and physical measurement (e.g., a techno-economic analysis).

Some potential categories for to develop and consider unit economics include: 

• Inputs - e.g. cost and availability feedstock supply (sometimes companies can be ‘paid’ on the inputs, e.g., compost-biogas) 

• Outputs - e.g. energy OpEx savings and energy return on energy invested 

• Time - e.g. the faster the inputs can be converted into outputs, the faster the payback period for an investor 

• Space - e.g. the output potential per unit of land/space required or potential to ‘scale up’ the solution (e.g., modularity) 

Investors need to focus on the wide-chain economics for any solution they are considering. And they must focus on those that are at least at cost parity with incumbent technologies to make it a no-brainer for adoption.

This is about stacking up financial wins side-by-side with decarbonization, creating a compelling incentive for widespread adoption by industries.

It’s the only way climate tech investments will pay off, provide real returns, and, therefore, have a long-lasting impact.

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Sustainability Sentiment Score (SSS)

We're seeing some mixed results making up the SSS this week. On April 10th, inflation data for March came in higher than anticipated. This hotter-than-expected report caused steep drops, especially in the American markets.

Our Growth Climate and Mature Climate markets both fell victim to the post-report panic and suffered losses after seeming to have recovered from last week's drops.

Carbon markets, on the other hand, have been doing well this week. April 8th saw Regulated Carbon markets to their highest in the last few weeks. The Voluntary Carbon markets also climbed, though, as usual, at a much more irregular rate.

💼Climate Risk Management: A Game-Changer in Market Valuations? 🌍

In a groundbreaking study, the University of Florida reveals how climate risk management influences market valuations. Here's a peek into the new era of accountability:

• Global Impact: Investors are shifting towards sustainable portfolios, prioritizing companies with robust climate risk management.

• Business Opportunities: Transparent climate risk strategies can boost market valuations, offering growth prospects for forward-thinking firms.

• Individual Actions: Individual investors hold the key to driving corporate change by investing in sustainability-focused companies.

The findings serve as a wake-up call for businesses worldwide, emphasizing the importance of proactive climate risk management for financial resilience and market relevance. Ready to ride the wave of change? 🚀

🌱 Biden's $20 Billion Clean Energy Initiative for Low-Income Communities

In a historic move, the Biden administration unveils a monumental $20 billion investment to fuel clean energy projects in low-income communities. This bold initiative not only signifies a shift towards environmental sustainability but also emphasizes social equity as a core principle.

🌍 Global Impact

This substantial investment transcends national boundaries, highlighting the importance of global environmental justice. By directing funds to underserved communities, the initiative addresses the disproportionate effects of climate change and sets an example for worldwide action. It sparks hope for collaborative efforts among nations to combat climate change and bridge socio-economic disparities.

💼 Business Opportunities

Entrepreneurs and investors are presented with a golden opportunity to drive innovation in the renewable energy sector. The influx of funds into clean energy projects creates a fertile ground for businesses, ranging from solar and wind energy to energy-efficient technologies. Moreover, it catalyzes advancements in energy storage and grid modernization, propelling the transition towards a resilient clean energy infrastructure.

👥 Individual Actions

At the grassroots level, individuals are encouraged to actively engage in the clean energy transition. Community participation and advocacy are vital in ensuring that the benefits of this initiative reach all segments of society. By investing in green technologies, supporting community solar projects, or advocating for sustainable policies, individuals can contribute to a more inclusive and sustainable future. Additionally, the initiative offers avenues for education and job training in the renewable energy sector, opening doors to new career opportunities.

🎉 Let's Power Up Together!

The Biden administration's $20 billion investment marks a pivotal moment in our journey towards a greener, fairer world. As we embrace this transformative initiative, let's seize the opportunity to drive positive change at every level.

Whether through business innovation, community engagement, or individual action, let's power up together and pave the way for a brighter, more sustainable future for all! 🌍🔋

Venture Building Note of the Week

Embark on a journey of mindful innovation this week.

In the rush to disrupt and transform, let's pause to reflect on the 'why' behind our ambitions.

Are we solving the right problems? Does our work align with our deepest values and the greater good?

This week, weave mindfulness into your decision-making process, encouraging your team to think deeply about the impact of their work.

Let's cultivate an environment where every project, no matter how small, is a step towards a more thoughtful, conscientious approach to innovation.

Here's to a week of purpose-driven progress, where mindful reflection guides our path to creating solutions that truly matter.

Together, we can build ventures that not only succeed but also inspire.

EkoHero 🦸‍♀️

Tzeporah Berman's environmental journey began in the midst of a logging blockade, leading to decades of impactful activism. 🌲 Arrests didn't deter her; they fueled her drive to create change. With strategic brilliance, she's navigated major campaigns and policy victories, from the Great Bear Rainforest Agreement to founding ForestEthics, now STAND.earth.

Her breakthrough idea? Phase out fossil fuel production through international agreements and corporate engagement, a mission that earned her a Climate Breakthrough Award in 2019. Bold initiatives followed, including the Fossil Fuel Non-Proliferation Treaty Initiative, shifting global climate policy discourse.

With Award funding, Tzeporah launched transformative projects, including a global fossil fuel registry and the SAFE Cities program at Stand.earth. As International Program Director, she continues to drive change, proving that passion and strategic vision can reshape our world. 🌍🌟

🔍 Curious about Tzeporah Berman's environmental journey? Uncover more by following this link! 🌱🌍

THOUGHTS ON TODAY’S ISSUE?

And that's a wrap for today, ekochampions!

Just like building with unit blocks, every small eco-friendly action contributes to the bigger picture of sustainability.

Whether it's reducing your carbon footprint or spreading awareness about environmental issues, your efforts matter.

Until next Thursday… 🌱💚

– Eko