Janice Hall and Jigar Shah,
July 03, 2013
ASPEN, COLORADO Jigar Shah will be speaking again for the 4th time at this year's 10TH Anniversary Summit taking place August 15-18 In Aspen Colorado at the at the LEED certified Doerr-Hosier Building at the Aspen Meadow, home of the world-renowned Aspen Institute. He is the CEO of Jigar Shah Consulting, partner at Inerjys, and a board member of the Carbon War Room. Many have been still cautiously optimistic about sustainability, renewable energy and climate change solutions, while others seem to think these things will be the utter undoing our entire economic structure. Mr. Shaw has practically been shouting from the rooftops for several years now about the enormous potential these technologies have for not only jobs but "the largest wealth creation opportunity of our time". Now that President Obama has addressed and shed positive light on many of these issues in his speech of June 25th, Mr. Shaw hopes that people will start paying attention.To that end, he has written a response to the President that showcases his excitement, hope and inspiration, while not shying away from challenges. He thinks this is particularly appropriate as the US celebrates 4th of July, 2013.."This is a new step for the United States in independence from the status quo." states Shah.
"Our inspiration is not to just fix climate change, it is to ignite the next economy by meeting our energy needs using climate change solutions. Climate change is a trillion dollar opportunity masquerading a crisis." JIgar Shah
"With a 20% shift in our annual infrastructure spending from 20th century technology to 21st century technology we can drive a new global $10 trillion economy by 2020.
That was an undercurrent in a powerful speech President Obama delivered last week, demanding EPA set new standards for climate change to reverse its effect on our health and the environment. That bold action will help set goals to meet the desire of many to clean the environment. The president also noted: “A low carbon clean energy economy could be an engine for growth for years to come,” asserting that deploying American innovation by using our natural resources more effectively help boost the economy.
As impressive as the speech was, the president passed on the opportunity to focus on how the United States will compete with Germany and Japan as the largest climate-based wealth creators. One way would be to be prescriptive on how the federal government, the largest energy user in the world, could lead the way in leveraging climate change into economic growth.
He did not say, for example, “to lead the way I have directed the vice president to hold weekly meetings to make sure that my executive orders and directives are implemented to their fullest extent. From our goal of 20% renewable energy by 2020 to spending the $80B in super ESPC money we have to buy next generation vehicles. The federal government will lead the way and not leave the burden of scale to the private sector alone.”
Government must take the lead
The president has a golden opportunity to unlock the largest wealth creation opportunity of our time. He said solutions resulting in clean water and clean air regulation would be a good thing for business. Being good is not the same as asserting American exceptionalism by unleashing the power of American entrepreneurs, investors, and corporations onto the world stage to unlock a climate change economic revolution.
The president gave a bold speech, but what we need is recognition of the important role of government to deploy solutions. Here are the facts:
Yet, the progress in the 20th century and the spread of information in the 21st century, assures there is hope. We have the technology, mostly American, necessary to meet the carbon emission reduction targets of 2020. As noted, the investment needed to bring about this change globally is $10 trillion by 2020 – just a 20% shift in our global annual infrastructure spending from 20th century technology to 21st century technology.
And, we have sound economic incentives. Since 1999, oil prices are up 5X around $100/barrel, coal prices are up 5X to $100/ton. Plus, coal power plants have been a major cause of water shortages making our current crop of climate change and resource solutions the largest wealth creation opportunity on the planet. These clean energy solutions are much cheaper and represent a “leapfrog” technology in the emerging markets. Big Data solutions unlocked by American ingenuity can finally make elusive energy efficiency opportunities a reality – in a very short period of time.
Consider the entrepreneurs
The challenge is that while the technology exists we still don’t have the business model and financial innovation necessary to attract the $10 trillion by 2020. The president can change that. How? By thinking beyond just the EPA, and stop limiting thinking about how to recycle 20th century solutions like Fannie Mae and come up with 21st century solutions like crowdfunding. Crowdfunding, for example, allows investors to band together to quickly fund low-risk stable clean energyinfrastructure projects, a better investment than settling for 3% annuity payments for the next 30 years of their life.
President Obama made clear that he believes in our entrepreneurs, investors, and corporations who bringing climate change solutions to market. What he did not do is inspire thousands more to join them to unleash a climate wealth economy. These folks are all motivated to do well by doing good.
Our inspiration is not to just fix climate change, it is to ignite the next economy by meeting our energy needs using climate change solutions. Climate change is a trillion dollar opportunity masquerading a crisis. The next step for the president is to jump-start this next economy with the federal government taking the lead.
As much as I respect Europe and China, America is still the last remaining superpower. Countries around the world are looking not just for the moral message, but also for actions that drive the global economy. An American president can powerfully lead the world economy by dismissing the belief to solve climate change we must all sacrifice. Rather he needs to spread the message that climate change solutions represent the largest wealth creation opportunity of our lifetime."
Jigar Shah is a partner at Inerjys, a $1 billion fund that invests in clean energy via growth capital and project finance, CEO of Jigar Shah Consulting, and a board member of the Carbon War Room.
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