Tag Archives: renewable enrgy investing

Merchants of Doubt vs. Investors in Faith

A new documentary based on the 2010 book “Merchants of Doubt” opened in US theaters a couple weeks ago. The book’s authors describe their journey into  “how a loose–knit group of high-level scientists, with extensive political connections, ran effective campaigns to mislead the public and deny well-established scientific knowledge over four decades.” No surprise that a hot topic central to the trip was global warming.

Unfortunately, it would be more than a little naïve to think that the premise of the documentary isn’t true. On an annual basis, the fossil fuel industry’s revenues are well north of $4.5T. That’s a lot of money and a lot of deeply entrenched interests. If you have seen the “clean coal” ads over the past decade, you know that companies in the industry have been perfectly willing to aggressively mislead the public. Then, we have the fact that a central character in the story is a fellow named Marc Morano. You don’t have to be a rocket scientist to figure out that he’s not one either. The idea that anyone would take Morano’s analyses of climate science seriously is incredible –  an indication of how cynically “successful” his efforts have been.

Another angle of this story relies on tired and simplistic depictions of the people who care about the health of the planet. There is a sad irony in the fact that we are often painted as being naïve about how financial and economic systems operate. This caricature is a standard fallback for capitalism’s true believers – a group that ignores the lessons of history, who argue that unfettered market forces will always find a sweet spot that bridges what is good for people with what is good for business and financial well-being. That’s about as naïve as you can get.

More and more investors are demonstrating an increasingly nuanced approach to the connections between their money and a sustainable world. According to a new Morgan Stanley study, a surprising “71% of individual investors are interested in sustainable investing.” Women and millennials in particular are connecting the dots. Not surprisingly, the study also shows that the interest doesn’t yet translate into action for all of those people. Nevertheless, the fact that more than 2/3rds of the investment population is thinking about sustainability is a powerful thing – especially since the societal and environmental forces that are creating that interest are going to become more powerful over time.

Maybe, just maybe, another set of recent data hints at the leading edge of another fundamental shift. Over the past couple centuries, energy has become an  essential (perhaps ‘the’) driving component of economic growth and human progress. In the absence of a clear focus on energy efficiency and renewable power generation, it’s not at all surprising that greenhouse gas emissions have grown in lockstep with economic activity. The good news is that, according to an early analysis by Bloomberg New Energy Finance, China’s carbon emissions fell by 2% last year while their economy grew by 7.4%. The estimates of the wider global economy show a 3% rise in the economic growth in 2014 with carbon emissions remaining flat. This “decoupling” of lockstep economic growth and emissions is unusual. The hope going forward is that this is a sign that regional efforts like China’s focus on pollution reduction and the European Union’s ahead-of-schedule push to 20% renewable generation by 2020 are game-changers.  Whether or not 2014 was the start of something big remains to be seen. But, if the well documented growth in global clean energy investment enables the decoupling to accelerate at the pace needed, 2014 will turn out to be a pivotal year – for the planet and for investors.

Fossil fuel divestment is one way to show that you are not being snowed by the chaff that the “Merchants of Doubt” are happily (and very effectively) tossing out into the world. Reinvesting in the new energy economy is a way to support the continued growth of businesses whose products and services push emissions down,  and enable us to move farther and faster toward a new energy economy.

Your investments matter. Join the community of investors who have faith in science, and in humanity. Divest now.