Voices: The Great Resignation is spurring top-tier talent to climate careers

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The sun sets behind a wind turbine  (AP)
The sun sets behind a wind turbine (AP)

In Silicon Valley, few principles are as foundational and accepted as Moore’s Law, the observation that as the capabilities of our computers increase, the costs will decrease. We are seeing this principle in action once more as enormous human talent and unprecedented capital stream into climate tech.

Thankfully, the ability of the private sector to take a leading role in accelerating and scaling climate solutions is completely different from ten, five or even two years ago. We are finally in a position to drive necessary innovation because six key market forces have aligned to create optimal investment conditions to save our planet.

First, the costs have completely changed. In the last 10 years, wind and lithium-ion battery prices have fallen 89 per cent and solar prices by 90 per cent. The cost of clean energy generation is only going to get cheaper, while fossil fuels prices have soared. The cost of electric vehicles on a lifecycle basis is cheaper than internal combustion engines. The so-called “Green Premium” – the added cost of choosing clean tech over a polluting one – is essentially gone in big parts of the economy. It’s not economic to continue investing in a fossil fuel economy when the unit economics of many of the core building blocks of a decarbonized future have shifted, and that’s not even including the climate benefits of transitioning our economy.

Second, major corporations are rapidly recognizing and responding to this shift. GM went from suing California over their miles-per-gallon rules to committing to 100 per cent EVs. More than one-fifth (21 per cent) of the world’s largest 2,000 public companies have made net-zero commitments.

Just 10 years ago, JP Morgan was the most aggressive lender of frontier oil and gas exploration in the world. Now they’ve committed to running their loan book according to the Paris accords. Such commitments are a great step in the right direction, but they need to be put into action. Execution is what really counts – and the world will be watching.

Next, the markets have matured. In 2021, climate tech venture capital (VC) reached 2.5 times pre-pandemic investment levels, accelerating climate companies around the world with more than $37 billion in funding. Between 2015 and 2021, VC fundraising in the United States nearly tripled and investments increased more than 5x.

Consumer awareness has also fundamentally shifted. Consumers across the globe are seeing and feeling the impact of the climate crisis, and are prepared and willing to adjust their lifestyles.

According to a 2019 Nielsen report, 73 per cent of global consumers would change their consumption habits to reduce their environmental impact. Additionally, we see increasing pressure on regulators around the world to embrace bold climate policies – and follow through on them. In an era of harsh partisanship, this is a place where countries can agree.

Finally, the most notable and critical change is an influx of top-tier talent. While other industries struggle to retain their workforce in the face of the Great Resignation, talented workers – particularly young people – are seeking opportunities to work in climate-aligned roles and apply their skills in software development, engineering, consumer products and more, to help solve this existential problem.

If you put unprecedented capital and enormous human talent together, you get a creative explosion. Considering the current estimates of what we need to limit the worst impacts of this crisis, a creative explosion is precisely what we need now. While the current market turbulence will hurt many, previous disasters have proven that real companies addressing real demands will plow through the most difficult economic headwinds. And the demand to save our planet is not going away.

From a strictly economic perspective, despite all the market volatility, the climate tech space is as strong as ever and demand generation only grows. This shouldn’t be a surprise. In the face of previous economic calamities, great companies have always made their way through. Many have even been created as a direct result of the devastation of the time. From the dot-com bust to the Great Recession, we’ve seen that while pretenders wash out, companies that provide something people want and need not only survive, but thrive.

There’s no stopping this transition. It has to happen. But transitioning eventually isn’t good enough. We need to accelerate our deployment of existing technologies or we will blow our 2030 goals.

The good news is that the private sector is bringing together an unprecedented level of capital investment and human talent at precisely the right time to drive the innovation we need. We are poised to scale vital and urgent climate solutions, but we must move quickly and we must move together.

Tom Steyer is an American businessman, hedge fund manager and climate activist who ran for president in 2020. He is also co-chair of the mission-driven investment platform Galvanize Climate Solutions

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