GORE: EMISSIONS-INTENSIVE BUSINESS IS SUBPRIME

Al Gore made a penetrating point when he warned business leaders and investors that investing in companies consuming too much energy or producing too many greenhouse gas (GhG) emissions was like investing in subprime mortagages. Gore: "…the assumption that you can safely invest in assets that come from business models that assume carbon is free is an assumption that is about to go splat…You have lots of assets, many of you do, in your portfolios right now that truly do deserve that epithet 'subprime.'"

At the same conference, 50 institutions (with $1.75 trillion in assets) agreed to up investment in New Energy and energy efficiency $10 billion and set a goal of 20% decreased energy use in core real estate investment holdings.

A UN leader called the commitment to these investments and the drive for new Energy they represent "…as important as the computer revolution in generating new wealth and jobs."

The UN leader was echoed by Fred Krupp, president, Environmental Defense and author, "Earth: The Sequel": "There'll be a whole cascade of private capital flowing to remaking the energy infrastructure of our world, because it's a multitrillion—dollar business…Increasingly, you're seeing this point of view not only in America, but with politicians in other countries as well."

But Gore’s admonition most effectively hung in the air: "You need to really scrub your investment portfolios, because I guarantee you — as my longtime good redneck friends in Tennessee say, I guarandamntee you — that if you really take a fine—tooth comb and go through your portfolios, many of you are going to find them chock—full of subprime carbon assets…"

Accepting the Nobel Peace Prize did not slow Gore down. He is still leading the way. (click to enlarge)

Gore: Beware ‘Subprime Carbon’ Biz
John Heilprin, February 15, 2008 (AP via Time Magazine)
and
Investors pledge $10 billion for renewable energy
Timothy Gardner (w/Eric Walsh), February 14, 2008 (Reuters)

WHO
Al Gore, former Vice President of the U.S./Academy Award-winning documentary film maker/Nobel laureate; United Nations’ support organizations the U.N. Foundation (Timothy Wirth, president), Ceres (Mindy Lubber, president ) and the U.N. Fund for International Partnerships; 500 prominent financial leaders and institutional investors; California State Treasurer Bill Lockyer

WHAT
At a conference for the money men sponsored by the UN backers, Gore called on business leaders and investors to cut back on energy intensive/greenhouse gas (GhG) intensive investments. In response, the attendees committed $10 billion to New Energy and energy efficiency.

Woods Hole and Harvard Professor John Holdren may have encouraged financial commitments with this slide. (click to enlarge)

WHEN
- In 2005, $1 billion was pledged for New Energy and energy efficiency.
- This year, $10 billion was pledged over the next 2 years.
- The commitment to decreased energy consumption in real estate investment will be over 3 years.

WHERE
- The conference, called the largest gathering of business leaders on climate change ever, was at the UN in New York City.
- 11 state treasurers/comptrollers pledged state pension fund investments.

Or it may have been this slide from Professor Holdren that brought out the commitments to invest. (click to enlarge)

WHY
- It was estimated the attendees control $20 trillion.
- Lockyer promised CA pension funds will invest $800 million toward the New Energy/energy efficiency goals.
- A McKinsey Global Institute report released at the conference predicted the investments will earn double-digit rates of return over the next ten years.

Fred Krupp's new book is said to be full of data on New Energy's wealth-engendering potential. (click to enlarge)

QUOTES
- Vinod Khosla, venture capitalist/co—founder of Sun Microsystems: "As soon as people believe carbon has a price, it's going to have a price…"
- Peter Darbee, chairman/CEO, utility PG&E Corp.: "[Utilities] that burn coal should have to pay for clean energy."
- U.N. Secretary—General Ban Ki—moon: "The shift towards a greener future is still in its infancy and needs nurturing…While the world looks to the U.N. to steward the negotiating process, the United Nations looks to you, as leaders in the financial sector, to lead in innovating financing and technological development."
- John Sweeney, president, AFL-CIO: "These deferred wages of working people [part of the $5 trillion union retirement funds] are the capital that can fuel the energy economy of the future…"