7 Ways to Finance Your Net-Zero Transition

According to the United Nations-backed Race to Zero global campaign, in 2020 alone, 3,067 companies, 733 cities, 3,000 hospitals, 624 educational institutions and 31 regions all committed to  a business strategy that would change their operations and stop adding emissions to the atmosphere.  

At the same time, one in every three investment dollars – 33% of the $51.4 trillion in total U.S. assets under professional management – is an environmental social and governance (ESG) investment. Shifting to ESG investments that accelerate a socially responsible, clean energy transition goes hand in hand with net-zero goals and interim targets. 

That’s why we’re launching a series of tools to help your stakeholders achieve your net-zero goals and interim targets.  

Because finding the money is always required for any strategic business initiative, the first tool in the series is a new eBook: Financing Your Net-Zero Transition. 

How do you pay for your net-zero transition? 

We hear these questions and others like it every day: “How do we pay for renewables and large-scale investments in the clean energy transition?”  

Soon after, we hear, “How do we update and engage our stakeholders, too?” 

There is no one answer or one size fits all. Just as every sustainable energy investment involves many teams across an organization – board members, executives, operations, engineering, sustainability, supply chain management, employees, facilities, fleet management – there are many project financing options and many stakeholders to bring along for the ride. 

7 Ways to Finance Your Net-Zero Transition

Whether you choose to fund your sustainable energy and net-zero transition as a capital investment (capex) or operational expense (opex), more options are available today to support your shift than ever before.  

We’ve broken these emissions accounting mechanisms, incentives and financial vehicles into seven categories:

1. 1. Government incentives: Grants, green bonds, loans and tax credits, state, local and federal incentives continue to drive the shift to a carbon-free economy
      
   2. Utility programs: Energy utilities either administer or directly provide programs for energy efficiency and renewables across the country.
      
   3. Managed services agreements: Many organizations with restricted capital access are looking to outsource energy investments and efficient equipment investments as a great alternative to cash or loans.
      
   4. Renewable energy credits (RECs): Organizations constrained by available on-site space or other infrastructure can tap RECs and fund new zero-emissions projects.
      
   5. Power purchase agreements (PPAs): Leveraging the cost offset of renewable energy transmission, physical and virtual PPAs have proven a boon to bottom-line energy cost savings and new wind, solar and energy storage projects.
      
   6. Community solar and clean energy microgrids: Aggregating multiple buyers for community solar projects and microgrids helps lower emissions in a region while adding more resilient, reliable and emissions-free energy.
      
   7. Electrification: Shifting equipment, vehicles and fleets to electric – and particularly electricity provided by a clean local grid or your own renewables investment – is seen as the best place to make net-zero commitments across your operations and supply chain a reality.
      

How can you achieve net-zero in your operations?

Financing your net-zero commitments is very strategic. That means your organization is committing a full life cycle to either eliminate or fully offset its emissions. Keep in mind: That means eliminating emissions from:   

1. Fuels creation: Exploration, pumping/extraction, transport to refinery, refining, transport to usage, etc. 
2. Manufacture and build: Utility plant construction; manufacture of solar panels, wind towers, batteries, generators, etc. 
3. Ongoing generation/usage: Burning gas, diesel, coal, co-generation fuels, etc. 
4. Maintenance and operation: Human and goods transportation, oil changes, fuel transport and storage, pipeline maintenance, etc. 
5. End of life: Decommissioning, recommissioning, refurbish and reuse, recycle, waste management
   

We hope our eBook helps you accelerate your shift to carbon-free operations and opens the potential for a broader mix of monies (and greater returns on investment) you need to hit your emissions reductions targets faster.  

Have a need for other materials to speed your clean energy transition? Send us a request. We want to hear from you.