According to Climatesignals.org in the 1950’s there were 1.09 high-temperature records for every 1 low-temperature record in the US. In the 1990’s it was 1.36/1 and in the past 365 days, it was 1.72/1. There is year-over-year variability, but the trend is clear. 70% of Americans now accept that climate change is happening, outnumbering those who don’t by a 5 to 1 ratio, according to a survey by the Yale Program on Climate Change Communication.
While I am in the camp of the majority, the point is that regardless of what you believe, the fact that the majority are on board with climate change being real means that capital will be allocated to those technologies that help mitigate it.
Geekwire reports that Washington Governor Jay Inslee is running for president with climate change as the centerpiece of his campaign. A quote from that article confirms my thesis on capital allocation: “The fastest growing job in the nation is a solar installer,” he said. “Number two? Wind turbine technician. Climate change is not more important than the economy. It is the economy.” The last statement is quite profound, it’s worth repeating. Climate change is not more important than the economy. It is the economy.
Sustainable investing (ESG) mandates are rising and there have been studies showing that investing with an ESG tilt would have produced superior returns. Every week there seems to be a new fund offering an ESG focused strategy.
The takeaway is that more people believe it is happening, companies are allocating capital to it, and investors are jumping on the bandwagon too.
According to Climatesignals.org “looking ahead, under a moderate rising emissions scenario, the ratio of record high maximum to record low minimum temperatures in the US is projected to increase with ratios of about 20 to 1 by mid-century and roughly 50 to 1 by the end of the century.” If they are even partially correct, the climate change tailwind is going to be huge.