Lessons from Galvanize’s Inaugural Climate Summit

Chloe Jackman Photography

Multi-stakeholder approach, multi-stakeholder opportunity. This is the premise on which Galvanize was built. Trillions of dollars are required to solve the climate crisis – about ~$300 billion per year is needed to hit decarbonization goals in the US – and we aim to shepherd that capital as effectively and efficiently as possible. 

Our network aids us in accelerating and coordinating action on many fronts, from technological innovation to investment to policy to corporate leadership. As pain points are shared and network effects compound, ideas turn to action.

In the spirit of cross-sector collaboration, we recently hosted our inaugural Galvanize Solutions Summit where we convened members of our network to demonstrate how we can bridge the gap between sectors and disciplines and act today on climate. Here’s what we learned:

1. The climate emergency is worse than we projected, but the energy transition is also going better and faster than anticipated.  The Earth’s temperature is rising faster than expected and about a third of days in 2023 have a recorded temperature that is at least 1.5 celsius higher than pre-industrial levels. At the same time, markets, policy and technology are converging to enable climate solutions to scale in this decade. Renewables and electric vehicles are already past their tipping points for wide scale adoption, and incumbent technologies like coal usage and sales of internal combustion engines have surpassed their peak. It’s expected that by 2030 fossil fuel capital investments will halve and renewable energy capex will double

2. The delta between science’s view of the energy transition and that of the investment community is smaller than one might expect.  Amongst investors, there is a growing level of awareness and appetite to invest in climate tech, with the global sector expected to exceed $180 billion over the next decade. Data, incentives and innovative investment approaches are some areas where we are seeing capital markets are already leading the charge toward a climate transition. That being said, we believe there is an enormous amount of education and upskilling for investors entering the climate sector that will require time.

3. Climate is changing the way allocators approach crafting their investment strategy and they view a diverse portfolio as key.  We learned from allocators that they value the opportunity to diversify their climate portfolios, particularly because climate doesn’t always fit into a neat risk return profile. Much of the challenge in making a shift towards financing climate lies in building expertise and common focus among one’s own investment teams and within portfolio companies and managers. The bottom line: there is no one size fits all approach. Setting a Net Zero pledge, disassociation, active stewardship, and resources to embed a climate thematic across and between asset classes/teams can all enable shared focus and upskilling.

4. The Federal Government has doubled down on its loans and grant based investment for early stage companies – but the private sector should lead.  Estimates show that ~$300 billion per year is needed to hit decarbonization goals in the US. We expect the majority of that investment will come from the private sector. With capital needing to be deployed at an unprecedented scale and speed, the Federal Government is stepping in to unlock further private capital by reducing credit risk and building out a bridge to bankability. Outside of government resources, execution is still mission critical and an important way to achieve this is through continued open dialogue between the public and private sectors.

5. Communication is a powerful activation mechanism.  We know that continued and consistent dialogue between sectors is key. We also know that driving the energy transition forward requires buy-in and collaboration from stakeholders. Therefore how we say what we say is equally important. When telling climate stories, and particularly when we are communicating across sectors outside of our own, we can all do a better job of making our point direct, immediate, personal and timely.

6. Companies can leverage their influence, networks, and relationships to successfully model supply chain leadership and transform the operations of their suppliers and partners.  Organizations who want to lead on the energy transition should take responsibility in teaching their suppliers how to invest in clean energy in a neutral or accretive way. In many cases, suppliers and partners greatly desire to operate more sustainably, but need tools and education to understand that there are strategies for them to do so immediately and profitably. Measurement and accurate data collection are also critical components to this process and the recent introduction of SB253 and SB261 in California (which impose extensive climate disclosure obligations on thousands of public and private companies) only underscores this point.

7. The road to clean, renewable energy is on hyperdrive – but coordination at all scales is required to keep up the pace.  We’ve seen the effects of policy, capital, and technology working in coordination to push the energy transition forward. But there is acknowledgment across sectors that continued market coordination is needed to continue to stimulate supply and demand. For instance, we expect transforming buildings will encompass a significant portion of the transition, both through electrification of existing systems and energy use reductions, as well as the integration of distributed renewables into existing infrastructure. This will require massive, sustained coordination between governments, real estate organizations, and energy companies.

Equally as important is the coordination that occurs at an individual level. For starters, there is an opportunity for talent with fossil fuel expertise to transition their skillset to climate applications. But as demonstrated at the Climate Summit, many have transferable skills that can be leveraged to not only support the energy transition but also to generate value for their organization in the process. 

The energy we felt at an individual level amongst the attendees at our Climate Summit – and the combined work streams that have since ensued – are a powerful reminder of the compounding effect of the multi-sectoral network that underpins everything we do at Galvanize.

If any of the ideas above resonate and your organization is interested in joining our open dialogue, feel free to reach out to a member of our team at [email protected].