It takes patience and guts to invest in the environment
Illustration by Satoshi Kambayashi
AL GORE, well known from his movies about climate changes, has also other things to do. He has also a fund-management firm, Generation Investment Management. It has just raised $683m for a fund that will have climate solutions. He hopes that these principles will produce strong profits.
So far, environmental investors should feel green with nausea. The Impax ET50, index of leading environmental shares peaked at the end of 2007 and then plunged by only a forth in January. However, it’s still down 10% on the year, in spite of a recovery.
People think that most green companies just consist of some geeks and a website, but the reality isn’t like that. They have to invest billions of dollars for building a wind farm, new technologies such as cellulosic ethanol or thin-film solar panels. With big investments, they don’t even know for sure if they will make profits. It can take many years and maybe there even won’t be a profit what means that it’s certainly not simple to invest in environmental companies.
The Bush administrations, whose drive for energy independence is big, invested a lot in bio fuels. Investors got disillusioned because there are a lot of doubts about the green credentials of bio fuels. Now, they hope that there will be a new generation of bio fuels that’s better than the current, who are still far away from perfection.
Source: the economist
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