One of the biggest investors in the world Temasek Holdings and asset manager BlackRock are initiating a green investment of combined $600 million in companies that use technology to reduce carbon emissions.
The partnership is called Decarbonization Partners. It will launch a series of late-stage venture capital and early growth private equity green investment funds. The goal is to support the companies that can provide a solution to achieving a zero-emission economy by 2050.
The target for the money raised in the first fund is $1 billion, including their investment. The companies that attract their interest are in areas of electric and autonomous vehicle technologies, battery storage, grid solutions and emerging fuel sources.
“For decarbonization solutions and technologies to transform our economy, they need to be scaled,” said Larry Fink, chairman and CEO of BlackRock. “To do that, they need patient, well-managed capital to support their vital goals.”
“Bold, aggressive actions are needed to make the global net zero ambition a reality,” said Dilhan Pillay, CEO of Temasek International. “Through collective efforts with like-minded partners, we will be able to create sustainable value for all of our stakeholders over the long term, and investors will have the opportunity to help deliver innovative solutions at scale to address climate challenges.”
In fact, BlackRock has been committed for a while now towards a green transition. It calls for disclosure of the sustainability of companies and wants to know how they plan to survive in a net-zero emissions world.
Green Investment Initiatives
An increasing number of green investment vehicles for emissions reducing technologies are appearing on the horizon. Bill Gates’ Breakthrough Energy is an investment fund that includes a venture capital arm supporting the scaling of net zero innovations. Part of Biden’s American Jobs Plan that will invest $2 trillion over this decade on supporting the post-covid economy, will go for decarbonizing the economy.
Tech billionaire Elon Musk has also claimed to invest $100 million for the best carbon capture technology. Even the Australian government is launching a $50 million fund towards carbon capture use and storage development.
The partnership between the two major investment management companies is showing the firms are taking a big swing towards carbon-reducing technologies. The flood of capital coming into sustainability companies is a potential opportunity for investors to generate great returns.