Q: Is this philanthropy?
A: No. All of the one trillion dollars worth of investments will be based on typical market rates of return for the type of risk category according to your financial institution’s underwriting criteria and fiduciary responsibility.
Q: What type of investments will we be making?
A: The investments will be in infrastructure based on renewable energy and clean technologies, with physical asset value and dedicated, predictable revenue streams with which to repay both debt and equity investments, but primarily debt instruments such as normal capital market bond financing to build and operate basic infrastructure.
Q: Will we be contributing money into some type of managed fund?
A: No. Your institution will directly make all of the investments. You will control the decision-making process as to whether or not to make any particular investment, choosing from a broad and diverse range of types of investments by country and region, by technology, by governance, by rate of return, by risk, by growth potential, and many other key decision factors.
Q: Will there be any kind of credit enhancement, loan guarantees, or public subsidies?
A: We expect that for each investment opportunity there will be public intervention by national governments, international agencies such as the UN and World Bank, and international donors ranging from official development assistance from developed country governments to private foundations, to ensure the safety and soundness of these investments both as to definite returns to the investors and as to the effectiveness of the infrastructure and technologies in promoting Climate Prosperity.
Q: If I make a commitment, is it legally binding?
A: No. Your commitment is a statement of intent. You are stating that your financial institution, in its strategic portfolio investment planning for the decade 2010 to 2020, intends to make a certain dollar amount of investments in renewable energy and clean technologies in developing countries, provided that each and every investment meets all of your institution’s underwriting criteria as to safety and soundness. You will not be required to make any investments that do not fully satisfy all such criteria, meaning that by the end of 2020, you might not fulfill your original commitment in terms of the total dollar amounts invested, or alternatively, you might also exceed your original commitment and invest more money than you initially intended.
Q: How do you define developing countries?
A: We use the United Nations definition of developing countries, all of which will be eligible for investments under the Global Climate Prosperity Agreement. In addition, $200 billion of the total one trillion dollar deal will be targeted to the Least Developed Countries, as defined by the UN.
Q: How do you define renewable energy?
A: The Global Climate Prosperity Agreement follows the definition of renewable energy according to the official Statutes of the International Renewable Energy Agency (IRENA) signed by 136 countries worldwide. Eligible investments include solar, wind, hydropower, geothermal, tidal, wave, biomass, biofuels, and energy efficiency.
Q: How are clean technology investments defined?
A: The specifics will change over time as new technologies emerge and can be scaled up, but the bottom line is that clean technologies are defined as being environmentally sustainable in terms of the overall ecological footprint based on how the resource inputs are obtained, the production process in the use of the materials, the deployment and environmental impacts of the technologies, and the ability to completely recycle all of the component resources in harmony with the cycles of nature such that essentially there is no waste.
Q: Why do you take this approach?
We agree with the business sustainability movement’s argument that Resource Efficiency and Energy Productivity, as defined for example by McKinsey and other management consultants, is the only way for companies or communities to survive and thrive. As we say, in the 21st century people, places, and organizations can only get richer by becoming greener, and can only earn more money by using fewer resources and reusing more.
Q: What is the main purpose of the Global Climate Prosperity Agreement?
A: The overall purpose of Climate Prosperity is to enable people, places, and organizations worldwide to achieve and maintain a high standard of living based on innovation, efficiency, and conservation in the use and reuse of all natural and human resources, thereby moving the global economy by 2020 from its current system of resource-wasting industrialism to a new economically and environmentally sustainable resource-saving industrialism. Climate Prosperity is about the wise and efficient use and reuse of all resources in relative harmony and balance with nature. This includes, of course, reducing the use of fossil fuels such as oil, gas, and coal, and drastically reducing emissions of greenhouse gases such as carbon dioxide and methane. However, it also involves water, land, air, trees, plants, animals, and every other resource, especially people.
