Reaping the Economic Benefits of Climate Restoration

Investments in climate restoration strategies could produce trillions of dollars in future returns.

Reaping the Economic Benefits of Climate Restoration

GLOBAL INVESTMENTS IN strategies that address climate change could produce a return on investment of up to US$7.1 trillion by 2030. This is the prediction of a recent report released by the ThunderbirdSchool of Global Management in Glendale, Arizona. Sanjeev Khagram, its author and Thunderbird’s director general and dean, shared its findings in January at the World Economic Forum held in Davos, Switzerland.

Khagram explains that the $7.1 trillion breaks down across five areas. Rebuilding shorelines and other infrastructure to withstand rising temperatures and sea levels could result in $4 trillion in benefits. Upgrading infrastructure to reduce flood risks and safeguard water supplies could create $1.4 million in benefits. Restoring mangrove forests that protect coastal communities could generate $1 trillion. Finally, improving agricultural practices in arid regions and building early warning systems for storms and other events could pay off $700 million and $100 million, respectively.

Perhaps the biggest, but as yet unknown, economic payoffs could come from carbon capture technologies. He points to the potential market value of technology that turns sequestered carbon dioxide into carbon-based materials. These lightweight, high-performing materials could be used in place of everything from steel to copper electrical wiring. In addition, researchers are currently developing and testing methods to restore ecosystems in the ocean and thicken ice layers in the Arctic.

Companies already are making bets on the high-growth potential of such technologies. In January, Microsoft announced its intention to be carbon neutral by 2030. The company has launched a $1 billion fund to support development of carbon reduction, capture, and removal technologies over the next four years. Its goal is to remove from the air all the carbon it has emitted since 1975.

In December, Goldman Sachs announced that it would spend $750 billion on sustainable finance projects by 2030. That same month, companies Blue Planet and Kamine Development Corporation Sustainable Infrastructure formed a partnership to scale the production and use of carbon-negative concrete. This could make a significant difference: The manufacture of cement, a component of traditional concrete, creates nearly 8 percent of global carbon emissions each year.

In April 2019, Arizona State University in Tempe and Silicon Kingdom Holdings announced an agreement to deploy “mechanical trees” developed by Klaus Lackner, director of ASU’s Center for Negative Carbon Emissions. Lackner’s carbon-capture technology removes CO2 from the air thousands of times more efficiently than natural trees.

“It is this type of bold and audacious effort during this ‘decade of action’ that will contribute to ensuring the survival and flourishing of humanity,” Khagram writes. “What is needed now is a transformative, global, multi-stakeholder partnership to catalyze and connect the mounting initiatives on climate restoration.”

In Davos, Thunderbird and The Foundation for Climate Restoration announced the launch of the Global Climate Restoration Task Force, which will explore strategies to scale climate restoration initiatives. Partners include the Office of the Presidency for the Republic of Kenya, Ice911 Research, Ocean- Climate Trust, NEXUS, the Office of Santa Clara County Supervisor Dave Cortese in California, and Earth Day Network.