Goldman Sachs to invest $150bn in clean energy

Banking giant Goldman Sachs has announced it will leverage $150bn into clean energy financing and investments by 2025 as it also aims to become the first US investment bank to be carbon-neutral across its operations.

The bank has unveiled an ambitious new roadmap for its continued environmental progress that will develop a number of new sustainability targets as part its Environmental Policy Framework. The $150bn investment expands on the existing $40bn target set in 2012.

Goldman Sachs chairman and chief executive Lloyd Blankfein said: “Over the past 10 years, we have built on our commitment to harness market-based solutions to help support a healthy environment and address the problem of climate change.

“We will continue to work towards deploying innovative financial mechanisms through an expanded investor base focused on environmental opportunities.”

First established in 2005, the Environmental Policy Framework has been expanded to include new key indicatives. Goldman Sachs set a target to become the first carbon-neutral US bank by 2015. Since 2012, it has reduced CO2e by 20,000 tonnes to 162,000 tonnes.

By 2020, the firm will seek to invest $2bn into green operational investments and source 100% of its global electricity needs from renewable energy. The bank will also deploy clean energy solutions into under-represented markets with poor access to renewable solutions as part of a Clean Energy Access Initiative.

Goldman Sachs will also work with collaborators to produce carbon offsets and invest $10m in grants that will unlock capital and generate momentum for environmental solutions. The framework also covers initiatives to generate capital for water and climate risk solutions while developing green bonds and increasing environmental and social risk management systems.

Goldman Sachs head of environmental markets Kyung-Ah Park added: “Environmental issues have become increasingly relevant to our clients and our investors, and have become core to our business. We are leveraging the talents of our people and the breadth of our businesses to facilitate the transition to a low-carbon future and promote sustainable economic growth.”

Environmental Stewardship

Since the launch of the Framework, the firm has invested $65bn into clean energy and has structured over $14bn in natural catastrophe bonds. Over 50% of its global office portfolio is now green building certified and its solar arrays have received first rate securitization.

Earlier this year, Goldman Sachs joined the RE100 initiative along with other high profile companies including NIKE and Procter & Gamble, announcing a commitment to sourcing 100% renewable energy.

The firm also formed part of a 13 member team of American multinationals, alongside Apple and Coca-Cola, pledging $140bn of new low-carbon investment to support President Obama’s Climate Action Plan.

Yesterday (2 November), it was also announced that Goldman Sachs would team up with conglomerate General Electric to access private sector finance for water reuse projects to mitigate the scarcity crisis.

Matt Mace

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