Carbon neutrality: HSBC invests US$100 million in Bill Gates-led green tech programme to support decarbonisation of heavy polluting sectors
- Bank will become an anchor partner in Breakthrough Energy Catalyst, an initiative within the Breakthrough Energy network founded by Gates
- In December, HSBC unveiled a timeline for ending the financing of coal projects
When financial institutions such as HSBC announce net-zero carbon goals, they refer to the net emissions of their clients. Net-zero can be achieved by making investments to reduce one’s carbon emissions and offsetting any residual amount by buying credits from other parties’ carbon reduction projects.
In December, HSBC unveiled a timeline for ending the financing of coal projects to achieve its net-zero carbon emissions goal. It plans to reduce its exposure to coal mining and coal-fired power plants by at least a quarter by 2025 and to halve it by 2030, from last year’s levels. The bank has already stopped financing new coal-fired power plants and coal mines.
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China completes its first greenhouse gas observation network
Breakthrough Energy Catalyst is looking to leverage private-public capital to support commercialisation of new technologies that will help achieve net-zero emissions by 2050.
The initiative focuses on four critical technologies – direct air capture, clean hydrogen, long-duration energy storage and sustainable aviation fuel to support decarbonisation of high-carbon sectors.
Half the technologies that are needed to achieve carbon neutrality goals either do not exist yet, or appear to be too expensive for much of the world to afford, HSBC said.
Hydrogen will be 95 per cent cheaper in 2050, but it will lead to expenditure worth US$10 trillion, according to a report published this month by research firm Rethink Energy.
Jonah Goldman, managing director of Breakthrough Energy Catalyst, said its partners including HSBC are “taking real action and willing to make meaningful investments” by joining the programme.
On Thursday, Swiss Re announced that it had partnered with NORD/LB, a renewable energy financier, to launch a US$500 million environment, social and corporate governance investment programme.
