Goldman Sachs Commits to $40 Billion in Green Economy Investments

At its annual meeting this week, Goldman Sachs will announce its intention to reduce carbon emissions to zero by 2020 and invest $4 billion a year for the next 10 years in green economy projects, reports Reuters.

The company plans to arrange financing and invest in the full range of green projects, calling it one of the greatest opportunities for profits: renewable energy, energy efficiency and storage, lighting, transmission, green materials and transportation.

A majority of those funds won’t be it’s own, most will come from clients, and Goldman Sachs will set up the deals.

Last year, they co-invested $500 million and helped finance $4.8 billion in clean energy companies global, they say. They are underwriters for SolarCity’s upcoming IPO. 

Last year, when the Dept of Energy awarded its final loan guarantees for renewable energy projects, the $1.46 billion in  partially guaranteed loans for First Solar’s Desert Sunlight Project, were to be funded by a group of investors led by  Goldman Sachs and Citigroup.

Athough $4 billion a year is a lot of money, it’s about the same as from 2005-2011, when they arranged financing for $24 billion worth of projects and invested $4 billion of it.

"Obviously we recognize this is not the easiest of times in the clean energy market but nevertheless the underlying thesis as to why cleaner and more sustainable forms of energy need to scale up still holds true," Kyung-Ah Park, head of environmental markets at Goldman, told Reuters.

He’s referring to the difficulties the renewable energy industry is experiencing because of the combined pull-back in government support and the surge in natural gas supplies.

At the same time, Goldman got an "F" in the latest edition of "Dirty Money," which rates the largest US banks on financing coal generation (mountaintop removal coal mining and coal-fired power plants. 

The company is a member of the Carbon Disclosure Project, which provides a global system for companies and cities to measure, disclose, manage, and share climate change and water information.