Filed under: Feature
This article discusses how finance, globally, favours ‘clean’ over ‘dirty’ projects. This financial tidal wave is approaching Australia’s shore.
Now, large lenders in the US ask if financing a ‘dirty’ project may damage their reputation. Bank of America and JPMorgan both stopped lending to coal giant Massey Energy and Wells Fargo announced that finance for mountaintop removal was limited and declining.
This is a stong ‘shadow’ carbon price, making the financing of new coal projects – fossil fuel projects – expensive. The result should be that clean and sustainable projects attract more finance.
It shows how increased stakeholder pressure is forcing change to clean and sustainable practices and technologies. See my earlier post on how the supermarkets and other retailers are also reacting to stakeholder pressure and forcing the greenification of their supply chains.
There are hints that Australian banks are very sensitive to the publics’ enviromental concearns. The ‘big four’ banks refused to fund the Gunn’s pulp mill in the Tamar Valley, Tasmania.
Australian banks are primed to do the same in the energy space. 72 % of Australians think future energy needs should be met through renewable energy – wind, solar – and also energy efficiency. This divergence of consumer expectation from reality exposes the banks to reputation – and consequently financial – risk. I expect a change to Australian bank behaviour – and it can not come too soon.
This should have a real impact on the value of intellectual property for clean and sustainable technologies – patents and trade marks in particular. Patent and trade marks are personal property and can be bought and sold just like any other property. Thus, a value can be asigned to them based on what the market is prepared to pay. Increased funding of clean projects makes these IP assests more valuable. A strong portfolio of clean IP assets adds value to a company and can bring in licencing revenue if used smartly.
All of this spells trouble for the coal industry. Just a year ago the coal industry was looking very strong. But every week I hear another story of how support of all kinds for coal is vaporising – much faster than what I thought possible.
Things are looking up for clean and sustainable IP.
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