This Entrepreneur Plans to Save the World, $1 Trillion at a Time

A trillion dollars here, a trillion dollars there, and pretty soon you’re talking about real solutions to climate change.
“Impact to me means $1 trillion,” says Jigar Shah, president and co-founder of Generate Capital, a new specialty finance company that works with project developers and technology manufacturers to finance what he calls “the resource revolution.”
First, a little background on Shah. As the founder of solar giant SunEdison, Shah cracked the code and laid the foundation for the explosive growth of not only SunEdison, now worth more than $5.5 billion, but also Elon Musk’s SolarCity and others. His no-money-down, pay-as-you-save business model unlocked the hundreds of billions in secondary financing that has driven the quadrupling of installed U.S. solar capacity in the past five years. Last year, solar and wind together accounted for more than half of new U.S. electrical generating capacity. “Impact means people follow you,” Shah adds.
Since he left SunEdison five years ago, Shah has worked through outfits such as Richard Branson’s Carbon War Room, where he was founding CEO, to build the business case for scaling up other clean-tech industries.
Related: Making a Business of Premium Coffee for Premium Social Impact
This is where the trillion-dollar projects come in. At the Carbon War Room, Shah became known as a champion of the “gigaton throwdown,” a 2009 challenge to reduce annual carbon emissions by 17 gigatons (from 36 gigatons today), in order to avoid a catastrophic rise in global temperatures. Shah focused on specific areas called “wedges” that have potential for one-gigaton carbon reductions, including energy, water, waste, transportation and agriculture.
The required changes are massive as each area (wedge) represents an investment opportunity of $1 trillion or more, according to multiple estimates, in order to bring sustainable infrastructure to billions of people around the world. A one-gigaton reduction in transportation, for example, would require swapping out a billion cars that get 20 miles per gallon for ones that get 40 mpg.
This is what Shah calls Creating Climate Wealth, the title of his 2013 book in which he lays out the roadmap for approaches that can more than pay for themselves, but require massive infusions of upfront capital. Though renewables such as solar cost less over time, consumers had a hard time justifying, if even affording, the upfront costs of the equipment and installation.
At SunEdison, Shah helped introduce the 20-year power purchase agreements that bring together customers, investors, clean-tech manufacturers and government regulators with terms they can all understand. SunEdison would install and service the equipment, ensure it performed as expected and deliver reliable, long-term dividends to investors.
Generate Capital, launched last year by Shah and co-founders Scott Jacobs and Matan Friedman, aims to demonstrate the investment opportunities in other proven approaches in renewable energy, energy storage and energy efficiency. The firm already has north of $100 million to begin underwriting clean-tech projects. Though some impact-driven family offices are on board, Shah is seeking mainstream investor capital. Read More