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How to finance the building of a new climate infrastructure

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How to finance the building of a new climate infrastructure

Entrepreneurs with concepts for addressing local weather change typically run into financing hurdles. This may occur initially, when they’re making an attempt to take an thought from the lab to a prototype, or it occurs a number of phases on, when it comes time to construct a facility at business scale.

This latter stage is usually a “second valley of loss of life” for local weather initiatives. That’s as a result of the quantity of financing wanted at this level is greater than a enterprise or growth-equity fund would supply, whereas larger conventional project-finance or infrastructure funds typically discover the potential returns of financing these buildings don’t warrant the funding danger.

Analysis performed since early final yr by the non-profit Prime Coalition was not too long ago printed in a report, Limitations to the Well timed Deployment of Local weather Infrastructure. It particulars 4 areas the place main gaps in financing can stymie entrepreneurs and what to do about it.

To know the issue, take into consideration solar energy. The know-how to provide vitality from the solar was invented within the Nineteen Seventies, but it surely took many years for photo voltaic initiatives to grow to be mainstream, says Karine Khatcherian, creator of the Prime report and who’s now at Closed Loop Companions’ Personal Fairness Fund. Incentives had been required to construct amenities, and as extra photo voltaic was deployed, prices got here down considerably. “We are able to’t wait 40 years for all that to occur with each know-how,” Khatcherian says.

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The query is whether or not catalytic capital – that’s, affected person, risk-tolerant funding financing designed to have a constructive affect with out essentially realizing a market return – can assist to speed up innovation by decreasing or eliminating dangers “or by stepping in earlier than others can,” she says.

Lengthy-term financing
The primary two gaps Prime’s analysis recognized centre on initiatives with lengthy know-how cycles akin to what photo voltaic skilled, in that they’re concepts that should be scaled as much as show their business viability. An instance might be a business scale facility to scale back the carbon emissions related to the manufacturing of cement, in accordance with the report.

Local weather innovators can run into hassle if they’re on the “late demonstration” stage, the place mission growth and development prices for deploying their concepts can complete greater than $20m, or when they’re in search of financing for a first-of-a-kind, or Foak, business mission, the report mentioned.

Foak initiatives are the primary business initiatives to be realised from an thought. They “are supposed to be worthwhile, [to] reveal the mission could be commercially possible, and are the reference for the upcoming initiatives,” the report mentioned. However, they “nonetheless have a lot higher danger and uncertainty than ‘confirmed’ initiatives,” Khatcherian says.

As soon as a Foak facility is constructed, points can come up – comparable to value overruns or issues with efficiency high quality – that require the development of 1 or two or three extra amenities to construct the required monitor report to show financial feasibility, she says.

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The third financing hole happens with small, distributed initiatives that don’t require the development of a single massive facility. Consider rooftop photo voltaic, or ground-source heating options – initiatives that want a couple of million {dollars} to fund a couple of small installations.

Returns for these initiatives gained’t be excessive sufficient to attract enterprise funding, and mission finance or infrastructure funds usually look to spend money on far larger initiatives, given the analysis required to analyse each regardless of the scale. “It’s onerous to make the economics work,” Khatcherian says. “It’s simpler [for investors] when [an entrepreneur] can combination 20 initiatives directly.”

The fourth hole is the problem in financing early growth prices, comparable to shopping for actual property, conducting pre-engineering design, or securing permits. For some, “there’s a whole lot of work that must be carried out earlier than a mission is prepared for development,” Khatcherian says. “If any of those steps don’t succeed, that might kill a mission and that’s a danger project-finance buyers usually don’t face.”

Bridging the Hole
Catalytic capital might probably get entrepreneurs over these early hurdles, complementing different private and non-private sector buyers and philanthropists in shifting know-how improvements via this “second valley of loss of life”, in accordance with the report.

Due to the urgency of the local weather disaster, the report considers the chance that catalytic capital might finance 100% of the hole. Beneath this situation, affect buyers would step in after all of the dangers of the mission are addressed, offering funds for the catalytic buyers to redeploy into one other mission, Khatcherian says.

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Or, catalytic buyers might present only a slice of help tailor-made to a selected danger, comparable to first-loss fairness in opposition to value overruns. Or they might present below-market debt to enhance the economics of a mission to the purpose mainstream buyers step in, she says.

A perfect resolution in Khatcherian’s view is “blended finance,” the place catalytic capital is pooled with development capital and mission finance that may be deployed the place wanted relying on the hole being addressed.

Prime’s analysis additionally discovered that local weather innovators may benefit from instruments comparable to accelerators that facilitate entry to funders and technical help, and from an advisory group crammed with specialists comparable to engineers, operations specialists, contractors, and others who can assist entrepreneurs get via these difficult early growth phases.

With this analysis in hand, Prime now’s taking a look at creating a brief listing of potential investees throughout the subsequent 5 months or so, Ananth Pharshy, a senior adviser to Prime’s Early Local weather Infrastructure programme says. They’re additionally starting to listen to from philanthropists.

“There’s great curiosity,” he says. “Individuals on this house for some time intuitively perceive the issue, that Foak and demonstration initiatives are having problem getting funded. The philanthropic neighborhood is saying ‘we’re able to go whenever you’re prepared.’”

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Deal with initiatives
Prime plans Foak initiatives between now and the fourth quarter of 2023. They’ll have “a selected give attention to initiatives that will face the capital hole most acutely, have the best potential to scale back [greenhouse gas] emissions, reveal that our participation will assist usher in different finance-first buyers, and may bridge to follow-on deployment of the identical or comparable options”, Sarah Kearney, Prime’s founder and govt director, mentioned in an emailed assertion.

Kearney mentioned Prime will experiment with investing in several mission sizes, industries, and capital buildings as a complement to their analysis. “From there, we’ll have a greater understanding of whether or not and the way Prime would possibly construct a extra everlasting program round early local weather infrastructure within the years forward,” she mentioned.

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GOP Rep. Andy Ogles faces reelection amid FBI campaign finance probe

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GOP Rep. Andy Ogles faces reelection amid FBI campaign finance probe

Andy Ogles, a freshman Republican from Tennessee, is hoping to retain his seat in the U.S. House of Representatives amid an FBI investigation into alleged discrepancies in his 2022 campaign finances.

As the first-term congressman seeks reelection, he will face a strong challenge from Democrat Maryam Abolfazli, a progressive advocate from Nashville, in a district that has become increasingly competitive following recent redistricting.

Ogles, a member of the conservative House Freedom Caucus, confirmed in August that federal agents had seized his cellphone as part of an ongoing investigation into his campaign’s financial filings.

The inquiry stems from reported inconsistencies in Ogles’ 2022 records, including a $320,000 loan he initially reported making to his campaign.

Newsweek has contacted Ogles’ office for comment via email.

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U.S. Rep. Andy Ogles speaks to supporters after being declared the winner in his Republican primary race, Aug. 1, 2024, in Franklin, Tennessee. He is hoping to fend off Democratic opponent Maryam Abolfazli in Tennessee…


Mark Humphrey/AP, file

What is Andy Ogles Accused Of?

Ogles later amended his filings, lowering the figure to $20,000, and explained that the larger amount had been a pledge, not an actual loan, which he claimed was mistakenly included in the reports.

In addition to the phone seizure, FBI agents obtained a warrant to access Ogles’ personal email account.

However, according to court documents, investigators have yet to review the contents of the account.

Ogles has publicly stated that he is fully cooperating with the investigation and believes the discrepancies were the result of honest errors.

Why is Nashville Left-Leaning?

The scrutiny follows an ethics complaint filed in January 2023 by the Campaign Legal Center, which raised concerns about potential violations related to his personal and campaign finances.

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Democratic congressional candidate Maryam Abolfazli
Democratic congressional candidate Maryam Abolfazli greets voters on primary election day, Aug. 1, 2024, at the Christ Church Nashville polling place in Nashville, Tennessee. Abolfazli is from Nashville and started Rise and Shine TN, a…


Jonathan Matisse/AP, file

The nonprofit, which advocates for transparency in political funding, compared Ogles’ situation to that of embattled New York Rep. George Santos, who has faced numerous investigations into his own campaign finances.

Ogles represents Tennessee’s 5th District, a Republican-leaning area that includes a portion of the liberal-leaning city of Nashville and stretches through five more conservative counties.

Although the district remains solidly Republican, the influence of Nashville’s progressive voters, combined with shifting national political dynamics, has created a potentially more competitive race than in the past.

In the 2022 election, Ogles won the seat by more than 13 percentage points, a result bolstered by the Republican-led redrawing of the state’s congressional districts after the 2020 census.

Lawmakers split Nashville into three separate districts, forcing longtime Democratic Rep. Jim Cooper into retirement and shifting the state’s congressional delegation to an overwhelming GOP majority.

Ogles’ district now includes part of the newly drawn 5th District, which spans from the Democratic stronghold of Nashville through more conservative rural counties. The redistricting was seen as a strategic move by Republicans to strengthen their hold on the state’s congressional seats.

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Ogles faces a tough challenge from Maryam Abolfazli, a Nashville-based nonprofit leader and activist.

Who is Maryam Abolfazli?

Abolfazli, the founder of Rise and Shine TN, has been a vocal advocate for stronger gun control in the wake of the tragic shooting at the Covenant School in Nashville in March 2023, which left six people dead, including three children.

Since entering Congress, Ogles has become known for his vocal opposition to the Biden administration and his alignment with the most conservative factions of the Republican Party.

Beyond his financial controversies, Ogles has faced criticism for past statements about his educational background.

After a news outlet questioned his claim of holding an international relations degree, Ogles admitted to overstating his credentials, saying he was “mistaken” about his academic history.

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Ogles, a former mayor of Maury County and state director for the conservative group Americans for Prosperity, remains a staunch defender of conservative policies.

He has filed multiple articles of impeachment against President Joe Biden and Vice President Kamala Harris, citing their administration’s policies on border security, the economy, and other issues.

Following Biden’s announcement that he would not seek reelection in 2024, Ogles introduced new articles of impeachment targeting Harris.

As the race in Tennessee’s 5th District heats up, Ogles’ ability to navigate the FBI investigation, manage his financial controversies, and hold onto his conservative base will be key to his chances of securing a second term.

This article contains additional reporting from The Associated Press

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Stock market today: Asian shares are mixed after Wall Street drifts ahead of US Election Day

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Stock market today: Asian shares are mixed after Wall Street drifts ahead of US Election Day

NEW YORK (AP) — Shares were mixed in Asia early Tuesday after U.S. stock indexes drifted lower a day ahead of the U.S. presidential election.

This week will bring various potential flashpoints, among them Election Day in the United States. But the results may not be known for some time as officials count all the votes, and that could bring sharp swings since markets hate uncertainty.

U.S. futures were virtually unchanged early Tuesday.

Adding to the potential for volatility, the Federal Reserve will also be meeting on interest rates later this week. The widespread expectation is for it to cut its main interest rate for a second straight time.

Investors also hope the Chinese government may announce stimulus for the world’s second-largest economy.

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Japan’s Nikkei 225 index gained 1.3% to 38,552.67, reopening after a holiday on Monday.

South Korea’s Kospi fell 0.7% to 2,569.75, while the S&P/ASX 200 in Australia dropped 0.6% to 8,117.30.

The Standing Committee of China’s National People’s Congress is meeting this week, and analysts say the government may endorse major spending initiatives to boost economic growth amid troubles for the country’s real-estate industry.

The official Xinhua News Agency reported that the lawmakers had reviewed legislation to raise ceilings on local government debt to replace existing hidden debts, part of a process to arrange debt swaps to help resolve the financial woes brought on by the pandemic and by a collapse in the property market in recent years.

Hong Kong’s Hang Seng was up 0.1% at 20,597.30 and the Shanghai Composite index picked up 0.4% to 3,323.26.

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On Monday, the S&P 500 slipped 0.3% to 5,712.69, remaining near its record set last month. The Dow Jones Industrial Average fell 0.6% to 41,794.60, while the Nasdaq composite slipped 0.3% to 18,179.98.

Intel fell 2.9%, and chemical producer Dow sank 2.1% in their first trading since getting notified they’ll no longer be included in the Dow Jones Industrial Average. Warren Buffett’s Berkshire Hathaway dropped 2.2% and was one of the heaviest weights on the market after reporting a drop in operating profit for the latest quarter.

But the majority of stocks within the S&P 500 rose, including a 2.8% gain for Fox after it reported a stronger profit than expected.

The hope that’s propelled U.S. stock indexes to records recently is that the U.S. economy can remain resilient and avoid a long-feared recession, in part because of the coming cuts to rates expected from the Fed.

The broad U.S. stock market has historically risen regardless of which party wins the White House. And in 2020, U.S. stocks climbed immediately after Election Day and kept going even after former President Donald Trump refused to concede and challenged the results, creating plenty of uncertainty. A large part of that rally was due to excitement about the potential for a vaccine for COVID-19, which had just shut down the global economy.

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University of Phoenix and Goalsetter Launch Financial Wellness Webinar Series

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University of Phoenix and Goalsetter Launch Financial Wellness Webinar Series

Virtual, free series features Goalsetter’s award-winning curriculum along with guest speakers to support financial wellness

PHOENIX, November 04, 2024–(BUSINESS WIRE)–University of Phoenix is pleased to announce a new webinar series with Goalsetter, an award-winning financial education platform dedicated to helping individuals and families achieve financial wellness through engaging and practical resources. The ten-part series will launch with a discussion on “Managing Credit Card Debt and Fostering Good Credit Habits,” on Tuesday, November 19, at 12 p.m. MST. Featuring Tanya Van Court, Founder and CEO of Goalsetter, Kevin Soehner, Senior VP of Operations for iGrad®, and moderated by Chris Conway, Director of Financial Literacy at University of Phoenix, the discussion will focus on building good credit habits, understanding interest rates, and how credit can impact personal finance decisions. Throughout the series, participants will gain valuable insights and practical strategies to manage their finances and plan for a secure financial future, as well as have the opportunity to engage in a Q&A session during each webinar.

“At University of Phoenix, we are committed to equipping our students with the knowledge and tools necessary for financial success,” shares Director of Financial Literacy at the University, Chris Conway. “Our collaboration with Goalsetter aligns with our mission to empower students not only in their academic and career pursuits but also in their financial lives by helping them save time and money. This webinar series is designed to provide practical strategies and insights that can help learners make informed financial decisions.”

Each month during the series, University of Phoenix and Goalsetter will offer webinars focused on key strategies for financial wellness:

  • November: Managing Credit Card Debt and Fostering Good Credit Habits

  • December: Paying for School and Scholarships

  • January: The Art and Science of Effective Budgeting

  • February: Stop Overspending: 5 Tips

  • March: Yes! You Can Save Money: Little Actions that Add Up

  • April: Emergency Funds are Critical; How to Create Them, Even If You Think You Canʼt

  • May: Why Credit Scores are Important and How to Improve Them

  • June: How to Plan for Your Eventual Retirement

  • July: Investing in Your Families’ Future

  • August: How to Set Your Kids Up for Future Financial Success

“Our mission is to empower every individual with the financial knowledge they need to secure a strong financial future,” says Van Court. “By working with the University of Phoenix, we are bringing our award-winning financial education tools to a larger audience, helping individuals and families gain the practical skills to make informed financial choices. Together, we aim to create a pathway toward financial freedom that’s accessible, engaging, and transformative.”

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