At first glance, the energy transition is a titanic undertaking. There is no point in denying it: protecting the planet in the face of the threat posed by climate change requires enormous capital investment, in order to change from within the way companies, states and individuals operate. But there is good news: the mission is possible, both technologically and economically. Indeed, economically it represents a gigantic business opportunity. This is demonstrated by the report "From Risk to Return. Investing in a Clean Energy Economy" by the Risky Business Project, which is based on analyses conducted by the World Resources Institute.

Climate change? An unacceptable risk

As far back as a 2014 report, the Risky Business Project had estimated the economic risks that climate change, if not properly contained, will pose for US companies and their investors. It reached a clear conclusion: these are excessive and unacceptable risks. We are talking about extreme weather events, heatwaves, droughts, rising sea levels and so on. To reverse this trend, the United States (and, like them, other advanced economies) will need to reduce their greenhouse gas emissions by at least 80 per cent by 2050. The energy transition — that is, the shift from coal and oil to renewable energy — is therefore an obligatory choice.

Costs and returns of the energy transition

The energy transition, however, comes at a cost. The report goes as far as putting figures on this for the United States, and they are very substantial: 220 billion dollars a year from 2020 to 2030, rising to 410 billion in the decade 2030–2040 and to 360 billion between 2040 and 2050. Investment would need to focus above all on energy generation, biofuels, next-generation light vehicles and energy efficiency. But every investment also brings a return. And, in this case, it is worth it. The energy transition also entails a cut in spending on fossil fuels: from 2020 onwards the US would save 65 billion dollars a year, and from 2040 as much as 700 billion dollars a year. Not to mention jobs: clean energy is capable of creating one million jobs, especially in the construction and utilities sectors. What's more, no miracles are required at a technical level: we already have all the necessary technologies at our disposal.

If Trump doesn't believe in it, we must look to companies

At this point, the challenge would be to convince Donald Trump, who during the election campaign repeatedly expressed strong doubts about the validity of global warming theories — shared by 97.1 per cent of scientists worldwide — and who, in his first week as President of the United States, gave the green light to the resumption of construction of the Keystone XL and Dakota Access pipelines. A clear and bold legislative framework in favour of the energy transition — the report underlines — is indeed essential to put private actors in a position to change course.

For their part, companies can — and must — do a great deal. First and foremost, they should carry out a detailed analysis of the risks that climate change poses across their entire supply chain, in order to know exactly where to intervene to cut emissions. They will then need to communicate what they are doing clearly, both to authorities and to investors, who are increasingly demonstrating their attention to environmental, social and governance issues.

What investors can do

A fundamental impetus to action can come from investors, who now have the means to measure the environmental impact of their investment portfolio and to act accordingly. How? The first step is direct engagement with companies, which may take the form of soft engagement when it is simply a dialogue, and of hard engagement when it involves intervention at the shareholders' meeting. Over the years, many investors have chosen to move from words to deeds, divesting from companies operating in the fossil fuel sector; in some cases, the same capital is reinvested in other companies that support the energy transition (as proposed by the Divest-Invest campaign).