4 climate tech investors sound off on Supreme Court’s EPA ruling

climate, cop26, climate change

This week’s Supreme Court decision to curtail the Environmental Protection Agency’s ability to regulate greenhouse gas emissions may not have been unexpected, but it was still a bombshell. Not only did it kill the prospect of quick executive action on the matter, it potentially cut off a number of regulatory solutions.

The EPA had sought to rein in carbon emissions first through the Obama-era Clean Power Plan, which had been shelved after court losses, and then through Biden administration regulations. The two Democratic administrations relied on part of the Clean Air Act that authorized the EPA administrator to use their judgment to produce a list of stationary pollution sources “which may reasonably be anticipated to endanger public health or welfare.”

Carbon emissions certainly deserve to be on the list, with climate change expected to cause nearly 5 million excess deaths annually by 2100.

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Now, if anything is to be done on the matter, the court said that Congress must explicitly authorize it. Given the current state of Congress, climate legislation isn’t impossible, but it’s also not very probable.

Until that happens, the U.S. is going to become increasingly reliant on the private sector to provide climate-oriented solutions that not only limit carbon pollution but also give the country a chance at remaining competitive in a world that’s quickly moving away from fossil fuels.

“This is a race we cannot afford to lose, yet the Supreme Court has just tied weights to our feet.” Peter Davidson, CEO, Aligned Climate Capital

The good news is that the climate tech sector has become a hotbed of activity in the past few years, drawing tens of billions in investment. Despite a dearth of government action in the U.S., investors have remained bullish, in part because of the sector’s enormous potential. By 2025, climate tech could draw up to $2 trillion in investments annually by 2025, according to McKinsey.

The Supreme Court’s decision threatens to pour cold water on that, of course. While it may have tempered some enthusiasm in the short term, three climate tech investors remain optimistic that opportunity still exists and that the private sector can deliver results.

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