5 insights from MaRS Climate Impact

More than 100 speakers shared the latest ideas and innovations to address the growing threat from climate change.

Hot on the heels of COP27, this year’s MaRS Climate Impact brought together a diverse network of investors, experts and entrepreneurs to discuss the dire reality of the climate crisis. Out of the many solutions and ideas that emerged, there was broad consensus on two points: there’s no pathway to net zero without technology, and there’s no pathway without policy and regulation. But is it too late? The catastrophic changes occurring seemingly daily haven’t yet prompted radical change. If we’re really serious about the climate, it’s time to focus.

Here are five takeaways from the conference:

Ethical consumerism is not going to fix the climate crisis

What will have a greater impact: regulating greenhouse gases or regulating dollars? Jessica Green, a professor of political science at the University of Toronto, argues that we need to follow the money. There is an obvious correlation between wealth and emissions — the richest 10 percent of the population account for 52 percent of global emissions. And roughly half a trillion tax dollars is lost to multinational corporations offshoring their profits every year. That’s where Green sees opportunity. While travelling less, buying an electric car and cutting down on food waste are important steps for people to take, these small individual decisions aren’t enough to create a sustainable economy. Taxation of the rich and corporate tax reform are more effective ways to capture lost dollars for reinvestment in the climate economy. “We have to shift the focus to more systemic changes through policy and investment,” Green says. The opportunity to kickstart the renewable economy does exist, and policy is the pathway.

The critical question: What are the key policies we can use to decarbonize and find our place in the global economy in a post fossil fuel world?

Heated Debate: Offsets are a license to greenwash

The votes are in and our experts agree: carbon offsets have been used for short-term benefits. Sure, offsets are good in theory; they encourage a higher amount of pollution reduction for the same amount of money. In practice, however, there’s been a lot of bold promises and a continued increase in emissions. For years, the carbon offset market has been marred by dodgy practices, such as offsetting reductions that would have happened even without the carbon market or don’t provide lasting benefits to the environment. But additionality and permanence are becoming bigger priorities. With big financial players coming in and new third-party validation tools, carbon markets are gaining ground. The true test will be in the response to the regulatory market. If the price of real offsets — with measurable and permanent sequestration — shoots sky high, we’ll quickly see how serious the players really are.

The bottom line: Without a heavy dose of quality control, the offset market scores an F.

The world needs a radical new diet

With the current rate of growth, a forecasted world population of 10 billion people is not off the table. But if we continue on this trajectory without changing our food system? We’re in trouble. The green revolution, which radically increased crop yields after the Second World War, effectively allowed us to keep up with our growing population. But it also inadvertently created an unsustainable food system, with a whopping 38 percent of the earth’s surface now dedicated to growing crops. Technology can only take us so far — Western countries have an obligation to make radical changes. The world can support a lot more people who live off less energy-intensive crops. Regenerative agriculture needs to be top priority, with a focus on local, sustainable practices. It should not be an over-developed technological landscape.

Talking point: “The future is already here, it’s just unequally distributed,” says Marcius Extavour, chief scientist and executive vice president of energy and climate at the XPRIZE Foundation.

The “waste wardrobe” is trending

The fashion industry is no stranger to scrutiny — for good reason. With increasing pressures to hit ESG targets, large corporations are looking for ways to get rid of waste sustainably. Climate investors are also increasingly seeking circular economy models. But how do we convince the consumer to make a change? Turns out, you don’t need to. Myra Arshad of ALT TEX has developed a method for transforming food waste into a polyester-alternative polymer that integrates directly into the textile supply chain. Using the same manufacturers retailers are currently using, ALX TEX reduces supply chain friction companies would face in seeking and adapting new materials. Whether it’s an apple t-shirt or orange peel pants, today’s lunch has the potential to be tomorrow’s attire.

Bonus point: This solution also provides supply chain stability.

Not all VCs are created equally

Vinod Khosla of Khosla Ventures is not your typical venture capitalist. In fact, he prefers the title venture assistant, to underscore the mentorship and advice he provides. When recruiting portfolio companies, he values large impact over large returns. Short-term goals with uneconomic technologies are not going to help us hit targets, and rushing these goals for returns in 2030 is ill-advised. Khosla’s advice: focus. To move the needle, we need to concentrate the funding on research and development, as well as early deployment of risky, hard-technologies. According to the VC (or VA), there are 12 critical areas in need of deep technical breakthroughs — and these hard breakthroughs are what climate investing is about.

The 12 focus areas: EVs, plant proteins, aviation, shipping, cement, steel, fertilizer, grid storage, electricity, hydrogen, water and direct air capture.

Want to learn more about what it will take to build a sustainable and prosperous planet? Meet the new cohort of Mission from MaRS Climate Champions.