How Money and the Market Can Sustain Sustainability
This Q&A is part of an initiative by the communications team at the Earth Institute’s Advanced Consortium on Cooperation, Conflict, and Complexity to highlight the work of practitioners, community members, and academics working on sustainability.
Cross-sector partnerships on environmental sustainability are sweeping across the globe as diverse agencies are syncing with the finance sector to scale up their sustainability plans. Particularly, private investment is one way to obtain strong financial returns while generating policy change. Through the work and perspectives of Andy Darrell, we can understand these intersections of private investment and environmental sustainability in New York and nationwide.
Darrell is the New York regional director and chief of Strategy, Global Energy and Finance at the Environmental Defense Fund (EDF). Guided by science and economics, EDF is a nonprofit environmental advocacy group that finds practical and lasting solutions to the most serious environmental problems. Additionally, Darrell is a member of New York City’s Sustainability Advisory Board, beginning under Mayor Michael Bloomberg and continuing in that role with Mayor Bill de Blasio. Darrell helps promote the global transition to clean energy by leveraging the interests of investors, communities, and local government.
You’ve been involved in environmental projects for more than a decade. What was the impetus for your involvement?
Previously, I was a lawyer and worked on Wall Street, and I left because I wanted to bring my skills to the environmental sector. As someone who likes the outdoors and nature, I was naturally inclined to commit to environmental sustainability. While living in New York City, I saw the potential for large-scale sustainable impact. NYC is one of the most urbanized cities in the world, yet it now consumes less energy per capita than any other city. Being in NYC gave me hope for using economics to engineer the future in a sustainable way. I see the finance sector, including private investment, as a potent way in which capitalism and the free markets can deliver a healthy environment.
Often private investment has been cast with suspicion, as it often feeds into corporate partnerships. How can private investment mobilize the public to respond to climate change?
The system isn’t currently fair; rules aren’t enough to enforce regulations to mitigate climate change. Market forces can be very powerful to deliver change. I see private investment as a drive for innovations in affordable energy consumption, such as solar panels. I want to help people see that a clean, healthy future is one they can thrive on as well.
For example, in New York City, there were 8,000 buildings that were still burning heavy, highly polluting bunker fuels. Switching out to cleaner and more energy efficient alternatives would require major capital investments. To resolve the financial impasse, I went to Wall Street and helped raise money so companies can afford to pay engineers and invest in greener alternatives.
How can private investment best collaborate with non-profits, education, and government entities?
Transition to green energy will require trillions of dollars in investment. Collaboration is necessary because the government by itself will not be enough. We need further collaboration to create larger-scale changes. This is not as much about the private/public sector but just humans working towards a common good in general. This work requires every skill set and we need everyone. Find something that you love to do and orient it towards this: think green. One great example of public-private collaboration is Green Bank [a state-sponsored, specialized financial entity working with the private sector to increase investments into New York’s clean energy markets, creating a more efficient, reliable and sustainable energy system].
Speaking of government-sponsored changes, what were some of the challenges and successes you’ve experienced while being a part of New York City’s Sustainability Advisory Board?
We have made significant changes. However, there was a lot of inertia in the beginning, which was expected. When the city decided to set environmental regulations, clear goals were not set. However, when economic forces converge with environmental goals, practical solutions happen. Some of the things we accomplished included the bicycle sharing system [Citi Bike is a public-private partnership between the City of New York and Lyft Bikes, a private company],
and the clean heat program [which provided free resources to buildings to help them convert to cleaner heating fuel in the most cost-effective and efficient way]. We achieved a 65 percent reduction in pollution from heating. Additionally, we recently obtained approval for the congestion pricing policy proposal. We have also added more parks on the waterfront and planted more trees.
As a member of New York City’s Sustainability Advisory Board, you’re a staunch advocate for congestion pricing policy. This year, New York approved a plan to implement congestion pricing for 2021, affecting areas in Brooklyn, Queens, the Bronx, and northern Manhattan. What are your opinions on the synchronization of sustainability and transportation?
This program seeks to reduce carbon emissions by charging drivers to enter heavy traffic zones.
The board successfully gained approval from the politicians by engaging ordinary citizens in the process. We went to local subways and asked riders to call their representatives to demand congestion pricing. After receiving hundreds of calls, the politicians finally yielded. Such an accomplishment underscores the potency of combining policy change and investment to deliver sustainable alternatives.
We are in the planning phase. We need a billion dollars in investment into the transit system. Investment in the transit system has led to a reduction of traffic by 20 percent in major cities such as London and Stockholm. For years, the decline in ridership was due to issues like reliability and timing, but the system still carries around 5 million people daily. Furthermore, about $500 million in annual revenue will be invested in improving transit expansion. I believe that with better infrastructure and more reliable systems, ridership will increase.
Today, demand for a sustainable future is ubiquitous, from youth movements across the globe to international conferences. From Darrell’s perspectives, we learned that philanthropic and private actors can work together in tangible ways to dramatically scale-up towards a more sustainable future.
Thuy Hang Tran is a communications intern in the Earth Institute’s Advanced Consortium on Cooperation, Conflict, and Complexity.