Al Gore's Climate Fund Secures $175M from Microsoft and CalSTRS

The Underinvestment in Nature-Based Climate Solutions

A significant majority of climate-related investments have historically been directed towards companies operating within the energy and transportation sectors. Consequently, nature-based solutions – such as initiatives focused on biodiversity – are frequently undervalued and receive comparatively little investment attention.

In 2022, only $35 billion was allocated to nature-based solutions, a stark contrast to the $1.46 trillion invested across the broader climate finance landscape.

Just Climate's New Funding

Recognizing this disparity, Just Climate has secured $175 million in funding. This capital comes from both Microsoft’s Climate Innovation Fund and CalSTRS, a major pension fund.

Just Climate originated as an extension of Al Gore’s Generation Investment Management. Previously, its investment strategy centered on industrial climate solutions, aligning with the approach of many other private climate technology investors.

Focus on Natural Climate Solutions

This new fund represents a strategic shift, concentrating on natural climate solutions. These solutions encompass a wide range of practices, including sustainable farming and responsible forestry.

Nature-based approaches target greenhouse gas emissions originating from agriculture, forestry, and land-use change. Collectively, these sectors contribute approximately 15% of global annual emissions.

Carbon Removal and Reforestation

Beyond reducing emissions, nature-based solutions can actively remove existing carbon dioxide from the atmosphere. Reforestation initiatives, for instance, involve planting trees on previously degraded land, effectively storing carbon within the wood.

Microsoft has recently demonstrated its commitment to this approach through an investment in Chestnut Carbon, a startup specializing in reforestation projects.

Restoring Biodiversity and Reducing Emissions

The fund’s primary objective is to restore natural ecosystems, simultaneously addressing both biodiversity loss and emissions stemming from land use practices.

Potential investment areas include biological fertilizers and pesticides, platforms dedicated to restoration finance, and technologies designed to verify both carbon reduction and biodiversity protection.

NatureMetrics: A First Investment

Just Climate’s inaugural investment, completed in January, involved leading a Series B funding round for NatureMetrics. This company assesses site biodiversity by analyzing environmental DNA (eDNA).

eDNA, found in water or soil samples, provides a comprehensive picture of the species present in a given location.