Humans have such a complicated relationship with “first.”
We remember the first people to set foot on the moon, the first runner to step across the finish line, and in business, the first company to dominate a market.
Nobody wants to be anything other than first…
…until the time comes to take the first step. Then you realize how many incentives in life and in business reward those who wait. If you don’t know how deep the water is, you don’t want to be the first to jump. If you’re a seller, it’s far easier to capitalize on an existing market than it is to create a new one. If you’re a buyer, early adopters pay a premium to be the first when it comes to new technologies. They pay more for a less mature product.
Why take on all the risk to be the “first” when second or third is much safer — and cheaper?
Climate change upends traditional risk assessment
Our complicated relationship with being first — the never-ending push and pull between risk and reward — has been our story for as long as we’ve had stories to tell. It tends to compress huge swaths of history into moments of apparently rapid change, eliding decades or centuries of delaying and hedging in favor of a narrative of bold action.
But at this moment in time, we don’t have the choice to delay or hedge. Our species has every incentive to act faster and on a greater scale than ever before. Unfortunately, the personal and corporate incentives haven’t changed.
So we have to change them.
Patch has joined First Movers Coalition
Altering incentives is what the First Movers Coalition (FMC) is all about.
It’s an international group of more than 60 companies who are done waiting for all the incentives to align before making an impact. Through commitments to support clean but nascent technology, they’re changing the incentives to spur more action from the rest of the marketplace. FMC is organized by the World Economic Forum and the U.S. State Department, and we’ve joined as an Implementation Partner.
FMC companies include huge multinationals like Alphabet and Microsoft with serious amounts of money to move markets — we’re talking ~$8 trillion in market cap altogether.
So, what are all of these companies actually going to do?
FMC is starting with a goal of decarbonizing seven industrial sectors that are “hard to abate”: Aluminum, Aviation, Chemicals, Concrete, Shipping, Steel, and Trucking. Those industries make up 30% of global greenhouse gas emissions.
The reason these industries can be described as hard to abate has everything to do with the incentives we discussed. These industries are not decarbonizing nearly fast enough if we’re going to stay below 1.5-degrees of global warming. Low-carbon technologies are simply not competitive with the current status quo powering these sectors. Most companies don’t want to assume the risks or pay the costs — yet.
How First Movers Coalition is taking action
Many FMC member companies have pledged to drive the incentives in the right direction by investing in low-carbon and carbon dioxide removal (CDR) technologies with the goal of commercializing them rapidly. Each company will contract 50,000 tonnes (or $25 million worth) of durable and scalable CDR by 2030.
With that magnitude of investment, we can more quickly drive forward efficacy and drive down costs.
That’s where Patch can help.
Our technology and marketplace are designed to make investing in durable and scalable carbon removal technologies as accessible and transparent as possible. Companies can use our infrastructure to purchase vetted carbon credits through a variety of pathways, including one-time direct purchases or multi-year offtakes. Our API will help companies make any software experience a climate action opportunity.
With Patch, FMC will be able to reduce the operational friction of the investment. We’ll also return market feedback and insights faster to help make the most of it as well.
Aligning planetary incentives to corporate incentives
Our planet needs all of us to be “first movers” when it comes to both decarbonization and removing carbon dioxide from the atmosphere. Unfortunately, most companies in hard-to-abate industries are being driven by market incentives, not planetary ones.
FMC has the financial ability to push on the market incentives until they’re aligned to the planetary ones — and we’re excited to help them do it faster.
You don’t have to be a member of the First Movers Coalition to have a “first” mentality. Companies of any size and scale have the ability to take action to both decarbonize and invest in pushing incentives into alignment with the climate through carbon credits.
I’d encourage you to get started by exploring Patch today.