If there are any lingering doubts that solar, wind, hydro, and biofuels, represent the future of the energy industry, this should dispel them: the infamous Goldman Sachs plans to invest $40 billion in these and other clean energy sources over the next 10 years.
Given the bank’s scandalous history of risky lending, fraud, and government manipulation, it’s hard to believe that the decision comes from a sudden sense of altruism toward the planet or guilt over the oil and gas industry’s exploitative practices. Instead, it’s a move driven purely by the quest for profit, or what Goldman Sachs calls an “emerging opportunity we think will be quite large.”
This should serve as a wake up call to those in both government and private industry who claim that alternative energy will never be as practical and affordable as fossil fuels. Goldman executives are confident that demand for alternative energy sources will grow with global energy demand, and as big manufacturing countries, including China and Brazil, set more aggressive targets for reducing emissions. According to Reuters, the bank plans to finance deals with clients’ money and, to a lesser extent, its own funds.
Still, at an average of $4 billion a year over 10 years, the bank’s newest round of clean energy investments will be about $800 million less than it helped finance in 2011. Some have claimed that Goldman Sach’s latest announcement is nothing more than a publicity stunt meant to draw attention away from the negative press experienced recently. Most notably, a former employee wrote a scathing opinion piece in the New York Times in March accusing Goldman of ripping off its clients on a regular basis.