How can AI unlock climate-smart investing?

One company uses AI-powered analysis to demonstrate the potential financial impact of the climate crisis on specific areas

Spotted: Comprehensive research has demonstrated that human-induced climate change is increasing the severity and prevalence of extreme weather events, from heatwaves and torrential rainstorms to hurricanes. When and where this extreme weather will occur is difficult to track, particularly for the average person who doesn’t have easy access to the necessary scientific data. This is particularly a concern for those wondering how to plan and grow their assets, with people wary of how they should invest in an increasingly volatile environment. This is where Climate Alpha comes in. 

The platform uses climate models, data science, and spatial finance to provide investors with essential knowledge to help them invest in climate-resilient assets. Public and private data streams are analysed with the company’s proprietary machine learning algorithms to produce forecasts of risks and the potential financial impact of climate change on a client’s portfolio. Crucially, the assessments take into account separate socioeconomic factors and market variables to calculate risk more broadly beyond the physical threats of climate change. 

Climate Alpha’s technology is helpful across a number of use cases, be it investment, loaning, or real estate acquisition. And beyond large-scale corporate finance, Climate Alpha also offers a “Homes” scheme that allows individual homeowners and buyers to understand the best time to sell a property, or identify any climate-related risks associated with a house before they buy.  

Climate Alpha recently raised $5 million (around €4.6 million) in seed funding and will be using the funding to expand its teams. 

Planning for an increasingly unpredictable and unstable climate is extremely difficult without the right insights. Springwise has spotted other innovators looking to help fill that knowledge gap, through the use of satellites and live modelling for flood risks. 

Written By: Archie Cox