The green economic transition must also be a just one, one that combats both climate change and inequality.
Boosting the participation of people of African descent in the energy sector improves both equality and bottom lines, and accelerates the adoption of cleantech
The business community is showing increased interest in diversifying investments and incorporating race considerations into their business models
There is a small but growing community of Black-founded and run cleantech companies that are tackling energy inequality and climate change
Diversification is a key part of the cleantech sector; whether it’s diversifying investor portfolios, diversifying our energy mixes, or diversifying how we access and use energy
Diversity also needs to be a core feature of the cleantech workforce. Businesses and recruiters need to help ensure the cleantech transition is a just one. As things stand today, the energy sector remains predominantly White and male, with women and people of colour — particularly African-Americans — underrepresented.
More obviously needs to be done to encourage and support Black and female participation in the cleantech sector. This is particularly important because failing to do so risks leaving whole segments of society behind as the economy transitions. As a 2021 report by advocacy groups — including the American Association of Blacks in Energy (AABE) argues:
“Given the incredible job growth of the energy sector over the past decade, this lack of diversity threatens to cause women and Black workers to miss out on one of America’s great economic expansions.”
To this end, organizations like the Urban Energy Justice Lab at the University of Michigan are helping propel the discussion around race in the energy sector. Founded in 2015, the lab is run by assistant professor, and senior advisor on energy justice at the Department of Energy, Dr. Tony G. Reames. And then there is Green For All which deals with the intersection of environmental, economic, and racial justice movements. Green For All is a component of the Dream Corps founded by CNN host and media personality, Van Jones.
Cleantech needs to close the diversity gap
Energy programs that use a one-size-fits-all approach are only part of a larger dearth of diversity at all stages of the cleantech process — from energy users to workers to investors. In the United States, women account for only 27% of the cleantech workforce, despite numbering more than half of the population. Similarly, only 8% of cleantech jobs are filled by Black workers, despite African-Americans accounting for 13% of the US population.
“Having a workforce that reflects the community you’re trying to operate in is always going to help you be more successful,” says Paula Glover, president of the Alliance to Save Energy and former CEO of the AABE.
The lack of Black voices is even more noticeable when it comes to funding; only about 3-4% of venture capitalists are Black, and only around 1% of venture-backed founders are Black. And while news that funding for Black entrepreneurs quadrupled to $1.8 billion in the first half of 2021 (compared to the same period in 2020) is encouraging, Black founders still garnered a mere 1.2% of total venture funding in the US last year.
Is 2022 the tipping point for boosting Black representation in cleantech?
Fortunately, despite the disparities we’ve already outlined, there are signs that the cleantech community and investors are paying more attention to diversity, and 2022 could well become the best year for investment in Black startups in history. Charley Moore (himself African-American), the CEO and founder of Rocket Lawyer is hopeful, telling Crunchbase that “I haven’t seen this amount of interest and conversation in the business community at large about race since the anti-Apartheid movement in the ‘90s.”
There is a small but growing cohort of Black-founded and run cleantech businesses, many of them founded by Black women. One of these is Shyft Power Solutions which has offices in San Francisco and Lagos, Nigeria. Shyft focuses on the Internet of Things (IoT) and integrated software to optimize distributed energy resources and improve performance and efficiency. The company was created by founder and CEO Ugwem I. Eneyo, a Forbes 30 Under 30 pick and Stanford engineering PhD.
Another example is WeSolar, which was founded on Juneteenth, 2020 in Baltimore by CEO Kristal Hansley. WeSolar works to provide affordable access to community solar projects to underserved communities. And Volt Energy, founded in 2010 by Gilbert Campbell and Antonio Francis develops, finances, builds solar projects with clients ranging from Accenture to the US Army.
Ensuring that all segments of society benefit from the green economic paradigm shift is vital if we wish to reduce energy inequality in all forms.
Other enterprising Black cleantech leaders include Uncharted CEO, founder, and Harvard Business school graduate Jessica O. Matthews, whose company works on last-mile problem solving with a focus on IoT, smart city integration, energy resiliency and energy savings. Then there is COI Energy, which was founded by SaLisa Berrien and went live in 2020. The company was the recipient of $100,000 from Google’s Black Founders Fund and now serves 14 states and DC. COI’s energy-saving B2B platform uses artificial intelligence and machine learning to predict businesses’ upcoming utility bills and encourage ways to lower costs.
Ensuring that all segments of society benefit from the green economic paradigm shift is vital if we wish to reduce energy inequality in all forms. A business community and workforce that better reflects the overall population is not only good for business but lets more of us access the cleantech solutions we need to combat climate change together.
To realize this goal, cleantech leaders and businesses must build diversity and inclusion into every aspect of their organization. Just as sustainability must be an intrinsic tenet in an organization’s culture for actual change to occur, so too must diversity be enshrined at all levels — starting with the recruitment process — for it to truly manifest in a company.