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28 Feb 20
How low can you go? Achieving a Low Carbon future
If you’ve taken any notice of the news in recent months, you will be aware of climate change. Already, in early 2020, climate change has contributed to devastating bushfires in Australia. Last year in the UK, we recorded our hottest day according the Met Office. It recorded an all-time daily temperature of 37.7C (101.7F) on Thursday the 25th July. The Met Office also confirmed that the UK’s 10 hottest years have occurred since 2002. This can be attributed to the amount of carbon dioxide in the atmosphere.
How does this relate to me?
The average person in the UK directly emits 10 tonnes of carbon dioxide per year. This is broken down by 5.7 tonnes from transport; how we go about our weekly tasks, travelling to work, getting the shopping in, flying away on holiday. A further 2.7 tonnes from heating with natural gas; making sure we are comfortable during winter in our homes. And an additional 1.6 tonnes from electricity usage in the home; watching our favourite TV shows, surfing the net, lighting our homes.
What can you do to reduce your personal carbon footprint?
Looking at electricity usage first, switching to a 100% renewable provider can be done today. There is an ever increasing choice of these providers and often it can be done for the same pricing tariffs. This will save 1.4 tonnes off your carbon footprint.
As to your heating usage, making sure your home is properly insulated can save a further 0.5 tonnes of carbon emissions, and although it may cost initially, the savings in heating costs will offset that in the future.
The transport aspect may be a little more long term, but switching to an electric vehicle, having your weekly shopping delivered, taking less airline flights will also save a significant amount of carbon emissions. Within our working life, using technology can be easily implemented, by using apps such as Skype instead of traveling to meetings, if possible being able to work from home rather than commuting to an office.
How can this also relate to your investment strategy?
There is also another way to reduce your carbon footprint and it’s something you can do in conjunction with your financial adviser. You can assess and alter your investment strategy. Start by looking at your current savings and investments to ascertain which funds they are invested in.
Do these funds invest in companies that provide solutions to the climate problem? There are an array of funds which look to identify companies that are providing wind turbines for cleaner energy, companies that provide thermal insulation which helps cut the amount of energy to heat the building we work and live in, just to name two examples of investments that can have an effect on carbon reduction. As these companies are in sectors that are increasingly more in demand, the share prices reflect this and the returns can be just as good or better than other ‘traditional’ sectors.
If you go through this process with your financial adviser, you might be surprised that by making a few investment strategy changes, you can avoid harmful practises, provide solutions to the carbon problem and make money at the same time.
This is not a personal recommendation to invest in companies