This is another no-brainer.
Recently, colleges and universities have been earning an average 6–8% return on their endowment funds. Most facilities projects to reduce energy & greenhouse gas emissions [GHG] have a 5–7 year payback — a 14%–20% return—which means colleges & universities could reduce energy expenses and increase endowment earnings just by investing in these projects!
Look at the information from the Sustainable Endowments Institute and the Billion Dollar Green Challenge and you’ll see that a few projects might take 10–12 years (still a solid 8–10% return), but some will pay for themselves in only 1–2 years, for an ROI of 50–100%! (Some projects actually pay for themselves in 6 months, for a return of 200%!) For a small college, planning and implementing major energy-related retrofits and improvements might cost about $10-million and lead to energy savings in the range of $1–2-million every year. (On larger campuses, of course, both the investment and the payback are proportionately greater!)
In addition to these major facilities projects, endowment funds can be used to create or enhance a ‘Green Revolving Fund’, another proven high-return investment with almost no risk.base
And it’s important to note that investment in fossil fuels & other carbon-based industry is investment in the ‘carbon bubble’. Those who don’t divest before the bubble bursts will bear the worst losses.
Return to Open Letter to College Presidents & Trustees
- Green Revolving Funds
- Endowment Investments with High Return & Ultra-Low Risk
- Commitment to Leadership in Campus Sustainability