Venture partner Susan Su explains the legal implications of Gulf sovereign wealth funds potentially pausing financial commitments during regional conflict.
Assertion Supported
Su: FT reported major Gulf economies reviewed invoking force majeure on commitments
“In early March, the Financial Times reported that the three of the four major Gulf economies were collectively Doing an internal review of whether they could invoke force majeure on their financial commitments.”
Insight
Su: Energy history consists of additions, not replacements of fossil fuels
“In all of history, we've never really had a true energy transition. We've just had energy additions, and the president of the S&P, and also awesome fossil fuel historian and energy thinker, Daniel Yergin, Says this a lot, right? Like we've only ever had additi…”
Assertion Partly supported
Su: Captive coal plants supply 60% of energy for Chinese solar manufacturing
“So it's kind of like you know, behind the meter for coal for a solar facility. So it's accounting for, I've seen some estimates, accounting for 60% of the energy used to produce these solar panels.”
Opinion
Su: Climate tech models assuming €100 carbon prices carry major political risk
“If you're building, I don't know if you're a crazy person, and you're unfortunately building a DAC company right now, or Green Steel, and your revenue model assumed a 100 euro per ton carbon price in perpetuity, You're taking on political risk whether you ackn…”
Opinion
Su: Window for quick return to normal Gulf capital flows has passed
“Obviously short contained conflicts tend to see repatriation for a few quarters, but then, like, resume business as usual, but honestly, Lara, I think that ship has sailed.”
Assertion Not checkable as stated
Su: Weak 2021 returns leave climate GPs struggling to raise follow-on funds
“So LPs who wrote checks into climate funds in 2021 or 22 to 22 are looking at kind of a lack of returns that don't necessarily support re-ups today, which means that subsequently a lot of climate GPs, not all, but a lot, are then struggling to go out and raise…”