Reducing methane is humanity’s biggest hope to affect the climate in the coming decades. With the agricultural sector taking the literal and proverbial heat as the largest contributor of methane emissions in the US, there is an exciting opportunity to explore and invest in plant-based innovation as a solution to reducing the damaging greenhouse gas.
Contributing to 30% of global warming since pre-industrial times, methane is a potent greenhouse gas impacting temperatures, climate systems, and human health, leading to 1 million premature deaths each year, asthma-related hospital visits, and major crop losses of wheat, soybeans, maize, and rice. In New York State, methane is the second most prevalent greenhouse gas according to the NY Department of Environmental Conservation.
In response, the US Environmental Protection Agency and state agencies have issued stricter regulations regarding methane emissions, especially from the oil and gas industry. While important steps forward, work must be done in every contributing sector, especially the agricultural sector, the greatest contributor of methane gasses in the US.
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From 1990 to 2020, although the US exhibited a decrease in emissions from landfills, coal mining, and natural gas and petroleum systems, there was actually an uptick in emissions associated with agricultural activities.
To fully combat methane emissions, we need both response and prevention measures. Paired with regulations and technological developments to reduce emissions in the oil and gas industries, we need advancements to mitigate emissions by avoiding creating them all together. We need to invest in technology and food systems that have the potential to curb methane emissions at the start.
Multiple studies have highlighted the link between food consumption and emissions, with a 2009 report finding that reducing beef consumption alone by approximately 50% by 2050 would result in a methane emissions reduction of about 14 million tonnes per year based on consumption patterns at the time. More recently, in January 2020, University of Michigan’s Center for Sustainable Systems published Implications of Future US Diet Scenarios on Greenhouse Gas Emissions, finding that reducing meat consumption by 50% and replacing animal-based products with plant-based alternatives would “reduce per capita emissions from the diet by 35% of the status quo baseline.”
With the recent uptick in new technologies, research, and plant-based products, an exciting investment opportunity propelling forward a global food systems shift has become abundantly clearer.
Innovating for change, Beyond Meat, MorningStar Farms, and Oatly’s Life Cycle Analyses demonstrate lower environmental impacts compared with their traditional, animal-based counterparts, with Beyond Meat exhibiting “90% less greenhouse gas emissions” and MorningStar Farms veggie products, up to a 90% reduction of environmental impacts across the product life cycle.
It is important to note that consumer packaged goods companies are not the only ones ushering in needed and exciting change. Up and down the supply chain, small-, medium- and large-cap companies are also modifying their B2B models to reduce their carbon footprints and practice better planetary stewardship. Ingredient company, Ingredion, for example, has invested more than $250m in its plant-based proteins portfolio to not only help companies reduce their carbon footprints and achieve their sustainability goals without compromising nutrition, taste, or texture, but better align with consumer preferences.
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Plant-based innovation is a powerful impact investment tool. In 2022, Boston Consulting Group’s study, The Untapped Climate Opportunity in Alternative Proteins, reported that investing in plant-based innovation and alternative proteins is three to 40 times more impactful in reducing greenhouse gas emissions than investing in other green sectors, including electric vehicles and alternative building materials.
With increasing conversations on plant-based innovations’ unmatched capabilities to reduce greenhouse gas emissions, plant-based innovations are continuously cementing their place in the future of food and the market. As an impact investor or an investor seeking growth in a mega-trend, you have the opportunity to be part of this change and cement your place in the great food systems shift.
Elysabeth Alfano is the CEO of VegTech Invest, advisory to the VegTech Plant-based Innovation & Climate ETF, EATV. She is also the CEO of Plant Powered Consulting and host of The Plantbased Business Hour.
Bella T. Fong is a recent graduate and equity, sustainability, and animal welfare researcher.