Impact Fund Annual Report 


As carbon credits mobilize finance for climate action projects, purchasing them is a way to go beyond set ambitions. Carbon removal credits, for instance, support nature-based removal initiatives like afforestation, soil carbon sequestration, and wetland restoration. They also bolster technology-based projects like carbon capture and storage (BECCS) and Direct Air Capture with Carbon Storage (DACCS).  

Avoidance and reduction projects avoid or reduce CO2 emissions via a variety of measures. Replacing coal plant electricity generation with a more renewable option, or providing more efficient cookstoves to developing communities, both generate these types of credits. Companies that purchase these credits can claim that they are compensating for residual or difficult to abate emissions. These environmental, economic, and social benefits, in part, are driving the voluntary carbon market toward massive growth. Mark Carney, the UN's Special Envoy for Climate Action and one of the people responsible for launching the Taskforce on Scaling Voluntary Carbon Markets, estimated in October 2021 that this market could be worth 150 billion USD by 2023.

To reiterate, companies cannot use carbon credits and then return to business as usual. Taking meaningful action means making tangible changes to directly reduce value chain emissions. When internal reduction initiatives and private sector climate finance combine, though, that is where you get lasting contributions to the shared global ambition of solving the climate crisis.

Investing in lasting impact 

Purchasing carbon credits, whether avoidance, reduction, or removal, helps you compensate and neutralize residual emissions, while supporting projects that lead to tangible impact.  

A more comprehensive option is to directly support a high-impact climate action project from scratch. ACT partners with local implementers all over the world to develop projects. These include afforestation initiatives as well as campaigns to equip households in developing economies with improved cookstoves to optimize energy efficiency and reduce emissions. 

Partnering with a project developer like ACT to build a high-impact climate project helps to hedge against the volatility of the voluntary market because it results in a secure stream of carbon credits year on year, and ensures you are making a considerable impact over an extended period.  

Investing in project development also means you have more control over the impact you are able to have. You can choose technologies and methodologies that will yield more removals and reductions, and lead to more sustainable development in project regions. Though it does not address your internal emissions targets, this measure is a powerful signal to other companies. It showcases your commitment to net-zero emissions beyond what is required by supporting global ambitions to reach lofty climate action goals. 

Taking your first steps 

When companies have a robust understanding of their emissions sources, they can start taking actions to reduce and eliminate them. 

To achieve net-zero emissions by 2050 – or a more ambitious target year, if you set it as such – you must address internal emissions first and foremost. Based on your sector and industry, you will likely have to reduce 90% or so of your supply chain and operational emissions by your target year. 

One viable option is to switch electricity consumption from fossil fuel electricity generation to renewable sources, reducing Scope 2. Improving your facilities’ energy efficiency to conserve energy helps lower Scope 1 emissions, while encouraging suppliers to abate their emissions results in Scope 3 reductions. The Net-Zero Standard includes guidance on reducing Scope 3, which historically has been challenging, as companies must deal with both upstream and downstream activities outside their immediate ownership.  

While taking action to reduce emissions within your operations and along your value chain – both swiftly and incrementally, based on the goals you have set – you can compensate and neutralize your emissions by purchasing and retiring carbon credits. When you get closer to achieving long-term goals to more completely decarbonize, you will be able to phase in carbon removals to cover five to ten percent of your residual emissions.  

Immediately funding high-impact climate projects that generate carbon credits will complement your internal actions. This will drive emissions reductions and removals outside your company’s scope, supporting other organizations and communities to have an impact while taking steps to lessen your own footprint.  

How carbon credits complement your journey to net-zero emissions 

While carbon credits cannot officially be used for emissions abatement through the SBTi, they are useful supplementary tools that support climate action. Carbon removal credits finance CO2 and GHG removal projects, while avoidance and reduction credits represent GHG emissions abatement compared to business-as-usual scenarios. 

When internal reduction initiatives and private sector climate finance combine, that is where you get lasting contributions to the shared global ambition of solving the climate crisis.

 Committing to a plan 

The first real step in transforming decarbonization ambition into action is to clearly define near- and long-term goals in line with the Paris Agreement and Net-Zero Standard. 

To define an effective goal and start setting targets, companies need to understand their emissions and where they fit within the three GHG Protocol scopes. Understanding Scopes 1, 2, and 3 emissions helps define and manage the measures to reduce emissions.  

For instance, companies can commit to near-term, five to 10-year emission reduction targets, focusing on Scopes 1 and 2 emissions. With this concrete goal set in stone, companies will be able to create a trajectory with strategic decision-making and move on to longer-term targets. 

The most comprehensive way to designate goals is to sign up with the SBTi and set science-based targets (SBTs). This gives companies the right sector-relevant guidance and frames their targets under a common goal shared by over a thousand companies to date. This is especially helpful if many of your emissions fall under Scope 3, and therefore outside your immediate purview. The Net-Zero Standard’s guidance on this historically tricky scope makes following through on emissions goals that much easier.  

Companies can use carbon credits to compensate and neutralize emissions and invest in projects that generate credits on longer-term bases to spark climate action.

Carbon Offsetting  
The process of decarbonizing your organization can seem like a daunting task. Luckily, there are frameworks and guidance in place that help create actionable steps to realize your organization’s climate ambitions. This blog explores these strategies, the targets you can set, and the role carbon credits play in decarbonizing an organization.
Net-Zero Emissions – Where do carbon credits fit in the global journey to climate action?

Setting the scene

In the summer of 2021, the UN's Intergovernmental Panel on Climate Change (IPCC) published part one of a six-part assessment report stating that global temperatures will rise 1.5° Celsius by the early 2030s and continue to do so without mitigating action.

At COP26 later in the year, analysis by the Climate Action Tracker revealed that the planet is set to warm upwards of 2.4° Celsius by 2100, which is a far more troubling forecast than the IPCC’s assessment showed. In either case, climate action is required more than ever. 

Especially in the context of the Paris Agreement and the new global climate standards being set across the world, reaching net-zero emissions is a vital goal for companies to set today to safeguard our future.  

However, the journey to net-zero requires considerable dedication on the part of internal and external players along value chains. If companies commit to net-zero emissions, they should understand how net-zero is defined in scientific terms, and how to act on decarbonization plans.

Getting to net-zero emissions – taking cues from the Science Based Targets initiative (SBTi) 

Companies seeking to join the global cause to reach net-zero emissions should first define their ambition and targets, while ensuring they are grounded in science. As well, companies should learn the frameworks and standards that exist to help along the way.  

To aid enterprises in achieving lofty emissions goals, the Science Based Targets initiative (SBTi) released the Net-Zero Standard in October 2021, in the lead-up to COP26. This standard gives corporates valid frameworks and scientific guidance, providing accurate benchmarking and goal-setting tools for setting and achieving corporate net-zero emissions targets. 

While the pathway to net-zero emissions is complex, the SBTi’s standard breaks it down into two main timeframes and several complementary actions. 

  1. Set near-term science-based targets: 5-10 year emission reduction targets in line with limiting warming to 1.5°C.  
  2. Set long-term science-based targets: Most companies will reduce emissions by at least 90% by no later than 2050 (companies in the forestry and agriculture sectors will need to reduce emissions by at least 80%). 
  3. Move beyond value chain mitigation: Companies are expected to take action to mitigate emissions beyond their value chains; for example, by purchasing high-quality, REDD+ credits or investing in direct air capture. 
  4. Neutralize residual emissions: Any remaining emissions must be neutralized with permanent carbon removals.

Companies can use carbon credits to compensate and neutralize emissions and invest in projects that generate credits on longer-term bases to spark climate action.  

As the Net-Zero Standard is a recent development, the expectation is that SBTi and other organizations will be providing more insight into the role of carbon credits in the future.  

How does Ubicquia work with its local communities to help drive change? How do you expect these changes to impact the standard for safe and smart infrastructure going forward?

All of Ubicquia’s platforms are industrial AI and data driven. It is this data that helps communities better understand and align on where they need to target initiatives and investments into areas such as public safety, broadband, air quality and traffic planning. Our solutions are aligned with federal infrastructure funding in the U.S. and other similar global initiatives.

Standards for critical infrastructure are typically driven by major customer groups such as leading utilities, mobile operators and municipalities and their related industry organizations.

As an example, Florida Power and Light (FP&L) is one of the leading utilities in the U.S. They are also an investor in Ubicquia. We collaborated with FP&L to develop our Distribution Transformer Monitoring platform, DTM+. This platform helped FP&L win the PA Consulting Reliability One award, which is the highest industry award for grid resiliency.  FP&L is now mandating that our technology integrates into the transformers of their top five suppliers that also supply transformers to more than 2,000 other utilities.

While our activities are no guarantee to drive standards, our multi-pronged approach of marquee customers and OEM integrations will help to drive our platforms and standards in the marketplace for intelligent infrastructure.

Can you discuss the importance of alignment with your investors, stakeholders, customers and your company mission?

Ubicquia platforms address key issues at the heart of ESG and Impact. We have designed our platforms to cost effectively scale [, driving] annual incremental benefits in energy savings and maintenance costs and helping to extend the life and value of critical utility, communications and public safety infrastructure.

Ubicquia and our platforms allow us to have a long-term view and a 10+ year partnership with our customers. Whether it is driving energy savings that help fuel public broadband initiatives or valuable street analytics that help to target public safety programs, our platforms and interaction with our customers are having a meaningful long-term impact.

What are some near-term goals for Ubicquia and where do you ultimately expect to see the company in five to 10 years? 

As our smart city, communications and smart grid platforms address key challenges globally, we will look to expand our market presence and channel partners in several key international markets

Over the next 5-10 years, we see significant opportunities to continue to innovate in partnership with our major customers that include municipalities, utilities and mobile operators. We see opportunities to leverage our streetlight position to provide valuable infrastructure for electric vehicle charging and autonomous vehicle support that aligns with market demand.

With the mission to make the existing 360 million streetlights, 500 million utility transformers and one billion utility poles worldwide intelligent, we have a significant opportunity in front of us for the next 10 years.

Can you discuss why/how Ubicquia was founded and how it has worked to achieve that mission?

Ubicquia started in 2017 with a simple idea: We can take existing critical infrastructure including streetlights, distribution transformers and utility poles and make them intelligent [, resulting in] smarter, safer and more connected [communities]. 

While our mission is to make cities smarter, safer and more connected, our mantra is “Simply Connected, Simply Smart.” We believe making existing infrastructure intelligent should be easy to do, designed to scale and cost effective for cities of all sizes. Our platforms are addressing key challenges of critical infrastructure providers such as enhancing public safety for municipalities, grid resiliency for utilities, and making reliable and affordable broadband available to all.

Much like Hamilton Lane, the management team at Ubicquia relies heavily on data and data tracking. Can you tell us about the data you track and why this is so important?

Our customers entrust our platforms to deliver critical data used for everything from energy savings and traffic management to grid resiliency and public safety.

Our UbiCell controls and monitors streetlights across the city. Our data and AI algorithms allow cities to schedule and dynamically control their lighting levels and in turn deliver up to 40% in energy savings. When plugged into the photocell socket, the UbiCell automatically delivers asset details including location, manufacture, wattage level and real-time status of the luminaire to reduce operations and maintenance costs and be more responsive to outages. The UbiCell is also a certified utility meter, so it not only gives customers real-time billing information but monitors the quality of the incoming power to help utilities isolate problems in the utility network.

Our UbiHub plugs into a streetlight in seconds and starts delivering valuable data in minutes. Our real-time AI delivers data to monitor traffic counts, que length and other insights to optimize vehicle, pedestrian and bicycle traffic. The UbiHub also delivers real-time audio data analysis [that detects] pedestrian and vehicle congestion. The UbiHub is a video and audio edge AI platform that has been customized for other applications including detection and reporting of illegal dumping and garbage can-level detection for sanitization pick-up.

Our DTM+ attaches to any utility distribution transformer in minutes and delivers real-time data on the physical and electrical health of the transformer. Our predictive AI algorithms can detect faults that indicate the transformer will fail and allow the utility to replace the transformer, eliminating costly outages and additional truck rolls. Our data can determine which manufacturer’s transformers are more reliable and efficient and what is the optimal size for a transformer, delivering numerous supply chain benefits. The DTM+ can also detect and pinpoint power theft in real time.

Ubicquia’s smart city, communications and smart grid platforms are easy to deploy and scale. In turn, we can deliver valuable data and insights in a timely manner to drive decision making and consensus, which is fundamental in bringing communities together.

An Interview with Ian Aaron, CEO of Ubicquia

Brent Burnett

Co-Head of Real Assets

Hamilton Lane

Paul Yett
Director of ESG & Sustainability

Hamilton Lane

While ESG and Impact are distinct topics, they deal with similar subject matter 
and one often informs the other. The video below discusses how responsible 
infrastructure investing can play a part in supporting the energy transition. 

We discuss this and more in our Q&A.

Navigating ESG Complexities Through the Energy Transition
The transition to shift to cleaner and more sustainable forms of energy is a complex process, one in which infrastructure must play a critical role.