Apple is a leader in issuing so-called green bonds to fund alternative energy projects.
John Moore—Getty Images
By Aaron Pressman and Adam Lashinsky
September 7, 2018

This article first appeared in Data Sheet, Fortune’s daily newsletter on the top tech news. To get it delivered daily to your in-box, sign up here.

A decade ago, when smart venture capitalists should have been dumping every dollar possible into investments that would benefit from the rise of the smartphone, many instead embraced the “green” or “clean” revolution. At the time, I deployed quotations marks disparagingly. “Cleantech” startups were merely exceedingly risky energy investments, and were best understood that way by investors.

The sector, such as it was, was a giant flop. It ended careers and otherwise dented reputations on Sand Hill Road, Silicon Valley’s VC epicenter. The investments left pitiful scars in the entrepreneurial class, too. Many who had wanted to do good went back to trying to do well.

And so Matt Heimer’s incisive report in the current issue of Fortune on “green” bonds—no mockery here—came as an epiphany. Championed by Bank of America, the bonds tied to energy projects not involving the burning of fossil fuels have been a modest hit. That the yields on some of these bonds for projects like solar and wind farms are low, a bit over 1%, is a testament to their relative safety.

Donning the green garb always runs the risk of self-righteousness, but BofA spearheaded an industry group that agreed on terms. Corporate borrowers from phone maker Apple to utility NextEra have availed themselves of the pleasingly named financial instruments. It helps that tax benefits often are part of the investment rationale behind alternative-energy projects. So be it. There’s money to be made here.

Green bonds won’t lead to breakthrough innovations the way backers of the “cleantech” hoped it would. But they do fund worthy projects that do their bit to add less rather than more pollution to the environment. That’s a praiseworthy development.

Adam Lashinsky
@adamlashinsky
adam_lashinsky@fortune.com

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