Diego Saez Gil co-founded air-conditioning technology startup Pachama in 2018, at a time when major companies in Silicon Valley and elsewhere were looking for ways to offset carbon emissions through forest conservation.
Saez Gil grew up near the Yungas forest region of northwestern Argentina. His long-standing interest in the South American desert was rekindled on a visit to the Amazon, where he saw the scale of deforestation.
He recently spoke to The Associated Press about how the San Francisco-based company is using satellite imagery, drones and artificial intelligence to analyze forest canopies, with a mission to help verify that company-funded restoration projects are working as promised. sequester carbon and encourage biodiversity.
Q: How do you make money?
A: We are active in carbon markets. Projects can be created and receive carbon credits if they lead to additional carbon sequestration in the future. Pachama acts as an intermediary platform that helps projects get started with everything they need to obtain carbon credits. We use satellite data, artificial intelligence and other sources to build the carbon accounting and carbon credit case for these projects. Then help issue those carbon credits and connect those projects with companies and investors around the world. We make money by getting a fee for the transactions we facilitate. We ensure that the vast majority of funding actually goes to the communities and the people on the ground doing maintenance or restoration.
Q: Could you describe a specific project?
A: There is an incredible project (sponsored by the e-commerce company MercadoLibre) that we helped start in the Atlantic Forest of Brazil. It reforests wildlife corridors, connecting patches of forest, allowing endangered species to go from one place to another, which will help some of these endangered species recover. This is an area that was once fully covered with forest and since the 1970s has been largely deforested by agriculture. Now there is an intention by many local and international actors to help reforest this area because it is a critical ecosystem that has huge biodiversity and plays a critical role for the climate. Over a million trees have been planted and the project will continue to expand.
Q: Who are your customers?
A: We work with many Fortune 500 companies that generally have a comprehensive climate action plan. This starts with measuring their emissions, reducing their emissions as much as they can, and finally deciding to invest in decarbonisation by investing in projects that help them reduce hard-to-limit emissions. Some of our clients include Shopify, Salesforce, Amazon, Airbnb, Netflix, Flexport. We resonate with technology companies that understand the technologies we build. But clearly, the intention is for every company to take responsibility for their carbon footprint.
Q: What about concerns that these credits are an excuse for polluters to keep polluting?
A: Some bad players in the past have taken to the bad practice of buying some carbon offsets, putting an ad on social media about some trees being planted and using it as a way to hide the fact that they aren’t actually doing anything to change their business. I’m thinking of oil and gas companies. We should avoid and expose attempts at greenwashing. That said, I strongly believe that the transition away from fossil fuels is a multi-decade transition. We absolutely need all companies to invest heavily now in projects that will remove carbon and avoid carbon emissions. We focus on conserving rainforests and reforesting native forests around the world. These are things that need to be done today. If we wait two decades, it will be too late.
Q: Who are your competitors?
A: There are some interesting organizations that we overlap with on the data side. We have invested heavily in using satellite data and artificial intelligence to analyze forestry projects. There are companies like Sylvera that use data to assess and evaluate projects. NASA has worked hard to determine carbon from space. Planet, the satellite company, provides information and analysis about nature from space. On the project side, there’s a company called Earthshot Labs that takes a similar approach to starting new, high-quality projects in nature. There is a company called NCX that is also trying to find an innovative way to create forest projects. And then there are several companies that have had a role for a long time, like South Pole and ClimatePartner.
Q: How do you differentiate Pachama?
A: What’s unique about us is that we have this very strong technology DNA. Our first focus was building an engineering and science team to crack the code of predicting a forest’s carbon, deforestation and other metrics from satellite data and artificial intelligence. We built a strong capability there. We then combine this with on-the-ground presence and project development. There are many companies that are very local or focus on specific geographies. We are trying to have a system that can work around the world.
Q: How much do you plant native tree species?
A: Unfortunately, when you look at the legacy of coal projects, probably the majority of projects were primarily monoculture timber plantation types. We need to continue to do some timber plantations because wood is a very sustainable material that we need to continue building houses and furniture and things for people. I believe that for coal projects we should focus mainly on native reforestation. So we have set an internal goal to have projects with only the vast majority of native species and to avoid monoculture tree plantations. One of the issues with monoculture tree plantations receiving carbon credits is that if these trees are to be cut for wood in the future, then it is debatable whether you need credits to incentivize these plantations in the first place.