Fwd: $670,000 climate jobs

[Loretta Lohman]

Read in browser

With risk comes opportunity. At least that’s the case for some of the biggest firms on Wall Street, who are searching for experts to help build out their insurance-linked securities desks. Today’s newsletter goes into the recruiting process and why it pays to be able to model natural disasters. Plus, New York just got a huge influx of clean power, but it still needs more. Subscribe to Bloomberg to get unlimited access to all our stories. Catastrophe risk management By Gautam Naik When Mitesh Parikh, a headhunter at UK recruiter Selby Jennings, started looking for an ILS modeler for a large US hedge fund this year, the pool of qualified candidates was disconcertingly small. “It was a tough search,” says Parikh, who specializes in roles focused on risk. ILS — which stands for insurance-linked securities — is “a relatively new and emerging area among hedge funds,” he said. “And they’re all looking for the same talent.” Experts in ILS have traditionally focused on things like modeling the probability that a hurricane might hit an urban area, and how that would feed into insurance risk. Such analyses have long been relevant for investors in catastrophe bonds, which make up a niche corner of capital markets worth nearly $70 billion in total. Burned vehicles at the Altadena Auto Center after the Eaton Fire in Altadena, California in January 2025. Photographer: Kyle Grillot/Bloomberg Now, some of the world’s biggest hedge funds and banks want to incorporate the expertise of catastrophe-risk professionals across a broader chunk of the finance sector, as the skills required to model natural disasters become increasingly relevant for asset values in a hotter, more turbulent world. For hedge funds, the challenge is finding ILS experts who also have a nous for finance and investing. It took a couple of months before Parikh was able to find the right candidate for his US hedge-fund client, whose identity he declined to disclose. The standard compensation package for such hires tends to be around $400,000 to $670,000, he said. It’s part of an emerging pattern among banks and hedge funds, as they try to adapt their businesses to a world shaped by a rise in violent, destabilizing weather cycles. Knowing how to model everything from wildfires to floods and even civil unrest is now more important than ever. And with the possibility of a so-called super El Niño cycle affecting weather patterns this year, investors, banks and insurers are particularly keen to ensure they’re not caught flat-footed. JPMorgan Chase & Co. is among firms looking for people to help the bank deal with such threats. It’s in the process of hiring an executive director to lead the implementation of catastrophe modeling for climate risk, as well as an analyst to go alongside the role in New York, according to a Linkedin post published by Catherine Ansell, JPMorgan’s executive director of Climate, Nature and Social. Jane Street, one of the world’s most profitable quantitative trading firms, has been looking for a London-based senior weather analyst. It’s also trying to fill a similar position at its commodities trading desk in New York. Others have already built out such teams. Bloomberg has previously reported that Millennium Management and Squarepoint Capital are among firms hiring, with some paying as much as $1 million for the right weather modeler. At Citadel, there are about two-dozen weather experts helping drive its trades in oil, gas, and other commodities. Read more In-demand niche 2,000 The rough number of ILS experts in the world, according to one recruitment adviser. Expensive hedge “This is an historic opportunity for the insurance-linked market” Niklaus Hilti Chief Investment Officer, Euler ILS Partners The team of former Credit Suisse bankers is launching a fund they say will offer double-digit returns in exchange for taking on some of the insurance risk tied to data centers. ‘Is it big enough?’ By Olivia Raimonde The Champlain Hudson Power Express is now delivering hydroelectric energy from Quebec to Queens. New York State’s long-term contract with Hydro-Quebec began June 1, providing a major supply of carbon-free power as the state works to meet high targets for renewable capacity and emissions cuts. But rising electricity demand and the hurdles facing offshore wind means the gap that the transmission line helps fill is only getting bigger. “The question is, is it big enough to make a huge dent?” said Rob Gramlich, founder and president at consulting firm Grid Strategies. “And I think as the needs keep growing, no single line like this can make a major dent anymore.” Power lines at the Hydro-Quebec Beauharnois hydroelectric generating station. Photographer: Graham Hughes/Bloomberg The 339-mile long transmission line, backed by Blackstone Inc., can transmit up to 1,250 megawatts of electricity, enough to power 1 million households. It’s expected to deliver about 10.4 terawatt-hours of clean energy annually to the New York metropolitan area and to decrease CO2 emissions by an average of 3.9 million metric tons per year, the equivalent of removing 44% of passenger vehicles from New York City. The line was designed to get more clean energy directly to New York City. But the city’s power demand is expected to rise as climate change makes summers hotter and building owners replace fossil-fuel heating systems with electric heat pumps to comply with Local Law 97. The New York Independent System Operator, which manages the state’s power grid, projects that electricity consumption in the city will increase by 23% by 2050. “We’re going to have to push farther on every front,” New York City Comptroller Mark Levine said in an interview. “Mega projects like offshore wind, micro projects like rooftop solar in the city, innovative projects like geothermal wells.” The city’s pension funds have committed to invest $50 billion in climate solutions by 2035, Levine noted. Read more Listen to Zero Zero Asia’s Ukraine Moment Supercharges Clean Energy It’s been more than three months since the US attacked Iran, leading to the closure of the Strait of Hormuz that carries 20% of the world’s oil and gas. The shock to energy markets has been so intense that some countries are taking longer-term measures to cope. This week on Zero, Akshat Rathi and Peter Guest explore the history of policy responses to energy shocks and what’s different in the 2020s. Listen now, and subscribe on Apple, Spotify or YouTube to get new episodes of Zero every Thursday. More from Green Legal & General Says Energy Transition is ‘Alive and Well’ The UK insurer and asset manager challenged the notion that the shift to a low-carbon economy has stalled. EU Plans Lower Taxes on Clean Energy in Drive to Cut Power Bills Policymakers also want to make electricity systems more flexible. Mexico Awarded 37 Renewable Electricity Projects in Tender It was the first step in adding an expected 7,411 megawatts of generation capacity. Clean-Tech Venture Investors Face Concentration Risks in Funds Investors in the US and Europe may be less diversified than they realize. More from Bloomberg Business of Food for a weekly look at how the world feeds itself in a changing economy and climate, from farming to supply chains to consumer trends Energy Daily for a daily guide to the energy and commodities markets that power the global economy Tech In Depth for analysis and scoops about the business of technology Explore all Bloomberg newsletters. We’re improving your newsletter experience and we’d love your feedback. If something looks off, help us fine-tune your experience by reporting it here. Follow Us You received this message because you are subscribed to Bloomberg’s Green Daily newsletter. If a friend forwarded you this message, sign up here to get it in your inbox. Unsubscribe Bloomberg.com Contact Us Bloomberg L.P. 731 Lexington Avenue New York, NY 10022 |