The Gore Effect

Did Al Gore cost investors trillions…and slow climate progress by nearly two decades?

That is a loaded question.

If you are on the right, you may assume I am about to blame Democrats for politicizing climate.

If you are on the left, you may assume I am about to attack one of the most important climate advocates of the modern era.

If you are anywhere else in the world, you may map that same instinct onto your own version of Republican or Conservative…Democrat or Liberal…and arrive at the same conclusion.

All of those reactions miss the point.

And to be clear, being a Republican or Conservative does not make you anti-climate.  Being a Democrat or Liberal does not make you pro-climate.  Politics is messier than that.  Which is precisely why this matters.

I ask the question because climate change is not a religion.  It is not a party platform.  It is not an ideology.

It is physics.

Molecules do not care what you believe.  And yet for nearly two decades, capital has behaved as though this were a matter of tribal identity, not thermodynamics.

That is a very expensive mistake.

I say that as a card-carrying member of Al Gore’s Climate Reality Project…trained way back in 2008.  I have spent years helping spread the climate word far and wide.  So this is not a cheap shot from the sidelines.  It is a critique from inside the tent.

Now, let’s be precise.

Al Gore was not the problem. He wasn’t wrong. He wasn’t even early. But he was visible.

And that visibility did something no model, forecast, or policy ever could.

It gave the energy transition a political identity.

I call this The Gore Effect.

The moment an economic inevitability became a political identity - causing capital to misprice reality for nearly two decades.

Before that moment, this was an engineering problem.  A capital allocation problem.  An infrastructure buildout.  A resource productivity story waiting for disciplined investors to notice it.

After that moment, it became something else.

It became a belief system.

And markets are terrible at pricing belief systems.

But, what actually broke?

Not the science. Not the technologies. Not the trajectory.

What broke was objectivity.

Once climate had a political face, it also had a political enemy.  The Gore Effect was not just a branding event.  It was the starting gun for polarization.  It gave incumbents, ideologues, and opportunists a target.  From that point on, too much capital stopped asking, “Does this work?” and started asking, “Who is this for?”

That was the mistake.

Because once an economic shift is dragged into culture war territory, the incumbent system does not surrender gracefully.  It fights for survival.  It uses politics to delay economics.  It uses narrative to defend margin.  It uses identity to obscure performance.  It uses every tool available to avoid disruption…even when the underlying economics are shifting beneath it.

That is what we have been living through.

The sequence was predictable.

First, climate became a political marker. Then it became ESG. Then ESG became a marketing strategy. Marketing invited tourists. Tourists brought hype. Hype brought bad capital allocation. Bad capital allocation produced very public failures. And those failures were then used as proof that the entire category was broken.

Meanwhile, the underlying technologies kept improving.

Solar got cheaper. Batteries got better. Electric systems kept gaining ground.

According to the IEA Global Energy Review 2025, renewable capacity additions approached 700 gigawatts in 2024, with solar driving the majority of that growth.  Renewables and nuclear together accounted for roughly 80 percent of global electricity generation growth.

The physics advanced.

The market narrative did not.

That is the real cost of the Gore Effect.  It did not alter the destination.  It altered who felt allowed to participate in the journey.

You can misprice something for a long time.

You cannot misprice it forever.

Eventually, the gap between narrative and reality closes.

Not gradually.

Decisively.

That moment is where we are now...at the Climate Correction.

I use the phrase Climate Correction very deliberately.

Not climate transition. Not climate movement. Not climate crusade.

A Climate Correction.

Because the global economy has spent decades underpricing climate risk, underinvesting in resilient infrastructure, and misunderstanding the economics of cleaner, more efficient systems.

The Climate Correction is the repricing that follows.

It is the slow, then sudden realization that the old system was flattered by false accounting and political protection, while the new system was penalized by ideology, inertia, and bad pattern recognition.

In plain English, the market has been wrong for a long time.  Reality is beginning to collect.

And corrections do not reward belief.

They reward positioning. They reward structure. They reward investors who understand not just what is happening, but how capital actually flows through it.

That is why this matters so much.

The biggest risk in climate investing is not climate. It is confusing politics for price.

There are three ways investors got this wrong

Most investors who missed this opportunity fall into one of three camps.

First is The Burned.

“We tried cleantech. It didn’t work.”

No.

What failed was not climate.

What failed was applying software investing models to infrastructure problems.

The first cleantech wave taught a brutal but useful lesson.  If you fund long-duration, capital-intensive deployment risk with venture-style impatience, the math will not forgive you.

That is not an indictment of decarbonization.

It is an indictment of misapplied venture math.

The lesson was not about science.

The lesson was about structure and markets.

Do not conflate software investing with infrastructure investing.

And if I’m being honest, many of us, including those allocating capital, had to learn that the hard way.

We learned that timelines are longer. We learned that capital intensity matters. We learned that reserves strategy is not optional. We learned that syndicate quality determines outcomes.

We learned that the “missing middle” is real. We learned that hard tech does not behave like SaaS. We learned that carbon advantage without economic advantage does not scale.

And we learned that discipline, not enthusiasm, is what compounds.

Those lessons are now embedded.

Which is why this cycle looks very different from the last one.

Not because the opportunity changed.

Because the investors did.

Second is the The Politically Cautious.

“We cannot be seen in this space.”

This is the Gore Effect in its purest form.

Once an investment thesis requires optics management you are no longer investing.

You are performing.

And yet the economics keep moving.

According to the IEA World Energy Investment 2025 report, global clean energy investment is approaching $2 trillion annually.  That is nearly double fossil fuel investment in the same period.  China alone exceeded $625 billion in 2024.  The European Union is approaching $400 billion annually.  The United States continues to scale, with tens of billions flowing into domestic clean manufacturing.

The point is not political alignment.

The point is economic gravity.

Infrastructure does not care about your narrative.

Capital flows where returns are durable, demand is real, and systems must be built.

Politics makes noise.

Infrastructure makes money.

And, the third, The AI Chasers

“We are focused on AI.”

Fine.

Then you are already in the Climate Correction.

AI is not just a software story.

It is an electricity story.

According to the 2025 IEA Electricity Outlook, global data center demand is expected to more than double by 2030…becoming one of the largest drivers of incremental electricity demand this decade. In the United States alone, corporate power purchase agreements tied to technology and data centers now exceed 80 gigawatts.

Here is where the Gore Effect quietly does its damage.

It does not just discourage climate investing.

It distorts how investors see the system.

It creates false separations.

AI versus climate. Growth versus infrastructure. Digital versus physical.

But these are not separate systems.

They never were.

If you still think they are…you are not seeing the market clearly.

You are seeing it through the lens of a political distortion.

And that distortion creates blind spots.

If you are long AI and not thinking deeply about energy…you do not have a differentiated thesis.

You have a blind spot.

But, while the West debates, China builds. And, this is where the consequences become harder to ignore.

China never really had a Gore Effect.

It did not turn the energy transition into a morality play.

It treated it as industrial policy.

As manufacturing.

As supply chain control.

As geopolitical leverage.

According to IEA and Carbon Brief analysis, China’s clean energy economy reached roughly $2.1 trillion in 2025.  That represents over a third of GDP growth and the vast majority of incremental investment growth.  China accounts for close to 60 percent of global renewable capacity expansion through 2030.  It dominates solar manufacturing, battery supply chains, and electric vehicle production at scale.

This is not about virtue.

It is about positioning.

And there is a second-order effect that is rarely discussed.

The legacy system, the concentrated, capital intensive, and politically defended, tends to concentrate wealth as it ages.  This results in a hollowing out of the middle-class, the engine of western economies.  New systems, especially those that are more distributed, more electrified, more modular, tend to expand access and participation.

When capital delays the transition, it does not preserve stability.

It increases systemic fragility.

That is the part markets tend to notice last.

So how can this be reframed?

The Gore Effect did not make climate optional.

It made acknowledging it feel partisan and pricing it feel elective.

The Climate Correction is proving that it is not.

Because this was never, at its core, about virtue.

It was about productivity. It was about cost curves. It was about energy security. It was about making and moving things more efficiently.

It was about replacing systems that are brittle, wasteful, and increasingly expensive with systems that are cheaper, faster, cleaner, and more resilient.

Solar scales because it is cheap. Storage scales because flexibility matters. Electrification scales because efficiency wins.

According to the IEA Global Energy Review 2025, renewables are now taking meaningful share across major economies, often outcompeting fossil generation on cost.

No ideology required.

Just arithmetic.

Let me close with a final thought.

Al Gore is not the villain of this story.

He is not the messiah either.

He is the catalyst.

He is the moment the market revealed something deeply uncomfortable about itself.

Investors do not merely misprice assets. They misprice their own biases - and then defend them as strategy.

That is why I call this phenomenon The Gore Effect.

Not to blame Gore.

But, to describe the distortion.

The Gore Effect created the mispricing.

The Climate Correction is the repricing.

And the only question that matters now is this.

Are you still investing based on politics…or have you gone back to price?

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To read more from Nelson, you can purchase The Gigacorn Hunter: Seven Principles for a Climate Investor here.