Investing In Renewable Energy: Profiting From Sustainable Power Sources – Global decarbonization will require building massive amounts of wind and solar farms. But developers can find enough land. Maintain the supply chain And can you recruit employees while still maintaining a profit?

The rapid growth of wind and solar power comes as no surprise. Recently, the development of new solar farms and wind turbines has often been driven by smaller regional players. And the costs are much higher than the costs of coal-fired power plants. Today, the costs of renewable energy are falling. And many solar and wind energy projects are operated by large multinational companies. This often announces startling development goals as well.

Investing In Renewable Energy: Profiting From Sustainable Power Sources

Investing In Renewable Energy: Profiting From Sustainable Power Sources

This article is a joint effort by Florian Heineke, Nadine Janecke, Holger Klärner, Florian Kühn, Humayun Tai and Raffael Winter, and provides a perspective from the electric power and natural gas practices of

Infrastructure And The Road To Sustainability

During the past decade Renewable energy growth has consistently and dramatically outperformed most expectations (Exhibit 1). Revising upward estimates has become a ritual.

But this growth story is just beginning. While various countries Aims to meet ambitious carbon dioxide reduction targets Renewable energy led by wind and solar It is ready to become the backbone of the world’s energy resources. In addition to increasing production capacity from major energy providers. New types of players are also entering the market (Exhibit 2). Today’s fast-trackers include major oil and gas companies. It aims to transform its business model to profit from the growing demand for renewable energy and vehicle electrification. as well as private equity players and institutional investors making renewable energy a core component of their investment strategies. Transportation industry leaders are investing in renewable energy to enable the production of hydrogen and ammonia as zero-emission fuel sources. zero Steelmakers are eyeing green hydrogen to reduce carbon emissions in their steel production. Renewable energy provides green electricity for this process. Automakers are also interested in renewable energy deals to help with operations and production. Including investments in wind and solar energy projects.

It is estimated that by 2026 global renewable electricity capacity will increase by more than 80 percent from 2020 levels (to more than 5,022 gigawatts).1 Global Energy Outlook 2022 April 2022 Building on this growth Two thirds will come from the wind. and solar power to grow 150 percent (3,404 gigawatts) by 2035. Renewable energy will provide 60 percent of the world’s electricity.2 Global Energy Perspective 2022, April 2022 But these projections may be too low. Three years ago, we Consider the progress made by renewable energy and ask, “How fast will it grow?”3 “Rethinking Renewable Energy Strategy for an Era of Global Competition” October 11, 2019 The answer is: faster than you think they can.

The race to build more solar and wind power will increase pressure on developers to operate efficiently. and increasing competition for finite resources. However, the three winning capabilities that we identified three years ago as essential to building or scaling a renewable energy business are even more important now. They build the foundation needed to meet upcoming challenges:

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Leveraging these abilities provides a solid foundation. Successful renewable energy developers must navigate an increasingly complex and competitive landscape. Specifically, they must focus on and address four emerging challenges:

Renewable energy developers must take decisive action to prepare for these upcoming challenges. In future articles, we will provide detailed insights into each of these pressures. and share how players can take action.

Florian Heineke is a consultant in the Frankfurt office, Nadine Janecke is a partner in the Hamburg office, Holger Klärner is a partner in the Berlin office, Florian Kühn is a partner in the Oslo office, Humayun Tai is a senior partner in the New York office, and Raffael is a partner in the Frankfurt office. Winter is a partner in the Düsseldorf office.

Investing In Renewable Energy: Profiting From Sustainable Power Sources

The author would like to thank Nadia Christakou, Florent Erbar, David Frankel, Emil Hosius, Anna Kemp, Nadine Palmowski, Andreas Schlosser, Sophia Spitzer, Christian Staudt, and Jakub Zivansky for their contributions to this article. In my practice, I find that most people don’t know that sustainable or socially responsible investing is an option.

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Yes, you can invest your money in companies that are trying to solve humanity’s most daunting problems while still making a profit. No, you don’t have to blindly buy fossil fuel and weapons companies through mutual funds and index funds.

When talking about sustainable investing There are many ways to brand your investments. ESG, Impact investing, SRI, and Green are the most popular types. I view these forms as slightly different religions that worship the same god.

The differences are quite nuanced, for example SRI (Socially Responsible Investment) emphasizes the exemption of certain industries. while impact investing focuses on underserved communities and countries.

Green investing, as you probably guessed. Focused on Environmental Issues ESG seeks to find companies that score well on environmental, social and governance issues. My favorite name of all of these is Sustainable Investing.

Renewable Energy Opportunities And Risks For Investors

“Sustainability” is the appeal of all these approaches. “Sustainable” means that something can survive and last forever. I feel like this fits perfectly into the world of investing.

Why would you invest long-term money in a business or industry that cannot survive in the long term? Why invest in a company that is a parasite behind the economy or the environment? Why invest in an industry that the majority opposes and is actively trying to disrupt?

Responsible investment criteria are quite subjective. But I believe most people in this movement view things the same way. For example, Impact Fiduciary avoids investing in tobacco companies, weapons manufacturers, and opium manufacturers/distributors. Health insurance companies, private prisons, and most importantly, fossil fuel companies.

Investing In Renewable Energy: Profiting From Sustainable Power Sources

Especially The fight against climate change is more imperative than ever. This is humanity’s greatest challenge. And time is running out We are now at a crossroads where, if we don’t take action in the next decade, we could make the planet completely uninhabitable.

Renewable Clean Energy Investment For Sustainability Concept And Alternative Energy Economic Growth Idea Stock Image

It details how bad things will be in both the best and worst case scenario. This book is profound and absolutely terrifying. This book ranks among the easiest to read books on climate change. Because most scientists are not necessarily the greatest writers.

Wallace-Wells It details how, over the past 30 years, humans have contributed more than half of the carbon that causes global warming. He points out that we are now living the consequences of decisions made in the ’80s and ’90s when episodes of Friends and Seinfeld first aired.

It is difficult to get society to act on climate change. Because it doesn’t affect everyone immediately. Most people don’t care as long as the beer is cold and the shower is warm. However, climate change is becoming more and more apparent. As we experience 1 in 500,000 natural disasters every year.

Unless your head is in the sand. You may have experienced record heat and seen floods, forest fires, hurricanes, cyclones, mudslides, and other natural disasters. According to the proportions of the Bible

Green America — Green America Center For Sustainability Solutionstitle

The past five years have been the hottest years ever. Because we’ve seen this so often. new phenomena It will soon be called “Weather.” Not a good idea to fight against Mother Earth!

According to leading climate scientists The natural disasters of recent years would seem like a picnic. compared to what is expected to happen in the next 30 years.

We could literally make some of the world’s most populated places completely uninhabitable. This results in hundreds of millions of climate refugees. This will cause death and destruction on a scale we have never seen before and end up costing the global economy trillions of dollars.

Investing In Renewable Energy: Profiting From Sustainable Power Sources

So what does all this have to do with sustainable investing? Sustainable investing allows you to vote with your wallet. By not blindly buying companies that contribute to global warming, such as the fossil fuel industry, in turn, you free up your capital to support ambitious companies working to address climate change. Pointing out problems is not enough. Finding a solution is equally important.

Why Did Renewables Become So Cheap So Fast?

I have no illusions that not investing a small amount of money in Chevron will solve this problem. I view this in the same way as voting in a democracy. My score will not be individually important. But it’s definitely from an overall standpoint that it makes voting more worthwhile. Additionally, I would like to be more intentional in all areas of my life, including investing.

I believe every effort, no matter how big or small, is worth it! If you are reading this message It means you likely have the economic bandwidth to help in other areas as well: drive an electric car, buy solar power. Eat plant foods every day. riding a bicycle to work Live close to work, compost, recycle, walk! There are many things you can do in conjunction with your focus on responsible investing. The bonus is that they will improve your health too!

As a fiduciary I have a legal obligation to act in the best interests of my clients. I wholeheartedly believe that avoiding unsustainable industries and companies while investing in positive change makes the most economic and moral sense in the long run. If you have children or want our species to survive, so do you.

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