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In order to limit the increase in global average temperature to no more than 2 degrees Celsius by the end of this century, more than $1 trillion of new investment capital per year is needed. And the focus should be deployment of currently viable technologies.
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Investing for Climate Impact: Opportunities for Advancing Clean Energy
In order to limit the increase in global average temperature to no more than 2 degrees Celsius by the end of this century, more than $1 trillion of new investment capital per year is needed. And the focus should be deployment of currently viable technologies. Those were among the messages to emerge from a recent discussion that Athena Capital hosted to identify opportunities for investors interested in the transition to a less carbon-intensive energy economy. We were joined by an informed and experienced group of asset owners, financial advisors, policy researchers, and business entrepreneurs. Other themes that emerged from the conversation included the following: Renewables. The cost of solar and wind generation has declined sharply and is now competitive in many situations with power production from conventional fossil fuels. While previously viewed as risky, financing deployment of solar and wind generating assets is attracting increasing interest from institutional investors and large banks.
Many investors view solar as the “life blood of growth” for the renewable sector and a large opportunity since it accounts for only 2.5% of current generating capacity in the US. Broader adoption of solar and wind will create other investment opportunities in the areas of energy storage and grid management. Transportation. The electrification of transportation and the transition away from conventional transport fuels is another expanding area for new investment. Historically largely separate, the power and transportation sectors will be increasingly integrated in the future. For example, municipalities are introducing more and more electric buses, and electric vehicles are being charged by on-site, distributed renewable power systems. New Business Models. Much of what is required to address the challenge of climate change involves adjustments in consumer behavior. Entrepreneurs are pioneering innovative new business models that encourage behavioral change in the direction of a lower carbon future. This is often reinforced by parallel developments in public policy and regulatory frameworks.
In short, there is a broad range of opportunity available to return-seeking investors that want their capital to contribute to the goal of lowering greenhouse gas emissions. Athena Capital is currently assisting several clients with this objective. Considerable progress can be accomplished through more widespread deployment of proven, commercially viable technologies that are currently available. There is no need to wait for dramatic, new, break-through solutions. Article Resource - https://www.athenacapital.com/blog/investing-for-climate-impact-opportunities-for-advancing-clean-energy/