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As the world shifts toward a low-carbon economy to stem the effects of climate change, decarbonizing the global energy sector will be critical. The clean energy, clean transport, and electricity sectors will likely experience unprecedented growth as demand for conventional, hydrocarbon-based energy wanes. While renewables like wind and solar have so far attracted the most attention from investors seeking to capitalize on this secular trend, we believe electric utilities are a less obvious, underappreciated opportunity that merit closer inspection.
As distributors of power, electric utilities are essential for enabling the energy transition. In the coming decades, trillions of dollars in investment capital will be spent modernizing the grid to incorporate the increasing share of renewables. And critically, because they are regulated entities, electric network utilities offer investors the potential to earn attractive, stable returns for years to come. While renewables and utilities are both energy-transition plays, here’s how, in our view, the two industries stack up from an investment perspective:
The world’s energy consumption is changing, with electricity expected to gain significant share of the energy mix over the next two decades, mostly at the expense of…
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2023 Climate Report
Impact investing in emerging markets: Growing opportunities, shifting challenges
Members of our impact bond team discuss their evolving emerging markets opportunity set and the importance of a bottom-up approach to value creation.
Thematic investing focus: evolving the current generation of energy
The energy transition is taking place amid a greater focus on energy security and affordability. What could this mean for the role of traditional energy companies, ask Keith White Daouii Abouchere and Megan Galligan.
Thematic investing focus: advancing the next generation of energy
The decarbonisation process represents the biggest capital cycle in our lifetime. As we develop the next generation of energy, Keith White, Daouii Abouchere and Megan Galligan examine how thematic investors can make the most of this structural opportunity.
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See why our utilities experts see demand for large-scale batteries and flexible-power generation growing more than consensus.
When extreme weather becomes the norm: what’s next for climate investors?
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Decarbonizing while maintaining economic growth presents tremendous challenges for developing countries in Asia. Is technological innovation the solution?
Navigating the opportunities and challenges of the energy transition
Two of our climate- and energy-focused investment professionals discuss what the low-carbon transition may look like and how investors can think about the challenges and opportunities it represents.
How to invest amidst a still unfolding energy crisis?
In this ActiveViews webcast, senior climate – and energy – focused professionals explore the still unfolding energy crisis in Europe and the associated challenges and opportunities for investors.
Actively supporting the decarbonisation of utilities
Why actively supporting the decarbonisation of utilities offers the potential for better long-term outcomes from both a net-zero and value-creation perspective.
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