According to fund managers at Schroders, the shift towards clean energy globally presents investment opportunities that are valued at a minimum of $100 trillion over the next three decades.
While the focus of investors has mainly been on artificial intelligence and technology, Mark Lacy and David Boyce believe that the clean energy sector holds immense potential. Lacy stated that the energy transition market receives more than $2 trillion in capital expenditures per year. This will result in a cumulative total of $100 trillion between 2020 and 2050.
This unprecedented influx of capital into the energy market will have transformative effects on infrastructure and investments. The growing interest in green energy investment is evident as the solar sector is predicted to attract more capital investment than oil production for the first time. Globally, solar investments are expected to surpass $1 billion per day by the end of 2023.
The International Energy Association anticipates a total of $1.7 trillion to be invested in clean-energy technologies, including EVs, renewables, and storage. Overall, global investment in energy is projected to reach approximately $2.8 trillion in the current year.
As per the IEA’s executive director, Fatih Birol, clean energy investments now surpass fossil fuel investments, with about 1.7 dollars being allocated for clean energy for every dollar invested in fossil fuels.
The clean energy transition will also create substantial wealth for workers. According to a recent report from Sattva Consulting, the renewable energy sector will create 35 million new jobs in India alone between now and 2047.
While tech stocks (especially those related to AI) have dominated the market gains this year, the potential for clean energy investment is undeniable.