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Jim fink investingdaily review1/31/2024 Ten years ago, Orsted was the Danish oil and gas company, the largest Danish thermal power generator. Importantly, ENEL is a major investor in emerging markets, bringing in Western capital to solve the climate and energy problems as per the Paris Agreement. It is targeting a trebling to 15,000 megawatts of renewable installs a year by 2030. Italian utility ENEL is the world’s second largest investor in renewable energy, and has outperformed the Italian market.ĮNEL plans to invest a staggering €210 billion this decade including capital recycling in renewable energy and grid and batteries. Take for example US-based NextEra Energy, the world’s biggest renewable energy investment firm, which has massively and consistently outperformed the US market over the past decade, and extrapolating its current forward plans will invest some $200 billion over this decade.Įxxon, the US’s biggest fossil fuel company, has consistently underperformed in the US equity market. Now, the evidence that it presents a multi-trillion dollar opportunity is incontrovertible. Only three or four years ago, Fink was denying any moral or fiduciary responsibility to decarbonise. In 2021 it co-invested in a decarbonisation platform with Singapore sovereign wealth fund Temasek and launched a number of new global infrastructure funds. BlackRock CEO Larry Fink has made an about-face when it comes to decarbonisation.īlackRock plans to spend $1 billion in Australia after acquiring Melbourne-based Akaysha Energy, which is building out nine battery proposals across Australia, one of BlackRock’s first global moves into battery infrastructure investment. Larry Fink, CEO of $US8.5 trillion BlackRock, the world’s largest asset manager and financial institution, talks about an accelerating tectonic shift, and he’s backing it in. These will play a key role in mobilising capital, with the Climate Bonds Initiative projecting green bonds could grow to potentially $5 trillion a year by 2025. Green bonds are building momentum, too, with global bond issuance exceeded half a trillion dollars in 2021 after strong growth over the past two to three years. Here in Australia, responsible investment accounts for $1.5 trillion or 43 per cent of the total market. Significantly, we’ve seen major investors sign up to the Glasgow Finance Alliance for Net Zero, which now has a collective $US130 trillion of capital pledged to investing in line with a 1.5 degrees Celsius trajectory. That number is projected to be $US4 trillion a year by 2030, a cumulative $US100 trillion by 2050.Īnd while China is currently the world’s leader in renewable investment (including green hydrogen, solar and wind manufacturing and hydro), electric vehicles, rare earth processing and nuclear, spending more this year on renewable energy than all other developed countries combined, the flow of green capital is global. The International Energy Agency (IEA) says the world will spend $US2.4 trillion in 2022 on energy sector finance. The EU’s Emissions Trading Scheme leads the world, with carbon emission prices averaging €80 ($119) per tonne this year, up 300 per cent in just two years and nearly tenfold in five years.Īnd just last month, Mr Biden’s IRA put a massive $1500-a-tonne price on methane emissions. Increasingly, too, governments are pricing in the externalities – the cost burden of greenhouse gas emissions on the environment and human life. Secondly, there is growing global climate and energy policy momentum, most recently apparent in US President Joe Biden’s Inflation Reduction Act (IRA), and the minimum 43 per cent cut in carbon emissions on 2005 levels by 2030 enshrined a few days ago in Australia’s climate bill. With fossil fuel hyperinflation in 2022, the competitiveness of deflationary renewables has never been more evident. Photo: APĪ number of other key factors are also spurring decarbonisation.įirstly, we are seeing a long-duration downward trend in renewable energy prices – solar and wind, and more recently batteries and electric vehicles. Fires like this French inferno are scorching the planet with unprecedented frequency and ferocity.
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