Highlights from 2023
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Entering the next phase of green growth
Despite financial volatility, the green economy continues to expand and diversify steadily, and is becoming an important source of economic growth, jobs and energy supply. It has also emerged as a critical geopolitical consideration. The FTSE Russell 2023 Report, provides a holistic picture of the green trends in the global equity market, green equity performance, and the geopolitics of green.FTSE Russell 2023 Report
According to this report, as a stand alone sector, the green economy is now the fourth largest sector in global equity markets, with a combined market capitalisation of US$6.5 trillion. It recently surpassed Banks and is now materially bigger than Energy (including Oil & Gas) and the Retail sectors. Green revenues for listed companies are on track to exceed US$5 trillion by 2025, which is double the size since the conclusion of the Paris Agreement in 2015. The market capitalisation of the green economy is approaching 10% of the equity market. Acknowledging to shift the global economy onto a 1.5°C trajectory, green growth will have to further substantially accelerate approximating 20% of global equity markets by 2030.2023 Ethical Advisers Co-op Annual Report
We are proud to be a part of the recent launch of the Ethical Advisers’ Co-operative’s fourth Annual Report, which showcases’ the important efforts the Co-op has made throughout 2023. The report highlights the engagement activities, ethical fund ratings and member events that are lifting the finance industry and spreading the word to more investors.
Access the Annual Report
Battery storage – the backbone of a renewable energy future
Renewable energy and electrification have the potential to reduce energy-related CO2 emissions by 75%, which is necessary to keep global temperature increases “well below” 2°C. Can the infrastructure cope?
Wind and solar energy sources are variable and decentralised, which poses significant challenges for the existing electricity network that was designed around stable and centralised power generation sources.
What makes a grid smart? Some of the solutions to these challenges to the grid can be found in the Funds we invest in, including smart grid technology, battery storage solutions, electric vehicle (EV) charging, and semiconductor technology. A smart grid for example is fitted with information and communications technologies (ICTs) to enable a real-time, two-way communication between suppliers and consumers. This creates a more dynamic interaction in energy flow, which helps to deliver electricity more efficiently and sustainably. Smart grid technologies like semiconductor technology enables wireless communication and the Internet of Things (IoT). The connectivity they provide in smart meters, EV chargers, and solar panels is a key enabler of communication with the grid.The role of storage The latest Quarterly Energy Dynamics report from the AEMO (Australian Energy Market Operator) reveals that batteries took a 50% share in the provision of key services to the grid, up from 38% a year earlier. As the grid decarbonises and becomes more complicated, struggling to meet the demand for electricity, storage is required to balance this demand and supply and maintain the integrity of the grid. The energy transition will require a mix of technologies, as there is no single perfect form of energy storage. Some deep storage (providing supply during prolonged system stress, supply disruption or seasonal variability) is required for ‘dark and still’ periods when solar and wind output is less than is demanded for an extended period. According to AEMO modelling, building enough wind and solar to meet the energy needs is likely to be more efficient, on estimated technology costs, than building less wind and solar but more seasonal storage. The task now is to integrate these solutions into the existing infrastructure to ensure a smooth transition to renewable energy and electrification. In our next newsletter we will look at these ‘deep’ storage solutions – Hype vs reality. source: Pengana WHEB, Betashares Insights, AEMO