August 6, 2018

Investing in What We Need: Resource Efficiency

The downsides of fossil fuels are becoming ever more apparent, as we battle pollution, search for new extraction methods, and worry about declining supply. The potential for alternative energy sources to meet our energy needs in the future is becoming extremely exciting.  Bloomberg New Energy Finance estimates that renewable energy will capture most of the $11.5 trillion that will be invested in new power generation globally by 2050. 1

The race is on, looking for the next leading source: will it be solar, wind, water, or other zero-carbon technologies? In the meantime, how can we maximize the efficiency of what we have? For investors, resource efficiency and renewable energy are likely to see significant attention in the coming years, offering a wide variety of opportunities for investment growth.

Here are a few of the areas we see as potential growth opportunities in this thematic space:

  • Energy grid and infrastructure improvements: Our energy infrastructure, including the electrical grid, are terribly outdated, which creates inefficiencies and leads to wasted energy. Solutions for cost-effective improvements and updates to our infrastructure will become crucial intermediary steps toward long-term sustainability.
  • Energy generation: Innovations in solar and wind energy are bringing costs down and making these energy types feasible. We’ll need to continue to innovate devices and techniques for harvesting and storing renewably sourced energy.
  • Energy storage: Battery storage technologies that are more efficient, stable, and cost-effective are in high demand. The more we are able to effectively store the energy we can harness from alternative sources, the more we can leverage those sources.
  • Electric vehicles: With more than 2 million on the road already, carmakers are investing in electric vehicle R&D with the expectation that this will vastly increase in the near future.

Alternative energies will continue to eat into the market for fossil fuels, gaining an ever-greater share of global power generation and investment in new technologies. We are excited to share the opportunities we are uncovering in the area of resource efficiency and renewable energy.

Arnerich Massena has been focusing research on thematic impact investments in the areas of water, resource efficiency, agriculture, and life sciences – all of which we categorize as “what we need,” which we believe are going to become ever more central as the future unfolds.

Ask us about the current opportunities we are investigating – read our recent blog post about water and look for upcoming blog posts on agriculture and life sciences – and the potential they present for investors.