SUSTAINABLE INVESTMENTS – A HOT TOPIC!
As the impact of Covid-19 is being felt across various markets, the energy market is one which has not been immune to the effects of our changing habits. This is supported by the findings of a new report published by Octopus group on the impact of Covid-19 on the renewable energy market. After surveying institutional investors they found investor appetite remains as strong as ever, mirroring our current experience.
Global institutional investors expect to increase allocations to renewable energy from 4.2% to 8.3% in the next five years and increasing to 10.8% (amounting to $742.5 billion) over the next 10 years.
According to the report, with interest rates forecast to remain depressed for a while yet, more than half of global investors are looking to renewable energy as a source of stable and predictable income.
We have seen this reflected in the market in the tightening of yields applied to energy assets brought to market and through a more bullish outlook on the future hope value of schemes being repowered. The increased appetite for freehold, leasehold and operational energy assets has also seen a number of new entrants to the market, increasing competition for what is a limited number of opportunities.
Looking forward, the current green rhetoric being seen will only serve to drive the value of these investments higher. Boris Johnson’s 10-point plan, announced on the 18th of December, outlines the strategy for a ‘green industrial revolution’, with the government investing £12 billion to promote three times as much private investment by 2030. As a result, it is relatively safe to say that the renewable energy market outlook remains strong despite the recent turbulence encountered.
For many operational energy sites, such investments have now typically approached their peak value, presenting the ideal point to sell. It is important any party wishing to dispose of their energy sites or make investments seeks appropriate advice to ensure they achieve the best price possible. The Carter Jonas Energy Team is well-positioned to provide the best advice, with our strong links to active parties in the market ranging from infrastructure & pension funds through to high-net worth individuals and investors.
For more information or for advice, please contact Tom Allen on Tom.firstname.lastname@example.org or 07775 562023.