Blog Big payoffs lie ahead for clean tech investors

Big payoffs lie ahead for clean tech investors
Investments in clean energy systems and efficiency improvements could be worth trillions of dollars, though exactly where to invest today isn’t always clear, according to panelists discussing global warming at the AIC on April 6.

Waste-to-energy, resource recovery, solar power and electric vehicles are among the most likely game changers. But the payoff from clean tech investments depends on the speed at which breakthroughs are introduced and how disruptive they will be.

“The argument is over the pace” of innovation, said Mark Fulton, Founding Partner at Energy Transition Advisors Pty Ltd. “Twenty years from now, I’m afraid there’s going to be a lot of stranded assets out there.”

China, for example, is investing heavily in supercritical coal technology, which burns coal far more efficiently than conventional coal plants. But that’s probably a transitional technology; meaning new plants could become obsolete in a matter of years.

“Should China ramp it down or invest more, and when should it ramp down?” said Christine Loh, Under Secretary for the Environment for the Hong Kong Special Administrative Region Government.  Or should China increase investments in carbon capture and sequestration?

Investors must also anticipate changes in government subsidies for energy programs –green or carbon-based—and breakthroughs which could drastically alter the competitive landscape. A good example is power storage research, which could lead to vastly improved battery technology in the next decade. 

“The day they announce that, you watch the stock markets move,” Fulton said.

The panel began with a video message from Ban Ki-moon, Secretary-General of the United Nations, who urged participants to actively support technologies and projects that reduce greenhouse gases and slow the pace of global warming.

“We must end our reliance on fossil fuels and embrace the promise of renewable energies,” Ban said. Trillions of dollars of new opportunities await those who invest in low carbon infrastructure and new green technologies.”

Panelists were asked what benefits, if any, could accrue from global warming? Opening new farmland in colder northern latitudes, for example, could provide income and additional food to a growing global population.

In response, Fulton noted a paper just released by researchers from the London School of Economics suggesting the cost of global warming could be as high as US 24 trillion over the next century. Coastal floods and growing deserts, for example, could cause major problems.

“There are always winners and losers,” Fulton said. “But the losers are really, really big in this game.”

Exclusive video message from Ban Ki-moon, Secretary-General, United Nations

Watch the full replay of the keynote panel discussion featuring: Christine Loh, Mark Fulton, Tessa Tennant