The transition to a clean energy future is gathering pace and requires trillions of dollars of investment in the decade ahead. Bloomberg NEF estimate that US$500 billion was spent in 2020, up 9% on 2019 despite COVID-19. We believe that this will be one of the defining investment themes of our lives/careers.

Renewable energy investment has been growing globally for many years. More recently, global attention has turned to electrified transport, focusing on electric vehicles (EV) in particular. Declining EV production costs, government purchase incentives and regulatory caps on carbon emissions are driving the increase in adoption.

China had led demand for the past decade, with government support and stimulus supporting uptake. In a surprising twist, in part driven by COVID-19, China was overtaken by Europe in the last quarter of 2020 for total number of vehicles sold. We see the expansion of EV demand to a global scale as providing significant confidence that the EV transition is now firmly underway.

 

Read the full article on the Paradice Investment Management website here.