Covid-19 accelerates the transition to a green future

A survey carried out by Octopus Renewables has found that institutional investors’ hope that the Covid-19 pandemic can lead to increased investment in renewables. Leading Renewables Investment Firm said that the coronavirus had allowed more green investment since the investors, businesses, and governments focused on handling climate change. 

Octopus Renewables said that the Paris Agreement would be achieved if more funds would be used in renewable power production and technologies. Co-head of Octopus Renewables, Alex Brierley, said that coronavirus could be a catalyst to renewables for a more sustainable future. But for this to happen, there needs to be good cooperation between governments, banks, specialist power fund managers, energy companies, and institutional investors. 

The majority of institutional investors have agreed with the Octopus findings that the Covid-19 pandemic has sped up the climate change fight. Also, many still hope that the crisis will accelerate decarbonization policies implementation. 

Alex said that the pandemic has a positive impact on the environment. A huge carbon emissions reduction was witnessed in early 2020 as fewer planes took off, many factories shut down, and most people worked from home, making the roads clear. Also, energy demand decreased, and oil prices fell. Octopus Renewables said that this year, Europe produced more power from renewable sources compared to fossil fuels. Governments are urged to lay down measures on how to deal with coronavirus; they should also impose policies to deal with climate change.

Many governments have started doing so. For instance, the UK has a Build Back Greener plan that intends to make the UK the wind energy leader. The EU’s recovery proposal aims to use 30% of its finances for long-lasting and low-carbon technologies. 

Octopus Renewables said that due to government measures and public demand, over 80% of institutional investors are willing to increase their renewable power investments in the coming years. This shows that clean power remains a desirable asset, hoping the invested funds will yield better returns. Many investors want to shift their monies from fossil fuels. They are looking forward to divesting from the gas and oil sector. 

However, as many investors are willing to invest more in renewable energy, some challenges hinder them. The first is the lack of liquidity in renewable power investments. This is because after installing solar and wind farms, the money used to build these farms is locked up for some time. Also, investors say there is a great need for more international policies, saying if this does not happen, it will be a bit difficult to push for renewable space innovation.

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