New sectors and revenue streams are emerging, managed by complex algorithms, digital platforms and predictive intelligence. Integrations between buildings and transport are creating technical challenges and commercial opportunities, as their energy source is united for the first time.
Navigating the new landscape and making the right long terms decisions is the preserve and focus of the Ventum Associates energy team.
Increasingly Financial Institutions (FI’s) are being driven to become active participants in the energy transition, not so much due to regulations, but more so because of shareholder and client demand. In other words, due to market forces. Many investors, responding to their clients’ shifting attitudes, now strongly consider environmental, sustainability, and governance (ESG) factors in their investment decisions and are steering their investments to green companies and green funds.
Another major consideration for financial institutions is risk. What is the risk of investing in, or lending to, companies still focused on fossil fuels, or building infrastructure in areas that are at risk due to global warming? We are not simply talking about reputational risk for the bank, but real operational investment or credit risk. Ratings agencies, meanwhile, are already incorporating climate factors into their assessments.
Renewable energy, refurbishing plants, and adaptive technologies all require significant levels of financing. These improvements will cut carbon emissions and accelerate the transition away from fossil fuels. A growing number of banks understand this and have already acted by redefining their internal guidelines to align their loan portfolios with the aims of the Paris Agreement.
Ventum Associates has built strong relationships with the various teams in leading global FI’s dealing with energy transition, enabling us to fully understand how FI’s consider projects related to establishing a net-zero future. This creates a win-win situation for FI’s and our clients.