Positive Sector Outlook

Energy and environmental issues are increasingly becoming a major concern for developed nations; receiving unprecedented media and political coverage. Governments around the globe are responding with favorable policies, regulatory mandates and incentives fueling investment and growth in the renewable and alternative energy sector. In Germany, for example, these measures are creating new industries and jobs.

Drivers for Environment and Alternative Energy investments:

Geopolitical Concerns - secure energy supply and balance energy use

Increased Demand - competition for resources particularly from the fast growing BRIC economies and the urbanization of global population.

Supply Depletion - of natural resources, particularly the reserves of oil and gas. Environmental Dislocations - Climate change stresses, loss of biodiversity, loss of arable land, reduced quality of air and water.

Government Policy - environmental mandates, waste restrictions, targets, subsidies and tax measures supporting alternative energy and efficiencies.

Economics - Balance of payment benefits, increased energy productivity and manage transportation and power costs.

According to Clean Energy Pipeline Research total investment throughout 2013 decreased 20% year-on-year to $212 billion. Total investment in the global clean energy sector has now fallen for two consecutive years. New investment in the global clean energy sector totalled $58.2 billion in 4Q13, a 15% increase on the $50.7 billion invested in 3Q13 but a 21% decrease on the $74.1 billion recorded in the corresponding period in 2012.

Renewables will surpass natural gas for electricity generation globally by 2016, doubling nuclear output and coming in second only to coal in power generation.

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Source: IEA Medium-Term Renewable Energy Market Report 2013

Sectors