Renewables triple investor returns compared to fossils since 2010

The report looks at the performance of publicly-traded renewable energy and fossil fuel firms across four categories: global markets, advanced economies, emerging markets and China. Researchers found that renewable energy investments beat fossil fuels across every category. In advanced economies, they also found that green power investments were less volatile than their fossil counterparts. 

‘This report points to clear financial benefits from investing in clean energy transitions, an important step towards mobilising higher levels of investment from the capital markets,’ says Tim Gould, Head of Division for Energy Supply Outlooks and Investment at the IEA. ‘But much more still needs to be done to link sources of sustainable finance with the areas of greatest need.’

The report’s authors conclude that governments, companies and the global financial community all have roles to play in setting conditions, developing projects and providing the capital needed to address the investment challenge in clean energy. ‘National regulators, particularly in the United States, must get to work on the reforms needed to level the playing field for clean energy investors,’ says Dr Charles Donovan of Imperial College Business School.

According to the International Renewable Energy Agency, annual investments in renewables must triple to $800bn by 2050 to meet key warming and decarbonisation targets. The current level is around $300bn per year. 

Meanwhile, BloombergNEF has found that the current pace of investment – which would see $11trn invested in green power by 2050 – would still put the planet on course to warm 3.3°C by 2100.