As the magnitude and impact of climate change continues to escalate, the transition to renewable energy has become imperative. The environmental benefits of gradually adopting greener and cleaner resources for energy production cannot be emphasized enough, but renewable energy developments are set to open up avenues as well countless new promising sources for investment There are many long-term opportunities that can be exploited from . For businesses, this is possible in terms of increased profitability due to financial incentives or industry support from the government. For investors, this could mean more under-the-radar investment strategies–something to help diversify their portfolios in the much-discussed ESG (environmental and social governance) space.

Headwind & tailwind in the face of change As the world transitions to renewable energy, space is now driven by more external radiation than it faces. As emissions such as high renewable energy costs and project delays continue to weigh on growth and development in the sector, we see strong demand, new incentives and improvement, and price competition acting as the main winds enabling this transformation. The COVID pandemic did cause supply chains, communication challenges, logistics restrictions, and uncertain trade patterns–affecting investment and growth in renewable energy in. But it also brought with it a sense of caution (contrary to where the world was headed) and a renewed desire to lead a more responsible life. While the cost of renewable energy may increase in the short term due to the aforementioned issues, wind and solar are now more competitive in terms of LCOE (linear cost of energy) because energy with even higher costs through common materials.

macro trends and policies that power the change The current Inflation Reduction Act (IRA) of 2022 forces the U.S. encourage manufacturers to make a rapid transition to a clean energy economy. The Act extends various benefits such as Investment Tax Credit (ITC) and Production Tax Credit (PTC) to its Green Power Partners. Expanded benefits and incentives under the bill are expected to spur new plant operations, increase investment in renewable infrastructure, and improve renewable energy supply in the US. all in -neutral credits until 2032. Although solar and wind technologies are the only major areas of focus in 2023 and 2024. There is , but the Bill also covers the energy savings associated with these areas around. Currently expensive, hydrogen as a clean energy source could become more of a priority going forward because a $3/kg tax on clean hydrogen in containers could help shift the economy in favor of producers the hydrogen atom.

Established in 1974, the International Energy Agency (IEA) currently has 31 members from developed and developing countries, renewable energy is expected to account for 90% of global energy capacity expansion in 2022-2027 and will continue to rapidly implement changes. India has increased its renewable energy target to 450 gigawatts by 2030. It aims to achieve zero-carbon electricity by 2070 and meets 50% of its electricity needs . of renewable energy sources by 2030 Under the Saudi Green Initiative, the Kingdom of Saudi Arabia is poised to achieve net zero emissions by 2060 and increase the country’s generation capacity by 50% from renewable energy sources by 2030.

Many in the investor community have long seen opportunities in helping the space become more inclusive and competitive with policy support. With investments and incentives already in place to improve the industry, one can expect strong players in the industry to at least reap positive returns for their investors entered initially Capital markets have already recognized this trend. Private market investors launched more than 330 new ESG impact funds between 2019-2022, increasing the assets under management (AUM) for these funds from $90 billion in 2019 to $270 billion by 2022 in 2010, according to a McKinsey study It’s been to billions of dollars.

conclusion There is no denying that renewable sources such as wind and solar power will generate more electricity because falling costs make it easier to replace the grid. If affordable, clean hydrogen from renewable energy could also open up new supply channels. The global renewable energy market is estimated to grow at 7.2% CAGR (2021-2030). Indeed, the rapid transition to renewable energy in the U.S. appears to be slow. in particular, primarily gaining momentum with new incentives and tax breaks Finally, the residential solar PV market in the US. alone is valued at $14.21 billion by 2022, growing at a CAGR of 15.3% (2023). – 2030) is forecast.

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