ETF

Why Clean Energy Technology Could be a Top Trend among ETFs in 2021

Posted by MoneyController on 05.02.2021

2021 is shaping up to be the year Clean Energy takes off.  With the prospects of Biden’s green infrastructure plan on the horizon, as well as a combination of supportive policy changes and technological advancements to fuel this field, analysts remain highly optimistic regarding Clean Energy’s future. Let’s take a closer look.

Emerging technologies

As Clean Energy technology continues to improve every day, costs also go down. Nowadays, solar panels cost 80% of their initial costs and are more efficient than ever. Clean energy sources now make up around one-third of globally installed power capacity, with the goal being to reduce fossil fuel use as much as possible. There is a lot of growth opportunities in this regard for the coming decade and the ETF industry is doing a superb job of giving clean technologies good visibility in today’s market. Governments are also putting forth initiatives that include the use of Clean Energies more and more: China has doubled down on research into more effective ways to use solar energy and eliminate all carbon emissions by 2060. Spain has developed one of Europe’s most expansive electrical grids, which uses at least 60% solar power. And the UK is planning to stop using coal generated energy by 2025, as a growing share of its power comes from wind farms. 

New corporate values

Apart from Government efforts, businesses, consumers and regulators are also key players in this new area of growth, Jay Jacobs, head of research and strategy at Global X ETFs, said in a recent interview. “Investments have done well with all three interest groups,” said Jacobs, whose firm runs the Global X CleanTech ETF (CTEC). More people are installing solar panels and investing in electric vehicles and this is changing the way companies operate. The corporate world is embracing the idea of clean and environmentally safe sources of energy as part of their policies to make positive changes in the world. Businesses are quickly understanding how important environmental and social responsibility is to consumers and are now investing more and more in it. Companies are now rallying behind emerging issues, such as climate change and long-term sustainability goals, realizing that good environmental policies offer better performance and higher productivity in certain aspects.  

Clean Energies might still be in development, but they are definitely the future. 2021 could be a tremendous year for the development and adoption of green technologies that would help countries worldwide face all the new challenges that life has presented over the last few years. 

 

 

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