Monday, August 2

Investment experts defend the profitability of funds linked to the energy transition



«When investing, you have to expect more than financial benefits. We must also seek a social and environmental benefit. Investors should not settle for just economic returns. We must go further ». Inés del Molino, account director of Schroders, described with these words a way of invest in international markets that is becoming more and more frequent and that takes into account sustainable and social criteria, in addition to the strictly economic ones. A form of investment that is also profitable.

The expert made these statements during the first day of the II National Cycle of Conferences for Investors held last Thursday by Rent 4 Y Iberian Press that, with the title “Invest in energy efficiency”, also had the participation of Pilar Martí-Flux, Institutional Sales of JP Morgan AM; Elena Armengot, Sales Director of BNP Paribas AM; Y Rafael Luque, Advisor to the Renta 4 Ariema Hidrogen fund, as well as to the journalist Susana Created, in charge of moderating the event.

Opened the online event Isabel Pascual, Investment advisor at the Renta 4 office in Alicante, who showed optimistic about the evolution of the market in this 2021 thanks to the advance in vaccination and the recovery that is beginning to be seen in the economy. «Last year, at this time, we had a practically zero level of activity and now we are seeing how the population has savings, consumers want to spend and people are leaving, “said the expert from Renta 4.

In this sense, he pointed out that this greater dynamism is causing a GDP increase, so “we foresee an increase in inflation that we must monitor because the key will be to know if it is going to be durable or is it simply punctual». With regard to investors, Isabel Pascual pointed out that savers “are aware that risk is part of the market and now they are not asking us to make purchases disproportionately.”

Regarding the second half of the year, the expert was optimistic, like the rest of the participants in the event, who began a debate on investment funds and strategies focused on sustainability, energy efficiency and the fight against climate change and decarbonisation.

For Inés del Molino, the decarbonization It represents a strategic opportunity both from an environmental and economic point of view for investors, as it is a trend that will be present for decades to come. «We are experiencing a transformation and by 2050 we will need 43 terawatts to be able to satisfy the world energy demand when in 2020 we had 7.4 “, explained the expert.

Therefore, the investing in energy efficiency is going to be a challenge at all levels because it is transversal and affects all sectors. “The sustainability and energy efficiency They are not just the electric vehicle. It is also the way we heat our homes, the way we move around cities, the Logistics distribution or the installation of storage energy ”, said the account director of Schroders.

Along these lines, he highlighted the importance of real estate sector and Smart Cities when fighting against pollution and maximize the energy efficiency of all types of buildings, such as homes. On whether it is taken into account that on 2100 «we estimate that there will be more than 9.8 billion people on the planet of which 90% will live in cities, cities that must be smart to be sustainable».

Hence, as an investment fund, the «Schroder ISF Global Cities Real Estate» focused on real estate investment in cities with a planned urbanization project that can be very interesting from the investor’s point of view by taking into account criteria of sustainability (energy efficiency, energy storage, logistics centers, communications, universities, …) and financial criteria (per capita income, consumer spending, economic and demographic growth, etc.), also being housing «an active refuge that it has behaved very well, even in times of inflation as happens with raw materials.

Technology and sustainability

In her speech, Pilar Martí-Fluxá, from JP Morgan AM, was blunt in assuring that the «energy efficiency is the future because we have finite resources and the trend is to make better and more efficient use of those resources to pollute less ”. Thus, he predicted that the next few years will be marked by the defense of the energy transition, as corroborated by the funds Next Generation EU o la investment policy initiated by the president of USA, Joe Biden.

Regarding the possibilities for savers, the representative of JP Morgan AM disheveled that from her company they work to identify the companies that have the technologies needed to take advantage of resources that the planet has and that “they are what we need to face the climate challenge.”

In addition, he recalled that technology companies are not just the big operators like Google or Amazon, but there are many more that are capable of «developing that necessary component, such as a plate or a semiconductor, which allows energy to pass into the network and can be used by users in amore efficient and cleaner, assuming an innovation». Through the US Technology fund, JP Morgan experts study different investment possibilities in companies to “identify who are the winners in the medium and long term.”

Elena Armengot, Sales Director at BNP Paribas AM, encouraged savers and investors to not ‘miss out on the opportunities offered by the energy transition, a global phenomenon that has just begun and that is a revolution ”and pointed out that until the year 2050 there is an investment forecast in this megatrend of more than 90 billion dollars. In addition, he highlighted that China has also joined this sustainable revolution by surprising the market when it announced that it wanted to be carbon dioxide neutral by 2060.

When investing, he advised to do so in all processes that affect energy, such as production, consumption, storage or transportation, for which he pointed out that the BNP Paribas Energy Transition fund is an excellent option that grew 160% last year, being a very long-term investment fund.

Rafael Luque, advisor to the Renta 4 Ariema Hidrogen fund, finished, explained this product dedicated to hydrogen and fuel cells. Regarding green hydrogen, he highlighted that is “the only true clean fuel, which can be used without emissions, “while adding that” to decarbonize the economy, renewable energies are not enough ”.

For this reason, he defended that hydrogen “is a safe investment”, profitable in the long term, although he advised all investors to diversify.

A megatrend with which to make money investing long-term and diversifying

The participants in the round table of the II National Cycle of Conferences for Investors organized by Renta 4 did not have no hesitation in stating that the megatrend of sustainability and energy efficiency is profitable in the long term. Rafael Luque was clear on this point and assured that it is an area in which it is possible to “make money” having an investment vision in years.

In addition, he stressed that the businesses that pollute the most “are going to decrease their turnover” in a constant way and corroborated the commitment to sustainability and energy efficiency by the behavior and decisions made by world-leading companies such as Bosch, which is shifting its investment from the automotive area to solutions for the electric vehicle.

In the same vein, Inés del Molino, Director of Accounts of Schroders, considering that the challenge of the energy transition has, in principle, the 2050 year horizon to avoid global temperature rise of 2º. However, he predicted that the phenomenon and the importance of fighting climate change and reducing CO2 emissions go well beyond that date as it is closely linked to the increase in world population.

For Pilar Martí-Fluxá, «energy efficiency is the future because we have some finite resources and everything that involves making better use of the resources we have will be a priority». In addition, he advised investors to invest in the medium and long term because “it offers us more possibilities when it comes to identifying companies with stronger business modelss to generate value for shareholders ”.

Elena Armengot, Sales Director of BNP Paribas AM, estimated that investment in the global energy transition will exceed $ 90 trillion by 2050, which highlights the importance of megatrend for the future of the planet.

In addition to patience and investment in the medium and long term, the experts also recalled that diversification and betting on different sectors is essential to have a varied portfolio.


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