Goldmand Sachs: investments in renewable energies cannot be at the expense of those in traditional sources
Michele Della Vigna, head of natural resources research at Goldman Sachs, told Bloomberg on Monday: "The focus on decarbonization is correct, but I believe it needs to be driven by more investment and not divestment (in other sectors)." “The key is to move from divestment of oil and gas to increased investment in renewable energy and low carbon emissions.”
According to Della Vigna, ESG investors need to rapidly scale up investments in renewable energy to avoid a collapse in overall energy supply.
The investment bank expects capex for energy to rise 15% in 2023, or even 30%, factoring in inflation.
“ What needs to happen is an acceleration of spending on renewables on the one hand, but also a normalization of spending on hydrocarbons on the other ,” Della Vigna told Bloomberg.
Earlier this year, the CEO of the world's largest oil company, Saudi Aramco, said ESG investing, if biased completely against the oil and gas industry, poses a threat to the accessibility and energy security.
“In my opinion, a greater emphasis on ESG is a move in the right direction,” Saudi Aramco Chief Executive Officer Amin Nasser said in February.
“However, if ESG policies are implemented with an automatic bias against all conventional energy projects, the resulting underinvestment will have serious implications. For the global economy. For energy accessibility. And for energy security,” added the top Aramco executive.
Last month, the International Energy Agency (IEA) said investment in solar power generation is set to surpass that in oil production in 2023 for the first time ever. For 2023, the IEA projects total energy investment will be $2.8 trillion, of which $1.74 trillion will be for energy and clean technologies and the remaining $1.05 trillion to fossil fuels.
“For every dollar invested in fossil fuels, approximately $1.7 is now allocated to clean energy. Five years ago, this ratio was one to one,” said IEA Executive Director Fatih Birol.
The problem, according to Goldman Sachs, is that if the extra investment in renewables takes place at the expense of traditional ones, there is the risk of laying the foundations for a new energy crisis. Evidently renewables are not considered as stable as the traditional ones, therefore the development of the former cannot take place at the expense of the latter.
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The article Goldmand Sachs: investments in renewable energies cannot be at the expense of those in traditional sources comes from Scenari Economici .
This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/goldmand-sachs-gli-investimenti-nelle-energie-rinnovabili-non-possono-essere-a-scapito-di-quelli-nelle-fonti-tradizionali/ on Mon, 05 Jun 2023 14:28:50 +0000.