The energy shock will accelerate investment in smart energy solutions

The energy shock will accelerate investment in smart energy solutions

07-10-2022 | 投資觀點

Today’s energy markets are polluting, inefficient, volatile and vulnerable. The need for an energy transition has never been clearer and will be driven by electrification of end-use applications. Investments will be costly, but resistance has been lowered by the ongoing realities of high volatility, supply disruption and the need for domestic manufacturing that is both clean and energy efficient.

  • Sanaa  Hakim
    Senior Equity Analyst

Speed read

  • Current power systems victim of and contributor to geopolitical instability
  • Electrification is key for a clean and secure energy future
  • We’re on the cusp of a new investment cycle for a complex transition

Energy markets – in transition but far from sustainable

Energy is critical for economic growth, but it is dominated by fossil fuels. Oil, coal and gas account for more than 80% of the primary energy needed to power the world’s economies. The Paris Agreement and the transition to a net-zero economy mean the shift to renewables and other low-carbon sources will accelerate in the next decade and ultimately supplant fossil fuels’ preeminence. But though momentum has increased, we cannot get there fast enough.

With 80% of total CO2 emissions, we always knew the energy sector was dirty. But the recent convergence of crises has underscored additional dangers. It is extremely inefficient; 60% of the fossil fuels extracted are wasted, with half lost in the production of electricity, and another half lost when fuels are inefficiently burned during combustion. It is highly vulnerable due to dangerous dependencies on countries rich in fossil fuels but poor at diplomacy and governance. And it is volatile; the conflict in Ukraine took energy markets off-guard, amplifying the rise in energy prices.


Clean energy requires electrification of consumption

Decarbonizing can only happen when burning hydrocarbons in engines and furnaces is replaced with racing electrons in a circuit. But that future reality depends not only on producing clean energy via renewables but also on clean consumption downstream via electric end-use applications (See Figure 1).

In order to limit extreme global warming, nearly 75% of global electricity generation must come from low-emission sources by 2030. Currently, wind and solar account for only 6% of the global mix. To reach net zero, electricity consumption needs to outgrow energy consumption by a factor of two to three in the coming decades. This will be driven not only by transport markets (via lithium-ion batteries, vehicle powertrains, green hydrogen and passenger railways), but also buildings (via electric heat pumps, HVAC and insulation), and industrial markets (via the electrification of production processes).

The world’s largest economies have already set ambitious targets to increase the share of renewables in the national energy mix, including the US where the recently passed Inflation Reduction Act (IRA) devotes nearly USD 400 billion to building up domestic renewable energy production and storage as well as clean energy use by consumers.

In order to limit extreme global warming, nearly 75% of global electricity generation must come from low-emission sources by 2030

Figure 1 | Synchronized solutions – renewable energy supplies rise to support electric consumption

Renewable energy supplies will increase to support the electrification of end use applications.
Source: BP outlook

Driving not derailing the energy transition

Meanwhile, energy security has replaced climate security as an immediate concern, especially for Europe. Russia has cut EU gas supplies as tensions over the war in Ukraine have escalated, leaving the EU desperate for energy to keep its lights on, its citizens warm and its economies churning.

In the short term, countries are reverting to fossil fuels to fill the gap, but as geopolitical tensions tighten, the crisis emphasizes the high-stakes jeopardy of an economy dependent on fossil fuels. Recognizing this, the EU has acted swiftly to further accelerate its net-zero path. Its “REPowerEU” plan further cuts energy emissions, boosts electrification of buildings and industries, and expands investment in renewable supplies and infrastructure connections across bloc economies.

But the trade-offs between energy security and climate security are complicated by current technological capacity but also political will and public sentiment, especially if consumers are forced to ration.

High energy costs create incentives

Per the International Energy Agency, in order to reach net-zero emissions by 2050, annual investment needs to double to USD 5 trillion a year. Energy costs comprise a significant share of total expenses in a variety of business models, which means a company’s energy savings often have an outsized effect on the bottom line.

The benefits of transitioning will accrue in the long term, but over the short term many firms will see significant costs, especially in hard-to-electrify industries. However, renewable production costs are falling relative to traditional energy forms (see Figure 2). And with traditional energy costs exploding, consumers and energy-intensive industries will accelerate their own energy transitions as payback periods for investments in renewable energy procurement and energy-efficient solutions shorten.

Figure 2 | Renewables – cost competitive in industry and residential settings

The levelized cost of energy from renewable sources (solar installations, geothermal and wind) are competitive and in industrial settings much lower than conventional forms of energy such as gas, coal and nuclear.
Source: Lazard

Targeted investment in electrification

Despite present challenges, electrification is at the beginning of a huge investment cycle which will spill across sectors. We believe we are reaching a turning point where governments will stop incentivising combustible fuels and encourage the adoption of technologies that facilitate economies running fully on electricity. As the fuel mix diversifies and customers are granted more flexibility, competition between energy sources will increase. This will further accelerate economy-wide shifts in renewables and electrification.

The Smart Energy team invests in companies enabling and accelerating the transition along the entire electrification value chain – from upstream companies supporting the generation of renewable wind and solar power to mid- and downstream companies creating more efficient ways to use, store and distribute it. Alongside investments in maturing technologies, the team is continuously looking for companies that can simplify and scale production of breakthrough solutions that will further accelerate the electrification of the economy.

Important information

The contents of this document have not been reviewed by any regulatory authority in Hong Kong. If you are in any doubt about any of the contents of this document, you should obtain independent professional advice. This document has been distributed by Robeco Hong Kong Limited (‘Robeco’). Robeco is regulated by the Securities and Futures Commission in Hong Kong.
This document has been prepared on a confidential basis solely for the recipient and is for information purposes only. Any reproduction or distribution of this documentation, in whole or in part, or the disclosure of its contents, without the prior written consent of Robeco, is prohibited. By accepting this documentation, the recipient agrees to the foregoing
This document is intended to provide the reader with information on Robeco’s specific capabilities, but does not constitute a recommendation to buy or sell certain securities or investment products. Investment decisions should only be based on the relevant prospectus and on thorough financial, fiscal and legal advice.
The contents of this document are based upon sources of information believed to be reliable. This document is not intended for distribution to or use by any person or entity in any jurisdiction or country where such distribution or use would be contrary to local law or regulation.
Investment Involves risks. Historical returns are provided for illustrative purposes only and do not necessarily reflect Robeco’s expectations for the future. The value of your investments may fluctuate. Past performance is no indication of current or future performance.



1. 一般事項


此網站由Robeco Hong Kong Limited(「荷寶」)擬備及刊發,荷寶是獲香港證券及期貨事務監察委員會發牌從事第1類(證券交易)、第4類(就證券提供意見)及第9類(資產管理)受規管活動的企業。荷寶不持有客戶資產,並受到發牌條件所規限。荷寶在擴展至零售業務之前,必須先得到證監會的批准。本網頁未經證券及期貨事務監察委員會或香港的任何監管當局審閱。

2. 風險披露聲明

Robeco Capital Growth Funds以其特定的投資政策或其他特徵作識別,請小心閱讀有關Robeco Capital Growth Funds的風險:

  • 部份基金可涉及投資、市場、股票投資、流動性、交易對手、證券借貸及外幣風險及小型及/或中型公司的相關風險。
  • 部份基金所涉及投資於新興市場的風險包括政治、經濟、法律、規管、市場、結算、執行交易、交易對手及貨幣風險。
  • 部份基金可透過合格境外機構投資者("QFII")及/或 人民幣合格境外機構投資者 ("RQFII")及/或 滬港通計劃直接投資於中國A股,當中涉及額外的結算、規管、營運、交易對手及流動性風險。
  • 就分派股息類別,部份基金可能從資本中作出股息分派。股息分派若直接從資本中撥付,這代表投資者獲付還或提取原有投資本金的部份金額或原有投資應佔的任何資本收益,該等分派可能導致基金的每股資產淨值即時減少。
  • 部份基金投資可能集中在單一地區/單一國家/相同行業及/或相同主題營運。 因此,基金的價值可能會較為波動。
  • 部份基金使用的任何量化技巧可能無效,可能對基金的價值構成不利影響。
  • 除了投資、市場、流動性、交易對手、證券借貸、(反向)回購協議及外幣風險,部份基金可涉及定息收入投資有關的風險包括信貨風險、利率風險、可換股債券的風險、資產抵押證券的的風險、投資於非投資級別或不獲評級證券的風險及投資於未達投資級別主權證券的風險。
  • 部份基金可大量運用金融衍生工具。荷寶環球消費新趨勢股票可為對沖目的及為有效投資組合管理而運用金融衍生工具。運用金融衍生工具可涉及較高的交易對手、流通性及估值的風險。在不利的情況下,部份基金可能會因為使用金融衍生工具而承受重大虧損(甚至損失基金資產的全部)。
  • 荷寶歐洲高收益債券可涉及投資歐元區的風險。
  • 投資者在Robeco Capital Growth Funds的投資有可能大幅虧損。投資者應該參閱Robeco Capital Growth Funds之銷售文件內的資料﹙包括潛在風險﹚,而不應只根據這文件內的資料而作出投資。

3. 當地的法律及銷售限制




4. 使用此網站



5. 投資表現



6. 第三者網站

本網站含有來自第三方的資料或第三方經營的網站連結,而其中部分該等公司與荷寶沒有任何聯繫。跟隨連結登入任何其他此網站以外的網頁或第三方網站的風險,應由跟隨該連結的人士自行承擔。荷寶並無審閱此網站所連結或提述的任何網站,概不就該等網站的內容或所提供的產品、服務或其他項目作出推許或負上任何責任。荷寶概不就使用或依賴第三方網站所載的資料而導致的任何虧損或損毀負上法侓責任,包括(但不限於)任何虧損或利益或任何其他直接或間接的損毀。 此網站以外的網頁或第三方網站皆旨在作參考之用。

7. 責任限制




8. 知識產權


9. 私隠

荷寶保證將會根據現行的資料保障法例,以保密方式處理登入此網站的人士的數據。除非荷寶需按法律責任行事,否則在未經登入此網站的人士許可,不會向第三方提供該等數據。 請於我們的私隱及Cookie政策 中查找更多詳情。 

10. 適用法律


如果您已閱讀並理解本頁並同意上述免責聲明以及同意荷寶收集和使用您的個人資料,用於私隱及Cookie政策 所列的收集和使用個人資料的目的(包括用於直接推廣荷寶的產品或服務),請點擊“我同意”按鈕。否則,請點擊“我不同意”離開本網站。