Climate is investment chance of a lifetime: Deutsche

LONDON Thu Jan 14, 2010 8:43pm GMT

Wind generators are seen on a farm in the countryside near the Sicilian town of Trapani, southern Italy, September 29, 2009. REUTERS/Giuseppe Piazza

Wind generators are seen on a farm in the countryside near the Sicilian town of Trapani, southern Italy, September 29, 2009.

Credit: Reuters/Giuseppe Piazza

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LONDON (Reuters) - Green technologies posed the investment opportunity of our lifetime said Deutsche Bank's global head of asset management, in a study published on Thursday.

A Deutsche Bank report found that companies specializing in energy efficiency and renewable energy such as wind and solar power outperformed peers across the wider global economy last year and expected more to come in 2010.

Clear proof of the threat posed by climate change meant that governments will only ramp up steps to curb carbon emissions and favor clean technologies, it said.

"The shift to a low-carbon economy to mitigate global warming will require the creation of new technologies, industries and jobs on a massive scale," said Kevin Parker. Deutsche Asset Management had $695 billion in assets under management as of September 2009.

"The absolute imperative to prevent climate change is therefore also, I believe, the economic and investment opportunity of our lifetime," he commented in the report.

Deutsche bankers looked on the bright side of a Copenhagen climate summit last December which failed in its main objective to drive global consensus on action to fight climate change.

Their report instead pointed to proliferating national green policies, regardless of a multilateral deal to fight climate change. Copenhagen failed to agree a mandate to agree a legally binding successor to the existing Kyoto Protocol.

"What matters far more is that national and local governments all over the world are not waiting for a supra-national framework," said Parker.

"They are already pushing ahead with their own policies that will do far more than international regulation in the short to medium term to stimulate private investment."

The report called for clearer, more transparent policies such as feed-in tariffs which typically guarantee particular prices for electricity generated from renewable sources over several decades, giving investors comfort to fund projects.

Since the 2009 low in global stocks, indices showed that energy efficiency stocks had risen 126 percent and clean energy and technology by 88 percent compared with wider global stocks' 70 percent, Thursday's report showed.

"Climate change is not merely an investment sector that may hold future promise; it is a sector that has already delivered and is continuing to deliver," said Parker.

"That is why we believe institutional investors should be shifting their asset allocation toward climate change."