Low Carbon Investment Deloitte

The global market for investment in low carbon energy companies has performed strongly in the first half of 2021, with the UK delivering 11 transactions each worth more than $50m.

According to new research by accounting firm Deloitte, there were 140 low carbon M&A deals in H1 2021.

The deals helped companies or energy suppliers move to cleaner fuels and production methods by acquiring solar, wind and other energy technologies.

Shaun Reynolds, Oil & Gas Transaction Services Partner at Deloitte, said: “Low carbon technology is becoming increasingly attractive as a core investment strategy as both governments and corporates set ambitious targets towards net zero.

“Regardless of the impact of COVID-19, low carbon M&A transaction volumes have remained steady.

“There was a pick-up in deals in the second half of 2020, showing that investors took a long-term view of the importance of the energy transition.

“I expect to see further investment in enabling technologies such as EV charging, battery storage and energy technology that will keep low carbon deal volumes on the up.”

The United States delivered the highest number of transactions in the half-year period, with 22 deals completed.

It was followed by China (19), Spain (16), the UK (11) and India (10).

South America was the least active region with only five transactions across the continent – less than 4% of global activity.

By sector, solar and wind were the most predominant, accounting for two thirds of all transactions.

James Hilburn, ESG M&A Leader at Deloitte, added: “Not only is ESG influencing business strategies and decision-making, but it is also measurably increasing asset values. 

“This activity presents both substantial risks and opportunities that can become a source of competitive advantage in the world of M&A.”

Key takeaways:

  • The investment market for low carbon energy solutions is increasingly buoyant as concerns about the impact of climate change grow
  • The UK has committed to achieving net-zero carbon emissions by 2050 and will host the UN climate conference, COP26, in Glasgow this November
  • For more inspiration around how to make your business more sustainable, head over to the UMi platform: https://www.weareumi.co.uk/webapp/
Richard Dawson
Article by Richard Dawson
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