RENEWABLE ENERGY: THE 2050 REMIX Record investments still falling short markets to support the necessary infrastructure required for renewable energy expansion – such as connection to 13 While USD 1.3 trillion of energy transition investments the grid and pipelines. It is worth noting the potential to in 2022 was a record, it falls signi昀椀cantly short of what invest in private equity, which has been very involved in 14 is required. IRENA has estimated that at least USD this segment. 35 trillion needs to be invested by 2030 to meet the 1.5°C target14 – this means annual requirements of Considering renewable energy enablers: Exhibit 5 15 over USD 5 trillion globally. For renewable energies, highlights the areas of key dependency, and signi昀椀cant this equals an uplift in annual investment from USD potential investment opportunities exist, for example: 16 500 billion to USD 1–1.5 trillion . The rest (and bulk) of energy transition investments are focused on assisting • D evelopment of mass storage solutions for solar and adaptation within fossil fuels. wind energy. • Grid adaptation. In addition to expanding the scale of investment, • S ourcing of critical minerals and metals – including there is a need to increase the reach. Most renewable local, more sustainable mining, but signi昀椀cant energy investment 昀氀ows will go to solar photovoltaic opportunities could also arise in the circular economy and wind in the key markets of China, Europe, and the and e-waste solutions. US. However, there needs to be greater allocation to developing markets – Africa accounted for a mere 1% of Monitoring the evolution of disclosures: the past new renewable energy capacity installations globally year has seen increasing company disclosures on last year. the contribution of renewable energy to total energy consumption and, renewable energy targets, and The private sector has a major role to play. Public even greater granularity on location-based versus 昀椀nances have been challenged by successive crises, and market-based scope emissions. Improved disclosure will ongoing economic uncertainty could threaten the ability assist further re昀椀nement of key investment reporting 15 of governments to meet such enormous 昀椀nancing needs. requirements like “sustainable investment share” and 17 The depth and breadth of the private sector can also Do No Signi昀椀cant Harm , which should bring bene昀椀ts. ensure the fullest investment across renewable energy Similarly, it will assist the alignment of activities to the 18 sources across the world. UN Sustainable Development Goals , speci昀椀cally SDG 7: a昀昀ordable and clean energy and, even more speci昀椀cally, SDG 7.2: focused on increasing the renewable energy Investment implications of the future renewable energy mix share of the global energy mix. The gap between current and required investment is signi昀椀cant and the expectations of both public and private investments are very high. What is the answer? View our guide to investing in the energy transition: There are di昀昀erent ways to support the depth and www.allianzgi.com/en/insights/ breadth of investment required: outlook-and-commentary/ Financing renewable energy: this can be achieved energy-transition-infographic either through direct investment in projects in the private markets or through investment in companies Learn more about Allianz Global Investors’ expertise and activity in the renewable energy looking to signi昀椀cantly expand their renewable energy infrastructure. sector through Allianz Capital Partners: www.allianzcapitalpartners.com/en/ Investing in supporting infrastructure: similar to above, our-business/renewables this can be achieved through both private and public 5