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Trends Watch: Outlook for Investing in Carbon Neutral Companies

Apr 18, 2024

EisnerAmper’s Trends Watch is a weekly entry to our Alternative Investments Intelligence blog, featuring the views and insights of executives from alternative investment firms. If you’re interested in being featured, please contact Elana Margulies-Snyderman.  

This week, Elana talks with Kathi Chapman, CEO and Alex Chapman, President/Co-CIO, Ridge Creek Global.

What is your outlook for investing in carbon neutral companies?

As central banks start to discuss rates cuts, we think most of the pain from rising interest rates is behind us.  This, combined with the drop in cost of clean energy, the clarity on incentives for clean energy and storage in many countries, and concern about climate generates positivity for the future.

Where do you see the greatest opportunities and why? 

Storage is the greatest opportunity we see in the carbon neutral ecosystem.  With the cost of renewables continuing to drop, the need to store this low-cost energy is becoming a pressing issue.  Large amounts of low-cost energy require storage to balance grids; that, combined with a drop in the cost of storage technology, creates a very compelling opportunity. 

What are the greatest challenges you face and why? 

We are at the dawn of a new age of energy, creating both opportunities and challenges.  How we produce, transport, and consume energy is changing rapidly.  We now have distributed generation and storage becoming commonplace -- even electric vehicles are being used to balance grids.  Yet, the regulation for most electrical grids is based around antiquated technology, centering on base load plants.  With base load plants quickly disappearing, and some of the rules having been last changed over 50 years ago, the challenge of adjusting regulations is creating headwinds in some grid markets.

 What keeps you up at night?

The speed at which demand for carbon neutral energy systems is growing is occurring at an unprecedented rate.  To consistently take advantage of all the newly created opportunities keeps us up at night but also makes it exciting to get up every morning.   

The views and opinions expressed above are of the interviewee only, and do not/are not intended to reflect the views of EisnerAmper.

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Elana Margulies-Snyderman

Elana Margulies-Snyderman is an investment industry reporter and writer who develops articles, opinion pieces and original research designed to help illuminate the most challenging issues confronting fund managers and executives.

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