COP29 and the Business of Clean Energy: Investing in a Profitable and Sustainable Future
For nearly 30 years, COP summits have been a gathering place for international policy makers to debate and agree ways to tackle climate change, an global issue that is impacting the way we live. Yet, while the data and the rise in extreme weather events continues to increase, the message to some is still sadly not landing.
Previous summits and all the conversations in between have focused on reducing emissions targets, an issue that certain industries have fought and lobbied hard against because of the ‘perceived’ job losses and economic instability tied to reducing fossil fuel usage.
Yet, quietly, while all eyes, debate and disagreements have focused on weaning the world from the use of fossil fuels, in the background, we have been seeing a rise in clean energy options and technology. A new industry that as it scales is able to deliver energy and much more at a reduced cost, an issue that the business community around the world can better relate with.
Today, clean energy and clean-tech is not only a a viable alternative but also a profitable one too, which is why renewable energy is attracting attracting private capital, with institutional investors and corporations recognising climate action not as a regulatory burden, but as a compelling economic imperative.
Renewables have reached scale, which is why at COP29, dubbed the ‘Financial COP’, in Baku, Azerbaijan, the conversation has shifted to one of decarbonisation can reshape the global economic landscape.
As global leaders gather to discuss climate action, the focus has shifted from purely environmental concerns to the compelling business case for clean energy investments that can deliver jobs and growth in markets that lead the way in this new industry.
The Rise of Clean and Renewable Energy
Renewable energy sources are now cost-competitive with, or even cheaper than, traditional fossil fuel-based power generation. This, and the advancement of renewable and clean-tech technology, is giving it the necessary economies of scale with which to grow in developed nations.
While the global transition to a low-carbon economy has been slow to start with, emerging evidence from advanced economies show a more nuanced picture of where the world is.
Several high-income countries, despite their historically large carbon footprints, are demonstrating that rapid decarbonisation is technically and economically possible. Denmark has pushed renewable energy to over 50% of its power generation, while the UK has cut emissions faster than any other major economy since 1990 and while these countries currently represent only a fraction of global emissions, their trajectories offer practical blueprints for accelerating the energy transition at scale.
Emerging economies confront a complex development imperative: the need to expand energy access and strengthen healthcare systems while simultaneously pursuing low-carbon growth. This stands in contrast to the historical industrialisation of developed nations, which relied heavily on fossil fuels. For countries across South Asia and Africa, where hundreds of millions still lack reliable electricity, the challenge is to accelerate economic development through clean energy pathways – a transition that requires capital and access to clean and renewable energy at an affordable cost. The success hinges on the cost and the financial support to help deliver cheap renewable energy, something that is becoming a geo-political issue given the strength and influence of China’s renewable sector.
For nearly 30 years, COP summits have been a gathering place for international policymakers to debate and agree on ways to tackle climate change, a global issue that is impacting the way we live. Yet, while the data and the rise in extreme weather events continue to increase, the message to some is still sadly not landing.
Previous summits and all the conversations in between have focused on reducing emissions targets, an issue that certain industries have fought and lobbied hard against because of the ‘perceived’ job losses and economic instability tied to reducing fossil fuel usage.
Yet, quietly, while all eyes, debate, and disagreements have focused on weaning the world from the use of fossil fuels, in the background, we have been seeing a rise in clean energy options and technology. A new industry that, as it scales, is able to deliver energy and much more at a reduced cost, an issue that the business community around the world can better relate to.
Today, clean energy and clean-tech are not only viable alternatives but also profitable ones, which is why renewable energy attracts private capital, with institutional investors and corporations recognising climate action not as a regulatory burden but as a compelling economic imperative.
Renewables have reached scale, which is why at COP29, dubbed the ‘Financial COP’, in Baku, Azerbaijan, the conversation has shifted to one of how decarbonisation can reshape the global economic landscape.
As global leaders gather to discuss climate action, the focus has shifted from purely environmental concerns to the compelling business case for clean energy investments that can deliver jobs and growth in markets that lead the way in this new industry.
The Rise of Clean and Renewable Energy
Renewable energy sources are now cost-competitive with, or even cheaper than, traditional fossil fuel-based power generation. This, and the advancement of renewable and clean-tech technology, is giving it the necessary economies of scale with which to grow in developed nations.
While the global transition to a low-carbon economy has been slow to start with, emerging evidence from advanced economies shows a more nuanced picture of where the world is.
Several high-income countries, despite their historically large carbon footprints, are demonstrating that rapid decarbonisation is technically and economically possible. Denmark has pushed renewable energy to over 50% of its power generation, while the UK has cut emissions faster than any other major economy since 1990, and while these countries currently represent only a fraction of global emissions, their trajectories offer practical blueprints for accelerating the energy transition at scale.
Emerging economies confront a complex development imperative: the need to expand energy access and strengthen healthcare systems while simultaneously pursuing low-carbon growth. This stands in contrast to the historical industrialisation of developed nations, which relied heavily on fossil fuels. For countries across South Asia and Africa, where hundreds of millions still lack reliable electricity, the challenge is to accelerate economic development through clean energy pathways – a transition that requires capital and access to clean and renewable energy at an affordable cost. The success hinges on the cost and the financial support to help deliver cheap renewable energy, something that is becoming a geo-political issue given the strength and influence of China’s renewable sector.
The Financial Case for Clean-Tech and ESG Investments
Success is about the money - the investment, the price point and the influence. According to BloombergNEF, renewable energy represents a staggering $7 trillion investment opportunity by 2030.
Success is also about strategy, positioning, effective strategic communication, and engagement with stakeholders.
The International Renewable Energy Agency (IRENA) reports that renewable energy projects consistently outperform fossil fuels in terms of ROI, with utility-scale solar and wind offering returns between 10% and 15% annually.
Key growth sectors include:
Solar power: Projected to triple in capacity by 2027
Wind energy: Expected to grow by 680 GW between 2022-2027
Green hydrogen: Market anticipated to reach $700 billion by 2030
Energy storage solutions: Forecasted to reach $426.1 billion by 2030
Focusing on the financials and the return on investment can help focus the mind and help secure the adoption of these new clean energy technologies.
Perception Challenges: Clean Energy as a Business Opportunity
Yet, despite compelling financial data, the clean energy sector faces persistent perception challenges. Many investors and business leaders still view renewable energy through an outdated lens, considering it:
Too costly compared to traditional energy sources
Heavily dependent on government subsidies
Technologically unreliable
A ‘nice to have’ rather than a core business imperative
These misconceptions persist despite evidence showing that renewable energy is now often cheaper than fossil fuels, with the International Energy Agency (IEA) reporting that solar power is ‘the cheapest electricity in history’ in most major countries.
And, with Donald Trump winning the US Election, the USA and the world are at a crossroads because while his “Drill, Baby, Drill” comment might appeal to his base, some in the oil industry do not want such a strategy. Market analysts are stating that what shareholders want is, ‘dividends and buybacks just as much as they want volume growth.’ But the risk of drilling for more oil is that it increases the risk of the price dropping, something that shareholders might not want.
Strategic Communications to Reposition Clean Energy as Wealth Creation
As I said in a previous article in which I focused on the challenges of the in-coming Trump administration, clean energy needs to be repositioned as a ‘wealth creation’ opportunity. It needs to relate to what the new US government wants to deliver - jobs, safety and affordable living first.
There is a strategic need and opportunity to reframe the renewable and clean energy narrative around the interests on decision-makers. Success stories abound:
Ørsted transformed from a traditional oil and gas company into the global leader in offshore wind, delivering a 28% average return to shareholders from 2019-2023
NextEra Energy's market capitalisation exceeded that of ExxonMobil in 2020, demonstrating the market's growing confidence in renewable energy business models.
Tesla's success has sparked an electric vehicle revolution, with traditional automakers now racing to electrify their fleets.
Companies in renewable energy and clean-tech are creating jobs and a return for investors and shareholders.
https://www.nytimes.com/2024/11/12/business/energy-environment/exxon-mobil-baku-climate-cop29.html
Long-Term Opportunities: Sustainable Growth through Clean-Tech
The transition to clean energy is creating entirely new industries and opportunities:
Grid modernisation could require $14 trillion in investment by 2050
Electric vehicle charging infrastructure market is expected to reach $111.90 billion by 2028
Carbon capture and storage (CCS) market is projected to grow from $2.01 billion in 2021 to $7.0 billion by 2028
From Perception to Action
The clean energy transition represents one of the largest investment opportunities of the 21st century. To capitalise on this opportunity, businesses must:
Adopt data-driven communication strategies that emphasise financial returns
Highlight successful case studies of clean energy transformation
Focus on the innovation and wealth-creation potential of clean technologies
Integrate clean energy investments into core business strategy rather than treating them as peripheral ESG initiatives
The path to net zero is not just an environmental imperative - it's a compelling business opportunity. Companies that recognise and act on this reality will be best positioned to thrive in the low-carbon economy of the future.
Saving the world requires influence and in this case focusing people on the economy and the cash return that clean energy and technology can deliver. And this is what COP29 will be talking about.
