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Goldman Sachs Asset Management Statement on the Russia-Ukraine War. Read it here.    

September 2021 | GSAM Connect

Fighting Climate Change: Growth Opportunities in Clean Energy Infrastructure

Extreme weather events such as this summer’s wildfires in California, Greece and Turkey as well as floods in China, Germany and Belgium highlight the devastating impact of climate change. As global decarbonisation efforts gain momentum, we believe there’s an attractive, multi-decade investment opportunity in clean energy infrastructure, which is at an inflection point for two reasons.

  1. Declining Costs
    In most places, renewables are cheaper than traditional energy sources even on an unsubsidized basis, as costs for wind and solar have declined by 80%over the last ten years. Over the next 10 to 15 years, we see the potential for further cost reduction. While energy storage challenges remain, we believe that innovation will continue, further reducing the dependency on fossil fuels and reaffirming renewables as the primary source of global energy.
  2. Policy Action
    We are seeing alignment across governments, corporations, and investors, as well as behavioural changes from consumers. Amongst these stakeholders, aggressive decarbonisation goals and net zero targets are creating long-term demand for clean energy solutions. While legislative action tends to take longer to come to fruition, we see an increased global focus ahead of the UN Climate Conference (COP26) in Glasgow later this year.

For context, a $50 trillion investment in clean energy (renewables, electrification, energy efficiency/reliability) is needed to keep emissions flat relative to today given expected population and energy demand growth around the world. Globally, $100 trillion of investment is needed to meet the Paris Agreement goals and mitigate the negative impacts of rising world temperatures.

Investment Opportunities

We see attractive risk-adjusted investment opportunities in clean energy infrastructure, where asset owners can generate potential steady, long-term cash flows backed by contracts from sovereigns or corporates, and/or earn regulated rates of return. More broadly, we believe the clean energy infrastructure sector offers the potential for secular growth and income generation, providing a compelling long-term investment opportunity.


Contact your Goldman Sachs representative if you are interested in listening to the replay of our webcast Clean Energy Infrastructure: Growth Opportunities & Risks of the Energy Transition.

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About the Author

Ben Okin

Ben Okin

Vice President, Energy Infrastructure & Renewables, Goldman Sachs Asset Management
Vikrum Vora

Vikrum Vora

Vice President, Energy Infrastructure & Renewables, Goldman Sachs Asset Management

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