Executives at companies across 20 major economies see the Ukraine conflict speeding up the pace of the transition to cleaner energy, rather than slowing it down, a survey by Britain-based law firm Ashurst found.
The findings counter fears that bans on Russian natural gas following its invasion of Ukraine, which Moscow calls a special operation, are driving up demand for coal for heat and power generation and hampering investment in wind and solar power.
“The need to ensure greater energy security made evident by the crisis is likely to lead to a quicker energy transition, not a slowdown,” Ashurst said in a report released on Wednesday.
More than 75 per cent of 1,999 senior executives surveyed across Group of 20 (G20) countries expected the Ukraine conflict would speed up energy transition in their country, while 12 per cent predicted it would slow transition, Ashurst said.
Companies and banks were driving investment in renewable power, particularly in such countries as Brazil, India and China, with government funding having dropped to fourth place from the top spot last year, the survey found.
That trend is expected to shift further, with survey respondents saying they expected funds, not corporates, to be the leading new investors in renewable power in their country in the next five years, particularly in the Asia-Pacific region.
However infrastructure investor Quinbrook sees renewable energy investments slowing in Australia over the next two years as unpredictable energy prices threaten returns and equipment shortages delay projects.
“So next year will be pretty lean in terms of investment numbers, despite all the headline activity that’s around,” Quinbrook Infrastructure Partners co-founder David Scaysbrook said at a briefing on Tuesday.
Ashurst ran its third survey of senior executives involved in energy decision-making at state-owned enterprises, publicly listed companies and private companies across the G20 countries between June 22 and July 7.
That was before the United States passed the Inflation Reduction Act (IRA), which provides billions of dollars in tax credits for renewable energy, possibly sapping investment from other countries.
“The IRA has doubled down on incentives for investing in America,” Scaysbrook said.
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