Green Investing in corporate bonds – for pure economic reasons
Investing in renewable energy is becoming more and more interesting for corporate bond investors. Renewables are changing the dynamics of many industries and it is creating new industries. Once distressed, traditional utilities like RWE, E.ON and Orsted have transformed themselves into robust companies with stable and predictable cash flows. They used to be highly reliant on fossil-fueled generation with high exposure to volatile European power prices. Now they are more exposed to regulated and subsidized renewables like solar plants and wind farms.
With more energy produced from renewables, funding for new infrastructure is needed. This creates attractive investment opportunities for the corporate bond investor.