Lower interest rates signal a revival in green energy investment

finance
Created 8/30/2024
Updated 8/30/2024

UK green energy investment funds, once thriving due to low interest rates and high demand for environmental, social, and governance (ESG) strategies, have struggled as rates have risen and energy prices have stabilized. However, with the Bank of England recently cutting rates and more reductions expected, there's optimism for a revival. Lower rates could reduce the discounts at which these funds trade relative to their net asset values, potentially attracting investors back. However, challenges remain, including volatile cash flows in battery storage funds and shifting investor focus away from ESG amid economic concerns.

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