Global Listed Infrastructure. Building for a better tomorrow.
The passing of the Inflation Reduction Act (IRA) in the United States has brought new excitement into the renewables industry, not only in the US but also in Europe. The IRA poses as one of the most important pieces of energy legislation in the US history with an overall spending package of $739 billion, earmarking $369bn dedicated to the twin challenges of fighting climate change and providing energy security.
This has also driven European policymakers to set-up their support for clean energy and green industries, with the European Commission recently announcing a “Green Deal Industrial Plan” that intends to stimulate investment in the “net-zero industry” within the EU.
Figure 1: Infrastructure is at the heart of the Inflation Reduction Act
Owners and developed of integrated networks, renewable and nuclear infrastructure, transmission grids and emerging technologies are key beneficiaries of the inflation reduction act (IRA).
IRA Highlights
$739 billion of planned spending
$369 billion related to climate change and energy security
Tax credits extended for 10 years+ designed to incentivize energy infrastructure investment
Likely multiplier effect of bill
Benefits to infrastructure companies and benefits to consumers
These packages are intended to accelerate the green energy transition and within the infrastructure asset class we find companies that are essential to accomplish the IRA’s dual mandates of decarbonization and energy security.
Globally, infrastructure companies lead the development of wind and solar power, the upgrading of transmission assets, the operation of baseload nuclear generation and the development of technologies such as battery storage, electric vehicle charging, hydrogen electrolysis and carbon capture/storage.
As such, these infrastructure companies will benefit from the Inflation Reduction Act – and similar legislative packages – since we will have a decade plus worth of investment new tax credits for carbon capture, hydrogen, battery storage and EV charging, which should improve significantly the fundamental business case for investment in these emerging technologies and attract the capital required to build these technologies at scale.
For established technologies such as wind and solar energy generation, the duration of tax credits and associated visibility should also drive yet more investment.
Nordea 1 - Global Listed Infrastructure Fund
CBRE Investment Management, the fund’s sub-manager, brings:
- more than 30 years’ expertise in managing real assets and
- one of the best-resourced research teams in the industry maximising analysis
- across private and listed markets.
- aging assets
- decarbonisation
- data
CBRE’s investment universe is inclusive of the global opportunity set
For illustrative purposes only
Wide investment universe provides greater diversification and growth opportunity than typical benchmarks.
Stable, cash-generative and inflation-protected asset class with multiple tailwinds for growth.
