The Financial Times has labeled it the “Green Gold Rush,” a time when investors everywhere have started to paint their portfolios green. Whether trend or turning point, analysts say that this has resulted in the extreme overvaluation of clean energy stocks (think Tesla, Blink Charging, and Plug Power, to name a few). President Biden is pouring fuel on the fire by promising trillions to abate climate change, and the financial world is simply responding to the writing on the White House wall.
What’s at the root of these so-called crazy green energy valuations? Is it a bubble about to burst? Or is it a sign that the climate warnings are finally hitting home? Let’s ask some global renewable energy leaders.
Mainstream Renewable Power’s Group CFO Paul Corrigan and Head of Statkraft Venture’s Anders Prietz weigh in:
Group Chief Financial Officer, Mainstream Renewable Power
“All valuations will fluctuate with the wider market, but the common threads with green energy are the high growth prospects shared by most companies in the sector. One of the benefits of highly contracted infrastructure assets, such as those at the core of Mainstream’s portfolio, is the certainty of funds they provide. Successful long-term investors will base their strategy on these fundamentals much more so than on daily price changes.”
Head of Statkraft Ventures
“Cleantech investment is an area of tremendous interest these days, however the current exuberance and high valuations are not likely to last. Entrepreneurs should carefully consider pros and cons before listing their company. At Statkraft Ventures, we invest with a long-term horizon and contribute to these companies’ success by concentrating on scaling the business — not on short-term share price.”