This is Dana Perkins and you're listening to Switched on the bn EF podcast. Every year, BNF releases its Energy Transition Investment Trends Report, which is our definitive resource on global investment in the low carbon energy transition and the sectors that are central to it. Since twenty fourteen, when b and EF tracked three hundred and thirteen billion in transition investment volumes, we have seen continuous and rapid annual growth that broke through the one trillion dollar mark in twenty twenty one and reached a record one point five trillion in twenty twenty two. So how about twenty twenty three, will it be another record year for energy transition investment and which sectors saw the greatest growth and perhaps declines. To discuss the findings for the Energy Transition Investment Trends Report today, I am joined by BNF's Deputy CEO, Albert Chung and the head of Technology and Innovation Mark Daily. Together, we look at which sectors received the largest volumes of investment in twenty twenty three and whether the renw global energy industry, which has historically been the main driver, was able to hold off electric vehicles at the top of the table, we also review global clean tech supply chain investment and following booms in protection capacity, we want to know whether they've already achieved the investment required to meet twenty thirty net zero targets for battery and solar factories. And finally, we review if climate tech equity financing rebounded last year following declines in twenty twenty two, and for the first time, we review a new category debt issuance for the energy transition. To access the Energy Transition Investment Trends report, B andF subscribers can find it on BENF dot com or at benfgo on the Bloomberg terminal. If you like this podcast, make sure to subscribe, and if you want to make it discoverable by other people, give us a review on Apple Podcasts or Spotify. But right now, let's hear from Albert and Mark about the Energy transition investment trends for twenty twenty three. Mark, thank you for joining today.

This is Dana Perkins and you're listening to Switched on the bn EF podcast. Every year, BNF releases its Energy Transition Investment Trends Report, which is our definitive resource on global investment in the low carbon energy transition and the sectors that are central to it. Since twenty fourteen, when b and EF tracked three hundred and thirteen billion in transition investment volumes, we have seen continuous and rapid annual growth that broke through the one trillion dollar mark in twenty twenty one and reached a record one point five trillion in twenty twenty two. So how about twenty twenty three, will it be another record year for energy transition investment and which sectors saw the greatest growth and perhaps declines. To discuss the findings for the Energy Transition Investment Trends Report today, I am joined by BNF's Deputy CEO, Albert Chung and the head of Technology and Innovation Mark Daily. Together, we look at which sectors received the largest volumes of investment in twenty twenty three and whether the renw global energy industry, which has historically been the main driver, was able to hold off electric vehicles at the top of the table, we also review global clean tech supply chain investment and following booms in protection capacity, we want to know whether they've already achieved the investment required to meet twenty thirty net zero targets for battery and solar factories. And finally, we review if climate tech equity financing rebounded last year following declines in twenty twenty two, and for the first time, we review a new category debt issuance for the energy transition. To access the Energy Transition Investment Trends report, B andF subscribers can find it on BENF dot com or at benfgo on the Bloomberg terminal. If you like this podcast, make sure to subscribe, and if you want to make it discoverable by other people, give us a review on Apple Podcasts or Spotify. But right now, let's hear from Albert and Mark about the Energy transition investment trends for twenty twenty three. Mark, thank you for joining today.

Thank you very much, lovely to be here.

Thank you very much, lovely to be here.

Dana and Albert, thank you for coming back on the show.

Dana and Albert, thank you for coming back on the show.

Thanks for having me.

Thanks for having me.

So we're here talking about the energy transition investment trends for this previous year. And the first thing I really want to know is what question were we trying to answer when we look at energy Transition Investment trends? What are you hoping to find when putting that data together and having a moment to kind of take a step back and give it an annual refresh.

So we're here talking about the energy transition investment trends for this previous year. And the first thing I really want to know is what question were we trying to answer when we look at energy Transition Investment trends? What are you hoping to find when putting that data together and having a moment to kind of take a step back and give it an annual refresh.

So, Energy Transition Investment Trends is this report we do every year. We've done it every year since I've been at the firm, which is fifteen years, and the data goes back twenty years. And the question we're trying to answer is where is the money flowing in the low carbon transition? And you know, we've always had this philosophy at New Energy Finance back in the day and BNF over the last decade at a bit that if you follow the money, it tells you a lot about where the opportunities are, It tells you where the interest is, it tells you where the action is, and also tells you whether you're going fast enough. And that's we exploring the report as well.

So, Energy Transition Investment Trends is this report we do every year. We've done it every year since I've been at the firm, which is fifteen years, and the data goes back twenty years. And the question we're trying to answer is where is the money flowing in the low carbon transition? And you know, we've always had this philosophy at New Energy Finance back in the day and BNF over the last decade at a bit that if you follow the money, it tells you a lot about where the opportunities are, It tells you where the interest is, it tells you where the action is, and also tells you whether you're going fast enough. And that's we exploring the report as well.

So investment is a broad term. Can you define what exactly we're looking at when we're following the money?

So investment is a broad term. Can you define what exactly we're looking at when we're following the money?

Yeah?

Yeah?

Sure. So in the report we track four different types of funding flows. The biggest category is what we call energy transition investment, and that's money being spent to deploy clean technology and infrastructure, so renewable energy plant, electric vehicles, and so on. Then we have clean energy supply chain investment, and that is money being spent to build factories for wind and solar equipment, hydrogen electrialized as batteries, and also mines and refineries for battery metals. So that's category two. Category three is climate tech equity raising or equity finance, and that's new equity being raised by companies in the climate and energy transition space. And then finally, the fourth area, which is new this year we haven't done before, is debt issuance for the energy transition. So that's debt being raised by companies and by governments for energy transition purposes to fund operations in clean energy or to fund investment into clean energy projects.

Sure. So in the report we track four different types of funding flows. The biggest category is what we call energy transition investment, and that's money being spent to deploy clean technology and infrastructure, so renewable energy plant, electric vehicles, and so on. Then we have clean energy supply chain investment, and that is money being spent to build factories for wind and solar equipment, hydrogen electrialized as batteries, and also mines and refineries for battery metals. So that's category two. Category three is climate tech equity raising or equity finance, and that's new equity being raised by companies in the climate and energy transition space. And then finally, the fourth area, which is new this year we haven't done before, is debt issuance for the energy transition. So that's debt being raised by companies and by governments for energy transition purposes to fund operations in clean energy or to fund investment into clean energy projects.

What was the reason to add debt, It was really.

What was the reason to add debt, It was really.

The missing piece of the puzzle. The first two categories are you know, think about the energy transition investment and the clean and just supply chain investment. Those are kind of real assets being built on the ground. And the last two debt and equity are how is the money being raised to fund those things? And so we always had the equity piece, We've had that for many years, and we just wanted to add in the debt piece to really round out the whole picture.

The missing piece of the puzzle. The first two categories are you know, think about the energy transition investment and the clean and just supply chain investment. Those are kind of real assets being built on the ground. And the last two debt and equity are how is the money being raised to fund those things? And so we always had the equity piece, We've had that for many years, and we just wanted to add in the debt piece to really round out the whole picture.

So if we're not talking about emissions in whether or not we're going at the rate of change that is required to achieve certain outcome, we're really thinking about how much money is going and how it compares to previous years. So if we're looking at this volume of money in many years in absolute terms, these are new records being set. So if we're comparing twenty twenty three to other years, would you consider it to be a good year in terms of overall investment? And I guess we can break it down into some of the different areas that you're specifically looking at.

So if we're not talking about emissions in whether or not we're going at the rate of change that is required to achieve certain outcome, we're really thinking about how much money is going and how it compares to previous years. So if we're looking at this volume of money in many years in absolute terms, these are new records being set. So if we're comparing twenty twenty three to other years, would you consider it to be a good year in terms of overall investment? And I guess we can break it down into some of the different areas that you're specifically looking at.

Yeah, definitely, So just looking at the energy transition investment piece, deployment of clean tech, deployment clean infrastructure. It's a really good news story. We saw one point eight trillion dollars invested in twenty twenty three. That one point eight trillion is really the headline number that we that we lead with, So if you're listening, remember that that's the number that matters. That one point eight trillion dollars is up seventeen percent since the year before, since twenty twenty two. It's almost doubled since twenty twenty which is only three years ago. So you know, it gives you an idea of the pace of change in the energy transition. And that one point it trillion is not only a record year in twenty twenty three, but it's the tenth record year in a row. So again that gives you something of an idea of the size and scale and momentum of the opportunities in the energy transition. I can say a bit about the individual sectors because within that one point eight trillion, there are ten different sectors that we track. I'm not going to talk about all of them, but the largest this year is electrified transport, and that's all of your sales of evs including two and three wheelers, cars, buses, trucks, the associated charging infrastructure for all of those as well, and a small amount of hydrogen fuel cell vehicles as well in there. That's now six hundred and thirty four billion, so it's like a third of the total energy transition spending. It jumped thirty six percent last year, which is really great. I mean, shows how fast the EV transition is going, and it overtook renewable energy. For years and years, as long as we've been doing this, renewable energy was the largest sector. Transport is now the largest sector, and I think that was really interesting. But renewable energy also had a good year. Renewbal energy is up eight percent this year. It's now I think six or twenty three billion, to be exact. And one of the kind of underreported stories within the data is that the wind sector actually had a record year of investment in twenty twenty three. Despite everything we saw around project cancelations of us offshoal wind projects, failed auctions here and there, actually the wind sector had a great year, new projects reaching final investment decisions. So really great to see that.

Yeah, definitely, So just looking at the energy transition investment piece, deployment of clean tech, deployment clean infrastructure. It's a really good news story. We saw one point eight trillion dollars invested in twenty twenty three. That one point eight trillion is really the headline number that we that we lead with, So if you're listening, remember that that's the number that matters. That one point eight trillion dollars is up seventeen percent since the year before, since twenty twenty two. It's almost doubled since twenty twenty which is only three years ago. So you know, it gives you an idea of the pace of change in the energy transition. And that one point it trillion is not only a record year in twenty twenty three, but it's the tenth record year in a row. So again that gives you something of an idea of the size and scale and momentum of the opportunities in the energy transition. I can say a bit about the individual sectors because within that one point eight trillion, there are ten different sectors that we track. I'm not going to talk about all of them, but the largest this year is electrified transport, and that's all of your sales of evs including two and three wheelers, cars, buses, trucks, the associated charging infrastructure for all of those as well, and a small amount of hydrogen fuel cell vehicles as well in there. That's now six hundred and thirty four billion, so it's like a third of the total energy transition spending. It jumped thirty six percent last year, which is really great. I mean, shows how fast the EV transition is going, and it overtook renewable energy. For years and years, as long as we've been doing this, renewable energy was the largest sector. Transport is now the largest sector, and I think that was really interesting. But renewable energy also had a good year. Renewbal energy is up eight percent this year. It's now I think six or twenty three billion, to be exact. And one of the kind of underreported stories within the data is that the wind sector actually had a record year of investment in twenty twenty three. Despite everything we saw around project cancelations of us offshoal wind projects, failed auctions here and there, actually the wind sector had a great year, new projects reaching final investment decisions. So really great to see that.

Can I also add a point. I think the headline dollar investment numbers always paint a really positive picture. They've been increasing for so many years, But in all of these different sectors, the costs of all these assets are actually declining at the same time, so investments up every year. But that's actually each individual dollar is deploying more and more assets every year.

Can I also add a point. I think the headline dollar investment numbers always paint a really positive picture. They've been increasing for so many years, But in all of these different sectors, the costs of all these assets are actually declining at the same time, so investments up every year. But that's actually each individual dollar is deploying more and more assets every year.

And actually, you know, one of the other really interesting stories is that we're starting to see some of the smaller sectors start to scale up. So I'm talking about areas like hydrogen and carbon capture, which historically have been pretty small parts of this. This total hydrogen investment tripled last year to ten billion ccs investment nearly doubled, it's now eleven billion dollars, and energy storajet is now thirty six billion dollars grew seventy six percent last year. So if you look at the charts and the report, which I encourage you to do, there's a free version of a bridge version of the report you can find or or for clients, you can find it on the BNF platform. You know, some of these slivers are actually a bit too small to see because the renewables and electric vehicles and power grades are so big, but they're growing really quickly, hydrogen ccas doubling, tripling, and I think that's really encouraging for where we need to get to by twenty thirty in terms of commercializing those technologies.

And actually, you know, one of the other really interesting stories is that we're starting to see some of the smaller sectors start to scale up. So I'm talking about areas like hydrogen and carbon capture, which historically have been pretty small parts of this. This total hydrogen investment tripled last year to ten billion ccs investment nearly doubled, it's now eleven billion dollars, and energy storajet is now thirty six billion dollars grew seventy six percent last year. So if you look at the charts and the report, which I encourage you to do, there's a free version of a bridge version of the report you can find or or for clients, you can find it on the BNF platform. You know, some of these slivers are actually a bit too small to see because the renewables and electric vehicles and power grades are so big, but they're growing really quickly, hydrogen ccas doubling, tripling, and I think that's really encouraging for where we need to get to by twenty thirty in terms of commercializing those technologies.

Now Geographically, one of the markets that's adapting things like electric vehicles and renewable energy at real scale is China, and you really can't understand the energy transition story without really taking a closer look at China. So let's do that right now. First of all, what is the role of China. What is the magnitude of their investment versus the rest of the world.

Now Geographically, one of the markets that's adapting things like electric vehicles and renewable energy at real scale is China, and you really can't understand the energy transition story without really taking a closer look at China. So let's do that right now. First of all, what is the role of China. What is the magnitude of their investment versus the rest of the world.

So China is thirty eight percent of the energy transition investment total this year, so thirty eight percent by far the largest market, and that's because as a region, as a strategy, China has said, we want to be the leaders in renewable energy technology, when we want to be the leaders in electric vehicle technology, and there's been just very consistent support over many years to grow those industries, and so China's streets ahead of everybody else. So just to maybe talk a bit about how the ranking looks in terms of other countries, the US is in second place, and the US invested about three hundred billion dollars versus China's six hundred and seventy six billion dollars in twenty twenty three, So that sounds like a big gap. The US is less than half of China, but that gap has actually closed a little bit over the last year because we're starting to see the effects of the inflation reduction act, and so the US is kind of in catch up mode, which is kind of nice to see. And then the rest of the top ten. If you go down the list, you have Germany, UK, France, and a number of European countries. You've also got Brazil in there, You've got India in there, You've got Japan as well, and the EU. So if you take the European Union as a block of twenty seven, the EU invested three hundred and forty one billion dollars in twenty twenty three, which is a little bit ahead of the US and still quite far behind China. But I think what was really nice to see or interesting to see over the last year was that the EU, the US and UK are really starting to grow now. And between those three blocks they actually accounted for most of the growth that we saw last year. And together Europe, US and UK invested more than China did in twenty twenty three, which they hadn't done in twenty twenty two. So it gives you an idea of where the momentum is globally in the transition as well.

So China is thirty eight percent of the energy transition investment total this year, so thirty eight percent by far the largest market, and that's because as a region, as a strategy, China has said, we want to be the leaders in renewable energy technology, when we want to be the leaders in electric vehicle technology, and there's been just very consistent support over many years to grow those industries, and so China's streets ahead of everybody else. So just to maybe talk a bit about how the ranking looks in terms of other countries, the US is in second place, and the US invested about three hundred billion dollars versus China's six hundred and seventy six billion dollars in twenty twenty three, So that sounds like a big gap. The US is less than half of China, but that gap has actually closed a little bit over the last year because we're starting to see the effects of the inflation reduction act, and so the US is kind of in catch up mode, which is kind of nice to see. And then the rest of the top ten. If you go down the list, you have Germany, UK, France, and a number of European countries. You've also got Brazil in there, You've got India in there, You've got Japan as well, and the EU. So if you take the European Union as a block of twenty seven, the EU invested three hundred and forty one billion dollars in twenty twenty three, which is a little bit ahead of the US and still quite far behind China. But I think what was really nice to see or interesting to see over the last year was that the EU, the US and UK are really starting to grow now. And between those three blocks they actually accounted for most of the growth that we saw last year. And together Europe, US and UK invested more than China did in twenty twenty three, which they hadn't done in twenty twenty two. So it gives you an idea of where the momentum is globally in the transition as well.

Another interesting way to look at the data is these numbers are so big, it's it's one point eight trillion. What does that actually mean in real terms? One way that we think about this to put it in context is what percentage is this spending by market as a share of its total GDP. This actually changes the order of the ranking quite a bit. China is still the largest market as a percentage of GDP by quite a large margin, spends about three point eight percent of its GDP on energy transition. The next best market by this metric is actually the UK a two point two percent, followed by a string of other large European economies which also are around two percent. The US, despite being the second largest market, actually spends only one point one percent of its GDP on the energy transition, and this is well below the global average of one point seven percent. So looking at it from that perspective, just pus these numbers in context. And what other useful said is actually to consider this compared to another large government expenditure defense. NATO recommends that governments spend about two percent of their GDP on defense.

Another interesting way to look at the data is these numbers are so big, it's it's one point eight trillion. What does that actually mean in real terms? One way that we think about this to put it in context is what percentage is this spending by market as a share of its total GDP. This actually changes the order of the ranking quite a bit. China is still the largest market as a percentage of GDP by quite a large margin, spends about three point eight percent of its GDP on energy transition. The next best market by this metric is actually the UK a two point two percent, followed by a string of other large European economies which also are around two percent. The US, despite being the second largest market, actually spends only one point one percent of its GDP on the energy transition, and this is well below the global average of one point seven percent. So looking at it from that perspective, just pus these numbers in context. And what other useful said is actually to consider this compared to another large government expenditure defense. NATO recommends that governments spend about two percent of their GDP on defense.

In the US, the Inflation Reduction Act is just starting to really get steam, right because so much of investment in these assets takes time to actually get off the ground. As the Inflation Reduction Act gets underway. Do you expect that that ratio for the US change or that percentage in the US will change, or is it just such a big economy in terms of GDP that we're already seeing what we expect to see in the yearhead. I'm almost asking you to predict what you think will happen next year now, which is a bit unfair, but you know, what are your views on the Inflation Reduction Act and whether we expect to see a lot of additional growth.

In the US, the Inflation Reduction Act is just starting to really get steam, right because so much of investment in these assets takes time to actually get off the ground. As the Inflation Reduction Act gets underway. Do you expect that that ratio for the US change or that percentage in the US will change, or is it just such a big economy in terms of GDP that we're already seeing what we expect to see in the yearhead. I'm almost asking you to predict what you think will happen next year now, which is a bit unfair, but you know, what are your views on the Inflation Reduction Act and whether we expect to see a lot of additional growth.

Yeah, I would imagine that we will absolutely see growth in the United States. A lot of the subsidies and rules that have been deployed in the Inflation Reduction Act, the actual specific rules about how they'll be applied to projects haven't been determined yet, and so final investment, to say, is waiting to happen. And these projects won't even be built until years after the final investment decision takes place, So we'll be seeing the effect of the Inflation Reduction Act for years in these numbers.

Yeah, I would imagine that we will absolutely see growth in the United States. A lot of the subsidies and rules that have been deployed in the Inflation Reduction Act, the actual specific rules about how they'll be applied to projects haven't been determined yet, and so final investment, to say, is waiting to happen. And these projects won't even be built until years after the final investment decision takes place, So we'll be seeing the effect of the Inflation Reduction Act for years in these numbers.

So one of the things we take a look at at BNF are these energy supply banking ratios, and what we're trying to understand there is actually how much money is being invested in fossil fuels versus cleaner technology, low carbon technology, and really actually trying to set a framework for how much really needs to go into one versus the other in order for us to be paras aligned and looking at emissions. What do the energy investment trends tell us in light of this, How does it align with the work that we've already done on the different ratios that we need to see, which we know need within this current decade needs to be four dollars spent on low carbon technology for every one dollar spent on fossil fuels.

So one of the things we take a look at at BNF are these energy supply banking ratios, and what we're trying to understand there is actually how much money is being invested in fossil fuels versus cleaner technology, low carbon technology, and really actually trying to set a framework for how much really needs to go into one versus the other in order for us to be paras aligned and looking at emissions. What do the energy investment trends tell us in light of this, How does it align with the work that we've already done on the different ratios that we need to see, which we know need within this current decade needs to be four dollars spent on low carbon technology for every one dollar spent on fossil fuels.

Yeah, exactly.

Yeah, exactly.

So, Danny, you're talking about some work we did over the last couple of years looking at paras aligned climate scenarios and what investment is required to achieve those scenarios. And there's a lot of variation, but we find in general that during the course of this decade, we need to be investing four times as much in clean energy supply as in fossil energy supply. So this Energy Transition Investment trans Report shines a light on like where is the money actually flowing? An arely on track for that four to one during this decade? So the answer is, we're not on track, but there are some interesting trends in here. So let me let me kind of unpick it. That one point eight trillion dollars of investment into energy transition. Investment includes both supply side and demand side. On the supply side, there's about a trillion dollars going into things like renewables and nuclear and hydrogen, so it's kind of energy supplying technologies. But the rest of it, about seven hundred and fifty billion dollars, is energy consuming technologies like electric vehicles, electric heat pumps, electric arc furnaces, to make steel, things like that that you wouldn't consider to be on the energy supply side. So first you have to unpack that. Now, if you take the total, the one point eight trillion dollars, that's far above what's currently invested into fossil fuel supply. Fossil fuel supply investment is only about one point one trillion dollars at the moment. That includes exploration and production for oil and gas, coal mining, and also uninmbated fossil fuel power generation. It's one point one trillion, But that one point one trillion fossil is more than the supply piece of the one point eight. So the supply piece of the one point eight is only one point zero trillion. So that's a long, long winded way of saying, if you just take the supply of clean energy and supply of fossil fuel energy, we think fossil fuel energy is slightly ahead. It's still slightly ahead, about seven percent ahead of clean energy supply, and that's obviously not where we need to get to when we're thinking about a four to one ratio.

So, Danny, you're talking about some work we did over the last couple of years looking at paras aligned climate scenarios and what investment is required to achieve those scenarios. And there's a lot of variation, but we find in general that during the course of this decade, we need to be investing four times as much in clean energy supply as in fossil energy supply. So this Energy Transition Investment trans Report shines a light on like where is the money actually flowing? An arely on track for that four to one during this decade? So the answer is, we're not on track, but there are some interesting trends in here. So let me let me kind of unpick it. That one point eight trillion dollars of investment into energy transition. Investment includes both supply side and demand side. On the supply side, there's about a trillion dollars going into things like renewables and nuclear and hydrogen, so it's kind of energy supplying technologies. But the rest of it, about seven hundred and fifty billion dollars, is energy consuming technologies like electric vehicles, electric heat pumps, electric arc furnaces, to make steel, things like that that you wouldn't consider to be on the energy supply side. So first you have to unpack that. Now, if you take the total, the one point eight trillion dollars, that's far above what's currently invested into fossil fuel supply. Fossil fuel supply investment is only about one point one trillion dollars at the moment. That includes exploration and production for oil and gas, coal mining, and also uninmbated fossil fuel power generation. It's one point one trillion, But that one point one trillion fossil is more than the supply piece of the one point eight. So the supply piece of the one point eight is only one point zero trillion. So that's a long, long winded way of saying, if you just take the supply of clean energy and supply of fossil fuel energy, we think fossil fuel energy is slightly ahead. It's still slightly ahead, about seven percent ahead of clean energy supply, and that's obviously not where we need to get to when we're thinking about a four to one ratio.

Since we're now here talking about one point five degrees, what do we need to do? What sort of investment do we need to see in order for it to be aligned to that emission scenario.

Since we're now here talking about one point five degrees, what do we need to do? What sort of investment do we need to see in order for it to be aligned to that emission scenario.

So in the report, we look at our own net zero scenario, which is a parasaligine scenario in which the world achieves net zero by mid century. And in that scenario, the required levels of energy transition investment over the course of the rest of this decade is about four point eight trillion dollars per year. So from twenty twenty four to twenty thirty, an average of four point eight trillion dollars per year, that's almost three times the one point eight trillion dollars we saw invested in reality last year. So we're talking about an overnight rapid acceleration of energy transition investment. But remember we've seen a doubling over the last three years, so we're not standing still. And this time next year, are we going to be at four point eight? No, we're not. But I'm not going to be telling you that it needs to triple. That gap is. I'm sure it's going to get smaller and smaller. So I think whenever I present these numbers, this tripling that's required, people always go, oh my god, that's incredible. But you know, when you sit in this industry long enough, you see doublings happening, you see triplings happening, and it does leave you with a sense of you know, we can climb this mountain. It can be done.

So in the report, we look at our own net zero scenario, which is a parasaligine scenario in which the world achieves net zero by mid century. And in that scenario, the required levels of energy transition investment over the course of the rest of this decade is about four point eight trillion dollars per year. So from twenty twenty four to twenty thirty, an average of four point eight trillion dollars per year, that's almost three times the one point eight trillion dollars we saw invested in reality last year. So we're talking about an overnight rapid acceleration of energy transition investment. But remember we've seen a doubling over the last three years, so we're not standing still. And this time next year, are we going to be at four point eight? No, we're not. But I'm not going to be telling you that it needs to triple. That gap is. I'm sure it's going to get smaller and smaller. So I think whenever I present these numbers, this tripling that's required, people always go, oh my god, that's incredible. But you know, when you sit in this industry long enough, you see doublings happening, you see triplings happening, and it does leave you with a sense of you know, we can climb this mountain. It can be done.

It's also worth noting that while certain markets are further ahead in terms of their energy transition spending, I don't think there's a single one of the G ten markets that are actually on track. The fact that China is spending more money, it actually needs to spend even more than regions in Europe to get on track for net zero. So basically everywhere can be doing more to get on track.

It's also worth noting that while certain markets are further ahead in terms of their energy transition spending, I don't think there's a single one of the G ten markets that are actually on track. The fact that China is spending more money, it actually needs to spend even more than regions in Europe to get on track for net zero. So basically everywhere can be doing more to get on track.

On this show and actually for everybody over the last few years, I think people have been giving a lot of thought to supply chains, how things get where they need to be. How are we going to get all of this clean energy equipment in place in order for us to create these infrastructure investments. So where is the clean energy supply chain investment being invested into or actually is it being invested into enough in order to facilitate the magnitude of change that we're talking about.

On this show and actually for everybody over the last few years, I think people have been giving a lot of thought to supply chains, how things get where they need to be. How are we going to get all of this clean energy equipment in place in order for us to create these infrastructure investments. So where is the clean energy supply chain investment being invested into or actually is it being invested into enough in order to facilitate the magnitude of change that we're talking about.

Thanks Dennis. So that brings us to the second part of the report, which is all around this question of clean energy supply chain investment. Let me just talk a bit about the overall numbers that we're seeing and maybe we can move on to is it enough, which is a really interesting question in its own right. So within the clean energy supply chain investment piece of this report, we're looking at factories across the supply chains of the battery sector, the solar sector, the wind sector, the hydrogen sector, you know, across all those value chains, plus also the mining and refining of key battery metal, so that's lithium, cobalt, and nickel specifically. So that's the scope of what we're looking at. There are some other parts of the energy transition that are are going to be important that we're not quite including just yet, things like copper and steel. But these are the really kind of central core pieces of equipment that we need to scale up for the energy transition. The good news is it scaling up. So from twenty twenty to twenty twenty three we saw an increase in investment from forty six billion dollars to one hundred and thirty five billion dollars, so almost a tripling of investment over the last few years into all of those pieces of factories in mining and refining that are needed. And because we have a slightly different methodology for this piece of the report, we're actually tracking expected factory commissionings and mine mind commissionings, and you can actually see a little bit more into the future for these assets. We can see what's going to happen over the next couple of years. So from one hundred and thirty five billion dollars invested in twenty twenty three, we actually expect that to reach two hundred and fifty billion dollars by twenty twenty five, which is about a two thirds increase again from what we saw last year. So the answer is it's really healthy. We're seeing really good investment into the global clean energy supply chains. And just to kind of illuminate a little bit what the main drivers are. In any given year, about eighty or ninety percent of that investment is going either into battery factories or solar factories. So batteries and solar are the vast, vast majority of that, and that's just the sheer production capacity needed to supply those very rapidly growing industries. Then hydrogen and wind make up a very small sliver, and then there's about ten to twenty percent depending on the year, that goes into the battery metals piece. So that's just kind of how to understand. It's not right or wrong, but that's just what we're seeing in terms of the investment trends.

Thanks Dennis. So that brings us to the second part of the report, which is all around this question of clean energy supply chain investment. Let me just talk a bit about the overall numbers that we're seeing and maybe we can move on to is it enough, which is a really interesting question in its own right. So within the clean energy supply chain investment piece of this report, we're looking at factories across the supply chains of the battery sector, the solar sector, the wind sector, the hydrogen sector, you know, across all those value chains, plus also the mining and refining of key battery metal, so that's lithium, cobalt, and nickel specifically. So that's the scope of what we're looking at. There are some other parts of the energy transition that are are going to be important that we're not quite including just yet, things like copper and steel. But these are the really kind of central core pieces of equipment that we need to scale up for the energy transition. The good news is it scaling up. So from twenty twenty to twenty twenty three we saw an increase in investment from forty six billion dollars to one hundred and thirty five billion dollars, so almost a tripling of investment over the last few years into all of those pieces of factories in mining and refining that are needed. And because we have a slightly different methodology for this piece of the report, we're actually tracking expected factory commissionings and mine mind commissionings, and you can actually see a little bit more into the future for these assets. We can see what's going to happen over the next couple of years. So from one hundred and thirty five billion dollars invested in twenty twenty three, we actually expect that to reach two hundred and fifty billion dollars by twenty twenty five, which is about a two thirds increase again from what we saw last year. So the answer is it's really healthy. We're seeing really good investment into the global clean energy supply chains. And just to kind of illuminate a little bit what the main drivers are. In any given year, about eighty or ninety percent of that investment is going either into battery factories or solar factories. So batteries and solar are the vast, vast majority of that, and that's just the sheer production capacity needed to supply those very rapidly growing industries. Then hydrogen and wind make up a very small sliver, and then there's about ten to twenty percent depending on the year, that goes into the battery metals piece. So that's just kind of how to understand. It's not right or wrong, but that's just what we're seeing in terms of the investment trends.

At the moment.

At the moment.

Historically, we've seen China be a really dominant player with batteries and solar, which you point out, and you're highlighting that there's a lot of money going into supply chain specifically for these two industries. Is that a sign that we are actually seeing a bit of a pivot because one of the things that we have noticed since been brought up on this show a few times, is that supply chains are changing. There is more near shoring and on shoring, and different parts of the world are thinking about not only investing in a clean energy future, but actually thinking about how they're going to manufacture it closer to home and in some cases actually also create jobs through that. Is that having a influence on the amount of money that you're seeing going into the supply chain investment, specifically calling out batteries and solar, but really for all of the industries that we took a look at, Yeah.

Historically, we've seen China be a really dominant player with batteries and solar, which you point out, and you're highlighting that there's a lot of money going into supply chain specifically for these two industries. Is that a sign that we are actually seeing a bit of a pivot because one of the things that we have noticed since been brought up on this show a few times, is that supply chains are changing. There is more near shoring and on shoring, and different parts of the world are thinking about not only investing in a clean energy future, but actually thinking about how they're going to manufacture it closer to home and in some cases actually also create jobs through that. Is that having a influence on the amount of money that you're seeing going into the supply chain investment, specifically calling out batteries and solar, but really for all of the industries that we took a look at, Yeah.

The picture is going to start to change now. So if you just look at the factory investment into clean energy equipment factories over the last few years, more than ninety percent of the new capacity and the new investment has been happening in mainland China. And I don't think that comes as so much of a surprise for those of us in the industry because we know that mainland China is supplying most of the solar modules and battery sales that we're using around the world. But we can see in the data, and again because of the way we do the factory investment, we can see the next couple of years and what you'll see if you take a look in the report is that by twenty twenty five, suddenly a little bit more than a third of the investment is suddenly going to other regions that are on mainland China, especially Europe and the US, and so there in the data you can see very clearly the impact of the Inflation Reduction Act, the Net Zero Industry Act, and so on. Now, I think what's important to keep an eye on here is, yes, it's great that there's investment. That's great that there's supply chain diversification. I think that leads to a more resilient industry. But this is happening at the same time as we're experiencing oversupply in the solar industry and oversupply in the battery industry as well, and that's why both of those technologies have become very very cheap over the last six to nine months, and so we're seeing this potential for overinvestment. Actually, these new factories will come online, they're coming The question is which ones are really going to be successful, which ones are really going to be competitive in an environment where we have an over supply situation, And that's something we're going to be keeping an eye.

The picture is going to start to change now. So if you just look at the factory investment into clean energy equipment factories over the last few years, more than ninety percent of the new capacity and the new investment has been happening in mainland China. And I don't think that comes as so much of a surprise for those of us in the industry because we know that mainland China is supplying most of the solar modules and battery sales that we're using around the world. But we can see in the data, and again because of the way we do the factory investment, we can see the next couple of years and what you'll see if you take a look in the report is that by twenty twenty five, suddenly a little bit more than a third of the investment is suddenly going to other regions that are on mainland China, especially Europe and the US, and so there in the data you can see very clearly the impact of the Inflation Reduction Act, the Net Zero Industry Act, and so on. Now, I think what's important to keep an eye on here is, yes, it's great that there's investment. That's great that there's supply chain diversification. I think that leads to a more resilient industry. But this is happening at the same time as we're experiencing oversupply in the solar industry and oversupply in the battery industry as well, and that's why both of those technologies have become very very cheap over the last six to nine months, and so we're seeing this potential for overinvestment. Actually, these new factories will come online, they're coming The question is which ones are really going to be successful, which ones are really going to be competitive in an environment where we have an over supply situation, And that's something we're going to be keeping an eye.

On It's also interesting because the newest factories tend to be the ones that can produce at the lowest cost, so there's no real market incentive for you not to build the newest factory. It's more of an industry problem.

On It's also interesting because the newest factories tend to be the ones that can produce at the lowest cost, so there's no real market incentive for you not to build the newest factory. It's more of an industry problem.

Is this investment volume then in supply chains going to well, first of all, accelerate the amount of projects we're actually going to end up seeing, and is it net zero aligned? Are we going to see the emissions reductions associated with it? Is it enough?

Is this investment volume then in supply chains going to well, first of all, accelerate the amount of projects we're actually going to end up seeing, and is it net zero aligned? Are we going to see the emissions reductions associated with it? Is it enough?

Yeah?

Yeah?

Great question. So we do the same analysis for the Cleange supply chain investment where we compare it to what's needed to get on track for net zero in aggregate. If you take the one hundred and thirty five billion dollars, it's enough, Like if we maintain that level of spending for the next few years, we'll have enough factories and minds to supply the equipment needed for net zero, which is a great I mean, that's a really nice story. We're not talking about needing to triple it as we are with the energy transition investment, so that's fantastic. But if you dig a little bit deeper, it's actually more nuanced than that. So if you just take solar for example, we actually don't need any more solar factories at all. That we could invest zero for the next few years in solar manufacturing and we'd be okay for that zero. That's the extent of the capacity that we've already.

Great question. So we do the same analysis for the Cleange supply chain investment where we compare it to what's needed to get on track for net zero in aggregate. If you take the one hundred and thirty five billion dollars, it's enough, Like if we maintain that level of spending for the next few years, we'll have enough factories and minds to supply the equipment needed for net zero, which is a great I mean, that's a really nice story. We're not talking about needing to triple it as we are with the energy transition investment, so that's fantastic. But if you dig a little bit deeper, it's actually more nuanced than that. So if you just take solar for example, we actually don't need any more solar factories at all. That we could invest zero for the next few years in solar manufacturing and we'd be okay for that zero. That's the extent of the capacity that we've already.

Built globally, including chain.

Built globally, including chain.

Yeah, globally, But to Mark's earlier point, that's not what's going to happen because these industries they want to build the latest factory with the best equipment to produce the next module that has greater efficiency and lower cost per water and so on. So actually you are going to see more investment and it's going to drive older factories out of the story. If you look at other sectors like wind for example, So wind is kind of the opposite story. We need to see more investment into wind supply chain, and that need is actually quite stark, so we need to see real rapid increases there. On hydrogen, it again it's slightly a different story that looks like there's enough for a couple of years, but then it needs to ramp up from kind of twenty twenty six onwards. And then finally on battery metals, there's been this really interesting kind of ce sort effect because a few years ago everybody was worried about undersupply and battery metal prices went through the roof. The industry reacted. Now there's a load of new investment that's come into battery metal supply, there's prices coming down again, and so we actually look like we've got enough for the next couple of years. But then likely in three or four or five years time, that's going to turn around again and we're going to need more investment again. So the picture is a little bit more nuanced than that. But when I look at the aggregate data, it does seem like these industries are responsive to market signals. When there's demand, the supply comes through, and so I don't feel that worried about this kind of supply side picture.

Yeah, globally, But to Mark's earlier point, that's not what's going to happen because these industries they want to build the latest factory with the best equipment to produce the next module that has greater efficiency and lower cost per water and so on. So actually you are going to see more investment and it's going to drive older factories out of the story. If you look at other sectors like wind for example, So wind is kind of the opposite story. We need to see more investment into wind supply chain, and that need is actually quite stark, so we need to see real rapid increases there. On hydrogen, it again it's slightly a different story that looks like there's enough for a couple of years, but then it needs to ramp up from kind of twenty twenty six onwards. And then finally on battery metals, there's been this really interesting kind of ce sort effect because a few years ago everybody was worried about undersupply and battery metal prices went through the roof. The industry reacted. Now there's a load of new investment that's come into battery metal supply, there's prices coming down again, and so we actually look like we've got enough for the next couple of years. But then likely in three or four or five years time, that's going to turn around again and we're going to need more investment again. So the picture is a little bit more nuanced than that. But when I look at the aggregate data, it does seem like these industries are responsive to market signals. When there's demand, the supply comes through, and so I don't feel that worried about this kind of supply side picture.

So, Mark, one of the things you spent a lot of time thinking about and brought to this report was your focus on climate tech equity fundraising. In twenty twenty two, we saw declines in climate tech equity financing, and what I I want to better understand is whether or not this improved and rebounded in twenty twenty three.

So, Mark, one of the things you spent a lot of time thinking about and brought to this report was your focus on climate tech equity fundraising. In twenty twenty two, we saw declines in climate tech equity financing, and what I I want to better understand is whether or not this improved and rebounded in twenty twenty three.

Yeah, So this portion of the report is designed to see which companies in the world are actually raising financing in order to drive the energy transition. So it's more about who's raising money and what type of money they're raising, rather than what the money itself is being spent on. And it's kind of a funny story to write when you look at the first half of this report, where investment just keeps going up and up and up, and for two years in a row now we've actually said that equity financing of climate tech companies is going down. So last year we saw a twenty four percent drop to one hundred and twenty seven billion dollars, and this year we saw an even bigger thirty four percent drop to about eighty four billion dollars. So how do you square this story with what Albertsman speaking about for the first half of this podcast. Well, the reality is is that while investment keeps going up and these industries are pretty resilient because their cost competitive, the public market valuations of clean energy companies has seen a real hit this year. So the clean energy industries, they're very focused on the future. There's a lot of growth, and when interest rates go up, this means that a lot of their future revenues and future profits are being discounted at much higher rates, so you'll see that compared to the Standard and Poores Index or the NASDAK Clean Energy indexes could be down fifty or sixty percent compared to being flat over the last two years. So, yes, the industries are strong, but that doesn't necessarily translate to valuations in public markets. And when valuations in public markets decline, companies are less willing to go through IPOs, and that was really the main driver of the big drop in funding this year. It was funding raised through IPOs and reverse mergers. There's a whole other story about why people have stopped doing reverse mergers, but the bottom line is that there's less money being put into companies.

Yeah, So this portion of the report is designed to see which companies in the world are actually raising financing in order to drive the energy transition. So it's more about who's raising money and what type of money they're raising, rather than what the money itself is being spent on. And it's kind of a funny story to write when you look at the first half of this report, where investment just keeps going up and up and up, and for two years in a row now we've actually said that equity financing of climate tech companies is going down. So last year we saw a twenty four percent drop to one hundred and twenty seven billion dollars, and this year we saw an even bigger thirty four percent drop to about eighty four billion dollars. So how do you square this story with what Albertsman speaking about for the first half of this podcast. Well, the reality is is that while investment keeps going up and these industries are pretty resilient because their cost competitive, the public market valuations of clean energy companies has seen a real hit this year. So the clean energy industries, they're very focused on the future. There's a lot of growth, and when interest rates go up, this means that a lot of their future revenues and future profits are being discounted at much higher rates, so you'll see that compared to the Standard and Poores Index or the NASDAK Clean Energy indexes could be down fifty or sixty percent compared to being flat over the last two years. So, yes, the industries are strong, but that doesn't necessarily translate to valuations in public markets. And when valuations in public markets decline, companies are less willing to go through IPOs, and that was really the main driver of the big drop in funding this year. It was funding raised through IPOs and reverse mergers. There's a whole other story about why people have stopped doing reverse mergers, but the bottom line is that there's less money being put into companies.

There's a bit of an irony sometimes in the clean energy industry where at the times when the transition is really accelerating and going quickly, it's often because the technology costs are coming down really really quickly, and often that's because the competitive environment is really aggressive. Certainly at points in history where you've seen both the energy transition starting so quickly because the costs are coming down, but companies hurting because they're competing each other and killing each other on cost and that hurts the equity evaluations. I think that's probably partly what we saw last year as well.

There's a bit of an irony sometimes in the clean energy industry where at the times when the transition is really accelerating and going quickly, it's often because the technology costs are coming down really really quickly, and often that's because the competitive environment is really aggressive. Certainly at points in history where you've seen both the energy transition starting so quickly because the costs are coming down, but companies hurting because they're competing each other and killing each other on cost and that hurts the equity evaluations. I think that's probably partly what we saw last year as well.

Coming back to China, it has a big influence on public financing in this space, what happened in twenty twenty three when it came to IPOs in China.

Coming back to China, it has a big influence on public financing in this space, what happened in twenty twenty three when it came to IPOs in China.

So yeah, we track funding by market obviously, and Mainland China, like the rest of the report, is actually the biggest market. Its lead is a little bit less so than compared with other parts of the report. It raised about twenty five billion dollars this year compared to twenty one for the US, the second largest market. The China market's pretty unique in that it's the only one where the majority of funding comes from public markets rather than venture capital and private equity investors. And the real interesting story this year was that its lead actually shrunk. What's happening with funding in mainland China is that almost all of it is really really big rounds and think like three hundred million dollars plus raised by manufacturers. So we spent that whole five ten minutes talking about manufacturing and the story about over opacity, particularly in China. This has really affected the equity fundraising and we're actually hearing that there's going to be a push to stop companies raising as much money to build new solar and battery capacity to deal with this industry issue of oversupply.

So yeah, we track funding by market obviously, and Mainland China, like the rest of the report, is actually the biggest market. Its lead is a little bit less so than compared with other parts of the report. It raised about twenty five billion dollars this year compared to twenty one for the US, the second largest market. The China market's pretty unique in that it's the only one where the majority of funding comes from public markets rather than venture capital and private equity investors. And the real interesting story this year was that its lead actually shrunk. What's happening with funding in mainland China is that almost all of it is really really big rounds and think like three hundred million dollars plus raised by manufacturers. So we spent that whole five ten minutes talking about manufacturing and the story about over opacity, particularly in China. This has really affected the equity fundraising and we're actually hearing that there's going to be a push to stop companies raising as much money to build new solar and battery capacity to deal with this industry issue of oversupply.

The Double Eyes feature on the show pretty regularly inflation and interest rates. How much of an impact do you think that actually had on the markets and how did clean tech perform in light of that?

The Double Eyes feature on the show pretty regularly inflation and interest rates. How much of an impact do you think that actually had on the markets and how did clean tech perform in light of that?

Yeah, so last year we actually we said that climate tech was a more resilient category in terms of deals happening than the broader market. So we compared all the IPOs and secretary equity offerings happening in the entire economy to what happened in climate and it was more resilient. This year, it was the opposite story. So over the course of last year is basically the climate tech industry has been brought into line with where the rest of the economy is.

Yeah, so last year we actually we said that climate tech was a more resilient category in terms of deals happening than the broader market. So we compared all the IPOs and secretary equity offerings happening in the entire economy to what happened in climate and it was more resilient. This year, it was the opposite story. So over the course of last year is basically the climate tech industry has been brought into line with where the rest of the economy is.

So the newcomer to this report is debt, and we know that debt is an incredibly important part of all of the projects that we look at and clean energy financing. Tell us a little bit about the highlights that we found when we ventured into adding debt to this report for the first time in fifteen years.

So the newcomer to this report is debt, and we know that debt is an incredibly important part of all of the projects that we look at and clean energy financing. Tell us a little bit about the highlights that we found when we ventured into adding debt to this report for the first time in fifteen years.

Yeah, So the absolute value of money that's being raised through debt is unsurprisingly a lot more than it's being raised through equity. So we tracked about eight hundred and twenty four billion dollars this year in debt issuance for the energy transition, and the corporate debt market globally is seventeen point one trillion, so that's a pretty big share of it actually, to be honest, when we think about trends, is going up as it down, and obviously the equity market was down quite a lot this year. The debt market didn't have the same trouble, and it actually increased four percent, and this didn't seem to be a story that was particularly related to the energy transition. It's basically exactly in line with where the entire corporate debt market went. There is also one takeaway you could take from this, which is that the equity funding has fallen by quite a lot, actually a greater dollar value amount than the debt. Corporate debt issuance went up. But also what could be happening here is that the clean energy manufacturing sectors are actually just becoming much more mature, and equity financing is not your first option. You'd rather finance something through debt, it's much cheaper. So what could be happening here a little bit is that these companies are just maturing, they're becoming more bankable, and they're choosing to finance new projects or facilities and through debt issues rather than new equity raises.

Yeah, So the absolute value of money that's being raised through debt is unsurprisingly a lot more than it's being raised through equity. So we tracked about eight hundred and twenty four billion dollars this year in debt issuance for the energy transition, and the corporate debt market globally is seventeen point one trillion, so that's a pretty big share of it actually, to be honest, when we think about trends, is going up as it down, and obviously the equity market was down quite a lot this year. The debt market didn't have the same trouble, and it actually increased four percent, and this didn't seem to be a story that was particularly related to the energy transition. It's basically exactly in line with where the entire corporate debt market went. There is also one takeaway you could take from this, which is that the equity funding has fallen by quite a lot, actually a greater dollar value amount than the debt. Corporate debt issuance went up. But also what could be happening here is that the clean energy manufacturing sectors are actually just becoming much more mature, and equity financing is not your first option. You'd rather finance something through debt, it's much cheaper. So what could be happening here a little bit is that these companies are just maturing, they're becoming more bankable, and they're choosing to finance new projects or facilities and through debt issues rather than new equity raises.

So even though we've been doing this report for fifteen years, we still learn new things every single year, and different things surprise us in different themes emerge. What was the most surprising thought you had when going through the research this year.

So even though we've been doing this report for fifteen years, we still learn new things every single year, and different things surprise us in different themes emerge. What was the most surprising thought you had when going through the research this year.

I think a year ago, my perception of this whole on shoring trend was that we have this knowledge that we know that the equipment that's produced in China is cheaper. A lot of that is due to expertise, energy costs, labor costs, but also there's been a bit of a cloud around how much the government has already been supporting the clean tech manufacturing industries, and so there was a lot of commentary when the US announced subsidies for manufacturing that, oh, it's just always going to be inherently more expensive. But the reality is that we actually don't know to what extent the subsidies have been driving the cost reductions. In China. So I think this is going to be really interesting going forward to see how cost competitive European and US manufacturers can get.

I think a year ago, my perception of this whole on shoring trend was that we have this knowledge that we know that the equipment that's produced in China is cheaper. A lot of that is due to expertise, energy costs, labor costs, but also there's been a bit of a cloud around how much the government has already been supporting the clean tech manufacturing industries, and so there was a lot of commentary when the US announced subsidies for manufacturing that, oh, it's just always going to be inherently more expensive. But the reality is that we actually don't know to what extent the subsidies have been driving the cost reductions. In China. So I think this is going to be really interesting going forward to see how cost competitive European and US manufacturers can get.

Is there something that stood out to you, Albert?

Is there something that stood out to you, Albert?

I would go back to the story in the wind sector, which I mentioned earlier, because you know, we even got caught up in some of the moods of depression last year around the summer when projects were getting canceled and we sat around going, hey, you know, even as BNF, what can we do? Can we write some research to highlight the problems and solutions to this challenge. So at the end of the year, when we ran the numbers, we found that wind had a record year of investment. You know, it was sort of hidden in the numbers, and I just thought, Wow, things are not as bad as they seem, and there's optimism to be had out there. So that was a really positive surprise.

I would go back to the story in the wind sector, which I mentioned earlier, because you know, we even got caught up in some of the moods of depression last year around the summer when projects were getting canceled and we sat around going, hey, you know, even as BNF, what can we do? Can we write some research to highlight the problems and solutions to this challenge. So at the end of the year, when we ran the numbers, we found that wind had a record year of investment. You know, it was sort of hidden in the numbers, and I just thought, Wow, things are not as bad as they seem, and there's optimism to be had out there. So that was a really positive surprise.

One of the things that we do at the beginning of the year is we create these things to watch reports, and we did a series of highlighting a few of them on this show, and it was in the year ahead, what did we think was going to happen? From your standpoint, we know you're going to do this report again next year. Do you have any views on what might come out of that version When we're sitting here in a year's time.

One of the things that we do at the beginning of the year is we create these things to watch reports, and we did a series of highlighting a few of them on this show, and it was in the year ahead, what did we think was going to happen? From your standpoint, we know you're going to do this report again next year. Do you have any views on what might come out of that version When we're sitting here in a year's time.

From the equity funding numbers, it wouldn't surprise me if they're lower again. People seem to be in agreement that interest rates aren't going to go any higher, but it's also not clear that they're going to be cut anytime soon, and so that's going to continue to impact it. And then this issue with manufacturing over capacity means that it's it's going to be a tough business to be in for the next few years, so I think that'll also impact the funding numbers.

From the equity funding numbers, it wouldn't surprise me if they're lower again. People seem to be in agreement that interest rates aren't going to go any higher, but it's also not clear that they're going to be cut anytime soon, and so that's going to continue to impact it. And then this issue with manufacturing over capacity means that it's it's going to be a tough business to be in for the next few years, so I think that'll also impact the funding numbers.

On the energy transition investment numbers. So before we started this year's report, about ten or twelve of us got around and tried to guess what the final number would be. So before we even turned us a single wheel on the numbers, and I guessed one point seventy five trillion, and Philamina, who is our lead analyst on the investment data, guess one point eight trillion. So between the two of us was it ended up being one point seven to seven. So we pretty much nailed it even just before we even ran any numbers. So you know, I'm going to go out on a limb now and say that next year it's going to be more than two trillion, call it two point one trillion. Let's go at two point one and see where we get to.

On the energy transition investment numbers. So before we started this year's report, about ten or twelve of us got around and tried to guess what the final number would be. So before we even turned us a single wheel on the numbers, and I guessed one point seventy five trillion, and Philamina, who is our lead analyst on the investment data, guess one point eight trillion. So between the two of us was it ended up being one point seven to seven. So we pretty much nailed it even just before we even ran any numbers. So you know, I'm going to go out on a limb now and say that next year it's going to be more than two trillion, call it two point one trillion. Let's go at two point one and see where we get to.

I think we need to get Filomina in the room though, to really get to inaccurate now.

I think we need to get Filomina in the room though, to really get to inaccurate now.

Yeah, yeah, exactly. She's the oracle.

Yeah, yeah, exactly. She's the oracle.

Alibert Mark, thank you very much for coming on the show today, and we look forward to talking about this again next year.

Alibert Mark, thank you very much for coming on the show today, and we look forward to talking about this again next year.

Thank you very much, Thank you.

Thank you very much, Thank you.

Switched On is produced by Cam Gray with production assistance from Kamala Shelling and Lushi Kurunorte. Bloomberg NIF is a service provided by Bloomberg Finance LP and its affiliates. This recording does not constitute, nor should it be construed, as investment advice, investment recommendations, or a recommendation as to an investment or other strategy. Bloomberg NIF should not be considered as information sufficient upon which to base an investment decision. Neither Bloomberg Finance LP nor any of its affiliates makes any representation or warranty as to the accuracy or completeness of the information contained in this recording, and any liability as a result of this recording is expressly disclaimed

Switched On is produced by Cam Gray with production assistance from Kamala Shelling and Lushi Kurunorte. Bloomberg NIF is a service provided by Bloomberg Finance LP and its affiliates. This recording does not constitute, nor should it be construed, as investment advice, investment recommendations, or a recommendation as to an investment or other strategy. Bloomberg NIF should not be considered as information sufficient upon which to base an investment decision. Neither Bloomberg Finance LP nor any of its affiliates makes any representation or warranty as to the accuracy or completeness of the information contained in this recording, and any liability as a result of this recording is expressly disclaimed