The shift in investment is attributed to the relative attractiveness of other sectors, such as artificial intelligence, and high-profile disappointments in the clean energy industry. The wind power sector, in particular, has suffered from poor national offshore auction results and corporate issues. Despite these setbacks, it remains unclear whether this trend will continue, as the broader push for cleaner energy sources retains wide societal, political, and corporate support.
Key takeaways:
- Investors have withdrawn record funds from the world's largest clean energy investment vehicles this year, with a net $765 million withdrawn from the iShares Global Clean Energy ETF (ICLN) through August, the largest net outflow on record for that fund during any January-August period.
- A key reason for the withdrawals from clean energy investment funds has been the relative attractiveness of other sectors, such as artificial intelligence. The Global X Robotics & Artificial Intelligence ETF (BOTZ) saw net inflows of over $614 million through August.
- High profile corporate and national disappointments in critical areas of the clean energy industry have also contributed to the outflows. This includes the wind power sector, which has suffered from disappointing national offshore auction results in Britain and the U.S., and issues in the solar industry.
- Despite these setbacks, it is unclear whether they will turn into sustained reversals, as the broader push for cleaner energy sources retains wide support. For long-term investors, even modest success stories could be enough to flip the recent fund flow trends from outbound to inbound.