Research and publications
The Pricing of Green Infrastructure: The realised and expected financial performance of green power infrastructure investment, 2010-2021
In this paper, we examine the impact on realised performance of this permanent shift in investor preferences for low carbon energy investments, and how it relates to t ...
Author(s):
Noël Amenc, Frédéric Blanc-Brude
Summary:
In this paper, we examine the impact on realised performance of this permanent shift in investor preferences for low carbon energy investments, and how it relates to the expected returns of green power investments. We show that while green infrastructure has outperformed the ‘Core’ infrastructure market over the past decade, this is largely the result of excess demand for such assets that has pushed asset prices up and discount rates down. We find that controlling for a number of risk factors that are present in the returns of unlisted infrastructure equity investment, there is no persistent ‘green’ risk factor, but instead a ‘green price premium’ that investors have been willing to pay to increase their holdings of such assets.
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| Date : | 22/11/2022 |
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