In the Western world, we’re relentless in our focus of making green technology and green industry the focal point of society, driving the need for renewable at every possible turn. Despite the fact that many of us in the Western world believe that we are at the forefront of this pioneering technology, this is far from the case and, if we look towards the East, we will see that places such as Dubai are currently far ahead of where we stand.
Public-Private Partnerships Look to Engage
Of all green technology focus areas, green finance is one which is generally considered to be relatively niche and abstract. This means that, over the course of the past few years at least, it has been unattractive for the majority of investors who have failed to see the lure. However, it appears as though times are about to change due to the fact that public-private partnerships are imminent; thus making the project much more attractive for investors.
Dubai Takes the Lead
Dubai are taking the lead on such an initiative, aiming to reduce energy consumption by 30% by 2020, with renewable projects expected to play a key part in achieving such an ambitious target. Although at present several high profile analysts claim that the climate has not been inviting for any potential investors, it appears as though all of this is about to change, with many companies looking to overcome the challenges that have previously plagued the green market.
As has always been the case, cost competitiveness of green energy remains an issue and, because of this, green energy cannot compete with conventional energy sources on price alone. Due to this, the green energy revolution, in order to appeal to investors, must have support from all sectors of society; including the government.
A Long Term Plan To Allay Investor Fears
Such a process, however, is already underway, and the long term plan still appears to be to get investors to be more comfortable with green energy proposals, understanding exactly what it entails. To do this, it appears as though better education, better promotion and certain guarantees from a governmental level are all but essential.
Anyone who indulges in online trading (or any variant of it) is often especially wary of investing in projects with green energy because such projects are often not economically viable. Due to this, many individual traders will not invest, wary of the fact that these projects require financial support from a government channel, and are subject to large price fluctuations as a result.
How to Overcome Fears
Wary that this is a long term project, certain groups are looking to kick-start the project by offering financial incentives to investors that could be used to fund green projects. Looking at the lending community specifically, Dubai appears to be targeting meeting green energy targets by building a 100MW photovoltaic solar power plant, and consultants were appointed for this project last month. Overall, over the next few years, AED50bn ($13.6bn) has been allocated for green projects.