Portfolio Manager Marcus Björkstén’s thoughts on the EU Green Deal's implications on Fondita Sustainable Europe

Sustainable Europe


EU wants 25 times more offshore wind turbines compared to today before 2050

The focus of Fondita Sustainable Europe is to invest in companies that are well positioned with regards to global ambitions towards Co2-reduction and the more efficient use of natural resources. One of the key drivers of the fund is the fact that these issues have a high priority on the political agenda and there is political/regulatory tailwind to drive investments that are aligned with environmental goals. One massive undertaking is the “Green Deal”, announced in December last year. The European Green Deal is a set of policy initiatives by the European commission with the overarching aim of making Europe climate neutral in 2050. In addition, the initiatives are also targeted towards investments including clean energy, circular economy, energy efficiency in buildings, and biodiversity. The total size of this massive program is forecasted to be around 1 trillion euros.

Earlier this week EU Vice-President Frans Timmermans announced that the EU intends to invest 800 billion euros in offshore wind, tidal and floating solar energy over the next coming decades. This should lead to a fivefold increase in offshore wind energy capacity before 2030. In 2050 there should be 25 times as many wind turbines in European waters as there are today. This is stated in the EU strategy for renewable energy at sea.

The fund is invested in companies that should benefit from this specific initiative. Among the fund’s largest holdings are wind turbine manufacturers Vestas Wind and Siemens Gamesa. The fund is also invested in sub-suppliers towards offshore wind such as the underwater cable producer Prysmian and offshore foundation producer SIF Group. Other holdings exposed to wind-power in general are wind-park operators Eolus Wind and Örsted.

Another specific initiative is within building and housing. The ambition is to triple the renovation rate within the EU during the coming decades in order to make buildings more energy efficient and thus more sustainable. Holdings in Fondita Sustainable Europe well aligned with this specific ambition are isolation panels manufacturers Kingspan and Recticel. The fund is also invested in Polypipe which produces plastic pipes (made from recycled plastic) used in residential and commercial buildings.

These types of concrete investment programmes within the EU Green Deal contribute to the structural growth feature that we look for in the fund´s holdings. As time goes by these initiatives are set into motion and the ambition level is quite clear.

Text written by portfolio manager

Marcus Björkstén


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