Learn more about our Clean Energy ETF
Part 1: Introduction to the Clean Energy ETF | ZERO
Part 2: Investors Guide to Clean Energy | Sources of Clean Energy
Part 3: Investment Case for Clean Energy
Part 4: Introducing the HANetf S&P Global Clean Energy Select HANzero™ UCITS ETF
Introduction
There is little doubt that the global fight against climate change will be the greatest challenge to face humanity in the coming century. While it will be a difficult fight to win, it will also create opportunity, in particular for those businesses that lead on innovation in clean energy.
With strengthening tailwinds coming from both economics and policy, we believe the long-term investment case for businesses principally engaged in clean energy technologies is incredibly strong.
From a policy perspective, the change in US administration following the election of President Biden has re-galvanized global consensus and leadership in pursuing incredibly ambitious greenhouse gas reductions over the coming decades. The Paris Agreement is at the centre of this movement, committing signatory nation-states to reducing emissions with the goal of limiting global warming to less than 2 degrees Celsius versus pre-industrial levels. Meeting these goals will require wholesale change across virtually all industries, calling on innovation to define the businesses that will lead and thrive.
Clean energy is the key enabler, encompassing wind, solar, hydroelectric, geothermal and biomass. In particular with respect to solar and wind, decades of government support programs have enabled sufficient innovation such that these technologies are now cost-competitive with traditional fossil fuels. The result has been a material increase in private sector capital flows into related projects. Traditional energy companies are engaged, but with participation largely limited to abatement technologies directly related to their core fossil fuel businesses. This leaves the playing field largely open to pure-play clean energy businesses.
We have seen these shifting fundamentals reflected in recent outperformance among these businesses relative to traditional energy counterparts.
The Investment Opportunity
Our Clean Energy ETF provides concentrated exposure to the Clean Energy sector, tracking the S&P Clean Energy Select Index. ZERO goes beyond financing businesses engaged in clean energy. Through its partnership with South Pole, a market-leader in sustainability consulting and carbon credits, HANetf will invest in carbon offset projects to offset the carbon footprint of the portfolio as defined by Trucost. Even clean energy has a carbon footprint, and this partnership will enable the fund and its investors to take immediate action to offset these emissions.
This will enable environmentally conscious investors to achieve exposure to a critical sector that provides potential capital gains while ensuring a net zero carbon emission portfolio.
The Clean Energy ETF is managed by Purpose Investments, a Canadian investment manager with over $11 billion in assets under management. Purpose has broad capabilities across fundamental and quantitative investment strategies, including the incorporation of ESG as a core pillar of its investment processes throughout its product lineup.