The team that manages Norwich Union’s socially responsible investment funds believes high gas and oil prices will help drive returns in the renewable energy sector.
The team that manages Norwich Union’s socially responsible investment (SRI) funds believes high gas and oil prices will help drive returns in the renewable energy sector.
High energy prices, concerns about security of supplies and the introduction of the EU Emissions Trading System* (ETS) make renewable energy companies look more attractive. The cost of electricity generated by wind power is now comparable to electricity generated from gas, and the recent increase in gas prices further enforces the economic viability of wind.**
Clare Brook, director of socially responsible investment for Norwich Union, said: “Cheap fossil fuels are becoming a thing of the past, but this puts the focus on renewable energy and energy efficiency sectors. As these sectors thrive, they create great investment opportunities. We have been investing in alternative energy companies, companies that promote energy efficiency and house builders that specialise in energy-efficient homes. Several power companies such as Scottish Power and Scottish and Southern are diversifying into alternative energy.”
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Press office contacts:
David Gwyer 01904 452828 Out of hours 07800 699508
James Evans 01904 452791 Out of hours 07800 699525
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Cheryl Cox 01904 452617 Out of hours 07800 695275
* About the EU Emissions trading System
The EU Emissions trading System started in January has placed a cap on the amount of CO2 that companies (including power generators) can emit. If companies can not meet their reduction targets, they are forced to buy CO2 credits from other companies. The result has been to attach a cost to emitting CO2, which is passed on to electricity users. Carbon is currently trading at about 20Euro a tonne.
** Electricity from wind power costs about EUR cents 4-12 /kW hour, UK gas stock electricity prices historically cost circa EUR cents 3-6 /kW hour; the recent rally has gas stock electricity up to circa EUR cents 7-8 /kWh.
About Norwich Union’s socially responsible investment team
Norwich Union has seven socially responsible investment funds. Its socially responsible team is based at Morley Fund Management and is one of the largest and most experienced in the UK. The team is lead by Peter Michaelis.
Notes to editors:
Norwich Union is one of the UK's biggest life insurers. It is a leading provider of life, pensions and investment products and one of the largest Financial Adviser (FA) providers. FAs provide over 70% of the company's long-term savings business in the UK.
Norwich Union has strategic alliances with building societies and other leading UK brand names including CIS and The Royal Bank of Scotland Group. Norwich Union’s news releases and a selection of images are available from Aviva's internet press centre at www.aviva.com/media.