The advancement of renewable energy in the energy sector is an irreversible movement. According to the Energy Transition Trends 2024 report by BloombergNEF, Brazil invested 30 billion dollars in energy transition in 2023, making it the fifth most attractive country for renewable energy investments.
This reflects the significant growth of the industry and the increasing commitment of companies to reduce their ecological footprint.
The main sources of renewable energy in Brazil include hydroelectric, solar, wind, and biomass. Sanitation companies are also prioritizing environmental sustainability in their investments.
If you are interested in investing in this promising sector, here are three options to get you started:
Investing in stocks of clean energy companies is an excellent way to participate in the growth of the renewable energy sector.
To do this, analyzing whether the company is a good investment option is the first step. Consider the company’s history, financial performance over the years, growth, and market credibility.
An investor may choose to buy stocks directly, acquire debt securities, or invest in infrastructure funds that favor renewable energy.
To ensure that the selection parameters are appropriate, it is important to consider credibility indices such as the Corporate Sustainability Index (ISE B3), the Carbon Efficient Index (ICO2 B3), and the Corporate Governance Index (IGC).
They help identify companies committed to sustainable and good governance practices, providing greater security and return potential for investors.
Another option is to invest in investment funds focused on the renewable energy sector. They offer benefits such as the need for less time monitoring market movements and lower risks, while still providing a good return.
Among the most well-known types of funds are multi-market funds and real estate funds. In recent years, the cost of renewable energy technology has decreased significantly, making these options even more attractive and popular.
The Itaú ESG Clean Energy Equity Fund is one of the most well-known in Brazil and favors stocks of companies operating in the clean energy sector and promoting sustainable and responsible practices.
Investing in sector-specific renewable funds allows investors to diversify their portfolios and capitalize on the sector’s growth without facing the complexities of higher-risk investments.
Another approach is to invest in companies from various sectors that are leaders in ESG (Environmental, Social, and Governance) practices. These companies adopt policies that promote sustainability and social responsibility, consistently applying these practices in their areas of operation.
Investing in companies with strong ESG policies not only contributes to a more sustainable future but can also offer solid financial returns, as these companies tend to be more resilient and innovative, relying on assertive planning to guide their ventures.
Check out our article on implementing ESG practices in investment funds to choose the most advantageous options.
In addition to focusing directly on companies that produce renewable energy, consider investing in strategic sectors such as technology, health and wellness, and sustainable infrastructure.
The renewable energy sector is growing, and Brazil stands out as one of the global leaders in this expanding market. This market is less susceptible to macroeconomic cycles, making this type of investment more stable in the long term.
This is the time to get acquainted with green energy, which not only helps reduce pollution caused by fossil fuels but also offers various tax incentives and credit options.
However, it is essential that investment decisions are aligned with each investor’s profile.
Rely on Upside to identify the best opportunities and ensure that your investments are aligned with your financial goals.