Using today’s fossil-fuel profits to invest in the long-term growth and emissions reduction of clean and renewable power.

Many of today’s energy investors face a pressing conundrum. Tackling climate change makes investing in clean and renewable energy businesses an attractive long-term growth opportunity; and some investors have also made specific pledges to reduce their clients’ portfolio emissions, over time, to net zero. Over the shorter term, however, most of the energy sector’s profit and return is likely to come from carbon-intensive businesses.

We believe there is a way to resolve that conundrum. A new energy investment paradigm is emerging that aims not only to find the right balance between these two time horizons, but also to use some of the energy industry’s $4tn of annual net income to help unlock the net-zero economy of the future.

How a Hypothetical Energy Transition Accelerator Portfolio Evolves

Reallocation based on ongoing net-zero alignment assessments…

Values of benchmark rating

… should eliminate Sleeve III companies and grow the Sleeve IV allocation over time.

 ESG scores 

Source: Neuberger Berman. For illustrative purposes only, as of September 2023.