Equities

Powering the future: Building resilient energy grids

August 27, 2025 - 5 min

Hello everyone, I am Marine Michiels, and I am on the Sustainable Equities Team at Mirova.

Did you know that electricity's share of global energy consumption is projected to exceed 50% by 2050. This is a significant increase from the past two decades. This growth is driven by the rise of renewable energy, the electrification of transportation, and increasing demand from digital connectivity and also air conditioning. As our world becomes increasingly electrified, the need for a robust and resilient power network has never been more urgent.

In fact, while we see a boom in electricity generation with renewables leading the charge, there is a growing concern – investment in our power grids is lagging behind and they are already quite old. Indeed, Bloomberg NEF reported $274 billion in global electricity grid investments in 2022, yet estimates suggest we will need a staggering $21 trillion to reach net-zero emissions by 2050. This is 70% of all new power generation investment.

This imbalance poses significant challenges, from lengthy connection queues to worse, blackouts, which means we need to expand and upgrade our grids to ensure reliability. Additionally, regulation will be crucial to promote infrastructure investment while maintaining affordability for consumers.

The anticipated rise in capital expenditure is expected to translate into substantial earnings growth, across the entire power network value chain including electricity production, transmission, but also distribution.

As we stand on the brink of an energy revolution, the path forward requires a balanced approach – one that prioritizes both generation and grid investments.

Read our latest Trending Forward article for more information on how we can embrace innovation and build robust power networks that are ready for the future. That’s it for today. And stay tuned for the next Sustainable Equity Team’s Rendezvous.

Mirova Portfolio Manager Soliane Varlet and Equity Analyst Marine Michiels believe increased demand and infrastructure challenges highlight the need for substantial investment and modernization of aging electricity grid networks. Read more about the challenges and opportunities they see in this space in the years ahead.

Key takeaways

Numerous investment opportunities are emerging due to electricity grid expansion across the US and Europe, fueled by the growing demand for energy.
Businesses that are well positioned to benefit include utilities that invest in upgrading their networks, along with companies that supply electrical equipment and transmission cables.
Mirova also believes there are numerous investment opportunities across the electricity network value chain, including electricity production, transmission, and distribution.
However, lengthy planning and approval processes for electricity networks pose some challenges, and regulations that promote an affordable infrastructure investment will be crucial.
Policymakers worldwide will play a key role in establishing regulatory frameworks and subsidies that make investing in electricity networks a viable investment opportunity to facilitate grid expansion.
Electrification and infrastructure upgrades are important to move forward the net-zero agenda, and renewable energy will be vital for meeting the growing demand for electricity.

Powering the future: Building resilient energy grids

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The information, data, analyses, and opinions presented herein (including current investment themes, the portfolio managers’ research and investment process, and portfolio characteristics) are for informational purposes only, represent the views of the portfolio managers as of the date written, and are subject to change and may change based on market and other conditions and without notice.

This material is not intended to be a recommendation or investment advice; does not constitute a solicitation to buy, sell or hold a security or an investment strategy; and is not provided in a fiduciary capacity. The information provided does not take into account the specific objectives or circumstances of any particular investor or suggest any specific course of action. Investment decisions should be made based on an investor’s objectives and circumstances, and in consultation with his or her financial professionals.

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