Goldman Sachs says Europe’s energy transition is a huge opportunity for investors, in areas ranging from energy storage to charging infrastructure to transport networks. The investment bank says infrastructure investments of 10 trillion euros (about $10 trillion) will be needed for the transition, as Europe aims to achieve net zero emissions by 2050. “Cumulative infrastructure investments of 10 billion euros will be needed by 2050 for Europe’s energy transition, reaching the equivalent of > 2% of GDP by 2030”, the analysts said. Goldman wrote in a July 20 report. They add that it will reduce the region’s net energy import dependency ratio from 58% to 15% by 2050. The drive towards alternative forms of energy for Europe becomes all the more urgent due to Ukraine war, when Russia threatened to shut down gas. supply to Europe. The European Union already receives about 40% of its natural gas from Russia. Here are the opportunities the bank said investors should look for. Solving the problem of energy storage According to Goldman, hydrogen will be important in the long-term transition to renewable energy. The investment bank said hydrogen would address “seasonal disparities between renewable energy supply and electricity demand and support decarbonisation in heavy industry and transportation”. The EU’s energy infrastructure is not yet fully established to handle the potential for disruption of renewables – it is difficult to store energy from renewables for times when the sun is not shining and wind does not blow. The EU’s energy infrastructure is not yet built to handle the intermittent nature of renewable energy, which depends on favorable weather conditions. Like natural gas, hydrogen can be stored underground. It could also be used as a way to store energy from intermittent renewable sources such as the sun and wind, which produce more at certain times and less at others. Utilities can convert excess electricity from solar and wind energy into hydrogen, and save it for later use as an alternative to battery storage. Goldman analysts point out that natural gas consumption varies considerably over time of year. And that “seasonal mismatch” makes it very difficult to replace Russian gas with renewables because the months with the most solar power generation are also the months with the least consumption. “As the pace of renewable energy development accelerates, day-to-day and seasonal variations must be addressed through energy storage solutions,” Goldman analysts wrote. According to the report, hydrogen, as well as utility-scale batteries, will help address that challenge. Overall, the infrastructure around renewable power generation, energy storage and related networks will represent a €6 trillion investment opportunity, Goldman said. Hydrogen demand itself will create a €0.74 trillion opportunity in the supply chain in Europe, it added. In a separate note in July, Goldman named two clean energy stocks – Enphase Energy and Sunrun, companies that develop battery energy storage and solar power generation products. Enphase says Enphase will focus on very strong growth expectations in Europe. Trucking Goldman says electrification is seen as an important decarbonizing technology for Europe’s road transport, including passenger cars, trucks and commercial vehicles. While electric vehicles may be the most attractive decarbonization solution for short- and medium-haul transportation, the development of fuel cell electric vehicles will accelerate significantly in heavier transport vehicles such as buses. and forklift. Electric vehicles run on batteries, while electric vehicles run on fuel cells mainly run on hydrogen. “We believe trucking is at the beginning of the most significant technological change in a century, with electrification, autonomous driving and clean hydrogen at the core of the challenge,” Goldman said. decarbonization”. Goldman says critical charging and refueling infrastructure in decarbonized transport will create a €0.6 trillion investment opportunity in Europe. Clean hydrogen and other hydrogen-derived fuels – synthetic fuels, ammonia and methanol – will emerge as important energy sources, it added. “Transport’s ability to facilitate energy development, given the rapid rise of electrification and alternative fuels, calls for substantial infrastructure investments,” Goldman writes. which we estimate is 0.6 trillion euros by 2050,” Goldman wrote. “This is imperative for the growing number of public as well as private chargers as well as alternative refueling stations.”