With electric vehicles (EVs) set to account for almost 10% of global vehicle sales by 2025, the fossil fuel divestment movement is making gains with investors.
According to a report by Arabella Advisors, more than $5 trillion (€4.8 trillion) in investment funding is leaving fossil fuel stocks - double the market valuation reached only 15 months ago.
The $5 trillion represents the total dollar value of all the investments held by parties who have sold some or all of their fossil fuel investments, so is a measure of the influence these investors are having on financial markets.
‘It’s a stunning number,’ said executive director of the Wallace Global Fund Ellen Dorsey. ‘This movement began as an ethical concern, was quickly matched with financial concerns and I think it’s now being increasingly recognised as a fiduciary duty.’
The fossil fuel divestment movement began in 2011 on university campuses. Now 688 institutions and nearly 60,000 people in 76 countries have sold off some or all of their holdings in fossil fuel companies.
Navigant Research predicts that sales of all types of electric vehicle will grow from 3% of worldwide sales in 2016 to 9% by 2025. Of these, plug-in hybrids (PHEVs) will make up 72% of the total. The growing trend towards PHEVs is already evident in both the US and Europe, with the Chevrolet Bolt leading the electric vehicle market in the US, and the Mitsubishi Outlander PHEV topping the charts in Europe.
In 2017, Navigant expects PHEVs to make up more than 36% of EV sales. Their market dominance will be fully realised as carmakers expand application of the PHEV powertrain to new, larger vehicle body types, which battery electric vehicles (BEVs) typically are not designed to accommodate.
While hybrid electric vehicles (HEVs) are expected to make up 73% of the 2.6 million EVs sold in 2016, the decline of HEVs worldwide began in 2015; they will increasingly be replaced by PHEVs. However, HEV sales will still grow in Europe and China next year. In 2017, sales of 3 million EVs are forecast, driven by long 200 mile-range BEVs and the expanding availability of PHEVs. By 2018, half of EV sales will be PHEVs as the market surges to 3.7 million.
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