PRESS RELEASE: 87% of Investment Firms Expect Surge in Renewable Energy Financing in Wake of Iran Conflict

Investors overwhelmingly expect a surge in financing for renewable energy projects in the wake of the recent Iran conflict, a new poll has revealed.

The UK Sustainable Investment and Finance Association (UKSIF) sought the views of its members after the war, which began in late February, triggered one of the worst fossil fuel supply shocks in history. Investment firms managing a total of around £5.5 trillion in assets under management (AUM) completed the survey last month, where they reflected on the financing environment since the outbreak of the conflict.

The results revealed that 87% of respondents expect both global and UK-specific “investment in renewable energy projects” to increase following the start of the hostilities.

The findings also showed 78% of respondents felt global renewable energy investments were now “less risky relative to oil and gas” following the outbreak of the war. When considering solely UK-based renewable energy investments, 74% of participants thought these were now also less risky than oil and gas.

In addition, 87% of respondents said their “confidence in the long-term outlook for global renewable energy-related investments” had increased since the outbreak of the conflict. When considering just UK-based renewable energy-related investments, 78% of respondents shared the same opinion.

Since the outbreak of the war, 65% of respondents said the economic benefits of the UK rapidly transitioning away from fossil fuels now seemed “greater”.

These findings back up recent comments from the International Energy Agency’s (IEA) executive director, Fatih Birol. He told The Guardian renewable energy would receive a “significant boost” following the conflict due to emerging ‘risks’ of depending on oil and gas.

The IEA has also warned that global oil inventories are being depleted at a record pace, as the UK government announced plans to accelerate the rollout of clean power through the Energy Independence Bill in the King’s Speech.

Comments

UKSIF CEO James Alexander said: “Oil and gas companies may be reaping windfall profits from the global supply shock. But the new risks exposed by this crisis will likely push governments to fast-track their shift away from dependence on fossil fuels.

“The survey shows that investors believe this renewed focus on energy security will drive increased capital flows into renewable infrastructure assets. The UK has recently succeeded in securing critical financing for clean power projects, as demonstrated by the record-breaking renewable energy auctions earlier this year.

“But policymakers must continue to strengthen domestic financing conditions so that global investors recognise the UK as a leading destination to deploy capital.”

Brynn O’Brien, Co-CEO, ACCR (Australasian Centre for Corporate Responsibility), said: “This polling aligns with what we are observing in our work alongside large, diversified, long-term investors, particularly in the UK and Northern Europe. Concerns about the security and affordability of fossil fuels – particularly LNG – are boosting investor interest in renewable energy and storage.

“Energy-importing countries, especially in price-sensitive markets, are increasingly looking to reduce their reliance on imported oil and gas and shift toward lower-cost, more secure sources of energy. Vietnam’s recent decision to cancel plans for an LNG-to-power plant in favour of solar plus storage is one example of a broader trend.

“The traditional energy trilemma has collapsed. Energy security, affordability and decarbonisation are no longer competing objectives, with renewables now representing the preferred solution for all three. It is no surprise that investors are responding accordingly.”

Joe Crehan, investment director at Greenbank, said: “Just as the twin oil crises of the 1970s accelerated the strategic shift towards energy independence, the Iran conflict, which marks the second fossil fuel-driven energy crisis this decade after Russia’s 2022 invasion of Ukraine, is driving accelerated demand for renewables as the most secure path forward.

“Decarbonisation and energy security are not opposing forces: sustained investment in domestic low-carbon energy protects the UK economy from volatile global markets that have triggered around half of UK recessions since 1970, as the Climate Change Committee made clear in its seventh carbon budget advice.”

Matthew Clayton, CEO of Thrive Renewables, said: “We know that renewables are already helping to lower household bills, with data showing that record wind and solar in the UK has avoided the need for £1.7 billion worth of gas imports since the start of the Iran war. Investors are also readily aware that renewables lie at the heart of a fairer, cheaper and more secure energy system, evidenced by the 800 investors we recently mobilised as part of our £5 million crowdfunded bond offer.”

Beverley Gower-Jones, OBE, Founder and Managing Partner at the Clean Growth Fund, said: “This latest fossil fuel-driven crisis further reinforces our investment thesis: investing in the growth of a local clean economy. We believe there is a once-in-a-generation opportunity to participate in the clean industrial revolution, creating high-quality jobs and strengthening UK industry.

“This opportunity extends far beyond energy alone. In our view, renewable energy is inherently less risky than oil and gas, but the same principle applies across the wider value chain. Many clean alternative products and technologies present lower long-term risks than incumbent petrochemical and traditional solutions that contribute to climate change, environmental degradation, and biodiversity loss.

“The UK’s clean technology ecosystem is rich with innovation and opportunity across every sector of the economy from energy and transport to food and agriculture, the circular economy, buildings, and industry.”

Chris Tanner, Partner, Head of Portfolio, Real Assets at Foresight Group, said: “This UKSIF research reflects a growing recognition that renewable energy investment is not only critical for decarbonisation, but also for long-term energy security and economic resilience. Recent volatility in global energy markets has highlighted the risks associated with fossil fuel dependency, with institutional investors increasingly focused on sustainable infrastructure assets offering long-term stability.

“The listed renewables investment company sector provides exposure to portfolios of mature renewable assets, including those managed by Foresight, at a time when the role of infrastructure in supporting the energy transition is becoming more prominent. This research provides further evidence that 2026 could be a pivotal year for the global energy transition.”

Notes to editors

UKSIF polled its investment manager members between April 9 and April 29. Each response was completed by a senior representative of a participating firm. In cases where UKSIF received two or more survey responses from the same firm, the most senior employee’s answers were only included in the final results. Percentages were rounded to the nearest whole number. Free to use photo of UKSIF CEO James Alexander: https://uksif.org/wp-content/uploads/2022/01/James-Alexander-UKSIF.jpg

Recent figures from Zero Carbon Analytics show “positive investor sentiment rising on renewables’ short-term returns”, as clean energy equity funds outperformed oil and gas equity funds over the course of the Iran war.

BloombergNEF New Energy Outlook 2026 revealed that recent, successive energy market shocks could be a boon for the energy transition as some countries look to decouple from imported fossil fuels and bolster their energy security.

Background

UKSIF is a leading membership organisation that brings together the country’s sustainable investment and finance community and supports its members to expand, enhance and promote this key sector. Our more than 300 members, who have £19trn in assets under management (AUM), include investment managers, pension funds, banks, financial advisers, research providers and NGOs, among others. Our members are active in and supportive of efforts to promote the sustainable finance agenda. Together, we work closely with policymakers and others to find new ways to overcome the barriers to the growth of sustainability and deliver progress towards decarbonisation of the economy.