The emerging energy markets are a dynamic and rapidly evolving landscape, presenting a blend of challenges and opportunities in the global energy sector. This article delves into the intricate world of these burgeoning markets, exploring how gaining access to affordable energy in these nations is challenging. From the push for renewable energy to replacing dirty fossil fuels through energy transition and foreign investment, we will explore how the global energy economy is shaping these emerging markets.
What Are Emerging Energy Markets?
Emerging energy markets refer to new, or rapidly developing, markets or nations within the global energy economy. Oftentimes, these markets have been historically underdeveloped and unsophisticated making them ripe for change, investment, and growth. In fact, many foreign energy investors in the African emerging markets claim that it is easier to implement modern energy technologies since there is no existing fossil fuel infrastructure in place. Either way, there are many emerging energy markets in today’s economy that are adopting renewable energy sources and benefitting from energy transition.
Challenges In Emerging Energy Markets
Although many of these emerging markets are ripe for investment and change, they do not come without their challenges. Some of those challenges include poor economies, lack of energy infrastructure, corrupt government oversight bodies, and a lack of framework to transport commodities or other raw materials into or out of the country.
The Top Emerging Energy Markets Around The Globe
The top five emerging energy economies in the world include India at number one, Chile, Brazil, China, and Kenya. While several other African and South American countries are also considered to be rapidly emerging on the energy front, it is the move towards clean energy in these nations that is driving the growth. In fact, look at the climate score rankings of the top emerging economies in the chart below:
Energy Investment Opportunities In Emerging Markets
Since many emerging economies are unsophisticated and young, there is room for great improvements and growth. Many outsider investors see opportunities in emerging markets to help lay the framework for a brighter energy future. Let’s explore some of the top investment opportunities in more detail:
Renewable Energy
Renewable energy investments in emerging markets far outpace all other energy opportunities. Because renewable energy sources, such as wind and solar, do not always require grid infrastructure, they can be simple to install and deploy in these markets. In fact, much of the growth in India and other developing countries is coming from renewable energy sources.
Cleaner Power Generation With LNG
Most of the emerging economies rely on oil to generate electricity. And while this can be an effective way to get power, it can be costly and have negative environmental impacts. Several companies, such as New Fortress Energy, are paving the way to a brighter future using LNG, or liquified natural gas. Natural gas burns much cleaner than oil and its prices tend to be more stable, making it a better alternative for generating electricity. New Fortress Energy has built LNG terminals and natural gas power plants in countries like Brazil and Jamaica to help pave the path towards more affordable energy.
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