{"id":35201,"date":"2025-01-06T20:20:00","date_gmt":"2025-01-06T14:50:00","guid":{"rendered":"https:\/\/kuvera.in\/blog\/?p=35201"},"modified":"2025-01-06T20:20:00","modified_gmt":"2025-01-06T14:50:00","slug":"can-you-invest-in-green-energy-with-mutual-funds-india","status":"publish","type":"post","link":"https:\/\/kuvera.in\/blog\/can-you-invest-in-green-energy-with-mutual-funds-india\/","title":{"rendered":"Can You Invest in Green Energy with Mutual Funds India?"},"content":{"rendered":"

The answer to the titled question is \u2018Yes\u2019, you can invest in green energy through mutual funds India.\u00a0<\/span><\/p>\n

Over the past decade, India has made significant strides toward adopting renewable energy sources, with a shift from conventional fossil fuels to cleaner and more sustainable alternatives. This shift is part of the country\u2019s broader goal to reduce carbon emissions, meet climate targets, and ensure energy security.<\/span><\/p>\n

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\"Start<\/a><\/b><\/h4>\n

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Shift of the Energy Sector Towards Green Energy<\/b><\/h2>\n

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The global shift toward renewable energy has been gaining momentum as countries strive to address climate change. In India, the government has set ambitious targets to increase the share of renewable energy in the national energy mix. India’s energy sector is undergoing a major transformation, with significant investments in solar, wind, hydro, and biomass energy. The push towards green energy is also driven by the need to reduce dependence on coal and other polluting fossil fuels, which contribute to environmental degradation and health problems.<\/span><\/p>\n

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Government of India’s Initiatives<\/b><\/h2>\n

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1. National Action Plan on Climate Change (NAPCC)<\/b><\/h4>\n

The Indian government launched the NAPCC to promote sustainable development and climate resilience by enhancing energy efficiency and increasing the share of renewable energy sources.<\/span><\/p>\n

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2. Renewable Energy Targets<\/b><\/h4>\n

India has set a target of achieving 500 GW of non-fossil fuel-based capacity by 2030 and has already surpassed its previous target of 175 GW of renewable energy capacity, with solar and wind energy being the key contributors.<\/span><\/p>\n

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3. International Solar Alliance (ISA)<\/b><\/h4>\n

India has been a strong advocate for global efforts to accelerate the deployment of solar energy. India\u2019s ISA, aims to bring together solar-rich countries to enhance collaboration on solar energy research and deployment.<\/span><\/p>\n

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4. Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME)<\/b><\/h4>\n

The government also incentivizes the adoption of electric vehicles (EVs) through initiatives like FAME, to reduce carbon footprint of transportation.<\/span><\/p>\n

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5. Pradhan Mantri Ujjwala Yojana<\/b><\/h4>\n

It aims to provide clean cooking fuel (LPG) to households, replacing traditional biomass-based cooking, which is harmful to both health and the environment.<\/span><\/p>\n

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Mutual Funds Investing in Green Energy<\/b><\/h2>\n

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Several mutual funds in India have recognized the growing importance of sustainable and green investments focussing on sectors like renewable energy, electric vehicles, and clean technologies. While mutual funds in India don\u2019t always focus exclusively on “green energy,” there are Environmental, Social, and Governance (ESG) focused funds, which invests in companies with sustainable practices, including renewable energy companies. Some of them are:<\/span><\/p>\n

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Top 10 ESG Mutual Funds with 1-year Return<\/strong><\/h4>\n

 <\/p>\n\n\n\n\n\t\n\n\t\n\t\n\t\n\t\n\t\n\t\n\t\n\t\n\t\n\t
S. No.<\/th>Name of the Fund<\/th>1 Yr return (%)<\/th>TER (%)<\/th>Fund House<\/th>\n<\/tr>\n<\/thead>\n
1<\/td>ICICI Prudential ESG Exclusionary Strategy Growth<\/td>24.1<\/td>1.01<\/td>ICICI Prudential Mutual Fund<\/td>\n<\/tr>\n
2<\/td>Aditya Birla Sun Life ESG Integration Strategy Growth Direct Plan<\/td>23.09<\/td>1.4<\/td>Aditya Birla Capital Mutual Fund<\/td>\n<\/tr>\n
3<\/td>Invesco India ESG Integration Strategy Growth Direc<\/td>22.65<\/td>0.97<\/td>Invesco Mutual Fund<\/td>\n<\/tr>\n
4<\/td>Quant ESG Equity Growth Direct Plan<\/td>19.03<\/td>0.79<\/td>Quant Multi Asset Multi Manager<\/td>\n<\/tr>\n
5<\/td>Axis ESG Integration Strategy Growth Direct Plan<\/td>18.73<\/td>1.3<\/td>Axis Mutual Fund<\/td>\n<\/tr>\n
6<\/td>Quantum ESG Best In Class Strategy Growth Direct<\/td>16.64<\/td>0.85<\/td>Quantum Mutual Fund<\/td>\n<\/tr>\n
7<\/td>Kotak ESG Exclusionary Strategy Growth Direct Plan<\/td>14.15<\/td>0.81<\/td>Kotak Mahindra Mutual Fund<\/td>\n<\/tr>\n
8<\/td>SBI ESG Exclusionary Strategy Growth Direct Plan<\/td>13.81<\/td>1.31<\/td>SBI Mutual Fund<\/td>\n<\/tr>\n
9<\/td>Mirae Asset ESG Sector Leaders FoF Growth Direct Plan<\/td>11.73<\/td>0.46<\/td>Mirae Asset Mutual Fund<\/td>\n<\/tr>\n
10<\/td>Whiteoak Capital ESG Best In Class Strategy Growth Direct Plan<\/td>NA<\/td>0.59<\/td>Whiteoak Capital Mutual Fund<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n\n

Source: Kuvera; December 31, 2024.<\/span><\/p>\n

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The above listed Top 10 ESG Mutual Funds in 2024, showcase various strategies focused on sustainable investing, with a primary emphasis on environmental, social, and governance (ESG) factors. These funds include:<\/span><\/p>\n

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  1. Exclusionary Strategy: <\/b>Funds like ICICI Prudential, Kotak and SBI exclude companies that fail to meet ESG criteria, focusing on ethical investments.<\/span><\/li>\n
  2. ESG Integration Strategy<\/b>: Aditya Birla, Invesco and Axis integrate ESG factors into the investment decision-making process.<\/span><\/li>\n
  3. Best-in-Class Strategy<\/b>: Quantum and Whiteoak invest in companies that excel in ESG practices within their industries.<\/span><\/li>\n<\/ol>\n

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    Key Insights of These Funds<\/b><\/h3>\n

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