In this SektorReport, we are focussing on the Energy Efficiency (E2) sector. Artificial intelligence has the potential to significantly improve the energy efficiency of companies and utilise resources more sustainably. At the same time, however, the sharp rise in energy requirements of data centres as a result of AI continues to drive the use of (fossil) fuels. This report sheds light on the ambivalent effects of AI on energy consumption and thus on the achievement of net zero targets. In this context, we highlight the financing round of Flower Infrastructure Technologies AB, which emphasises the relevance of AI for the subsector Energy Efficiency. 

While valuations of high-tech companies in growth areas such as AI are currently set very high, valuations in the sustainability sector remain constant in the period under review and show a slight decline in the fourth quarter of 2024. While the Food, Agriculture & Forestry (E7) subsector continues to have the highest valuations, the Energy Efficiency (E2) subsector analysed in this report remains in the middle of the sustainability subsectors with valuations of around 8.0x EV/EBITDA. 

Despite existing geopolitical uncertainties, the medium and long-term outlook for M&A in the energy efficiency sector is promising. The transition to a more sustainable economy is being driven by EU initiatives such as the Energy Efficiency Directive (EED) and the ‘Fit for 55’ package. These measures aim to reduce energy consumption, increase energy efficiency and thereby achieve significant CO₂ reductions by 2030. Investment in technologies to increase energy efficiency continues to grow, making the E2 sub-sector particularly attractive for investors who are focussed on sustainability and long-term value creation.

Our SektorReports are available in German language. If you have further questions regarding this topic, feel free to get in touch.