Save the planet and make money doing it? What’s not to love?
The green energy industry is worth $279.8 billion as of 2017. Although it still has competition from non-renewables, many countries have committed to investing in green energy solutions over the coming decades. With any new and exciting industry, there’s a chance to get in on the ground floor.
Still not sure why you should be investing in green energy? Then let’s take a closer look.
What’s the Situation?
Have you ever given a thought to how much energy we use in the modern world?
We all understand it in an abstract way. Only when you stop to think about how energy intensive our world has become do you begin to comprehend the scale of the problem.
Non-renewables can’t sustain the world’s exploding and industrializing population. Taking a glance at the rate of human population growth is enough to send anyone into a panic. It took the entirety of human history through to the 19th century to crack 1 billion. Now we’re over 7.5 billion, and our principal energy sources are finite.
Enter green energy. Renewable energy is an inevitable answer to the conundrum.
Politics provide yet another compelling reason for the development of renewables. Nations have fought wars over energy sources. In the Cold War hangover period we occupy, Western nations are desperate to gain energy independence from Russia and the Middle East.
Green energy has evolved in this socio-economic situation. In effect, renewables have some of the most powerful motivators in the world backing them up.
Why Invest in Renewable Energy?
Given the backdrop, the way for renewable energy seems clear. Its principal opponent is the fossil fuel industry – which can’t sustain itself forever. A rival industry is unlikely to keep green energy down when it has so many reasons to succeed.
That’s why the renewable energy industry is experiencing inevitable growth. Investments are pouring into the sector, and BP foresees 400% growth in the sector by 2040.
Rooftop solar arrays are becoming a common sight in developed nations. Infrastructure improvements are allowing nations to generate and store more energy from renewable sources. Nations are also wisening up about the exploitable resources they have to hand.
Britain hit its first ever coal-free day in 2017. China managed the same for a province of 6 million people. Those are only a couple of the many success stories coming out of renewables.
These successes aside, green technology is still new and growing. Renewables represent an exciting prospect for investment because their take-up seems inevitable and there’s still plenty of space for new investors.
Even the general public provides an excellent incentive. Studies show that customers now factor a company’s social responsibilities into their buying choices. Those responsibilities include limiting environmental impact.
How to Invest in Renewable Energy
So that’s the “why”. What about the “how”?
The most direct way to invest in renewables is to buy shares in major renewable energy corporations or their fast-growing competitors. Vestas Wind Systems, First Solar, Electrobras, and Motech are some of the biggest renewable companies around right now.
You don’t have to limit your view to the energy industry, though. Plenty of other companies are deep in the renewables game, from conglomerates like Siemens to brands like Tesla who are making future technologies their public face. Rewewables stand to influence our daily lives as much as they do our energy supplies.
ETFs offer an opportunity to invest in a company’s fortunes with lower risk. They present a fantastic opportunity for those who can’t afford to make daring investments but still want to break into the industry.
Some energy companies also issue bonds which can yield far greater interest rates than standard savings.
It’s easy to make a misstep when investing in energy. It’s even easier when the industry is still young, with many unknowns. Speaking to one of the energy industry’s many experts, Dr. Kent Moors can give you key investment insights to help you avoid obvious pitfalls.
The Future of Renewable Energy
Renewable energy investing is the perfect example of playing the long game. So far, it hasn’t yielded huge returns for investors. That’s because it’s a young industry with a huge potential for growth.
Support from many of the world’s richest nations along with environmental concerns and the dwindling of non-renewables continues to drive the uptake of renewables. Those factors create a stable platform for investment.
Of course, any investment carries its risks. The big risks for renewable energy renewal involve its position as a newcomer. Many of the companies involved are new or taking a chance on green energy.
A few political concerns could also impact green energy. In the US, the Trump administration’s commitment to “clean coal”, tariffs on solar energy, and their well-documented renewable skepticism has made investors nervous.
Meanwhile, the UK is tackling its own issues in the form of Brexit. It’s unclear whether the UK will now commit to EU renewable energy targets made before the referendum.
China is the dark horse of renewable energy. Despite the country’s poor environmental record, it stands as one of the chief proponents of green energy on the global stage.
China’s economy is also booming as the country undergoes a rapid modernization program, though the current trade war between China and the US remains a problem.
These represent some immediate concerns, but investors should take solace in the larger upward trend of green investment. Renewables have established themselves as the political and scientific future. As technology improves, green energy only becomes more attractive to its potential supporters.
Putting Money on the Future: Investing in Green Energy
You can’t invest in the future itself. But by investing in green energy, you can invest in an industry that’s almost guaranteed to dominate the energy discussion for the rest of your life. This makes it one of the most discussed and sought-after investments available today.
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