Renewable Energy

Why Fighting Climate Change Is Good for Your Investment Portfolio

Climate change isn’t just a political issue. Its impacts are increasingly touching many parts of our lives.

According to the Pew Research Center, a growing number of Americans see global climate change as a major threat.

In 2009, just 44% of Americans thought climate change was an issue. Today, that number has risen to 60%.

We must all work together to slow it down. And eventually, we might stop climate change’s advance altogether.

This issue is on President-elect Joe Biden’s front burner. And as an astute investor, you should have it on yours too.

Our New Priorities

Last week, I wrote about green hydrogen as a way to store excess renewable energy produced during the day.

Plenty of energy storage is being rolled out by utilities. They are using today’s lithium-ion-based storage systems.

We will need lots of these systems to store all of the excess energy. We’ll need at least 100 gigawatts of extra storage over the next 10 years, according to the U.S. Energy Storage Association (ESA).

The bulk of the new storage will support solar and wind power. Electric vehicles and distributed energy networks will benefit too.

Supporting wind and solar is a must-do when it comes to fighting climate change. So is decarbonizing our electric grid.

Grid-based energy storage is a critical piece of the puzzle because it can help with many energy issues.

We all want electric service that’s reliable and resilient. Extreme climate events like storms, hurricanes, wildfires and heat waves are becoming more frequent.

Many of those events regularly disrupt the power grid. And energy storage is the missing link that makes the grid more reliable.

So in order to increase the number of energy storage systems in the U.S., the federal government has to get involved.

Acting on Energy

Back in September, the ESA and more than 70 stakeholders lobbied the Senate to pass the American Energy Innovation Act (AEIA). The bill has already been passed by the U.S. House of Representatives.

The AEIA contains measures sponsored by more than 60 senators from both sides of the aisle. It’s intended to continue the modernization of our energy laws.

The last time a big energy bill was passed was in 2007 under the Bush administration. Thanks to “W,” we all are now enjoying cheap LED lighting. It uses a fraction of the electricity that incandescent lighting uses.

The AEIA continues to focus on energy efficiency. But it is much more far-reaching in scope than W’s 2007 bill.

Besides energy efficiency, it has key provisions for carbon capture, utilization and storage. It also is focused on advanced energy storage, renewable energy, and the modernization and security of our power grid.

The Next Millionaires

By 2050, the world is expected to use almost 50% more energy than it does today. That power needs to be affordable and clean.

Clean energy comes in many forms. And that’s where the investment opportunities are going to be.

Investing in oil and gas at this point is a fool’s errand. But plenty of new millionaires will be made by investing in renewable energy, EVs and green hydrogen.

Will you be one of them?

Good investing,

Dave

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