Green Innovation and Investors

President Trump may have announced his intention to drop the U.S. from the Paris Agreement last June,1 but that didn’t stop commerce from pressing on with “green” innovation. Drawing from lessons learned from the emerging renewable energy industry, many global corporations have found there is money to be made by saving the world from pollutants.

More than 2.5 million Americans work in the “clean tech” sector, with employment in the solar industry alone boasting a 123 percent increase over the last six years. Even in sectors that are experiencing high research and development costs, profits are possible because the market for renewables grows stronger each year.2

For investors, fossil fuels versus green innovation doesn’t have to be an either/or decision. Investment portfolios can hold stakes in tried-and-true blue-chip companies, many of which are expanding to include renewable divisions, as well as pure green startups.3

However, as with any investment, it’s important to consider investor goals, timelines and tolerance for risk with market opportunities. We work with clients every day to establish an asset allocation strategy that reflects both their circumstances and their interests. If you’re interested in a comprehensive review of this nature, we’d be happy to schedule a time to discuss this with you further.

We all know that the basis of solar power is exposure to the sun. While in the past, solar companies have focused on harnessing this exposure with roof panels, new innovation is exploring energy-harvesting windows and solar glass blocks in place of traditional brick siding. Both advances offer both light and heat sources for buildings and residences.4

As far as the new tax bill goes, there’s good news on the green front. The legislation retains existing tax credits for renewable energy and includes a $7,500 federal tax credit for the purchase of new electric vehicles.5

While clean energy may still cost more on some fronts than traditional energy sources, the cost comparisons are inconclusive. For one thing, they do not represent the cost of addressing pollution and health concerns generated by fossil fuels. If the price of coal, for example, included these ancillary expenses, cleaner renewable energy would appear much more affordable.6

And that doesn’t even include benefits to the environment.

1 Michael D. Shear. The New York Times. June 1, 2017. “Trump Will Withdraw U.S. From Paris Climate Agreement.” https://www.nytimes.com/2017/06/01/climate/trump-paris-climate-agreement.html. Accessed Jan. 18, 2018.

2 Brian La Shier. Environment and Energy Study Institute. Feb. 1, 2017. “Going Green in 2017: The Business Case for Renewable Energy.” http://www.eesi.org/articles/view/going-green-in-2017-the-case-for-renewable-energy. Accessed Jan. 18, 2018.

3 Jeremy Berke. BusinessInsider.com. Dec. 17, 2017. “The world’s largest oil and gas companies are getting greener after fighting with shareholders for months.” http://www.businessinsider.com/exxon-shell-bp-announce-renewable-energy-and-climate-initiatives-2017-12. Accessed Jan. 18, 2018.

4 Ben Coxworth. New Atlas. Aug. 16, 2017. “New glass blocks may be a clear choice for solar power.” https://newatlas.com/solar-squared-glass-blocks/50925/. Accessed Jan. 18, 2018.

5 Cathy Proctor. Denver Business Journal. Dec. 21, 2017. “Wind, solar, oil and gas — What the federal tax overhaul does for them.” https://www.bizjournals.com/denver/news/2017/12/21/wind-solar-oil-and-gas-what-the-federal-tax.html. Accessed Jan. 18, 2018.

6 John J. Berger. The Huffington Post. Dec. 21, 207. “Fostering Clean Energy Innovation — Financial Advisor Explains How To ‘Put A Stake in Fossil Fuel Industry’s Heart’.” https://www.huffingtonpost.com/entry/fostering-clean-energy-innovationfinancial-advisor_us_5a3c374fe4b0df0de8b063dc. Accessed Jan. 18, 2018.

 

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