Page 41 - DIY Investor Magazine | Issue 30

‘A POWERFUL BLEND OF SOCIO-ECONOMIC NEED BACKED BY A SHIFT IN GLOBAL GOVERNMENT POLICY USHERING SOLAR INTO THE MAINSTREAM CONSCIOUSNESS’
The illustration shows electricity and heat producers account for 51% of carbon emissions globally, while industries account for 28% of total emissions, transportation’s share is 10%, residential’s share is at 4%, other energy industries at 3%, commercial and public services at 2% and others at 2%.
On the cost side, it is important to note that conventional energy from fossil fuels (i.e., coal, oil and natural gas) has dominated the global power supply because until recently, electricity from fossil fuels, especially coal, was far cheaper than electricity from renewables (i.e., solar, wind, rain and geothermal heat). This has dramatically changed within the last decade.
In most places across the globe, power from new renewable energy sources is now cheaper than power from new fossil fuels.
In fact, solar energy is now the cheapest new source of
global electricity in most developed countries. With solar less expensive today than fossil fuels, this may serve as a key driver of rapid wide-scale adoption.
In the United States, there has been an ongoing trend away from conventional toward renewable energy. The U.S. Energy Information Administration (EIA) forecasts that the share of renewables in the U.S. electricity generation mix will increase from 21% in 2020 to 42% in 2050.
Wind and solar are responsible for most of that growth. The renewable share is projected to increase as nuclear and coal- fired generation decrease and the natural gas-fired energy generation share remains relatively constant.
From a bottom-up perspective, growing global demand for sustainable green energy solutions has created investment opportunities for companies throughout the solar energy supply chain, meaning that-the transition to clean energy is seen as net-jobs positive.
At this point, the investment case for Solar Energy, like with many ESG related themes, has moved beyond pure altruism. Its innovation born out of necessity, with a powerful blend of
socio-economic need backed by a shift in global government policy ushering Solar into the mainstream consciousness.
It has been said before that ‘Green is the new Growth’ and given the pivotal shift toward renewable energy, and the continued development of the technology to support it, Solar Energy may present an opportune entry point for investors looking for their day in the Sun.
INVESTING IN SOLAR ENERGY
Investors looking to get a slice of themes such as the solar energy sector can consider exchange traded funds (ETFs). ETFs enable investors to invest in a broad basket of securities that represent companies from a specific sector or theme such as cloud computing , the space economy or solar energy.
HANetf is an issuer of a wide variety of megatrend thematic exchange traded funds (ETFs). When you invest in ETFs, your capital is at risk.
Jane Edmondson is the Co-founder of the Solar Energy UCITS ETF – follow the link for more information.
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41 DIY Investor Magazine | Sept 2021