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Opinion: This is where investors can make money in Biden’s climate change goals

Those who say the government cannot choose a winner often point to Solyndra, a thin-film solar cell company that went bankrupt in 2011 after receiving $ 535 million in money from the Obama administration. But they often stick out their tongues when challenged to name the second example.

Unlike venture capitalism, where some startups once seemed promising failure while others might have been spectacularly successful, the government certainly couldn’t choose all of them. Over the years, however, it has collected taxpayers’ money on ideas that have been spectacularly successful and changed the way Americans live. To name but three: GPS, robot and perhaps the biggest thing ever: the Internet. I understand that the Internet has been involved in fair wealth creation over the past quarter century.

So maybe we shouldn’t be ridiculous when President Biden speaks loudly about shifting America away from fossil fuels and moving to solar and wind power. He argues that these industries are the winners that will not only help the United States cut fossil fuels, but also create lasting wealth and jobs along the way. (They already have.)

Clean energy

Where is the money to make today? One of the more popular investments in the renewable energy space is the iShares Global Clean Energy ETF.
+ 0.29%
Even after falling around 27% this year, it still triples from the market low in March 2020. If you think renewable energy will continue to increase its share in total In the energy sector of the United States in the coming years, the first ICLN – the decline in the quarter could represent an entry point for anyone looking for a long term hold and diversification.

You can also make money in other ways. When cell phones started to grow, some entrepreneurs made money renting out land to build cell phone towers. Similar models exist today for solar and wind farms. For example, one of the world’s largest onshore wind farms is located in Texas, where there is plenty of land and wind. Your investment game here can be a real estate investment trust. A REIT in this area is Hannon Armstrong Sustainable Infrastructure Capital Inc.
This has also backed off this year after the very clear 2020 end.

Fossil fuel companies

Meanwhile, we don’t think the oil and gas industry is all about trees embracing tree trunks, but this is changing, and could be opportunistic. Royal Dutch Shell
+ 0.85%
The transition from fossil fuels, for example, has announced it will close seven out of 13 refineries, part of a plan to cut gasoline and diesel output by 55 percent over the next decade.

American giant fossil fuel corporation ExxonMobil Corp.
+ 0.58%
Chevron Corp.
+ 0.28%

and NRG Energy
+ 0.03%
not exploring oil and gas, but they also understand that there is money to fight carbon and are rushing into the carbon capture and absorption (CCS) space.

CCS works by keeping CO2 at its source of emissions and storing it, often deep underground, to prevent it from entering the atmosphere. Maarten Wetselaar, director of integrated gas, renewable energy and energy solutions at Shell, called this Not just a solution, but an actual business. ExxonMobil CEO Darren Woods even offered a price tag: $ 2 trillion by 2040 – nearly 8.4 times the size of the company’s market capitalization.

And employment? Woods says a massive CCS effort “could create tens of thousands of new jobs needed to build and install equipment that captures CO2 and transports it through pipes for storage.” It will also, he declared, “protect thousands of existing jobs in industries looking to reduce emissions. In short, large-scale CCS will reduce emissions while protecting the economy.

This is much more than being altruistic towards the environment. The Irving, Texas-based company wants to lower taxes or set carbon pricing to help boost its efforts. The first thing would put Biden in the dilemma of assisting one of the country’s polluters, a move that environmentalists oppose. What is needed, they say, is a light-free approach to fossil fuels. As for carbon prices, this has been an approach that the president has so far avoided.

Industry boosting

It’s not just the fossil fuel industry that is green. More than 400 large corporations, representing seven million workers in all 50 states and with annual revenues of more than $ 4 trillion, is also on board.

In a letter to the president, the group called itself “Our Average Business Alliance,” saying cutting greenhouse gas emissions would drive a strong economic recovery, created millions of well-paid jobs and allowed the United States to “rebuild better” From the pandemic.

The group includes automotive giants like General Motors
+ 1.27%

and Ford
+ 0.32%
retail giant Walmart

and Amazon
+ 2.08%
technology giant Apple
+ 0.08%
+ 0.92%

and Facebook
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corporations like General Electric
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restaurant chains like McDonald’s

and dozens of property management firms.

Some of them are not waiting for feds. Microsoft CEO Satya Nadella, who said the corporation’s aim is to “find solutions that benefit human and planet problems” has spurred decades-long carbon reduction efforts. software and cloud computing giants. It is investing $ 1 billion over four years to develop the technology needed to remove greenhouse gases from both the atmosphere and elsewhere; CFO Amy Hood calls the carbon negative a “good return on investment”.

Real estate market

Where can I make money here? I wrote that last week real estate prices soared has priced millions of Americans out of the market for single-family homes. In addition to being too expensive, they are also harmful to the environment.

“Among residential housing types, single-family homes are by far the most environmentally destructive,” a Research by Georgetown University. One way to achieve two things at the same time – more affordable housing and less carbon production – could be to regulate zoning laws that typically encourage the building of single-family homes, often at the expense of multi-family housing units.

Between the environmental damage caused by single-family homes and severe housing shortages in the country, there could be an explosion of growth in multi-family housing units. Two publicly traded companies for consideration in this area are likely Residential Joint Stock Companies
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and AvalonBay Community
+ 0.61%



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