Learn more about our Renewable Energy Portfolio

Nicole Sara Sivens
April 24, 2018
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Why should you invest in renewable energy?

Renewable energy is energy that is collected from renewable resources, which are naturally replenished on a human timescale – sunlight, wind, rain, tides, waves, and geothermal heat are all examples of renewable energy.

When you think about renewable energy, your mind may go to sleek solar panels and wind turbines spinning in the desert air. Take it a few steps back, now go a little further. Picture a boat sailing down the Nile while pyramids are being built in the distance.

Before the world began to power itself with coal in the mid 19th century, renewable energy was the standard. And long before that it was fire, steam, and wind that kept the world moving. Moving a little bit farther up the timeline, it was human labor, animal power, and wind turbines.

So while the technologies that we use in our day-to-day life are indeed the newest and latest, they’re just a modern adaptation of things we’ve done for centuries..

When renewable energy sources are used, the demand for fossil fuels can be reduced. Unlike fossil fuels, renewable sources of energy do not directly emit greenhouse gases, which is good for our planet (but you knew that).

Energy use is expected to rise by a third between 2010 and 2035 due to increases in population and urbanization. If we don’t move on to electricity generated from renewable sources, we won’t be able to curb CO2 emissions.

Today, renewable energy accounts for almost 15% of all energy used worldwide and is projected to have an $800 billion market share by 2019.

Why don’t we use more renewable energy?

Since our world today is a little more complicated (and regulated). So thankfully a simple king’s decree that 100,000 people build him a pyramid real quick doesn’t make it happen. Harnessing a source of power that exists naturally and wildly isn’t as easy as it once was.

For the most part, renewable energy has been more expensive to produce and to use than fossil fuel energy – but that is changing. Wind and solar are cheaper than all forms of coal today, and approaching or equal to natural gas generation.

The resources are often located in remote areas, and it can be expensive to build power lines from the renewable energy sources to the cities that need the electricity. However, as the price of renewable energy gets cheaper, many believe that solar energy could become the world's biggest single source of power by 2050.

Another consideration is that renewable sources are not always available. In an attempt to harness the power of the planet without destroying it, we put ourselves at its mercy. Cloudy days reduce electricity from solar power plants, low wind days take away electricity from wind farms, and droughts diminish the water available for hydropower.

What are some examples of companies creating renewable energy?

To solve for these issues, companies are innovating in ways that previous generations could have only imagined.

The hydropower issue mentioned above? Countries are adopting battery energy storage to capture power when the sun shines bright to be used when it doesn't. Tesla just installed a bunch in Australia.

For example, Vestas Wind Systems, the world’s biggest maker of wind turbines, is moving into artificial intelligence to increase the reliability of renewable energy. The company paid $100 million for a New York-based Artificial Intelligence startup that grew out of IBM’s Smarter Energy Research Institute. The software acquired in the deal by the Danish wind giant will help it crunch numbers to improve the uptime and revenues of wind farms.

In another, more relatable story, Sunrun, the largest dedicated residential solar, storage, and energy services company in the United States, announced an expansion of its partnership with GRID Alternatives, a national leader in making solar power and jobs accessible to underserved communities. This means that more homes than ever will qualify for loans for solar panels, making it the new go-to for communities that never before had access.

Previous generations innovated because they wanted to. The companies in our portfolios innovate because they have to. We target our investments in companies that are harnessing natural resources to power our world. This could mean big things for the planet—and our portfolios. Check out Tesla, Vestas, and Sunrun (and a few dozen others) in our Renewable Energy Portfolio. Learn more about our holdings and invest in progress.

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