The demand for cleaner sources of energy has been increasing. More people are aware of the need to find alternative sources of energy and countries are beginning to realize that there is a real need for a cleaner infrastructure.
Green energies are becoming a safer investment, too, as regulators are implementing new standards to improve this industry.
It is estimated that green energy plants will account for 60% of all energy production in the U.S. by 2030 and that over $5 trillion will be spent on new green power plants by then.
Adding green energies to your portfolio is a smart way to gain exposure to a sector that will keep growing both in the short and long term.
Besides, investing in green energies is a great way to ensure your money is being spent on environment-friendly projects. The green energy sector is also a source of new jobs.
Consider these ways to include green energies in your portfolio:
Invest in manufacturers. The growing demand for cleaner sources of energy means manufacturers will be making solar panels, wind turbines, and other green energy systems that have not even been invented yet.
Look for manufacturers who are dedicated to making their products more efficient and who invest in research and development.
Buy shares of larger energy companies. Local energy providers are making efforts to provide their customers with cleaner sources of energy, either by investing in clean power plants or by purchasing the energy produced by homeowners who have invested in solar panels or wind turbines. Plus, they are creating green energy jobs.
Look into investing in foreign companies. Keep these things in mind when investing on the foreign market:
Harvesting solar power is much more lucrative in countries located near the equator, which means this industry is likely to boom in several foreign countries.
The solar industry is doing very well in China and in some European countries where governments are actively investing in clean energies.
Learn about regulations and policies regarding green energies before investing in foreign companies that manufacture or distribute clean energy.
Broaden your horizons with new technologies. For example, companies like Tesla Motors are working on transforming the automotive industry by making reliable electric vehicles. This is only one of the many companies that are tackling the issue of renewable energy with a unique approach.
Invest in your own clean energy system. Buying a green energy system is a long-term investment:
If you are a homeowner, consider purchasing your own solar panels or small wind turbine to reduce your bills and increase the value of your home. You can start with smaller devices such as solar-powered water heaters or solar-powered chargers for your electronics.
Purchasing your own green energy system may be worth it if your exposure to sun rays or wind is sufficient to produce enough power to justify your investment.
Investing in green energies will strengthen your portfolio since this sector is expected to grow. One day, green energy may even replace traditional energy production and distribution systems. You can take advantage of several ways of diversifying your portfolio with green energies.
As with any investment, ask yourself what your goals and risk tolerance are, and perform your due diligence on any proposed investment, before spending your money.
Take the time to learn more about green technologies and companies. Adding green energies to your portfolio is a good way to make a socially responsible investment.