Thursday, January 21, 2010

Blue Chip Renewable Energy Stocks

In our increasingly environmentally conscious global economy, will blue chip renewable energy stocks be economically viable to be issued in the near future?


By: Ringo Bones


After seeing Gordon Johnson of Hapolim Securities discussing on Bloomberg TV back in January 17, 2010 about why solar stocks are still hot, I start to wonder if renewable energy stocks will ever become blue chip stocks. With the discussion centered on Germany’s shift from wind turbines to various solar photo-voltaic cell power generation due to the continually declining costs of manufacture. I’m probably not alone in starting to wonder if renewable energy stocks – like wind, solar thermal and solar photo-voltaic and other forms of carbon-neutral power generation – will ever become blue chip stocks in the near future.

Even though they are environmentally friendly because they never give off a single gram of carbon dioxide and other greenhouse gases as they generate electricity, renewable energy has always faced an uphill battle against coal fired power plants when it comes to the financial side of things. But with the increasing concerns of global warming wrecking havoc to our planet’s fragile climate system, various experts from the financial and power generating field are beginning to wonder if the apparent cheapness of coal as a source of electricity is a mere illusion. It makes no sense to keep on building cheap coal-fired power plants knowing that it could bankrupt a lot of insurance companies 50 to 100 years from now due to climate change catastrophe related pay-outs.

Stop-gap measures of cleaning up the energy production of coal-fired power plants, like carbon capture and sequestration are still “trapped” in the experimental phase due to every government’s foot-dragging when it comes to legislating environmentally equitable tax on excess greenhouse gas emissions. Polluters are not taxed high enough to start installing systems that remove excess carbon dioxide from their coal-fired power plants to be stored where they don’t cause global warming. Coal and other fossil fuel lobbyists on Capitol Hill may still have the upper hand for now. But if the global warming situation gets worse – i.e. when climate change refugees that number over a hundred million, other 190 countries around the world threatening the US will an all-out nuclear strike if it doesn’t clean up its act. The fat cats at Wall Street might find it more economically viable to start issuing blue chip renewable energy stocks within the next 5 years than to face the wrath of growing geopolitical pressure 50 to 100 years from now. Change must start somewhere you know.

Renewable energy related blue chip stocks will probably first gain popularity in the United States after President Obama announced that he will create "green jobs" in the US that cannot be outsourced. Unfortunately, President Obama faces an uphill battle against seasoned Capitol Hill crude oil / coal / fossil fuel lobbyists for renewable energy blue chip stocks to become an economically viable trading tool anytime soon.

As the prerequisite for every existing blue chip stock is public confidence and stability, it seems that as of late renewable energy schemes are being shot down by powerful Capitol Hill – and in every major Western industrialized country - lobbyists with fossil fuel interest who are unwilling to relinquish their hold on the energy market. Add to the that the public’s lingering doubt over slickly commercialized green power generating technologies because of the green washing issue; especially when it comes to energy firms that are founded on the fossil fuel boom of the 20th Century pretending to prop-up some semblance of corporate social responsibility by supposedly being environmentally responsible despite of evidence proving the contrary. And there is also the lack of political will to legislate a tax system on excess greenhouse gas emissions that is more equitable to the environment and is congruent to the laws of physics. Blue chip renewable energy stocks thus still face an uphill battle before it can replace crude oil stocks.

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