It’s been one month since the United Nations released its climate change report.
In that report, the U.N. asserts that human activities are “unequivocally” causing climate change and that within 20 years the average global temperature is likely to reach or cross the “warming threshold” 2.7 degrees Fahrenheit higher than today’s average.
The United Nations warns:
“The alarm bells are deafening, and the evidence is irrefutable: greenhouse‑gas emissions from fossil-fuel burning and deforestation are choking our planet and putting billions of people at immediate risk. Global heating is affecting every region on Earth, with many of the changes becoming irreversible.”
While I’ve been researching renewable energy profit opportunities for several years, the U.N. report caused me to redouble my efforts — not because the U.N. report is automatically correct in every detail, but because it reflects the global perspective toward climate change. And that’s a perspective that will inspire trillions of dollars of new investment in renewable energy technologies.
Just this morning, for example, President Joe Biden’s administration announced that it will declare a goal to produce nearly 50% of the nation’s electricity via solar energy by 2050.
Green energy isn’t a novel idea. Indeed, being “green” has become trendy over the years, with the symbolic environmental color becoming a de rigueur fashion statement, both on Main Street and on Wall Street.
Some folks display their “greenness” by toting reusable shopping bags to Whole Foods and loading them up with organic vegetables and vegan snacks. Others scorn gas-guzzling Cadillac Escalades and instead bop around town in a sexy Tesla (NASDAQ:TSLA) Model X.
We’ve come to that socioeconomic moment when both consumers and investors are jockeying to “out-green” one another. But at the same time, many of us turn a blind eye to the less-than-green facets of many “green” products or services.
Truthfully, many hyper-green consumers and investors only believe what they want to believe about “green” products. But the fact of the matter is that many green products aren’t as environmentally friendly as advertised.
This inconvenient truth hasn’t attracted widespread attention yet — but it will. And this truth will matter in ways that produce significant commercial impacts in the renewable energy marketplace… and significant opportunities for investors.
So, today, let’s place so-called green energy under a microscope.
And later, I’ll tell you a little about one of my favorite picks in this space — and how you can hop on the “greener train” for yourself.
Dirty Clean Energy
When it comes to being green, most of us focus on the finished product without paying much attention to the non-green processes that delivered that product to our door… or to the non-green aspects of using that product day-to-day… or to the non-green aspects of that product’s end-of-use disposal.
But any honest evaluation of environmental impacts must include every facet of a product’s life cycle — from the pre-production phase to the disposal phase.
For example, on any environmental scorecard, both solar and wind energy would rank higher than coal-fired power. But at the same time, neither of these renewable technologies can boast an unblemished environmental profile.
On the plus side, solar panels generate a lot more energy over their lifetimes than the amount of energy used to manufacture them. In general, solar panels achieve this environmental breakeven point (EPBT) in less than two years.
Wind turbines score even better on this metric — breaking even in less than one year.
Despite the positives, however, solar power can cause serious environmental negatives. Disposing of old panels is probably the biggest one.
In theory, 96% of solar photovoltaic (PV) materials could be recycled and reused in new solar panels. But in reality, 0% of solar PV materials can be recycled profitably.
By most estimates, every dollar spent recycling a PV solar panel yields about 10 cents worth of recovered metal and glass. These poor economics explain why most U.S. solar panels end up in landfills.
This poses serious environmental risks because of the toxic chemicals the panels contain. After a solar panel spends just a few months in a landfill, the toxic lead and cadmium it contains can leach into the soil and groundwater.
Obviously, that’s not an ideal outcome.
Wind turbines produce a similar environmental blight. Most of them end up in a landfill.
So, clearly, disposing of either wind turbines or solar panels is a significant problem. That said, neither one produces an ounce of carbon emissions while operating, which is reason enough to boost their efficiency by combining them with energy storage capability.
The more that wind and solar installations can store their power for later use, the more efficient they become… and the smaller their “whole life” environmental impact per unit of energy produced.
However, not all energy storage technologies are equally green.
Lithium-ion batteries, for example, produce a range of environmental negatives.
- They require metals that come from energy-intensive and sometimes dirty mining operations.
- Like an EV, a lithium-ion battery is only as green as the power grid that charges it. So wherever coal-fired power dominates the grid, these batteries are not particularly green.
- Lithium-ion batteries are not easy to recycle.
On average, every dollar spent to recycle a lithium-ion battery yields only about 33 cents worth of reclaimed metal. Because of this “bad math,” about 95% of all lithium-ion batteries end up in landfills.
By contrast, one competing energy storage technology does lend itself to economic recycling.
That technology is called a vanadium redox flow battery (VFRB).
Unlike solid-state lithium-ion batteries, VFRBs are basically water tanks that contain a vanadium electrolyte solution of differing oxidation states. A proton exchange membrane separates the two tanks.
Electrolytes from the tanks flow through a fuel-cell stack, where an ion exchange occurs across a membrane. When this exchange occurs, a reversible electrochemical reaction takes place, allowing electrical energy to be stored and subsequently returned.
Because of their size and weight, VFRBs are not suitable for EVs. But for energy storage applications, they offer a compelling alternative to lithium-ion batteries… especially when one considers their environmental superiority.
Although VFRBs remain relatively unknown, they are attracting a growing worldwide demand.
The Vanadium Play I Have My Eye On
There are a few good “overseas” plays in the vanadium production space… but they’re mostly thinly traded and too volatile for beginning investors.
However, there is a massive vanadium miner in the Americas that I like.
The company focuses on the production of vanadium flake and vanadium powder, and it’s one of the lowest-cost producers of the element in the world.
Because this company produces all of its revenues from vanadium mining, its share price tends to track closely with the vanadium price. A few years ago, that close connection caused its share price to skyrocket more than 1,000% in a little over a year.
But then the vanadium price came crashing back to Earth… and its share price followed. The good news is that the company continues to produce solid profits, even with the current depressed vanadium prices.
The other good news is that the vanadium story is just beginning to attract attention from investors, thanks to its growing role as a “green element.”
Now, green energy is linked to something I’ve come to call the “Technochasm” — the growing divide between two sides of America, charged by the ever-increasing speed, power, and progress of technology.
On either side of the Technochasm lie those who can build more wealth than they ever dreamed… and those who will inevitably fall further and further behind.
Green energy and the technology behind it are huge catalysts of this movement… and now, the recent U.N. climate report and the Biden administration’s brand-new solar energy goals will add even greater momentum to the movement.
I discuss all this in my 2021 Wealth Acceleration Summit — and also reveal the details of this green energy play.
P.S. A new platform could transform every industry and supercharge the digital economy. In this presentation, I give away the name of one of my favorite stocks in that space. Click here for more.
NOTE: On the date of publication, Eric Fry did not own either directly or indirectly any positions in the securities mentioned in this article.
Eric Fry is an award-winning stock picker with numerous “10-bagger” calls — in good markets AND bad. How? By finding potent global megatrends… before they take off. In fact, Eric has recommended 41 different 1,000%+ stock market winners in his career. Plus, he beat 650 of the world’s most famous investors (including Bill Ackman and David Einhorn) in a contest. And today he’s revealing his next potential 1,000% winner for free, right here.