Renewables Now Make Up 30% of Global Electricity
Hi, !
I hope you had a fantastic weekend! As we emerge from our winter hibernation and start to see the bloom of renewed life, it gets me thinking about how the way we invest can impact the earth. My son and I started watching a new documentary on Patagonia, which covers fascinating conservation ideas they’re implementing there—definitely worth checking out!
An article caught my attention last week discussing renewable energy. Since 2000, wind and solar energy have grown from just 0.2% to 13.4% of global electricity. Overall, renewables now make up over 30% of global electricity for the first time in history. This year, energy derived from fossil fuels is expected to decline for the first time ever.
As we prepare for another summer with uncertainty looming after last year’s historic wildfire season, I think about what resources we have to make a difference. For many years, investing in sustainable products made you feel good but often resulted in lower returns.
With a focus on ESG (Environmental, Social, Governance) practices, we are finally seeing investments that focus on these criteria matching or exceeding the results of their less conscientious peers. More emphasis is being placed on ESG investing not just as a feel-good idea, but as a way to ensure long-term growth.
There have been many issues around ESG investing, with a lack of transparency and reporting being significant limitations. This is starting to change with the development of reporting systems and universally accepted criteria. Several investment firms have created mutual funds or ETFs that excel at using these criteria to build full portfolios or complement existing ones.
Many high net worth investors, pension funds, and endowments are moving in this direction. BlackRock estimates that this clientele typically allocates over a quarter of their portfolio to sustainable investing, with 65% planning to increase their allocation over the next 12 months.
Whether you are someone who spends much of your spare time on environmental crusades, or you only care that your investments make you money, you can now make investment choices that feel good and earn you a healthy return.
Until next week, Happy Investing!
Trevor
In Lighter News:
I’m pretty sure that every day of the year has at least one or two special observances, with some being very specific. For example, today is National Grape Popsicle Day in the US. Unfortunately, not a holiday that keeps us from work, but one that I do encourage you to take part in!
In The Markets:
Last week, major markets experienced mixed performance driven by various economic factors. In the U.S., the S&P 500 and Nasdaq saw gains due to positive earnings reports from tech giants and optimistic economic data, suggesting resilience in consumer spending. The Dow Jones Industrial Average, however, was relatively flat due to concerns over potential interest rate hikes by the Federal Reserve.
In Europe, markets were volatile as the European Central Bank hinted at possible interest rate increases to combat inflation, which remains stubbornly high. This uncertainty weighed on investor sentiment.
Overall, the global market sentiment was shaped by cautious optimism, balanced by concerns over inflation and potential monetary policy tightening.
