Sunday, August 8, 2010

Climate Change Sector - Investment Opportunities.

I know this sounds really vulgar! firstly to publicly acknowledge the fact that we are screwing our planet and secondly to have Investmen Opportunities trying to reverse it!
However the recent Hot Investing Topic is that of Investing into the the Climate Change Sector for abnormal alpha!!

What is Climate Change Sector Investing ?

Investing into one of the following three sectors is what the modern economists refer to as Climate Change Sector Investments Energy Efficency, Clean Energy and Agribusiness.

Energy Efficency is using less energy to provide intutively the same level of energy service. For example, insulating a home allows a building to use less heating and cooling energy to achieve and maintain a warm temperature inside home during cold winters, or say installing fluorescent lights and/or skylights instead of incandescent lights to attain the same level of illumination.( btw Compact fluorescent lights uses just about 20% energy and lasts almost 10 times longer than incandescent light bulbs so next time do buy OSRAM Lights(I dont get paid for commercials on my Blog).
Efficient energy use is all about achievieng more efficient technology or processes rather than by changes in our individual decadent behaviour of screwing nature, at which we all are bettering year by year!

Clean Energy

Yours truly passed out in 1996 as a Chemical & Electrochemical Engineer, and found it more sexy to take a career that involved numbers which meant money!so this write up on Clean energy could be the most biased pitch that i have ever made!

Clean Energy obviously has been corrupted (i like it though) by Green piece(correct spelling) activists as Sustainable Energy, which energy is the provision(one cannot create from zero ! remember fundamental laws of Energy! Energy cant be created nor destroyed only converted! sounds more like the scientologist pitch but anyways) of
energy such that it meets immediate needs without a trade off to the future generations needs.

Sustainable energy sources are most often regarded as including all renewable sources, such as Electro Chemical,Bio, solar power, wind power, wave power, geothermal power and tidal power.( It can also includes technologies that improve energy efficiency, inspite of the fact that my father in law retired from a Nuclear plant in Kalpakkam I am not including Fission
power here).

Agri Business

In agriculture, agribusiness is a generic term for the various businesses involved in food production, including farming and contract farming, seed supply, agro chemicals, farm machinery, wholesale and distribution, processing, marketing, and retail sales. The term has two distinctly different connotations depending on context.

Investing into any of these three above sectors is reffered to as Investing into the Climate Change Sector.
As of now needless to say there is tremandous opportunity in this however the fact is that there are not many reliable financial products or benchmarks availible for investors who are invested or intend to invest into this.

Muthukumarn Mani at the World Bank Blog talks about a very interesting technology linked investment opportunity on climate change sector , sounds good but to be honest would work only if one of those money making machines from wall street can really productize this and pimp it to investors.


Cheers
Venkat

PS: Be sure you can expect more on this topic from me.

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