Time for Australians to invest in renewable energy
As always, the market will shift suddenly when it does and being exposed to the wrong companies well, just remember you were told.
WAKE UP AUSTRALIA: Seize the low-carbon opportunity Business Spectator -by Paul Gilding 28 Jan 2010 “……………There is no realistic scenario for Carbon Capture and Storage being able to deal with carbon emissions at a time and a price that will prevent renewable energy winning the market for clean energy.
Observe what Tom Friedman calls “Green China”.The market will recognise this inevitability before long and mark down coal and other losing technologies accordingly.
It means energy will get a lot more expensive in the short to medium term to finance the transition, though I suspect it will then fall again a decade or two out as new technologies go to scale.
The countries and companies most exposed to risk in this transition are those who have a high CO2 emissions/value creation ratio. This means for example Australia and the US at .5 kg of CO2 per $ of GDP (2005 PPP) are very exposed compared to say Germany at .3 kg of CO2/$. It means companies that make equipment or products that are inefficient (e.g. US auto companies) are very exposed compared to those that don’t (e.g. Japanese auto companies).
The risk for investors are likewise very clear. As always, the market will shift suddenly when it does and being exposed to the wrong companies well, just remember you were told.
Business Spectator – WAKE UP AUSTRALIA: Seize the low-carbon opportunity – Blog – Paul Gilding
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