Doubting Renewable Energy
by Jeff Siegel, Green Chip Stocks 
on 11.29.08
Last week I spoke to a small group of investors about renewable energy, and the potential we see for certain renewable energy stocks in 2009. Now I don't typically do a lot of these types of meetings. Maybe four or five a year. To be honest, I'd rather these folks just read my weekly updates. This way, I don't have to jack up my carbon footprint by flying all over the country. However, for investors that are new to this sector, certainly it helps when you can ask direct questions and get direct answers.
Now over the years, I've come to expect two things from these types of meetings: A genuine interest in renewable energy investing, and the always-present disruption from some guy who thinks global warming is some kind of liberal trick or that more coal and more drilling makes more sense then building out a large-scale sustainable, renewable energy infrastructure.
So it was really no surprise when, during my most recent meeting, the first question I received was from a gentleman who wanted to know why I would be so bullish on solar when there was no way it could ever generate more than just one or two percent of our overall power needs. Instinctively, I pointed to the NREL study which indicated that enough electric power for the entire country could be generated by covering 9 percent of Nevada with parabolic trough systems. This is a plot of land roughly 100 miles on each side. His eyes rolled, and a snicker followed.
Despite the overwhelming amount of objective, peer-reviewed data that essentially spells out the potential of renewable energy, some investors just don't want to be convinced. And that's fine. But it is a bit mind-boggling. After all, here we are today with an enormous opportunity to invest in something that's going to change the entire landscape of the world. Yet some just choose to remain stubborn, continuing to doubt the validity of renewable energy – just like those before us who doubted many of the things we take for granted today. Take a look:
“This 'telephone' has too many shortcomings to be seriously considered as a practical form of communication. The device is inherently of no value to us” - Western Union internal memo, 1878
“Radio has no future” - Lord Kelvin, British mathematician and physicist, 1897
“Airplanes are interesting toys but of no military value” - Marshal Ferdinand Foch, French military strategist, 1911
“There is no reason for any individual to have a computer in their home” - Kenneth Olsen, president and founder of Digital Equipment Corporation, 1977
Of course my favorite comes from the president of the Michigan Savings Bank who told Henry Ford's lawyer, Horace Rackham, “The horse is here to stay, but the automobile is only a novelty – a fad.”
Fortunately, Rackham didn't listen, and invested $5,000 in Ford stock. He later sold it for $12.5 million.
As Green Chip investors, we have chosen not to accept the premise that renewable energy is merely a novelty or fad. Instead, we are embracing what we believe is an industry that will offer the greatest investment opportunity of the twenty-first century.
Certainly there will be those who disagree. But we can't waste our time on those who refuse to look to the future while muddling around in the past. This is too big. The renewable energy revolution is not only upon us...it's actually being strategized right now by the President-elect. The final straw, my friends, was the U.S. And after eight long years of fiscal irresponsibility and failed energy policies, we're now about to move this country, and the world forward.
To a new way of life, and a new generation of wealth...
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"To a new way of life, and a new generation of wealth..."
And cheers to that!
There is no reason for any individual to have a computer in their home.. nice point
What, exactly, is it that these people doubt? That sunlight is a form of energy? That we've measured how much energy is in sunlight? That PV and solar thermal can convert light to electricity? What, precisely, is the problem here?
I'm sorry, maybe scientists are more used to being convinced by facts alone, but I just can't understand what someone could disbelieve when it comes to renewable power.
For those not paying attention, if each of the above listed inventions HADN'T become the viable things that they are today, we WOULDN'T BE IN THIS MESS!!!!
The telephone was the end of true meaningful communication between two living beings.
Radio has helped to aid military maneuvers.
Airplanes have polluted our skies, and killed our brothers and sisters of the world with the bombs they carry.
Computers have helped to make criminals of (piracy) of good people, and wasted peoples' time more so than even television was able to (arguably).
Don't think I even need to tell the ills of the automobile.
The sad thing is, that I doubt that most people would be able to draw the same conclusions. Most would just say, "Wow, I can't IMAGINE a world without all those great things. I wouldn't be able to hop onto a jet and be across the world in half a day, jump in my rental car, hooking up my Ipod to the radio and letting the tunes jam, and at night calling home to check in with my loved ones to let them know that I am safe in "insert foreign country."
What we need is LESS! I personally am a proponent of alternative energies. Not at the rate of consumption that we currently have though. Most people need to reduce their energy needs by about 90% before we can start talking about truly implementing a wide scale wind or solar power system. Only a change in thinking can save us.
The trouble that we are in today has nothing to do with those inventions. It has to do with greed and short sightedness. Autos are used to transport people to hospitals for car, allow people to visit others. Meaningful communication happens with people sitting right next to each other or people thousands of miles away. The phone did not eliminate something that takes two to do, that is talk. People living under the same roof don't talk to other meaningfully for a variety of reasons. It is the intellect that breaks through that. While all the inventions named above have been used in military uses, that does not mean anything as humans are a warring species. We fight, radio, plane or no radio plane. Since the dawn of humans there has always been fighting. Blaming the tech obfuscates the true issues. Those issues being that humans are greedy and self serving.
Magic Solar Energy Beans to the rescue!
http://tinyurl.com/56ylqc
That will show those doubters!
Synergy: True, people are the main problem. The root cause if you will.
However, without the above listed inventions it would have been impossible to have travesties such as world wars. Regardless of the content, face to face communication cannot be replicated even with the most advanced t.v. conference phones. Like I said before, piracy was born thanks to the internet. How many people do you know that regularly shoplift? Not many would be my guess. Change the question to how many people you know that download copyrighted content. The effect is the same. You are stealing something which isn't yours to take. One would be possible in any society regardless of technology. Software, music, and movie piracy is made possible, on a wide scale, due to the internet. Yes, I do know that people used black boxes to steal cable t.v. before PCs became ubiquitous.
I stand firm that certain technologies bring out the worst in us. As you say, humans are to blame, but we could prevent a lot of our problems by having progressive intellectual discussion on new technologies before allowing the masses to adopt them.
So Sirerdrick, when would you have stopped the technological advancement of society? sure you wouldn't have tolerated the industrial revolution, with all the pollution from coal, so maybe you would have loved to live in the medieval ages, but wait, there where a lot of wars at that time, and plagues and famines, and people lived until their 40s on average. I am sure you wouldn't like the roman empire either, which destroyed a lot of forests and polluted regions with lead. Yeah, you are right, we shouldn't really have come down from those trees.
Alternative energy is a sure thing the same way that dot-coms were a sure thing in 1999. Some will survive and develop businesses that make money, maybe even lots of money.. Many will go belly-up.
The art of investing is said to be the art of avoiding losing money as much as it is the art of making money. It is foolish to treat doubts like apostasy. Instead, use them as checks and balances against the possibility that one's own thinking is not always perfect.
Hold on a minute - you were advising about stocks doing well in 2009? I'm no economist, but I think any armchair financially savvy Bloomberg-reading American would tell you that 2009 will see the stock market with the craziest swings and volatility the world has ever seen. You'll only make money on stocks if you happen to get either insanely once-in-a-lifetime lucky, or are shorting just about everything.
As an investor, I wouldn't put my money into any green stock until I see massive green infrastructure starts the size of the Hoover Dam, the national highway system, and then some. Otherwise, its all wishful thinking. IT WILL NOT HAPPEN WITHOUT GOVERNMENT SUBSIDIES, the size of which we have never seen. Even if we could build on 9% of Nevada, everyone knows transmission is the largest hurtle, and that nut has not been cracked yet. We will basically need to rebuild the ENTIRE transmission of wires across the country - something that previously took most of 100 years to roll out the first time.
That's the argument for natural gas, because the new transmission lines will take 20 years to come on line in a meaningful way. So an investment better be proceeded by massive government action, or renewable energy will remain small beans, by any investor's measure.
@dan123
Hey Dan, trust me, renewable energy will be a major thing soon... that and nuclear energy... We don't really have too many options and places to go right now... we have screwed the planet over and now have to start getting it back to the way it was before the Industrial revolution again...
The governments won't have any options other than starting up nuclear and renewable energy plants..
While we're sharing quotes...
"The stone age didn't end because we ran out of stones." -former Saudi Oil Minister Sheikh Yamani in 1973
The biggest problem with renewable energy is the lack of storage of energy and how to determine who gets browned out during the times when creation of energy has been reduced due to lack of wind or lack of sun. (or tides, etc)
Renewable Energy - any renewable energy has to provide as much energy as it is replacing. In other words a gallon of Ethanol has to have as many BTU's as does gasoline, which it does not, it is far short. Octane is not energy BTU's are. Any business that can not survive with out government subsudities include agriculture is a phony industry.
All you need to do next time someone rolls their eyes and snickers like that --- invite them to take the podium in your place and present their evidence and research that shows it won't work...
I was slightly disbelieving as well but with a quick bit of maths...
250 million people
using an (idealised, after some strong efficiency-making) 2200 watts average over 24h, 365d/yr
100x100 miles
or 160.93 x 160.93 km
or 160,930 x 160,930m
= 21.2 watts per square metre generation needed.
Or if you reckon on getting maybe 8 hours of usable generation per day on average in nevada throughout the year, and having suitable storage systems (an exercise best left to the reader right now, I know), 63.7w/sqm. Which is on the high side of attainable, but IS attainable.
I'm sold. Let's go to Nevada. Get the scientists working on the tube technology, I mean, storage and distribution systems immediately.
All you need to do next time someone rolls their eyes and snickers like that --- invite them to take the podium in your place and present their evidence and research that shows it won't work...
I was slightly disbelieving as well but with a quick bit of maths...
250 million people
using an (idealised, after some strong efficiency-making) 2200 watts average over 24h, 365d/yr
100x100 miles
or 160.93 x 160.93 km
or 160,930 x 160,930m
= 21.2 watts per square metre generation needed.
Or if you reckon on getting maybe 8 hours of usable generation per day on average in nevada throughout the year, and having suitable storage systems (an exercise best left to the reader right now, I know), 63.7w/sqm. Which is on the high side of attainable, but IS attainable.
I'm sold. Let's go to Nevada. Get the scientists working on the tube technology, I mean, storage and distribution systems immediately.