Renewable Energy: An Investment Risk Worth Making?

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Renewable Energy: An Investment Risk Worth Making?

Climate Progress says according to Bloomberg, “Energy investments are projected to double over the next eight years and reach $395 billion per year.” That number is possible compared to $195 billion invested in 2010; in 2011 over $260 billion invested in renewables so it does seem green energy investments are on the rise and worth the investment risk.

ROI Is Also a Plus

Investors generally like to see a 20 to 25 percent return on their investments—with renewable energies, that percentage has gone as high as 11 percent according to MIT Technology Review. Other investors say they realized a ROI of 15 percent depending upon the type of renewable chosen as the investment. And, the investment popularity tree seems is first hydro, then wind, then solar.

Top investors are generally corporations that invest or implement green energy at their plants and office buildings. Then there is the Prudential Capital Group which funded $121 million in financing to an Arizona solar power project in March of 2012, says Forbes. General Electric has invested $1.4 billion in solar energy investments, however, both Prudential and GE looked at these investments as “investing in core infrastructure projects with high gross margins and revenues fixed for 20 to 25 years.” Shares of these companies are a smart choice.

For the average investor, ROI will most likely fall between the 10 to 15 percent mark—not a bad ROI at all and the outlook is good based on the urgency to stop using fossil fuels.

Investing in Our Future Is an Attractive Option

Everyone knows in order to remain sustainable, we must find ways to stop using fossil fuels and concentrate on renewable energies. That means innovative energy companies seek investors and government grants or loans to develop what our planet needs most—renewable options and solutions.

Energy expert Daniel Yergin is a strong proponent of investing in our future and the future must include hydro power, wind and solar solutions. The trick is to skip just donating to a green cause but investing in it instead.

Investors do seem to analyze renewable investments and even if investments are based on the desire for a better planet because to many, that’s a good reason to invest. Bloomberg New Energy Finance (BNEF) agrees the rise in renewable investments will continue in the areas of:

  • Bioenergy – Developing and using more biofuels.
  • Hydro – Using innovative water reuse methods in office buildings, schools and municipalities to protect this valuable resource.
  • Marine – Investing in funding electricity through the power of ocean and sea waves.
  • Solar – Investors are seeing the highest return in solar investments due to tax credits and the change in affordability of solar panels.
  • Wind – Investing in ways to increase both onshore and offshore wind power.

The question of whether investing in renewable energies shouldn’t be: Is it a good idea? The real question is shouldn’t we all be investing in the future of the planet we call home?


Greener Ideal is an independent environmental news and lifestyle publication that has been curating content since 2008 to further the green movement. The views expressed by contributing authors are their own and may not reflect those of Greener Ideal.

  • W Daniel Tate

    The ROI is strictly predicated in government subsidies and hidden future rate increases