Clean Energy Industry Volatile? Risky? “Don’t tell that to institutional investors.”

An article in the Christian Science Monitor caught our eye, as it should anyone in the least bit interested in what’s really happening in the clean energy industry.

Nearly two years after Solyndra’s widely politicized collapse, doubts surround solar and the entire clean-energy industry. Will subsidies survive? Will natural gas put solar out of business? To many investors, the industry seems volatile and risky.

But don’t tell that to institutional investors. As they see it, the risks in clean energy have fallen and the industry now provides near bondlike safety coupled with yields near or even above 10 percent. That may explain why major firms, including Goldman Sachs, Kohlberg Kravis Roberts, Google, Duke Energy, Bank of America, Kleiner Perkins, Morgan Stanley, Credit Suisse, Rabobank, Wells Fargo, Citi, and Berkshire Hathaway, are pouring money into renewable energy, especially solar and wind.

But wait, you say: what ever happened to all the doom and gloom following the demise of one specific company using one specific technology in one specific sub-sector of the clean energy sector? Note our repetition of the word “specific.” That’s intentional, the point being to emphasize that Solyndra was never representative of the solar industry, let alone the entire clean energy sector, as whole. In fact, if anything the demise of Solyndra had more to do with a good thing – sharply lower costs for polysilicon – which have helped make solar power much more affordable to consumers. Thus, the boom in residential and utility-scale solar alike.

Of course, it’s not just solar power; wind technology’s improving fast, and prices are falling there too. What does all this add up to? As the Christian Science Monitor article concludes: “as more people learn about clean energy’s sound fundamentals and robust growth, more individual investors will reap the handsome returns already flowing to major investors like Google and Goldman Sachs.” Consider yourself informed. 🙂


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