Categories: Energy Stocks
Topics: Investing in Energy

Positioning for 2024 Gains in the Renewable Energy Sector

Yes, the clean energy transition has been around ever since the 1970s oil crisis. But… and let me be crystal clear… 2024 is THE YEAR that all investors should be positioning for escalating gains in the clean energy space.  

Trillions upon trillions of dollars are set to flow into unthinkably large green energy projects, both here at home and globally, as fossil fuels are eventually phased out to the benefit of our planet. 

And while this year’s COP28 climate summit in Dubai kicked off rather inauspiciously… presided over by none other than the chair of Abu Dhabi National Oil Company… the conference did manage to hit a number of high notes — including, on day one, a pledge of at least $420M for areas suffering the worst effects of global warming — culminating in a landmark agreement among 200 nations to transition away from fossil fuels.

The agreement is being lauded by governments and climate scientists alike as a “turning point” in the global climate fight. US Special Envoy John Kerry, stated, “I am in awe of the spirit of cooperation that has brought everybody together. This document sends very strong messages to the world.”

United Nations Secretary-General Antonio Guterres added, “For the first time, the outcome recognizes the need to transition away from fossil fuels. The era of fossil fuels must end, and it must end with justice and equity.” 

The framework sets in motion a transition to get the world to net zero greenhouse gas emissions by 2050, and a carbon pollution peak by 2025, and also provides some wiggle room to individual nations like China — by far, the world’s #1 polluter — to peak later.

Naturally, with all of the half measures and loopholes that come with an agreement of this magnitude, it will be the actions and not the words or pledges of the worst offending nations and corporations that will ultimately determine if this is a turning point that truly marks the beginning of the end of the fossil fuel era.

To me, the proper way to view it, particularly from an investment perspective, is that perfection should not be the enemy of progress… and we are certainly seeing a lot of progress in the global green energy push. 

As just one example, India, the world’s #3 biggest polluter behind only China and the United States, is building one of the largest renewable energy projects the world has ever seen. Called the Khavda Renewable Energy Park, the $2.26B solar and wind energy project, which is being constructed in the Indian salt desert bordering Pakistan, will be so big (around 280 sq mi) that it will be visible from space. 

Along those same lines, the United States and China have jointly pledged to support efforts to “triple renewable energy capacity globally by 2030,” with initiatives being deployed to meaningfully reduce emissions, including methane (which has more than 80X the warming effect of carbon dioxide), from their respective power sectors within the current decade.

Adding substance to that pledge, in September, America’s largest-ever renewable energy infrastructure project broke ground in New Mexico. The SunZia transmission line, which is expected to come online in 2026, will stretch about 550 miles from central New Mexico, funneling electricity from massive wind farms to metro areas in Arizona and California. 

In China, President Xi has announced a 400GW wind and solar park to be constructed in China’s sprawling desert, which, once completed, will be the biggest renewable energy project in human history. The park is expected to produce nearly twice the amount of renewable energy capacity of the entire US and nearly match the total installed renewable capacity of all of Europe. 

Those are just a few examples of the level of investment that’s presently going into the global green energy push. Bloomberg New Energy Finance goes a step further, stating, “Annual green investments will need to nearly triple to $6.9 trillion by 2030 if we are to have any hope of hitting net zero by 2050.”

Taken altogether, it makes select clean energy stocks a timely investment opportunity heading into 2024 as it offers exposure to a rapidly growing industry valued in the trillions of dollars.

Stay tuned as we prepare the release of our exclusive groundbreaking report on clean energy investing in 2024. It’s being penned by our own Nick Hodge of Foundational Profits and includes his Top-4 Picks from the space. 

You’re in the right place to receive it. In the meantime, you can tour Nick’s Foundational Profits newsletter here.

Yours in profits,

Mike Fagan
Editor, Daily Profit Cycle