At Forbes Green Tech, Mindy Lubber explains that investors are making money - big money - on renewable energy.
When Prudential Capital Group provided $121 million in financing for an Arizona solar power project earlier this year, and General Electric invested $1.4 billion in solar energy projects in 2011, they weren’t speculating in risky, early-stage technology ventures. They were investing in core infrastructure projects with high gross margins and revenues fixed for 20 to 25 years; “power plants with no fuel costs,” according to Bill Green, senior managing director at Macquarie Capital in New York...
How much investment are we talking about in "power plants with no fuel costs?" How about "a record $260 billion worldwide in 2011," with a lot more likely in coming years? What's driving this? Here's part of it:
Clean energy investments in the U.S. will continue to be driven by so-called “Renewable Portfolio Standards” (RPSs) in 29 states and the District of Columbia. RPSs are targets and enforcement mechanisms for attaining a fixed percentage of a state’s total electric power mix from renewable energy. Currently, four percent of the nation’s electricity comes from non-hydroelectric renewables and is expected to double by 2025 as utilities strive to meet increased RPS targets. To meet RPS targets now in place, Macquarie’s Green says several hundred billion dollars of investment in renewable energy generation projects will be required between now and 2030. If RPS standards are increased that amount will go even higher.
Even better, as the Forbes article points out, "As the renewable energy industry scales up, prices will become even more competitive." No wonder why smart investors are pouring money into this sector, and why they will be "making money on renewables" for many years to come.