You should own global-warming stocks. Even if you think that global warming is based on bad statistics and unconvincing computer models. Or that it's a plot by the tree huggers and the United Nations to institute some kind of world government.I'm not one of the skeptics. I find the science compelling. Human activities ranging from burning coal for electricity to driving gasoline-fueled vehicles have increased levels of carbon dioxide in the atmosphere. These changes are about to shift the world's climate into a new state that will dramatically alter rainfall patterns, ocean currents, sea levels and the acidity of the world's oceans. And we've got only a relatively small window, maybe as few as 50 years, before these changes to global climate take on an irreversible momentum. I'm not here to argue the science. There are lots of books that do a good job of that. My current favorite is Tim Flannery's
Not Just an Environmental IssueThe deck is stacked at the moment in favor of action on global warming. Even if global warming winds up on the rubbish heap of discredited scientific theories, entities such as the European Union, Japan, China, India and even the U.S. are going to adopt a program that looks a whole lot like one designed to stop global warming because it fits each nation's need to increase its energy security as well.
- Making a 20% reduction, from 1990 levels, in carbon emissions in the European Union by 2020.
- Getting 20% of electricity supply in the European Union from renewable sources by 2020. That's more than a doubling from current targets.
- Constructing a new generation of safer nuclear reactors to keep nuclear power at a 30% share of supply.
- Keeping coal at 30% of electricity supply but ensuring that all new and existing plants include systems for capturing carbon and storing it out of the atmosphere.
- Having biofuels provide 10% of fuel for transportation by 2020, up from 2% now.
Group 1: Saving the WorldThese stocks maximize your long-term potential returns, since they really can play a role in solving the global-warming problem. Wind and solar: These technologies are set to go over the top and into the commercial market. There are several factors putting a breeze at the back of wind technology:
- More cost-efficient turbines have driven down the cost of using the wind to produce electricity by about 50% over the past 15 years.
- The European Union's carbon-trading systems put a price on pollution, making it more costly for utilities to do business the old way.
- Big utilities are able to raise capital at extremely low costs.
- Government funding for global-warming programs will be enough to finance the construction of manufacturing facilities that will remove the current solar-cell bottleneck. It's hard to grow a solar-energy market when no one can get enough raw material to build solar cells.