How to cash in on the renewable energy boom

Climate change and the need for energy security mean money is pouring into alternative energy sources. Stock prices are rising fast, but this is no bubble.

According to James Lovelock, a founding father of the environmentalist movement, the world currently burns enough fossil fuels every year to generate 27,000 million tons of carbon dioxide (CO2). If you solidified that and piled it up, it would make a mountain nearly one mile high with a base 12 miles in circumference. Given that most scientists think that even a fraction of that amount of CO2 spells disaster for the world's climate, this statistic is horrifying enough, but the real problem, thanks to the pace of global growth, is that every year we create not less, but more CO2.

Consider China, which, with a fifth of the world's population, is undergoing a modern day industrial revolution and developing at a pace and on a scale never before witnessed in human history. It is likely to move 300 million of its population to new cities by 2020, for example that's equivalent to moving the entire population of the EU. All those new city dwellers are soon going to aspire to first-world standards of living they are going to want cars, for example. Right now, there is one car for every eligible driver in the US. In China, there are nine per every thousand eligible drivers. That won't last some estimates suggest that there could be anywhere from 100 to 200 million cars in China by 2020.

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MoneyWeek is written by a team of experienced and award-winning journalists, plus expert columnists. As well as daily digital news and features, MoneyWeek also publishes a weekly magazine, covering investing and personal finance. From share tips, pensions, gold to practical investment tips - we provide a round-up to help you make money and keep it.