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Will 2021 Be The Year Of Green Energy Stocks?

Business

Looking back, 2020 will be a thick chapter in the history books. This year will be remembered for all kinds of catastrophes, from public health to economic devastation. But it may also be remembered as the turning point for clean energy and the year that changed the world’s trajectory away from certain catastrophic climate change and toward a cleaner, greener energy landscape.  2020 was the year that showed us that oil is not, in fact infallible, and that peak oil is, in fact, inevitable–and it’s right around the corner if it’s not already happening as we speak. When the pandemic brought the global economy to a screeching halt earlier this year, oil prices dove to historic lows, not just shattering previous rock bottoms, but plunging way past zero, with the West Texas Intermediate crude benchmark ending the day of April 20 at nearly $40 in the negative. And while oil has recovered considerably from that stunning crash, the industry has been shaken to its core and will likely never return to its former glory.

For many world leaders and energy and economics experts around the world, this crash had a significant silver lining. It provided a unique and necessary interruption to business as usual in which the powers that be could finally, at long last, take the necessary steps to phase out fossil fuels and reorient the planet away from certain climate death. The World Economic Forum advocated for a “new energy order” and a “great reset.” International agencies such as the United Nations, the International Energy Agency, and the European Union, are all either drafting or implementing green stimulus plans. And in places where the government has not yet led the charge, such as the United States, the private sector has stepped up: a surprising number of blue chip companies have petitioned the U.S. Congress for a green energy stimulus.

This sea change has not stemmed from environmentalism alone–far from it. Countless studies have shown that it makes financial sense too, and that green energy will be a massive jobs creator around the world going forward. In fact, a lot of the world leaders in renewable energy right now are not in it for environmentalism at all. They’re in it because it’s making them a lot of money. Environmental, Social, and Corporate Governance (ESG) investing is not just a trend–it’s here to stay, and those who resist it are likely to get left behind.

All this is to say that while many other economic sectors languished this year, battered by low demands, lockdowns, and supply chain woes, renewable energy companies have had a very, very good year. In fact, a record year. “The numbers are eye-popping,” wrote CNBC this week. “Enphase Energy is up 594%, while SunPower has advanced 484%. Sunrun is up nearly 400%, while Sunnova has gained 310%.”

And then of course there are electric vehicle companies. Unless you’ve been living under a rock you’ve likely been unable to escape the news of Tesla’s meteoric rise in anticipation of the company’s addition to the S&P 500. The company’s stock value has risen more than 700% over this year, and has created no small number of “Teslanaires” out of its shareholders. “Tesla stock is now worth more than the combined valuations of General Motors, Ford, Fiat Chrysler Automobiles and Toyota,” Yahoo! Finance reported this week. And Tesla didn’t even set the record for EV company stocks this year–I think it’s safe to say that that distinction goes to Nio, which saw a jaw-dropping increase of more than 1,000%.

2020 may go down in history as the year that turned everything around for the energy industry and the environment, but 2021 probably isn’t going to be too shabby either. The United States has just passed the nation’s biggest energy bill in a decade, and it’s betting big on renewables. Renewable energy technology is advancing faster than ever, and the sector is on track to keep getting stronger and stronger.

By Haley Zaremba for Oilprice.com



4 Comments on "Will 2021 Be The Year Of Green Energy Stocks?"

  1. DT on Fri, 1st Jan 2021 12:37 pm 

    “Renewable energy technology is advancing faster than ever” The faster the technology advances the more the fossil fuels burn.

  2. Outcast_Searcher on Sun, 3rd Jan 2021 9:57 am 

    Renewable energy technology is actually advancing (re capability, efficiency, etc) incrementally, same as it ever was.

    Citing a one day anomoly in one oil futures market due to concerns about the way the contract matures is NOT a balanced way to represent what happened to oil prices in 2020.
    Aside from that anomoly, Oil Re Brent and WTI was roughly between $30 and $60 and closed in the ballpark of $50. With reduced demand due to Covid-19, hardly surprising, much LESS earth-shattering.

    Just because a certain sector like EV companies has the stocks going bonkers one year doesn’t imply magical immediate transformation of the car industry. It likely implies more money available to pursue the decades long slog (probably several decades for the third world re infrastructure) to make that transaction to electric passenger light vehicles happen.

    And crude oil needs aren’t going anywhere re things like asphalt and the petrochemical industry for a LONG time.

  3. FamousDrScanlon on Sun, 3rd Jan 2021 11:31 am 

    crude oil ‘wants’ not needs


    Tesla Finally Almost Hit 500,000 Deliveries, Two Years Behind its Promise, for a Global Market Share of… 0.7%

    But Tesla’s market capitalization is higher than the combined total of Toyota, Volkswagen, Daimler, GM, BMW, Honda, Ford, and Fiat-Chrysler. The zoo has gone nuts.

    “Tesla announced today that it finally almost reached 500,000 deliveries in a calendar year, with its 499,550 vehicles delivered globally in 2020, and that it finally hit its target of producing 500,000 vehicles a year – two years behind its promises. Back in May 2016, it had promised in its quarterly report that it would produce 500,000 vehicles in 2018.

    But it didn’t happen in 2018, far from it, and it didn’t happen in 2019 either. It finally happened in 2020. That promise in May 2016, like so many of Tesla’s and CEO Elon Musk’s promises, had caused its shares to surge.

    Every promise Tesla and Musk issue is worth many billions of dollars in the company’s market capitalization, which then allows the company to raise many more billions of dollars by selling more shares. In 2020 alone, it raised $12.3 billion through share sales, on top of the $20 billion or so it had raised since its IPO.

    Never mind that these promises either don’t happen at all, or happen finally years behind the promised date, by which time many more promises were issued that drove the shares even higher, allowing the company to raise many more billions. Musk walks on water, and the SEC is blissfully asleep.

    This 500,000 in deliveries globally is a big number for Tesla. But it’s a minuscule number in the overall global auto market, which in 2020 is estimated at 73 million deliveries. Tesla’s global market share in 2020 has reached a whopping 0.7%.”

    https://wolfstreet.com/2021/01/02/tesla-finally-almost-hit-500000-deliveries-2-years-behind-its-2016-promise-for-a-global-market-share-of-0-7/

    Musk is a clever chimp. Hope pimp

  4. DT on Tue, 5th Jan 2021 1:55 am 

    2008 Tesla rolled out the first production of cars. So now 12 years later, all of those cars are either in someones private car collection/museum or in the process of being stripped for scrap. I point this out because most cars built in modern times have an average of 10 to 15 year life span. EV’s are nothing more than a feel good plan of, look at me I am doing oh sooooo much to save the planet. All things built in our industrial civilization have the same result, not made to last, junk it and buy a new one.

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