Making a buck from the environment (in a good way)...

People have been making a profit from the environment for centuries. Unfortunately, the environment has gotten the short end of the stick as (some) people pocket the cash and the environment is left severely degraded. This is not news to anyone.

But for those of you thinking a nice, long-term investment might be in order in the next few years, consider something I've been wheeling around my head for a little while. Consider investing in renewable energy.

The trend is a simple one. As climate change draws ever closer to the forefront of people's minds, the realization that unsustainable energy sources can not keep the world going will come to fruition. This, along with the fact that oil resources will eventually (if they have not already) begin to dwindle, will create significant demand for renewable energy resources. Technologies like wind, solar, geothermal, hydro, biomass and tidal will become very popular.

What is very important to realize is that we have not reached this point yet. In fact, we're not even close. Despite all the talk and news coverage about renewable energy, we're not about the hit the point where we can shut down the world's oil refineries. The likelihood that such a point will come within my lifetime (judge your estimated lifetime accordingly) is far greater. The David Suzuki fantasy of self-sufficient everythings could very well be a reality.

But it won't happen tomorrow. It won't happen next year. And when it does happen, it won't happen overnight. The transition to a clean energy world will take decades. That is why those of us in the younger generations might stand to make a killing from it.

Imagine a time when the world's biggest renewable energy firms (ex. Vestas in Denmark or First Solar in the USA) replace the world's big oil firms as the leading energy companies. While they might not be quite as profitable -- you can't own the wind the same way you can unrefined petroleum -- they might still be massive. Imagine when Vestas wind turbines are scattered throughout the world as plentifully as barrels of good ol' Exxon-Mobil crude.

This will happen. We just don't know when. As young people, several of us have the benefit of time. While a significant investment into a specific company or industry might not necessarily pay huge amounts in the short term, the long term growth of renewables will be tremendous. The shares you pay for today might be worth a whole lot more in the years to come.

Indeed, some people have invested a lot of money in the renewables industry hoping that the current 'boom' will pay off huge. But as we have seen, this is not necessarily the case. The economic or political climate has not yet reached the point where renewables can be seen as anything more than 'alternative'. Those looking for a quick buck might not find it here. But those looking to make a secure, long-term investment probably will make a nice chunk of change.

In terms of where to actually invest that money, I don't know. I'm not a financial planner. My guess would be the big companies like Vestas and First Solar, but renewables are still in their infancy and other, much smaller companies could very well grow much larger. Other options would include Index-funds, which would invest in an entire sector, such as solar, wind or even 'clean tech' to cover every renewable company around.

You won't make lots of money right away. But you might very well set yourself up nicely in the future. And hey, you probably won't hurt the environment all that much, either.