Forex

The oilfield of the future is not 200 feet deep below the surface. It is 96 million miles above the ground .

This is not an understatement. High oil prices in the 1970s ended the era of crude oil as a source of electric power and kick-started the wind energy industry in Europe and elsewhere.

Will the current regime of triple-digit crude oil prices begin the era of renewable energy? Conventional sources of energy, including oil and coal, not only have to bear the brunt of higher costs, they are also under attack by the green brigade. These hydrocarbon fuels are blamed for global warming and climate change. And with climate change taking centre-stage in energy concerns across the globe, policymakers and investors are waking up to the potential of green energy — be it with wind, small-hydel, solar, bio-mass or ethanol.

Renewable energy sources like geothermal, solar and wind constitute approximately 2.2% of global energy generation. Internationally, a lot of investment is taking place in green fuels which are renewable and non-polluting. The momentum is the strongest in Europe and the fever is just catching up in India.

Barring wind energy and ethanol, there are few commercially operational projects in this space. This makes it difficult for equipment suppliers to establish scale and thus, bring down costs to competitive levels. With technological development being critical in the industry, these companies need huge funding in the initial years. Consequently, while many companies have forayed into the renewable space, only a handful of them have made it their main business.

We feel that this is a suitable time for investors to start accumulating right stocks in this space. Given the size of the global energy market, the sky is the limit for companies which get it right. We, at ETIG, bring you a bouquet of companies in the green-energy segment. Take your pick.

Wind power

As pointed out earlier, wind power is the largest and most popular among renewal sources right now. Initiated by government subsidies, the growth in wind energy in India has primarily been driven by technological advancement and higher scale of operations.

And as technology improves, wind energy is becoming costcompetitive vis-à-vis conventional sources. In the 1980s, a typical wind turbine generator (WTG) could produce one-tenth of a megawatt ( mw) of electricity; now 5-mw capacity WTGs are commonplace. The industry now plans to move offshore, where wind speed is higher and more consistent.