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Tuning Out the Static in Copenhagen
Fri, December 11, 2009 2:34:18 PMFrom: Green Chip Review

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Tuning Out the Static in Copenhagen
By Sam Hopkins | Friday, December 11th, 2009
This weekend in Copenhagen, they're thinking about what really matters...

Monday will mark the beginning of the pivotal second week of the United Nations Climate Conference (COP-15), making this prime time for conjecture. What will national leaders promise in the way of greenhouse gas emission reduction, and will they agree on a global carbon pricing system in a final Copenhagen consensus?

Well, as I've weighed the reports from my contacts there at the conference against market observations and other global energy news, I'm happy to say I don't think next week will make or break us as clean energy investors.

Action Outside Copenhagen

The United States doesn't have a price on carbon emissions — pending legislation is angling in that direction — yet this week GE (NYSE:GE) completed a deal to produce turbines for the world's largest wind farm in Oregon. At $1.4 billion, the 845 megawatt GE blockbuster is a shining example of large-scale renewable energy momentum already in full swing. Due north from Oregon in British Columbia, GE is pursuing a smaller, 300 MW project.

Yet on the second day of COP-15, UN Executive Secretary and climate change chief Yvo de Boer pushed for such deals to get done in Copenhagen. "Please please, please, if you are a businessman, do a deal in Copenhagen and please, please, please make it market-based. Because if we fail to get a market-based agreement, we will be forced to turn to tax and regulation," de Boer pleaded.

He might not have known about GE's newest North American projects, but de Boer should be aware that renewable energy has its own momentum that is separate from the climate change issue... That's been our observation at Green Chip Stocks all along.


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Oil price increases alone bring new clean energy technology into the realm of reality with every dollar tick upward. The International Energy Agency just revised its 2010 demand scenario upward, and that's driving oil higher. The main reason is China's economic resilience, which we'll discuss more in a bit...

Oil is certainly a major factor in business success for any company that owns a vehicle, and efficiency rules in today's marketplace.

Getting Down to Green Business

Last Sunday in the New York Times, Guns, Germs and Steel author Jared Diamond asked, "Will Big Business Save the Earth?"

As he illustrated with examples from Coca-Cola, Chevron, and even the bogeyman of many left-leaning causes, Wal-Mart, the business world has its own reasons for going green. In Wal-Mart's case, the decision to reform its logistics chain to save fuel is saving the company and its shareholders $26 million a year. Coca-Cola realized people couldn't have a Coke and a smile if water supplies are too strained and too expensive to get good H2O first.

Diamond pointed out that oil giant Chevron is going super-sustainable with its operations in Papua New Guinea to save itself the pain of local unrest, regulatory wrangling, and simply to provide value to investors who now demand sustainable operations even in the fossil fuel industry.

Renewable energy is a matter of consumer choice, risk mitigation, and plain-ol' competitive advantage in a business world that values "green."

Of course, that doesn't mean that all shades of green look the same. At GCS we bring you info on industrial stalwarts like GE that are becoming titans of new energy, as well as newer companies like Trina Solar (NYSE:TSL), which has gained 416% since the beginning of 2009!

Trina's success as an international solar power player born in China would have been unthinkable a decade ago. China was for low-cost toys and clothing, not industry leading clean energy technology... Can you imagine what publicly-traded green companies could come out of Africa in the next several years?

Billionaire financier George Soros is thinking that way. This week in Copenhagen, Soros proposed using the International Monetary Fund's special drawing rights (SDRs) to set up a "green fund" that would subsidize cleantech in poorer countries. SDRs are a financial instrument (sometimes called a "virtual currency"), that you never really have in your wallet. But SDRs can be turned into real lucre and put into action just like pounds, euros, and dollars.

There in Copenhagen but outside the policy fray, Soros showed the power new thinking by people who know quite a bit about real-world business. Climate change mitigation and moneymaking are not at odds, and indeed the quest for a cleaner global energy mix has already made many entrepreneurs and investors into millionaires.

So when Yvo de Boer threatens taxes and regulation if deals don't get done in Copenhagen, he is voicing his clear preference for private sector leaders like Soros to take the reins from the very treaty negotiators now convened at COP-15.

Not Waiting for 2020

In Germany — where policy and industry have worked in tandem to create a green jobs market several times larger than what we have in America — we're now seeing the second and third phases of a new energy economy's development. In Berlin, Environment Minister Norbert Roettgen is now calling for a dynamic feed-in-tariff (FIT), weaning clean energy companies off a system where the government pays a fixed price for their generation to make solar, wind, etc. competitive with thermal (coal) capacity.

Where would the United States be now if Washington had adopted such a system years ago? As I told you in my reporting from the American Council on Renewable Energy Policy Forum on Capitol Hill, U.S. legislators are moving closer and closer to taking proven policy approaches from Europe; business leaders are thrilled.

This coming week in Copenhagen, expect to hear what the Economist has called "oceans of planet-saving rhetoric." Plenty of it will be static. By listening to more of what's going on and tuning in to what's happening now instead of what presidents promise for 2020 or beyond, we hope to make a profitable clean energy economy real for you in the very near future.

In fact, Green Chip International premium subscribers have been busy taking advantage of global clean energy profits in 2009. To find out more about GCI's direction in 2010 and see why our average closed position gained over 58%, click here:

Green Chip International Special Report

Regards,


Sam Hopkins



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From the Archives...
Copenhagen Climate Conference
2009-12-09 - Emily Rutan

A Climate Change Thought For Everyone To Consider
2009-12-09 - Gregory Kallenberg

Bypassing Congress for Cleantech Profits
2009-12-08 - Nick Hodge

UN Climate Head Wants Market-Based Deals
2009-12-08 - Sam Hopkins

Nearly $1 Billion For Carbon Storage
2009-12-07 - Jeff Siegel



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