Green ETFs Struggle, Thanks To Fall In Oil

Ted

FYI: The environment is in the spotlight, with the Paris climate talks in full swing. But investors in “green” exchange-traded funds have learned from experience that these funds have yet to establish a long-term footing.

There are all sorts of ETFs in this sector. Some focus on individual green technologies or market segments, while others take a broader view. As a group, however, they have mainly had a tough year. So far in 2015, through Nov. 30, some in the group were trading 15% to 22% lower.
Regards,
Ted
http://www.wsj.com/articles/green-etfs-struggle-thanks-to-fall-in-oil-price-1449460370

LewisBraham

A rather dumb story as the cost of electrical generation--the primary use for solar and wind power--has almost nothing to do with the price of oil. Natural gas and coal are the primary competitors in this sphere as they are used extensively to generate electricity while oil isn't. Also, highly relevant are the politics of green energy subsidies and utility price increases and the age and cost to maintain the existing electrical grid. American utilities have been raising the price of electricity in recent years even though there has been a dramatic decline in natural gas and coal prices. The reason is one there are high expenses to maintain our aging electrical grids. But also simply because utilities can raise prices. They negotiate a price increase with the local governments and then charge it regardless often where commodities trade. If commodities trade cheaply, that just means more profit for the utilities that pass along the price increase. Also, of course extremely important is the situation in China with major suppliers and now consumers of alt energy there. And of course there is the technological advancement in the alternative energy space--these are the primary factors, not the price of oil. This table provides all you need to know about how relevant oil is to electrical generation: data.worldbank.org/indicator/EG.ELC.PETR.ZS In the U.S. only 0.8% of electricity generated comes from oil. I suppose if the entire world were Jamaica or Lebanon, where oil is a primary electricity source, this story would be more relevant.