Op-Ed: Green Living, the Next Secular Bull Trend
Economic crisis provides opportunity for change.
I live in the Netherlands, and if there's one thing a Dutch person is always aware of, it's the height and force of the sea. Situated behind dunes, dikes, and levees, the Netherlands is largely below sea level. The city where I live -- Almere -- would be flooded by 4 meters of water if a disaster occurred.
A few weeks ago, an international climate expert, Konrad Steffen of the University of Colorado, warned that the sea level would rise almost twice as fast as predicted. Instead of 2 feet, it will rise more than a yard by the end of the century.
The result of these increased numbers could mean catastrophe for countries like the Netherlands, Indonesia, and Bangladesh, and cities like Venice, Italy; New Orleans; and San Francisco. And there's no real dispute among scientists about the cause of this: global warming.
As alarming as this may seem for my countrymen and myself, in reality, it doesn't change our attitudes or behavior. Everybody drives to work, leaves electrical gadgets on 24 hours a day, and flies all over the world for business and pleasure. TVs and refrigerators become bigger and less energy-efficient. And everybody has a ton of gadgets -- all operating on batteries -- that nobody really needs. Strange, isn't it?
The consumption of electricity per household in the Netherlands increased quite dramatically over the last 20 years (more than 15%), although almost all electrical machines and light sources became more energy-efficient. To soothe their conscience, people take "green" electricity -- electricity generated from natural sources like the sun, wind, or water -- for their houses, and lease an economical diesel car that runs 35 miles to the gallon.
Yes, it's a crisis now. And due to the crisis, people will probably start to live more responsibly - by not leaving their computer on all night, and by being more careful with electricity and heating, for starters. As another example, the sale of bikes in the Netherlands increased dramatically in the last few years (10-15% per annum) and is also expected to increase over 2008.
But the downside is that oil, natural gas and coal are so cheap now that the direct incentive for discovering new and more environmentally friendly energy sources is almost nonexistent.
Royal Dutch Shell (RDS-B), the Anglo-Dutch oil company, stated a few days ago in their annual report that various "green" projects -- like wind energy, solar energy and the efficient production of hydrogen for clean cars -- were put on hold, as the revenues for these projects wouldn't outweigh their cost. Exxon Mobil (XOM) and BP (BP) are likely to follow.
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