Topic: How To Invest

Q: I understand the general decline in the oil industry is due the coronavirus and other cascading effects that push down crude oil prices. In the past you’ve cautioned against alternative energy investments. But I think wind and solar have a future especially when considering environmental externalities. Aren’t electric vehicles and charging technologies on the upswing along with a growing public demand for a Green economy? How can I profit from these trends?

Article Excerpt

A: How soon oil and gas prices will recover is uncertain. That’s especially so considering one of the main drivers of that decline—the COVID-19 pandemic—remains ongoing. Meantime, low oil prices (and resulting low gasoline prices) could, in fact, lower demand for new renewable power projects. That’s because it makes them even less price competitive against fossil fuel power generation. At the same time, big upcoming government deficits due to emergency spending could make subsidizing renewable power—not to mention subsidies for electric vehicles—even less appealing to cash-strapped governments. Nonetheless, Brookfield Renewable Power (symbol BEP.UN on Toronto) and Innergex Renewable Energy (symbol INE on Toronto) are two renewable power companies we recommend as buys in our Canadian Wealth Advisor newsletter. We also recommend Algonquin Power & Utilities Corp. (symbol AQN on Toronto). We think all three offer strong long-term growth prospects, as well as high and sustainable current yields. We haven’t found any solar power companies we want to recommend as buys, but the Invesco Solar…

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