‘Oil is power.’  In the past 100 years, this phrase rang true throughout the world.  During World War II’s infamous ‘Battle of the Bulge,’ axis forces made a push to acquire a large allied stockpile of oil.  They failed, which ultimately sealed their fate.  Recent conflict in the middle east has been centered mostly on oil.  Today, countries without oil stores are at the mercy of the countries that do have these stores.  But there is a movement which has been picking up steam during that past few decades – a shift towards finding alternative energy sources.

The building of hydroelectric dams around the country halfway through last century could have started this movement.  Nuclear testing and research could have also contributed to it.  Either way, ‘going green’ is a phrase we hear every day in modern society.  ’Green energy’ is a buzzword everywhere from politics to pop culture, and is sweeping the nation.  Green energy includes:

• wind power
• solar power
• geothermal power
• hydroelectric power
• biofuels

Wind power captures naturally occurring wind to turn a wind turbine.  The revolutions of the wind turbine rotate magnets, which produces an electric current.  Home wind turbines can charge batteries to be used for home appliances.  Large scale wind farms produce large amounts of electricity and can supplement power plant production.  Wind power currently supplies approximately 1.8% of national power production.

Solar power harvests sunlight through the use of photovoltaic cells.  Solar panels are layered with these cells, which turn light into electricity.  The electricity can be used to charge batteries or power household appliances.  Solar power farms harvest light on a large scale, and also supplement power plant production.

Geothermal power utilizes heat that is generated by the earth.  Radioactive decay in the center of our planet produces heat, which is conducted towards the surface.  The heat is lost as it travels outward, so tapping the heat deeper into the earth’s crust is critical.  Geothermal power plants currently supply approximately .3% of national power production.

Hydroelectric power uses the kinetic energy of water to spin power generating turbines.  A dam is constructed on a river, producing a reservoir.  The water flow is regulated through the turbine based on the energy need.  100% of Paraguay’s power needs are met by the production of the Itaipu dam.  90% of the power produced is exported to Brazil.

Biofuels are an alternative to fossil fuels.  Organic alcohols can be made by fermenting the sugars, starches, and cellulose of fruits, vegetables, and other plants (sugar cane) into alcohol by way of enzyme interactions.  Ethanol is a common additive in gasoline.  This is a renewable source of energy that right now is highly subsidized, but has promising prospects for the future.

These are five of the most common renewable energy sources available.  Other forms that are either still in the developmental phase or have a lower potential are tidal power, wave power, biomass power and anaerobic power.  Renewable energy has a bright future.

Fossil Fuels will eventually run out.  Because these new sources of energy have great promise for meeting future power consumption needs, they become an interesting investment option.  An interested party can invest in a few of these options for home power usage.  Although solar power for homes can be an expensive initial investment, there are many reasons for installing this system.  Advantages of solar energy range from independence from the power grid to lowered monthly utility bills.  Wind turbines can also be installed for home use to supplement power usage.

It might be difficult to build your own hydroelectric power plant or geothermal power plant in your back yard.  So how would you invest in this form of alternative energy?  There are many ways to do this through the stock market, and one was is through buying stocks in alternative energy mutual funds.  These mutual funds can be found from many companies.  What makes these mutual funds attractive is the fact that they are diversified in many different forms of alternative energy.  Because a lot of these forms of energy production are still being developed, there are a lot of associated research and development costs.  The profits from these companies will come down the road.  The mutual fund’s diverse portfolio allows them to absorb these R&D costs with profits from other energy companies within the fund.

If mutual funds aren’t your fancy, alternative energy ETFs are also available.  ETFs are similar to mutual funds in that they represent a diverse portfolio, but without the associated mutual fund fees.  Buying stocks directly from the company of interest is another way to invest in alternative energy.

Fossil fuels are running out.  Although oil is still a representation of world power today, it will not once it’s gone.  Alternative energy sources are the wave of the future.  Knowing which companies are poised for technological advancement is a matter of individual research.  Find the companies that are progressing, or invest in alternative energy mutual funds that capture the entire movement.  Either way, ‘going green’ is the power of the future.