Is it worth investing in alternative energy firms?

jthetrader

Active member
221 8
Is it worth having a small proportion of your portfolio devoted to firms intending to provide energy from geothermal/wind/solar etc power? If so, how does one analyse their fundamentals (lots of companies are promising to be the next energy provider to the world)? Presumably none of them have alternatives to fossil fuels which are presently cheaper than oil/natural gas/coal?

How about purely experimental operations? Companies looking to develop nuclear fusion, for example? It would be one hell of a thing to miss out one if it ever comes to fruition. Assuming these companies do one day develop these alternative ways of generating energy for our consumption and that they are one day able to compete with the current forms of energy we use, will the explosion in their value be overnight or more gradual as they gradually steal market share from oil producers? I would veer toward the latter since it will take them time to implement their new ways of powering things (people will need to go out and buy electric cars, new plants will need to be built etc) and initially they won't be able to price gouge in the way that oil providers currently can, if the new energy providers prices are extortionate people would just revert to using fossil fuels.

So, folks...are you currently invested in any such companies, if so how much (in % of portfolio terms, I'm not rude enough to ask how much in cash terms) and how did you choose which one(s) to invest in?
 

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