The Next President's Alternative Energy Agenda
Feb 4, 2016 7:00 AM PT
Alternative energy has become a real growth engine during the last several years. It seems to bounce up and down, depending on the leadership in the White House. President Obama is a supporter, so growth has been relatively strong in recent years. The big question is, what will happen under a new president?
That is a question every investor and industry worker is asking. We all want to work and invest in a growth sector. Many people have hitched their wagon to the growth engine in the energy space, and that has been a good call.
Will the Growth Engine Slow?
However, worries that things will change and growth will slow are starting to set in. What happens will depend in large part on who we elect as president.
Energy is important, but it is just one of many important factors we must focus on going forward. In general, voters won't focus on one issue, like energy, when there are multiple problems -- like security, economic growth and jobs.
That said, growth in energy, especially alternative energy, will continue. The question is, will it be at the same rapid pace or will it slow? If you are working for or invested in the right companies in the alternative energy space, you likely will continue do well.
Choosing Growth Companies
How do you choose the right growth-oriented companies? That question is easier to ask than to answer.
Alternative energy is an industry driven by innovation, reinvention and politics. The hot companies and new technologies always will capture the attention of the media and industry watchers. That means those companies should be the focus for investors and workers.
The life span of a hot opportunity in the energy space may be short. A company or technology that is new and hot today may give way to the next hot company or technology in the blink of an eye.
That happens in every industry. Consider the mobile phone marketplace. Motorola led the space early on. Then in the 1990s, Nokia and BlackBerry took the No. 1 position, sending Motorola to the basement. In the 2000s, Apple's iPhone and Google's Android OS took the lead, sending Nokia and BlackBerry to join Motorola in the basement.
Things change quickly. Leadership changes quickly. Sometimes leaders stay leaders by creating the next growth wave to ride. Most times they do not -- they ride that wave up and then down again.
Consider the iPhone, which has been under scrutiny for slowing growth. Apple remains a beloved company in the eyes of its customers. However, its growth lately has not been quite up to what analysts predicted, so the stock has been hit and some media outlets have been trashing it.
There are two distinct sectors to balance: the customer and the investor. Sometimes they are on the same growth track, but other times they take different paths.
Expect the same thing to happen in the energy space. Investors can use the lessons they learned from the wireless wars in the energy arena. Choose the right companies and technologies to work for or to bet on with your investment dollars.
Energy Tables Turn Quickly
The hottest energy industry segments are solar, wind, hydro, biomass and geothermal energy. There will be plenty of winners and losers in each. Determining which to bet on is the biggest challenge.
Stay alert -- the tables can turn quickly. That might happen with the change in leadership in Washington. However, even if the new president has an alternative energy focus, the industry's volatile growth will continue. Alternative energy will continue to grow -- it's the pace of growth that is the big unknown.
Be prepared to make a series of strategic moves. Staying alert in the rapidly growing and changing alternative energy space will help you stay on the winning side of the growth curve.