Want to get rich quick while playing a part in fighting climate change? Then consider investing in green energy sectors that have been minting billionaires faster than any other segment of the energy market in history.
The clean energy sector has been hot over the past few years and is so far showing no signs of letting off steam in the new year, thanks to the powerful ESG and clean energy megatrends.
They say a rising tide lifts all boats; however, not all corners of the clean energy market have been equally bright.
Whereas the EV, solar, and even wave power stocks have been sizzling hot, others like geothermal have been laggards.
Here are the clean energy sectors that have been creating billionaires.
#1 Electric vehicles
Not surprisingly, the EV sector comes out on top, thanks to the exploits of Tesla Inc. (NASDAQ:TSLA) and its eccentric founder, Elon Musk.
Over the past year, Tesla has, incredibly, evolved from a controversial cult stock into the world’s most valuable automaker, making Elon Musk the richest man on earth.
After a torrid 450% run, Tesla has not only become the most valuable automaker boasting a market cap of $810B but also made its founder and current CEO, Elon Musk, the richest man on earth after surpassing Amazon (NASDAQ:AMZN) top boss, Jeff Bezos.
Musk owns a 21% stake in Tesla, with the automaker contributing more than $170 billion to his nearly $200 billion net worth, dwarfing the combined market caps of General Motors (NYSE:GM), Ford Motor Co (NYSE:F), and Fiat Chrysler Automobiles (NYSE:FCAU), the three giant Detroit auto manufacturers.
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The remainder of Musk’s net worth is tied to his private space company SpaceX, whose green credentials are not as impressive considering that his rockets burn fossil fuels when they blast off into space.
Despite the impressive run, Morgan Stanley recently released math on Tesla that teases out $3,000 per share, good for 54% upside to the current price, with the Wall Street sell-side analyst citing massive EV growth runways.
Other billionaires on Bloomberg Green that owe their massive wealth to EVs are:
- Zeng Yuqun, Huang Shilin, Pei Zhenhua and Li Ping--Net worth of $61.6 billion with green net worth clocking in at $60.7 billion. The Chinese executives are majority owners of CATL, the world’s largest maker of EV batteries, that supplies Tesla, Toyota, BMW, and Volvo.
Wang Chuanfu, Lv Xiangyang, Xia Zuoquan--Net worth of $ 33.5 billion with green net worth of$13.4 billion. These three Chinese investors are majority owners at BYD, an electric vehicle company that’s currently converting Shenzhen’s fleet of buses, taxis, and trucks into electric vehicles. Berkshire Hathaway (NYSE:BRK.B) has owned BYD since 2008.
Liu Jincheng-- chairman at Eve Energy, Liu boasts a net worth of $10.9 billion and a similar green net worth. Eve Energy is a supplier to electric vehicle manufacturers such as Daimler, BMW, and Xpeng Inc. (NYSE:XPEV).
Li Bin--founder of Tencent-backed NIO Ltd (NYSE:NIO), by far the largest Chinese EV maker. Li Bin boasts a net and green net worth of $9.1B.
#2 Solar energy
The solar sector has emerged as one of the fastest-growing segments of the clean energy market, with a recent BNEF report revealing that both public and private investments in renewable energy capacity came to $303.5 billion, up 2% on the year, thanks mainly to the biggest-ever build-out of solar projects as well as a $50 billion surge for offshore wind.
In fact, solar energy is expected to become so dominant that 80% of all new electricity generation capacity from 2022-2030 will come from the sector. Related: Russia Is The Biggest Winner In The OPEC+ Deal
Investors recognize this emerging trend, and have bid up solar stocks massively--and made some heavy hitters in the sector very rich.
Li Zhenguo, Li Chunan, Li Xiyan and Zhong Baoshen are majority owners at LONGi Green Energy Technology Co Ltd, the world largest manufacturer of monocrystalline silicon wafers. The four investors boast a green net worth of $16.1 billion.
Longi has just completed the construction of the prestigious duo floating PV plant in Ho Tam Bo and Ho Gia Hoet 1 in Vietnam that will generate 70Mw of solar power at its peak.
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#3 Recycled paper and packaging
Last year, the embattled plastics industry was handed a new lifeline after dozens of plastic bag bans on the verge of taking effect have been put on hold in several states on fears of infections by the SARS-CoV-2 virus from reusable bags.
Facing an existential crisis driven by a wave of bans nationwide, the plastic bag industry has been using the coronavirus crisis to block laws prohibiting single-use plastics. The industry has also received a much-needed shot in the arm after the Trump administration introduced a sweeping relaxation of environmental laws and fines in March that have rendered companies largely exempt from consequences for environmental pollution during the COVID-19 crisis.
It, therefore, comes as a breath of fresh air that a leading maker of recycled paper and packaging is attracting major investments that rival mainstream renewables such as wind and solar.
Anthony Pratt, founder and owner of Georgia-based Pratt Industries, is the 7th richest clean energy billionaire with a clean energy net worth of $9B.
Pratt Industries recycling operations save ~85,000 trees, ~35 million gallons of water and more than 5,000 tons of greenhouse-gas emissions every day.
By Alex Kimani for Oilprice.com
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