Expensive Wind – Rising Renewable Costs
As many world elections are set to take place in the next few years, renewable energy is going to be a key issue moving forward. The world has already reached the point of no return when it comes to climate change, and steps must be taken to prevent it from becoming worse.
Unfortunately, there has been a major issue with renewable energy: cost. This is especially apparent in offshore wind farm projects, which have taken a major hit as of late. Vattenfall, a Swedish company, called off 1 of their 3 phases of the wind complex they planned to build in the North Sea. This is because expenses rose by as much as 40 percent since they planned to build the complex, making the endeavor too costly. Supply chain issues paired with increasing demand have caused construction expenses to rise rapidly across the world, and this has led to many projects across the world being at risk. What isn’t helping is high interest rates, which is making it more expensive for these projects as loans are not as enticing anymore.
This is increasingly problematic because offshore projects are some of the largest steps the world can take to combat climate change. Cost-effectiveness has always been a problem with the renewable energy industry, but its clear governments need to step in and fix the issues plaguing these markets. After all, there is vast interest in these renewable projects from companies like BP, who are looking for ways to transition to cleaner energy, making it important that this opportunity is seized before it is too late.
Want to learn how to invest? Download the Invstr app, where you can play Fantasy Finance and manage a virtual investment portfolio or open a brokerage account and invest for real. Take our interactive investing course on Invstr Academy and become a better investor today!
I am not a financial advisor and my comments should never be taken as financial advice. Investments come with risk, so always do your research and analysis beforehand.
