As fossil fuels become increasingly more expensive in the future as old fields deplete, while unconventional sources become increasingly common as global demand for energy keeps rising, electricity will play a critical role in powering the world. Recent advancements in battery and electric engine technologies as demonstrated in the new Think and Tesla automobiles demonstrate the economic and environmental potential of electric vehicles while not compromising speed or distance. As renewable power becomes cheaper relative to fossil fuels, the demand for electricity will rise at above trend growth. Renewable power from hydro and wind are stable, established, require no fuel and are ultimately cheap. Solar power is still many years away from being economically feasible.
The Tarik.ca Sustainable Renewable Power Index is a market cap weighted index which invests in Canadian companies which derive greater than 50% of their income from wind and hydro installations. The goal of the index is to capitalize on the growing importance of electricity in our energy mix.
Index Constituents (% Weighting)
21.6% – Great Lake Hydro Income Trust
21.3% – Canadian Hydro Developers
14.0% – Algonquin Power Income Trust
10.4% – Macquarie Power & Infrastructure Income Trust
8.7% – Innergex Income Trust
7.9% – Plutonics Power
7.6% – Boralex Power Income Fund
4.0% – Innergex Renewables
2.1% – Earth First Canada
1.6% – Western Wind
0.4% – Synex International Inc.
0.3% – Run of River Hydro Inc.
Index Performance (1 Year) : Click Below to Enlarge
Hi!
I am novice in investments and I would like yo invest in renewables.
Could you tell me if Canadian Sustainable Renewable Power Index™ is traded on the TSX and what is the ticker?
Many thanks,
Raynald Lachance
Hello,
Unfortunately the Tarik.ca Canadian Sustainable Renewable Power Index™ does not trade on the TSX. I created the index as a way to track the performance of renewable power generation companies based in Canada. In the US there are a handful of renewable power ETFs. Unfortunately they mostly focus on companies which manufacture renewable power generation machinery (ie. Wind Turbines and Solar Panels) not companies which actually generate the electricity. This exposes the investor to technology and competition risk, whereas an investor investing in the generation of electricity will experience a lower level of risk much closer to that of a utility company.
The two most diversified renewable power ETFs in the US are:
iShares S&P Global Clean Energy Index Fund (ICLN), which has a balance of power producers and equipment manufacturers from the wind, solar, hydro and geothermal industries.
PowerShares Global Wind Energy Portfolio (PWND), which contains a balance of power producers and equipment manufacturers from the wind power industry with an emphasis on the manufacturers.
Tarik