Think Cleantech Is The Future? An ETF For Long-Term, Sustainable Energy Bulls 

 | Apr 26, 2022 10:32

Increasing awareness about global warming and sky-high energy prices have sparked renewed interest in clean technology (cleantech) stocks.

Experts believe we might be witnessing a long-term structural shift in global energy use. In this environment, companies that support alternative sources present positive long-term potential.

Cleantechs comprise a broad range of sub-sectors, including eco-friendly energy, alternative energy, clean air and water, clean manufacturing, energy storage, and energy efficiency.

According to an International Energy Agency (IEA) :

“To reach net zero emissions by 2050, annual clean energy investment worldwide will need to more than triple by 2030 to around $4 trillion.”

Meanwhile, the Biden administration has put cleantech investments on the . A recent press release by the White House highlights:

“Distributed Energy Resources (DERs) – like rooftop solar, battery storage, heat pumps, and electric vehicles – will cut consumer costs, improve public health, strengthen U.S. energy security, and help meet the President’s goal to reduce emissions 50-52% below 2005 levels in 2030.”

Yet, despite potential long-term tailwinds, many cleantech stocks have been struggling over the last few months. Profit-taking, recent market turmoil, and higher interest rates have meant headwinds in 2022.

For instance, so far this year, the ProShares S&P Kensho Cleantech ETF (NYSE:CTEX) has plummeted almost 24%. Meanwhile, the S&P 500 index has declined around 9.8% since January.