Mumbai: Renewable energy resources represent a high risk investment than the fossil fuel source over the investment period that investors care about. Many renewable companies, startups and other allied industries are all suffering massively from investor fear right now.
Most renewable companies just exist to develop and demonstrate a technology, with the aim of selling out to a larger corporation. For example, a biodiesel company would develop its technology to the point where it can build a pilot plant to show it’s process is scalable, then it would sell out to a BP or Dow etc. So you are permanently chasing new investor money until you get to that point, a single hiccup in that process leads to bankruptcy.
To add to this – cheap fossil fuels are super bad for renewable energy alternatives due to economic competition. Bio-crude and Biofuels compete with fossil. They are only competitive at a certain price, and subsidies can only get their price down so far. A low oil price undermines that whole sector.
Dollars tend to flow to the cheapest energy source, and if wind and solar cannot undercut oil and gas, then our energy mix is likely to begin trending in the wrong direction.
By Dr Raaginii Jaain Founder & CEO-Geetanjali Envirotech
