Alphabet’s
GOOGL
subsidiary Google has put a Doodle to mark Earth Day 2022 on Apr 22. This tech giant marks special occasions with doodles by tweaking or changing its well-recognized Google logo with a suitable animation or creative image.
Google has highlighted a very sensitive subject on an appropriate day by including four time-lapse GIFs in the Earth Day Google doodle. The doodle highlights the glacial retreat at the peak of Tanzania’s Mount Kilimanjaro, the glacial melt in Sermersooq in Greenland, coral bleaching on Lizard Island in Great Barrier Reef in Australia, and devastated forests from bark beetle infestation due to increasing temperatures and severe drought in Germany’s Harz Forests by using satellite imagery and photographs over several years.
From the perspective of the investment world, the attempts to highlight climate change concerns can bring increased attention to clean energy funds that can gain from rising initiatives to control adverse climate changes. In this regard, market participants can consider funds like
iShares Global Clean Energy ETF
(ICLN),
Invesco Solar ETF
(
TAN),
First Trust NASDAQ Clean Edge Green Energy Index Fund
(QCLN),
ALPS Clean Energy ETF
(
ACES) and
Invesco Global Clean Energy ETF
(PBD).
There is rising awareness regarding climate change concerns as the latest reports from government officials highlight the scope of the issue. Going by the United Nations’ climate science panel’s report, greenhouse gas emissions will be mandatorily required to peak before 2025 for lowering global warming to 1.5 degrees Celsius above pre-industrial levels, per a CNBC article.
Furthermore, favorable government policies, impressive renewable investments, falling overall cost of generating renewable electricity and the growing adoption of electric vehicles (EVs) might keep supporting the momentum in the space in 2022.
There’s no denying that U.S. President Joe Biden is seriously considering threats hidden behind climate change and is working toward his pledge to cut emissions in half by 2030. In the recently-released 2023 budget proposal, President Biden has raised around
60% in climate funding over the 2021 fiscal year
. He has proposed to allocate about $45 billion in new funding for climate change, clean energy and environmental justice programs, per a CNBC article.
Meanwhile, the Biden administration had attempted to enhance the federal clean energy investment with the $1.75 trillion House-passed bill, known as Build Back Better Act, which is stuck in Congress.
Moreover, technological advancements, increasing investments, growing government initiatives and rising awareness across the globe about adopting clean energy have been leading to a rise in demand for renewable energy.
Clean Energy ETFs That Can be Great Bets
According to the International Energy Agency (IEA)
report
, renewable energy sources are expected to make up 95% of the world’s increase in power capacity through 2026. Per Allied Market Research, the global renewable energy market is expected to reach a value of $1.51 billion, at a CAGR of 6.1% between 2018 and 2025. Against this backdrop, let’s take a look at some alternative energy ETFs:
iShares Global Clean Energy ETF
ICLN
iShares Global Clean Energy ETF seeks to track the investment results of an index composed of global equities in the clean energy sector. It has 83 holdings. The fund’s AUM is $5.62 billion and the expense ratio is 0.42% (read:
5 ETFs to Invest in Our Earth
).
Invesco Solar ETF
(
TAN
)
Invesco Solar ETF is based on the MAC Global Solar Energy Index, which comprises companies in the solar energy industry. It has 52 holdings. The fund’s AUM is $2.50 billion and the expense ratio is 0.66% (read:
Play “Greenflation” With These Electric Vehicle ETFs
).
First Trust NASDAQ Clean Edge Green Energy Index Fund
QCLN
First Trust NASDAQ Clean Edge Green Energy Index Fund seeks investment results that generally correspond to the price and yield, before fees and expenses, of the NASDAQ Clean Edge Green Energy Index. It has 65 holdings. The fund’s AUM is $2.19 billion, while the expense ratio is 0.60%.
ALPS Clean Energy ETF
(
ACES
)
ALPS Clean Energy ETF seeks investment results that correspond (before fees and expenses) generally to the performance of its underlying index, the CIBC Atlas Clean Energy Index. The fund’s AUM is $736.2 million and the expense ratio, 0.55% (read:
5 Best Sector ETFs of March
).
Invesco Global Clean Energy ETF
PBD
Invesco Global Clean Energy ETF is based on the WilderHill New Energy Global Innovation Index. It consists of 140 holdings. The fund’s AUM is $273.2 million and its expense ratio, 0.75%.
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