More and more countries, governments, businesses and homeowners are investing in renewable energy solutions and whilst this investment helps to conserve natural resources and reduce emissions which is good for the planet, it also makes economic sense.
At a global level, scientists have acknowledged that climate change, which is being driven by an increase in emissions from burning fossil fuels, contributes to natural disasters. These disasters have a negative impact on the economy.
For governments, renewable energy creates jobs. More people can be employed in the renewable energy sectors than in the traditional fossil fuel sectors. The working conditions are also more favourable. From our side, we would rather be up on a roof enjoying a fantastic view than stuck down a dusty coalmine in the dark.
As we have explored in previous articles, renewable energy is cheaper than other energy options. This is why we are seeing large businesses such as Walmart, Ikea and Apple using solar and wind power to lower energy costs. It also helps enable businesses to be more sustainable and profitable. For example, Google is the largest corporate renewable energy purchaser on the planet as electricity costs are one of the largest components of its operating expenses so having renewable power provides protection against price swings in energy.
For homeowners, investing in solar will save you money. How much money you can save is up to you as everybody’s circumstances are different. There are also alternatives to solar, for example, air source heat pumps can be used for domestic water heating. These pumps work by taking heat from the air and transferring that heat to the water. Although air source heat pump water heaters do require some electricity to run, they are around 2 to 3 times more efficient than conventional electric water heaters and are considered a renewable energy technology.
Since heating water is one of the most expensive energy costs for the home, switching to a renewable energy solution for this is a good first step to save money. On average it is estimated that lights can make up about 5% of electricity costs versus water heating which can be 30%. Unlike the fossil fuel alternatives, renewable energy provides a return on investment. When interest rates are low, like they are at present, it can also deliver a better return on investment than banks. As an example, the fictitious Mr Garcia has €2000 in a bank account which is earning interest of €0.20 per month. However, he is paying €0.15 per kWh for his electricity. If he invests his €2000 in a renewable energy solution, he would only have to save 2 kWh every month to get a better return on investment each month than keeping his money in the bank.
Of course, renewable energy solutions such as a solar water heater or solar PV installation save a lot more than just 2 kWh per month. Also electricity generated from renewable energy sources is cheaper than electricity generated from fossil fuels so these are all reasons why renewable energy makes economic sense.