The Tough Realities of Renewable Energy Businesses

By Craig Shields

I just published an 11-page report called href=”” target=”_blank”>The
Tough Realities of Renewable Energy Businesses

Why Investors and Entrepreneurs are Struggling to Profit in
Clean Energy -
and I offer it freely to anyone wishing to
learn from my experiences as a business consultant in this

In the report, I note that, even though I’m not invited to the
board meetings of General Electric and Siemens (and I’m guessing
you’re not either), we can nonetheless pay attention to the obvious
investment strategies that these giants are in the process of

The first step here is understanding that a major transformation
is in the process of taking place regarding the way in which Wall
Street places a value on companies’ stock. Traditionally, of
course, this has been about earnings-pure and simple. Big earnings
mean big valuations.

Recently, however, it’s become obvious that the earnings
reported by most corporations are derived from unsustainable
business practices that are rapidly depleting natural resources,
and these earnings need to be severely discounted if we are to
understand an individual company’s true value on a long-term

There are a handful of companies that clearly “get this,” of
which GE and IBM are the largest in the US. (Sanyo and Panasonic in
Japan, and ABB and Siemens in Europe are leaders in their
respective geographies.)

Now it’s clear that GE wants to rule the world as the Earth
“goes green” over the coming few decades. As far as I can discern,
there is not a single major green product or service line that GE
is overlooking.

From its Louisville, KY smart appliance plant, in which each
product is fitted with a computer that communicates wirelessly to
and from a programmable controller in the customer’s house, to its
participation in Smart Grid, to its gearbox-less wind turbines,
it’s quite clear what GE is doing as a long-term corporate

So what should smart entrepreneurs infer from this, and what
actions do they take accordingly? Probably many things. But let’s
look at a couple of obvious points:

A) If I were evaluating a business
plan that suggests competing directly in one of these spaces, I’d
be looking askance at the claim that anyone is going to beat GE in
a head-on-head competition. I’d be much more sanguine on a plan
that proposes to offer products or services that are complementary
to the strategies of this behemoth.

B) A company with the vision and
strength of GE is extremely unlikely to make a serious mistake when
it comes to a major market strategy. I personally believe that the
world is headed towards a green tomorrow - and I’m generally right
more often than I’m wrong – but you’re still far better off
trusting a $157 billion company when it comes to making this

The above is an excerpt of one of 10 tips that I provide in the
complete “target=”_blank”>Tough Realities of Renewable Energy Businesses
report. It’s absolutely free; please help yourselves. I look
forward to your feedback.


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