In today’s Exponential Investor

  • Outrageous headlines that were not expected ten weeks ago
  • The IEA – no longer an apologist for fossil fuels
  • A first-of-its-kind online event

For more than four years, I’ve been telling anyone who’ll listen that the energy world is undergoing inevitable change.

We’re now well into the transition from traditional fossil fuels to more sustainable solutions.

I’ve helped many of my readers profit from that change along the way, which I’m very happy about, of course.

But I can’t lie…

At the beginning of this year, I didn’t see this change coming:

“US bans Russian energy imports and UK will stop using Russian oil this year” – Sky News

“EU pledges to cut Russian gas imports by two-thirds before the end of the year” – CNBC

“EU to end all imports of Russian oil and gas ‘well before 2030’ following Ukraine invasion” – The Independent

Europe’s energy transition, in particular, has moved right to the very top of the political agenda as the need to break the continent’s reliance on Putin’s gas becomes clearer by the day.

The union imports 40% of its gas from Russia, a figure unchanged in more than 15 years despite repeated gas crises triggered by Moscow cutting off supplies.

It’s not just countries, either; Shell has also turned its back on all Russian oil and gas supplies.

Markets understandably panicked, and oil and gas prices have gone ballistic.

Once again, a black swan is rattling the markets – and this one’s wings are caked in dirty fossil fuels.

So, are we witnessing the end of Russia’s energy empire?

If so, only one question really matters:

How do we begin to wean ourselves off Russian gas?

Well, consensus is forming that any dash from Russian gas will be largely powered by renewables and green hydrogen.

Last week, the International Energy Agency, long seen as an advocate and apologist for the fossil fuel industry, was unequivocal that a sharp acceleration of wind and solar must be a key part of that process. The agency unveiled a ten-point plan that it said could reduce Russian gas imports to the EU by a third within a year.

For its part, the EU is even more ambitious.

The European Commission has now unveiled proposals to further boost renewables and quadruple current 2030 targets for green hydrogen supplies as part of a strategy to cut the EU’s reliance on Russian gas by two-thirds as soon as the end of this year.

The Commission claimed that measures in its REPowerEU plan could make the bloc independent of Russian supplies “well before 2030” as responded to the implications of the invasion of Ukraine.

Alongside a raft of short-term proposals focused on getting more gas from non-Russian sources and boosting gas storage, the plan focuses heavily on the need to electrify using renewables and increase the profile of green hydrogen in the EU economy.

The Commission’s recommendations include a rapid agreement on EU energy efficiency laws, estimated to result in 17bn cubic metres (bcm) of energy savings by 2025, and more EU funds for new solar technologies.

Commission vice-president for the European Green Deal Frans Timmermans said: “It is time we tackle our vulnerabilities and rapidly become more independent in our energy choices.

“Let’s dash into renewable energy at lightning speed. Renewables are a cheap, clean, and potentially endless source of energy and instead of funding the fossil fuel industry elsewhere, they create jobs here.”

Timmermans added: “It’s hard, bloody hard. But it’s possible.”

The “it’s possible” line has certainly found agreement in Berlin. A draft policy plan by the German government aims for acceleration to 2035 – up to 15 years early – of a renewable power system based on what one minister called “freedom energy”.

It’s clear the reshaping of the European energy sector is well underway – and it’s being recoloured green.

The only way to profit among the chaos?

With the chaos around energy supply and the threat of a Russian default, there is no telling exactly what the markets will do over the next few weeks or months.

But we can have an educated guess.

Already investors are turning to clean energy stocks as Russia’s invasion of Ukraine threatens to further raise oil and gas prices.

VanEck senior associate Alice Shen said the US’s decision to ban imports of Russian oil, in particular, could further boost prices, adding to the attractiveness of renewables.

“This trend towards clean energy stocks too will likely gain momentum as energy consumers seek substitutes for fossil fuels and the demand for renewable energy rises to meet climate change carbon emissions targets,” she said.

“The Russia-Ukraine war highlights the vulnerability of countries that rely on fossil fuels, arguably raising the importance of clean energy as an energy supply and it could be an important impetus for the acceleration to clean energy globally.”

Right now, I believe you should be looking to profit from this irreversible, long-term uptrend. Find the markets that are going to continually grow, year-on-year, no matter what else the world throws at us.

I believe green energy is one such trend, though there is actually something even larger going on.

In fact, around two months ago, I started working on a first-of-its-kind online event. The aim of the event is simple: to show you how to profit from what I believe is the crucial megatrend of the next decade or more. It has green energy at its heart but its tentacles actually spread into every corner of the economy.

That might sound like a big claim, but consider this:

The entire cryptocurrency market is currently worth around $2.3 trillion.

The gold market? Around $12.7 trillion.

The market opportunity I’ll be sharing?

It’s already worth $35.3 trillion… and counting.

Frankly, I believe that we could be looking at the biggest financial opportunity in history. And the rush to replace Russian energy has only made it more pressing. You’ll understand why when you click the link below.

This event starts promptly on Monday… and tickets to attend are free.

You just have to click here to find out more.

Best wishes,

James Allen
Editor, Southbank Investment Research