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What are the Different Types of Energy Investments?

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  • Written By: Miranda Fine
  • Edited By: O. Wallace
  • Last Modified Date: 22 August 2016
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There are many different types of energy investments. There are fossil fuels like petroleum and coal, renewable energy sources such as solar power and biofuels, nuclear energy, as well as companies that find ways to increase energy efficiency and conserve resources. There is a growing consensus among citizens, politicians and energy experts that the United States must reduce its dependence on foreign petroleum as it faces increasing energy demands.

An increasing recognition of dwindling petroleum reserves, political instability in major petroleum producing countries, and concerns about global warming have made current and future energy use a major focus of foreign and domestic policy discussions. It has also brought new interest and attention to energy investments that are an alternative to fossil fuels. Building new nuclear power plants is under discussion, although this remains controversial, and the economic stimulus plan of the Obama administration includes funding for research and development of alternative energy sources such as solar and wind power, and biofuels.

Investing in oil has made many people extremely wealthy. Large multinational petroleum companies continue to make record profits, although petroleum production is highly subject to worldwide political conditions. Many petroleum companies that operate in poorer countries have had their labor and operational practices questioned by labor, human rights and environmental organizations. As worldwide reserves dwindle, new forms of petroleum extraction are being performed that provide new forms of energy investments, such as in the coal-tar sands of Canada.

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Coal and natural gas are other traditional energy investments in fossil fuels. The United States continues to produce a significant portion of its electricity with coal, and has vast coal reserves. Coal is criticized for producing air pollution and greenhouse gases, and some companies are trying to develop “cleaner” coal technologies. Natural gas is considered a “cleaner” energy source that consists mostly of methane gas, although it must undergo considerable processing. The United States is rich in natural gas fields.

Nuclear energy is a controversial energy investment. It has the potential to produce great amounts of electricity without the pollution and greenhouse gases associated with fossil fuel energy sources. Critics counter that the nuclear industry has not figured out how to responsibly dispose of the toxic waste generated by nuclear reactions, and point to the disastrous consequences of mishaps at nuclear plants, such as the Chernobyl disaster in the former Soviet Union.

Alternative and renewable energy investments such as biofuels, wind, solar, and geothermal energy are currently receiving much attention and are growth industries. Large and small companies are involved in producing, researching and developing alternative and renewable energy, from small local businesses to multinational energy corporations. While many of these technologies are just being developed or expanding production, they are likely to become increasingly valuable sources of energy in the future.

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