According to a report last week by The Conference Board and McKinsey & Company, US citizens would not have to make dramatic sacrifices to reduce greenhouse gas (GHG) emissions by 2030.

The study's mid-range case found that the US could cut its emissions by 3 billion metric tons by 2030 at an average cost of $50 billion annually, or $1.1 trillion total. And while those numbers may sound daunting at first, $1.1 trillion would only represent about 1.5% of the $77 trillion expected to be invested in the US economy over the same period.

In fact, according to the study, the US could make 80% of the reductions using technologies that have already been developed and tested, either in the US or elsewhere.

The most economic way to slash emissions, as I've said before, is through efficiency upgrades in appliances and buildings, including the increased construction of green buildings. Simply improving heating, ventilation and air conditioning (HVAC) and insulation techniques could save upwards of 870 million metric tons of emissions.

After efficiency, the next path of least resistance falls in the lap of the transportation industry, which could save up to 660 million metric tons by increasing fuel economy and using more biofuels.

Beyond that, power plants could save up to 1.57 billion metric tons through carbon capture and sequestration, though this would be the costliest option. According to Ken Ostrowski, a McKinsey director, the power sector may have to invest some 90% of its total market cap to curb emissions.

But--and this is a big but--those costs would eventually be offset by switching to fuels that are free after an initial investment, like wind, solar and geothermal.

Ostrowski concluded, "The winners will be the folks that don't resist change, but look at ways to apply innovation and ingenuity to capitalize on the migration toward a lower carbon economy."

Count Us Among the Winners

Just three weeks ago, I told you about utility company PPL Corporation (NYSE: PPL) and its efforts to go green by investing in renewable energy.

I chronicled their recent construction of a new headquarters building certified gold by the Leadership in Energy and Environmental Design (LEED) rating system of the US Green Building Council (USGBC). And I also told you about PPL Renewable Energy, an offshoot of PPL, and its development of a 4.8 MW power plant in Moretown, VT, using landfill gas as fuel.

At the time, PPL stock was trading at $48.48 per share.

Last week, PPL announced plans to build another 6.4 MW landfill gas plant in Shippensburg, PA. The plant, to be completed by December 2008, would save about 39,000 tons of CO2 from entering the atmosphere annually.

Since I wrote about the company on November 12, the price has shot up about 6%. Take a look at their chart from just the last ten days, compared to the utility industry as a whole.

You can see how investing in renewable energy is paying off in real time.

And, of course, this isn't a scenario being played out only in the US. This week in Bali, Indonesia, representatives from 190 countries are trying to establish a framework for a successor to the Kyoto Protocol. A key challenge to success, according to Indonesia's Environment Minister and host of the conference Rachmat Witoelar, is enticing businesses to invest in GHG cuts and other solutions to climate change.

A United Nation's report published in October concluded that $200 billion needs to be invested annually by 2030, half of that in developing countries, to help curb the effects of climate change.

That UN report also concluded that 86% of the investment needed to help the world cut emissions and cope with global warming would have to come from the private sector.

Other news to come out of Bali this week includes the immediate ratification of Kyoto by newly-elected Australian Prime Minister Kevin Rudd. Soon after taking the oath of office, he signed the documents necessary to join the rest of the developed world--except the US--in combating climate change.

This, too, is something I told you would happen. And, as a result, CO2 Group Limited (ASX: COZ), a company I wrote about here one week ago, is up another 6%, capping a 121% gain in one month's time.

But even beyond what's going on right now, this market looks brighter. Congress is currently negotiating a landmark energy bill that could shape the domestic energy sector for years to come.

An agreement to raise efficiency standards to an average 35 mpg for cars, vans and light trucks by 2020 has already been reached. At issue now is whether or not the bill would include contested provisions like a national renewable portfolio standard (RPS) requiring 15% of electricity to been generated from renewable sources by 2020. Another issue is the passage of a $16 billion tax package that would take money away from Big Oil to fund renewable energy projects, including solar.

We should have a clearer understanding of how all this is going to unfold as the week progresses.

One thing, however, remains clear. Change is happening all around us. Even with the lack of federal support, half of the nation's population now lives in states that are voluntarily reducing their emissions via governors' agreements.

Plus, clean technology is now the biggest recipient of venture capital in the US, with over
$4 billion invested last year. And this year, $3.8 billion was invested just in the first three financial quarters.

And the Green Chip portfolio is capitalizing at every turn. The portfolio is up over 69%, and is growing every day.

Make sure not to miss another winning recommendation in one of the market's hottest sectors. Click here to become a member today.

Until next time,

Nick

"Energy stocks... The only way a human is going to make any money."

-- Matt Simmons, Peak Oil's first and most vocal proponent,
and founder of the country's last pure play energy investment banking firm.

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When you give us facts and dont quote your sources or have a reference list at the end then how do I know you didnt make all of it up? It would be nice to know where it is that you get your information because then I know if its true or not.

Some of the lunatics attached to the latest IPCC report are buying into Al Gore's BS. How are we going to make any money when these chicken littles say were gonna be toast in 5 years ?

Nick, you say this:
"those costs would eventually be offset by switching to fuels that are free after an initial investment, like wind,"

Wind is not free after a wind farm is constructed. Those godzilla turbine gearboxes etc wear out at a prodigious rate and have to be completely replaced , metal support columns included - they face tortuous stress in turbulent conditions and suffer metal fatigue. Solar and geothermal on the other hand , yes I agree that they are much more durable,
cheers
Paul

A recent contact with sumter electric regarding there plans to bring 4 coal fired plants on line for furure generating capacity was quarintined by Gov Charlie Crist. I suggested making a deal and swapping 2 nuclear units for two coal units. One of the comments in the seco newsletter regarding their plans was the up front lead time required for the permitting process to bring nuclear plants on line. A fact that is absolutely true especially with the green communist throwing all the garbage in the permitting process to artificially create delay tactics that cost billions which are added to the plant cost and which in fact stop the process dead in its tracks. If there is a technology that is most environmently friendly it is nuclear. I have often asked myself why a technology which saves thousand of lives in the medical field as well as being handled by individuals on a daily basis is frowned upon by so many to provide our energy needs. Consider our naval fleet with carriers and subs powered by on board nuclear plants which generate enough capacity to provide all the electrical needs of the New England states. One sub can take care of the entire city of New York. Alternative technologies make good conversation but are not economical sources most of these technologies produce energy at the bus bar that are well in the catergory of 8 cents / kwhr. Also one must consider the produced cost of energy to include cost of maintenance.Geothermal may suit certain coutries but are we to invade our national parks which have so little potential sites. Photo voltaics have potential on a large scale applications but the arrays are constanly exposed to the bombardment of atmospheric conditions whose energy effeciency output ratio degrades output and years of on line operation. Hydrogeneration was a sought after stratergy but damming up rivers is no longer acceptable. besides we are already having problems with adequate water flowage because we are wasting the resource. Don't get me wrong I have always been very vocal on alternative sources because it affords a good generation mix. However we need to concentrate on those technologies that are going to give the American people the biggest bang for their buck. We have a lot of irons in the fire regarding technologies but we can no longer afford to keep saying we are working on it that is politicians talk and promises. Our boys are in Iraq getting their heads blown off because we are trying to protect an energy resource that the entire world depends upon. Using that resource is good for the world markets But you must use it wisely because it is a finite source. The less dependent we are of it the more stable our economy will become. You talk about investments I am fully vested in the market more so than I should be. My investment stratergies are by stocks that are good value and whose P/E are reasonable. My Father bought $1000.00 worth of Phillip morris stock in 1957 the year I graduated from high school.His advice was I'm buying the company because I smoke Phillip Morris cigarettes and because it pays a good dividend which I told my broker I wanted to reinvest all dividends. My father said I want you to hang on to this company stock for 50yrs.Indeed I did and today its worth 1.5 million. I didn't start investing in the market until 1992 I made some mistakes I also made money which I spent, gave some 60,000.00 to my kids.Just a little while ago I realized a short term net gain of 22,000.00 I read your reports, but before a take a bite on these companies I contact my guys and get their input about their track record. Some of these fingerlings will grow into big fish. Personally I like the big fish

The article is first class and is, as we say in German, water on my mill.

The trouble is that to many people in the USofA have a bad history when it comes to natural resources. They were once abundant and te general public has not cought on yet. We live in a world of limited resources, especially water and healthy food. During the first oil crisis Germany made laws to improve insulation, energy consumption and more.

In the USofA, however, homes are still built like garden sheds even though they are decorated like palaces. Energy prices for private citizens went up about 400% since the seventies but cars still have stupid amounts of horse power that the average driver does no even know how to use. A small car like the VW Jetta is sold with a V6 engine.. For what? In Germany you can only buy it with a 4-cylinder engine which I consider just fine. The four cylinders get you 120 mph at any time.

Our homes have double or triple pane glass. Not only is the glass of a better quality but it insulates temperature and noise (New Yorkes do not even know what noise is) and there is no condensation on top of the savings.

My wife is from New York and she cherishes what she considers "tradition". I, as a German, consider it outdated styles, behaviour, products. We do not live in Washington's time anymore; so homes, bedware, kitchen appliances, shopping habits, resource consumption, and much more should be updated.

The people in the USofA are arrogant. They believe, whatever they do, is just fine. When I shopped for a new cell phone contract I wanted to reactivate one of the many phones I have. The sales person tried to convince me that I would get a certain phone free of charge. That is not he point. Why should another phone be produced, shipped, and made obsolete because a monopolistic cell phone company does not like open standards like they are common in Europe. Cell phones there are cheaper because there is no built-in moat.

Do You know how many cell phones, besides other electronics, are being discarded not because they are defunct but are "not the latest style"? It seems only California has a somewhat responsible attitude. The rest of the country just keeps on polluting the environment.

There is nothing I can see that is good about the USofA. It i a beautiful country but that is not an accomplishment of it's inhabitants. Think about it! If you have convincing arguments, let me know!

In front of third moody Christmas Time, that report sounds like a gift under the Christmas tree
Thanks