Brookfield Renewables Continues to Help Us Reduce Our Dependence On Fossil Fuels

The following is a brief introduction to the topic:

My thesis is Brookfield Renewables ( NYSE), ( NYSE ), continue to do their part in helping the world reduce the use of fossils fuels. In the last five years, they have expanded their focus from hydro to wind and solar power as the economics of these alternative energy sources continue to improve. According to my article from October, Brookfield Renewables’ trailing twelve-month (“TTM”) investment through September 2022 was 43% for utility solar, and 27% for onshore wind. However, capacity has grown even more in these fields since then. When I wrote my article in October, the last quarterly supplement that was available showed wind and solar capacities as megawatts (“MW”) of 5,853 and 2,845, respectively. In the 1Q23 supplement, these numbers have increased to 7,188 and 2,266, respectively.

The Numbers

The Statistical Review of World Energy for 2022 and earlier years comes from BP (<a class="paywall-full-content invisible no-summary-bullets" href="https://seekingalpha.com/symbol/BP" title="BP p.l.c. The Statistical Review of World Energy 2023 is from the Energy Institute. These reviews show that global electricity production has increased over time, and renewables are helping to meet this demand. We still produce too much electricity in Asia Pacific from coal and natural gas. As battery storage technology advances, companies like Brookfield Renewable will be well-positioned to help us move away from coal and gas.

In North America, we consume too much gas and coal in North America. This is similar to the situation in Asia Pacific. Brookfield Renewables is in a good position to help us move away from fossil fuels over the next few years:

We can see that the capacity of 1Q23 is similar to 1Q18 , which was 5 years ago. Hydro has remained stable while other segments are booming.

According to the IEA World Energy Outlook2022, utility-scale PV is expected to be cheaper in 2030 than it was in 2020 under assumptions based on Announced Pledging Scenario (“APS”) scenarios. As such, Brookfield will continue to expand their solar investments.

Brookfield’s continued efforts to provide us with alternatives to natural gas is particularly exciting. CEO

Connor Teskey highlighted the importance of the US Market in the 2Q22 Call.

The United States has undoubtedly been the focus of the majority of our activities in the past 12 months. In the last six months, there has been a concentration in that area. Our general rule that, say, 75% or more of our business is in developed countries – primarily North America and Europe – still holds true. This is because, although we may not do as many deals in these geographies, we tend to do larger transactions there.

In his 4Q22 Letter to Unitholders, CEO Teskey described the continuous expansion of the US.

Three large renewable development companies in the U.S. were acquired – Urban Grid Standard Solar and Scout Clean Energy. We continue to expand in the U.S. with these investments. It is our largest market, with 74,000 megawatts of operations and development. We are actively moving forward with development projects in the U.S. on the back of the Inflation Reduction Act, and the strong demand from corporations. This is increasing growth beyond the original underwriting.

Closing Thoughts

Supply chain disruption is a major risk factor for cleantech companies such as Brookfield.

I am more than happy to own BEP indirectly via my Brookfield Corporation investment ( BN).

Disclaimer: This article is not intended to be a recommendation for formal investments. Do your research before buying a stock.