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How to Profit With Green Energy

How to make millions with alternative and clean energy sources

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The world is an ever changing place. Some changes appear to be good for humanity and some do not. Right now we are in a place of transition in many different areas, equality for woman, equality for minorities, health of the environment, security from terrorism, security from viruses, capitalism and socialism, and more. Changes are always happening.

Generally, most people who want change think it is coming is too slow. But it doesn’t have to be. There is a way to make change happen faster. How? Make change profitable.

This is, of course, counter intuitive for many people who want change. They think change can only come through elections and the government. That is why this election is so heated. And why many people make demons out of those who hold different political positions than them.

But again, it doesn’t have to be that way. If more people understood how capitalism worked...and how it could work for the causes they believe in most, we’d have a lot less political division and a lot more people focused on making meaningful change by making it profitable to change. A quick look at history shows how this happens all the time.

For example, women were not accepted in the workplace before World War II. But that changed. Why? Businesses needed employees and since the men were off to war, they were willing to accept women as workers rather than shut their business down. By accepting women, businesses made money. Turns out, having women in leadership is actually correlated to higher profits. So now you’re also seeing more and more women put into c-level positions.

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When the government wanted more housing for the population what did they do? They didn’t regulate the housing industry and make it mandatory to build affordable housing. No, they made it profitable for investors by giving them tax breaks. The same is true when the government needed more energy, they gave oil drilling tax breaks.

It’s simple, money and the drive for profits makes change.

Green energy...a charged and unprofitable topic

Alternative energy sources are seemingly a huge market, valued at $928 billion. But the value of a market does not mean it is a profitable market. There has not been a way to get investors involved in green energy on a grand scale. Solar power, wind power, hydro and geo-thermal energy are viewed as too expensive to profit from.

The government tried when it created huge investments into solar, unfortunately most of that money was funneled to “thank” the solar industry for backing specific candidates. Basically, it became corrupt. The answer is not in government-funded projects but in investor-funded projects.

Until recently, investors avoided green energy as they have not seen a model that will generate them profits. My friend, and quite possibly the most successful resource venture capitalist and fund manager in the US, Marin Katusa, is about to change that. He is a very brilliant young man.

Sustainability economics and “Blue Sky Dreamers”

I identify the sustainability economy as a B.S. opportunity, that is a Blue Sky Dreamers opportunity. The Blue Sky Dreamers don't actually want to get their hands dirty. They don’t want to do the hard work of thinking. They want to do the easy work of judging. Henry Ford famously said,

“Thinking is the hardest work there is, which is probably the reason why so few engage in it.”

But judging others… that is easy to do.

These Blue Sky Dreamers don’t understand the actual realities of what it takes to profit from alternative energy sources. They want a green world, which we all want. We all want a better future for our children and descendants than we have today. But they don’t understand that in order to have an electrical world, you have to have all sorts of rare minerals from the earth, such as copper.

united states rare earth imports

Companies like Apple or Tesla and other and other revolutionary technology companies rely on minerals mined from the earth. Here is the problem, 98% of the rare-earth minerals come from China. I think we can all agree that China does not meet the environmental or ethical standards we’d like to see—not by a long shot. For example, Cobalt is mined by children. Is that something we want to support? No.

Most people would rather not acknowledge this—or at least remain in ignorance of it. The world and its Blue Sky Dreamers don't like these harsh realities. They like the idea of a future of clean energy, green values, and butterflies and flowers. The problem is building these things is very difficult—and costly.

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Marin Katusa recently explained to me that Geothermal wells are a great supplier of green energy, but they require extremely deep, ugly, mined holes. These are expensive too. Much more expensive, much larger, and much more ugly than an oil well. So to make this “green” energy, first you’ve got to infuriate all the environmentalists.

But here’s the real problem, these Geothermal wells are not cheap. Neither is solar or hydro power. So while Blue Sky Dreamers want green energy, they don’t know how to pay for it. They don’t think about that, they simply judge everyone who is not producing it. They are, ultimately, by Henry Ford’s definition, lazy.

The Katusa Solution to sustainability economics

When I was a student of Dr. R Buckminster Fuller, he talked about the world’s accounting system being off. He said we are using the old rules of energy in our accounting. We need to adopt the new rules.

This is where Marin Katusa made his breakthrough. Marin figured out how to make sustainability economics profitable. Marin created what I call, “Cosmic Accounting”. Cosmic Accounting creates a way to accurately measure the energy output of “green” and alternative energies in comparison to energy created to oil.

Oil is measured by BOEs. BOE stands for Barrel of Oil Equivalent. 1 BOE = about 6,000 cubic feet of Natural Gas. But until Katusa’s breakthrough, green energy did not have anything like this to compare apples to apples. Katusa creates the GBOE, which is the GREEN ENERGY Barrel of Oil Equivalent. The GBOE is already changing the energy world.

Here’s the math. Don’t worry if you can’t follow it, I can’t either.

how it works:

Katusa formula 1

Our megawatt year of green power is now 8.76 million kilowatt hours (kWh). Now we convert kilowatt hours into megajoules using the defined ratio:

Katusa formula 2

Now we can convert to green BOEs, using the definition of a BOE as 6.12 x103 MJ.

Katusa formula 3

Crazy right? Here’s the short of it:

Using this conversion we now know that 1 megawatt of green power produced over one year is equivalent to 5,154 barrels of oil per year or 14 barrels of oil per day.

The purpose of Katusa’s formula is to figure out how much oil a well would have to gush initially in order to produce the same number of BOEs over its lifespan as a geothermal well (or any solar or wind farm) can produce over its much longer life span. These life spans vary, so we chose three representative values for each kind of well. For the oil field wells we looked at life spans of 10 years, 15 years, and 20 years. For the geothermal field wells we chose 20 years, 50 years, and 100 years.

Now we set our cumulative production equations equal to each other, insert decline rates (1.75% for the harmonic geothermal decline and 14% for the exponential oil decline), and run through our well life spans (T1 = 20, 50, and 100 and T2 = 10, 15, and 20).

Why sustainability is important

Bottom line is this… Green energy produces more energy at a lower lifetime cost. That is why it is investors. This makes Green energy a better investment as it is more profitable. In fact BP, one of the largest oil producers, just held a 3 day conference announcing that the future will be GBOE. Until Katusa made his measurement, no one could measure how profitable sustainable energy would be. Now the world knows...and it’s racing to make its fortune. It’s good for business and good for the world.

The true GREEN revolution is starting. Katusa says:

All of the North American and European companies are going to accept that (GBOE). Now will Saudi Aramco do that? No. Will the Russian oil companies? No. So they're going to do what's best for them.

But the North American and European companies have to meet their criteria of also making money, but also meeting the needs of the environmentalist, the politicians. And like I said, the flow of money won't come in unless they accept the new world that we're in.

Here’s where it gets exciting for investors and people like you and me. Katusa continues:

I am surprised nobody has done this yet, but I am sure the folks at Goldman Sachs will read this report, repackage it as their own concept, and make billions from consolidating the undervalued green energy sector. They can apply the GBOEs (Green barrels of oil equivalent) concept and get bankers to accept the GBOEs on the balance sheet as they BOEs. That’s fine, I hope they do. I have already have run all the numbers on the best and most undervalued green energy producers in the North America. Once word gets out, the buyers will pay my subscribers and I premium prices for our holdings.

I started this blog talking about profit and using that as a motivator to get good works done. Energy is the biggest product in the world, except most of it is wasted. Energy is the biggest industry in the world. Civilization runs on energy. Marin has created a fund that profits from all this energy.

Now for the bad news…Katusa’s fund is sold out. Don’t feel bad, I missed out too.

The good news is Marin does have a great newsletter called Katusa's Resource Opportunities. You can click here to get all of his buys and what he's doing and what his subscribers are benefiting from.

FULL DISCLOSURE: I want in on Katusa’s brilliance and gift for making money so I am a subscriber.

The world is an ever changing place. Right now we are in a place of transition in energy and the environment. And while the change has been slow, it’s about to hit the accelerator… of an electrically powered race car. Profit is the ultimate power for change.

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Original publish date: November 03, 2020

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