One of the first executive orders as the newly-minted 46^th President of the United States that Joseph R. Biden Jr. signed was to rejoin the Paris Agreement.

While the U.S. withdrew from the Agreement officially on November 4, 2020 (a day after the US Presidential elections!), there were regulatory rollbacks in place and years of governmental neglect when it came to emissions control and environmental preservation that had already caused significant damage. A lack of strategy and an unwillingness to make evidence-based decisions meant that the American opportunity to lead the world in the adoption of renewable energy was fumbled.

When what the World Bank estimated as a $23 trillion global investment opportunity in solar, wind and hydro power shifted to China and Europe, the United States was left behind. Not surprisingly, now China has five of the six largest solar manufacturing companies, as well as the largest wind turbine manufacturer. Europe has also been leading the way in decarbonization, implementing a $700B renewable energy investment strategy that has meant less coal-burning power generation and the development of an entire economy of well-paying jobs and a supply of energy not dependent on the price of a commodity that a cartel of countries determines.

America’s rejoining of the Paris Agreement without a plan of action would ring hollow. Thankfully, the Biden campaign’s $2 trillion plan to move the U.S. to 100% clean energy and net zero emissions by 2050 was written with the aid of climate scientists and researchers, and backed by concrete steps.

Among the highlights of the Biden climate plan are the following:

1. Decree that US government vehicles migrate to clean energy and zero-emissions
2. Re-instate the Clean Air act and fuel economy standard
3. Investment $400B in cleantech (battery development, carbon-capture, hydrogen research and the decarbonization of the energy grid)
4. Seek to reduce the US building stock carbon footprint by 50 percent in the next 15 years
5. Incentivize electric vehicles by building out the charging infrastructure
6. Remove subsidies from fossil fuel companies – and estimated $17B annually
7. Require public companies to disclose climate risks and greenhouse gas emissions in the supply chain

These are stunning announcements. What is equally stunning is the estimated costs to achieve the goals: $7.8T

But what also needs to be factored into this ‘cost’ is the economic benefit that comes with it. These proposals could create 3.1 million jobs and reduce energy costs by $1.3T. Equally important is to consider the fact that further delay will undoubtedly cost more, with a steeper hill to climb in terms of decarbonization.

Whenever investments are measured in the trillions, and the research and development of entirely new industries is required, there are ample reasons to allocate investor capital there as well. When the government is prepared to back the industry with legislation and stimulus, the reasons for not investing in this space become scarce. For the long term investor, allocating capital to this space now would likely benefit from the investment and asset flows that will follow it well into the future.

In these early days of the Biden administration, beginning with the re-entry of the US into the Paris Agreement, a complete shift in policy will occur – and quickly - because there is a recognition that there is no time to waste. Subsidies will move away from the fossil fuel industry and towards renewables. Decarbonizing our atmosphere and oceans will become the priority in order to reverse the climate changes we are currently experiencing. Revitalizing the US (and by extension the global) economy by investing in the industries needed to address that priority will be the path forward.

Integrating these types of investments into portfolios as part of a larger strategy that takes into account one’s objectives is possible today. In working with me, the process of determining the goals begins with a conversation. Whether it is in long term capital appreciation to preserve family wealth, investing with tax efficiencies in mind, or targeted for growth, consider responsible investments a ‘must have’ for a 21^st century portfolio. The role your investments in clean and renewable energy can have in funding this nascent industry, and the long-term returns that your investments can enjoy while also affecting positive change in the world will power your wealth strategy well into the future.