12 green investment themes from Putin’s war on Ukraine

The indoor unit for an air source heat pumps against the colors used by the Ukrainian flag. The core strategy of countries seeking to reduce their dependence on Russian gas is to electrify building heat with heat pump. Photo by author.

By Tom Konrad Ph.D. CFAAltEnergyStocks

Horrific, Tragic, Unprovoked, Heartbreaking.  There is no lack of adjectives to describe Putin’s war on Ukraine.  And while there probably can’t be too much coverage of the tragedies and war crimes, many others can write those far better than I.

The adjective that I will be focusing on as an economic and stock market commentator is “world-changing.”  The first land war in Europe since World War II is already reshaping Europe’s economy in dramatic ways. This is on top of a global epidemic.

Some of these changes, such as Europe switching from Russian gas to coal for electricity generation will cause environmental damage.  Others, like Europe’s longer-term efforts to wean itself off dependence on Russia, will accelerate the transition to a clean economy.  Below are twelve ways I believe that green investors can help facilitate the positive changes and avoid the negative financial effects.

Substituting Russian Oil and Gas Imports

Europe is looking to import more fossil fuels, including from the USA, from other friendly countries in the near future.  Green investors are encouraged to invest.

  1. Avoid shorting US fossil-fuel companies.
  2. Consider the benefits that biofuel producers can reap from wood pellets and other biodiesel and bionatural gas with non-food feedstocks like agricultural residues, corn stocks, and waste from food processing such as shells and peels.
  3. While recycled plastic will likely remain more expensive than virgin plastic made with fossil fuels, the price gap will decrease.  Rising oil and gas prices may bring benefits to plastic recyclers and producers bioplastics.

Food Shortages

Food prices are rising due to the war, and they will continue to rise for at least a few years.  Russia and Ukraine are two of the largest wheat producers. Agriculture is also heavily dependent on nitrogen fertilizer, which largely comes from natural gas.

Green investors should

  1. Do not get too excited about biofuels’ rising prices if they use food commodities for feedstock.
  2. Consider investing in organic farming or farmland.  Not only will the prices of their products rise, but the fact that they don’t use inorganic (fossil fuel-based) fertilizer and pesticides will mean that their costs will rise less than their conventional competitors.

Europe’s Long Term Shift Off Fossil Fuels

While in the short term, Europe will simply be substituting fossil fuels from other sources for the ones it imports from Russia, in the longer term the continent’s move to get off fossil fuels entirely will only accelerate.  There are many ways they can achieve this shift, and most of them are investable.

  1. European renewable energy developers stand to benefit.  This will not only include wind and solar but also renewable natural gas.
  2. Europe’s push to develop a hydrogen economy will also accelerate, benefiting hydrogen companies.
  3. High gas prices and policies will accelerate the shift towards electric vehicles. However, be aware of supply disruptions for vital minerals like nickel, cobalt and rare earth elements.
  4. Due to high fuel prices, we can expect a return to public transit such as rail and buses. Manufacturers of bus and train vehicles should also benefit.  The pandemic caused severe disruption to public transit ridership, but governments have generally stepped in to fill the revenue gap.  While some workers may work from home, others will need to commute to work. High fuel prices will increase their return to public transit.
  5.  Heat pumps and heat pump water heaters are two of the quickest and simplest ways to cut fossil fuel use in buildings.  These devices produce heat so efficiently that even when they are powered by electricity from natural gas, their overall consumption of gas is lower than heating with gas directly.  Installers and manufacturers will both benefit. 
  6. Air sealing and insulation are two of the most important things you can do to reduce your energy consumption. By sealing air leaks, and improving insulation, you can reduce building energy consumption.  Both insulation manufacturers and firms that renovate buildings should reap the benefits. 

Minerals of Critical Importance

All the new investments in fossil-free technology will only make it worse than the shortages of crucial minerals mentioned in the note above about electric vehicles.  Solar and wind also use rare earth elements, in addition to large quantities of steel and copper.

Although the increased demand for mining will benefit mining firms, I don’t like the environmental trade-offs involved in mining.  Many mining companies are also exposed to political risks because they operate in unstable countries and have to pay for unsavory regimes. 

  1. You can benefit from rising materials prices without making any moral, political, or environmental compromises by investing in recycling.  Given the expected increase in demand for all sorts of metals, minerals, and other materials, recycling will not be able to meet more than part of the world’s demand for decades to come.  However, this will not stop recycling of all kinds from rapidly expanding the supply of materials and allowing recycling businesses to grow rapidly in size and profitability.


We cannot ignore the tragedy of war in Ukraine. However, investors (green or otherwise) cannot afford to ignore the opportunities and changes it is bringing to the investing environment.

We don’t have moral to compromise to do this, however.

ABOUT: Tom Konrad, Ph.D. CFA, is the Editor at AltEnergyStocks.com as well as the manager of the Foundation Green Income Fund.


DISCLAIMER – Past performance is not a guarantee of future results.  This article contains the current opinions and are subject to change at any time.  This article is intended for informational purposes only. Forecasts, estimates, or other information in this article should not be construed as investment advice.  This information has been compiled from reliable sources but is not guaranteed.