Investors Guide to Clean Energy | Sources of Clean Energy
Learn more about our Clean Energy ETF
Part 1: Introduction to the Clean Energy ETF | ZERO
Part 2: Investors Guide to Clean Energy | Sources of Clean Energy
Part 3: Investment Case for Clean Energy
Part 4: Introducing the HANetf S&P Global Clean Energy Select HANzero™ UCITS ETF
The clean energy sector encompasses energy derived from zero-emission sources that are “renewable”, or naturally replenishing. Humans have been harnessing nature’s power for millennia, but as we develop increasingly innovative and efficient ways to do so, renewable clean energy is becoming increasingly viable and displacing the dirtier sources of energy (e.g. fossil fuels) that have dominated economies since the industrial revolution. Growing renewables’ share of generation capacity is a key pillar in the fight against climate change, and in particular with respect to meeting increasingly ambitious targets to drive national economies toward net zero carbon emissions.
The main sources of clean energy, and the energy sources our Clean Energy ETF tracks, are as
Each of these technologies is described in
brief detail below.
Solar photovoltaic cells transform sunlight
directly into electricity. Such systems do not produce air pollutants or carbon
dioxide, and typically have no environmental impact beyond the manufacturing
Effectiveness can be limited by the
intermittent nature of the amount of solar energy that reaches the earth’s
surface, depending on location, weather conditions, time of day, and
seasonality. In addition, large surface area is required to absorb or collect a
useful amount of energy. 
Wind energy is collected through the use of
turbines, which use blades to collect kinetic energy. The blades act as wings,
creating lift as wind passes over them which causes the blades to turn. This
rotation then drives an electric generator, producing electricity.
As with other sources of renewable energy,
location is critical. Favourable sites include the tops of smooth rounded
hills, open plains and offshore. Large numbers of turbines tend to be
aggregated in these areas to form wind farms. In addition, higher altitudes are
generally more conducive to wind generation. As a result, large wind turbines
are placed on towers that are as much as 900 feet high.
Wind energy also does not result in emissions
beyond the manufacturing process. Limitations of wind energy relate
predominantly to the intermittency of wind availability, which vary both hourly
and seasonally. In addition, environmental groups have noted that wind farms
can have negative impacts on local bird and bat populations. 
Hydroelectricity was the first renewable source
of electricity established at scale. It is generated by channeling moving water
through large pipes, where it pushes against and turns blades in a turbine,
which spin a generator to product electricity. These include run-of-the-river
systems, which as the name suggests harness the force of an existing river’s
current, and storage systems which rely on dams to create reservoirs, from
which water can be released through pipes fitted with turbines.
In geographies where it is feasible,
hydroelectricity has long made up a meaningful portion of generation capacity.
It is a prolific source of clean energy, although not entirely without its
challenges, which generally relate to environmental and social impact of
diverting rivers and creating reservoirs.
Temperatures emanating from the earth’s core
are approximately equivalent to the surface of the sun due to radioactive
particle decay. Geothermal energy harnesses this heat where it rises closer to
the earth’s surface and heats water reservoirs from which excess heat is extracted
either as a source of heating or electricity via a turbine and generator.
Viable sources of geothermal energy tend to be
found along major tectonic plate boundaries where volcanos and geysers are most
likely to be found. 
Biofuels are transportation fuels derived from
biomass materials such as corn or sugar. These include ethanol and
biomass-based diesel fuel. Such fuels are typically blended with petroleum products
but can also be used on their own. Even blended fuels burn more cleanly than
pure petroleum products, and the use of biofuels displaces fossil fuels, thereby reducing
consumption all else equal. 
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