All over the world, governments have set aside money for the green energy sector to help get their economies on course, writes Charlie Thomas for FTAdviser. The combined allotment for “green money” in global stimulus packages may be more than $500 billion.

Earmarked funds are being spent on climate change-related investments, such as improvements to railway, grids and water infrastructure.

• The European Recovery Plan involves investments in energy, including offshore wind and carbon capture and storage.
• The American Recovery and Reinvestment Plan will improve renewables, building efficiency, low-carbon vehicles, mass transit, grids and water.
• In December, a climate change meeting in Copenhagen will try and bring more countries, such as China and India, into the environmental accord. Energy efficiency and alternatives will also be addressed. Even if a global agreement on key issues is not met, individual countries will likely continue on with their own projects.

Green technology is becoming popular, but investors should be wary of a possible “green” bubble that could form as a result of hype. (Read how to protect yourself from bubbles). This sector is more of an emerging technologies sector, and investors should note the possible high volatility and risks involved. Find out how to follow trends here.

For more information on green energy, visit our alternative energy category. Among the many ETFs to choose from in this sector include:

• Market Vectors Global Alternative Energy (NYSEArca: GEX): up 7.8% year-to-date

• iShares S&P Global Clean Energy Index Fund (NYSEArca: ICLN): up 7.4% year-to-date

• Claymore/MAC Global Solar Energy (NYSEArca: TAN): up 12.7% year-to-date; FSLR is 10.8%

• iPath Global Carbon ETN (NYSEArca: GRN): down 5.1% year-to-date

• PowerShares Global Wind Energy (PWND): up 38.8% year-to-date

Max Chen contributed to this article.

Why hasn’t renewable or sustainable energy been utilized in the United States as a mainstream source of power yet? Italy, Germany and Sweden and China are miles ahead of the U.S. in their quest for sustainable energy. Michelle Melio for The Examiner reports that the United States invented much of the modern solar technology, while the rest of the world (even developing countries) is creating much more power from it than we are.

However, there are a number of factors that favor the growth of solar and wind energy both in the United States and overseas, including:

• DuPont has invested $120 million in solar energy; they also anticipate that the photovoltaic market will grow rapidly over the next several years
• Solar panels are getting cheaper (however, sales have slowed because of tight credit markets)
• The energy and Treasury departments said they’d give $2.3 billion in tax credits to clean energy equipment makers, says Keith Bradsher for The New York Times
• Wind energy now supplies 2% of U.S. power and grew 60% in 2008, making the United States the world leader, according to a U.S. Department of Energy report
• Wind projects accounted for 42% of new electric capacity in 2008

There’s a growing number of alternative energy ETFs available. Among them:

• Claymore Global Solar Energy ETF (TAN): up 0.91% year-to-date

• First Trust ISE Global Wind Energy Index (FAN): up 24.7% year-to-date

• PowerShares NASDAQ OMX Clean Edge Global Wind Energy (PWND): up 36.8% year-to-date

For more stories about alternative energy, visit our alternative energy category.

The American Wind Energy Association (AWEA) recently issued a “B” rating for the United States’ progress toward making 20% of the country’s electricity supply from wind energy by 2030, according to Power Engineering. However, the country received a “C-” for electricity transmission. Other areas graded include an “A-” for technology, “B+” for manufacturing and “B” for siting.

The AWEA expects wind farm development to slow down this year and cited some policy moves that would beneficial to this sector, which include a renewable electricity standard and energy legislation that cover transmission.

In Texas, Billionaire investor T. Boone Pickens says he will be delaying a $10 billion “Pampa” wind energy project till 2013 when Texas completes a $4.9 billion transmission line, as stated in Houston Chronicle. Once the grid is improved, wind and solar power may replace electricity generated from gas and coal.

Picken’s Mesa Power LLP previously ordered 667 wind turbines, which produce up to 1,000 megawatts, and starting in the first quarter of 2011, the turbines may be either installed or thrown out.

Fortunately, both available wind ETFs have a global allocation – the United States is not the top country weighting in either.

• First Trust Global Wind Energy (FAN): up 10.8% year-to-date; Spain is 26.3%; United States is 17%; Germany is 14.3%

• PowerShares Global Wind Energy (PWND): up 21.4% year-to-date; Spain is 23%; France is 14.7%; Denmark is 12.4%

For more information on wind energy, visit our wind category.

Max Chen contributed to this article.

One such form of renewable energy gaining some additional attention is wind energy.  One reason it is drawing the attention is that it is the largest highly concentrated form of renewable energy on Earth and has the potential to power all civilization.  A second reason is the efficiency of this form of energy.  It requires a relatively little area per person to generate energy, states Katie Howell for The New York Times.

Unfortunately, it isn’t all sunshine and smiles on the wind energy platform.  Some obstacles that need to be overcome include the reliability of wind power. Jet streams are more reliable than winds on the ground, but they don’t provide as reliable an energy source as coal-fired power plants. There are a handful of start-ups working to harness those high-altitude winds, though.

Regardless, most scientists remain fairly optimistic of the future of wind energy and predict that eventually, the technologies will be there within a decade.

Some ETFs to take a look at are the following:

• PowerShares Global Wind Energy Portfolio (PWND): up 25.1% year-to-date

• First Trust ISE Global Wind Energy (FAN): up 14.1% year-to-date

For more stories on green ETFs, check out our green ETF category.

Kevin Grewal contributed to this article.

Texas appears the be the leader when it comes to wind power, however, Iowa is blowing out the competition past California, generating the most wind energy. According to Dirk Lammers for Associated Press, The Lone Star state’s 7,118 megawatts dwarfs Iowa’s 2,791 megawatts and California’s 2,517 megawatts, but wind power has grown into a key part of the energy infrastructure in Minnesota and Iowa.

Each state generates more than 7% of energy from wind turbines, and many of them are trying to lure energy companies and create a job market to support the alternative energy industry within their borders. Jobs in this industry have jumped 70% to 85,000 since 2008, but there is much more work needed so ensure that this progress does not go by the wayside.

Meanwhile, shares within this industry took a beating in this market, as companies devoted solely to clean energy fell to about $100 million from $2.1 billion, according to New Energy Finance, an industry-research firm.

Green energy investing is an area that’s growing rapidly, though. David Hoffman for Investment News notes that investment offerings seen as environmentally friendly saw their assets grow 640% from 2001 until last year.

• PowerShares Global Wind Energy (PWND): down 0.5% year-to-date

• First Trust Global Wind Energy (FAN): down 3.1% year-to-date

A top priority for President Barack Obama is the reduction of dependence on foreign oil and the revival in renewable power sources that will ensure “another American century,” reports David Biello for Scientific America. Obama has recently signed off the stimulus package that included $15 billion to a credit-starved alternative energy industry.

The money would be put into projects such as new transmission lines to carry wind energy from the Great Plains. The government may also create a cap-and-trade program that would limit pollution and power plants would be able to sell/buy the right to emit a level of greenhouse gases so as to make alternative energy more profitable.

Green energy advocates think the $15 billion provided in Obama’s plan is a poultry amount and critics say the jobs provided would be of no help to unemployed machinists in the Rust Belt, writes Aaron Task for Yahoo! Finance.

There is no defined alternative energy platform so no one knows how much is really needed to invest in clean technologies. Some consider clean tech a “giant capital pit” and it is noted that investors should focus on technologies that play on existing industries, like hybrid car batteries.

Among the many choices available for investors today include:

• Claymore/MAC Global Solar Energy Index ETF (TAN): down 28.3% in the last month; down 28% in the last three months
  
• Market Vectors Solar Energy ETF (KWT): down 26.8% in the last month; down 24.1% in the last three months
• PowerShares Cleantech Portfolio (PZD): down 14.4% in the last month; down 5% in the last  three months
• First Trust ISE Global Wind Energy (FAN): down 16.4% in the last month; down 11.4% in the last  three months
• PowerShares Global Wind Energy (PWND): down 13.8% in the last month; down 6.7% in the last  three months

Pros and Cons. Project Cape Wind is a Boston firm’s plan to build 130 windmills across 25 square miles of federal waters off Cape Cod. Stephen Power for The Wall Street Journal reports that supporters say it will reduce greenhouse gas emissions equal to taking 175,000 cars off the road. Opponents say this will industrialize Nantucket Sound, a Summer vacation spot and fishing and recreation destination.

Obstacles In the Way. The Bush administration is expected to publish a review of the expected environmental impact of the project, one of the last regulatory obstacles, before Barack Obama takes office. The recent conflict to arise over Cape Wind is an example of how policy makers and environmentalists continue to butt heads and local resistance is true hurdle, as big windmills, acres of solar panels and large-scale transmission lines, are part of the trade-off.

Will the U.S. Ever Be a Leader In Wind Power? The Energy Department last year said wind energy could generate 20% of the nation’s electricity by 2030. But that will only happen if a “superhighway” transmission system is created to transport the energy from rural areas to big cities.

• PowerShares Global Wind Energy (PWND) down 17.4% for past three months

• First Trust Global Wind Energy (FAN) down 23% for past three months

Conventional pinwheel wind turbines are large, crowded together on wind farms, and need headwinds of 22 miles-per-hour, which generate electricity transmitted to urban areas, writes Kevin Butler for the Long Beach Press-Telegram.

The bulky size for conventional turbines prompted the two engineering professors to design an efficient turbine that can generate electricity from slower wind speeds in urban areas. Such areas along beaches, near freeways, rooftops, street lights, or billboards are seen as untapped potential wind-energy generating resources.

The professors’ new type of turbine is analogous to the spinning motion much like a police siren. This type of turbine allows for smaller and lighter designs with less vibration.

But the most important part is that it is able to generate usable power at wind speeds of 14 miles per hour. It is also designed so that they may be stacked on top of another two efficiently capture wind gusts from different directions.

There is a small caveat to the professors’ design. Their turbine converts 30% to 35% of wind energy to electricity, compared to the large pinwheeled-type, which converts 40% to electricity.

Nevertheless, if implemented correctly we may see an impact on some relatively new wind ETFs such as:

• PowerShares Global Wind Energy Portfolio (PWND): down 61.7% since July 8 inception

• First Trust ISE Global Wind Energy (FAN): down 65.7% since June 27 inception

By adding electricity generated by the sun and the wind to the nation’s power grid, the reliability of the current system and the frequency of blackouts are at stake.

The North American Electric Reliability Corporation says in a report scheduled for release today that unless appropriate measures are taken to improve transmission of electricity, rules reducing carbon dioxide emissions by utilities could impair the reliability of the power grid, reports Matthew L. Wald for The New York Times.

Basically, the actions of implementing wind and solar energy would place stress on a transmission system not designed for large power transfers over long distances. Imposed carbon emission rules are going to increase demand on natural gas and make power generation susceptible to interruptions.

Greenhouse gas issues and electric utility reliability are battling and so far there has been no resolution.

Could our aging electrical grid hamper the growth of alternative energy ETFs in the long run? One possible solution to the problem would be more use of “demand-side resources,” deals with customers to cut consumption in periods of high energy use.

Will Barack Obama help the issue? One of his big pushes will be for improvements to the country’s infrastructure.

Claymore/MAC Global Solar Energy (TAN) is down 58.8% since its April 15 inception.

PowerShares Global Wind Energy (PWND) is down 54.6% since its July 8 inception.

Many investors are betting on which alternative energy funds and stocks are going to get pushed around by the swings in oil prices, says Jeff Tjornehoj, a Lipper analyst. The ETF is gaining popularity because it is granular, giving options such as solar, nuclear power, biofuels or wind, in an isolated manner, reports J. Alex Tarquino for The New York Times. Mutual funds have not given these choices to investors yet.

It will be a long time before nay of thees industries actually displace the oil industry, but they could be the next big trend. Many alternative energy companies are small-scale, and the industry is a “fledgling” industry.

Oil prices will have an influence over this industry, as oil that is over $100 a barrel is sure to spark interest more than oil prices perched at $10 per barrel. There are many alternative energy sources to consider and which one will gain the most traction is still up in the air.

Could alternative energy become a driving force toward an economic recovery? Sen. Barack Obama has pledged  to create new jobs, in part, through an investment in alternative energy technologies, reports Michael Mccord for Seacoast Online. If any such plan does come through, perhaps we’ll see the unemployment rate sink lower.

• Claymore/MAC Global Solar Energy (TAN), down 46.9% since April 15 inception (black line)
• PowerShares Global Wind Energy (PWND), down 43.4% since July 8 inception (green line)