Henry Pomerance

4/25/20

Senior Project 2020

Business and Marketing

Blog Post #5

I have started taking a microeconomics online class, and I wondered if and how microeconomics related to ESG. I realized that the two are related in terms of prohibitive pricing, which is especially evident in the case of renewable versus nonrenewable energy. It touches on two basic but key aspects of microeconomics: 

-As the price of a good changes, so do the buyers and its uses 

-All sellers have lower extraction costs than the non-sellers

As I mentioned in a previous blog post, during the COVID-19 pandemic solar-powered electricity is on the rise due to its lower cost (in many places in the U.S.) than fossil fuels. Consequently, financial institutions are investing in companies involved with solar energy more heavily now. But this is not just to make a quick profit—as the cost of solar becomes less and less prohibitive, its uses will broaden, creating more markets for its energy (including for everyday citizens, as opposed to it previously being limited to mostly commercial use). So, solar is a hot investment right now because it will be sustainable and will expand (both sustainable financially and environmentally). It is a win-win for investors.