Renewable Resources

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Resources are said to be the whole of the capacities and elements (both natural and man-made) that can be utilized to produce goods or services or that have an intrinsic value without the need to be modified and are scarce in relation to the current or potential demand.

Renewable resources are those resources that are not exhausted by their utilization because they return to their original state or are regenerated quicker than they are decreased by use. This indicates that certain renewable resources may, in fact, cease to be renewable if the rate of use is so elevated that renewal becomes impossible. Within the renewable resources category are water and biomass. Some renewable resources are classified as perpetual resources because regardless of their high rate of use, they cannot be exhausted. Within this category of renewable resources are hydroelectric and solar energy as well as wind power and waves.

List of important renewable resources:

  • Biomass: Forests and wood, agricultural products
  • Water
  • Hydraulic Energy (may be hydroelectric)
  • Solar radiation
  • Wind
  • Waves
  • Geothermal energy
  • Fish

Energy and Renewable Resources

With respect to energy, besides the production of electricity using direct solar radiation, most renewable resources with the capacity to provide energy come from the sun (99.9% of earth’s energy comes from the sun). For example, hydraulic energy exists because the heat of the sun and wind work together to move water from low lying to elevated areas. The biomass that may be used as bio-fuel exists due to the photosynthesis process, which is an efficient use of solar energy. The energy that comes from the wind exists because the sun’s energy heats different regions in different ways.

While the total energy available is enormous, it is a challenge to transform the available energy into energy that can be of use to mankind. The efficiency of transforming energy from one type to another, for example the transformation of hydraulic to electric energy, or the use of energy without transformation, for example heating water with sunlight, depends on the technology available. New scientific and technological advances are decreasing the amount of energy lost during transformation.

The following is a list possible renewable energy resources which will be discussed below: hydraulic energy, solar energy, wind power and energy from biomass.

Hydraulic energy is a mechanical energy that comes mainly from the water that travels from elevated to low lying areas due to gravity. The mechanical energy contained in the movement of water has been used by man since ancient times via watermills that directly use mechanical energy. Currently, this renewable energy can be harnessed through the building of dams and hydroelectric plants that transform it into electric energy. Hydraulic energy is considered to be renewable because after its use, the water returns to the elevated areas (water cycle).

Solar radiation contains energy that can be transformed into heat (caloric energy) or into electric energy. Primary solar energy is a renewable resource.

Wind power can be transformed into electric energy with the use of wind turbines.

Biomass contains energy because photosynthesis accumulates solar energy. Through combustion, the energy contained in the biomass can be transformed into caloric energy, electric energy or processed to create bio-fuel which can be used in cars or other types of transportation. Biomass is a renewable resource if its rate of use is less than or equal to its rate of regeneration.

The recent growth of the biofuels sector has contributed to the swell of food prices all over the world, putting at risk the food security of many countries, in particular poor countries which are net importers of food.

Water as a Renewable Resource

Clean water is a renewable resource due to the water cycle, but this does not mean that it is an unlimited resource. The increase in population as well as contamination and the destruction of clean water natural resources can put at risk the availability of this resource.

For example, if water is extracted from an aquifer at a rate of use that surpasses the rate of renewal, the water from the aquifer can cease to be renewable. The same would occur if the agricultural activities of a particular elevated area do not allow water to seep into the ground.

Agricultural Products as Renewable Resources

Vegetables have the capacity to grow without exhausting the soil, therefore, they are considered to be a renewable resource as long as this requirement is met. That is to say, if the rate of consumption does not prevent future renewal. A narrower concept takes into consideration the entire production process. Therefore, the agricultural products (food, bio-fuel, raw materials, chemicals, etc.) are considered to be renewable only if in addition to its production, the collection, logistics, processing and distribution of the product are also considered as “sustainable”.

Products from forests such as wood, chemicals and paper can also be renewable resources if they are produced with sustainable techniques.


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This content is for information and educational purposes only and should not be considered investment advice nor portfolio management. Past performance is not an indication of future results. Leveraged products can carry a high degree of risk.
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