What a Fed rate hike means for you
by Patrick Gillespie   @CNNMoneyDecember 13, 2016: 9:45 AM ET

Higher rates are coming back to America.

The Federal Reserve is expected to raise its key interest rate on Wednesday. It would be only its second rate hike since 2006. The first was in December 2015.
One rate hike won't change the world but the process of rising rates affects millions of Americans. If you have a credit card or savings account, invest in stocks or bonds, want to buy a home or a car, pay attention.
The Fed put rates at zero in December 2008 to revive the collapsed housing market during the Great Recession. Now, America is no longer in crisis mode and the economy can bear paying higher rates. A rate hike is a sign that the U.S. economy is improving.

Here's how the Fed's rate hikes could affect you. Read more

1. Savings accounts will pay more
American savers have struggled for years, earning next to nothing at the bank. Now they could be a step closer to light at the end of that tunnel and earn a little more interest on savings account deposits.
When the Fed raises short-term rates, banks pay customers higher interest on their deposits. But how much higher and how fast they will go up will depend on whether the Fed will keep raising rates.
To start seeing a real difference, it could take one to two years at least, experts say. After all, the Fed is expected to raise by just 0.25% on Wednesday. Officials may say they will raise rates two or three times next year, but that could change very quickly depending on the economy's performance.
Last December, the Fed said it would raise rates four times in 2016. But that didn't really happen. This week, if the Fed does raise rates, it will be the first one of the year.
Bottom line: if rates go up Wednesday, it's good news for savers but you still need to be patient.

2. Big ticket buyers: rates are rising but still low
Even though the Fed controls short-term interest rates, its decisions partially impact long-term interest rates for mortgages.
A rate hike does NOT guarantee that mortgage rates are going up. Last year, the Fed did one rate hike and mortgage rates went down this year.
However, the rate hike this time comes at a time when the interest on a 10-year U.S. Treasury bond is going up. And mortgage rates are very closely tied to the10-year note, the yield on which has risen rapidly by about 0.7 percentage points since the election.
The typical fixed rate on a 30-year mortgage is currently around 4.1%. It's risen significantly since the election because President-elect Donald Trump's promises to cut taxes and increase government spending triggered volatility in U.S. bonds. Before the election, a typical 30-year fixed rate mortgage was 3.5%, according to Freddie Mac.
So rates have risen quickly but they are still low. During the last economic expansion -- 2001 to 2007 -- mortgage rates hovered between 5% and 7%. In the 1990s, rates were even higher, shifting between 7% and 9%.
Over time, as the Fed raises rates more, mortgage rates are expected to move up too.

3. Fed likely won't end the Trump market rally Wednesday
Stock markets used to tremble at the mere hint of a Fed rate hike. When the Fed raises rates, that increases borrowing costs for companies, strengthens the dollar and it can cool down spending plans. All those can factors can pinch profits.
But Trump's promise to rev up infrastructure spending and lower corporate tax rates has U.S. stock markets at all-time highs. And just about everyone -- 97% of investors -- believes a rate hike is coming Wednesday, so it won't be a shocker.
However, if the Fed starts raising rates faster than expected next year, the stock market's glory ride could hit some bumps as borrowing costs rise and the dollar gets stronger.
A strong dollar tends to make U.S. products like iPhones more expensive -- and less attractive -- to foreign buyers.
All to say: Investors won't be biting their nails on Wednesday unless Fed Chair Janet Yellen indicates rates may rise faster.

4. Trump could have to handle a hawkish Fed in 2017
The President-elect's big spending plans could drive up demand for all types of goods. Higher demand could increase the pace of inflation, which has been very sleepy the last few years and a big reason why wage growth has been low.
If inflation gets going, the Fed could raise rates faster to keep up with it.
Along with home mortgages, higher rates increase the interest on credit card payments and auto loans. That could cool spenders' appetite. Consumers make up the majority of economic activity in America.
Still, rates are historically very low. The Fed has tried to prop up the economy since the Great Recession with super low interest rates. Trump called it a "false economy" during his campaign.
In any case, the burden of sparking stronger economic growth is shifting to Trump from the Fed. The central bank's role will diminish as the government action will pick up. Trump promises to rebuild America's roads, bridges and tunnels.

But both sides are certainly looking at different crystal balls. Trump is promising 4% annual growth. The Fed is projecting 2% annual growth until 2019.

Even white-collar workers can’t postpone retirement forever. See how your occupation stacks up.
by Ben Steverman December 9, 2016, 7:00 AM EST

One way to prepare for retirement is to save. Another way: Don’t retire.
It’s surprisingly common to put very little aside and hope you never need to hang up your cleats for good. Among investors under age 35, more than four-fifths (83 percent) say they plan to work during retirement, according to a survey released this month by Merrill Edge. It’s not just millennials: 79 percent of Generation X and 64 percent of baby boomers who are still working agree.
And how many retirees surveyed actually have some sort of job?
That would be 17 percent.

From a financial perspective, working into your 70s or 80s can be a great idea. It’s also completely unrealistic for many workers, especially if they want to stick to their chosen profession. It’s not just blue-collar workers with physically demanding jobs who can’t work forever. Even office workers need to prepare for the possibility that their careers will have a natural shelf life.
“As white-collar workers, we tend to believe we’re immune to the factors that cause blue-collar workers to retire early,” Boston College economist Geoffrey Sanzenbacher said at a recent conference. 1  His research, done with colleagues at Boston College's Center for Retirement Research, shows how “age-related decline” hits even well-educated professionals.

As we get older, not all our skills decline at the same rate. And in some ways, we get better. Older workers tend to be more knowledgeable than younger workers, research has found. Though it can take longer for older people to learn new skills or process new information, they are often much better at tasks they’ve practiced extensively. Physical ability varies, too. An older worker who can’t balance on a roof or deliver a dishwasher might have no trouble holding on to a broom.

Taking these differences into account, the Center for Retirement Research used U.S. government data to rate each of 954 occupations on the likelihood that its required skills will decline with age. The result was a “susceptibility index,” with compensation and benefits managers ranking lowest and dancers at the top.
The researchers then looked at data on when people actually retire. Controlling for other factors, they found that people in occupations that ranked higher on the susceptibility index were indeed likelier to retire early. A white-collar worker ranking higher than 75 percent of the group was 7.5 percent more likely to call it quits before age 65 than a worker in the 25th percentile.
Why are some white-collar jobs more susceptible than others? The answer lies largely in the extent to which they require different types of intelligence.

“Fluid intelligence,” your ability to process new information and situations, tends to decline with age. Meanwhile, “crystallized intelligence,” your knowledge of facts and how to perform particular tasks, generally increases through your 50s and 60s, researchers havefound, with little decline after that. That’s one reason designers and stock traders rank higher, or are more susceptible to decline, than, say, teachers and academics.

“The notion that all white-collar workers can work longer, or that all blue-collar workers cannot, is too simplistic,” the study’s authors concluded. For example, photography, a job that can require lots of fluid intelligence, can be more susceptible to age-related decline than jobs as cooks or cleaners, which depend on physical and cognitive skills that last late into life.

Not all the news about aging is bleak. While the health of one segment of the U.S. population has recently gotten worse, Americans on the whole are living longer, healthier lives than ever. A record number are working past age 65, and the share of seniors with dementia has plunged, from 11.6 percent in 2000 to 8.8 percent in 2012. 
Still, even as some talk about raising the Social Security retirement age, we can’t all work as long as we’d like. Over the course of your career, you might want to move away from jobs requiring physical strength and quick thinking, and toward positions that use the knowledge and wisdom you’ve accumulated.
Exercise and good nutrition can help you stay productive longer. And you might want to try saving more, if at all possible. The IRS allows people 50 and older to save an extra $1,000 in individual retirement accounts and an extra $6,000 in 401(k)-style plans. These “catch-up” contributions may come in handy later on.

Buyers are demanding--and paying more for--homes that don't make them sick.
By Robyn Griggs Lawrence

When Meritage Homes began to ask its average buyer, a 36-year-old mother of three, how it could create better value in 2009, the subject of health kept coming up. Moms were worried about kids with allergies and concerned about soaring child asthma rates. They’d read that environmental toxins could disrupt children’s hormone development and watched HGTV shows about people building houses that promote wellness. They said they had enough to think about without having to worry about mold, offgassing, and radon.

Their answers caught company executives off guard. “I kind of missed how important this was initially because I never asked,” says C.R. Herro, vice president of energy efficiency and sustainability for Meritage. “Most builders don’t appreciate how much value they’ll get by going down this road. Talking to people about taking care of how their family feels and offering them better lifestyles is a self-supporting, smart business strategy.”

 In 2014, as a result of this research, Meritage began to add features that improve airflow and reduce toxins in its homes, including better air filters, whole-house water treatment, and low-emitting materials. Salespeople now ask buyers about respiratory issues, which makes sense because 17.7 million adults and 6.3 million children in the U.S. have asthma and more than 50 million Americans suffer from allergies.

At Chicago-based Evolutionary Home Builders, health is a foundational pillar. Brandon Weiss founded the company in 2005 after experiencing healthier green buildings while playing professional basketball in Europe. His new line, Evolutionary Pro Homes, is marketed to meet the exacting physical needs of professional athletes. The homes are designed and built to provide more oxygen, fresh air, and negative ions than traditional homes while reducing toxins and allergens. Weiss says doctors have recorded health metrics of athletes pre- and post-occupancy to show how improved indoor environments enhance performance. His company is already in conversation with athlete home buyers and a home builder in another market with an athlete client who is interested in consulting and branding. “Our customers definitely seek us out for what we have to offer,” Weiss says.

Across the country, home builders large and small are working to determine whether healthy building standards are important for their buyers. Many building pros have been reluctant to offer health and wellness features because they think they will cost more, interfere with schedules and budgets, and lead to conversations with clients about things they don’t understand. But builders who have already stepped into the healthy home arena say these concerns are becoming non-issues.

One of the first steps in committing to healthy building standards is becoming a partner in the EPA’s voluntary Indoor airPLUS certification program, launched in 2009 to provide construction specifications that protect indoor air quality. Bob Axelrad, EPA senior policy adviser for indoor environments, describes the program as recognition for builders who go “above and beyond” widely accepted building standards to create healthier indoor environments.


Indoor airPLUS
This EPA voluntary partnership and labeling program was created to build on Energy Star certification with construction practices and product specifications that minimize exposure to airborne pollutants and contaminants. 

WELL Building Standard
Introduced in 2015, this system for measuring, certifying, and monitoring the performance of building features that impact health and well being is administered by the International WELL Building Institute and third-party certified by Green Business Certification Inc. 

LEED for Homes
This third-party certification program, focused primarily on green design, operation, and construction, includes credits for indoor air quality and low-emitting materials. Health is more prominent in the newly released LEED v.4. 

International Living Future Institute
The institute runs the Living Building Challenge, a rigorous performance standard that “defines the most advanced measure of sustainability in the built environment possible today.” It also oversees the Declare label, which discloses ingredients in products and materials through the Declare product database.

Healthy Building Network
The Healthy Building Network, along with BuildingGreen, created the Health Product Declaration Open Standard for reporting product content and associated health information. Products and materials that comply are included in the Pharos Project, a database for identifying health hazards associated with building projects.

Cradle to Cradle
The Cradle to Cradle Certified Product Standard provides “validation of manufacturers’ ongoing commitment to sustainability and their communities.” The Material Health Certificate uses the same methodology to recognize com­panies that are working toward “chemically optimized products.”

Part of UL Environment, a business unit of Underwriters Laboratories, Greenguard helps buyers identify interior products and materials with low chemical emissions via its free online product guide.

Despite a slow start—the program launched in 2009 just as the Great Recession was beginning and attracted only 300 builder partners for the first five years—interest has boomed, with 800 new builders joining since 2014. Members include builders big and small, from custom home builder Fieldcrest Development Corp. in Greenbush, N.Y., to Tempe, Ariz.–based Beazer Homes, one of the nation’s largest home builders.

Participants see indoor air quality and health as “the next important value proposition that they have to offer home buyers,” Axelrad says, a value that they can use to sell their homes. The Shelton Group, a Knoxville, Tenn.–based marketing communications firm focused on energy and the environment, found most home buyers are interested in health and indoor air quality features in their homes. It’s up to builders to sell it to them, says Lee Ann Head, Shelton Group’s vice president of research.

“Overall, health is a strong purchase driver, and there’s increasing concern about indoor air quality,” says Head. “But there’s work to be done to better communicate about the topic.” For example, a recent Dodge Data & Analytics survey found that most consumers don’t understand how their home can impact their health.

Instead of bombarding potential buyers with technical jargon and health information, Head advises sales agents to fold health into conversations about green certifications and energy efficiency. Consumers are familiar with those topics, and they believe energy-efficient homes are healthier because they have fewer drafts and leaks—meaning less mold and better indoor air.

“When you break a new-home purchase decision into its pieces through conjoint analysis, a special indoor air system isn’t one of the strongest drivers,” Head says. “But it, along with green home certifications, strongly impacts price elasticity.”

At Meritage, it took a while for the sales staff to get comfortable talking about a home’s health-based benefits. Herro says sales agents tried to sell healthy homes like they sold energy efficiency and found it wasn’t effective. After all, he says, a family’s long-term health can’t be quantified in dollars and cents like energy-saving features can. Salespeople—and potential buyers—were intimidated by jargon like MERV (maximum efficiency rating value) air filters and low-VOC (volatile organic compound) materials, and they pushed healthy features rather than overall quality-of-life benefits from the house as a whole. The sales team now focuses on “reminding consumers that they can and should have a better functioning home than they’ve had,” Herro says.

Building scientists say designing and constructing healthy homes involves a few simple principles: plentiful fresh air, nontoxic or low-toxic building materials, and moisture control. The first thing builders can do to mitigate indoor air problems is ask manufacturers what is in their products. Product certifications like Greenguard, Cradle to Cradle and the International Living Future Institute’s Declare label make sorting through product options easier than it’s  

Flashing and airsealing is critical as well. If exterior water is finding its way into a home via leaky windows and roofs, it cannot be considered a healthy home. The contrary can be true, too: Well-sealed buildings can trap in toxic chemicals, mold, pollen, and other irritants so installing a balanced ventilation system with MERV filtration is critical for superior comfort and air quality. Make sure your HVAC contractor distributes it throughout the home to ensure that fresh air gets to important but hard-to-reach places like above beds.

To protect against deadly vapors, install carbon monoxide detectors on every floor and within 15 feet from all bedrooms and place a radon vent below the basement slab that vents through the roof.

Other considerations include whole-home water filtration and hypoallergenic, cleanable surfaces. The EPA Indoor airPLUS guidelines require hard-surface flooring in kitchens, bathrooms, and entryways because they’re easier to clean. Soft surfaces trap dirt, dust, and contaminants that can trigger respiratory issues.

When the USGBC issued the first LEED standards in 2000, anything labeled “nontoxic” or “low-VOC” was significantly more expensive than other products in its category. Some builders haven’t looked closely at products labeled green or healthy since. Jason McLennan, founder and chair of the International Living Future Institute, thinks they should.

“It’s best not to make assumptions and recognize that the costs are changing rapidly and for the better,” says McLennan, whose organization drives transformation toward restorative structures and communities. “Builders need to stay current and realize there are more and more healthy products out there each year and more and more with no premium.”

Costs have come way down for Peter Johnson, whose company Healthy Home Builders focuses on eliminating mold and water issues and selecting nontoxic products in the homes it builds in New York and Massachusetts. Healthy Home Builders includes energy recovery ventilation systems and whole-house air and water filtration systems and specs low- or zero-emitting materials. Four years ago, Johnson paid three times more for formaldehyde-free plywood and had to import it from California. Now, he says, it’s very competitive.

For example, Columbia Forest Products’ PureBond engineered wood products made with soy-based glue are now ubiquitous. Formaldehyde-free fiberglass insulation, introduced in 2009, has also become the norm. The last pink batt bound together with a formaldehyde-based formula rolled off the assembly line in 2015, says Bill Walsh, president of the board of directors for the Healthy Building Network, which he founded in 2000 to reduce the use of hazardous chemicals in building products. “Today we don’t have to think about it anymore,” he says. “That’s the place we want to get for builders.”

Healthier, affordable products and systems have found their way into the mainstream, says Gail Vittori, co-director of the Center for Maximum Potential Building Systems and former USGBC chair. “My goodness, 15 years ago we couldn’t go into a home improvement store and find zero- or low-VOC paint. Now we can. We couldn’t go into a hardware store and find products with no formaldehyde. Now we can.”

Although healthier products are becoming readily available, home builders still have to plan ahead when specifying certain materials, says Scott Steady, environment product manager for indoor air quality at UL Environment. Products such as cabinetry may need to be special ordered, and subcontractors may need instructions about using adhesives and coatings with low-VOC emissions.

In the near future, healthy homes will become increasingly popular as the next big wave of home buyers—millennials—hits the market. Although baby boomers have been important innovators in the healthy home market, young buyers will take it to the next level, says Stacy Glass, vice president of the Cradle to Cradle Products Innovation Institute. “Millennials are so conscious about what they buy. They want to know what’s in it, how it’s made, who made it, and that they were paid a fair wage,” she says.

 Glass, a former green building materials distributor, confirms that the birth of a baby causes a lot of women to seek out low-emitting and chemical-free products and homes. “The most feverish calls I would get,” she says, “were from new moms.”

Chicago builder Weiss has found that families buying their first home and retiring boomers are his best customers, and they’ve done their homework. “Don’t market yourself as healthy if you don’t understand what a healthy home is,” he says. “You have to go above and beyond and look at it holistically.”

Of course, not all home buyers are 36-year-old moms, and builders will have to work to bring reluctant customers to the table, says Carl Grimes, managing director of the Hayword Healthy Home Institute, which educates builders and the public about building science and high-performance homes.

“We’re starting a conversation to get people to realize, wouldn’t it be great to have fresh air to breathe? Wouldn’t it be great to have a new house that doesn’t smell like a new car?” he asks. “It’s possible, and it doesn’t have to cost much more or even more to build a lot of these features into homes now.”

"The Next Big Thing: Healthy Homes," BUILDER (Nov. 30, 2016)

Solar’s Florida future: mostly sunny

MIAMI – Dec. 12, 2016 – Solar industry advocates in Florida are forecasting a mostly sunny future with just a few uncertainties after voters failed to approve a constitutional amendment supported by big utilities in a bitter election battle.
A sign of the increased confidence was an announcement on Dec. 1 by SolarCity, the nation's largest installer, of plans to expand its operations into Florida.
"The industry is evolving almost as rapidly as cell phones these days," said Ray Johnson, president and founder of Fort Lauderdale-based Florida Solar One, one of Solar Power World magazine's 500 most influential solar contractors in North America in 2015. "Solar panels are priced at an all-time low and are now 500 percent cheaper than they were eight years ago."
Interest is also being driven by improvements in storage technology and electronics that control and regulate electricity flows, growing demand for electric vehicle charging stations and "smart home" technology. Another lift came from the federal government's extension through 2019 of a 30-percent tax credit for solar installations, Johnson said.
"Many of the modern custom home builders are contacting us to professionally engineer these highly specialized and advanced home electrical systems and the pace of these inquiries has never been higher," he said.
But even as the amendment battle gave the solar industry untold millions of dollars worth of free advertising, uncertainty over the next moves by Florida's electric utilities is preventing solar from gaining even more traction among homeowners, says Patrick Altier, an Ocala solar installer and president of the Florida Solar Energy Industries Association.
The failure of Amendment 1 to garner more than 60 percent of the vote prevented enshrinement of a decree utilities said was meant to protect non-solar users from subsidizing solar users' connection to the grid.
Opponents contended that language was meant to give the utilities legal standing to push for repeal of state rules requiring them to buy back excess electricity from residential solar users at retail rates. The utilities, including Juno Beach-based Florida Power & Light, maintained they hadn't decided what they would do if the amendment was enacted.
Just because the amendment was defeated, solar advocates counter, doesn't mean utilities won't try new strategies to end the buy-back requirement – known as "net metering." The state's two largest utilities, FPL and Duke Energy, have asked the state Public Service Commission to address net metering, the Miami Herald reported on Nov. 12.
Elimination of net metering, coupled with an increase in the $16 to $30 charge solar users pay each month to connect to the electric grid would drive up the long-term cost of ownership of solar systems, Altier said, and even double the length of time from 10 to 20 years it takes for an owner's investment to be repaid by utility bill savings.
"That uncertainty is one of the biggest things that keep people from adopting solar and moving forward," he said. "Having to tell the customer, 'I don't know what it's going to be' turns into a deal killer."
The association would like to negotiate an agreement with the utilities during the next legislative session that would eliminate the uncertainty. "Whatever it may be – let the chips fall," he said. "Then I could go to my customer and say 'Here's what it's going to be. It's not going to change.'"
The association would also like to see the Legislature quickly enact Amendment 4 – the one voters approved in August with solar industry approval and no opposition from the big utilities. That amendment exempts solar systems from property taxes and is seen as mainly benefiting commercial businesses. Quick enactment will encourage more businesses to install solar, Altier said.
Even in the current climate of uncertainty, the national Solar Energy Industries Association predicts that solar capacity in Florida will increase by 2,315 megawatts over the next five years – nearly 20 times the current installed capacity of 248 megawatts.
Florida, the third-most populous state in the nation, ranked 13th in total installed solar capacity in 2015, according to a report by the Smart Electric Power Alliance. The state ranked 14th in the nation for capacity generated by residential systems – 58.5 megawatts.
But in a comparison of residential solar capacity per household, Florida ranked 26th. The top five, in order, was Hawaii, California, Arizona, Vermont and Massachusetts. Also above Florida were Louisiana, Maryland, Montana, Rhode Island and Texas.
Helping the state make up lost ground will be SolarCity, the nation's largest manufacturer of solar systems. On Dec. 1, the company, chaired by Tesla Motors founder Elon Musk, announced plans to expand its Florida operations. The decision was directly related to the defeat of Amendment 1, the company said.
SolarCity plans to base its expansion at an existing installation facility in Clermont and serve customers of Duke Energy and Orlando Utilities Commission, the company said in a statement. Further plans call for expansion "to additional areas of the state in the coming months," the statement said.
According to the Orlando Sentinel, SolarCity recently began making loans to help make the systems and installations available to area homeowners.
Ed Strobel, owner of Sunshine Solar Services in Fort Lauderdale, said he doubts SolarCity's Florida expansion plans include a rapid move to South Florida "because installing in these conditions is very specialized and to do it correctly, a different engineering mindset is required."
South Florida has stricter wind codes, requiring more attachment hardware, Strobel said. In addition, the area has more homes with tile roofs, and they also require more labor and hardware. The price difference can be as much as $7,000 more to install a typical 10,000-watt system, he said.
SolarCity officials did not respond to requests for an interview for this story. But in an email, Will Craven, director, policy & electricity markets for the company, said the company has no current plans to expand further in the state.
Addressing Strobel's statement about South Florida's stricter installation requirements, Craven said, "all of our products and installation methods are manufactured, designed and engineered to exceed local and state building codes and standards including regionalized wind uplift standards."
Johnson of Florida Solar One said Florida's smaller solar providers are worried about the high-volume provider's entry. "None are happy and all are very concerned," he said. "This is like Wal-Mart moving into a small town."
Altier said he welcomes SolarCity and expects the company to force him and other mom-and-pop solar providers to become more competitive. "I want to see SolarCity do a ton of installations," he said. "It will make us sharpen our pencils and bring down the cost of installation.
"I'm glad to see them. I want to beat them."
Copyright © 2016 the Sun Sentinel (Fort Lauderdale, Fla.), Ron Hurtibise. Distributed by Tribune Content Agency, LLC.

2016 was the year solar panels finally became cheaper than fossil fuels. Just wait for 2017
Written by Michael J. Coren
December 26, 2016

The renewable energy future will arrive when installing new solar panels is cheaper than a comparable investment in coal, natural gas or other options. If you ask the World Economic Forum (WEF), the day has arrived.

Solar and wind is now the same price or cheaper than new fossil fuel capacity in more than 30 countries, the WEF reported in December (pdf). As prices for solar and wind power continue their precipitous fall, two-thirds of all nations will reach the point known as “grid parity” within a few years, even without subsidies. “Renewable energy has reached a tipping point,” Michael Drexler, who leads infrastructure and development investing at the WEF, said in a statement. “It is not only a commercially viable option, but an outright compelling investment opportunity with long-term, stable, inflation-protected returns.”

Those numbers are already translating into vast new acres of silicon and glass. In 2016, utilities added 9.5 gigawatts (GW) of photovoltaic capacity to the US grid, making solar the top fuel source for the first time in a calendar year, according to the US Energy Information Administration’s estimates. The US added about 125 solar panels every minute in 2016, about double the pace last year, reports the Solar Energy Industry Association.

The solar story is even more impressive after accounting for new distributed solar on homes and business (rather than just those built for utilities), which pushed the total installed capacity to 11.2 GW.

But global global investment in renewable energy still lags far behind levels needed to avoid potentially catastrophic global warming, according to the United Nations. Global renewable investment last year was $286 billion, or 25% of the $1 trillion goal set by nations at the Paris climate change accord. Barriers to investment are mostly political rather than economic: Contracts are not standardized, regulatory uncertainty remains, and financial institutions have not created an asset class with a public, standardized track record that will reassure mainstream investors, reports the WEF (pdf, p 12).

But prices are eventually expected to win the day. Solar is projected to fall to half the price of electricity from coal or natural gas within a decade or two. That milestone has already been reached in some locales. In August, energy firm Solarpack contracted to sell solar electricity in Chile at just $29.1 per megwatt hour, 58% below prices from a new natural gas plant.

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