Fossil fuels continue to dominate the global energy landscape, comprising 81% of the world's energy mix in 2023 [1]. Despite the rapid growth of renewable energy sources, the dependence on coal, oil, and natural gas remains significant, particularly in developing nations where energy demands are high.
The Current Global Energy Landscape
In 2023, coal, oil, and natural gas collectively maintained their position as the primary sources of energy worldwide. Coal alone accounted for 35.5% of global electricity generation, reflecting its persistent role despite environmental concerns and the push for cleaner alternatives. The stability of fossil fuels in the energy mix underscores the challenges in transitioning to renewable energy on a global scale, especially in regions with growing energy needs.
Transition to Renewables
Despite the steady growth of renewables in the global energy mix, they still represent a smaller share of total energy consumption. The ongoing reliance on fossil fuels is largely fueled by their availability, affordability, and the infrastructural investments already in place. However, the desire for a more sustainable energy future is clear, with many countries setting ambitious goals to reduce their dependence on fossil fuels over the next few decades.
Nuclear energy is increasingly seen as a key component of this transition. With its capacity to generate large amounts of low-carbon energy, nuclear power offers a reliable alternative to fossil fuels. Several countries are investing in new nuclear projects or upgrading existing facilities to enhance their energy security and meet climate targets [2]. As technology continues to advance and costs decrease, nuclear energy is poised to play a crucial role in building a sustainable and reliable global energy system.
Fossil Fuel Investments Persist Despite Green Goals
The investment landscape is also evolving, with significant capital still flowing into fossil fuel projects. This trend is evident even among funds labeled as environmentally conscious, with investments in coal, oil, and natural gas still prevalent [3]. The contrast between investor demand for ESG-compliant products and the reality of ongoing fossil fuel investments highlights the complexities of the energy transition.
Outlook for the Future
Taking a longer view, the energy landscape is likely to see a gradual but persistent shift toward renewables as the cost of these technologies continues to fall and as global climate policies become more stringent. However, this transition will not be uniform or immediate. The challenge for policymakers, industry leaders, and investors will be to navigate this transition in a way that minimizes disruption, ensures equitable access to energy, and meets the world's climate goals.
The future of global energy will require a balanced approach, combining the reliability of fossil fuels with the growing potential of renewables. Success will depend on smart policies and new technologies that support this transition.
Explore our Range ETFs as you consider your position in the energy sector.
The Range Global Coal Index ETF
The Range Global Coal Index ETF (COAL) seeks to provide investment results that, before fees and expenses, correspond generally to the total return performance of the Range Global Coal Index. The Index aims to track the performance of a portfolio of stocks that are involved in the metallurgical and thermal coal industry.
The Range Nuclear Renaissance Index ETF
The Range Nuclear Renaissance Index ETF (NUKZ) is designed to provide exposure to companies that are involved in the following segments: Advanced Reactor, Utilities, Construction & Services, and Fuel.
The Range Global LNG Ecosystem Index ETF
The Range Global LNG Ecosystem Index ETF (LNGZ) aims to provide investors with exposure to companies that are involved in the Liquefied Natural Gas (“LNG”) ecosystem. Companies classified as an “LNG Ecosystem” are likely engaged in one of the following areas: production, exploration, development, transportation, and distribution.
The Range Global Offshore Oil Services Index ETF
The Range Global Offshore Oil Services Index ETF (OFOS) is designed to provide exposure to companies that are involved in the offshore oil services ecosystem. Companies classified as “Offshore Oil Services” are likely engaged in one of the following areas: production, exploration, development, transportation, and distribution.
[1] Statistical Review of World Energy 2024, Energy Institute, June 2024
[2] Visual Capitalist, "Ranked: Nuclear Power Capacity by Country," Visual Capitalist, 2024, https://www.visualcapitalist.com/sp/ranked-nuclear-power-capacity-by-country/.
[3] Climate Home News. (2024, July 1). EU green funds invest millions in expanding coal giants in China, India. Climate Home News. https://www.climatechangenews.com/2024/07/01/eu-green-funds-invest-millions-in-expanding-coal-giants-in-china-india/
Risk Disclosures:
Carefully consider the Fund's investment objectives, risk factors, charges and expenses before investing. This and additional information can be found in the Fund's full or summary prospectus, which may be obtained by visiting www.rangeetfs.com/investor-materials. Read it carefully before investing or sending money.
Investing involves risk, including possible loss of principal. There is no guarantee the Funds will achieve their stated investment objectives.
Investments in the energy industry are subject to significant volatility due to changes in commodity prices. Additional risks include changes in exchange rates, government regulation, world events, economic and political conditions in the countries where energy companies are located or do business, and risks for environmental damage claims.
The Funds are non-diversified. Their concentration in an industry or sector can increase the impact of, and potential losses associated with, the risks from investing in those industries/sectors.
International investments may involve risk of capital loss from unfavorable fluctuation in currency values, from differences in generally accepted accounting principles or from social, economic or political instability in other nations. Emerging markets involve heightened risks related to the same factors as well as increased volatility and lower trading volume. Investments in smaller companies typically exhibit higher volatility.
The Funds may invest in securities denominated in foreign currencies. Because the Funds' NAV is determined in U.S. dollars, the Funds' NAV could decline if currencies of the underlying securities depreciate against the U.S. dollar or if there are delays or limits on repatriation of such currencies. Currency exchange rates can be very volatile and can change quickly and unpredictably.
Because the Funds are new, investors in the Funds bear the risk that the Fund may not be successful in implementing their investment strategy, may not employ a successful investment strategy, or may fail to attract sufficient assets under management to realize economies of scale, any of which could result in the Funds being liquidated at any time without shareholder approval and at a time that may not be favorable for all shareholders. Such liquidation could have negative tax consequences for shareholders and will cause shareholders to incur expenses of liquidation.
The Funds are a recently organized investment company with no operating history. As a result, prospective investors have no track record or history on which to base their investment decision. Moreover, investors will not be able to evaluate the Funds against one or more comparable funds on the basis of relative performance until the Funds has established a track record
Exchange Traded Concepts, LLC serves as the investment advisor of the funds. NUKZ, LNGZ, COAL, and OFOS ETFs are distributed by SEI Investments Distribution Co. (SIDCO, 1 Freedom Valley Drive, Oaks, PA 19456), which is not affiliated with Exchange Traded Concepts, LLC, or any of its affiliates.
