DEFINITION of 'Renewable Resource'
A renewable resource is a substance of economic value that can be replaced or replenished in the same or less amount of time as it takes to draw the supply down. Some renewable resources have essentially an endless supply, such as solar energy, wind energy and geothermal pressure, while other resources are considered renewable even though some time or effort must go into their renewal, such as wood, oxygen, leather and fish. Most precious metals are considered renewable as well; even though they are not naturally replaced, they can be recycled because they are not destroyed during their extraction and use.
BREAKING DOWN 'Renewable Resource'A renewable resource is different from a non-renewable resource, as once a nonrenewable resource is used, it is depleted and cannot be recovered. As the human population continues to rise, the demand for renewable resources increases.
Types of Renewable Resources
Natural resources are a form of equity, and they're known as natural capital. Biofuel, or energy made from renewable organic products, has gained prevalence in recent years as an alternative energy source to nonrenewable resources such as coal, oil and natural gas. Although prices are still higher for biofuel, the growing scarcity of fossil fuels will result in higher prices, due to supply and demand, and will make the price of biofuel more competitive. Some types of biofuel include biodiesel, an alternative to oil, and green diesel, which is made from algae and other plants.
Other renewable resources include oxygen and solar energy. Wind and water can also be used to create renewable energy. For example, windmills harness the wind's natural power and turn it into energy.
Global Impact of Renewable Resources
Renewable resources have become a focal point of the environmental movement, both politically and economically. Energy obtained from renewable resources puts much less strain on the limited supply of fossil fuels, which are non-renewable resources. The problem with using renewable resources on a large scale is that they are costly, and in most cases, more research is needed to make their use cost-effective.
Adopting sustainable energy is often referred to as "going green," due to the impact on the environment. Energy sources such as fossil fuels damage the environment when burned, leading to global warming and climate change. The first major international accord to curb carbon dioxide emissions and global warming was the Kyoto Protocol, signed in 1997. More recently, global powers met in Paris in 2015 to pledge emissions reductions and focus on higher reliance on renewable resources for energy.
To encourage the use of renewable resources, there are many incentives for using alternative energy. For example, energy taxes put a surcharge on fossil fuels so that the prices of renewable resources are more competitive, and people will be more inclined to switch over. Green funds support eco-friendly and sustainable companies by investing in them, helping to promote environmental awareness.