Vancouver, Canada.
On the way to my hotel from Vancouver airport last night I couldn’t help but notice the hybrid taxis and electric buses. This certainly isn’t Montreal. Back home the only electric hybrid we have is a toaster – at least thus far.

But Vancouver, like California, has been going “green” for years and is highly conscious of its environment.

On Friday, China passed some bullish legislation boosting the drive to develop and subsidize clean energy companies. The German have been doing exactly this for several years and recently reduced the green subsidy in 2008.

Still, other countries are on the right path as they aggressively promote alternative energy consumption – including the Obama administration.

Renewable energy encompasses a wide spectrum of sectors, including solar, wind, geothermal, rechargeable batteries, water power, biofuel and hydro-electric power. Even nuclear energy is considered an alternative source of power.

Green energy sources are often considered “green” because they’re perceived to lower or reduce carbon emissions and create less pollution. And we all know the world is burning all sorts of gases polluting our lungs and inhibiting our quality of life.

This decade global governments have sought to link their efforts through reduced carbon emissions vis-à-vis the Kyoto Protocol; the agreement seeks to reduce the effects of climate change offering a framework to cut emissions. Unfortunately, Kyoto has not been widely embraced.

Still, the secular change now underway in alternative energy deserves every investor’s attention; oil prices won’t get any cheaper over the long-term as countries and companies struggle to replace their annual production. The future lies with renewable energy.

Renewable energy was in a “bubble” or mania starting in the mid-2000s and really went into overdrive by 2006-2007 as oil prices went through the roof. Then the credit crisis smashed global markets leaving alternative energy companies at multi-year lows. Despite the big recovery in asset prices since March renewable energy stocks remain 35% to 75% off their all-time highs in 2007.

For investors, index funds and mutual funds in this sector are still relatively new with barely three years of performance history. Indexing this theme, however, is probably the easiest and most cost-effective way to participate in tomorrow’s green energy bull market since the biggest players represent the largest positions in every renewable energy basket.

I’m starting to make investments in this area as the real threat of financial Armageddon finally passes since March. With prices this low you’ve got to look at renewable energy because it is the future. The higher oil and other conventional sources of fossil fuels climb, the more assertive the global initiative to mainstream alternative energy across developed and emerging markets. The future is now.