Renewable energy stocks are grabbing more attention daily. As the cost of natural resources continues to rise, both companies and governments are making a significant shift towards clean energy solutions.By investing in renewable energy stocks you are supporting companies that work towards a clean energy future.
Since the beginning investors have recognized the long-term potential and stability offered by renewable energy sectors, such as solar, wind, and hydropower. As a result you might be tempted to look into renewable energy.
According to an IEA report clean energy investment has gone up by 50% (USD 1.8 trillion) last year (2023). New residential buildings are increasingly incorporating clean energy sources like solar panels, indicating a growing reliance on renewable energy even in our homes. Cars such as Tesla are driven purely by renewable energy. Governments are encouraging citizens to clean energy by tax incentives or interest free loans.
With such tremendous potential, it is clear that the renewable energy market will continue to grow. There are several hundreds of renewable energy stocks to choose from, we can refer to InfinityPP for more information.
In this post, we will discuss top renewable energy sources, companies worth looking into and different ways to get involved.
Top Renewable energy sources
1. Solar Energy
This is one of the earliest renewable energy sources harnessing the natural sunlight from the sun turning into energy is one of the efficient energy sources. Solar Panels installed on the roof of houses utilizes solar energy.
Rich oil countries such as Saudi Arabia are investing into Solar energy as-well. For instance, Saudi Arabia has started the work on the largest solar-power planet.
2. Wind energy
Wind energy has been used long ago for example to grid grain into flour. However, it can be used to generate electricity. Wind Turbines are machines with three large blades that utilises the wind to generate electricity.
Installing wind turbines is not an easy process and companies partner with the government to locate areas where wind turbines are better suited. As it relies on wind, the speed of wind is an important factor.
3. Geothermal Energy:
Geothermal energy (where “geo” stands for earth and “thermal” stands for heat) involves harnessing heat from the Earth’s inner core and converting it into electricity.
Unlike other energy sources, it does not depend on external factors such as sunlight or wind, making it available 24/7.
However, a key point to note is that setting up geothermal power plants is expensive, making it less feasible for developing countries.
Which renewable energy companies should I invest in?
Finding the right renewable energy company can be challenging as due to the high demand there has been a massive competition in the industry. There are few companies that worth looking into:
Vestas Wind Systems (VWDRY)
Known as the pioneer of wind turbines, Vestas Wind System has been the front of wind turbines. They tend to produce most of the materials from recycled sources which makes it great.
Enphase Energy(ENPH)
Enphase, unlike Vestas or other companies, focuses on solar microinverters. Enphase is the leader and has recently partnered with several energy companies to expand their market.
Ormat Technologies
With a focus on the three key renewable sources Geothermal Power, Waste HEAT and Energy Storage, Ormat Technologies targets all three sources. Ormat was founded in 1965 and its first clean energy production was in 1966 an electric water pump powered by Solar flat plate. This is a company that has a strong potential and is the leader in geothermal energy.
Good Energy Group
A UK based company that focuses on several clean energy products Heat Pump and Solar Panels. It also offers additional services such as installing Tesla Powerwalls. Heat pump interest over the UK has increased especially with the high cost of electricity bills so this is a company that is worth looking into.
Drax
Drax Group operates in different sectors of renewable energy such as Biomass Power Generation, Hyde Power and Pumped storage. It positions itself as a unique energy company.
Please note, there are many more companies but the above can be the beginning of your investigation.
Should I invest in renewable energy stocks?
Like every other investment, investing in renewable energy stocks comes with risks and depends on various factors. However, investing in renewable energy not only has the potential for financial returns but also contributes to environmental sustainability.
While there might be hundreds of renewable energy stocks, finding the right one can be challenging. On InfinityPP we can come to know several renewable energy companies that have their unique advantages which makes it easier for you.
In the UK you can use the yearly Stocks and Shares ISA investment allowance, which offers a tax free investment and if you like to purchase stocks have a look at trusted brokers which are regulated and are registered with the company house.
Investing in clean energy stocks contributes to clean energy.
Conclusion
Clean energy plays an important part in our society and as our demand for energy increases we require more energy. There will be a period where fossil fuels will be limited and companies that had an earlier investment will dominate the market.
Renewable energy stocks offer a plethora of benefits but each and every company needs a thorough analysis before investing in. It is a good practice to diversify your portfolio if you are seeking to invest in renewable energy, for instance instead of buying a large stock in one company you can split it into two and buy from two different companies.
