Renewable energy is the power that comes from naturally replenishing sources like wind, sunlight and water. This clean energy greatly reduces greenhouse gas emissions and contributes to fight against climate change.
The renewable energy market is experiencing quick expansion because businesses and governments are increasingly prioritizing sustainability. This growth opens up lots of ways to invest which makes renewable stocks an appealing pick for investors who want financial returns while contributing to positive environmental impact.
Renewable Energy Stocks Types
Renewable energy stocks provide varied investment chances across different clean energy areas. Let’s look at the main types.
Solar Energy Stocks
Companies involved in converting sunlight into electricity fall under the category of solar energy stocks. These stocks give investors exposure to the booming solar power industry. The solar sector primarily has two main technologies: photovoltaic (PV) and concentrated solar power (CSP).
Photovoltaic (PV) Solar Companies
PV solar companies focus on manufacturing and installing solar panels. These panels transform direct sunlight into electricity. Their companies make solar modules, cells and related components.
Major players in PV sector
- LONGi Solar: It is a Chinese company that has an annual production capacity of 30 GW for high-efficiency solar modules and wafers.
- JinkoSolar: This company can yearly make 36 GW of solar modules.
- Canadian Solar: It is a multinational PV solar company. It has successfully sold more than 125 GW of solar modules worldwide.
- First Solar: Manufacturing thin-film solar plates for utility-scale renewable energy projects is the specialty of this American based company.
Concentrated Solar Power (CSP) Companies
CSP companies are companies that generate heat by utilizing lenses or mirrors to concentrate sunlight. This generated heat is used to drive turbines. This is well-suited for generating power at large scale.
Major Companies in the CSP market
- Acciona SA: Based in Spain, this company develops and run CSP plants on a global scale.
- Brightsource Energy Inc.: An American company specialized in solar thermal technology.
- ACWA Power: It’s a that invests in CSP projects worldwide. This Saudi based firm also operates these projects.
Wind Energy Stocks
Businesses in wind energy sector focus on converting wind power into electricity. These companies are divided into two main categories:
Onshore Wind Companies
These companies help install wind turbines on land and operate them. These firms have been at the forefront of wind energy development for decades.
Major players in Onshore Wind market
- Vestas Wind Systems: This Danish firm leads the global wind energy market in wind turbine designing, manufacturing and installation.
- GE Vernova: GE Vernova, which is a subsidiary of General Electric, runs around 55,000 wind turbines in the whole world.
Offshore Wind Companies
Increased government support and recent technological advancements have rapidly grown the offshore wind sector. Offshore wind companies also install and operate wind turbines but in water bodies.
Major players in Offshore Wind Sector
- Orsted: As of 2024, this is the biggest offshore wind developer that operates with a capacity of 9.8 gigawatts.
- RWE: It is a German utility firm. It has installed offshore wind turbines that have a collective capacity of 3.3 gigawatts.
Hydroelectric Power Stocks
In simple terms, these are companies that use turbines and generators to convert potential energy of water into electricity. This type of renewable energy stock is categorized into large-scale and small hydropower companies.
Large-Scale Hydropower Companies
These are the companies that make electricity by using the water from large reservoirs and dams.
Major players in Large-Scale Hydropower sector:
- China Three Gorges Corp is the world’s biggest large-scale hydropower company with a capacity of 66,523 MW.
- Centrais Eletricas Brasileiras (Eletrobras) is Latin America’s largest power utility that manages 48 hydroelectric plants that have a total capacity of 118,106.20 GWh.
Small Hydropower and Run-of-River Companies
In contrast with their larger counterparts, run-of-river and small hydropower companies work on small scale project that have minimal environmental effect.
Major players in Small Hydropower and Run-of-River sector:
- IDACORP controls Idaho Power Company which run 17 run-of-river hydropower plants.
- Ocean Power Technologies Inc uses the energy of ocean waves to make electricity.
Geothermal Energy Stocks
Companies using heat from the Earth’s core to make electricity fall under the category of geothermal energy stocks which is among the types of renewables. In contrast with solar or wind, this renewable energy source provides stable power output.
Major players in the geothermal energy sector
- Ormat Technologies (ORA): This company focuses on designing, manufacturing and running geothermal power plants.
- Calpine Corporation (CPN): With a capacity of roughly 725 MW, Calpine owns The Geysers which is the largest geothermal field in the United States.
- Berkshire Hathaway Energy: Through its BHE Renewables division, this Warren Buffett subsidiary invests in many geothermal projects.
- Climeon (CLIMBE-B): Based in Sweden, Climeon transforms low-temperature heat (from geothermal and other sources) into clean electricity.
Biomass and Biofuel Stocks
Biofuel and biomass sectors comprise companies that transform organic materials into fuel or energy. You’ll find these firms using different sources such as crops, wood and waste to generate renewable energy.
Major players in Biomass and Biofuel sector
- Enviva Partners (EVA) is the world’s largest producer of wood pellets. It supplies biomass fuel to power plants which contributes to the reduction of coal usage.
- OPAL Fuels (OPAL) is a company that has carved out a niche in renewable natural gas (RNG) production from dairy farms and landfills. Their integrated model captures biogas and converts it into truck fuel.
- Gevo (GEVO) focuses on renewable biofuels and chemicals to produce isobutanol for use in plastics and jet fuel.
- Aemetis (AMTX) has its set-ups in India and California and produces advanced biochemicals and biofuels. Their operations comprise a 65 million gallon per year ethanol plant and a 50 million gallon per year biodiesel facility.
Energy Storage and Grid Tech Stocks
Energy storage and grid tech stocks are companies that provide solutions to increase power grid performance and store renewable energy.
Energy Storage Stocks
Energy storage firms manufacture technologies to store surplus renewable energy to use later.
Major Players in Energy Storage
- Tesla (TSLA)is famous for Megapack and Powerwall battery systems which give energy storage solutions for utility scale projects and homes.
- Enphase Energy (ENPH) focuses on battery systems for solar energy and microinverters.
- Fluence Energy (FLNC) provides utility-scale energy storage solutions globally.
Grid Technology Stocks
Grid technology companies make solutions to promote power grid reliability and performance.
Major Players in Grid Technology Sector
- NextEra Energy (NEE) is a top utility firm that invests great in renewable integration and grid upgrades.
- Siemens (SIEGY) gives many grid tech solutions which include power transmission gear and smart grids.
- ABB Ltd (ABB) concentrates on electrification products and power grids which help to modernize power distribution.
Renewable Energy Yield Cos and ETFs
Renewable Energy Yield cos and ETFs give investors distinctive ways to get involved in the clean energy sector. Yieldcos are businesses that own and run renewable power assets. They provide unwavering dividends and cash flows to investors. These companies normally focus on wind, solar and hydroelectric energy projects.
Exchange-Traded Funds(ETFs) let investors purchase shares in a varied portfolio of renewable energy firms. These investment options give exposure to the expanding renewable power sector while likely having lower risk than buying individual stocks. Well-known Yield cos are Clearway Energy and NextEra Energy Partners while popular renewable ETFs comprise the Invesco Solar ETF and iShares Global Clean Energy ETF.
Closing Thoughts
Renewable stocks give many opportunities for investment. From wind and geothermal to hydro, these renewable energy stocks types represent firms that are pushing the clean power shift. More than 2 trillion dollars in global clean tech investment in 2024 shows that this industry has a great chance of expansion in the long run.
