- Investing in renewable energy – a powerful investment?
- Top Clean Energy Stocks for 2019
- Investor Relations
- Partnership in Practice
- [CHART] The Biggest Investors in Renewable Energy Will Shock You
Investing in renewable energy – a powerful investment?The world faces two monumental tasks. That investment in clean energy could generate enormous profits for investors who choose the right stocks. To get there, we'll need to first take a deep dive into the sector to unearth the most compelling opportunities. From there, we'll need to sharpen our knowledge of what to look for in the companies targeting these opportunities so we can narrow our list to the top options. The term "clean energy" is broader than most investors probably realize. While many believe that the term is a synonym for renewable energy, it encompasses even more sources of energy. Whereas renewables include energy derived from wind, solar, hydro, and geothermal sources, clean energy also includes nuclear, clean coal, fuel cells, energy from waste, biofuels such as ethanol and wood pellets, and natural gas. Because of that, clean energy encapsulates all of the alternatives to oil and coal, not just the renewable ones. That's because clean energy implies that the source emits lower levels of pollution, therefore making it better for the environment than "dirty" fossil fuels like oil and coal, which produce significant amounts of greenhouse gasses and other pollutants. The world is on pace to add 1. To meet this need, the world must continue investing in new energy supplies. However, if governments and companies continue focusing their investments on fossil fuels, it would likely cause carbon emissions to rise to an even more dangerous level. That's why more money needs to go toward lower-carbon options like renewables, nuclear, and natural gas. Because of that, the energy produced by cleaner sources is expected to expand at a fast pace in the coming years. Given this forecast, investors should focus their clean energy investments on renewables and natural gas since those opportunities have the most growth potential. Despite the crucial need for clean energy investment, several headwinds could affect the sector in the near term. For starters, the Trump administration imposed tariffs on imported solar panelsfees enacted to protect the solar industry in the United States. That added to the cost of installing solar and is starting to hurt demand. Those added fees could further dampen the solar sector's prospects in That's certainly the view of the U. Meanwhile, the Trump administration also imposed tariffs on imported steel, which will make wind turbines more expensive. On top of that headwind, federal tax credits for wind power are nearing expiration, which could affect the pace of development beyond Despite the significant promise and growth potential of clean energy, the stock prices of many companies operating in the sector haven't enriched investors. Because the sector can be a challenging one for investors, they need to focus their attention on companies that not only have strong growth prospects, but also sound financial profiles. As such, investors should seek out companies that are already profitable and generate healthy cash flows, because that makes it less likely that they'll lack the funds needed to expand their operations.
Top Clean Energy Stocks for 2019
The largest clean-energy investors of include well-known giants like T. Rowe Price, Amazon, and BlackRock. None of the top 20 clean-energy investors, by capital, were involved in more than two deals, according to BNEF. Business Insider looked, instead, at VC and PE investors that were most active, based on the number of deals they financed or co-financed that closed in Here are the most active clean energy VC and PE investors, ranked from fewest to most deals in Note: "Clean energy" refers to "renewable energy excluding large hydro-electric projects, but including equity-raising by companies in smart grid, digital energy, energy storage, and electric vehicles," per a BNEF spokesperson. IP Group is a London-based VC firm that invests in a wide range of startups — many of which have spun out of universities — to develop intellectual-property-based companies. Clean-tech startups make up a small portion of its portfolio of more than 50 companies. Among the companies in its portfolio is fusion energy startup First Light Fusion; carbon capture startup C-capture; and "smart" hot-water tank company, Mixergy. Formerly known as Statoil, Norway-based Equinor is among the oil giants to recently veer towards clean energy. In Aprilthe firm agreed to align its strategy with the Paris climate agreement. It's also trying to take a leading role in the US renewable industry, after announcing plans to build an megawatt offshore wind farm in New York to supply energy to New York City. BP has been a relatively large player in the renewable industry, owning half of Europe's largest solar developerLightsource BP. The company is also among a trove of recent oil giants that have agreed to link bonuses for thousands of its employees to targets under the Paris Climate Agreement. Total is the seventh-largest oil and gas company in the world and considered a leader in renewable energy among the giants. Total's corporate venture arm, Total Carbon Neutrality Ventures, has 31 startups in its portfolio including Solidia Technologies; the smart-thermometer maker Tado; and SparkMeter, a startup that makes smart meter technology. Total also contributes to the Demeter Partners fund, listed below, and Powerhouse, a prominent innovation and venture firm focused on clean tech and mobility. Demeter invests in mostly European startups that are working on everything from green hydrogen, in the case of Ergosup, to floating wind turbines, per the firm's investment in the company Ideol. BEV has 21 companies in its portfolio including some of the buzziest early-stage energy startups, such as fusion energy company Commonwealth Fusion Systems; cement-tech startup CarbonCure; QuantumScapea secretive battery company; and Sierra Energy, which is trying to commercialize waste-to-fuel technology. Based in Japan, Mitsui is one of the world's largest trading and investment companies with a portfolio that spans energy and resources, healthcare, machinery, and infrastructure.
Partnership in Practice
The world's population isn't getting any smaller, and the demand for energy is only expected to grow over time. Petroleum and coal companies aren't going away just yet, but we can see an increase of money being directed to providers of solar, wind, natural gas, nuclear, and hydroelectric power. Other sources of energy—such as biomass, geothermal, hydroelectric, and tidal power—are also showing increasing promise. There are some current headwinds to the growth of clean energy companies. Still, the overall demand for renewable sources of electricity in the coming years could make certain clean energy companies a good bet for investors. It's been an up and down ride for this maker of solar panels and related equipment. While it has built and operated many of the world's largest solar power plants, its operation is frequently impacted by the whims of solar power demand, pricing, and geopolitical uncertainty. First Solar made headlines as one of the worst-performing stocks during the Obama Presidency. Still, they have sold out their orders for the next couple of years and continue to ramp up production capabilities. If the world continues to move to more solar energy usage, it should be able to cash in. It's unclear, however, whether BWTX's good results stem from its nuclear power business. The company said it expected new revenue to come from the production of nuclear submarines and aircraft carriers, and a newly acquired medical isotope business. Cheniere is America's leading producer of liquified natural gas. Innatural gas produced 1. The U. The natural gas producer operates five liquefaction units in Louisiana, with a sixth in production. However, during that time, the company repurchased 2. The lack of rain led to relatively low output from its hydroelectric dams, but the good news is that Brookfield intends to grow its holdings in wind and solar energy in the coming years—which could lead to growth in share price over time. Tesla may be best known as a carmaker, but it can also also be viewed as a clean energy company due to its investments in solar energy and battery technologies. Infounder Elon Musk merged Telsa with SolarCity, the maker of residential and commercial solar panels, and a pioneer in developing battery technology that powers Tesla cars. These batteries also have a wide range of other possible uses because longer-lasting batteries promise to make electricity grids more efficient and enable more extensive use of alternative energy sources like wind and solar. After reporting their earnings, Tesla has seen its stock price jump to unprecedented levels.