Green energy is paving the way for a cleaner, more efficient society. Be it in the form of solar, wind, geothermal or hydro, among others, there’s an unceasing supply of these alternative energy sources, all of which are carbon neutral.
Countries in the world are investing in green energy, and the numbers indicate as much. In fact, in the U.S. alone, nearly 15 percent of its electricity production in 2015 is derived from green energy, according to the Energy Information Administration, up from slightly over 11.5 percent four years earlier.
Even in China, a country with a clear history of using non-renewable, green energy is a prime focus. Reports indicated that China plans to invest more than $360 billion into green energy, according to Reuters.
Prior to the coronavirus outbreak, the world was on a trajectory to shift investment from polluting fossil fuels toward renewable energy: Bloomberg New Energy Finance (BNEF) estimated last year that between now and 2050, 77% of investments in new power generation will be in renewables. It’s important that governments and investors treat COVID-19, not as a signal to slow down, but to speed up. New research shows that 75% of Americans are in favor of prioritizing the clean energy industry over the fossil fuel industry in stimulus packages, while 67% support providing financial assistance to renewable energy companies to address the economic crisis. Check energy service companies here
Best green energy stocks
A combination of weather intensification, global policy changes, consumer behavioral shifts, and cheaper clean energy technology will make the 2020s a turning point for green energy. The Bank of America analyst team recently took a deep dive into U.S. renewable energy and electric vehicles to identify the top green stocks for long-term investors. Here are their top 3 picks:
NextEra Energy ( NEE)
NextEra Energy is the parent company of Florida Power & Light, Gulf Power, and NextEra Energy Resources. It has been predicted that NextEra is the top U.S. renewable energy utility stock to buy. NextEra has plenty of bullish catalysts ahead, including strong execution of its utility business, development of its renewable segment, tailwinds from U.S. federal investments, and potential opportunities in hydrogen.
Enphase Energy (ENPH)
Enphase Energy develops and sells solar photovoltaic home energy solutions. Enphase is a top-tier play on solar modules and inverters. 72.6% revenue growth is predicted in 2021 and 83.6% revenue growth in 2022 and the company's impressive growth outlook is not fully priced into the stock at current levels. Also, bullish near-term catalysts include storage growth, favorable policy headlines, and solid core solar momentum. Check green energy service companies here
SunRun designs, sells and installs residential solar energy systems in the U.S. It is a top stock pick in the residential solar group. The stock should benefit from several bullish developments in 2021, including favorable Biden administration policy measures, the potential to refinance existing systems on a large scale, the opportunity to upsell additional services to its growing pool of customers, and the ability to expand the company's grid services and extend its residential solar lead over competitors. Bank of America has a "buy" rating and a $95 price target for RUN stock. See reviews about green energy stocks here.