Renewable Energy Dividend Stocks Worth Investing In
One of the chief draws of energy stocks is their healthy dividend. Yet, in the era of ESG investing, many investors have begun reallocating their portfolios with a mind for environmentalism. That means moving away from traditional hydrocarbon dividends and moving into renewable dividends. But what are the best renewable energy dividend stocks out there right now?
Renewables are still something of an emerging market. As a result, many up-and-coming companies aren’t quite at the stage where they can reliably pay a dividend yet. Thankfully, there are more than a few large-scale organizations that have diversified into clean energy, and are large enough to bear the burden of a dividend.
Here’s a closer look at a few of the best, most reliable renewable energy dividend stocks available right now, and why they’re worth a spot in your portfolio.
Algonquin Power Utilities Corp. (NYSE: AQN)
This Canadian energy company has all the hallmarks of a dividend growth stock candidate. The company generates green energy through its hydroelectric, wind, solar and thermal facilities. over, it sells energy through Power Purchase Agreements (PPA). It has a strong balance sheet and healthy financials, all of which support a dividend that’s been nothing but consistent in its growth.
As of Q1 of 2022, Algonquin Power Utilities Corp. pays a healthy 4.3%. What’s even more impressive is that it’s paid a dividend for the past 15 years and increased its dividend over the past decade. The five-year trailing dividend growth for the company stands at an impressive 12.4%. As the company continues to command strong sales, a healthy margin and a growing EPS, shareholders can expect this renewable dividend to increase in the years to come.
Brookfield Renewable Corporation (NYSE: BEPC)
Often considered the crown jewel of pure-play renewable energy companies. Brookfield Renewable Corporation is a subsidiary of Brookfield Energy Partners. It has an extremely strong history of returning value to shareholders and a healthy balance sheet that makes it possible to offer a very attractive 3.2% dividend. Investors looking for large-cap confidence with dividend growth potential will find it in this company.
The truly attractive element of Brookfield’s dividend is the balance sheet performance that enables it. The company has a stellar operating margin of 57.7%, which paves the way for superb free cash flow. Recent reporting shows strong quarterly sales growth of 20% and astounding quarterly earnings growth of 108%: figures every dividend investor wants to see from a long-term dividend growth candidate.
List of renewable energy stocks in India
The data is as of 20th April 2023. The above list of renewable energy companies in India was made using Tickertape’s Stock Screener using the following filters:
- Category: Renewable Energy and Renewable Energy Equipment Services
- 1Y return
- 1Y return vs Nifty
- Net income (greater than zero)
- Total debt
- Return on investments
Note that the list is not sorted in any preferred order but is a table of stocks discovered based on the parameters. Past performance is not indicative of future returns. Do not take this as stock recommendations.
Why has renewable energy been in FOCUS?
Given the alarming rate of climate change and escalating environmental concerns, countries across the globe are gradually shifting from fossil fuels to renewable sources to meet their energy needs.
Green energy stocks are companies involved in developing alternative technologies to replace fossil fuels with renewable resources like wind, solar, and hydroelectric. Renewable energy also includes supplementary technologies that will be instrumental in green energy transformation.
Types of renewable energy stocks in India
Shares of any company related to renewable energy can be a clean energy stock. This includes alternative transportation technologies.
As the name suggests, these are more focused and associated with solar and wind energy.
These are companies that use flowing water to generate energy. Currently, hydroelectricity is one of the most popular resources used and is only expected to rise over time.
Overview of the renewable sector in India
As per Invest India, India stands 4th globally in Renewable Energy Installed Capacity (including Large Hydro), Wind Power capacity and Solar Power capacity.
Prime Minister Narendra Modi mentioned in June 2021 that India’s renewable energy capacity grew by 250% from 2014 to 2021. Besides, the share of renewable energy itself increased from 21% in 2012 to 42.5% in February 2023. As of the same period, renewable energy sources, including large hydropower, have a combined installed capacity of 174.53 GW. India saw the highest year-on-year growth in renewable energy additions of 9.83% in 2022.
India was the second-largest market in Asia for new solar PV capacity and third globally. The installed solar energy capacity has increased by 24.4 times in the last 9 yrs and stands at 63.3 GW as of February 2023. The installed renewable energy capacity (including large hydro) has seen an increase of around 128 % since 2014.
Ascent Solar Technologies (OTCMKTS: ASTI)
Ascent Solar Technologies, Inc. designs, manufactures, and sells photovoltaic (PV) integrated consumer electronics and portable power applications for commercial and military users.
It offers outdoor solar chargers, such as XD-12 and XD-48 for the individual soldier and platoon power needs; high-voltage SuperLight thin-film CIGS PV blankets; and solar modules.
The company markets and sells its products through distributors, value added resellers, and e-commerce companies.
Ascent Solar Technologies, Inc. was founded in 2005 and is headquartered in Thornton, Colorado.
Alto Ingredients Inc(NASDAQ: ALTO)
Alto Ingredients Inc. produces and markets low-carbon renewable fuels and alcohol products in the United States.
The company operates in two segments, Production and Marketing.
It produces and markets ethanol; and co-products, such as wet and dry distillers grains, wet and dry corn gluten feed, condensed distillers solubles, corn gluten meal, corn germ, corn oil, dried yeast, and CO2, as well as markets ethanol produced by third parties.
The company also offers ethanol transportation, storage, and delivery services through third-party service providers.
It sells ethanol to integrated oil companies and gasoline marketers; distillers grains and other feed co-products to dairies and feedlots; and corn oil to poultry and biodiesel customers.
The company owns and operates nine ethanol production facilities, including four plants located in the Western states of California, Oregon, and Idaho; and five plants in the Midwestern states of Illinois and Nebraska.
Alto Ingredients Inc was formerly known as Pacific Ethanol, was founded in 2003 and is headquartered in Sacramento, California.
Gevo, Inc. (NASDAQ: GEVO)
Gevo, Inc. operates as a renewable fuels company. It commercializes gasoline, jet fuel, and diesel fuel to achieve zero carbon emissions, and reduce greenhouse gas emissions with sustainable alternatives.
The company uses low-carbon renewable-resource-based carbohydrates as raw materials and is developing renewable electricity and renewable natural gas for use in production processes.
It products also include renewable biodiesel, isooctane, isobutanol, sustainable aviation fuel, isobutylene, ethanol, and animal feed.
The company was formerly known as Methanotech, Inc. and changed its name to Gevo, Inc. in March 2006. Gevo, Inc. was founded in 2005 and is headquartered in Englewood, Colorado
I’m a Technology Stock Analyst, with FOCUS on companies developing cutting-edge techs. Keeping track of cutting-edge techs, companies and stocks is what I do almost everyday. And I love it. Whether it’s artificial intelligence, 5G, or autonomous vehicles; I’m all in.
Siemens Gamesa
With a presence in over 90 countries, Siemens Gamesa offers a range of equipment and services related to onshore and offshore wind turbines, turbine gearboxes, and off-grid systems. The company has successfully implemented its products and technology on a global scale and has the foresight to envision a future where clean energy can power factories and cities, thereby enhancing air quality.
Based in Denmark, Vestas Wind Systems is a wind energy company that specialises in the design, manufacturing and installation of wind turbines. With a global presence, the company has successfully deployed wind turbines in numerous countries worldwide, by harnessing the collective expertise of 29,000 employees.
Through their sustainable energy solutions, Vestas has already made a substantial impact, preventing the release of 1.5 bn tonnes³ of CO₂ into the atmosphere. Furthermore, their contributions have facilitated the establishment of a more sustainable energy system, with over 145 GW of wind turbines installed across 85 countries.
Orsted A/S
Renewable energy company Orsted A/S excels in the development, construction and operation of offshore wind farms. The Danish company holds the prestigious title of being the world’s largest developer of offshore wind power, with a total capacity of over 7.5 GW installed and under construction.
Orsted A/S has successfully established offshore wind farms in various nations, including the UK, the US, Germany and Taiwan. Orsted maintains a firm dedication to sustainability and has set formidable objectives to diminish its carbon impact. By striving to achieve carbon neutrality by 2025, the company demonstrates its unwavering commitment to environmental responsibility.
Iberdrola SA
Multinational electricity utility company Iberdrola SA is of Spanish origin and is headquartered in Bilbao, Spain. It holds a prominent position as one of the largest utility providers globally, operating across more than 40 countries across the globe, with a particular FOCUS on Europe, the Americas and Asia.
Iberdrola primarily engages in the generation, distribution and sale of electricity, and boasts a diverse energy portfolio, encompassing sources such as wind, hydro, nuclear and natural gas.
NextEra Energy, Inc.
Headquartered in Florida, USA, NextEra Energy, Inc., is a prominent provider of environmentally-friendly energy solutions. As one of the largest renewable energy producers in the world, NextEra Energy currently generates a capacity of approximately 30,000 megawatts, largely from wind and solar sources.
NextEra Energy stands out as a prominent American institution, leading the charge in wind and solar energy production. Demonstrating a steadfast commitment to sustainability, the company has established ambitious targets to curtail its carbon dioxide emissions. By 2025, NextEra Energy aims to decrease its carbon dioxide emissions rate by 67% in comparison to 2005 levels.
What’s on this page?
Despite the global lockdowns that came with the emergence of the Covid-19 pandemic, it’s evident that there’s been Rapid growth in wind and solarphotovoltaic (PV) as renewable energy sources. 1
According to the International Energy Agency (IEA), the United Nations Change Conference (COP26) held in November 2021 shone the spotlight on the reduction of carbon emissions and the use of clean energy. COP26 goals for 2030 include accelerating the phasing out of coal as an energy source, preventing deforestation, speeding up the switch to the use of electric vehicles and encouraging investment in renewables. 2
In 2021, China was the global leader in renewable energy installations, and according to IEA predictions this’ll continue for the foreseeable future. 1 However, an increasing number of emerging markets are following suit.
Mobilising the world to be on track with COP26’s target of net zero emissions by 2050 will need an investment of 4 trillion a year by 2030. This’ll allow for the accelerated transition into clean energy.
There’s huge growth expected in clean energy technologies over the next decade in IEA’s Net Zero Emissions by 2050 Scenario (NZE), which is likely to lead to this renewables market being worth a cumulative 27 trillion by 2050. 1 The combined renewable energy market includes wind turbines, solar panels, lithium-ion batteries, electrolysers and fuel cells.
It’s predicted that by 2050, there’ll be about three billion electric vehicles (EVs) globally, which‘ll require three terawatt-hours (TWh) of battery storage. This’ll see batteries grab 60% market share in the clean energy technology equipment sector. 1
Source: International Energy Agency, 2018
Generating electricity will remain the main use case for renewables, which is expected to account for almost 30% of global electricity demand by 2023. Hydropower is expected to be the biggest contributor, accounting for 16% of global electricity demand, followed by wind at 6%, solar at 4% and bioenergy at 3%.
The IEA says around 70% of the new power generation capacity to come online in the period up to 2023 will be powered by renewables, led by solar and followed by wind, hydropower and bioenergy.
How to take a position on renewable energy stocks
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Top 3 renewable energy stocks: RENIXX-World stocks
The Renewable Energy Industrial Index (RENIXX) is a global index that tracks the 30 largest renewable energy companies by market cap, worldwide.
Some of these companies have diverse portfolios like wind energy, solar energy, hydropower, geothermal energy, bioenergy or fuel cell technology, while others concentrate solely on one power source, such as solar.
Many of the largest players are highly cash-generative, profitable and dividend-paying, and offer relatively stable business models that benefit from reliable revenues sourced from regulated markets.
We share the top 3 renewable energy stocks in more detail below. Note that these stocks have not been chosen as the largest renewable energy shares in the world alone, but rather based on various factors including market cap, future growth prospects, dividends and latest results. This list was last updated on 20th December 2022.
Keep in mind that despite the global positive shift towards clean energy, this high growth and highly competitive industry can be volatile – resulting in drastic price swings. Keep abreast of news coverage around the sector and these companies when you’re looking to take a position, or are already holding a position on a stock.
You can take a position with us, whether the share price is rising or falling.
Tesla (497.8 billion)
US-based electric vehicle (EV) and clean energy company Tesla’s shares have disappointed in 2022. Initially, they enjoyed a great run, up 27% earlier this year. However, they now look set to finish up the year having almost halved in value (down by 49% to 157.67).
The company helmed by Elon Musk makes world class electric vehicles and associated software, including the software for fully autonomous cars. And, with fossil-fuelled vehicles set to be phased out by governments around the world over the coming years, EVs are the future.
In the third-quarter Tesla made 365,000 vehicles and shipped more than 343,000 of them. Net income more than doubled to 3.3 billion, while total sales increased by 56% to 21.5 billion (from 13.8 billion in 2021). The company’s new ‘gigafactory’ in Berlin has the capacity to produce 1,000 vehicles a week and Tesla is well-funded with 18 billion in the bank. Analysts at broker Morgan Stanley think the shares could recover to reach 330.
Musk’s purchase of social media company has weighed on Tesla shares. Investors voiced concerns that the controversial entrepreneur has been distracted from focusing on Tesla as a business, and his recent sales of Tesla shares haven’t helped matters. Musk has so far this year offloaded 23 billion of shares in the business.
However, while expensive. trading on a price earnings ratio of almost 50. the shares are off their previous highs of 414 seen in November 2021. The recent fall, while painful for investors, offers a decent entry point for those patient enough to wait out a recovery.
Verbund (14.7 billion)
Verbund, Austria’s biggest electricity producer may be worth a fraction of Tesla but packs a punch. Shares in the clean energy company had been on a seemingly unstoppable trajectory since January 2020, and have been boosted by the Europe-wide hike in wholesale electricity prices. However, the recent 21% fall in the share price to €79 looks like a buying opportunity.
The company produces 33 billion kilowatts of electricity each year from hydropower in Austria and Germany. Around two-thirds of Austria’s electricity now comes from harnessing energy from water, and Verbund supplies the majority of this in the country and Bavaria.
Hydropower increased from €60.3/MWh to €111.6/MWh during the half-year and revenues rose 170% to €7.6 billion, while pre-tax profits almost doubled to €1.1 billion.
However, Verbund’s share price was hit by uncertainty over the war in the Ukraine, subsequent volatility in the electricity markets and negative sentiment over interest rate hikes. There was also concern that European governments might launch energy profit clawbacks. Water supply also reduced by 16 percentage points and the company had to reduce its earnings forecast for the year. It now expects EBITDA (earnings before interest, tax, depreciation and amortisation) of between around €2,800 million and €3,300 million and profits of between around €1,530 million and €1,880 million.
While this is disappointing, Verbund is well placed over the longer term to benefit from the growth in renewable energy and current share price levels offer a decent entry point for investors. Meanwhile, the company is investing heavily in clean energy infrastructure across the Continent. including the hydrogen economy. and looks set to play a key part in the move towards renewable energy across Europe.
Ørsted A/S (37.2 billion)
Over 10 years the Danish company Ørsted A/S has reinvented itself from being a fossil fuel-focused energy business to a renewable energy provider. What’s more, for the past four years it has been rated the most sustainable energy company in the world by the Corporate Knights Global 100 index. Ørsted was previously heavily coal-intensive, but is now one of the world’s leading offshore wind energy providers and one of the biggest renewable energy firms by capacity across the globe.