The Best Stocks to Buy in the Renewable Energy sector
The renewable or clean energy as it is popularly called comes from resources such as solar, wind, tides, waves and geothermal heat, which can be utilized again and again. At present renewable energy contributes a mere 16% of energy requirements worldwide. On the electricity generation front only 19% comes from renewable sources.
The largest solar thermal power station and the largest geothermal power installation are located in the United States. Given the backdrop of global warming and climate change along with high oil prices, the US is taking the lead in enacting legislation, while providing incentives to make the renewable sector into a commercially viable one. All these efforts are being made to reduce greenhouses gases emissions, deemed environment unfriendly.
Best stock buys in the US renewable energy sector.
Given that this sector was better able to weather the global meltdown due to government legislation and incentives, interest is growing among the public to invest in these stocks.
NextEra Energy, Inc an electricity generation, transmission and distribution company based in Florida, and has been an early pioneer in the area of exploiting wind energy. It is also taking strides in solar power generation. The International Energy Agency has projected in its 2011 report, that in another 50 years, solar power generators would produce most of the electricity worldwide. NextEra’s stock prices are already high, but the potential for further rise is being supported by its activities.
Renewable Energy Group
Though the stock price is low at present, it has the potential to zoom as the company was undervalued in the market. REG is a major player biodiesel market and it is almost doubling its capacity in the near future. REG is also slated a quarter of the biodiesel requirements in the US in a few years.
Another strong player in the solar power sector, Sunpower is being looked at as a long term player. It saw a wild increase in its stock price in the recent past. Two factors make this stock a good buy; panel efficiency of solar power is slated to grow by 23% by 2015 and cost of production is expected to decrease by 35%.
The 3rd largest refinery in the US, this company making its presence felt in the renewable energy sector. It recently acquired 10 bio refineries making it the 3rd largest producer of Ethanol in the US. The company is betting heavily in new biofuel technologie like green fuel, which are expected to the best bets of the future.
Its main business is that of a waste service provider, but it is taking the lead in developing waste to energy technologies. It is using the garbage to produce electricity, gas and carbon sinks. It has set a achievable goal to increase renewable energy production by 67% by 2020 making it a potentially good buy.
The renewable energy sector is increasingly being perceived as a promising sector for investors, who are looking for rich dividends in the coming future. Given the activities of the players mentioned, this sector would witness great future profitability.