Best Renewable Energy Stocks to Buy in 2025

2025.10.16 2025.10.16
Best Renewable Energy Stocks: Top Clean Energy Companies to Invest in 2025

Oleg Tkachenkohttps://www.litefinance.org/blog/authors/oleg-tkachenko/

Renewable energy, or clean technology, stocks represent companies involved in generating wind, solar, hydro, and geothermal power. As the world steadily shifts away from coal, gas, and oil, demand for renewable and green energy stocks will likely accelerate.

This article explores the current state and outlook of the renewable energy market, highlighting some of the largest renewable energy companies that have demonstrated impressive long-term growth.

Major Takeaways

• Renewables made up one-third of global electricity generation in 2024.
• Although hydropower accounts for 50–55% of renewable electricity sources, it is less efficient than solar power and slower to deploy.
• Invest not only in renewable companies, but also in companies that develop clean technologies for renewable sources, build power plants, and make equipment for generating renewable energy.
• The Spanish company Iberdrola is a leader in terms of growth and upside potential, delivering a 5-year return of 50.19% and an annual dividend yield of 4.08%.
• ETFs offer a diversified alternative to individual stocks, with average gains of around 20% over the past year.

Why Invest in Renewable Energy Stocks in 2025?

Renewable energy companies are among the highly volatile types of stocks, with prices influenced by a wide range of fundamental factors. While some clean energy stocks deliver annual returns of up to 50%, the average return is around 20–25%. Moreover, the sector remains prone to periods of stagnation that can last for more than a year.

Potential risks:

• Changes in the scope of government support. For example, this may include financing green energy projects and shutting down coal-fired power plants or, conversely, supporting the coal industry at the expense of renewable energy development.
• Weather hazards. Wind and solar power generation can fluctuate with weather conditions, and a drop in output may negatively affect share prices.
• Competition from nuclear power plants. Although nuclear power plants are more expensive to build, electricity generation is significantly cheaper.
• Technology risks. New energy generation technologies may appear before existing facilities recoup their costs.

Carbon-free energy is a high-risk asset that may skyrocket in the future but could also prove unprofitable.

How to Evaluate and Choose Renewable Energy Companies

How to invest in stocks? The standard approach involves analyzing a company’s financial statements by evaluating net profit and revenue growth, debt levels, profitability ratios, and valuation multiples. These metrics are then compared with those of other companies.

• Pay attention to short-term and long-term returns. If a company is in the black in the short and long term, it will likely remain profitable for at least 1–2 years.
• Companies that vertically integrate have an advantage. Those that own their own generation capacity, power grids, and infrastructure for storing and delivering energy to end users are generally more stable and resilient.
• Identify who the end users are. Companies with large government contracts enjoy a strong competitive edge.
• Prioritize blue-chip stocks.

Stocks in related sectors can be an alternative to renewable energy shares. For example, manufacturers of lithium batteries for energy storage and solar panels.

Key Financial Metrics for Clean Energy Stocks

The same metrics used for other companies apply when analyzing renewable energy stocks:

• EBITDA.
• P/E (Price-to-Earnings), P/B (Price-to-Book).
• ROE, ROI.
• Revenue, net income.
• Dividend stability.
• Debt/EBITDA.

Indicator values can be found on financial analytics websites, where they are compared over several quarters.

Technology and Market Position Analysis

According to the International Energy Agency (IEA), renewable energy sources accounted for roughly one-third of global electricity generation in 2024. Hydropower contributed around 14% of total generation, while wind and solar accounted for 8% and 7%, respectively. Nuclear energy, though not classified as renewable, generated around 9%. The remaining 60% of electricity was produced from fossil fuels, including coal, gas, and oil.

India and China rank among the lowest in environmental sustainability, as their power plants rely mainly on coal.

Europe made significant progress in renewable energy use in 2024. According to Ember, in June 2025, solar power accounted for the largest share of electricity generation (22.1%), followed by nuclear energy (21.8%) and wind power (15.8%). The share of coal declined sharply, largely due to a shift toward natural gas, which is considered more environmentally friendly.

Renewable energy sources ranked by share in global electricity generation:

• Hydropower (50–55%).
• Wind power (25–30%).
• Solar power (20–25%).
• Biomass energy (up to 5%).
• Geothermal energy (1–3%).

Although hydropower currently dominates global renewable electricity generation, solar energy is expected to take the lead by 2050, according to the International Renewable Energy Agency (IRENA). Solar power has already surpassed hydropower in terms of total capacity, accounting for 42% of total installed renewable capacity at the beginning of 2025, compared with 29% for hydropower. In 2024 alone, the number of new solar power stations grew by 32.2%, while hydropower expanded by just 1.2%.

Notably, hydroelectric plants operate around the clock, while solar facilities generate power only during daylight hours. As a result, even though solar energy is ahead in terms of capacity, hydropower still produces a greater share of actual electricity output. However, most large hydropower plants have already been built, and further expansion in this sector is limited by geographical and environmental constraints.

To remain competitive, green energy companies have not yet entirely abandoned other energy sources such as coal, gas, and oil. However, the energy mix is steadily shifting toward cleaner alternatives. The share of coal-fired power plants is gradually declining in favor of renewables and nuclear energy.

Best Renewable Energy Stocks to Buy Now

The list includes renewable and green energy stocks that meet the following criteria:

• More than 60% of the company’s generating capacity comes from renewable sources, reflecting a steady shift away from coal. Limited use of nuclear power is acceptable.
• The company has shown positive stock performance over both 1-year and 5-year periods, indicating stable growth and sustained investor interest.
• The company is a regional leader with assets, representative offices, or equity stakes in other countries.

Long-term investors can also benefit from the relatively high dividends offered by some clean energy companies.

Top renewable energy companies:

Iberdrola S.A. (IBE)

Country: Spain.

Market cap: €104.43 billion.

5-Year Return: +50.19%, 1-Year Return: +16.09% (as of 15.09.2025).

Annual Dividend Yield: 4.08% or €0.64 per share.

Iberdrola is one of the world’s largest companies in the renewable energy sector, ranked among the top five in terms of market capitalization in its segment. It is the biggest operator of wind farms globally.

Main business areas:

• Generation and supply of electricity. Iberdrola is a major producer of renewable energy, including wind (onshore and offshore wind turbines), hydro, and solar energy. It also operates gas and conventional power plants.
• Grids. The company manages electricity distribution networks and transmission lines across several regions.
• Energy services and retail. The company supplies electricity and gas to end consumers in Spain (42.4%), the United Kingdom (18.1%), Brazil (15.9%), the United States (14.6%), Mexico (7.5%), and other countries.

By mid-2025, renewable energy accounted for about 79% of the company’s total generating capacity, or 84% including nuclear power. According to the company’s website, its greenhouse gas emissions have fallen by more than 30% over the past five years.

Enel (ENEL)

Country: Italy.

Market cap: €79.90 billion.

5-Year Return: +5.92%, 1-Year Return: +10.22% (as of 15.09.2025).

Annual Dividend Yield: 5.98% or €0.48 per share.

Enel is a multinational energy company and one of the world’s largest producers and distributors of electricity, with operations across Europe, the United States, and Africa.

Main business areas:

• Power generation. The company’s total installed capacity exceeds 88 GW, about 60% of which comes from renewable sources, such as wind, solar, hydro, and geothermal energy.
• Grids. Enel is one of the leading electricity distribution operators in Europe and North America.
• Retail. The company sells electricity and gas to private and corporate customers in various countries.
• Enel Green Power is a subsidiary that develops renewable energy projects.

About 55 GW of the 88 GW comes from renewable energy: around 30% from hydropower, 17% from wind power, and 7% from solar power. Nuclear energy and coal/fuel oil account for 12% and 9%, respectively. The company aims to eliminate coal use entirely by 2040.

Ormat Technologies (ORA)

Country: US.

Market cap: $5.59 billion.

5-Year Return: +66.47%, 1-Year Return: +22.82% (as of 15.09.2025).

Annual Dividend Yield: 0.52% or $0.48 per share.

Ormat Technologies specializes in the engineering, construction, and operation of geothermal power plants and renewable energy solutions. The company has production facilities in Israel, among other locations, where it is also listed on the regional stock exchange.

Main business areas:

• Geothermal energy. Ormat Technologies designs and operates geothermal power plants around the world ( the US, Kenya, Indonesia, Guatemala, etc.).
• The company converts industrial heat emissions into electricity.
• Hybrid power generation. The company integrates geothermal and solar energy to increase efficiency.
• Construction of generating facilities and the production of components. The company has built more than 200 power stations and supplies turbines, turbochargers, generators, and heat exchangers.

Ormat Technologies owns and operates more than 1.2 GW of installed capacity, most of which comes from geothermal power plants.

GE Vernova (GEV)

Country: US.

Market cap: $171.74 billion.

18-month return: +359.02%, 1-Year Return: +173.00% (as of 15.09.2025).

Annual Dividend Yield: 0.16% or $1.00 per share.

In spring 2024, General Electric, which had existed since 1878, was split into three independent companies: GE Aerospace (aircraft engines), GE Vernova (energy equipment), and GE HealthCare (medical equipment).

GE Vernova’s main business areas:

• Manufacture of gas, steam, hydroelectric, and nuclear turbines.
• Development, production, and installation of wind power equipment, including onshore and offshore turbines and blade manufacturing.
• Development of power grid systems, energy storage solutions, and software for managing energy networks, including advanced battery storage and energy storage products.

GE Vernova is an engineering and technology company that designs and supplies equipment, but does not operate energy networks or produce electricity. The recent separation from General Electric and a stronger focus on developing renewable technologies have improved operating efficiency and created potential for share-price growth.

Enlight Renewable Energy (ENLT)

Country: Israel.

Market cap: 12.60 billion ILS (around $3,78 billion).

5-Year Return: +60.60%, 1-Year Return: +64.13% (as of 15.09.2025).

The company does not pay dividends.

Enlight Renewable Energy is an international company operating in the renewable energy industry. It is headquartered in Ramat Gan, Israel, and has offices in Europe and the US.

Main business areas:

• Solar power. Construction and operation of large solar parks.
• Wind power. Development of onshore wind farm projects.

It is a vertically integrated company that manages every stage of production, from land acquisition and project design to construction, grid connection, and operation.

Best Renewable Energy ETFs for Diversified Investment

ETFs are exchange-traded funds that offer a ready-made, diversified portfolio managed by professionals for a relatively low fee. They are suitable for long-term renewable energy investments and are often associated with socially responsible investing. While their returns may be lower than those of individual stocks, ETFs carry less risk thanks to diversification.

iShares Global Clean Energy ETF (ICLN)

Over the past year, the iShares Global Clean Energy ETF has returned 33.51%, with a management fee of 0.39%. The fund surged in 2020, tripling in value due to increasing investor interest and strong government support for renewable energy. Although the fund experienced a gradual decline afterward, it is currently trading near its lowest levels, signaling a potential upward reversal and a great time to invest. The ETF comprises over 100 securities, with First Solar Inc. holding the largest share of 9.16% and Iberdrola S.A. ranking only fourth with a share of 5.40%.

SPDR Kensho Clean Power ETF (CNRG)

The SPDR Kensho Clean Power ETF has delivered a 1-year return of about 20%. However, the company’s long-term performance has been weaker, with losses over the past three years and a modest 5-year gain of only 2.7%. The ETF tracks the S&P Kensho Clean Power Index, which includes companies involved in the development of renewable energy technologies.

VanEck Low Carbon Energy ETF (SMOG)

1-Year Return: 25.08%.

The ETF includes companies operating in the following areas:

• Wind, solar, hydro, green hydrogen, biofuel, and geothermal energy.
• Lithium-ion batteries, electric vehicles, and related equipment.
• Waste-to-energy technologies.
• Construction or industrial materials that reduce carbon emissions or energy consumption.

The most popular companies in the ETF include Tesla Inc. (9.22%), NextEra Energy Inc. (7.0%), Iberdrola S.A. (6.21%), Enel SpA (5.85%), BYD Co. Ltd. (4.38%), and First Solar Inc. (4.20%).

Conclusion

Companies in Europe and the US are trying to gradually abandon coal, gas, and oil as energy sources. However, this process will take 10–25 years, limiting the potential of green energy sources.

The main competitor of renewable energy sources is nuclear energy.

There is a growing demand for electricity in the technology sector. As more countries look for sustainable energy sources and aim to reduce environmental pollution, renewable energy shows strong long-term potential. In contrast, nuclear power is losing ground due to challenges associated with nuclear waste disposal.

Many green energy stocks depend on government support. Therefore, if funding is cut, companies may suffer losses in the long term. When choosing an asset, pay attention to the level of business diversification and vertical integration.