The future of President Joe Biden’s landmark climate legislation, the Inflation Reduction Act (IRA) plays a significant role in promoting renewable energy by offering a wide range of tax incentives and funding mechanisms to encourage investment in clean energy technologies, including solar, wind, and geothermal power, hangs in the balance as the incoming Republican-controlled White House, Senate, and House of Representatives prepare to take office in 2025.
However, an area of concern is the future of the Department of Energy’s Loan Programs Office (LPO), which provides financing for green energy projects. The LPO has been instrumental in funding large-scale renewable energy projects and it expanded significantly under the IRA. However, Trump’s appointees, particularly Wright, who has expressed skepticism about the climate crisis, may be inclined to scale back or dismantle this program entirely, which could have a significant impact on the green energy sector.
Read Also: 12 Best Technology Penny Stocks To Buy According to Hedge Funds and 12 Best Energy Stocks To Invest In Now.
Renewables as the Key to Meeting Rising Demand
In an interview with Bloomberg on December 23, Tom Steyer, Co-Founder of Galvanize Climate Solutions, a climate-focused global investment firm, discussed the role of renewable energy in the United States. Steyer emphasized that while the year 2025 is often discussed in the context of climate regulations, it is more accurately about meeting the growing energy demand. He argued that renewable energy should be at the center of any energy bill, regardless of political persuasion. Steyer highlighted that market costs are the primary drivers of the energy transition to renewables. He cited the fact that in 2023, 86% of new electricity generation was predominantly from renewable sources, driven by economic rather than purely environmental considerations.
Steyer pointed out that the phrase “drill, baby, drill” might still be part of the political conversation, but the cost differential between renewable and fossil fuels drives the reality. He noted that renewables are now cheaper than fossil fuels and are becoming increasingly cost-effective. For instance, the cost of natural gas in the U.S. has risen to nearly double its previous levels, while in Europe, it is even higher. However, the cheapest electricity is increasingly coming from renewable sources, both in the U.S. and globally. This economic reality is driving business decisions, international competitiveness, and national security by industries such as tech, that require large amounts of electricity and are increasingly turning to renewables to meet their energy needs.
When asked about the potential impact of deregulation in the energy sector, Steyer suggested that deregulation could help accelerate the adoption of renewables if it includes faster permitting and lower oversight for all energy projects, including renewables. He noted that the Trump administration’s push for faster permits and reduced oversight for oil and gas drilling could extended to renewables, and will lead to a significant expansion of low-cost, abundant renewable energy.
Regarding nuclear energy, Steyer acknowledged its potential but noted the challenges associated with cost, safety, and public perception. He pointed out that nuclear energy has historically been expensive, with the last nuclear plant in Georgia costing at least four times its original estimate. While nuclear energy could provide a stable baseload power source, the high costs and safety concerns have made it a less attractive option compared to renewables.
As the United States enters 2025, the future of the Inflation Reduction Act (IRA) remains uncertain under a Republican government. However, the cost-effectiveness of renewable energy compared to fossil fuels makes it increasingly dominant in the global energy mix. With that in context, let’s take a look at the 11 best renewable energy stocks to buy now.
Our Methodology
To compile our list of the 11 best renewable energy stocks to buy now, we used clean energy ETFs plus online rankings to compile an initial list of 25 renewable energy stocks. We then used Insider Monkey’s Hedge Fund database to rank 11 stocks according to the largest number of hedge fund holders, as of Q3 2024. The list is sorted in ascending order of hedge fund sentiment.
Why do we care about what hedge funds do? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
11 Best Renewable Energy Stocks To Buy Now
11. Sunnova Energy International Inc. (NYSE:NOVA)
Number of Hedge Fund Investors: 22
Sunnova Energy International Inc. (NYSE:NOVA) is a residential solar and energy storage service provider. The company offers solar panel installation, battery storage, and energy management solutions to homeowners across the U.S. and its territories. Sunnova Energy International Inc. (NYSE:NOVA) serves over 420,000 customers and primarily generates revenue through long-term service agreements, including power purchase agreements (PPAs) and solar leases.
Sunnova Energy International Inc. (NYSE:NOVA) is focusing on optimizing cash generation and capital efficiency, which are critical for sustaining its growth and expanding its market presence. The company has made significant strides in this area by refining its capital markets strategies and increasing the utilization of investment tax credits (ITC). The company aims to increase its weighted average ITC rate by instituting a requirement for all new lease and power purchase agreement (PPA) systems to meet domestic content standards. Furthermore, the company is actively working with its dealer network to flip its existing uninstalled systems to domestic content systems to further capture ITC benefits.
Sunnova Energy International Inc. (NYSE:NOVA) is leveraging its robust dealer network to attract and serve new customers. The company is providing its dealers with a best-in-class platform, including advanced software and comprehensive customer service, to ensure they have the tools and support needed to succeed.
10. Shoals Technologies Group, Inc. (NASDAQ:SHLS)
Number of Hedge Fund Investors: 27
Shoals Technologies Group, Inc. (NASDAQ:SHLS) specializes in electrical balance of system (EBOS) solutions for solar energy projects. The company provides essential components such as combiner boxes, inline fuses, and wire harnesses, which are crucial for solar power generation systems. Shoals Technologies Group, Inc. (NASDAQ:SHLS) has established itself as a major player in the utility-scale solar market by offering a comprehensive range of products and services that improve the efficiency, reliability, and cost-effectiveness of solar installations.
Shoals Technologies Group, Inc. (NASDAQ:SHLS) is focusing on building and strengthening relationships with existing and new customers. The company has signed multiple new EPC (Engineering, Procurement, and Construction) customers and is winning back wallet share with others. For instance, four EPC customers that contributed less than $1 million in combined revenue in 2023 have already driven $25 million in revenue in 2024, with a combined four gigawatts in backlog and awarded orders.
Shoals Technologies Group, Inc. (NASDAQ:SHLS) is committed to improving operational efficiency and flexibility. The company is investing in a new consolidated factory, which will streamline operations and enhance its lean and agile capabilities. This facility will enable the company to better manage costs, improve product quality, and respond quickly to customer needs. Additionally, Shoals Technologies Group, Inc. (NASDAQ:SHLS) is focusing on optimizing its balance sheet to maximize financial flexibility and position itself to seize new opportunities as they arise.
Shoals Technologies Group, Inc. (NASDAQ:SHLS) is also advancing its 2kV electrical systems, which are designed to increase the voltage in solar projects to 2,000 volts. This innovation is expected to significantly enhance the efficiency, sustainability, and cost-effectiveness of solar installations. The company has initiated pilot programs with industry leaders such as GE Vernova to test and refine this technology.
9. Clearway Energy, Inc. (NYSE:CWEN)
Number of Hedge Fund Investors: 29
Clearway Energy, Inc. (NYSE:CWEN) is a renewable energy company engaged in the development, ownership, and operation of renewable energy generation facilities. The company’s portfolio includes 11.4 GW of gross generating capacity across 26 states, with 9 GW of assets in wind, solar, and battery energy storage.
Clearway Energy, Inc. (NYSE:CWEN) is making substantial progress in expanding its renewable energy portfolio. The company recently entered into a binding agreement to acquire the 137 MW Tuolumne Wind Project from Turlock Irrigation District, located in Klickitat County, Washington. The acquisition is expected to close in the first quarter of 2025 and will sell power under a new 15-year Power Purchase Agreement (PPA) with Turlock Irrigation District, and is forecasted to provide incremental annual levered asset Cash Available for Distribution (CAFD) on a five-year average basis of approximately $9 million beginning January 1, 2026.
Clearway Energy, Inc. (NYSE:CWEN) is also investing in the Pine Forest Solar and Storage Project. Located in the rapidly growing ERCOT (Electric Reliability Council of Texas) power market, this project strategically enhances the company’s portfolio. The solar capacity of the Pine Forest project is fully contracted for an average of around 20 years, with most of the contracts secured with prominent information technology companies.
8. Nextracker Inc. (NASDAQ:NXT)
Number of Hedge Fund Investors: 32
Nextracker Inc. (NASDAQ:NXT) is a prominent provider of solar tracker and software solutions designed for utility-scale and ground-mounted solar power plants. The company’s advanced tracking systems optimize the positioning of solar panels to maximize energy output throughout the day. Nextracker Inc. (NASDAQ:NXT) primarily serves large-scale solar energy developers and independent power producers.
Nextracker Inc. (NASDAQ:NXT) is diversifying its product portfolio to address a broader range of customer needs. The company has recently launched several new products, including the NX Horizon, NXTR 1.5, NX Horizon Low Carbon Tracker, and NX Hail Pro-75, which have been successfully deployed in the field. These products are designed to offer superior performance, reliability, and cost-effectiveness, making them highly attractive to international customers. Additionally, Nextracker Inc. (NASDAQ:NXT) is offering a comprehensive suite of products and solutions. The company’s Foundation Solutions business, which provides specialized foundation technologies for challenging terrains is also gaining traction in markets where traditional installation methods are not feasible.
Nextracker Inc. (NASDAQ:NXT) is actively expanding its business internationally to tap into the growing demand for solar energy solutions across various regions. One of the key strategies driving this expansion is the company’s focus on localized product development and manufacturing. The company has established a state-of-the-art Center of Solar Excellence in Hyderabad, India, which serves as a global design facility and incubator for PV technologies tailored to regional needs. This facility will also support other markets in the Asia-Pacific region with products that are optimized for local conditions.
7. Array Technologies, Inc. (NASDAQ:ARRY)
Number of Hedge Fund Investors: 36
Array Technologies, Inc. (NASDAQ:ARRY) specializes in solar tracking systems designed to enhance the efficiency of solar energy projects. The company’s flagship products, including the DuraTrack and OmniTrack series, are designed to maximize energy production and minimize operational risks, making them ideal for a wide range of terrains and climates. Array Technologies, Inc. (NASDAQ:ARRY) generates revenue through hardware sales and post-installation services, serving utility-scale solar developers and independent power producers.
Array Technologies, Inc. (NASDAQ:ARRY) is committed to continuous innovation, as evidenced by the recent introduction of the 77-degree tracker, which features the steepest stow angle in the industry for protection against hail damage. This product, along with the SkyLink architecture and automated snow response solutions addresses the unique challenges faced by solar sites, such as extreme weather conditions. The company is also working on a robust pipeline of upcoming products, including the automated snow response system.
While the U.S. market remains a core focus, Array Technologies, Inc. (NASDAQ:ARRY) is actively expanding its international footprint. The company has increased its investments in sales and marketing to strengthen its foothold and drive additional business opportunities in these regions. In Brazil, the company has achieved a leading market share in distributed generation, demonstrating its ability to adapt to diverse market conditions. In Europe, despite modest market demand, Array Technologies, Inc. (NASDAQ:ARRY) is confident in its targeted customer activities and is poised for share growth in the coming quarters.
6. Enphase Energy, Inc. (NASDAQ:ENPH)
Number of Hedge Fund Investors: 38
Enphase Energy, Inc. (NASDAQ:ENPH) is a global energy technology company known for solar microinverter systems, which convert solar energy into usable electricity. The company also provides energy storage solutions and monitoring software designed for residential and commercial solar installations. Enphase Energy, Inc. (NASDAQ:ENPH) generates revenue through both product sales and subscription-based services.
Enphase Energy, Inc. (NASDAQ:ENPH) is aggressively expanding its product portfolio to address a broader range of market needs. The company has introduced the IQ9 microinverter, powered by Gallium Nitride (GaN) technology, which supports higher DC input currents and elevated AC grid voltages, making it suitable for small commercial markets. This new product line is expected to launch in the second half of 2025 and aims to capture emerging market demands and further penetrate the commercial sector. Additionally, Enphase Energy, Inc. (NASDAQ:ENPH) is rolling out its fourth-generation battery system, which is designed to significantly reduce installation costs and wall space, making it highly competitive for both grid-tied and backup applications. The company is also expanding its presence in key international markets, such as Japan, India, and Brazil, by launching products tailored to local needs and regulatory requirements.
In the United States, Enphase Energy, Inc. (NASDAQ:ENPH) is focusing on leveraging the benefits of the Inflation Reduction Act (IRA) to strengthen its market position. The company is introducing higher domestic content SKUs for its IQ8HC microinverters and IQ8P three-phase microinverters to enable commercial asset owners to qualify for a 10% domestic content Investment Tax Credit (ITC). This strategic move is expected to drive demand and increase the competitiveness of the company’s products in the US market.
5. Sunrun Inc. (NASDAQ:RUN)
Number of Hedge Fund Investors: 43
Sunrun Inc. (NASDAQ:RUN) is one of the largest residential solar and battery storage companies in the United States. The company specializes in solar panel installations, energy storage systems, and energy services, offering these through long-term subscription-based leases, power purchase agreements (PPAs), and direct sales.
Sunrun Inc. (NASDAQ:RUN) is focusing on expanding its network of strategic partnerships to integrate residential solar energy systems with the broader electric grid, turning homes into smart, controllable load resources. The company has launched 16 grid service programs across the country, with over 20,000 customers participating. One of the most notable recent partnerships is with Orange and Rockland Utilities (O&R), a subsidiary of Consolidated Edison, Inc. Together, they have successfully activated New York’s largest residential power plant, a distributed energy system using over 300 solar-plus-storage systems. Sunrun Inc. (NASDAQ:RUN) is also expanding its reach by offering free or heavily discounted home batteries to customers participating in the 10-year program.
Sunrun Inc. (NASDAQ:RUN) is investing in new technologies and services to stay at the forefront of innovation. The company is developing advanced battery storage solutions, smart grid management tools, and integrated energy management platforms. These technologies not only improve the efficiency and reliability of its systems but also enhance the user experience by making energy management more intuitive and accessible. For instance, the company’s virtual power plants are equipped with sophisticated software that optimizes energy usage and distribution, ensuring that stored solar power is used effectively during peak demand times.
4. First Solar, Inc. (NASDAQ:FSLR)
Number of Hedge Fund Investors: 59
First Solar, Inc. (NASDAQ:FSLR) is a leading manufacturer of thin-film solar modules, primarily designed for utility-scale solar projects. The company’s advanced photovoltaic technology offers high energy efficiency and exceptional durability. First Solar, Inc. (NASDAQ:FSLR) generates revenue through the sale of solar modules, the development of solar power plants, and the provision of operations and maintenance services. Its customer base includes utility-scale project developers, power plant owners, and government organizations.
First Solar, Inc. (NASDAQ:FSLR) is taking proactive steps to protect its intellectual property and differentiate itself in a highly competitive market. The company possesses a robust TOPCon patent portfolio, which it has begun to leverage through outreach to various solar manufacturers, notifying them of potential infringement issues and reserving its rights. By securing and enforcing its intellectual property rights, First Solar, Inc. (NASDAQ:FSLR) aims to safeguard its competitive advantage and ensure that its unique value proposition is recognized and respected by all market participants.
First Solar, Inc. (NASDAQ:FSLR) is also focusing on expanding its technological capabilities and manufacturing capacity to achieve its goal of surpassing 14 gigawatts of annual U.S. capacity and over 25 gigawatts of global capacity by 2026. The company is advancing its perovskite technology through a new development line in Perrysburg, Ohio. This initiative aims to replicate in-line manufacturing conditions and expedite the commercialization of this innovative technology. First Solar, Inc. (NASDAQ:FSLR) recently opened its $1.1 billion Alabama facility, which will contribute an additional 3.5 gigawatts of vertically integrated solar manufacturing capacity once fully operational. Furthermore, the company remains on schedule to launch operations at its Louisiana facility in the second half of 2025.
3. NextEra Energy Inc. (NYSE:NEE)
Number of Hedge Fund Investors: 69
NextEra Energy Inc. (NYSE:NEE) is an electric utility company and a global leader in renewable energy, specializing in wind and solar power generation. The company operates through its subsidiaries, including Florida Power & Light and NextEra Energy Resources.
NextEra Energy Inc. (NYSE:NEE) is leveraging its expertise in developing renewable energy projects to collaborate with other utility companies and expand its footprint to meet the growing demand for clean, sustainable power. The company recently collaborated with Salt River Project (SRP), a leading utility in Arizona, to complete the Babbitt Ranch Energy Center, a 161-megawatt (MW) wind project located in Coconino County, Arizona. The clean energy produced by the Babbitt Ranch Energy Center will be fully allocated to Google’s future data center in Mesa, Arizona, supporting the tech giant’s commitment to 24/7 carbon-free energy.
NextEra Energy Inc. (NYSE:NEE) is also actively expanding its renewable energy portfolio through a partnership with Phillips 66 to power its refinery in Rodeo, California, with a new solar facility. This 30.2-megawatt solar plant drives the creation of new renewable assets, scheduled to begin operations in January 2025, and will be constructed on 88 acres of land adjacent to Phillips 66’s renewable fuels facility in the San Francisco Bay Area. Moving forward, NextEra Energy Inc. (NYSE:NEE) has announced incremental framework agreements with two Fortune 50 customers for the development of renewable and storage projects, with a combined capacity of up to 10.5 gigawatts by 2030.
2. Constellation Energy Corporation (NASDAQ:CEG)
Number of Hedge Fund Investors: 78
Constellation Energy Corporation (NASDAQ:CEG) is a prominent energy provider in the United States, specializing in power generation, wholesale energy sales, and retail energy supply. The company manages a diverse energy portfolio, including nuclear, solar, wind, and natural gas facilities. Constellation Energy Corporation (NASDAQ:CEG) owns and operates one of the largest solar power facilities in the United States, boasting a total generation capacity of 242 megawatts along with 27 wind projects across 10 states with a capacity of about 1400 MW of electricity.
Constellation Energy Corporation (NASDAQ:CEG) is leveraging its expertise in renewable energy by offering innovative solutions that enable data centers and other companies to operate using clean and reliable energy sources. One of the company’s most in-demand offerings is its offsite renewables product, CORe, which facilitates location-specific renewable energy purchases and provides renewable energy certificates (RECs) tailored to match customers’ specific energy consumption needs. For example, Constellation Energy Corporation (NASDAQ:CEG) recently announced a partnership with W. L. Gore & Associates on a 55-megawatt (MW) renewable energy project. Under a 20-year agreement, W. L. Gore & Associates will procure approximately 110,000 MWh of energy annually and receive energy and renewable energy certificates (RECs) from Constellation Energy Corporation’s (NASDAQ:CEG) Glover Creek Solar Project in Metcalfe County, Kentucky.
By offering long-term agreements to businesses, Constellation Energy Corporation (NASDAQ:CEG) aims to ensure a stable revenue stream while supporting these organizations in achieving their carbon reduction goals. Moreover, The CORe products support the company in building strategic partnerships and collaborations to expedite the growth and deployment of solar energy projects with utilities, state governments, and other companies.
1. Vistra Corp. (NYSE:VST)
Number of Hedge Fund Investors: 97
Vistra Corp. (NYSE:VST) is a leading integrated retail and power generation company based in Irving, Texas. The company’s operations span from traditional power generation to cutting-edge renewable energy and energy storage technologies. Vistra Corp. (NYSE:VST) operates across power generation, energy retail, and infrastructure services.
Vistra Corp. (NYSE:VST) is conducting a methodical, site-by-site analysis of its coal fleet and is determining the economic feasibility of transitioning these sites to less carbon-intensive generation. The company is making substantial progress on Coal to Solar and Energy Storage initiatives and recently announced new utility-scale solar projects in Illinois to the grid. These projects, including a 68-MW solar facility and a 2-MW/8-MWh energy storage system at the Baldwin Power Plant site, will produce approximately 140,000 MWh of zero-carbon electricity annually over the next 20 years. Vistra Corp. (NYSE:VST) is also constructing a 40-MW utility-scale solar facility that will interconnect at the company’s EEI-Joppa Power Plant through an approximately 8-mile transmission line.
Furthermore, Vistra Corp. (NYSE:VST) is actively expanding its renewable energy portfolio to meet the growing demand for sustainable power solutions while ensuring grid reliability and affordability. The company is constructing a 52-MW solar and 2-MW/8-MWh energy storage facility at the Newton Power Plant is set to begin in 2025.
While we acknowledge the potential of Vistra Corp. (NYSE:VST) to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than VST but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock.
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