12 Solar Energy Stocks Billionaires Are Piling Into

Published on December 12, 2023 at 12:50 pm by Ramish Cheema in Hedge Funds, News

In this piece, we will take a look at the 12 solar energy stocks that billionaires are piling into. If you want to skip our overview of the solar energy industry and the latest trends, then check out 5 Solar Energy Stocks That Billionaires Are Piling Into.

The solar energy industry is one of the most important when it comes to reducing global emissions. Solar panels convert the Sun’s energy into electricity, providing humanity with a limitless source of energy. Naturally, this means that the industry itself is quite lucrative. Market research shows that the renewable energy industry as a whole was worth $881 billion in 2020 and is expected to grow at a compounded annual growth rate (CAGR) of 8.4% until 2030 to have a final value of $2 trillion.

As is the case with oil, solar power generation is also dominated by a handful of countries. Solar power production requires hefty investment into solar panels, batteries, and associated products. Additionally, while solar power provides free energy if the investment costs in the equipment are ignored, its very nature makes it unfeasible as a complete alternative to fossil fuels. This is because fossil fuel power plants can run 24/7, while solar panels are limited to generating power during the day only. As a result, solar panels cannot provide adequate baseload power particularly at night time and during high energy usage periods such as summer seasons. Therefore, it has to be paired up with other sources to ensure there are no power outages.

Developments in solar power are taking place primarily in the developed world due to aggressive emissions targets. For instance, the U.S. is expected to expand its solar energy production by 32 gigawatts by 2023 in a positive development for the industry. This is because the 2022 Russian invasion of Ukraine was one of the most serious crises that the conventional energy sector had to deal with, particularly in the aftermath of the coronavirus pandemic that had sapped demand for fossil fuels due to lockdowns. Following the invasion, global oil prices shot up due to supply disruptions, and in a blow for solar, this also led to a drop in investments in solar energy. So, the 32 GW U.S. added solar energy production in 2023, which marks a 52% annual growth came after 13% contraction in the sector in the previous year, showing that the focus was reorienting itself towards going green.

Another key incentive for solar power in America has been the Biden-Harris Administration’s Inflation Reduction Act (IRA). The IRA is a sweeping set of reforms that earmarks billions of dollars in incentives for both firms and consumers to reshape their energy production and consumption habits. Its scope and scale have also led reports to predict that from the 32 GW of solar production in 2023, America’s solar power output will rise to 375 GW in 2028 from 153 GW as of November 2023.

Shifting gears to focus on solar power companies, they are primarily made of firms that generate solar energy and those that make the panels and other equipment. Starting from the former, we took a look at the 10 Biggest Solar Companies In The World in terms of their installed capacity as of 2019. The data shows that the three biggest solar power companies in the world were Adani Renewables, GCL, and SB Energy. Combined their installed energy capacity stood at roughly 28,000 megawatts.

However, moves in the solar space are not limited only to established industry players. Big tech has also been making waves, particularly due to the onset of cloud and data center computing. Data centers use large amounts of electricity and they add to the carbon footprint of their operators – which incentivizes firms such as Apple Inc. (NASDAQ:AAPL) and Microsoft Corporation (NASDAQ:MSFT) to go green. Another tech mega cap that’s making moves in the industry is Amazon.com, Inc. (NASDAQ:AMZN). The firm announced a cool 39 renewable energy projects in Europe in October 2023, adding to its already impressive portfolio of 160 projects in the continent. Through these projects, the global retail behemoth aims to generate 5.8 GW of renewable energy, through projects that it claims create €2.4 billion in investment opportunities and thousands of jobs.

Looking at this, it’s clear that solar power is here to stay. So, we decided to look at which solar companies billionaires are buying, out of which some top picks are NextEra Energy, Inc. (NYSE:NEE), Tesla, Inc. (NASDAQ:TSLA), and First Solar, Inc. (NASDAQ:FSLR).

A construction crew working on a solar energy system, revealing the company’s drive for success.

Our Methodology

To make our list of the solar energy stocks that billionaires are piling into, we ranked the 30 biggest solar companies in the world in terms of their market capitalization by the number of billionaire owned or led hedge funds that had bought the shares in Q3 2023.