When investing, you must have the right ideas. By identifying and following age-old themes, you participate in an industry where a rising tide lifts all boats. When the key trend plays in your favor, you get natural coverage against company-specific risks.
Clean energy is one of those age-old themes. Nor is it always true that you can do good for humanity while making the best decision for your wallet. Human beings are interested and companies need to allocate capital as efficiently as possible.
Previously, there was so much consumption of fossil fuels in the world because it was the most cost-effective method of generating electricity. Now the narrative has shifted. It is much more efficient and cost effective on a unit economic basis to produce a unit of solar energy rather than using traditional fossil fuel sources. It’s not just some kind of science project anymore: you can’t fight the numbers.
There is a saying in the renewable energy industry that “the sun doesn’t always shine and the wind doesn’t always blow”, which refers to the so-called intermittency problem. However, we have now found a solution to this: battery technology. Take lithium-ion batteries. Using one to power a home cost $75,000 in the 1990s, and they weighed 250 pounds (lb). In 2021, the cost is $2,000 and they weigh 88 lbs.
We have to find ways to exploit this opportunity, and solar energy is excellent in this regard. The following three stocks are industry leaders. They are the drivers of the cost optimization that makes solar energy such an attractive alternative to traditional fossil energy.
Solar power has a key role to play in the fight against climate change, as replacing most fossil fuel sources today with solar power is one of the only ways to achieve our climate goals. . The allocation of capital to these innovators is critical to our success.
A key player in photovoltaics
First Solar (Nasdaq: FSLR) is a global solar technology company that manufactures and sells photovoltaic (PV) panels featuring advanced thin-film semiconductor technology providing a high-performance, low-carbon alternative to conventional crystalline silicon PV solar modules. The company currently operates several of the largest grid-connected photovoltaic power plants in the world. It displays an impressive attention to detail in all areas, from the source of raw materials to the finished product. Enphase Energy (Nasdaq:ENPH) provides easy-to-use smart solutions to manage solar generation, storage and communication on a single platform.
Enphase was founded in 2006 and revolutionized the solar industry with its microinverter technology. It has evolved to produce a fully integrated solar plus storage solution. SolarEdge Technologies (Nasdaq:SEDG) also facilitates the race for the globalization of solar energy.
The company provides smart energy to individuals and businesses. Solar Edge is a leading provider of inverter solutions that optimize the way energy is harvested and managed in photovoltaic systems. The Company’s DC Inverter Maximizes Electricity Generation at the Individual PV Module Level While Lowering the Cost of Power Generated by the PV System