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Invest in renewable energy stocks
Start here if you want to buy shares in sustainable energy companies in Australia.
Renewable energy stocks have been investors' favourites in recent years.
As the world moves towards sustainability, renewable energy is becoming a major priority of governments and businesses around the world. For countries such as Australia, China and India where electricity is largely generated from high carbon-emitting coal, many see the future of renewable energy as critical.
If you're looking to invest in companies that support the growth of sustainable energy sources, you can start here.
How do I buy renewable energy stocks?
- Choose a share trading platform. If you're a beginner, our table below can help you choose.
- Open your account. You'll need your ID, bank details and tax file number (TFN).
- Confirm your payment details. You'll need to fund your account with a bank transfer, debit card or credit card.
- Find the shares you want to buy. Search the platform and buy your shares. It's that simple.
Why invest in renewable energy?
In the last century, we've come to rely on fossil fuels to create electricity, power our vehicles and drive manufacturing. But overwhelming evidence says the extraction and use of coal, oil and gas are causing irreversible environmental damage and global warming. Fossil fuels are also finite – over time, we'll be forced to rely on alternative energy sources regardless of our environmental views. This is driving investors towards renewable energy stocks.
This creates a big opportunity as economies look to decarbonise. According to McKinsey, net zero will cost the world $9.2 trillion every year. And that spending by big businesses and governments is creating opportunities for investors. After all, that money has to go somewhere and into something. So investors can purchase shares in the companies helping to create a net-zero planet.
Adding to the opportunity is simply population growth. Studies suggest the world's population is expected to reach almost 10 billion by 2050. Both environmental constraints and limited fuel and water supply (used in mining) will increase our need for renewable and clean energy sources. For these reasons, investing in renewable energy makes both environmental and money sense.
Finder survey: How many Australians take ethical/ESG considerations into account when investing?
| Response | |
|---|---|
| Never | 53.49% |
| Sometimes | 36.45% |
| Yes always | 10.06% |
Source: Finder survey by Pure Profile of 1004 Australians, December 2023
How do I invest in renewable energy?
Several categories of renewable energy stocks include solar power, wind power, biomass, geothermal and hydroelectric. Some include nuclear energy to that list despite its controversy. In some cases, you can even invest in the metals that will be used in the net-zero transition.
Below is a list of ways that you can invest in companies that support renewable energy.
- ASX renewable energy stocks. You can buy shares in renewable energy companies listed on the Australian share market.
- International stocks. Some of the biggest renewable energy companies are listed on stock exchanges in overseas markets such as the US or Canada. Access these through a broker that offers international shares.
- Sustainability ETFs. ETFs contain a bundle of stocks, usually hundreds, and these often track an index of stocks. The renewables sector is still very small in Australia so there are few options to date for renewable energy ETFs on the ASX. There are many to choose from on global exchanges.
- Micro-invest. Some investment apps such as Raiz and CommSec Pocket offer sustainability funds that may support renewable energy companies. However, keep an eye out for what you actually own to make sure it aligns with your personal values.
- Superannuation. You might also be able to invest in renewable energy through your superannuation, depending on what options it offers. Most of the big funds will have an ethical option that contains some renewable equities in it while some smaller funds are exclusively related to environmental, social and governance (ESG).
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Important: The standard brokerage fee displayed is the trade cost for new customers to purchase $1,000 of either Australian or US shares. Where a platform charges different fees for both US and Australian shares we show the lower of the two. Where both CHESS sponsored and custodian shares are offered, we display the cheapest option.
Frequently asked questions
Disclaimer: This information should not be interpreted as an endorsement of futures, stocks, ETFs, CFDs, options or any specific provider, service or offering. It should not be relied upon as investment advice or construed as providing recommendations of any kind. Futures, stocks, ETFs and options trading involves substantial risk of loss and therefore are not appropriate for all investors. Trading CFDs and forex on leverage comes with a higher risk of losing money rapidly. Past performance is not an indication of future results. Consider your own circumstances, and obtain your own advice, before making any trades. Read the Product Disclosure Statement (PDS) and Target Market Determination (TMD) for the product on the provider's website.
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