Green energy has been on investors’ radars for some time but in the past year has picked up more steam than ever before. With climate change on the forefront of political agendas, the clean energy and renewable space is receiving backing at an unprecedented level in the form of tax breaks and investments. Being that the space is so popular at the moment, it has characteristics of a modern-day gold rush. While there will be legitimate businesses and solutions that progress the green energy revolution, there will also be many companies that fall off along the way. For this reason we are hyper focused on only selecting names we think will be contributors over the long haul towards the goal of a greener planet.

Being that the space is so popular at the moment, it has characteristics of a modern-day gold rush.

Below are our highest conviction names in the green energy space (in no particular order):

• Hannon Armstrong Sustainable Infrastructure Capital (HASI): This is a green energy REIT that provides capital and financing to both residential and commercial solar projects. One of its biggest partners is Ameresco, a leading developer of alternative energy projects. HASI has a strong dividend component as well which provides a buffer to any volatility in the name.
• Freeport McMoRan (FCX): Freeport is an indirect play on green energy as it is a mining company that has a large portion of its business dedicated to copper. The reason this is a green energy play is due to the fact that electric vehicles (EVs) and other renewable energy technologies require a large amount of copper. Producing EVs require 6x as much copper than tradition combustion vehicles making miners like Freeport essential in order to continue the transition to EVs.
• DocuSign (DOCU): By creating an electronic signature platform, DocuSign has eliminated the need for printing and sending contracts for signatures. While there are many benefits in terms of business efficiency, the direct impact to a greener planet is reducing the amount of trees being cut down for paper. As more businesses switch to DocuSign and the future capabilities of being able to notarize documents over the platform, the dependency on paper will continue to diminish.

While there are many benefits in terms of business efficiency, the direct impact to a greener planet is reducing the amount of trees being cut down for paper.

• Enphase (ENPH): Enphase is one of the top companies coming out of the solar energy space. They are the leader in producing microinverters which are the cheaper and more efficient version of traditional inverters found in legacy solar technology. In addition to the microinverters they have also developed a software that will reduce the number of solar panels needed to produce equivalent levels of energy.
• Bloom Energy (BE): Bloom is a hydrogen energy company that creates on-site energy units meaning companies or cargo ships can have clean, self-sustained energy for long periods of time. Carbon output is drastically reduced by deploying this technology and also is more cost-effective which makes it an easy sell to prospective businesses.
• ICLN ETF: If considering an ETF to diversify across a broader range of green companies, ICLN offers good exposure across multiple sectors. The expense ratio is relatively high compared to other ETFs at 0.46% but can be worth it for a more passive approach to green investing.
• While we believe over the long-term green energy will be a worthwhile investment from a return perspective, caution over the short-term should be taken into consideration as a lot of investors have flocked to the space in the past year. So long as an investor can have a 5–10-year time horizon, investment in this space should be fruitful as both an investment and as a holistic gesture in the bigger picture of a greener future.