Summary: Investing in renewable energy dividend stocks offers a double benefit: supporting sustainable energy initiatives while earning steady returns. In this guide, we take a look at top 3 picks for 2025 that are all available for purchase on our go-to online broker, eToro.
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What are renewable energy dividend stocks?
Renewable energy dividend stocks represent shares in companies that generate electricity from renewable sources such as wind, solar, hydro, and geothermal energy. These companies distribute a portion of their profits to shareholders in the form of dividends, making them an attractive option for income-oriented investors. Additionally, investing in renewable energy dividend stocks aligns with sustainability goals, contributing to the fight against climate change.
3 best renewable energy dividend stocks
After conducting thorough research, we’ve come up with our top 3 renewable energy dividend stock picks, including:
- Clearway Energy (NYSE: CWEN);
- NextEra Energy Partners (NYSE: NEP);
- Brookfield Renewable Partners (NYSE: BEP).
Highly Rated Stock Trading & Investing Platform
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Invest in 2,800+ stocks and other assets including 70+ cryptocurrencies and commodities.
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0% commission on buying stocks - buy in bulk or just a fraction from as little as $10. Other fees apply. For more information, visit etoro.com/trading/fees.
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Copy top-performing traders in real time, automatically.
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eToro USA is registered with FINRA for securities trading.
1. Clearway Energy (CWEN)
Clearway Energy stands out as a leading player in renewable energy generation and distribution. With a diverse portfolio comprising wind, solar, and natural gas assets across the United States, Clearway offers stability and growth potential. The company’s commitment to expanding its renewable energy capacity while maintaining attractive dividend payouts makes it an appealing choice for investors seeking both income and capital appreciation.
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2. NextEra Energy Partners (NEP)
NextEra Energy Partners is among the largest renewable energy companies globally. Focused on wind and solar energy projects, NEP boasts a robust pipeline of assets poised for future growth. Investors are drawn to NEP’s strong track record of dividend growth, supported by stable cash flows from long-term power purchase agreements. With a strategic vision centered on sustainability, NextEra Energy Partners offers compelling opportunities for income-oriented investors.
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3. Brookfield Renewable Partners (BEP)
Brookfield Renewable Partners is a globally diversified owner and operator of clean energy assets. Their portfolio includes hydroelectric, wind, solar, and storage facilities across North America, South America, Europe, and Asia, totaling approximately 21 gigawatts of installed capacity. The company offers a dividend yield of around 6.1%, making it an attractive option for income-focused investors.
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Where to buy renewable energy dividend stocks?
When it comes to buying and selling stocks, choosing the right platform is crucial. As such, our chosen broker is eToro, a user-friendly and popular online trading platform that allows investors to access a wide range of stocks, including renewable energy dividend stocks like CWEN, NEP, and BEP. It also offers a range of useful features, such as:
- Commission-free stock trading;
- Access to over 2,000 stocks from 17 different exchanges;
- The option to purchase fractional shares;
- Charting tools;
- A user-friendly platform that simplifies the trading experience.
Highly Rated Stock Trading & Investing Platform
-
Invest in 2,800+ stocks and other assets including 70+ cryptocurrencies and commodities.
-
0% commission on buying stocks - buy in bulk or just a fraction from as little as $10. Other fees apply. For more information, visit etoro.com/trading/fees.
-
Copy top-performing traders in real time, automatically.
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eToro USA is registered with FINRA for securities trading.
For those interested in dividend investing, feel free to check out our other guides, including:
- 3 Best Undervalued Dividend Stocks;
- 3 Best Energy Dividend Stocks;
- 3 Small Cap Dividend Stocks;
- 3 Warren Buffett Dividend Stocks;
- 3 Best UK Dividend Stocks;
- 3 Oil Dividend Stocks;
- 3 Best Dividend Stocks.
Pros and cons of buying renewable stocks
Pros
- Growth potential: The renewable energy sector is expected to grow significantly as the world transitions to cleaner energy sources;
- Environmental impact: Investing in renewable energy supports the global effort to reduce carbon emissions and combat climate change;
- Government support: Many governments offer incentives and subsidies for renewable energy projects, which can benefit companies in this sector;
- Diversification: renewable energy stocks can diversify an investment portfolio, reducing overall risk.
Cons
- Volatility: The renewable energy sector can be volatile due to policy changes, technological advancements, and market competition;
- High initial costs: Renewable energy projects often require significant upfront investment, which can impact profitability in the short term;
- Regulatory risks: Changes in government policies and regulations can affect the profitability and viability of renewable energy projects;
- Competition: The sector is becoming increasingly competitive, with many companies vying for market share, which can affect individual stock performance.
Common investing mistakes when buying dividend stocks
Investors may fall into the trap of solely focusing on high dividend yields without considering the underlying fundamentals of the company, which is one of the most common investing mistakes when buying dividend stocks. The thing is—high yields could be a warning sign of an unsustainable dividend or deteriorating financial health. Still, this isn’t the only pitfall that you can come up against. You should also be wary of:
- Ignoring dividend sustainability: It’s essential to assess the sustainability of a company’s dividend payments by analyzing factors such as cash flow, earnings stability, and payout ratio. Investing in companies with consistently growing dividends and a history of prudent capital allocation is crucial for long-term success;
- Neglecting diversification: Concentrating investments in a few dividend-paying stocks or sectors increases portfolio risk. Diversification across different industries and asset classes can help mitigate risks and enhance overall portfolio stability;
- Overlooking growth potential: While dividend income is attractive, investors shouldn’t overlook companies with significant growth potential. Balancing dividend-paying stocks with growth-oriented investments can optimize portfolio returns over the long term;
- Failing to reevaluate investments: Market conditions and company fundamentals evolve over time. Investors should regularly review their dividend stocks’ performance and adjust their portfolios accordingly to ensure alignment with their financial goals and risk tolerance.
Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
FAQs about investing in the best renewable energy dividend stocks
What energy stocks pay the highest dividend?
ExxonMobil Corporation (NYSE:XOM), Chevron Corporation (NYSE:CVX), and ConocoPhillips (NYSE:COP) are among the energy stocks known for paying some of the highest dividends.
Which stock is best for renewable energy?
Determining the best renewable energy stock depends on factors such as investment goals and market conditions. Notable options include Clearway Energy (NYSE: CWEN), NextEra Energy (NYSE: NEP), and Brookfield Renewable Partners (NYSE: BEP), known for their extensive renewable energy portfolios and strong financial performance.
Are renewable energy dividend stocks a safe investment?
While renewable energy dividend stocks offer income potential, investors should conduct thorough due diligence to assess the financial health and sustainability of dividend payments.
How often are dividends paid for renewable energy stocks?
Dividend payment frequency varies among companies, but they typically occur quarterly or semi-annually.
Can I reinvest dividends from renewable energy stocks?
Many companies offer dividend reinvestment plans (DRIPs), allowing investors to automatically reinvest dividends to purchase additional shares without incurring transaction fees.
What factors should I consider when evaluating renewable energy dividend stocks?
Key factors to consider include the company’s financial performance, dividend sustainability, growth prospects, competitive positioning within the renewable energy sector, and regulatory environment.
Highly Rated Stock Trading & Investing Platform
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Invest in 2,800+ stocks and other assets including 70+ cryptocurrencies and commodities.
-
0% commission on buying stocks - buy in bulk or just a fraction from as little as $10. Other fees apply. For more information, visit etoro.com/trading/fees.
-
Copy top-performing traders in real time, automatically.
-
eToro USA is registered with FINRA for securities trading.
