- What is green investment
- Green shares
- US green stocks
- Solar energy companies
- First Solar
- Enphase Energy Inc.
- Sunrun Inc.
- Companies from the wind energy sector
- TPI Composites Inc.
- NextEra Energy
- Electric vehicle manufacturers
- Wabtec Corp.
- Livent Corporation
- QuantumScape Corporation
- Green fuel producers
- Renewable Energy Group Inc.
- plug power
- Waste recycling companies
- Waste Management
- Plant Meat Producers
- Beyond Meat
- Russian green shares
- Enel Russia
- Risks of investing in green energy companies and green technologies
- Prospects for investing in shares of green companies
- How to buy green stocks
The environmental trend now concerns not only ordinary life, but also the stock market. Investors want to take care of nature and are more likely to pay attention to the environmental and social profile of companies.
The editors of Investlab made a material about what green investments are and what green shares are available for investment on Russian exchanges.
What is green investment
The term first began to be used in the 1980s, when European banks drew attention to environmental problems and began to support environmental projects. Back then it was called “green finance”.
Now any private investor can take care of the environment and at the same time make money on it. True, in order to choose the right green stocks on the stock exchange, you need to understand the business of a particular company.
After all, even oil and gas corporations are trying to support sustainable development trends. So, Rosneft in 2020, it allocated 300 billion rubles to combat greenhouse gases emitted by its production facilities.
Other major oil and gas players are also developing their environmental policies. This increases their rating in foreign markets, helps to avoid government fines, and also increases their popularity among investors, for whom “greenness” is the main criterion when choosing shares to buy.
Other examples of Russian oil and gas companies that have environmental regulations: Lukoil, Tatneft, Gazprom, Novatek, Gazprom Neft, Bashneft.
Despite their concern for the environment, oil or gas companies are not truly green. So if contributing to the care of nature is important to you and you believe in the future of renewable energy, self-driving cars and alternative fuels, take a closer look at companies that work in these or related fields.
Below we have selected shares of green companies from the US and Russia, which can be bought on the Moscow or St. Petersburg stock exchanges.
US green stocks
There are many green American companies on the stock market: owners of solar and wind farms, manufacturers of unmanned electric vehicles, biofuels, and even plant-based meat products.
Solar energy companies
An American company that manufactures, installs, maintains and recycles solar panels. Built many of the largest solar parks in the US, Canada, UAE, Germany, Italy, Israel, Australia.
Enphase Energy Inc.
Enphase Energy develops solar energy solutions for the home. It produces solar modules and energy storage devices for the home. Creates software that allows you to manage consumption and track performance. Sells products in North America, Australia and Europe.
Another company that makes solar panels for home use. It offers its systems in the USA, concluding with buyers contracts for the lease or sale of equipment.
Companies from the wind energy sector
TPI Composites Inc.
TPI Composites produces blades for wind turbines. Delivers products all over the world. The leader in the sale of blades for coastal windmills. The number of employees is more than 14 thousand people.
NextEra Energy owns wind and solar plants. Together with its subsidiaries, it is the world’s largest supplier of energy to customers through alternative sources. Also manages installations that run on gas, coal or nuclear energy.
Electric vehicle manufacturers
The most popular company that makes electric cars. Produces cars, batteries for energy storage, solar panels, solar tiles. Builds a network of “superchargers” for electric vehicles, where some gas stations are powered by solar energy. Tesla owner is Elon Musk.
Wabtec makes electric motors for railroad locomotives. It also produces digital electronics for them: electronic train control systems, artificial intelligence optimizers that reduce fuel consumption, braking systems that reduce train stopping times, and communications equipment.
Chemical company. Produces lithium – one of the main components in batteries for electric vehicles. Livent factories are located in the USA, Argentina, Great Britain, India, China.
Albemarle produces complex chemicals with deep processing. The company has three main areas: lithium products, bromine products, catalysts. Global supplier of chemicals. One of the leaders in the extraction and production of lithium, which is needed in the production of electric cars.
QuantumScape explores the properties of lithium. The company is exploring solid-state lithium metal batteries, and by 2025 wants to make a battery that charges faster and lasts longer than current chargers.
Green fuel producers
Renewable Energy Group Inc.
The largest producer of biodiesel in the US. Fuels are made from biomass, such as vegetable oils or animal fats. Owns 13 biological processing plants, as well as one primary raw materials processing plant.
The company is developing hydrogen fuel systems. They are used to replace conventional batteries in electric vehicles: forklifts, cargo electric vehicles, unmanned aerial vehicles. The main advantage of such systems is zero emissions and fast charging.
Waste recycling companies
Waste Management removes municipal solid waste and recycles it. It has more than 340 loading stations, about 300 landfills, 146 waste processing plants and 6 power plants. Leads projects for the processing of landfill gas into energy. The total number of Waste Management clients is 21 million people. Business geography – USA.
Plant Meat Producers
Beyond Meat makes plant-based meats with chicken, pork, and beef flavors. The main ingredients for production: peas, mung beans, brown rice, coconut oil, potatoes, beetroot juice, apple extract.
The company claims that it takes less water and energy to produce a single plant-based meat burger than a regular beef burger. This helps conserve resources while minimizing environmental impact.
Russian green shares
The share of installed capacity of wind and solar power plants in Russia is very small – only 0.07% and 0.55% of the total capacity of the Russian energy system. Hydropower is much better developed. Its share in the Russian Federation is 20%. Unfortunately, there are not many public Russian green companies whose shares can be bought on the stock exchange.
Russian energy holding. Owns 60 hydroelectric power plants. The largest in terms of capacity is the Sayano-Shushenskaya HPP on the Yenisei River. It also generates energy at wind, solar and geothermal power plants located in Kamchatka, Sakhalin, Yakutia, the Yamalo-Nenets Autonomous Okrug and the Amur Region.
In 2019, this company sold all its coal-fired power plants and decided to build wind farms.
Enel is building wind farms in the Sverdlovsk, Rostov, Murmansk regions and the Stavropol Territory. It is planned that by 2022 they will provide about 40% of the total energy generated by the company, and will fully begin their work by 2024.
RUSAL is a Russian aluminum producer. It can be classified as a green company because of the low carbon footprint aluminum it produces under the ALLOW brand.
The amount of emissions in the production of such aluminum is five times lower than that of conventional aluminum. The main factor that helps to reduce emissions is the use of energy from hydroelectric power plants.
Risks of investing in green energy companies and green technologies
- So far, global demand for traditional energy sources, fuel and cars is more stable than for alternative ones.
- Some green economic sectors require large capital expenditures. In the case of solar farms, these are large areas of land, maintenance costs, consumables and disposal. And for electric cars, there is no developed infrastructure of filling stations, the capacity of which would allow you to quickly charge the battery.
- Green companies depend on the states where they operate. Politicians support the transition to renewable sources and therefore sponsor the business of some companies. This means that not everyone can generate cash flow themselves and live off government subsidies.
Prospects for investing in shares of green companies
- In the long run, investors can benefit from investing in green companies. With the development of technology, the transition to renewable sources will increase, and the production of such energy will become cheaper. From 2010 to 2020, the cost of producing solar energy has already fallen by 80%, and wind energy by 39%.
- Governments around the world will continue to subsidize the industry amid the climate crisis. Individual companies can become the largest corporations in the world, displacing oil and gas corporations and conventional automakers from the energy market.
- In some regions of the world, it is easier to produce energy using the sun or wind. Alternative energy also helps those countries that do not have their own natural resources.
How to buy green stocks
You can buy shares of green companies that we have listed in the article on the Moscow and St. Petersburg stock exchanges. To do this, you need to choose a broker. Through it, you can enter into transactions to buy or sell shares.
Broker – a company that helps an investor invest money, registers it on the exchange and takes into account all its transactions. It is impossible to trade on the stock exchange directly without a broker.
To start working with a brokerage company, you need to open a brokerage account – a special account for investors, where all transactions with securities will be displayed. You will need a passport to open an account.
Brokers do not charge for opening an account, but they charge a commission for transactions. Usually no more than 0.3%. For example, you decided to buy RusHydro shares for 10 thousand rubles, made an order through a broker to buy, the broker converted your money into shares and withheld a commission of 30 rubles.
You can open a brokerage account and buy shares remotely through the broker Tinkoff Investments:
- Log in to your personal account using the login and password that Tinkoff will issue.
- Find the necessary securities in the catalog, replenish your account with a card and make a deal.
- Tinkoff commission for transactions on the exchange from 0.025%, and account maintenance is free. For depositing or withdrawing money from the account, the broker does not charge additional commissions.
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