The discussion on the top energy storage stocks has been heating up nicely with the expansion in the renewable energy realm. Solar panels and wind turbines are major contributors to clean energy production, but natural conditions often hamper their efficiency. This is where energy storage steps in, offering a robust solution to intermittent power generation issues.
As global momentum shifts towards cleaner energy sources, businesses are moving away from fossil-based energy in a bid to mitigate climate change effects. This shift is further accelerated by governmental commitments to net-zero and state-level initiatives to develop energy storage solutions.
The demand for energy storage in the U.S. is growing rapidly. From a capacity of 1.5 Gigawatts in 2020, it’s projected to reach a staggering 30 Gigawatts by 2025. This rapid expansion presents a promising outlook for high potential energy stocks.
Tesla (TSLA)
Tesla (NASDAQ:TSLA) has been making notable strides in the energy storage sphere. The company, primarily known for its electric vehicles, has been effectively scaling production of lithium-ion batteries.
The Tesla Powerwall, a direct-to-consumer product, uses this battery technology to offer homes an efficient energy storage solution. As production scales up, the cost of the Powerwall is becoming more affordable, and with more stringent regulations on carbon-intensive electricity, renewable energy storage solutions like the Powerwall are becoming more attractive than ever.
Tesla recently wrapped up the first quarter 2023 generating $23.3 billion in sales, with $1.5 billion coming from the Powerwall and other storage solutions. Furthermore, energy storage revenue has seen year-over-year growth of 148%, faster than the overall company growth. Therefore, Tesla’s position in the sector could potentially contribute immensely to its overall sales.
Fluence (FLNC)
Fluence (NASDAQ:FLNC) is one of the top pure-plays in energy storage and digital applications for renewables, pushing the envelope with its robust product base. Its deployment of the world’s fastest-responding battery and storage facility, boasting demand response times of under 150 milliseconds, underscores its robust positioning in its niche.
Moreover, its unwavering commitment to safety and a resilient supply chain is a potent combination that’s hard to ignore. The clientele of Fluence speaks volumes about the trust the company has earned. Indeed, with such a strong track record, Fluence Energy is carving out its niche as the go-to provider for battery energy storage solutions.
The firm has been growing rapidly, with its top line growing by more than 70% on a year-over-year basis. Moreover, assets under management, backlog and pipeline in the energy storage realm have grown by double-digit margins in the past six months ending March 31. Its total backlog is a whopping $2.8 billion per its most recent quarterly report, making it a mighty impressive bet in its niche.
NextEra Energy (NEE)
NextEra Energy (NYSE:NEE) is a leading energy player involved in constructing large-scale power systems that effectively deliver power and energy storage solutions at a cost lower than most individual home setups. The company proudly boasts of the largest energy storage capacity in the U.S. and continues expanding its footprint nationwide by adding new systems each quarter.
While not exclusively focused on renewables, NextEra is making it a priority. Its green energy business, together with its subsidiaries, is the global leader in the generation of wind and solar energy production and a leader in battery storage. Moreover, all of its green energy projects are based in the U.S., enabling it to benefit from the tax breaks based on the Inflation Reduction Act. The division has been a major contributor to its growing bottom line, having swung from a net loss of $1.5 billion to a net profit of $1.44 billion in its most recent quarter.
Furthermore, despite the headwinds, NextEra’s consistent growth in the number of installed generators and increased storage capacity positions it as a front-runner in the pursuit of decarbonization worldwide.