Between 2018 and 2023, it is estimated that Canada’s renewable energy grew by 1.4 per cent, according to IBIS World, and was valued at roughly C$38.3 billion last year.
Renewable energy has emerged as an alternative to traditional methods of energy such as oil and gas and coal and are largely derived directly or indirectly from the sun, from heat generated from the earth or the wind.
In Canada, most of the country’s electricity generation stems from non-greenhouse gas emitting sources. The country is also a leader in hydroelectricity, nuclear power and hydrogen while wind and solar photovoltaic energy are some of the fastest-growing sources of electricity in Canada.
Additionally, it is estimated that 68 per cent of Canada’s electricity comes from renewable sources, while 82 per cent from non-greenhouse gas (non-GHG) emitting sources such as solar, hydro, wind and nuclear power.
Moving forward, as technology advances and as the government continues to make renewable energy initiatives a priority, the federal government has outlined goals on how to reduce net zero emissions by 40 to 45 per cent by 2030, and eventually net zero emissions by 2050.
All of this is to say that renewable energy incentives are only going to increase from here, and companies in the space will be ramping up their efforts to meet those demands.
Choosing the 10 Canadian largest renewable energy stocks
Stocks in this list were chosen through the TSX Renewable and Clean Tech Index (TSX:TXCT), an index that tracks companies focused on reducing throughput pressures on the ecological system when providing goods or services to global markets.
The index currently tracks 12 companies listed on the Toronto Stock Exchange (TSX) and have an average market cap of C$2 billion, with the largest company’s market cap totaling $9.6 billion.
With that in mind, here are the 10 largest Canadian renewable energy stocks, in brief:
- Brookfield Renewable Partners (TSX:BEP.UN)
- Northland Power (TSX:NPI)
- Boralex (TSX:BLX)
- Innergex Renewable Energy (TSX:INE)
- Cascades (TSX:CAS)
- Ballard Power Systems (TSX:BLDP)
- SunOpta (TSX:SOY)
- Polaris Renewable Energy (TSX:PIF)
- Lion Electric Company (TSX:LEV)
- EcoSynthetix (TSX:ECO)
10 largest Canadian renewable energy stocks
Market cap: $9.56 billion; share price: $33.55
Brookfield Renewable is based out of Bermuda and operates a trading platform focused on renewable power and decarbonization solutions. Its portfolio ranges from hydroelectric, wind, solar and distributed energy to sustainable solutions across five continents.
Notably, the company’s operating capacity totals roughly 34,000 megawatts while its pipeline is roughly 157,000 megawatts.
Its portfolio also includes investments in Westinghouse, which is a global nuclear services business, and a utility and power producer operating in the Caribbean and Latin America.
Market cap: $5.97 billion; share price: $23.25
With headquarters out of Toronto, Northland Power is focused on developing electricity from renewable resources. Under the company’s portfolio is a diversified generation mix that includes onshore renewables, natural gas energy and supplying energy through a regulated utility.
The company’s segments are offshore wind facilities, onshore renewable facilities, efficient natural gas facilities and utilities. Notably, its natural gas facilities use turbines to produce electricity.
Northland Power also has a range of projects in construction and in various stages of development encompassing approximately 12 GW of potential capacity. Its assets are operating across Asia, Europe, Latin America and North America.
Market cap: $3.42 billion; share price: $33.31
Boralex has its headquarters out of Kingsey Falls, Quebec, and is focused on four key areas in the renewable energy space, including wind, solar, hydroelectricity and storage.
Boralex is notably France’s largest independent producer of onshore wind power, while also having facilities in the United States and development projects in the United Kingdom.
As it currently stands, Boralex is developing a portfolio of more than 6.2 gigawatts in wind, solar and storage projects and has projects under construction or that are ready to be built with an additional 317 megawatts of power.
In addition to holding interests in 50 facilities across North America and 77 facilities in Europe, Boralex has acquired 50 per cent interest in five wind farms in the United States representing a total installed capacity of 894 megawatts.
Market cap: $1.93 billion; share price: $9.48
Based out of Longueuil, Quebec, Innergex Renewable Energy is a renewable power producer developing, acquiring, owning and operating hydroelectric facilities, wind farms, solar farms and energy storage facilities.
The company has its operations across Canada, the United States, France and Chile.
Within its portfolio is a range of assets that consists of interests in 88 operating facilities with an aggregate net installed capacity of 3,375 megawatts. This includes 41 hydroelectric facilities, 35 wind facilities, nine solar facilities and three battery energy storage facilities.
Innergex also holds interests in 13 projects under development with a net installed capacity of 930 megawatts, three of which are under construction. It also has prospective projects at different stages of development with an aggregate gross installed capacity totalling 9,912 megawatts.
Market cap: $979.58 million; share price: $9.70
Cascades is a Kingsey Falls, Quebec-based paper and packaging company focused on producing, converting and marketing packaging and tissue products made from recycled fibres. The company operates under three key segments, including containerboard and specialty products and tissue papers.
Under the containerboard segment is a manufacturer of containerboard and converter of corrugated products across North America. Meanwhile Cascades’ speciality products group is focused on manufacturing industrial and food packaging products. Finally, its tissue papers segment produces tissue paper reels and converts them into finished products for professional and residential markets.
Market cap: $950.57 million; share price: $3.18
Ballard Power Systems has its headquarters out of Vancouver and is a company focused on proton exchange membrane (PEM) fuel cell power system development and commercialization.
The company primarily designs, develops, manufactures, sells and services PEM fuel cell products with a focus on power products for bus, truck, rail, marine, stationary and emerging market applications.
Ballard Power Systems also focuses on the delivery of services, including technology solutions, after-sales services and training. The company also provides hydrogen fuel cell powertrain integration solutions, which is an environmentally clean electrochemical device that combines hydrogen fuel with oxygen to produce electricity.
The company has after-sale services in Denmark and the U.K. and has a sales, supply chain and after-service sales service office in China.
Market cap: $861.62 million; share price: $7.22
SunOpta operates out of Brampton, Ontario, and is focused on providing plant-based food and beverages.
Notably, the company produces its own brands, products and labels including SOWN, Dream and West Life. Meanwhile, it has a portfolio of products ranging from oat, almond, soy and coconut to rice milk and creamers.
In terms of SunOpta’s plant-based products, those include non-genetically modified organic and gluten-free products, while its consumer products include protein shakes, teas, broths and fruit snacks.
SunOpta then sells its product offerings through branded products under agreements with other branded food companies for distribution.
Market cap: $273.35 million; share price: $12.97
Polaris Renewable Energy is based out of Toronto, and is a company focused on developing and operating renewable energy projects in Latin America.
Within its portfolio, Polaris Renewable Energy operates a 72-megawatt geothermal facility in Nicaragua, three run-of-river hydroelectric facilities in Peru that have a combined capacity of approximately 33 megawatts, a 25-megawatt solar plant facility in the Dominican Republic, and a six-megawatt run-on-river hydroelectric facility in Ecuador.
Its San Jacinto-Tizate Geothermal plant is in northwestern Nicaragua and, through its subsidiary Generacion Andina SAC, Polaris Renewable Energy owns 8 de Agosto, a Run of River hydroelectric operation.
Market cap: $271.46 million; share price: $1.20
Lion Electric Company has its offices in Montreal and is focused on manufacturing zero-emission vehicles. It notably designs and manufactures all-electric school buses, midi/minibusses for special needs or urban transit, as well as urban trucks.
The company’s urban trucks can be divided into four main platforms based on gross vehicle weight rating, including namely the Lion5, Lion6, the Lion8 and the Lion8 Tractor trucks. Lion Electric’s suite of all-electric buses consists of Type A, Type C and Type D buses, while its lineup of medium and heavy-duty electric vehicles aims to address the needs of the sub-250-mile mid-range urban market.
Market cap: $247.10 million; share price: $4.20
With headquarters out of Burlington, Ontario, EcoSynthetix is focused on bio-based materials that are used as inputs in a variety of products.
The company offers sustainably engineered biopolymers that enable customers to reduce the use of harmful materials such as formaldehyde and styrene-based chemicals.
EcoSynthetix develops and commercializes bio-based technologies as replacements for synthetic, petrochemical-based adhesives and other products across the Americas, the Middle East and Africa and Asia Pacific.
Its portfolio of products includes its flagship products DuraBind, Surflock, Bioform and EcoSphere, which are used to manufacture wood composites, personal care, paper, tissue and packaging products, and enable performance improvements, economic benefits and carbon footprint reduction.
How to buy Canadian renewable energy stocks
Buying Canadian renewable energy stocks is no different than purchasing any other kind of stock in Canada. The stocks listed above trade on the Toronto Stock Exchange, although a suite of others trade on the TSX Venture Exchange and Canadian Securities Exchange that can be purchased through a range of platforms.
With that in mind, investing in renewable energy stocks can be done as follows, particularly on a stock trading platform where investors can conduct their own research:
- Choose a stock trading platform, such as Questrade or Wealthsimple where investors can invest independently without financial advice. Choose the stocks you want to invest in by searching its name or the ticker symbol. Before doing so, evaluate the renewable energy stock’s business plan and allocate only what you feel comfortable with in order to keep a balanced portfolio
- Place your order.
Should investors not want to invest in renewable energy stocks individually, investors can invest in the S&P/TSX Renewable Energy and Clean Technology Index, which offers investors exposure into the renewable energy market without investing in a specific company.
Risks of investing in Canadian renewable energy stocks
Renewable energy has become one of the hottest markets as companies shift their efforts into reducing carbon emissions and developing technologies for a greener future.
However, the excitement of the industry is not met without regulatory and policy risks as governments as well as market volatility that any sector is prone to.
Environmental and social risks also come with the renewable energy sector as well as supply chain challenges, but that doesn’t mean investors should shy away from the industry.
At the end of the day, having a balanced portfolio is key to any investment success, and renewable energy stocks might have the potential to put you on the path towards profitability.
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(Top photo: Adobe Stock)