Renewable energy isn't just a way to limit pollution, it's also the catalyst behind the best energy stocks in 2018...
You see, renewable energy production in the United States will double by 2025, according to the Energy Information Administration (EIA). And while renewable energy includes a lot of sources, like nuclear and hydropower, the biggest sources of growth are coming from wind and solar.
Wind energy is now the cheapest source of electrical power in the United States, and the EIA forecasts solar power production will skyrocket 500% by 2040.
Here's what's spurring the staggering growth of renewable energy, plus the two best energy stocks to buy right now...
Demand for Renewable Energy Is Rising Across the Globe
Renewable energy isn't just growing in the United States - it's growing across the world.
In China, solar production is expected to rise a whopping 700% by 2035.
The Chinese government is pushing for solar energy to grow, and China is already beating its own targets. Initially, China planned to reach 105 gigawatts of solar power capacity by 2020. But earlier in 2017, it not only surpassed that target, but it hit 112 gigawatts of capacity.
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In fact, China added twice as much solar capacity in one year than any other country.
And in Europe, the EU is currently considering a mandate to make 35% of the energy of its member nations into clean energy as soon as 2035.
You see, countries across the world actually need to use alternative energy to meet their energy needs.
The IEA forecasts the demand for energy across the world will rise 25% by 2040.
And renewable energy sources have two advantages over their fossil fuel rivals, and those advantages are fueling renewable energy stocks...
Why Clean Energy Has Even Bigger Potential
First, renewable energy is limitless and clean.
That means energy from the sun or wind will never run out, unlike oil, coal, and gas. As supplies of fossil fuels drop, their prices will rise. Similarly, as supplies fall, it will be harder and harder to extract oil, gas, and coal, since the easiest to reach deposits will disappear first.
Alternative energy sources don't have this problem. And as the technology needed to capture solar and wind power improves, they will be even cheaper than fossil fuels.
Second, the cost of renewable energy is falling.
For example, solar energy costs are only 1/150th of the costs for solar power during the 1970s. Wind-powered energy is even less expensive. The EIA notes that wind is the least expensive energy source driving new power plants.
The falling cost of renewable energy is one reason Money Morning Global Energy Strategist Dr. Kent Moors says solar and wind power are achieving grid parity.
"Grid parity" means it costs the same to produce energy with solar and wind as it does with traditional power sources like coal and gas. Right now, at least 20 states - including California and New York - have achieved grid parity between wind, solar, and fossil fuels.
Grid parity, coupled with renewable energy's advantages, means clean energy investments are poised to soar. In fact, the EIA forecasts that solar energy production will rise 376% by 2040, and wind energy production will increase 118% in the same time frame.
That makes the right renewable energy stocks an exciting opportunity right now, as they will ride this triple-digit industry growth. And we've made it easy for investors to find the best energy stocks to buy with our top two clean energy stock picks...
Our Top 2 Energy Stocks to Buy in 2018
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Woodward Inc. (Nasdaq: WWD) is one of the best clean energy stocks to buy this year.
Dr. Kent Moors first recommended Woodward back in July 2015. Since then, it has risen more than 38%. And we think it's about to head a lot higher now that the costs of wind and solar energy have dropped.
Woodward energy is connected to the solar and wind industries, but it's not a traditional renewable energy company. Woodward is involved in the design and manufacture of the technology behind renewable energy plants, as well as all the components needed to generate such energy.
Because Woodward manufactures everything from wind turbines, to photovoltaic cells, to the industrial equipment needed to turn solar and wind power into electricity, its products are needed industry-wide.
On top of that, Woodward is simply a well-run company with a proven track record. The company has a $4 billion market cap, and it beat earnings expectations every quarter last year. That's thanks to its 9.74% profit margin, which means the company is comfortably turning revenue into profit.
Wall Street analysts predict its share price could rise more than 18% over the next year. But Woodward is heading even higher as renewable energy overtakes fossil fuels.
WWD currently trades at $74.03 a share and pays a dividend yield of 0.68%.
The other clean energy stock to buy this year is JinkoSolar Holding Co. Ltd. (NYSE: JKS).
JinkoSolar is a Chinese manufacturer of photovoltaic components and the world's third-largest solar supplier by capacity. Founded in 2006, JinkoSolar began by manufacturing solar wafers and has since expanded to include solar cells and other solar energy modules.
"This is the premier solar company in the world," said Moors. "With global operation and good relations with the Chinese government, Jinko is perfectly positioned to continue growing."
And because it's based in China, JKS could take advantage of the United States' withdrawal from the Paris Climate Accord, as China and Europe step up to fill the leadership void.
The company operates five production sites, with one major manufacturing plant located in Malaysia. JKS is a member of the Silicon Module Super League (SMSL), which is a group of six major solar module suppliers in this growing industry.
And earlier in June, the company was the first photovoltaic module manufacturer to ship more than two gigawatts of modules in a single quarter. We're expecting more of the same in the future from JinkoSolar, which is forecasting a 30% growth in sales next quarter.
Shares of JKS are trading at $27.83.
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