After being badly hit by the momentum meltdown early in the year, the green energy space has regained strength over the past one month buoyed by improving green energy trends and company-specific fundamentals.
Robust performances from some of the green stocks such as Tesla Motors (TSLA), SunPower (SPWR), First Solar (FSLR), Yingli Green Energy (YGE), Trina Solar (TSL) and Canadian Solar (CSIQ) are injecting optimism into the broad sector. In fact, most of these surged double digits over the trailing one-month period.
Additionally, the depletion of fossil fuel reserves, global warming and high fuel emission issues, higher oil and gas prices, new and advanced technologies as well as more efficient applications are making clean power more feasible. Further, demand for renewable sources is growing rapidly for electricity generation across the globe.
As per the International Energy Agency (IEA), global power generation through clean energy would rise 45% to reach 26% of global electricity generation by the end of this decade from 22% in 2013. In particular, solar energy is the fastest growing sector within the global clean tech industry. This corner of the broad space will likely benefit from a decline in technology cost and increased deployment in non-OECD markets, which is expected to have 70% new power capacity from 2013 to 2020.
However, after a decade of rapid clean energy expansion, the agency expects renewable generation capacity growth in OECD economies to slow after 2015 for five years on uncertain policy and grid integration risks. This does not seem to be a major concern at present.