How to Profit from UK Renewable Energy 2024

The UK Renewable Energy 2024 programme has been launched.

In a reversal of the old Tory policy which effectively discouraged further integration renewable energy (specifically solar and wind), the new Labour government in the UK has already approved three new solar farms in the East of England. Once completed, these three solar farms will generate enough electricity to power around 400,000 homes.

The new government also lifted the previous restriction on onshore wind development, which rejected any project that met with any public opposition. And when I say “any,” I mean “any.” One person could simply oppose it, and that would be enough. Some even called it a “de facto” ban on all new onshore wind installations.

Although, interestingly, almost 30% of all energy generated in the UK already comes from wind. With the new government, this could rise to over 50% by 2030.

The new government also aims to increase the share of solar energy from around 5% to 15%. If successful, around 65% of the country’s electricity will come from wind and solar alone. Add biomass and hydropower to that, and you’re looking at over 70%.

That’s what I mean when I say that Renewable energy in the UK 2024 is just the launching pad for a huge renewable energy boom in the UK

UK renewable energy in 2024 leaves 2023 behind

Of course, renewables in the UK have been steadily eroding their share of the fossil fuel market over the past decade. According to data from the UK’s electricity system operator National Grid, since 2014 the proportion of UK energy coming from fossil fuels has fallen from 58.1% to 32.2%. This is not trivial. By the end of the decade, fossil fuels are likely to supply less than 25% of the country’s electricity needs. The move away from fossil fuels is well underway in the UK. And of course, this opens up new opportunities for investors in renewable energy.

In the wind sector, companies that could benefit from expanding UK wind assets include:

• Ørsted (OTCBB: DNNGY)
• Iberdrola (over-the-counter medicine: IBDRY)
• Siemens (OTCBB:SIEGY)
• Cadeler (NYSE: CDLR)

In terms of the solar sector, most UK solar developers are private. And the majority of solar panels used in UK installations come from China. This is a sticking point for those looking to expand the solar market in the country. Particularly because of questions about the slave labour in China used to manufacture these panels. So it’s hard to judge how best to play this out at the moment.

Although it should be noted that the new government wants to rewrite Planning principles to increase the number of rooftop solar installations both for existing homes and new builds. If successful, one company that will definitely benefit is Enphase Energy Company (NASDAQ:ENPH).

If you’re not familiar, Enphase is the largest supplier of microinverter-based solar and battery systems in the world. The company has shipped 70 million microinverters worldwide to date. It already has a presence in the UK market and has little competition.

Now, that particular stock has struggled a bit this year after struggling with high interest rates and a slowdown in new home construction. But as the UK government moves to support the solar industry, Enphase should benefit.

If you don’t already own the stock, I recommend buying below $125 per share. Of course, this isn’t a quick trade, but rather a long-term play based on the continued growth of the global solar market.

By the end of the year, I expect Enphase to trade at around $135 per share. And by this time next year, over $160.