Is Europe’s Energy Transition Your Next Investment Opportunity?

The EU is pouring €1 trillion into clean energy by 2030, is now the time to jump in?

Why Energy Is Trending in Europe

The EU’s Green Deal is turbocharging renewables, aiming for 42.5% of energy consumption from sources like wind and solar by 2030. In 2024, renewables hit a record 47% of EU electricity, with solar overtaking coal for the first time. But it’s not just policy - geopolitics and tech are driving this. Europe plans to ban Russian gas, pushing, amongst others, green energy to fill the gap. Meanwhile, AI data centres are sipping electricity, making energy firms crucial players.

What assets would I look at?

For us Europeans, the energy transition offers tangible options:

• Stocks:

  • Ørsted (Denmark): A leader in offshore wind, with stable contracts. It’s a safer bet for steady growth.

  • Iberdrola (Spain): A utility giant with solar, wind, and hydro projects, plus a 3-4% dividend yield for income seekers.

  • Vestas (Denmark): Makes wind turbines but faces tariff risks. Morningstar calls it undervalued, ideal for patient investors.

• ETFs:

  • iShares Global Clean Energy ETF (INRG): Diversifies across global renewables, with heavy European exposure. It’s up ~10% in 2025 but volatile.

  • Lyxor New Energy ETF: Focuses on clean tech, listed on European exchanges, perfect for beginners.

• Long-Shot: Nel ASA (Norway) is betting on green hydrogen. It’s risky—losses are high—but could soar if hydrogen takes off.

What are the risks?

Green stocks can be pricey, and subsidies might shift with politics. Supply chains rely on China for metals, and tariffs could pinch margins, as Vestas is learning. Plus, transitioning costs utilities billions upfront, which could take a cut from short-term profits.

The Bigger Picture

The European Central Bank’s rate cuts in 2025 make renewable projects cheaper to finance, a tailwind for the sector. But AI’s energy hunger means grids must scale fast, boosting firms like Siemens Energy. For us, this is a 10-year story, not a quick flip.

Taking action?

If you consider investing in green energy, here are some tips:
→ Start small - with an ETF to spread risk, or pick a stock like Iberdrola for dividends.
→ Diversify - don’t go all-in. Think long-term: Europe’s rewiring won’t finish overnight.

What’s your take on clean energy? Drop a comment, and see you next week!

– MrInvest