Companies are going green. These clean tech names will get a boost, says Raymond James

Published Tue, Apr 27 202111:20 AM EDT

Corporations are pledging to go green, but they'll need help making the transition to renewable energy. That development translates to upside for companies like SunPower , according to Raymond James. Last week RE100, a global coalition of companies targeting 100% renewable energy, topped 300 members. The coalition, which is made up of companies outside the energy industry, requires joiners to commit to 100% renewable energy by 2050 and at least 60% by 2030. Altogether the group's power consumption stands at 315 terawatt-hours, surpassing that of the entire U.K. economy, according to Raymond James, underlining the significance of the group. The firm added that RE100 illustrates the growing importance of ESG investing — that is, investing based on a company's environmental, social and corporate governance factors. Since the coalition is made up of energy consumers rather than energy producers, these companies are not being forced to go green by regulatory mandates. Given RE100's interim targets, Raymond James noted that "substantive action is required right away, and not merely at some distant point in the future." "By definition, these targets do not have the force of law, but the public profile of RE100 is such that any company that makes the pledge and fails to deliver will pay a PR price, including taking a hit in its ESG score," the firm side. While ESG is a virtually unanimous driver of companies joining RE100, so, too, is cost. Indeed, 70% of companies cited expense as an additional reason to shift to renewable energy. "The combination of environmental advantage and tangible financial gain makes switching to renewable power a textbook win-win proposition," the firm said, before adding that the magnitude of savings depends, of course, on location. Raymond James pointed to four companies with direct leverage to the green operations push: Ameresco , Bloom Energy , ReneSola and SunPower. Massachusetts-based Ameresco manages energy efficiency upgrades for commercial and institutional buildings. "The U.S. federal government is Ameresco's largest customer, and overall the bulk of the revenue comes from the public sector, but the company has done projects for businesses ranging from bank office buildings to restaurants," Raymond James noted. The company has a $2.6 billion market cap, and shares are down less than 1% for the year. Bloom Energy, meanwhile, manufactures stationary fuel cells that have been used to power everything from data centers to hospitals to retail stores. "The fuel cells most commonly use conventional natural gas feedstock, but they are also able to run on renewable natural gas or green hydrogen, in which case the output conforms to the RE100 rules," Raymond James said. Shares of the company, which has a $4.8 billion market cap, are down about 3% for 2021. ReneSola and SunPower are both solar companies, with each one offering build-and-sell solar projects. In other words, the companies get the solar site up and running, before selling them to other owners who might be looking to increase their renewable power footprint. U.S.-listed shares of ReneSola are down 10% for the year, while SunPower's stock has jumped 15%. - CNBC's Michael Bloom contributed reporting.

Construction workers install SunPower tiles on homes in San Ramon, Calif.

Robert Nickelsberg | Getty Images

Corporations are pledging to go green, but they'll need help making the transition to renewable energy. That development translates to upside for companies like SunPower, according to Raymond James.

Last week RE100, a global coalition of companies targeting 100% renewable energy, topped 300 members. The coalition, which is made up of companies outside the energy industry, requires joiners to commit to 100% renewable energy by 2050 and at least 60% by 2030.