1 Renewable Energy Stock to Buy in 2025 and Hold for Decades

Renewable energy is here to stay.

For example, sales of electric vehicles in the U.S. soared from 294,000 in 2021 to 1.4 million three years later, according to data from the International Energy Agency (IEA). Utility companies are not doubling down on old-school fossil fuels to support the resulting surge in electric power demand, but exploring alternatives such as wind and solar energy instead. As a result, American solar energy installations are speeding up. Consumers are nervous about high interest rates on costly solar panels, but commercial and utility-scale installations skyrocketed in 2024.

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According to a recent research report from The Motley Fool, many U.S. states produce most of their electricity from renewable power sources. In places like Iowa, South Dakota, and Kansas, the renewable portion is more than 50% of the annual power production.

I could go on, but you get the drift. People care about how their electric power was generated nowadays. Moreover, alternative or renewable electricity sources are not just competitively priced in 2025 -- they often deliver their sparks at a much lower cost than power stations burning coal or natural gas.

So how can investors take advantage of this secular market trend? I find one renewable energy expert particularly interesting right now, and suggest you consider picking up a few shares of Brookfield Renewable (NYSE: BEPC) and holding on to them for a couple of decades. The road ahead probably won't be smooth, but the long-term returns should be worth dealing with some turbulence.

The green energy powerhouse you need to know

The name is a big hint. Brookfield Renewable develops, builds, and operates clean energy generators on a global scale. About two-thirds of its business is in North America, but Europe and South America also represent massive markets for this company. Its product portfolio is varied across solar, wind, and energy storage solutions, with a heavy weight on hydroelectric dams.

This is one of the world's largest renewable power experts. It has about 37 gigawatts (GW) of operating capacity with another 200 GW under development. To put these green energy generation figures in perspective, Duke Energy (NYSE: DUK) has 55 GW of capacity. Only 9 GW of Duke's energy comes from renewables today. Consolidated Edison's (NYSE: CE) 0.8 GW is almost entirely produced by burning natural gas. Brookfield's energy generation is kind of massive, especially in the smaller-scale context of pure renewables.

Fuel for the green growth fires

And let me tell you that this should be a great time to sell energy of any kind -- but especially of the environmentally friendly variety. There are so many growth catalysts floating around, besides the electric cars mentioned above.

Corporate data centers consume a ton of energy in a normal economy. The artificial intelligence (AI) boom is boosting those power bills. The four biggest buyers of clean energy are the cloud computing giants in the "Magnificent Seven" group, with Amazon (NASDAQ: AMZN) running far ahead of the other power gluttons. All of them are Brookfield customers with a tight focus on low-carbon solutions.

The cryptocurrency industry is going through another upswing after last April's Bitcoin (CRYPTO: BTC) halving event. Bitcoin's value is directly based on the amount of electric power the blockchain network consumes. The halving cut the financial rewards in half for Bitcoin miners, so they're investing in more computers and stronger electric power supplies. Again, Brookfield is ready to serve many of the leading players in this crypto boom.

Image source: Getty Images.

Wall Street isn't paying attention

Full-year sales rose by 6% in 2024 for Brookfield Renewable, and funds from operations (FFO) jumped 10% higher. With so many growth-boosting trends in play, you might expect Brookfield Renewable's stock to be skyrocketing.

Well, it's not.

Share prices are down by 6% over the last year, while the S&P 500 (SNPINDEX: ^GSPC) market index gained 23%. The stock trades at the bargain-bin valuation of 14.5 times FFO. Brookfield Renewable's business seems poised for many years of industry-leading growth, and the stock looks much too cheap.

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John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Anders Bylund has positions in Amazon and Bitcoin. The Motley Fool has positions in and recommends Amazon and Bitcoin. The Motley Fool recommends Brookfield Renewable and Duke Energy. The Motley Fool has a disclosure policy.