Green ETFs to Keep an Eye On as US Clean Energy Set to Reach a Record 50GW in 2025

U.S. Clean Energy Installations Reach Historic High in 2025

On March 5, 2026, the American Clean Power Association (ACP) unveiled a new report highlighting that clean energy installations in the United States soared to an unprecedented 50.3 gigawatts (GW) in 2025—a 3% increase over the previous year. This milestone marks the first time annual installations have surpassed 50 GW, with solar, wind, and battery storage now making up more than 90% of all new power capacity added to the national grid.

Over the last two years, the U.S. clean energy sector has faced significant challenges, including adverse policy changes and a reduction in federal incentives that once fueled industry growth.

Despite these obstacles, the sector’s record-setting performance has propelled it back into the international spotlight, demonstrating a robust comeback.

This resurgence is likely to renew investor interest in U.S. clean energy stocks and the exchange-traded funds (ETFs) that track them.

Before exploring specific ETF opportunities, it’s important to examine the factors behind this surge and consider whether this momentum can be maintained in the years ahead.

Key Drivers of the Clean Energy Boom

The dramatic increase in clean energy capacity last year was primarily fueled by a sharp rise in electricity demand, largely due to the rapid expansion of AI-powered data centers and the ongoing electrification of various sectors. This spike in demand created an urgent need for new power sources, with clean energy emerging as the quickest and most cost-effective way to meet grid requirements.

Additionally, the 2025 surge reflects a period of catching up, as many projects previously delayed by supply chain issues finally moved forward.

Managing the variability of renewable energy sources has become increasingly important. Battery storage installations, in particular, jumped by 41% year-over-year, adding nearly 4 GW more than in 2024. This growth in storage was crucial, enabling the seamless integration of record amounts of new solar and wind power into the grid.

Future Prospects for Renewable Energy

The record installations of 2025 lay a strong foundation for future growth and profitability. The newly added capacity—enough to supply power to 6.9 million homes—is expected to generate steady income for renewable energy developers and owners through long-term contracts or market sales. With electricity demand keeping prices stable, profit margins for clean energy providers are likely to improve.

For companies involved in the clean energy supply chain, from manufacturers to system integrators, this deployment boom should lead to increased orders and greater earnings visibility.

However, the outlook is complex. While the ACP reports a record 50 GW added to the grid, a recent Bloomberg article notes that nearly 60 GW of capacity remains delayed due to interconnection and permitting challenges. This significant backlog suggests that the recent surge is not a one-off event, but rather the start of an extended period of growth as companies work to bring these projects online.

The combination of operational achievements and a robust project pipeline is expected to attract investment back to the clean energy sector, restoring confidence in its long-term potential.

Top Clean Energy ETFs to Consider

Given the industry’s renewed momentum, the following clean energy ETFs are well-positioned to benefit:

• iShares Global Clean Energy ETF (ICLN)
  • With $2.04 billion in assets, this ETF provides exposure to 100 companies involved in solar, wind, and other renewables. Its largest holdings include Bloom Energy (BE, 9.68%), a California-based fuel cell innovator; Nextracker (NXT, 8.83%), specializing in smart solar tracking; and First Solar (FSLR, 6.07%), a leading Arizona solar panel manufacturer. U.S. companies make up 39.9% of the fund.
  • ICLN has climbed 55% over the past year, charges a 0.39% fee, and saw 3.88 million shares traded in the last session.
• ALPS Clean Energy ETF (ACES)
  • Holding $111.2 million in assets, ACES invests in a diverse mix of U.S. and Canadian clean energy and technology companies. Top holdings include Albemarle Corp. (6.76%), a major lithium supplier; Enphase Energy (ENPH, 6.72%), a leader in solar microinverters and storage solutions; and NXT (5.84%). The U.S. represents 85.4% of the portfolio.
  • ACES has gained 38.4% in the past year, with a 0.55% fee and 50,000 shares traded recently.
• Invesco WilderHill Clean Energy ETF (PBW)
  • With $492.4 million in market value, PBW tracks 63 U.S.-listed companies focused on clean energy and conservation. Its top holdings are Amprius Technologies (3.00%), a California battery maker; Darling Ingredients (2.65%), a Texas firm converting waste into renewable fuels; and BE (2.47%). U.S. companies comprise 74.5% of the fund.
  • PBW has surged 88.8% over the past year, charges a 0.64% fee, and traded 670,000 shares in the last session.
• First Trust NASDAQ Clean Edge Green Energy ETF (QCLN)
  • With $533.3 million in assets, QCLN invests in 49 U.S. clean energy companies involved in manufacturing, development, and installation of technologies such as solar PV, biofuels, and advanced batteries. Top holdings include BE (11.55%), ON Semiconductor (8.77%), an Arizona-based power semiconductor provider, and Tesla (TSLA, 8.19%), the Texas-based EV giant.
  • The fund is heavily weighted toward U.S. companies. QCLN has advanced 55% in the past year, charges a 0.56% fee, and traded 140,000 shares in the last session.

Enhance Your Investment Strategy with Expert ETF Analysis

Subscribe to Zacks’ exclusive Fund Newsletter for weekly updates, expert analysis, and top-performing ETF picks delivered directly to your inbox.

This valuable resource is available at no cost—don’t miss out!

Sign up now >>

Looking for the latest stock recommendations from Zacks Investment Research? Download the 7 Best Stocks for the Next 30 Days for free. Get your copy here