Alternative energy dominate February's Top ESG ETFs list

Green Energy ETFs topped the Best ESG ETF list in Europe and America in February, the most turbulent month we have seen for a long time. Find out below why these ETFs made the list.

Alternative energy (including clean energy) stocks rise on soaring dirty fuel prices

The Russia-Ukraine war has triggered a burst of interest in alternative energy stocks after the prices of fossil fuels shot through the roof. In February, the S&P Global Clean Energy Index jumped +11.7%, the MAC Global Solar Energy Index Total Return rose +10%, and the Solactive Wind Energy Index gained +8.23%. The Solactive Global Hydrogen Index which tracks stocks engaged in the advancement of the global hydrogen industry also got a piece of the action — up +15.17% over the same period.

In Europe for oil and natural gas doubled

Western countries have fought back with severe sanctions on Russia — an energy commodity powerhouse responsible for 17% of global natural gas production, 12% of oil production, and 40% of Europe’s natural gas imports (EIA, EUROSTAT). Consequently, the prices of Brent oil and crude oil WTI futures rose +10.72% and +8.59% respectively in February while European and UK Natural gas prices doubled. Moreover, pent-up demand for coal in Europe sent futures contracts higher. The Newcastle coal futures and ICE Rotterdam coal futures skyrocketed by +80% and +166% respectively last month.

Nuclear Energy steps into the limelight

Uranium futures also crossed the $50 threshold per pound, a level not seen since September 2021 as nuclear energy steps into the limelight. President Emmanuel Macron said that France would construct as many as fourteen new nuclear power plants to ensure energy independence while increasing its carbon-free energy production capacity. Meanwhile, Germany's economy minister said that the country is considering whether to extend the lifespan of its remaining three nuclear power plants to secure the country's energy supply in the face of uncertainty over Russian gas supplies. Europe's strongest economy and the most populous country had plans to completely phase out nuclear energy this year.

Is it time to say goodbye to fossil fuels?

Investors consider the recent development as the final straw that will prompt fossil fuel-dependent nations to ramp up their investments in renewable energy and cut their reliance on oil and gas. ETFs with exposure to clean energy, solar, wind, uranium, and hydrogen stocks have been tagged — highlighting the top-performing ESG ETF list in February.

Top ESG ETFs in America 

• Horizons Global Hydrogen Index ETF (HYDR): +15.2%
• Horizons Global Uranium Index ETF (HURA): +13.6%
• VanEck Green Metals ETF (GMET): +13.0%
• iShares Global Clean Energy ETF (ICLN): +10.6%
• BMO Clean Energy Index ETF (ZCLN): +10.6%

Top ESG ETFs in Europe

• HANetf S&P Global Clean Energy Select HANzero UCITS ETF (ZERP): +13.1%
• iShares Global Clean Energy UCITS ETF (INRG): +11.6%
• Global X CleanTech UCITS ETF (CTEK): +10.3%
• Invesco Solar Energy UCITS ETF (SOLR): +9.9%
• Global X Renewable Energy Producers UCITS ETF (RNRG): +7.6%

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