KUALA LUMPUR, 22 October 2025 — Green energy stocks are witnessing a strong resurgence, with the Green Total-Return Index (TRI) recording its best six-month performance since 2021. After a steady first half of the year, the TRI jumped by approximately 35 percent, prompting Rystad Energy to pose an important question: Is green energy entering a new growth cycle?
Artem Abramov, Deputy Head of Analysis at Rystad Energy, underscored the sector’s surprising strength:
“By all accounts, the economic and policy-driven firestorm of 2025 should have kept green energy stocks flatlined, but the opposite has happened. The green energy index is up by a staggering 40% in 2025, outperforming the broader market by 25% and leaving most upstream oil and energy indexes far behind.”
According to Rystad, this renewed strength reflects fundamental shifts, particularly the prioritisation of global energy security and the rapid adoption of clean technologies, fuelled by accelerating advances in low-carbon innovation.
However, perspective remains important. The index lost nearly 60 percent of its value between 2022 and 2023, and its current rebound still sits about 40 percent below its 2021 peak. Yet, over six years, the index has more than doubled, positioning green energy among the top-performing market segments in recent years.
The sector’s resilience was tested earlier this year following the US “Liberation Day” address on April 2 and subsequent trade tariff announcements. Initially less sensitive than oil and gas, green stocks later suffered sharper declines than the broader market, highlighting vulnerabilities in cross-border feedstock flows and China’s dominance in solar and battery supply chains.
After rebounding broadly between May and July, green energy stocks pulled decisively ahead over the past two months. The entire 25 percent year-to-date outperformance over the S&P 500 has emerged since mid-August.
The RE Green Energy Index, which tracks 83 major players, now stands at around 82, a level last seen in Q3 2023. Gains have been concentrated among the top 15 firms, which account for about 70 percent of the total value. Recent momentum has been driven largely by CATL, Doosan, Sungrow, and Bloom Energy. Excluding these high performers, the recovery has been more modest, though the index still advanced roughly 20 percent over the past six months.
Adding to the optimism, private equity firms and specialist investors have intensified renewable-energy deal activity since 2023. Unlike the exuberant rally of 2020–2021, fuelled by hype and speculation, this new phase appears to be grounded in stronger fundamentals and a sharper focus on long-term energy security.
The 35 percent TRI gain in Q3 2025 could mark the beginning of a new growth cycle. Still, volatility is expected to persist, and with the index heavily weighted toward a handful of dominant players, future gains are likely to remain uneven.
