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5 Best Solar ETFs to Buy in Q4 2025
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Solar ETFs are funds that invest in a wide selection of stocks operating in the alternative energy sector. The most popular and common industry in this sector is solar energy. Our expertly selected guide highlights five of the best solar ETFs right now.
What are the top solar ETFs to buy?
Copy link to sectionThere are many ETFs to choose from, but we’re here to help you make a decision. That’s why our experts have analysed the market and found five of the most promising solar ETFs for 2021 which you can find listed below.
| # | ETF symbol | ETF name | Learn more |
|---|---|---|---|
| 1 | TAN | Invesco Solar ETF | Learn more > |
| 2 | QCLN | First Trust NASDAQ Clean Edge Green Energy Index Fund | Learn more > |
| 3 | GRID | First Trust NASDAQ® Clean Edge® Smart Grid Infrastructure Index Fund | Learn more > |
| 4 | ICLN | iShare Global Clean Energy ETF | Learn more > |
| 5 | PBW | Invesco WilderHill Clean Energy ETF | Learn more > |
1. Invesco Solar ETF (TAN)
Copy link to section- Assets: $994 million
- Expense ratio: 0.67%
- Year of inception: 2008
- 5-year performance: 42%
- Dividend yield: 0.11%
The Invesco Solar ETF tracks the MAC Global Solar Energy Index which includes companies that produce solar energy. There are only 32 holdings in this ETF focusing on USA based and China based companies, although other locations are included.
Its top three holdings are First Solar, Enphase Energy Inc, and SunRun Inc. It is considered a mid-cap ETF as the average market cap of its portfolio is about $7.8 billion. However, it includes many small cap stocks in Europe and emerging markets globally.
It takes the top spot on our list due to historical growth and future prospects. Just over 25% of the ETF is made up of 3 companies, while almost 50% belong to USA based businesses. The past five years has seen an average gain of over 42% but it has dropped by 8% in the past decade.
2. First Trust NASDAQ Clean Edge Green Energy Index Fund (QCLN)
Copy link to section- Assets: $712 million
- Expense ratio: 0.59%
- Year of inception: 2007
- 5-year performance: 61%
- Dividend yield: 0.81%
Second on our list is an ETF that only invests in companies that are located in the United States. The First Trust NASDAQ is not explicitly solar focused, as other companies in the clean energy sector are featured, however it does include many solar based businesses.
The ETF tracks an equity index called the NASDAQ Clean Edge U.S. Liquid Series. The index is designed to to track the performance of clean energy companies publicly traded in the U.S.
Its biggest constituents are companies like Tesla, ON Semiconductor, First Solar, Enphase Energy, and Rivian. Other big names are the likes of Acuity Brands, Brookfield Renewable Partners, and Universal Display.
3. First Trust NASDAQ® Clean Edge® Smart Grid Infrastructure Index Fund ETF (GRID)
Copy link to section- Assets: $1.45 billion
- Expense ratio: 0.57%
- Year of inception: 2009
- 5-year performance: 140%
- Dividend yield: 1.08%
The First Trust NASDAQ® Clean Edge® Smart Grid Infrastructure Index Fund ETF is a popular fund that tracks the Nasdaq Clean Edge Smart Grid Infrastructure Index. This fund tracks companies in the utilities sector, with other constituents being manufacturers of electric meters, networks, and energy storage solutions.
As a result, this fund is not necessarily a solar energy ETF. However, it owns some solar companies in the fund are the likes of Enphase Energy, Tesla, and Solar Edge. Other companies in the fund are the likes of ABB, National Grid, Schneider Electric, and Eaton Corporation.
4. iShare Global Clean Energy ETF (ICLN)
Copy link to section- Assets: $2.28 billion
- Expense ratio: 0.41%
- Year of inception: 2008
- 5-year performance: 1.59%
- Dividend yield: 25%
The largest renewable energy ETF available at the moment takes the fourth place on our list. It holds assets worth over $2.3 billion, came to market back in 2008, and has seen steady growth since then.
ICLN is not a solar ETF. Instead, it is a fund that tracks companies across all areas of renewable energy, including wind, solar, and hydro. Most of the companies in the fund are utilities followed by technology, industrials, and basic materials.
The top names in the fund are First Solar, Enphase Energy, Iberdrola, Consolidated Edison, and Vestas Wind Systems. Unlike the other companies in this list, this one has names from the United States, Denmark, China, Japan, and other countries. It is a good fund to invest in if you are interested in the clean energy sector and is fairly cheap with an expense ratio of 0.41%.
5. Invesco WilderHill Clean Energy ETF (PBW)
Copy link to section- Assets: $300 million
- Expense ratio: 0.66%
- Year of inception: 2005
- 5-year performance: -31%
- Dividend yield: 3.22%
The final place on our top five list goes to the WilderHill Clean Energy ETF by Invesco. It’s the third most held ETF in the alternative energy sector and tracks the WilderHill Clean Energy Index.
It’s one of the most well diversified ETFs, comprising 72 different stocks, each of which makes up 2% – 3% of the portfolio. Unlike other ETFs on our list, by spreading the money almost equally across all the stocks it owns, it aims to provide stability and access to the whole clean energy industry.
Solar stocks feature to some degree in this ETF. Its largest holding is a solar company featured in others on our list, Enphase Energy, a technology company that designs and manufactures solar generation home solutions. It also holds other solar companies like First Solar and Enovix.
Where to buy the best Solar ETFs
Copy link to sectionYou can sell and buy ETFs in the same way as any normal stock. That means that before buying shares in an ETF you will need to sign up to a broker. The table below shows some of the best brokers offering ETFs. You can click the links and sign up in just a few minutes.
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What is a solar ETF?
Copy link to sectionAn ETF is an investment fund that is available to buy on the stock exchange. You are able to buy shares in an ETF through a stock broker. Each fund is designed to track the performance of a particular index or industry.
Solar ETFs are exchange traded funds that give investors access to companies in the solar energy sector. This doesn’t specifically mean companies that produce energy from the sun. Any company involved in the solar industry can be included in a solar ETF. There are not many pure solar ETFs around, however the solar industry does make up a large part of clean or renewable energy ETFs.
Are solar ETFs a good investment?
Copy link to sectionIn a word, yes. Climate change has been pushing companies and consumers to cleaner energy sources for years, and in recent times even more. Generating energy from the sun is an industry that is almost certain to grow in the coming decades.
A report from Bloomberg in 2020 confirmed this, when it forecast $4.2 trillion of new solar investment by 2050. By 2040 its expected solar will be the largest source of global electrical capacity with over 35% more installed capacity that natural gas.
However, 2050 is still a long way ahead, so investing in solar ETFs are most suited for a longer term investor, who is happy to wait for their rewards. If you are ready to jump into solar ETFs, you can click the link below which will take you to a list of highly regarded brokers.
Methodology: How we choose the best solar ETFs
Copy link to sectionAt Invezz, we are dedicated to helping investors make informed decisions by providing authoritative, accessible, and engaging advice and recommendations. Our curated section of the best Exchange-Traded Funds (ETFs) is carefully selected by our team of experienced market analysts and reviewed by a sub-editor. This methodology outlines the rigorous process we follow to ensure our ETF recommendations are up-to-date, reliable, and insightful.
- Analyst research & recommendations: Our seasoned market analysts use their in-depth sector knowledge to identify ETFs with strong potential, ensuring they meet high standards of performance, liquidity, and market potential.
- ETF evaluation: We evaluate ETFs based on their underlying assets, historical performance, expense ratios, and tracking accuracy, alongside macroeconomic factors and sector trends.
- Fund performance reports: We assess ETFs through the latest performance reports, analyzing key metrics like returns, volatility, expense ratios, and assets under management (AUM).
- Sector analysis and external recommendations: Our detailed sector analysis, combined with recommendations from reputable sources like Barron’s and Zacks, provides an additional layer of validation for our selections.
- Quarterly review & refresh: We update our curated ETF list quarterly, re-evaluating each ETF based on the latest reports, industry developments, and market conditions to ensure our recommendations reflect the most current information available.