Energy Investors: 2 Disrupting Technologies and 1 Top Stock

While two breakthroughs could change the face of energy investment, Suncor Energy Inc. (TSX:SU)(NYSE:SU) is still a top stock to buy and hold.

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Two breakthrough technologies could soon make the world of energy investing look very different. Before we take a look at one of the strongest picks for long-range energy income, let’s review an innovative system that has the backing of one of the world’s richest people, as well as an interesting new take on hydrocarbon fuel that could revolutionize the oil industry.

A new use for oil fields, and a solar revolution

Imagine if oil sands could be used for something other than oil. A new technique could do exactly that, presenting an alternative to the question of how to drain the oil patch.

Rather than sticking to traditional oil production methods, a large scale system of hydrogen extraction could transform the West into a major source of environmentally friendly fuel.

Proton Technologies is commercializing the new technique, which draws the hydrogen from the oil fields while leaving the carbon behind. The idea would be to utilize existing infrastructure but repurpose oil fields to produce a less environmentally damaging fuel source. The sites could even be self-powered, using a fraction of the hydrogen to power the oxygen production plants.

Meanwhile, a clean energy company called Heliogen could be on the verge of revolutionizing solar power. Its technique uses a combination of artificial intelligence and mirrors to generate immense heat and has the backing of Bill Gates.

Aiming to produce carbon-free energy, if Heliogen can convince more backers and scale up, the company could becoming a major contender in the renewables space and may even go public.

The twin breakthroughs are emerging as coal faces a record decline this year, with a projected 3% fall; 3% is also the amount that coal added to total added CO2 last year, which made up for an estimated 50% of increased fossil fuel emissions for the whole of 2018.

Coal-fired electricity production is one of the major causes of hydrocarbon-linked temperature change, and is targeted by the Paris Agreement.

A top stock for passive income

Uncertainty has been driving investment in energy heavyweight Suncor Energy (TSX:SU)(NYSE:SU). Known for its low volatility and reliable dividend and a strong track record of payment hikes, Suncor is a solid long-term play in a defensive sector and pays dependable 4% yield.

Cash flow is one of Suncor’s strong suits, as would befit a titan in the world of Canadian energy. Pulling in $1 billion in its Q3, Suncor is punching lower that it did a year ago, though it remains a veritable force of nature. This is of the utmost importance at the moment to any investor seeking quality and long-term peace of mind.

Suncor is also diversified across asset types, ticking a few boxes for renewables investors with its involvement in wind and biofuel. Having ditched 7% this year as investors eye the oil space with caution, Suncor’s value has widened, making this a decent play on weakness.

The bottom line

While two breakthroughs could change the face of energy investment, Suncor is still a top stock to buy and hold. Heliogen could be the breakout IPO that the markets have been waiting for, and if the solar energy company does decide to go public its stock is bound to be instantly popular with the green economy investment crowd.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Victoria Hetherington has no position in any of the stocks mentioned.

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