June 2nd, 2026 | 06:20 CEST
Dividends From Renewable Energy: Brookfield Renewable Partners, RE Royalties and Clearway Energy Offer Investors High Payouts!
Some people forget that we live in a capitalist system. The term itself is derived from capital, and in today's corporate and capital markets, nothing functions without it. In certain industries, however, capital is scarce, investor risk appetite is limited, or business models are not always a natural fit. In many of these sectors—such as oil, mining, pharmaceuticals, or even the music industry—the royalty model has therefore become well established. Financiers provide capital and, in return, receive stable, long-term cash flows from their partners. This business model has now also gained traction in renewable energy, including hydropower, solar, wind, and battery storage. It offers investors relatively stable and comparatively high dividend yields. Against this backdrop, we take a closer look at the stocks of Brookfield Renewable Partners, RE Royalties, and Clearway Energy.
time to read: 6 minutes
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Author:
Tarik Dede
ISIN:
RE ROYALTIES LTD | CA75527Q1081 | TSXV: RE , OTCQX: RROYF , CLEARWAY ENERGY C DL-_01 | US18539C2044 , BROOKFIELD RENEWABLE PARTNERS LP | BMG162581083 | NYSE: BEP , TSX: BEP.UN
Table of contents:
Author
Tarik Dede
Even as a high school student in northern Germany, he developed a strong interest in the “Neuer Markt” and the dynamics of the equity markets. Small- and mid-cap companies were at the center of his focus from the very beginning. After completing his training as a certified bank clerk, he deepened his economic expertise through formal studies in economics as well as through various positions within Frankfurt’s financial sector. Today, he has been actively involved in the capital markets for more than 25 years, both professionally and as a private investor.
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Brookfield Renewable Partners: The Largest YieldCo
Brookfield Renewable is likely the world's largest pure-play renewable energy provider. Its massive portfolio includes hydroelectric plants, wind farms, solar facilities, and large-scale battery storage across multiple continents. The company was founded in its current form in 2011, but its history dates back over 100 years to what is now Brookfield Corporation. With a market capitalization of approximately USD 11.3 billion, the company is now one of the heavyweights in the renewable energy sector. The Canadian company pursues a clear dividend strategy, aiming to increase the payout by 5% to 9% annually.
This is also reflected in the latest quarterly figures from early May. In this context, FFO (Funds from Operations) is far more important than net income. This is because FFO demonstrates Brookfield Renewables' actual cash flow strength and thus provides a realistic picture of the dividend base. In the first quarter, the company benefited from the gradual commissioning of new capacity from its own development pipeline as well as from inflation-indexed price adjustments in existing power purchase agreements (PPAs). While the hydroelectric plants, the portfolio's historic cash cow, delivered stable returns despite weather-related fluctuations, growth came primarily from the solar and wind energy segments (+60%) as well as large-scale battery storage. Here, the company is also a sought-after partner for firms currently building AI infrastructure and data centers in the United States.
Funds from operations totalled USD 375 million between January and March, up 19% from the same quarter last year. This amounts to USD 0.55 per share, resulting in a quarterly dividend of USD 0.392 per share. On an annualized basis, this would be USD 1.568, which translates to a dividend yield of 4.2%. Brookfield's stock has gained more than 30% since the start of the year. With approximately USD 4.7 billion in liquidity, the company is well-financed to continue growing. In addition, "capital recycling" measures are currently being implemented. As part of this program, older assets are being sold off to free up funds for new, higher-yielding investments.
RE Royalties: The Speedboat Among Financiers
RE Royalties stock offers a bit more excitement. The Canadian company has a fundamentally similar and equally established business model in the renewable energy sector. Since its founding in 2016, more than CAD 80 million has been invested in a diversified portfolio comprising over 27 transactions and approximately 135 individual projects. The internal rate of return on these investments has been over 19% since the company's inception. About 41% of the current pipeline comes from existing customers, underscoring the company's reliability. Here, too, the focus is on building a diversified portfolio that generates stable, recurring, and long-term cash flows. In addition to solar and wind farms, battery storage, renewable natural gas, and hydropower, the portfolio also includes energy-efficiency infrastructure projects.
In doing so, RE Royalties relies primarily on two financing structures. On one hand, long-term royalties are acquired in exchange for capital, promising a share of revenue over 20 to 25 years. On the other hand, this approach is combined with short-term bridge loans of 1 to 3 years for the partners, resulting in an additional source of income. The success of this approach speaks for itself. Revenue growth averaged approximately 60% per year over the past five years. RE Royalties benefits from its niche: Since major banks and lenders are primarily interested in very large financing deals in the hundreds of millions, the company steps in to fill the financing gap for smaller projects (CAD 10 to 20 million). And quite quickly at that: as COO Peter Leighton stated at the International Investment Forum (IIF) (see video), capital can in some cases be made available within just a few weeks. In that sense, if Brookfield is the tanker in project financing, then RE Royalties is the speedboat.
https://www.youtube.com/watch?v=5dQvcZkFR7E
Extremely High Dividend Yield
This strategy has made RE Royalties a solid dividend payer. The still relatively young company has been paying a stable quarterly dividend to its shareholders for 2.5 years now. Most recently, 1 cent per quarter was distributed, resulting in a current dividend yield of about 10% (annualized). However, this joy for shareholders does not really make the board happy, as the high yield is only possible due to the low market capitalization of currently about CAD 18 million. And now the action surrounding the stock comes into play. Although management holds approximately 24% of the shares, a strategic review has been initiated to "identify opportunities to maximize value for shareholders."
This involves evaluating a broad range of potential alternatives, including partnerships, co-investments, and even the sale of the company. For this reason, management has commissioned PricewaterhouseCoopers to conduct the strategic review. On one hand, this involves the financing structure. The company is seeking long-term solutions. Until now, it has primarily financed itself through five-year green bonds, while the acquired royalties have terms of 20, 25, or even 40 years. The strategic review is intended to help optimally align the capital structure with these long project terms. On the other hand, a sale of the company is also conceivable. Since management holds a large stake in RE Royalties, a takeover premium is likely in the event of an acquisition.
Clearway Energy: California Slowed Down
From a purely stock market perspective, Clearway Energy is positioned between RE Royalties and Brookfield Renewable. The company currently has a market capitalization of just under USD 5 billion. They are among the largest owners of renewable energy projects in the US. In addition to a strong focus on wind and solar energy, the company operates highly efficient natural gas plants for grid stabilization. Here, too, the electrification of society is the strongest driver, alongside high demand from the expansion of AI infrastructure. And here, too, cash flows are extremely predictable, as the company's own facilities are almost entirely leased under long-term contracts to financially strong energy suppliers or large corporations. The goal is to increase dividends by 5% to 8% per year, if possible.
The NYSE-listed company presented its financial results for the first quarter of 2026 in early May. Clearway Energy reported solid performance in its operating business. However, weak wind conditions in California had a noticeable negative impact on the quarter. Quarterly revenue rose slightly to USD 354 million (+3.6%). New acquisitions helped offset the weakness in the wind sector. The key metric for Clearway Energy's dividend is CAFD, or Cash Available for Distribution. This stood at USD 70 million at the start of the year, down approximately 9% from the prior-year figure. Net income of USD 68 million fell well short of analysts' expectations, primarily due to non-cash mark-to-market valuations of hedging transactions. Important for investors: At Clearway, business is more seasonal than at other providers due to the strength of its solar parks. Typically, achieving annual targets depends on operating performance in the second and third quarters. The company has confirmed its annual forecast. Management now expects a CAFD of USD 470 million to USD 510 million for 2026. By 2030, the company also aims to reach the upper end of its dividend growth target range (5% to 8%+). The stock has roughly doubled since 2023. Based on the current June figure, the annualized dividend stands at USD 1.8704 per share. This translates to an estimated dividend yield of 4.5%.
Anyone looking to invest broadly in renewable energy cannot ignore companies like Brookfield Renewable, RE Royalties, or Clearway Energy. The sector is booming, with demand driven by the expansion of AI infrastructure and electrification. Brookfield offers solid long-term dividend yields. RE Royalties stands out for its high dividend (10%) and takeover potential. Clearway may currently appear somewhat weaker, but this is partly due to seasonality.
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