Energy reliability and security are at the forefront after Russia’s invasion of Ukraine upended global energy flows, and Goldman Sachs believes companies exposed to these issues will outperform going forward. In other words, it’s not just about clean energy – it’s about reliable clean energy. “We expect that battery storage and hydrogen solutions will continue to receive greater attention from investors, who we believe have yet to fully appreciate their importance in mitigating disruption in electricity markets,” the company said on Monday in a notice to customers. Storage is, in a sense, the missing link between our current energy system and one that is much more reliant on renewable energy. Sun and wind are intermittent sources – if the sun isn’t shining or the wind isn’t blowing, power generation will struggle. This is where batteries come into play. They can store excess energy when the sun is at its strongest and release the stored energy at night. “We believe increasing renewable energy penetration, coal phase-out and expected increase in demand from electrification initiatives such as EV charging will likely increase the focus on energy reliability,” said analysts led by Brian Singer. On the battery storage side, Goldman has buy recommendations for shares of Tesla and Stem. In addition to making electric vehicles, Tesla also makes Powerwall batteries. California-based Stem makes AI-enabled smart storage options. Goldman also favors Enphase and SolarEdge. The companies make specialized inverters for solar systems and also offer energy storage options with a focus on residential buildings. “Around the world, we see several regulatory initiatives that could provide tailwinds to accelerate solutions like battery storage and hydrogen to mitigate energy reliability issues,” the company said. One of the tailwinds is the Inflation Reduction Act that President Joe Biden signed into law on Tuesday. The package includes the most federal funding for climate initiatives in US history. The bill includes a 30% investment tax credit for standalone storage for the first time ever. Previously, the tax credit only applied to storage systems that were built next to a solar system. The bill also includes provisions aimed at encouraging and promoting domestic supply chains for critical materials and battery technologies. On the hydrogen side, Goldman expects greater adoption in Europe, but there are still some US-based companies with exposure, including Baker Hughes with a buy rating. The oilfield services company relies on hydrogen for its infrastructure, distribution and transportation services. The Inflation Mitigation Act earmarks $9.5 billion for green hydrogen initiatives. And in Europe, green hydrogen has been identified as a critical technology in the bloc’s REPowerEU plan. — CNBC’s Michael Bloom contributed to the coverage.