The energy sector has historically paid above-average dividends. The industry currently offers a dividend yield of around 4%. That's the highest in the S&P 500 and well above that index's 1.5% yield.

Many energy stocks offer even higher dividend yields, making them even more enticing options for those seeking to collect some passive income. Three energy stocks with big-time yields are Crestwood Equity Partners (NYSE: CEQP), Energy Transfer (NYSE: ET), and Enterprise Products Partners (NYSE: EPD). All of them have the potential to turn $1,000 into a lucrative income stream.

Crestwood Equity Partners currently offers a 10% distribution yield. As a result, the master limited partnership (MLP) can turn a $1,000 investment into a $100 annual passive income stream. That's more than double the roughly $40 of annual dividend income produced from a $1,000 investment in the average energy stock. Meanwhile, it's even further above the $15 in yearly passive income earned by investing that same amount in an S&P 500 index fund.

Continue reading

Source Fool.com