If a climate bill becomes law, these types of companies will get a boost.
Yesterday, Senate Majority Leader Chuck Schumer and Sen. Joe Manchin unveiled a reconciliation package that would invest billions of dollars to fight against climate change and advance clean-energy programs.
The legislation provides $369 billion for climate and clean energy provisions, making it the most aggressive climate investment ever taken by Congress. The bill aims to cut the country’s carbon emissions by roughly 40% by 2030, according to a summary of the deal released by Senate Democrats.
Agreement details are still unfolding, but spending should include tax credits for clean energy production and faster permitting for clean energy projects. That is a boost for the utility, solar, wind, and electric-vehicle (EV) businesses, among others.
Certain companies will be recipients of these billions pumped into the economy. After news of the deal broke, shares of solar equipment makers Enphase Energy (ENPH) have increased 23% and SolarEdge Technologies (SEDG) have gotten a 12% bump. Shares of utility and renewable power generation leader NextEra Energy (NEE) are up almost 5%.
Barron’s says hydrogen-related stocks are getting a boost too. Shares of Plug Power (PLUG), which makes hydrogen fuel-cell technology, are up more than 30%. And shares of Nikola (NKLA), which is developing hydrogen power trucks for long-haul applications, is up 11%.
General Electric (GE) shares are up 4%, but it also reported a strong quarter, and Vestas Wind Systems stock rose 19% after the news broke.
Data shows that more than half of car buyers want an electric vehicle. The deal includes purchase tax credits, which will likely increase sales of EVs.
“I support a plan that will advance a realistic energy and climate policy that lowers prices today and strategically invests in the long game,” Sen. Manchin said in a statement on Wednesday. “This legislation ensures that the market will take the lead, rather than aspirational political agendas or unrealistic goals, in the energy transition that has been ongoing in our country.”
On prior attempts to pass climate-related legislation, Manchin had been a “no” vote, citing the high level of spending.
“Over the last year, leaders in Washington have ignored repeated warnings about the severe threat of inflation and the consequences of unprecedented domestic spending,” said Manchin in a news release, adding he supports a “realistic energy and climate policy.”
The Senate is set to vote on the Legislation next week where it will then head to the House of Representatives.
