Filed under: mercebank.com
By Sam Hopkins Thursday, October 2nd, 2008
http://www.greenchipstocks.com (http://www.greenchipstocks.com/newsletter.php?date=2008-10-02)
From all the chatter on television, you wouldn't know the most important thing Congress did for the country this week.
The Senate finally pushed through major renewable energy legislation in its bailout package, with tax credits that will stimulate economic growth and stocks.
As Green Chip editor Nick Hodge wrote yesterday before the Senate's passage of the financial system rescue bill in his Grid Parity blog (http://www.greenchipstocks.com/archives/grid-parity), we are set for:
A one-year extension of the production tax credit (PTC) for wind installations
An 8-year extension of the investment tax credit (ITC) for solar and
removal of the prior $2,000 cap for residential solar installation
Nick pointed out great profit opportunities ahead in several individual equities like SunPower (NASDAQ:SPWR), Evergreen Solar (NASDAQ:ESLR), and Canadian Solar (NASDAQ:CSIQ).
I'll add that since the market trends we see in individual countries feed companies based all over, positive moves in the U.S. should help our international green energy watch list of Chinese companies JA Solar (NASDAQ:JASO), Yingli Green Energy (NYSE:YGE) and Renesola (NYSE:SOL).
But, friends, the path to those profits runs through Capitol Hill, which lately has been a tough climb.
Renewble Energy Incentives... From First Priority to Third Prong
Rather than making renewable energy incentives the top priority in a separate measure, as was the original plan for Energy Improvement and Extension Act of 2008 (H.R. 6049), we now have Bloomberg calling clean tax credits the "third prong" of the restructured rescue plan's massive new section on taxation.
H.R. 6049 included renewable tax credits that had been proposed by the lower house of Congress eight times before, and at the end of September the Senate finally went for it. But then the House changed the bill up to include a pay-as-you-go system that, though logical, broke the bicameral deal by knocking off necessary Senate votes. That blocked the legislation and upward market movement we expected to see.
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