Shares of several renewable energy stocks are on the rise on Wednesday after the White House released a fact sheet with details of President Biden's plan to rebuild the country's infrastructure, "The American Jobs Plan." Noting that the President is proposing a 10-year extension and phase down of the Investment Tax Credits, or ITC, and Production Tax Credits, or PTC, and the bill also includes the creation of a tax credit to incentivize the buildout of at least 20GW of high-voltage capacity power lines, Roth Capital analyst Philip Shen said he expected renewable energy stocks to trade up on the release.
'AMERICAN JOBS PLAN': On Wednesday, the White House released a fact sheet with details of President Biden's plan to rebuild the country's infrastructure, "The American Jobs Plan." According to the fact sheet, "the President’s plan will unify and mobilize the country to meet the great challenges of our time: the climate crisis and the ambitions of an autocratic China. […] Specifically, President Biden’s plan will: Fix highways, rebuild bridges, upgrade ports, airports and transit systems; Deliver clean drinking water, a renewed electric grid, and high-speed broadband to all Americans; Build, preserve, and retrofit more than two million homes and commercial buildings, modernize our nation’s schools and child care facilities, and upgrade veterans’ hospitals and federal buildings; Solidify the infrastructure of our care economy by creating jobs and raising wages and benefits for essential home care workers; Revitalize manufacturing, secure U.S. supply chains, invest in R&D, and train Americans for the jobs of the future; Create good-quality jobs that pay prevailing wages in safe and healthy workplaces while ensuring workers have a free and fair choice to organize, join a union, and bargain collectively with their employers."
Alongside his American Jobs Plan, President Biden is releasing a Made in America Tax Plan. "President Biden believes that profitable corporations should not be able to get away with paying little or no tax by shifting jobs and profits overseas. President Biden’s plan will reward investment at home, stop profit shifting, and ensure other nations won’t gain a competitive edge by becoming tax havens," the fact sheet reads.
"Through investments in the grid, we can move cheaper, cleaner electricity to where it is needed most. This starts with the creation of a targeted investment tax credit that incentivizes the buildout of at least 20 gigawatts of high-voltage capacity power lines and mobilizes tens of billions in private capital off the sidelines – right away. […] President Biden is proposing a ten-year extension and phase down of an expanded direct-pay investment tax credit and production tax credit for clean energy generation and storage," according to the fact sheet.
RENEWABLE ENERGY STOCKS TO TRADE UP: Commenting on the fact sheet released by the White House, Roth analyst Philip Shen highlighted that the President is proposing a 10-year extension and phase down of the ITC and PTC including a credit for storage. There appears to be a direct pay option, he added. The analyst pointed out that also included is the creation of a tax credit to incentivize the buildout of at least 20GW of high-voltage capacity power lines, which could support utility scale solar and wind installations. Shen looks for renewable energy stocks to trade up on the release. In a previous research note, the analyst said an ITC extension could serve as a positive catalyst for the solar sector.
PRICE ACTION: In afternoon trading, shares of Enphase Energy (ENPH) have jumped almost 8% to $162.02, while Sunworks' (SUNW) stock has soared over 15% to $14.95. Also higher, Bloom Energy (BE) has advanced more than to 6% to $26.82, Plug Power (PLUG) has gained about 3% to $35.05, and SolarEdge (SEDG) has jumped almost 6% to $287.11.
OTHERS TO WATCH: Publicly traded companies in the infrastructure space include Aecom (ACM), CB&I (CBI), Caterpillar (CAT), Eagle Materials (EXP), Fluor (FLR), Granite (GVA), Jacobs Engineering (J), Martin Marietta (MLM), Quanta Services (PWR), U.S. Concrete (USCR) and Vulcan Materials (VMC).
Enphase Energy
+12.88 (+8.55%)
Sunworks
+2.36 (+18.22%)
Bloom Energy
+1.81 (+7.17%)
Plug Power
+1.48 (+4.35%)
SolarEdge
+17.8 (+6.57%)
Aecom
-0.45 (-0.69%)
CBI
+
Caterpillar
-0.75 (-0.32%)
Eagle Materials
-0.06 (-0.04%)
Fluor
+0.55 (+2.41%)
Granite
+1.08 (+2.75%)
Jacobs
+1.39 (+1.09%)
Quanta Services
+1.1 (+1.26%)
USCR
+
Vulcan Materials
-1.89 (-1.10%)
Martin Marietta
-2.65 (-0.77%)