Energy
Wednesday, September 11th, 2024 4:37 pm EDT
Key Points
- Clean Energy Stock Gains: Solar and clean energy stocks rose significantly on Wednesday following Vice President Kamala Harris’s strong performance in the first debate. The Invesco Solar ETF (TAN) and the iShares Global Clean Energy ETF (ICLN) increased by more than 3% and 2%, respectively. Despite these gains, both ETFs have seen substantial declines this year due to election-related uncertainty impacting the clean energy sector.
- Election Impact Concerns: The upcoming election is seen as a pivotal moment for the clean energy transition. There is concern among investors that a potential Republican victory, especially by former President Donald Trump, could lead to weakening or repealing of the Inflation Reduction Act (IRA). This legislation is critical for clean energy investments and incentives.
- Debate Statements and Policy Outlook: During the debate, Trump criticized Biden’s energy policies but expressed some support for solar energy. Harris clarified that she would not ban fracking, which has boosted U.S. natural gas production. Analysts expect that if Harris wins, the IRA will likely remain unchanged, whereas a Trump presidency might lead to modifications, particularly affecting electric vehicle tax credits.
On Wednesday, solar and clean energy stocks experienced notable gains following the declaration of Vice President Kamala Harris as the likely winner of the first debate ahead of the November election. The Invesco Solar ETF (TAN) and the iShares Global Clean Energy ETF (ICLN) saw increases of more than 3% and 2%, respectively, in morning trading. Despite these gains, both benchmarks have suffered significant declines this year, down 28% and 11% respectively, due to the uncertainty surrounding the election’s impact on the clean energy sector.
Individual clean energy companies also saw substantial gains, with First Solar rising 8%, SolarEdge increasing by 9.7%, Sunnova up by 5%, and Sunrun advancing 8.5%. Analysts, including Raymond James’ Ed Mills, predict a short-term boost for clean energy stocks following Harris’s debate performance, though the long-term implications remain uncertain. Betting markets have also shifted in favor of Harris, though the lead is not significantly different from pre-debate levels, reflecting the continued unpredictability of the election outcome.
The upcoming election is viewed as a critical juncture for the clean energy transition. There are concerns among investors that a Republican victory, particularly by former President Donald Trump, could result in weakening or repealing the Inflation Reduction Act (IRA), a key legislative driver for clean energy investment. Trump has criticized the Biden administration’s energy policies, including a strong stance against fossil fuels and supportive rhetoric for renewable energy sources like solar. Despite his criticisms, Trump has expressed some support for solar energy, albeit in a somewhat dismissive manner.
During the debate, Harris clarified her position on fracking, stating she would not ban the practice, which has contributed to a boom in natural gas production. She emphasized the Biden administration’s investments in clean energy through the IRA, highlighting its role in boosting domestic manufacturing and energy production. Analysts anticipate that the IRA will likely remain intact if Harris wins, while Trump’s potential presidency might lead to targeted changes, particularly affecting electric vehicle tax credits. Despite the uncertainty, solar investments have notably benefitted Republican districts, adding complexity to the policy debate.
For the full original article on CNBC, please click here: https://www.cnbc.com/2024/09/11/solar-stocks-gain-as-wall-street-says-harris-won-the-debate-against-trump.html
