Clean energy stocks are surging this morning in the wake of Congressional funding of a broad set of new renewable energy measures. In particular, Clean Energy Fuels (NASDAQ:CLNE) surged nearly 20% this morning and FuelCell Energy (NASDAQ:FCEL) stock was up more than 10%.
Legislation approved late Monday includes a provision advising that the “sense of Congress” is that the Department of Energy must prioritize funding for research to power the country with 100% “clean, renewable, or zero-emission energy sources,” which The Washington Post called “a rare declaration that the nation should be striving toward net-zero carbon emissions.”
One of those sources is renewable natural gas (RNG), which comes from animal, industrial and food waste as opposed to fossil fuels, a decades-long standard. Clean Energy Fuels produces “Redeem,” the market-leading RNG. FuelCell Energy manufactures clean energy fuel cells.
Investors see opportunity in the $35 billion of new funding for renewable technology and energy efficiency in the legislation. Additionally, this legislation should provide a boost to federal energy programs that haven’t seen updates since 2007.
FCEL Stock Benefits From New Global Priorities
In November, Joe Biden won the U.S. presidential election. Biden campaigned on a plan to ensure the U.S. is carbon neutral by 2050, with a 100% clean energy economy. The federal government looks ready to spend $1.7 trillion on clean energy initiatives and infrastructure over the next 10 years.
Also in November, the International Energy Agency (IEA) released a report forecasting that renewable energy deployment is set to surge by 50% over the next five years. The IEA report predicts the cost of hydrogen could drop by 30% over the next decade.
Then, United Nations Secretary-General Antonio Guterres called for a global halt to investment in coal burning power plants. The UN is pushing toward a carbon neutral future with a 2050 target.
Clean energy stocks in general saw gains from this series of announcements.
Clean Energy: A Hypergrowth Sector
Last week, InvestorPlace analyst Luke Lango featured clean energy stocks as the next big hypergrowth investment. “In the midst of a global clean energy revolution wherein essentially every country in the world is aggressively working to cut carbon emissions,” he wrote.
He named CLNE stock — along with Hyliion (NYSE:HYLN) — as two stocks to watch as Wall Street wakes up and realizes the enormous potential of this emerging industry.
On the date of publication, Robert Lakin did not have (either directly or indirectly) any positions in the securities mentioned in this article.
InvestorPlace contributor Robert Lakin is a veteran financial writer and editor, following fintech, agtech and property tech startups.
