In what environmentalists term a victory for coal and big oil companies, the Senate is scaling back an ambitious energy bill. The Christian Science Monitor reports on the state of the energy bill now:
Congress still has the possibility to pass two measures with wide bipartisan support: the first major hike in vehicle fuel-economy standards since the 1970s and an enormous boost for US-made biofuels. But House provisions for a $21 billion repeal of tax cuts for the oil and gas industry and a mandate for electric utilities to begin using renewable fuels to generate some of their electricity now appear dead.
There is no doubt that as security concerns and cost concerns regarding the use of coal and oil mount, the public is increasingly interested in renewable and alternative energy. The original plan in the Senate energy bill was for tax credits to go to solar, wind and geothermal companies in order to help them increase production. The credits would be paid for by repealing some of the generous credits that big oil companies already enjoy. However, Congress appears unwilling to take that step forward into the 21st Century, choosing instead to continue to reward the outdated energy production of the last century.
ExxonMobile (XOM), First Solar (FSLR) and PowerShares WilderHill Clean Energy (PBW) are all up this morning, mainly due the stock market's favorable trend in anticipation of tomorrow's expected Fed rate cut. Only time will tell how the decision by Congress will affect energy stocks further down the road.
Disclosure: I do not invest in any of the above, although I am interested in PBW.