We've had false alarms several times before.
Last week, we all thought for sure the expiring tax credits for solar and wind would be renewed when both the House and the Senate passed bills that included extending them.
Turns out, it was all too good to be true.
Here's what happened.
Although each chamber of Congress passed legislation that targeted extending the tax credits, they did so in different bills.
So, for the measure to pass, the differences in the bills would have to be resolved in a conference before they could be passed on the president to sign.
But with all their time dedicated to passing a financial bailout package, both chambers were claiming there was no time to come to a consensus. Not only that, but the Senate said they wouldn't pass the House version, and the House said the same thing about the Senate version.
It appeared as though the responsibility of resolving the tax credit issue—like many other problems we currently face—would be handed off to the next administration.
Now, the Senate has said they'll include:
A one-year extension of the production tax credit (PTC) for wind
An 8-year extension of the investment tax credit (ITC) for solar and
A removal of $2,000 cap for residential solar installation
in the new bailout package to be voted on tonight.
Folks, this is what we've all been waiting for. This thing has a real shot of passing.
To prepare for its passage, you'll want to load up on some of the solar stocks that got absolutely destroyed earlier this week upon the failure of the first bailout package in the House.
You'll want to first take a look at the companies that do business in the U.S. Following stocks are screaming buys:
SunPower (NASDAQ: SPWRA or SPWRB)
Evergreen Solar (NASDAQ: ESLR)
Canadian Solar (NASDAQ: CSIQ)
For hard-hitting profits on this bounce with a little more risk, check out an installer like Akeena (NASDAQ: AKNS) or Clear Skies (OTCBB: CSKH)
Lastly, the Chinese players will also get a push from the momentum in the sector. Plus, in my opinion, these are some of the best solar buys out there anyway.
JA Solar (NASDAQ: JASO)
Yingli Green Energy (NYSE: YGE) and
Renesola (NYSE: SOL)
The anticipated bump from the extension of the tax credits is only the beginning. Buying and holding these stocks will surely offer nice returns for years to come, especially as the use of solar power is significantly ramped up.
Remember, for all the hype surrounding renewable energy right now, it's still in its very nascent stages.
Although, some nice profits stand to be made by traders as well.
I've prepared a full report on how you can profit from the transition to a new energy economy. Be sure to check it out.
Here's to renewable energy profits.