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Renewable energy stocks rose in the second half of December 2007, after the Senate passed a revised energy bill designed to cut the US dependence on imported oil by imposing the biggest increase in fuel-efficiency standards in 32 years. Particularly, the Energy bill raised sixfold the amount of renewable fuels that must be used for blending of products like gasoline, to 36 billion gallons a year by 2022, which gave a strong boost to ethanol stocks.
With the solar and wind-tax benefits set to expire in 2008, analysts expected an extension of federal government support beyond 2008. Nevertheless, a directive for utilities to derive 15% of electricity from renewables by 2020 was omitted from the bill, representing a negative for solar companies.
Despite these, the solar stocks remained strong with a solid outlook for growth, derived mainly from strong demand for photovoltaic panels that is expected to grow by 40% in 2008, high oil prices approaching $100 per barrel and solid support at the States level, where the majority have already established their own alternative energy standards and from the European Union. In addition, analysts expect initiatives that did not pass into the bill to be revisited by Congress in separate bills in 2008.
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Beacon Equity Research Daily Gainers – Etrade Financial (Nasdaq: ETFC), Sirius Satellite Radio (Nasdaq: SIRI), Qualcomm (Nasdaq: QCOM), Tellabs Inc. (Nasdaq: TLAB), Citigroup (NYSE: C), and Washington Mutual (NYSE: WM)
