Alternative energy stocks and the corresponding exchange traded funds languished last year when oil prices tumbled, but now that crude is rebounding, it could be time to revisit alternative energy plays such as the First Trust NASDAQ Clean Edge Green Energy Index Fund (NasdaqGS: QCLN).
Clean energy companies advanced Wednesday after Congress extended the solar investment tax credit beyond 2022 with the current 30% level remaining until 2019, reports John Parnell for PV-Tech. The investment tax credit was set to expire at the end of 2016 for residential systems with large projects dropping from the current 30% level to 10%. The industry has already been planning for life after the tax credit.
Related: Clean Energy ETFs Could Rally
While the market for these green energy sectors may be under pressure, clean energy investments broke new records in 2015 and is attracting twice as much global fund as fossil fuels, reports Tom Randall for Bloomberg.
Fueling the growth in renewables, alternative energy technologies are becoming cheaper. Michael Liebreich, chairman of the advisory board for Bloomberg New Energy Finance, pointed out that recent solar and wind auctions in Mexico and Morocco ended with companies that promised to produce electricity at the cheapest amount from any source anywhere in the world.
“But if you want an investment that’s more diversified and a play on the entire renewable industry (and not just on solar), a smart buy now is the First Trust NASDAQ Clean Edge Green Energy Index Fund (QCLN) . With net assets of $63.41 million, the exchange traded fund’s top holdings include Tesla, First Solar, SolarCity, Hexcel, ON Semiconductor and Linear Technology. The expense ratio is a low 0.60%,” according to TheStreet.com.
Related: Bears Target Solar ETFs