Renewable energy and clean tech companies and exchange traded funds (ETFs) are getting the boost they need to put their plans into action. President Barack Obama has allocated $2.4 billion toward the sector in yesterday’s budget.
Obama’s new clean energy budget dusts the old one, which had just $113 million allocated to renewable energy initiatives, reports Laura Isensee for Reuters. Although the money has increased, criticism remains.
J.P. Morgan analyst Christopher Blansett said that measures in the budget, such as $500 million in credit subsidies for energy efficiency and renewable energy projects, do not account for much in the “big picture perspective.” [Will it be enough to rally green energy jobs?]
Nevertheless, indexes reacted positively to the allotted cash. The WilderHill Clean Energy Index, which includes solar power companies, battery maker A123 Systems and other clean energy companies, closed up nearly 3% on Monday. [Other ways to play energy with ETFs.]
For more stories about alternative energy, visit our alternative energy category.
Kevin Grandia at Energy Boom Policy has a breakdown of the areas earmarked for money in the budget:
- Smart Grid: $144 million for research, development and demonstration activities to modernize the grid. This includes smart-grid technologies that will spur the transition to a smarter, more efficient, secure and reliable electric system. Vanguard Utilities (NYSEArca: VPU).
- Clean Energy: $500 million in credit subsidy to support $3 billion to $5 billion in loan guarantees for innovative energy efficiency and renewable energy projects. PowerShares WilderHill Clean Energy (NYSEArca: PBW).
- Biofuels: About $220 million has been allocated for biofuels and biomass research and development. PowerShares DB Agriculture (NYSEArca: DBA); holds soybean, corn and wheat futures.
- Coal: $545 million for advanced coal climate change technologies to focus resources to develop carbon capture technologies with broad applications to advanced coal power systems, existing power plants and industrial sources. Market Vectors Coal (NYSEArca: KOL).
- Nuclear Programs: $793 million for clean energy activities and civilian nuclear energy programs, including research and development and infrastructure programs. The money also covers a new research program to address technology needs for the production of nuclear energy. Market Vectors Nuclear Energy (NYSEArca: NLR)
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