In a rare act of bipartisanship on Capitol Hill, the U.S. Senate on Aug. 10 passed HR 3684, more commonly known as “the infrastructure bill.” The $1.2 trillion package moves to the House of Representatives where passage is also expected.

As has been widely noted, President Biden’s infrastructure effort has implications for an array of assets classes and exchange traded funds, a group including the First Trust Global Wind Energy ETF (FAN). FAN, which tracks the ISE Clean Edge Global Wind Energy Index, is positioned to be an infrastructure beneficiary because the legislation, in its current form, contains plenty of goodies for the wind power industry.

“The bipartisan US infrastructure bill containing $73 billion for modernizing the nation’s grid could prove to be a boon for offshore wind as well as utility-scale wind projects,” according to IHS Markit.

While the infrastructure bill isn’t as expansive on the renewable energy front as some climate and environmental groups were hoping, it does show the White House’s commitment to clean energy and could act as a template for elevated spending on this front going forward. That could work in favor of long-term FAN investors.

Looking to the bill’s near- to medium-term impact on the $391.36 million FAN, the ETF’s depth and methodology could benefit investors. FAN holds 51 stocks, giving a fairly expansive roster for a fund of this type.

Firms in FAN’s index “that are identified as providing goods and services exclusively to the wind energy industry are given an aggregate weight of 60% of the index. Those companies determined to be significant participants in the wind energy industry despite not being exclusive to such industry are given an aggregate weight of 40% of the index,” according to First Trust.

FAN’s diversity and qualifications for admittance are relevant to investors because multiple wind energy concepts stand to win by way of the increased spending.

“Utility-scale and offshore wind farms as well as battery manufacturers are likely to see more immediate benefits from the bill’s passage because electricity infrastructure upgrades will enable easier integration of intermittent renewable generation into the grid,” say Conway Irwin, IHS Markit’s cleantech research director, and Peter Gardett, the company’s cleantech and climate executive director.

FAN is higher by 25.70% over the past year, but resides 17.10% below its 52-week high, suggesting some rebound potential exists with the fund.

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The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.