Here Comes the Sun

A solar cynic would point out that power from the sun provides only 0.04% of today's global energy supply. While that may seem less than impressive, remember that solar power can still expand, taking a lot of market share away from the remaining 99.96% of the world's other energy sources.

With that in mind, I'd like to note two big deals announced late last week. First, PG&E (NYSE: PCG  ) intends to buy an additional 1,000 megawatts (MW) of solar thermal power over the next five years, doubling its existing commitment to solar power. As I mentioned earlier this summer, I am already fond of PG&E as a cleantech play, thanks to its sizeable investments in solar, wind, geothermal, and wave power.

Second, FPL Group (NYSE: FPL  ) announced that it also plans to expand its solar production. It will spend $2.4 billion to build 300 MW of solar generating capacity in Florida.

Beyond my belief in solar power's ability to grab a larger share of the overall energy market, I like these latest moves. Within the next few years, I think there's a better-than-even chance that Congress will either impose a "cap and trade" system to limit companies' carbon dioxide emissions, or possibly even implement a carbon tax to achieve the same goal. Members of both houses of Congress have introduced legislation seeking to limit carbon dioxide emissions, and several major presidential candidates support some form of global-warming-focused reform. Furthermore, a number of leading corporations -- including General Electric (NYSE: GE  ) , Alcoa (NYSE: AA  ) , and DuPont (NYSE: DD  ) -- are also backing methods to control CO2 emissions.

If some sort of cap-based system were enacted, companies with the foresight to reduce their CO2 footprint ahead of time would be better positioned to weather the ensuing storm. Both PG&E and FPL Group have now taken big steps in that direction. I believe that both companies could be looking at more sunny days ahead, thanks to their ramped-up commitments to solar.

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