The 2020 election is approaching, and in 2021 America might see a Green New Deal signed into law.

Note that I didn't say "will," but "might." If President Trump wins reelection, chances of a Green New Deal passing into law seem slim, inasmuch as the president has warned that "it'll kill millions of jobs" and said "I will not stand for it." And to be honest, a full-blown Green New Deal might not pass muster under a Biden Administration, either. 

GREEN NEW DEAL in rainbow colors and all caps

Image source: Getty Images.

Debating President Trump on Sept. 29, Vice President Biden insisted that "the Green New Deal is not my plan" and confirmed that "no, I don't support the Green New Deal." Two weeks later, when moderator George Stephanopoulos asked Biden to confirm his position at a televised town hall meeting, the Vice President responded: "My deal is a crucial framework, but not the new green deal [sic]. The new green deal calls for elimination of all non renewable energy by 2030. You can't get there." 

And yet, if you listen to the vice president's other remarks, it really does sound like he might be in favor of something that's Green New Deal ... ish. This could be very good news for renewable energy companies like Tesla (TSLA 5.05%), First Solar (FSLR -8.07%), and Sunrun (RUN -15.47%).

What Biden says

Vice President Biden may not support the Green New Deal per se, but he clearly does support many green ideas, promising, for example, to:

  • "join the Paris Accord,"
  • "take the federal [car] fleet and turn it into a fleet that's run on ... electric vehicles,"
  • "put 500,000 charging stations in all of the highways" to charge those electric cars,
  • "focus on the transmission of energy across the country from areas relating to solar and wind,"
  • invest in "battery technology ... so you're going to be able to have, for example, solar on your home and a battery ... in your basement," and
  • and "move in a direction where by the year 2035, we'll be able to have net zero emissions of carbon from the creation of energy."

Biden insists that "the future rests in renewable energy," which he says is now "cheaper than coal, is cheaper than oil right now, and it has great, great promise."

Who benefits?

And for the record, it's not just Vice President Biden saying this. As far back as March 2019, Yale University was confirming that "nearly 75 percent of coal-fired power plants in the United States generate electricity that is more expensive than local wind and solar energy resources." What's more, by 2025 -- about the end of a prospective Biden first term -- Yale notes that "enough wind and solar power will be generated at low enough prices in the U.S. that it could theoretically replace 86 percent of the U.S. coal fleet with lower-cost electricity." 

Now, which renewable energy companies should investors be looking at today to reap the benefits of that brighter tomorrow?

As indicated above, I think electric car, battery, and solar roof company Tesla is a great place to start, as it has a finger in most of the key solar "pies" already -- from renewable energy usage all the way up the supply chain through storage and generation. Tesla finally became sustainably profitable late last year, and has now put together four straight quarters of GAAP net profit. Analysts polled by S&P Global Market Intelligence forecast Tesla's profits will continue through the end of this year, giving Tesla its first ever complete-calendar-year profit -- and projections call for the company's profits to only grow bigger as America's "electrification" continues in the years to come.

Tesla may turn into a terrific winner from a pseudo-Green New Deal -- but here at The Motley Fool, we always urge investors to diversify their holdings, and not put all their eggs in any single basket. For this reason, investors might want to also consider buying into solar companies First Solar or Sunrun as well, just to spread out their risk a bit.

Whereas Tesla makes most of its money from electric cars, First Solar specializes in "thin film" solar panel construction. Last week, Goldman Sachs named it one of the banker's favorite solar companies. Coming off of a rough 2019, First Solar has rebounded this year, putting together back-to-back profitable quarters in the first half despite the pandemic. If it continues at its current run-rate, the company could conceivably generate a full-year profit in excess of $435 million, which would give the stock a price-to-earnings ratio of just 20.5 -- considerably cheaper than Tesla's trailing P/E ratio of ... 1,080. 

Meanwhile, Sunrun is making a run at locking up the market for installing solar panels on customer rooftops. The company closed on its merger with Vivint Solar just last week -- and at first glance I have to say that that looked like a mistake, as in recent years Sunrun has done a better job earning profits than Vivint. That being said, when announcing their merger, Sunrun and Vivint predicted that combining their operations would generate $90 million in cost-savings -- possibly enough to turn the merged enterprise profitable again.   

Now add to this potential Vice President Biden's clear preference for renewable energy investments -- and his specific preference to invest in products that are both "clean and new" and "made in America" -- and I see a real potential for investors to profit from U.S.-based Tesla, First Solar, and Sunrun.