What happened 

The stock market is having a great day on Tuesday with the S&P 500 climbing 1.4% as of 12:40 p.m. ET and the Nasdaq Composite rising 2.3%. The two biggest news items of the day are the producer price index only rising 0.2% in October, below a 0.4% estimate, as inflation in the wholesale market cools. The other big factor in the rising market is the apparent willingness of the U.S. and China to discuss how to work together. This might not last, but for now, the market is liking recent discussions between the leaders of the two nations. 

Three renewable energy stocks that are on the move today are Plug Power (PLUG -1.54%), which jumped as much as 5.5%; Bloom Energy (BE -6.11%), which rose 5.3%; and Blink Charging (BLNK -0.66%), with a 5.5% pop. The stocks are still 3.4%, 3.5%, and 2.9%, respectively, as I'm writing this. 

So what 

What investors are keyed into today are falling interest rates, which make renewable energy projects more economical to build. In the U.S., the 10-year government bond yield has fallen 3 basis points today to 3.82% and is now down 20 basis points in the past month. 

Renewable energy investors are worried about interest rates because such projects often have high up-front costs during construction and then generate value over decades. So the discount rate investors use to value future cash flows can dramatically change the value of a project today. Lower rates mean higher values today, which is good for these companies.

China is a key piece of the supply chain, so that could be having an impact as well. Companies get components from that nation, even if they're assembling them in the U.S., and China is a major market for nearly every renewable energy industry. 

It'll take years for interest rates and trade changes to work their way to a company's income statement, but that's what the market is looking at today. 

Now what 

The market hasn't been kind to most renewable energy companies over the past year, but these developments could be a sign that sentiment is changing. Interest rates will likely rise over the next few months, but investors who are buying long-term bonds aren't commanding as high a rate as the short-term rate, which is bullish for those borrowing money to build projects. 

What I'll be watching from these companies is their ability to improve margins and get to cash-flow-positive. Building projects is hard with higher rates, but the environment for raising money for a business that's burning cash is even harder. Plug Power, Bloom Energy, and Blink Charging are all burning cash right now, so the first to get to cash-flow breakeven could be the best investment in the long term.