The solar industry has struggled mightily for years to achieve meaningful growth and post net profits. During the Biden administration, the green energy sector as a whole received something of a break in the 2022 Inflation Reduction Act, with a slew of tax incentives for building out alternative-energy solutions.
In its attempt to reverse this, President Donald Trump has tasked his administration to make the current subsidies harder to obtain. Thankfully for green energy companies, a theoretically influential lobbying group stepped in on Friday to push back against this effort. Numerous solar stocks popped on the news, including First Solar (FSLR 10.99%), which rose a sturdy 11% by market close.
A mighty lob by a lobbying group
The business grouping behind Friday's pushback is the Data Center Coalition. News broke that the coalition sent a formal request to Treasury Secretary Scott Bessent to maintain the subsidy policy as it is, rather than changing it.
Image source: Getty Images.
The organization -- which lists as members Amazon, Oracle, and CoreWeave, among other prominent tech companies -- told Bessent that any regulatory roadblock limiting green energy solutions will hamper the development of artificial intelligence (AI).
Many data center operators are currently building out their facilities to handle the vastly increased resource demands of AI. To do so, they require more energy, hence their support of renewable sources like solar.
Does the silence speak volumes?
Bessent hasn't yet publicly responded to the coalition's lobbying effort, nor has anyone else in the Trump administration. But investors seem convinced that they've not only digested the letter, they're taking it seriously, since the organization behind it has many prominent members who drive the U.S. economy.
