The sun was shining brightly on Solaredge Technologies (SEDG +5.18%) stock as the trading week came to a close on Friday. Investors piled into the stock on news that an important group of energy consumers were lobbying the government to maintain the existing rules for clean energy subsidies.
Solaredge's share price swelled by more than 17% as a result, providing a night-and-day contrast to the benchmark S&P 500 index's 0.3% decline.
A rather sunny development
On Friday, an industry association called The Data Center Coalition formally asked U.S. Treasury Secretary Scott Bessent to uphold the existing framework under which wind and solar projects receive federal subsidies.
Image source: Getty Images.
Next week is the deadline set by President Trump for his administration to reset the rules governing the subsidies. It's almost a certainty that government officials will make them harder to obtain.
In its request, the coalition wrote that "any regulatory friction that slows down deployment of new generation today directly impacts our ability to meet AI-era electricity demands tomorrow."
Data centers are set to become an increasingly important customer grouping for the energy industry as a whole. Already vast consumers of power, they are greatly intensifying their demand because of the proliferation of artificial intelligence (AI), a collection of technologies that require considerably more resources than longer-established IT functionalities.
NASDAQ: SEDG
Key Data Points
A mighty coalition
The coalition isn't a vague and fairly anonymous collection of lightweight businesses. It consists of some of the most powerful tech and financial companies moving the U.S. economy: Alphabet's Google is a member, as are Amazon Web Services and Visa.
Given the collective power these companies wield, their message is sure to find an audience -- and perhaps affect the government's decision for the better.
