Yesterday’s announcement that the world’s central banks would step in to help resolve the EU debt crisis, combined with China raising its feed-in payments for renewable electricity, boosted solar and wind stocks for the first time in a long time.
Solar stocks are at all-time lows.
The liquidity added to the system by the central banks will make it easier to finance solar and wind projects and aid short-term demand.
China announced it would double the amount paid for electricity from solar, wind and other renewables. That gives analysts and investors more certainty that project development will continue.
That could translate into 70 gigawatts of wind, assuming half the funding is used, a renewable energy analyst told Reuters.
China requires utilities to buy all the power available from renewable energy producers and can collect additional fees when they sell the energy.
The tariff was raised to cover the premium utilities pay for renewable electricity.
China has a target of 15% renewable energy by 2020.
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