/PRNewswire/ -- Two weeks after President Obama challenged Congress to send him a bill that "places a market-based cap on carbon pollution and drives the production of more renewable energy," House and Senate leaders responded with an ambitious timetable for new "cap-and-trade" legislation, including a final Senate vote by the end of summer.
Under a cap-and-trade system a "price" for emitting pollution into the atmosphere is established but companies are able to freely trade their greenhouse gas emissions in an open market. Burning coal or natural gas to generate electric power becomes more expensive - and renewable sources of energy like wind and solar that much more competitive.
Rep. Henry Waxman (D-Calif.) chair of the Energy & Commerce Committee, said he intends to have a cap-and-trade bill ready by late June. Sen. Majority Leader Harry Reid (D-Nev.) promised comprehensive energy legislation including cap-and-trade laws will be put to a vote this August.
For wind power developers, cap-and-trade legislation is expected to lead to even faster growth in an industry already coming off its best year ever in 2008. Argus Research confirmed its buy rating on AES (NYSE:AES) . AES operates Buffalo Gap, one of the largest wind farms in Texas. Monday analysts at Argus stated AES "continues to have strong growth prospects."
CNBC guest analyst Francis Gaskins has a buy rating on NACEL Energy (OTC Bulletin Board: NCEN) which has four wind projects underway in Texas. Gaskins' research note indicated NACEL "represents a unique opportunity for investors interested in exposure to the sector," and puts a $4 valuation on the Company.
The imminent passage of cap-and-trade laws likely means more solar PV manufacturers will acquire or develop their own power projects. Monday First Solar (NASDAQ:FSLR) bought OptiSolar's pipeline of utility scale projects. Rival SunPower (NASDAQ:SPWRA) announced its own plans for new solar power projects in Florida and California last year. Following First Solar's purchase Lazard issued a buy on the Company and raised its target price to $145.
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