Let’s Get Windy

Hey Influence Traders,

What a weekend – I hope that everyone had a great one!

Highlights

        • The NCAA basketball tournament saw upsets – I love upsets.
        • I built new bedroom furniture. Apparently my wife didn’t read the fine print about assembly required. I didn’t love that.
        • The Suez Canal is unplugged, which means goods can start flowing, and that’s a relief to oil companies and those relying on global supply chains.
        • The fallout from this boating debacle on supply chains and the world economy has yet to be seen.
        • In case you didn’t notice, the announcement came just in time for Monday morning’s market open.
        • Convenient!
        • Bitcoin and other cryptos rose after Visa (Ticker: V) announced that it will use a stablecoin backed by the U.S. dollar to settle transactions on its payment network.

Infrastructure Bill Confirmed

The Biden administration confirmed what I mentioned on last week’s Option Pit Round Robin – its infrastructure plan will be released in two parts.

Part 1 will include at least $1 trillion for roads, bridges, rail lines, electric-vehicle charging stations, and the cellular network, with a focus on a shift to “green” programs.

Part 2 will propose benefits for workers, including free community college, universal pre-kindergarten and paid family leave.

To pay for the plan, the administration has floated issuing a new set of bonds, a carbon tax and an increase in gasoline taxes …

Transportation Secretary Pete Buttigieg has put forward an idea to tax Americans for each mile they drive as a way to fund infrastructure spending.

While Republicans have indicated they will oppose the plan, Democrats are willing to use their control of both houses to pass bills on their own.

Green Infrastructure

The administration has made it clear that infrastructure spending will be used as a catalyst to transition America to a green economy.

Infrastructure Spending will Include Wind

Wind farms and solar panels are key components to building out a clean energy grid.

The first commercial offshore wind farm in the U.S. was the Block Island Wind Farm, a five-turbine project located off Block Island, R.I, in the Atlantic Ocean. 

On Monday, the administration announced a plan to expand the use of offshore power along the East Coast.

The plan designates an area between Long Island and New Jersey as a priority offshore wind zone and sets a goal of installing a farm large enough to power 10 million homes. 

This follows last month’s approval by the administration to build the nation’s first large-scale offshore wind farm off Massachusetts, which will include 84 large turbines.

A number of other offshore projects have been proposed that could see 2,000 turbines installed in the Atlantic.

The farms will need to be installed and connected to the energy grid, of course. And there are leaders in the space that should benefit from a large infrastructure spend.

I’m keeping my eye on these names …

        • General Electric Co. (Ticker: GE) and Siemens A.G. (Ticker: SIE) are two of the world’s largest installers of wind turbines. SIE has installed over 100 gigawatts worldwide through 29,000-plus turbines.
        • TPI Composites Inc. (Ticker: TPIC) manufactures and services composite wind blades for turbines. TPIC reported a 30.6% increase in operating income in Q4 2020 on a 10.3% year-over-year increase in sales.
        • Ørsted Offshore North America (Ticker: ORSTED) develops, constructs, and operates offshore wind farms. ORSTED operates the Block Island Wind Farm and has a good shot of getting other East Coast projects.

Cutting Through the Noise for You.

Frank

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