Nuclear energy stocks surge as Biden administration relaxes hydrogen production regulations

From Investing.com: 2025-01-03 13:23:32

Constellation Energy and other nuclear power-focused companies saw a boost in shares after the Biden administration eased tax-credit rules for hydrogen production. The final rules for the Inflation Reduction Act now allow nuclear power plants at risk of retirement to produce clean hydrogen. This development positions the US as a global leader in green hydrogen.

Tech companies’ demand for electricity for AI development has led to a resurgence in nuclear power. Constellation Energy shares rose by 3.8%, Vistra’s stock by 7%, and NextEra Energy by 1.2%. NextEra Energy Partners and Plug Power also saw increases. The Inflation Reduction Act had broadened tax credits for renewable energy projects.

Constellation Energy CEO Joe Dominguez praised the US Treasury Department’s decision to allow the merchant nuclear fleet to earn credits for hydrogen production. Analysts believe the new rules will boost investment in clean hydrogen, benefitting companies like Constellation, Public Service Enterprise Group, and Vistra in the long term. Constellation secured an $840 million contract for nuclear energy supply.

Investing in clean hydrogen projects had been on hold due to uncertainty, but the new rules are expected to encourage investment. The positive market response on Friday followed Constellation Energy’s 8% rise on Thursday after securing a significant contract. The revised rules provide certainty for hydrogen producers and support the growth of green hydrogen in the US.



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