Trump Administration Requires Tech Firms to Fund $15B Power Generation Plan
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1h ago
0mins
Source: seekingalpha
- Power Auction Initiative: The Trump administration's new plan mandates PJM to conduct an emergency electricity auction, expected to provide at least $15 billion in 15-year contracts for tech companies without their own power generation, addressing soaring electricity prices and reliability risks.
- Impact of Rising Prices: A recent PJM capacity market auction set record-high prices, over 800% higher than last year, prompting political backlash, with Pennsylvania's governor warning of a potential exit from the regional grid if changes are not made.
- Data Center Accountability: The new plan requires data centers to pay for new generation capacity regardless of their actual power usage, shifting more responsibility onto them and potentially increasing their operational costs.
- Market Reaction: Shares of power generators fell sharply, with Talen Energy down 11.3%, while energy equipment manufacturers like GE Vernova and Quanta Services rose due to anticipated new demand, indicating the market's sensitivity to the new policy.
Analyst Views on CEG
Wall Street analysts forecast CEG stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for CEG is 403.30 USD with a low forecast of 347.00 USD and a high forecast of 478.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
11 Analyst Rating
8 Buy
3 Hold
0 Sell
Moderate Buy
Current: 341.200
Low
347.00
Averages
403.30
High
478.00
Current: 341.200
Low
347.00
Averages
403.30
High
478.00
About CEG
Constellation Energy Corporation is a producer of emissions-free energy and an energy supplier to businesses, homes and public sector customers nationwide. The Company’s nuclear, hydro, wind, and solar generation facilities have the generating capacity to power the equivalent of 27 million homes, providing about 10% of the nation’s clean energy. Its segments include Mid-Atlantic, Midwest, New York, ERCOT, and Other Power Regions. Through its integrated business operations, it sells electricity, natural gas, and other energy-related products and sustainable solutions to various types of customers, including distribution utilities, municipalities, cooperatives, commercial, industrial, public sector, and residential customers in markets across multiple geographic regions. It operates approximately 55 gigawatts of capacity from nuclear, natural gas, geothermal, hydro, wind and solar facilities.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
