This Status Quo Election is Bullish for Utilities

Political parties are usually well down the list of reasons for bull and bear markets. But elections do have consequences, particularly in heavily regulated industries like utilities and energy. Relatively early in my career, the Republican sweep of 1994 elections turned electricity deregulation from existential threat into a growth engine for the industry. And when it all crashed down in the following decade, a similar wave on the state level forged a new regulatory compact to repair balance sheets and restore prosperity. More recently, President Biden signed two extremely bullish pieces of legislation for the power sector. I highlighted opportunities from the Infrastructure and Jobs Act of 2021 in the August 2021 issue, and the considerably larger Inflation Reduction Act of 2022 in this year’s August issue.