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Why Did Bloom Energy Stock Jump 10% Today?
Key Points
Bloom's clean energy is a good match for California power needs.
A new agreement with California Resources Corp. could open new commercial avenues for Bloom Energy.
Increasingly negative sentiment toward data center growth has weighed on the shares of many AI infrastructure stocks. Bloom Energy (NYSE:BE) is a prime example, as its backlog of business is heavily reliant on data center projects. That helps explain why Bloom stock has declined about 25% in just the last month.
Investors are pushing past that negativity today, after word that Bloom signed a new memorandum of understanding (MOU) that could expand the use cases for its fuel cell technology. The news had investors bidding Bloom shares up more than 12% this morning. As of 12:12 p.m. ET, Bloom stock was still up 9.5%.
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The agreement seeks to evaluate the possibility of Bloom providing at least 1 gigawatt (GW) of solid-oxide fuel cell power generation for California Resources Corporation (CRC), to be combined with carbon capture and storage, to power California data centers, and to supplement the power grid for other needs.
California Resources is an independent oil and natural gas exploration and production company focused almost entirely on California. It is the largest in-state producer by volume. Combining Bloom's scalable and clean energy source with CRC's carbon capture and storage expertise could lead to additional business for Bloom.
Aman Joshi, Bloom's Chief Commercial Officer, stated, "Our non-combustion technology makes carbon capture more efficient and economically viable at scale, opening a new path to carbon-neutral power generation and addressing the decarbonization needs of large critical infrastructure."
It's another reason for investors to see a long growth path for Bloom Energy, helping push shares higher today
Howard Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Bloom Energy. The Motley Fool has a disclosure policy.