ByCharles Kennedy– Mar 17, 2025, 11:30 AM CDT
Investors are increasingly bearish on renewable energy stocks with green indexes down to five-year lows, as the Trump Administration’s energy policy is chilling the low-carbon energy markets.
Although it was up by 2% year to date as of Monday morning, the S&P Global Clean Energy Transition Index (INDEXSP: SPGTCLEN) has lost 13.5% in the past year.
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The sell-off in renewable energy stocks – already battered by higher costs in a high-inflation environment – intensified after November when U.S. President Donald Trump was elected.
President Trump reversed most of Biden’s energy and climate policies on Day 1, signing a slew of executive orders to boost oil and gas production, expand areas for drilling, withdraw from the Paris Agreement (again), halt offshore wind permits until a review into the economics is made, and eliminate the so-called “electric vehicle (EV) mandate” and the promotion of true consumer choice.
In another sweeping move that halted billions of U.S. dollars in spending, the Trump Administration also froze the Department of Energy’s (DOE) activities pending a comprehensive review of its alignment with his priorities.
The freeze affects grants, loans, procurement, studies, and even personnel decisions, effectively bringing the agency’s $50 billion budget to a standstill.
An earlier Trump directive froze funds tied to former President Joe Biden’s Inflation Reduction Act (IRA) and a bipartisan infrastructure law, both of which allocated billions of U.S. dollars for clean energy initiatives. Trump, who has championed fossil fuels as a cornerstone of his energy policy, has made it clear that climate-focused spending is no longer a federal priority.
The Interior Department has issued a freeze on wind and solar project leases on federal lands and waters.
The Administration is looking to dismantle most, if not all, provisions in the IRA, which has created a lot of uncertainty in the renewable energy markets.
“I have never seen such bearishness in terms of the valuation for companies with structural growth,” Deirdre Cooper, head of sustainable equity at global investment manager Ninety One, told the Financial Times.
By Charles Kennedy for Oilprice.com
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