Climate Journalism
Will US Clean Power Be Set Aside As Trump Comes Into Office? What Do Experts Have To Say?
The recent re-election of Donald Trump as the next president of the United States has dented clean energy prospects in the country. The US president-elect is a known climate sceptic who has called efforts to boost clean power as a “scam”.
The recent re-election of Donald Trump as the next president of the United States has dented clean energy prospects in the country. The US president-elect is a known climate sceptic who has called efforts to boost clean power as a “scam”.
On the campaign trail, he repeatedly criticised President Joe Biden’s flagship climate bill – the Inflation Reduction Act (IRA). He called the $370bn federal programme a “green new scam”, and pledged to “terminate” it. Some clean energy projects – both planned and ongoing – have been halted, including Canadian solar manufacturer Heliene, which paused a $150m plan to manufacture solar cells in Minneapolis, Minnesota.
The election sent renewable stocks tumbling. NextEra, America’s largest clean energy company, fell by 5 percent. Plug Power – a hydrogen fuel cell developer – shed a fifth of its value, while solar company Sunrun dipped by almost 30 percent.
“Stock prices fell because the market expects less policy support for clean energy,” says Derrick Flakoll, North America policy associate at Bloomberg New Energy Finance (BNEF).
Where Biden made the energy transition a key part of his agenda, Flakoll believes that “Trump will focus more on energy security and resilience … which do not necessarily coincide with renewables”.
On December 10, he also said he would expedite federal regulatory approvals, including all environmental permits, for any individual or company proposing to invest $1bn or more. The move is widely seen as a boon for the oil and gas industry.
Biden’s green push
President Biden signed the IRA into law in August 2022. Together with provisions to lower drug prices, the bipartisan bill allocated $369bn to reduce greenhouse gas emissions. To date, it represents the largest piece of climate legislation in US federal history.
Most IRA funding has been directed at low-carbon energy projects like wind, solar and nuclear power. It also includes tax rebates for households and businesses to buy electric vehicles (EVs), heat pumps and electric stoves.
The bill successfully unleashed a boom in green energy activity, spurring nearly $450bn in private investments. In 2023, low-carbon technology spending rose by 38 percent (or $239bn) from 2022 levels.
Clean power jobs grew by 4.2 percent last year – twice the national employment rate.
According to a Carbon Brief study, the IRA was expected to slash US emissions by almost 40 percent by 2035, from 2005 levels. Trump’s re-election looks set to impact that course of change.
Green energy transition ‘already under way’
Though President-elect Trump has publicly called the IRA a “waste”, he has yet to specify which parts of it he will cut. Some analysts view that as encouraging. They also point to the growth in renewables during his first presidency.
From 2017-2020, Trump renewed Obama-era tax credits for green energy projects. Solar and wind installations grew by 32 percent and 69 percent, and EV sales more than doubled during that period.
Hirs also pointed out that a disproportionate amount of IRA funding – roughly three-quarters – has so far gone to Republican-led states.
“Now that presidential elections are over, all eyes are on the 2026 midterms,” said Hirs. “Given the IRA’s concentration in Republican districts, it may prove impossible for Trump to kill the bill.”
In August, 18 congressional Republicans asked House Speaker Mike Johnson to spare efforts to repeal the IRA. They warned that such moves could upend ongoing investments in their states.
Owing to the Republican’s slim majority in the legislature, these votes may be sufficient to save key parts of the bill.
Elsewhere, many US-based companies forged ahead with their own climate plans during the first Trump presidency. That is likely to persist, as changes to accounting systems (especially in Europe and California) now require firms to report their emissions.
Stopping Incentives
For David Brown, director of the energy transition practice at energy consultancy Wood Mackenzie, said “it is very unlikely that the IRA is repealed full-stop”.
But if all of Trump’s touted IRA modifications – like lowering tax credits and tightening requirements for clean power production – are made, Wood Mackenzie anticipates that one-third less green energy will be generated in the US over the next decade.
Indeed, Brown thinks that “there will be amendments to multiple parts of the IRA”, which would undo “the full chain of incentives that have underpinned [green energy] market growth in recent years”.
Away from the IRA, offshore wind projects are at risk from federal permitting requirements, which Trump has said he’ll deny. Meanwhile, the US’s nascent solar and battery sectors are exposed to risks from trade tariffs on China – a key supplier of parts.
Though Brown remains optimistic about the future of low-carbon technology in the US, he conceded that there is “concern” the sector will be hobbled just as it’s got going. “The focus on achieving net zero won’t be there in the second Trump term,” he said.
Giving Up On Global Influence?
The IRA was designed, in part, to help US companies compete with China in clean energy markets. Looking ahead, Trump’s climate denialism could cement Beijing’s leadership in the sector.
“China already has a head-start,” says Flakoll, the analyst at BNEF. Thanks to state support, it is home to 80 percent of the world’s solar panel supply chain and is expected to make $675bn in clean energy investments this year – roughly the same as Europe and the US combined.
Flakoll also expects Trump’s election to “expand China’s global order book”. According to Johns Hopkins University, binning the IRA will cost the US up to $50bn in lost exports and drive $80bn of green energy investments abroad.
China is well placed to fill the gap. Over the past decade, Xi Jinping’s Belt and Road Initiative has deployed more than $1 trillion in modern infrastructure investment in exchange for natural resources and business access, particularly in the developing world.
Trump takes a more isolationist approach, says Flakoll. As much as possible, “he wants to onshore supply chains”. Flakoll also thinks that Trump will “retreat from global climate finance and diplomacy”.
The president-elect is planning to re-withdraw from the UN Paris Agreement. He may even pull out of the United Nations Framework Convention on Climate Change (UNFCCC).
Compared with the US, “China has a more certain and comprehensive set of climate policies”, says Flakoll. On top of losing billions of dollars in green energy exports, Trump is at risk of forfeiting geopolitical influence to China if he renounces the fight against climate change.
Experts Weigh In
Donald Trump’s return to the presidency has sparked concerns about the future of clean energy in the United States. A known climate skeptic, Trump has pledged to bolster the fossil fuel sector and terminate offshore wind projects on his first day in office. However, with renewable energy now holding strong support and a solid market presence, many experts believe his efforts to revive oil and gas may face significant challenges.
Trump’s approach to climate change could have a far-reaching impact, especially compared to his actions during his first term. In 2017, he famously announced the US’s withdrawal from the Paris Climate Agreement, which unified nearly all nations to combat greenhouse gas emissions. While procedural rules delayed the US’s exit until November 2020, Trump’s new term would allow for a swift withdrawal within a year, giving him three unrestrained years to pursue his agenda without international oversight.
The Impact on Developing Nations
The US’s departure from international climate agreements could also derail efforts to mobilize funds for developing nations, which require billions in investment to achieve net-zero emissions. Under Biden, the US pushed for countries like China to contribute to these funds, a stance that might lose traction under Trump.
Domestic Policies and Fossil Fuels
Domestically, Trump is expected to double down on oil and gas exploration, expedite offshore lease sales, and weaken environmental protections. According to Dan Eberhart, CEO of Canary LLC, the administration will likely adopt a “drill baby drill” philosophy, focusing on fracking on federal lands and streamlining pipeline approvals. Meanwhile, tariffs on solar panels and electric vehicles from China could stifle the growth of sustainable energy sectors.
Renewable energy companies are already feeling the pressure. Turbine manufacturers saw their stock prices plummet amid fears of halted offshore wind projects. Yet, the long-term impact remains uncertain. The International Energy Agency reports that global investment in clean technology now outpaces fossil fuels by a factor of two, indicating the resilience of green energy markets.
Resistance from Within
Even within Trump’s own party, resistance to dismantling green energy initiatives may arise. Biden’s Inflation Reduction Act (IRA), potentially directing $1 trillion into clean energy, has significantly benefited Republican-led districts, with 85% of its funding concentrated in these areas. This economic boon may discourage lawmakers from fully supporting Trump’s proposed rollbacks.
Abandoning international climate commitments could also cede leadership to China, already a dominant player in renewable energy. Analysts warn that sidelining clean energy could drive investment abroad, further enhancing China’s influence in the sector. The Belt and Road Initiative has already established China as a leader in global infrastructure, and Trump’s policies risk amplifying this trend.
Despite the potential setbacks, many climate leaders remain optimistic. “The result from this election will be seen as a major blow to global climate action,” said Christiana Figueres, former UN climate chief. “But it cannot and will not halt the changes under way to decarbonize the economy and meet the goals of the Paris Agreement.”
In an era where renewable energy has achieved widespread acceptance and market viability, the green transition may prove too robust to derail entirely—even under a Trump administration.
The Last Bit
As Trump prepares to take office, the future of clean energy in the US hangs in the balance. While Biden’s tenure marked significant strides in renewable energy investment and policy, Trump’s return to the White House could reverse much of this progress.
However, analysts believe the green energy transition may prove difficult to derail entirely. Changes to global accounting systems and state-level initiatives ensure that many US-based companies continue advancing their climate plans regardless of federal policy.
Ultimately, the direction of America’s clean energy sector will depend on how far Trump’s administration goes in dismantling existing frameworks and whether states, private companies, and other nations can offset the federal government’s retreat from climate leadership.
