While shares in Danish turbine-maker Vestas Wind Systems A/S fell to their lowest level in more than 1½ months, renewable energy stocks emerged largely unscathed last week after Donald Trump confirmed his decision to withdraw the United States from the Paris climate change agreement.
“Donald Trump has spoken,” Bloomberg Markets writes. “And clean energy investors yawned.”
Ultimately, “the muted response is a sign that investors expect demand for clean energy will continue to grow, in the U.S and around the world.”
The WilderHill New Energy Global Innovation Index of renewable and low-energy companies was virtually unchanged the day after Trump’s announcement, rising 0.1%. Bloomberg’s solar and wind energy indices both added as much as 0.8%.
“I don’t think there is going to be an unwillingness for renewables because they leave the Paris accord,” Vestas Chair Bert Nordberg told the news agency in an interview. “We have a huge backlog in the U.S. We’re going to build a lot there.”
“Of course it would be better if the U.S. were to stay in the Paris agreement,” added Morten Dyrholm, Vestas’ senior vice president of marketing, communications and public affairs. But “the U.S. wind industry has broad bipartisan support because it is cost-effective and provides strong returns for investors,” he added. It’s “the lowest-cost energy source in many parts of the country. It’s compatible with farming, ranching, and hunting. It uses no water. It supports more than 100,000 jobs in 50 states. And it brings billions of dollars in economic development to the communities that host the projects.”
Stocks like Canadian Solar and JinkoSolar had fallen more than 5% after Trump first tipped his likely decision on Paris last Wednesday. But the calm reaction since suggests “investors have already moved beyond their gut reactions,” Bloomberg notes, citing San Francisco-based analyst Joseph Osha of JMP Securities LLC.
“It was widely expected that he would do something like this, so the market has had a lot of time to price it in,” added analyst Deepa Venkateswaran. “But the rest of the world will continue to focus on decarbonization.”
In another looming fail for the White House occupant who so loves to call his adversaries losers, the wave of U.S. coal closures is continuing, despite Trump administration efforts to roll back regulations and emission reduction targets, The Energy Collective reports. “More than 250 coal plants have retired since 2010, and while this trend had primarily affected older and smaller coal generation, recent plant retirement announcements are trending younger and larger than ever before, evidencing a widening economic effect,” notes Hallie Kennan of Energy Innovation LLC.
“In fact, the U.S. Energy Information Administration’s Annual Energy Outlook 2017 reports nearly 90 gigawatts (GW) of coal capacity could be retired between 2017 and 2030 under business as usual.”