President-elect Donald Trump’s plan to repeal the 2022 Inflation Reduction Act (IRA), which provides tax credits and subsidies for renewable energy projects, has caused alarm among cleantech companies and investors in clean energy stocks. However, the industry is not entirely reliant on these subsidies for its growth. Green energy is becoming increasingly competitive in terms of cost, with wind and solar now being the cheapest electric generation options in the country. Additionally, green energy projects have been providing jobs and investment dollars to Republican-held Congressional districts, making it difficult for the IRA to be completely repealed.
Some experts believe that green energy could benefit from certain Trump policies, such as corporate tax cuts and reduced red tape for project approvals. Liberty Energy CEO Chris Wright, who is also a Trump advisor, believes that cheap and reliable energy is essential for improving the world. Despite the potential loss of subsidies, the industry is expected to continue growing due to increased demand for electricity, particularly from data centers serving artificial intelligence needs.
Alternative energy sources such as wind, solar, and batteries are already gaining traction in red states like Texas, where a significant amount of IRA benefits have been allocated. These states are projected to add more green power capacity in the coming years, driven by a surge in demand from data centers and other commercial customers. Companies like Amazon, Google, and Microsoft, which rely heavily on electricity, can afford to pay for their power needs even without government subsidies.
State and local policies, as well as private capital, will continue to support the growth of green energy. Despite the potential reduction in federal incentives, the industry is expected to thrive through innovation and increased efficiency in energy systems. Big oil companies like ExxonMobil also have a stake in climate solutions and are exploring green technologies like hydrogen production. Natural gas, while still a fossil fuel, has helped reduce carbon emissions in the U.S. by displacing coal as a primary energy source.
The green revolution has momentum and is expected to continue expanding in the coming years. Despite potential challenges posed by Trump’s policies, the industry is well-positioned to overcome them and achieve further growth. Renewable energy sources like wind and solar are becoming more competitive in terms of cost and are expected to play a significant role in the global transition to a greener energy future.
