Renewable energy falls as U.S. green ambitions dim

Source: By Will Wade, Bloomberg • Posted: Thursday, November 5, 2020

Shares of renewable energy companies tumbled yesterday as the U.S. presidential election remained too close to call and hopes dimmed that Democrats would take control of the Senate.

A Bloomberg Intelligence index of large solar companies plunged as much as 4.9%, the most during intraday trading since March, as Republicans appear poised to retain a slim Senate majority. The WilderHill Clean Energy Index fell as much as 5.1%.

“There was some anticipation of a Democratic sweep and the possibility of major climate reform,” Raymond James analyst Pavel Molchanov said in an interview. Even if Biden wins, without a Democratic Senate “he’ll have to rely on executive action, tinkering around the edges, rather than anything game-changing or transformative.”

  • Top U.S. residential installer Sunrun Inc. dropped as much as 8.9%.
  • First Solar Inc., the biggest U.S. panel maker, fell 11%.
  • SunPower Corp. fell 14%.
  • Clean energy giant NextEra Energy Inc., the world’s biggest producer of wind and solar electricity, slipped 4%.
  • In Europe, Vestas Wind Systems A/S, the world’s top wind-turbine producer, slumped the most in three years before paring the losses.

With votes still being counted in key battleground states, it’s unclear if the U.S. will more aggressively shift toward green energy, as Democratic candidate Joe Biden has pledged — or if President Trump will get four more years to promote fossil fuels.

While investors may be spooked by the uncertainty, it’s unlikely a second Trump term will significantly thwart the growth of wind and solar power. Demand for clean power has increased throughout the Republican’s presidency, thanks to state-level policies, corporations pushing to go green and a growing appetite for environmental, social and governance, or ESG, investments.