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White House policy might not even be the biggest issue.
If you look at the polls, the presidential election — now exactly two weeks away — is very close. If you listen to the prognosticators, Trump has a slight edge. And if you look at the markets, whether prediction markets or Wall Street, Trump’s chances are looking pretty good, with a sweep of the White House and both houses of Congress now firmly on the table.
“Politics prediction market data have tilted toward a win by former President Trump, and markets have responded in line with this development,” Morgan Stanley analyst Michael Wilson wrote in a note to clients Monday. “Such an outcome should now be taken seriously,” wrote Jefferies global head of equity strategy Christopher Wood in a separate note last week.
And seriously is exactly how the market appears to be taking it, with a range of assets now seeming to be pricing in a Trump victory. Yields on Treasury bonds are also rising, which may be because traders see fewer interest rate cuts coming in a more inflationary Trump economy fueled by tax cuts, spending, and an icing of tariffs on top. Gold and Bitcoin prices have risen in the past month as well.
But what about the clean energy economy? Trump often speaks critically of the Inflation Reduction Act, clean energy in general, and wind energy in particular. With Republicans in control of Congress, those sentiments are more likely to be be turned into policy ... of some kind.
For investors in clean energy companies, Trump's improving odds make for nervous times. In the initial days after a Trump victory, as the reality solidifies, you’ll likely see some big price swings. Eight years ago, on Wednesday, November 9, 2016, an exchange traded fund that tracks around 100 clean energy stock called iShares Global Clean Energy, which is used as a benchmark for the industry as a whole, fell almost 5%, even as stocks overall jumped. In 2020, the fund rose more than 6.5% percent between close on election day and the following Monday, after networks had called the race for Joe Biden.
“I think stocks will trade on sentiment” following a win in either direction, Maheep Mandloi, an analyst at Mizuho, told me. “We’ll probably see that knee-jerk reaction.”
The iShares fund has been falling recently, dropping from $14.77 on September 27, when Kamala Harris peaked at 58.1% in Nate Silver’s polling models, to 47% on Monday, when Trump’s probability to win reached 52.7%.
“Renewables underperformed last week,” Mandloi wrote in a note to clients on Tuesday, with the iShares ETF down compared to the S&P 500 index. That sluggishness mostly came from solar stocks, particularly residential companies like Sunnova, Sunrun, Enphase, and Solaredge — “likely due to election, concerns” Mandloi added.
The fall has been even more dramatic for companies more exposed to Trump’s particular (dis)taste in energy, namely wind. U.S.-traded shares in Vestas, the Danish wind turbine manufacturer, have fallen over 16% since Harris peaked in the forecasts last month through Monday.
But a number of analysts are more sanguine about the fate of the IRA and the clean energy economy it has fostered. For one, the politics of repeal might not hold up in a Trumpified Washington. In August, 18 House Republicans in competitive districts wrote a letter to House Speaker Mike Johnson asking him not to target the clean energy tax credits at the core of the law. These same House Republicans have supported Johnson’s speakership where he’s taken flack from the body’s most conservative members, so this is hardly a constituency he can afford to ignore.
Even if a reconciliation bill passed next year were to scrap some or all of the IRA’s clean energy tax credits, the Internal Revenue Service could — as it has in the past when tax credits were about to expire — write rules that allow projects to claim the credits for years to come, Mandloi told me.
In any case, people in the tax credit market don’t seem to think the IRA tax credits are particularly at risk. “Political uncertainty has slowed the development of some industries,” analysts at LevelTen, a clean energy financial infrastructure company, wrote in a report last week. “It it hasn’t stopped the tax credit market from growing.” They assigned a low likelihood to a complete gutting of the IRA, noting that “there is bipartisan support for the investments catalyzed by the IRA across the nation.”
While it's possible that the bipartisan enthusiasm for investments stemming from the Inflation Reduction Act could protect much of the bill, the parts of the bill that directly support manufacturers may be the safest, namely the advanced manufacturing tax credit that has been especially popular in the solar industry.
These credits have been complemented by aggressive trade policy as well. Some of Trump’s earliest tariffs were on solar panels, and the Biden administration has also tried to protect the domestic solar manufacturing industry from “overproduction” in China and Southeast Asia. First Solar has thrown itself into domestic manufacturing with the wind of the Inflation Reduction Act’s manufacturing tax credits at its back. Bonuses for solar developers whose systems are made up of “domestic content” have helped, as well.
Morningstar analyst Brett Castelli wrote to investors a note last month acknowledging the risk to solar stocks from a change in White House party control. First Solar specifically, however, “would likely benefit from proposed trade policies, such as higher tariffs, under a Republican administration.”
The company’s stock is up 14% so far this year through Monday, although it has dipped as Harris has dipped in election forecast. The Invesco Solar ETF, which tracks the broad solar industry, is down 13% on the year.
“First Solar is unique in our view in the fact that it is relatively indifferent regardless of outcome,” Castelli told me this week. It’s helped by sheer size. “They have the largest U.S. presence for manufacturing solar panels here, domestically,” he said. “The biggest competitive threat to those factories would be cheap imports from China or Southeast Asia.”
But while the renewable energy industry is always at the risk of public policy shifts, for good and for ill, there’s another, harder to predict and harder to tame factor: interest rates.
Despite the spigot from Washington due to the IRA, many renewables companies have not been doing great in the stock market in recent years, and high interest rates are likely the reason why.
For renewables, most of the cost comes from simply building the thing. The “fuel,” whether it be photons or wind, is free. This means that renewables projects are highly sensitive to the price of the borrowed money they need for construction. While the Federal Reserve has finally begun to cut rates and anticipates continuing doing so through the end of next year, it’s by no means something it’s mandated to do, especially if there's a major change in fiscal policy going forward.
Predicting the path of interest rates is something people get paid far, far more than journalists’ salaries to do, and they’re often wrong. That being said, it’s not hard to see a world where a sizable Trump win keeps rates elevated.
As president, he showed zero appetite for fiscal restraint, and going into round two has indicated a desire for sizable tax cuts and almost nothing specific for any large scale cuts in spending, policy preferences that may be more likely to be indulged in a Washington under unified Republican control. “Interest Rates Will Be Higher in the Future, Especially if Trump Is President,” the Wall Street Journal declared earlier this month.
The “downside scenario” for stocks envisioned by Jonathan Golub, chief U.S. equity strategist at UBS investment bank, largely follows this scenario. “A combination of fiscal and monetary stimulus causes a reacceleration in inflation, forcing the Fed to abandon their rate cut plans,” he wrote to clients earlier this month. Clean energy could be hardest hit, no matter what happens to the IRA.
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And it only gets worse from here.
Hot and humid weather stretching from Maine to Missouri is causing havoc for grid operators: blackouts, brownouts, emergency authorizations to exceed environmental restrictions, and high prices.
But in terms of what is on the grid and what is demanded of it, this may be the easiest summer for a long time.
That’s because demands on the grid are growing at the same time the resources powering it are changing. Between broad-based electrification, manufacturing additions, and especially data center construction, electricity load growth is forecast to grow several percent a year through at least the end of the decade. At the same time, aging plants reliant on oil, gas, and coal are being retired (although planned retirements are slowing down), while new resources, largely solar and batteries, are often stuck in long interconnection queues — and, when they do come online, offer unique challenges to grid operators when demand is high.
For the previous 20 years, load growth has been relatively steady, Abe Silverman, a research scholar at Johns Hopkins, explained to me. “What’s different is that load is trending up,” he said. “When you’re buying and making arrangements for the summer, you have to aim a bit higher.”
Nowhere is the combined and uneven development of the grid’s supply and demand more evident than in PJM Interconnection, the country’s largest electricity market, spanning from Washington, D.C. to Chicago. The grid now has to serve new load in Virginia’s “data center alley,” while aggressive public policy promoting renewables in states such as Maryland and New Jersey has made planning more complicated thanks to the different energy generation and economic profiles of wind, solar, and batteries compared to gas and coal.
PJM hit peak load on Monday of just over 161,000 megawatts, within kissing distance of its all-time record of 165,500 megawatts and far north of last year’s high demand of 152,700, with load hitting at least 158,000 megawatts on Tuesday. Forecast high load this year was around 154,000 megawatts. Earlier this spring, PJM warned that for the first time, “available generation capacity may fall short of required reserves in an extreme planning scenario that would result in an all-time PJM peak load of more than 166,000 megawatts.”
While that extreme demand has not been seen on the grid during this present heat wave, we’re still early in the year. Typically, PJM’s demand peaks in July or even August; according to the consulting firm ICF, the last June peak was in 2014, while demand last year peaked in July. On Monday, real time prices got just over $3,000 a megawatt, and reached just over $1,800 on Tuesday.
“This is a big test. A lot of capacity has retired since 2006 and the resource mix has changed some,” Connor Waldoch, head of strategy at GridStatus, told me. While exact data on the resource mix over the past 20 years isn’t available, Waldoch said that many of the fossil fuel plants on the grid — including those that help set the price of electricity — are quite old.
PJM’s operators have issued a “maximum generation alert” that will extend to Wednesday, warning generators and transmission owners to defer or cancel maintenance so that “units stay online and continue to produce energy that is needed.”
PJM also issued a load management alert, a warning that PJM may call upon some 8,000 megawatts of electricity users who have been paid in advance to reduce demand when the grid calls for it. Already, some large users of electricity in Virginia have reduced their power demand as part of the program. There are historically around one or two uses of demand response per year in each of the electricity market’s 21 zones.
“Demand response is a real hero,” Silverman said.
Elsewhere in the hot zone, thousands of customers of the New York Independent Systems Operator lost or saw reduced power on Monday, along with over 100,000 customers affected by voltage reductions. On Tuesday, NYISO issued an “energy watch” meaning that “operating reserves are expected to be lower than normal,” and asking customers to reduce their power consumption.
Further north, oil and coal made up 10% of the fuel mix in ISO New England by Monday night, according to GridStatus data. The region has greatly expanded behind-the-meter solar generation since 2010, which as of 2 p.m. Monday was generating over 21% of the region’s power. But the grid as a whole hasn’t been able to keep up, thanks to a nationally anomalous shortage of gas capacity and still-insufficient battery storage. As the sun faded, so too did New England’s renewable generation.
“You don’t see coal very often in the New England fuel mix,” Waldoch told me. In fact, there is only one remaining coal plant in New England, which can typically power around 440,000 homes — though that’s based on normal electricity usage. On days like the past few, it may power far fewer.
Moving into Tuesday, Secretary of Energy Chris Wright invoked emergency authorities to allow Duke Energy in the Carolinas to run certain of its units “at their maximum generation output levels due to ongoing extreme weather conditions and to preserve the reliability of bulk electric power system.”
The strained grid and high prices come as grid operators question how effectively their current and planned generation capacity can meet future demand. These questions have become especially pressing in PJM, which last year shelled out billions of dollars in payments to largely fossil fuel generators in what’s known as a capacity auction. That’s already translating to higher costs for consumers — in some cases as high as 20%. But even that could be nothing compared to what’s coming.
“If you take the current conditions that PJM is dealing with right now and you add tens of gigawatts of data to center demand, they would be in trouble,” Pieter Mul, an energy and infrastructure advisor at PA Consulting, told me.
Right now, Mul said, PJM can muddle through. “It is all hands on deck. Our prices are quite high. They’ve invoked some various emergency conditions.” But that’s before all those data centers are even online. “It’s a 2026, ’27, and beyond question,” Mul said.
Today, however, “it’s mostly just very hot weather.”
The state’s senior senator, Thom Tillis, has been vocal about the need to maintain clean energy tax credits.
The majority of voters in North Carolina want Congress to leave the Inflation Reduction Act well enough alone, a new poll from Data for Progress finds.
The survey, which asked North Carolina voters specifically about the clean energy and climate provisions in the bill, presented respondents with a choice between two statements: “The IRA should be repealed by Congress” and “The IRA should be kept in place by Congress.” (“Don’t know” was also an option.)
The responses from voters broke down predictably along party lines, with 71% of Democrats preferring to keep the IRA in place compared to just 31% of Republicans, with half of independent voters in favor of keeping the climate law. Overall, half of North Carolina voters surveyed wanted the IRA to stick around, compared to 37% who’d rather see it go — a significant spread for a state that, prior to the passage of the climate law, was home to little in the way of clean energy development.
But North Carolina now has a lot to lose with the potential repeal of the Inflation Reduction Act, as my colleague Emily Pontecorvo has pointed out. The IRA brought more than 17,000 jobs to the state, per Climate Power, along with $20 billion in investment spread out over 34 clean energy projects. Electric vehicle and charging manufacturers in particular have flocked to the state, with Toyota investing $13.9 billion in its Liberty EV battery manufacturing facility, which opened this past April.
North Carolina Senator Thom Tillis was one of the four co-authors of a letter sent to Majority Leader John Thune in April advocating for the preservation of the law. Together, they wrote that gutting the IRA’s tax credits “would create uncertainty, jeopardizing capital allocation, long-term project planning, and job creation in the energy sector and across our broader economy.” It seems that the majority of North Carolina voters are aligned with their senator — which is lucky for him, as he’s up for reelection in 2026.
The new Nissan Leaf is joining a whole crop of new electric cars in the $30,000 range.
Here is an odd sentence to write in the year 2025: One of the most interesting electric vehicles on the horizon is the Nissan Leaf.
The Japanese automaker last week revealed new images and specs of the redesign it had teased a few months ago. The new Leaf, which will arrive in 2026, is a small crossover that’s sleeker than, say, a Tesla Model Y, but more spacious than the previous hatchback versions of the car. Nissan promises it will have a max range above 300 miles, while industry experts expect the company to target a starting price not too far above $30,000.
The updated Leaf won’t be one of those EVs that smokes a gas-powered sports car in a drag race, not with the 214 horsepower from that debut version and certainly not with the 174 horsepower from the cheaper version that will arrive later on. Its 150-kilowatt max charging speed lags far behind the blazing fast 350-kilowatt charging capability Hyundai is building into its Ioniq electric vehicles. But because it lacks some of these refinements, the new Nissan may arrive as one of the most compelling of the “affordable” EVs that are, finally, coming to drivers.
Not bad for a car that had become an electric afterthought.
The original Nissan Leaf was a revelation merely for its existence. Never mind that it was a lumpy potato derived from the uninspired Nissan Versa — here was the first mass-market electric car, heralding the age of the EV and welcomed with plenty of “car of the year” laurels at the dawn of the 2010s. Its luster would not last, however, as the arrival of the Tesla Model S a couple of years later stole the world’s attention. The second-generation Leaf that arrived in 2017 was an aesthetic and technological leap forward from its predecessor, with a range that topped 200 miles in its most advanced form. It was, for the time, a pretty good EV. Almost immediately, it was overshadowed by the introduction of Tesla’s Model 3 and Model Y, which catapulted Elon Musk’s company into complete dominance of the global EV market.
It took nearly a decade for Nissan (which fell into corporate mismanagement and outright crisis in the meantime) to update the stale and outdated Leaf. As a result, you might think the new version of the OG EV will arrive just in time to be outshone again. Yet the peculiar nature of the evolving electric car market has created an opportunity for the Leaf to finally grow and thrive.
There was a time when the mythical affordable Tesla could have taken the brand into the entry-level car market, and perhaps below the magic starting price of $30,000. But that has turned out to be a distraction dangled in front of fanboys and investors. In reality, Musk effectively killed the idea as he instead rolled out the Cybertruck and pivoted the company toward the dream of total vehicle autonomy.
Thanks to Tesla’s refusal to act like a normal car company, the affordable EV market is still there for the taking. Some are already in the game: Hyundai’s little Kona Electric starts at $33,000, and I’ve lauded Chevrolet for building a base version of the Equinox EV that starts around $35,000. In the next year or so, an influx of EVs in the $30,000 to $35,000 range might really change the game for electric-curious buyers.
The new Leaf is suddenly a big part of that mix. No, it won’t compete on price with a comparable combustion Nissan like the Kicks crossover that starts in the low $20,000s (not without the $7,500 tax credit, which would have made the new crop of affordable EVs directly cost-competitive with entry-level gas cars). The Leaf is likely to start just above $30,000, with the price creeping higher for buyers who opt for better performance or more range (and as I’ve noted numerous times, you ought to buy all the range you can afford if an EV is going to be your main car).
Arriving next year to compete with the Leaf is the new Chevy Bolt, another revival of an early EV icon. Experts expect a similar price range there. The anticipated Kia EV3 should come to America eventually with a starting cost around $35,000. The Jeff Bezos-backed Slate electric truck shocked the world with its promise of a bare-bones EV in the $20,000s — but, by the time the average buyer adds enough amenities to make it liveable, most Slate trucks will probably top $30,000.
Elon Musk may have abdicated his role as the Leaf’s antagonist via his refusal to build an affordable car, but erstwhile ally Donald Trump is poised to assume the role. Since the Leaf is slated to be built in Japan, the EV would be subject to whatever tariffs might be in place by the time it goes on sale next year. A 25% tariff, plus the federal government’s flip to punishing EVs with penalties instead of rewarding them with incentives, would kill the car’s value proposition in the U.S. Perhaps, then, it will become the next great affordable EV — for everybody else.