Coal up, renewables down as markets weigh Trump win

As tens of thousands of words are written on what a US Trump presidency means for America’s clean energy industry, and more broadly for renewables and climate efforts around the world, the numbers of the global stock markets tell their own story.

With the knowledge that Trump is “not a great believer in anthropogenic global warming,” and seems to be equally disenchanted with renewable energy (wind turbines, Scotland, don’t even!), and has promised to revive America’s coal sector – and eviscerate the EPA – the markets have been quick to reflect where they think things are headed.

As Reuters reports, already the prospect of a shift in policy under Trump has lifted the shares of US mining equipment giant Caterpillar, as well as North American railroads and other companies tied to fossil fuels.

Glencore, the world’s top coal trader, surged more than 7 per cent on Wednesday, according to Bloomberg. And US coal giant Peabody Energy – which recently succumbed to bankruptcy and is looking to sell its assets in Australia – surged as much as 67 per cent.

Shares of other big coal miners such as Anglo American, BHP Billiton and Rio Tinto also rose between 2 per cent and 4 per cent on Wednesday, Bloomberg said.

At the same time, it has slammed the shares of renewable energy firms. Seeking Alpha reported on Thursday that the stock price of US renewables heavyweight First Solar was “hammered to a 52-week low” at below $US32 a share. (Although it also argues Trump will be a positive for US-based solar firms.) SunPower Corp and Canadian Solar also fell.

And Bloomberg reports that Vestas Wind Systems, the world’s biggest wind-turbine maker, plunged as much as 13 per cent, while fellow turbine makers Spain’s Gamesa, and Germany’s Nordex also fell.

And back in the US, shares of newly profitable electric vehicle maker Tesla Motors – which as Reuters points out benefits from federal tax breaks for electric vehicles – sank 3.4 per cent to its lowest price since February.

“The swing foretells a story of the most carbon-intensive fossil fuel making a comeback, while the fight against climate change – and investment in wind and solar power – languishes,” write Bloomberg analysts Javier Blas and Anna Hirtstein.

As they point out, Trump’s only major energy policy speech so far promised to rescind “job-destroying” environmental regulations within 100 days of taking office and cancel the climate deal reached last year in Paris.

If he delivers on these promises, they write, “he could effectively roll back eight years of US energy policy,” with consequences to industry giants like Exxon Mobil and also for oil-rich nations.

“The oil and gas industry is a clear winner with the new president,” said Alexandre Andlauer, head of oil at research firm Alphavalue in Paris. “US oil companies have a better future today than yesterday.”

On Greentech Media, Tom Konrad – who is a manager and stakeholder in the Green Global Equity Income Portfolio (GGEIP), a private fund which invests in YieldCos and other high-income green stocks – is “moving decisively into cash.”

“Other than for fossil fuel companies (which I refuse to invest in), I don’t see a Trump presidency being good for much of the economy, or the stock market,” he writes.

“As Kenny Rogers put it, you have to ‘know when to walk away, and know when to run.’ In my opinion, now is the time to walk away. I’d rather not wait until it’s time to run.

“When you have cash,” he adds, “a bear market is a buying opportunity. When you have only stocks, even the best stocks, a bear market just pain.”

But Stephanie Pfeifer, CEO of the Institutional Investors Group on Climate Change, a European forum for 128 investors with more than €13 trillion in assets, is more optimistic, descirbing the trend towards greener growth as “irreversible”.

“Renewables have already overtaken coal as a global power source, electric vehicles are the growth segment of the auto industry and jobs are being created in clean energy sectors faster than any other,” she told Reuters.

And even Vestas is reserving its judgment, for now. According to another Reuters report, the Danish company said on its Twitter feed on Thursday it would not speculate so soon after the election about the renewable energy sector during Trump’s presidency.

“Wind and renewable energy have broad bipartisan support. Polls show that almost 80 per cent of Trump supporters want more wind farms built in the United States,” it said.