By Ed Ballard
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"We don't want wind and we don't want solar, because they're a blight on our country," President Trump said in July.
This wasn't empty rhetoric. Trump has withdrawn subsidies, made permitting harder, moved to cancel offshore-wind projects, even scrubbed "Renewable Energy" from the name of a federal research lab. Fossil fuels are in favor; the energy transition has been canceled.
Despite all that, this will probably go down as the first good year for green stocks in a half-decade.
The WilderHill Clean Energy Index, for example, is up 53%, far outpacing the broader market. The index tracks stocks ranging from materials suppliers like lithium miner Albemarle (up 58%) to technology companies such as solar manufacturer T1 Energy (up 99%).
This outperformance follows a lamentable run. A clean-energy bubble burst as former President Joe Biden was taking office; including this year's gains, that index is down 70% over five years. Now, investors are edging back, drawn by beaten-down stock valuations and market tailwinds.
Rising electricity demand, particularly from artificial intelligence, is boosting providers of power and equipment to generate it. This was unfolding before Trump's return, but the demand forecasts got wilder as data-center construction accelerated.
OpenAI chief executive Sam Altman has said he craves 250 gigawatts of computing power -- roughly half of India's generating capacity.
"The amounts are just so incredibly large that even if you halved some of these forecasts, it still puts the U.S. and Europe in a significant deficit for power," said Ulrik Fugmann, co-head of environmental strategies at BNP Paribas Asset Management. The BNP Paribas Clean Energy Solutions fund he co-manages had a gross return of 46% through November, after four years of declines.
For those who need power fast, carbon-dioxide emissions are secondary. Fugmann's top holding, Siemens Energy, is up 133%, more because of the natural-gas turbines it sells than its wind turbines.
But gas turbines are sold out for years. If you're in a hurry, renewables and batteries are available. Shares in Vestas Wind Systems, which only makes wind turbines, are up over 60%.
"Renewables are the main option for new capacity in the next three to five years," analysts at HSBC wrote this week.
For investors like Fugmann, the policy backlash could have been worse, and key uncertainties are now resolved.
There are other tailwinds. Batteries keep getting cheaper. Lower interest rates help debt-dependent project developers. Brookfield Renewable Partners, for instance, is up 16%. Offshore-wind projects that the administration sought to cancel are forging ahead after favorable court rulings.
Meanwhile, this year's carnage could end up meaning more pricing power for the survivors.
A host of solar companies recently wrote to Congress complaining about "a nearly complete moratorium" on federal permitting. Developers are racing to beat subsidy deadlines and secure equipment before new curbs on Chinese products kick in.
The upshot is that analysts have reduced their forecasts for how much energy-generating capacity will be installed in the U.S. in the coming years. That should push prices up. Prices for wind-energy power-purchase agreements rose 14% year-over-year in the third quarter, according to LevelTen Energy.
Hostile policies hold the promise of a seller's market.
See you in 2026: This will be the last edition of the newsletter for 2025 -- thanks for reading, and happy holidays. As always, send your feedback and suggestions to ed.ballard@wsj.com. And if somebody forwarded you this email, you can subscribe here.
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This Week's Top Stories
More EV mayhem. Ford expects to take $19.5 billion in charges, mainly tied to its electric-vehicle business, as demand sinks. Ford's Kentucky battery plant will now cater to utilities and data centers, and other battery suppliers' shares fell. Meanwhile, the European Union plans to water down rules that would have effectively banned the sale of new combustion-engine cars from 2035.
Trump's media company is merging with a fusion-energy venture. Trump Media & Technology agreed to merge with Alphabet-backed TAE Technologies. TAE said the $6 billion combination will unlock capital to build giant power plants for the AI boom.
Replacing coal with pine trees. Weyerhaeuser, America's largest private landowner, launched a venture to turn runty trees and sawdust from its mills into a replacement for metallurgical coal used in steel making.
Whatever happened to the climate crisis? It clashed with the affordability crisis, and affordability won, WSJ chief economics commentator Greg Ip writes, rounding up examples of politicians and executives who've gone quiet on climate.
-- Electricity Auction Highlights Soaring Prices, Reliability Worries
(Barron's)
-- Heart Attacks, Lung Conditions Jumped After Los Angeles Wildfires (WSJ)
-- Energy Department Orders Washington Coal-Fired Plant to Keep Firing (WSJ)
-- BP Turns to Former Exxon Veteran as Next CEO (WSJ)
Quoted
Podcast
The Data Point
Regulatory U-turns on tailpipe emissions and EV subsidies make it all but impossible for U.S. automakers to not lean into selling gas guzzlers, WSJ's Jinjoo Lee writes. But it will be tough for them to boost their profits today without falling farther behind in EVs, where the Detroit 3 collectively have less than 5% of the global market.
About Us
WSJ Climate & Energy offers news, analysis and exclusive data focused on the intersection of business, money and climate. You'll find highlights from across Dow Jones, including The Wall Street Journal, Barron's, MarketWatch and Investor's Business Daily, plus data and analysis from OPIS, Chemical Market Analytics and McCloskey.
Today's email was written by Ed Ballard in London. Contact him at ed.ballard@wsj.com. Contact the team at climate@wsj.com.
(END) Dow Jones Newswires
December 18, 2025 09:25 ET (14:25 GMT)
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