Trump won, but wind has to keep pushing forward

This is no time for mourning. This is the time to fight.

Early on Wednesday morning, Donald Trump won the race to become the US president-in-waiting after a divisive campaign in which insults flowed more readily than detailed policy statements. The world is now waiting to find out which policies the brash billionaire will pursue – and, for those in the wind sector, it does not look good.

When it comes to climate change, Trump has bad form. He has previously called it a “hoax” perpetuated by China to make the US uncompetitive, and has vowed to scrap the United Nations deal on climate change that was agreed in Paris last December.

On that front, the international community has engaged in a bit of diplomatic trolling. The deal became international law last Friday, perhaps in anticipation of a potential Trump victory, and this commits countries to cut their carbon emissions and increase their investment in renewables including wind. The fact that the deal has become international law means Trump now has to wait four years to exit it.

But that does not mean Trump cannot exercise power. For instance, if he reiterates his plan to exit the deal then it gives other countries an excuse to slow their own transition to a low-carbon economy. They will say: ‘Well, if the US isn’t doing it, why should we?’

If this happens then it would put at risk moves to increase the uptake of renewables globally, which is clearly not a good position for the wind sector to be in.

In the meantime, Trump could also wreak havoc for renewables at home by slowing the country’s own transition to lower-emission energy sources. He gave some insight into his planned energy policies in June when he announced his intention to scrap Barack Obama’s Clean Power Plan, which he could well do in the coming weeks.

And Trump has also committed to rolling out so-called “clean coal” – a classic oxymoron – and reducing support for wind farms. Trump has derided wind farms an ineffective in all ways – except for killing birds, that is. Again, this does not bode well.

But you might say: ‘Ah, but his supporters like wind.’ This is true, but only to a limited extent. The Pew Research Center reported last month that 77% of Trump supporters like wind farms and want more of them. This is lower than the 88% of Hillary Clinton supporters who want more wind farms, but it still looks like a healthy figure.

In our view, though, that one figure does not tell the whole story.

Seventy-seven percent of Trump supporters want more wind farms, but 69% want more coal mines, 66% want more offshore drilling, 58% want more fracking, and 55% want more nuclear. Trump supporters want wind farms, but that is only because they want more electricity whatever source it comes from. Whether it is ‘clean’ or ‘dirty’ doesn’t seem to matter. The research also does not specify how much new wind capacity they would want, so they may only want a tiny amount.

Investors in the stock markets certainly do not see this as good news for wind. The share price of Vestas has dropped 19% since its weekly high on Monday, and others have too (see today's lead story). This shows investors are not enthused by wind’s prospects under Trump.

But it is too easy to be pessimistic. The fact is that the cost of power from wind farms in the US is now 66% lower than it was six years ago. For every year that goes by, the business case for wind farms in the US keeps getting stronger. It now competes with natural gas, and coal will struggle to compete with both of them.

This means that it is now time for wind to re-double its efforts to cut the cost of electricity from wind farms; to make breakthroughs in energy storage; and to take advantage of certainty offered by the extension of the production tax credit through to 2019.

It could take time for Trump’s energy policy to take shape, and the wind sector must take advantage of every second of that head start.

This is no time for mourning. This is the time to fight.

Early on Wednesday morning, Donald Trump won the race to become the US president-in-waiting after a divisive campaign in which insults flowed more readily than detailed policy statements. The world is now waiting to find out which policies the brash billionaire will pursue – and, for those in the wind sector, it does not look good.

When it comes to climate change, Trump has bad form. He has previously called it a “hoax” perpetuated by China to make the US uncompetitive, and has vowed to scrap the United Nations deal on climate change that was agreed in Paris last December.

On that front, the international community has engaged in a bit of diplomatic trolling. The deal became international law last Friday, perhaps in anticipation of a potential Trump victory, and this commits countries to cut their carbon emissions and increase their investment in renewables including wind. The fact that the deal has become international law means Trump now has to wait four years to exit it.

But that does not mean Trump cannot exercise power. For instance, if he reiterates his plan to exit the deal then it gives other countries an excuse to slow their own transition to a low-carbon economy. They will say: ‘Well, if the US isn’t doing it, why should we?’

If this happens then it would put at risk moves to increase the uptake of renewables globally, which is clearly not a good position for the wind sector to be in.

In the meantime, Trump could also wreak havoc for renewables at home by slowing the country’s own transition to lower-emission energy sources. He gave some insight into his planned energy policies in June when he announced his intention to scrap Barack Obama’s Clean Power Plan, which he could well do in the coming weeks.

And Trump has also committed to rolling out so-called “clean coal” – a classic oxymoron – and reducing support for wind farms. Trump has derided wind farms an ineffective in all ways – except for killing birds, that is. Again, this does not bode well.

But you might say: ‘Ah, but his supporters like wind.’ This is true, but only to a limited extent. The Pew Research Center reported last month that 77% of Trump supporters like wind farms and want more of them. This is lower than the 88% of Hillary Clinton supporters who want more wind farms, but it still looks like a healthy figure.

In our view, though, that one figure does not tell the whole story.

Seventy-seven percent of Trump supporters want more wind farms, but 69% want more coal mines, 66% want more offshore drilling, 58% want more fracking, and 55% want more nuclear. Trump supporters want wind farms, but that is only because they want more electricity whatever source it comes from. Whether it is ‘clean’ or ‘dirty’ doesn’t seem to matter. The research also does not specify how much new wind capacity they would want, so they may only want a tiny amount.

Investors in the stock markets certainly do not see this as good news for wind. The share price of Vestas has dropped 19% since its weekly high on Monday, and others have too (see today's lead story). This shows investors are not enthused by wind’s prospects under Trump.

But it is too easy to be pessimistic. The fact is that the cost of power from wind farms in the US is now 66% lower than it was six years ago. For every year that goes by, the business case for wind farms in the US keeps getting stronger. It now competes with natural gas, and coal will struggle to compete with both of them.

This means that it is now time for wind to re-double its efforts to cut the cost of electricity from wind farms; to make breakthroughs in energy storage; and to take advantage of certainty offered by the extension of the production tax credit through to 2019.

It could take time for Trump’s energy policy to take shape, and the wind sector must take advantage of every second of that head start.

This is no time for mourning. This is the time to fight.

Early on Wednesday morning, Donald Trump won the race to become the US president-in-waiting after a divisive campaign in which insults flowed more readily than detailed policy statements. The world is now waiting to find out which policies the brash billionaire will pursue – and, for those in the wind sector, it does not look good.

When it comes to climate change, Trump has bad form. He has previously called it a “hoax” perpetuated by China to make the US uncompetitive, and has vowed to scrap the United Nations deal on climate change that was agreed in Paris last December.

On that front, the international community has engaged in a bit of diplomatic trolling. The deal became international law last Friday, perhaps in anticipation of a potential Trump victory, and this commits countries to cut their carbon emissions and increase their investment in renewables including wind. The fact that the deal has become international law means Trump now has to wait four years to exit it.

But that does not mean Trump cannot exercise power. For instance, if he reiterates his plan to exit the deal then it gives other countries an excuse to slow their own transition to a low-carbon economy. They will say: ‘Well, if the US isn’t doing it, why should we?’

If this happens then it would put at risk moves to increase the uptake of renewables globally, which is clearly not a good position for the wind sector to be in.

In the meantime, Trump could also wreak havoc for renewables at home by slowing the country’s own transition to lower-emission energy sources. He gave some insight into his planned energy policies in June when he announced his intention to scrap Barack Obama’s Clean Power Plan, which he could well do in the coming weeks.

And Trump has also committed to rolling out so-called “clean coal” – a classic oxymoron – and reducing support for wind farms. Trump has derided wind farms an ineffective in all ways – except for killing birds, that is. Again, this does not bode well.

But you might say: ‘Ah, but his supporters like wind.’ This is true, but only to a limited extent. The Pew Research Center reported last month that 77% of Trump supporters like wind farms and want more of them. This is lower than the 88% of Hillary Clinton supporters who want more wind farms, but it still looks like a healthy figure.

In our view, though, that one figure does not tell the whole story.

Seventy-seven percent of Trump supporters want more wind farms, but 69% want more coal mines, 66% want more offshore drilling, 58% want more fracking, and 55% want more nuclear. Trump supporters want wind farms, but that is only because they want more electricity whatever source it comes from. Whether it is ‘clean’ or ‘dirty’ doesn’t seem to matter. The research also does not specify how much new wind capacity they would want, so they may only want a tiny amount.

Investors in the stock markets certainly do not see this as good news for wind. The share price of Vestas has dropped 19% since its weekly high on Monday, and others have too (see today's lead story). This shows investors are not enthused by wind’s prospects under Trump.

But it is too easy to be pessimistic. The fact is that the cost of power from wind farms in the US is now 66% lower than it was six years ago. For every year that goes by, the business case for wind farms in the US keeps getting stronger. It now competes with natural gas, and coal will struggle to compete with both of them.

This means that it is now time for wind to re-double its efforts to cut the cost of electricity from wind farms; to make breakthroughs in energy storage; and to take advantage of certainty offered by the extension of the production tax credit through to 2019.

It could take time for Trump’s energy policy to take shape, and the wind sector must take advantage of every second of that head start.