The energy transition proceeds apace in the wider world and the reduction in the price of assets and products creates a golden opportunity for both investors and consumers.ARIS MESSINIS/AFP/Getty Images
John Rapley is a contributing columnist for The Globe and Mail. He is an author and academic whose books include Why Empires Fall and Twilight of the Money Gods.
“This is a full-on legislative assault on wind and solar,” said one energy analyst of Donald Trump’s “Big Beautiful Bill.” Since the U.S. President returned to the White House, the assault on everything ESG has gone full bore.
Companies are abandoning their climate pledges, cancelling investment plans and knocking down the share prices of companies in the renewable-energy sector, pushing the global index of clean-energy companies down to its lowest level in five years. Meanwhile, here in Canada. Prime Minister Mark Carney appears to have abandoned his concern about climate change and fallen in with the oil and gas industry.
All of which makes this a good time to buy green. When you live so close to Washington it can feel like it sets the world’s agenda, but on the energy transition, it doesn’t. All Mr. Trump’s anti-renewable backlash is doing is handicapping the United States in a race with China. In the wider world, the energy transition proceeds apace, and the reduction in the price of assets and products, thanks to Mr. Trump’s Luddism, creates a golden opportunity for both investors and consumers.
If you ignore the noise and look at the activity, you see that the green train keeps rolling. Largely overlooked in the reporting of Germany’s huge expansion in defence and infrastructure spending was that in return for its support, the Green Party secured a ring-fenced commitment that €100-billion ($160-billion) would go into renewable-energy investments. This is less idealism than good economics. One of Europe’s best-performing economies has been Spain, and a key reason for that has been that it has much cheaper energy. Why? Because unlike Germany, whose energy costs soared when Russian gas supply was cut off, Spain produces most of its electricity with renewables, and is looking to further expand the sector.
You see the same thing across much of the developing world, and especially in Asia. The availability of cheap Chinese solar panels is leading countries to aggressively adopt renewable energy even without government guidance. By localizing energy supply, businesses and consumers can free themselves from the vagaries of global energy markets they can’t control, providing themselves with endless cheap power.
Carney tells energy leaders how infrastructure projects in national interest will be assessed
The same goes for transportation technology. You wouldn’t know it if you look at American or, for that matter, Canadian roads, but electric vehicles are sweeping the world. The Chinese manufacturer BYD has invented a supercharger that fills a battery in five minutes, about the time it takes to gas up a car. Meanwhile, a South African company is pioneering a network of recharging stations powered entirely by solar microgrids, which will enable the country to eliminate fuel imports and travel on endless cheap energy. Following a brief fall in EV sales in 2024 that led some analysts to say their popularity had peaked, sales leapt back up this year, reflecting the obvious advantages of this new technology.
In fact, the principal effect of Mr. Trump’s policy will be to handicap American producers in the race to keep up with new entrants in both this fast-growing sector, and possibly put the country behind China in artificial intelligence as well. AI demands enormous amounts of energy, and the cheapest energy is now renewable, which is why renewable-energy installation is outpacing carbon-intensive energy even in the U.S.
The U.S. government expects natural-gas-fired electricity production to fall 3 per cent this year, but solar generation to increase by 34 per cent. Even in Republican-run Texas, efforts to reverse the renewable-energy push have failed, because it is providing lowest-cost power. Mr. Trump’s bill will now further raise U.S. energy costs.
Mr. Trump’s national self-harming policies create a window of opportunity for Canada. Even if it’s too late to compete with China in the production of solar panels or EVs, there will be countless opportunities in this fast-growing sector, including such things as grid management, storage and the integration of AI. Most of the jobs created in the renewable-energy sector are not in manufacturing but in services further up the supply chain, such as installation, deployment and maintenance.
Moreover, there will be lots of dynamic American startups looking for new homes, which Canada should welcome with open arms. Add to this the potential growth in green finance, where recent research has revealed that countries with stricter environmental controls are those with the most developed green bond markets, and the possibilities multiply yet further.
And that renewable index Mr. Trump managed to knock for the eight-count? After plunging when he took office, it’s risen nearly 20 per cent. Meanwhile the index for oil and gas companies he’s so determined to bring roaring back to life has fallen nearly 10 per cent. Investors see what Donald Trump refuses to: No matter how loudly he screams “drill, baby, drill,” the world will just move on without him.