On 20th January 2025, Donald Trump took the oath of office as the 47th President of the United States. The following day, on 21st January, Trump made key statements and issued executive orders that are reshaping U.S. energy policy, with significant implications for both domestic and global energy markets.
During his first term, there was a noticeable shift toward policies favouring fossil fuels. If this trend continues into his second term, India’s green energy transition could encounter substantial challenges.
Increase Energy Production
Under the National Emergencies Act, Trump declared a national emergency due to insufficient domestic energy infrastructure and supply, including oil exploration, production, and petroleum refining. This declaration activated emergency agency powers to accelerate energy generation efforts.
Additionally, he directed agency leaders to immediately review policies that may hinder energy development and submit their reports to the U.S. Attorney General.
Expand Drilling and Natural Gas Exports
Trump signed an order to revoke Biden’s ban on oil and gas drilling in most U.S. coastal waters. However, it remains uncertain whether he has the legal authority to enforce this, and the order is expected to face legal challenges.
Additionally, Trump issued an order aimed at boosting natural resource production in Alaska. The order focuses on the development of liquefied natural gas (LNG) projects and instructs the federal government to fast-track permitting and leasing for energy developments in the region.
The president also reversed the Biden administration’s suspension of new LNG export facilities, directing the Energy Secretary to start the review of new LNG projects.
Reversing Clean Energy Incentives
Trump directed all federal agencies to immediately suspend the allocation of funds under the Inflation Reduction Act, the climate law enacted during the Biden administration that financially supports clean energy initiatives.
Specifically, he ordered a halt to funding for electric vehicle (EV) charging stations and instructed his administration to explore the possibility of ending subsidies and policies that benefit EVs.
In a separate executive order, Trump targeted wind energy, temporarily halting the approval of new or renewed leases for both offshore and onshore wind projects. He also paused leasing for wind power projects in the outer continental shelf.
Also read….
Impact on Energy Stocks in India
During the morning trading session on Wednesday, India’s green energy stocks, including Waaree Energies, Websol Energy System, Tata Power Company, and Suzlon Energy, experienced declines of nearly 8%, 5%, 3%, and 4%, respectively.
With the U.S. prioritizing fossil fuels, there could be a shift in investment away from renewable energy projects. Indian companies that depend on international markets for growth may face difficulties attracting investment as global focus shifts back to traditional energy sources.
Trump’s focus on increasing domestic oil & gas production may lead to lower global energy prices, making fossil fuels more competitive compared to renewable energy sources. This could potentially reduce global investments in green technologies, including in India.
During Trump’s first term, there was increased support for the oil & gas industries, and a second term could further strengthen the U.S. push for energy independence. This may include the implementation of protectionist tariffs on solar panels and wind turbines, further impacting global green energy markets.
Conclusion
These developments could create challenges or slow down India’s renewable energy targets, potentially hindering growth for solar stocks. U.S. policies may enable American companies to dominate the global green energy market, putting Indian competitors at a disadvantage.
As India advances its green energy initiatives, these policies could hinder the progress of domestic renewable energy firms, particularly solar manufacturers and wind turbine producers that rely on affordable imports of raw materials and technology. Indian investors heavily invested in green stocks should prepare themselves for potential volatility.
Written by Shivani Singh
Disclaimer
The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Dailyraven Technologies or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.
