At the entrance of New York’s Hudson River, Norwegian oil and gas company Equinor is constructing the largest US port for offshore wind, which could symbolize a shift in America’s energy future. As the United States approaches one of its most closely contested presidential elections, investors and executives are analyzing campaign statements to identify which industries may benefit or suffer under the next administration. Renewable energy is emerging as the most vulnerable to election outcomes.
Sean McGarvey, president of North America’s Building Trades Unions, which works on offshore wind projects, stated that a Harris-Walz victory would be beneficial for the offshore wind sector, while a Trump-Vance victory would be detrimental. His prediction of Kamala Harris winning the election received unanimous applause at a recent conference.
Donald Trump has committed to halting offshore wind projects on his first day if re-elected and has also promised to repeal the Inflation Reduction Act (IRA), President Joe Biden’s significant climate legislation that offers tax credits to reduce renewable energy costs and accelerate decarbonization. According to the Clean Investment Monitor, almost $450 billion in private investment has been directed into the US energy sector since the IRA’s enactment. BloombergNEF consultancy estimates that a repeal of the IRA would result in a 17% decrease in new renewable capacity additions from 2025 to 2035, with offshore wind projected to decline by 35%.
A recent analysis by Goldman Sachs concluded that renewables could be the largest beneficiary under a Harris administration, and one of the biggest losers under a Trump administration, along with tariff-sensitive sectors. Offshore wind, unlike solar and onshore wind, requires federal permits and is more susceptible to changes in political office. The Biden administration has accelerated offshore wind development, setting a goal to deploy 30 GW by 2030 and approving 16 GW of commercial-scale projects, compared to none at the start of his presidency.
Molly Morris, Equinor’s US president of offshore wind, emphasized that commitment certainty is the key factor in advancing offshore wind projects. Equinor began groundwork in June on the South Brooklyn Marine Terminal, a 73-acre project intended as an assembly site for its Empire Wind 1 project, qualifying for IRA tax credits, and to support future offshore wind projects in the region.
The outcome of the upcoming election, whether Trump or Harris wins, will have significant implications for corporate America. Bloomberg Intelligence forecasts that a Trump presidency might lower capital requirements for US banks, cut subsidies in the Affordable Care Act, and reduce the liability shield for Big Tech companies. Conversely, a Harris presidency would continue Biden administration policies, which include increased scrutiny of banks, Big Tech, and pharmaceutical companies, along with ongoing IRA implementation and emissions-curbing regulations.
Sheldon Kimber, CEO of renewables developer Intersect Power, expressed clear support for Harris, having introduced her at a fundraiser earlier this year. His company aimed to start construction on nearly all its projects to protect itself from prospective changes to tax credit rules.
A comprehensive repeal of the IRA faces substantial obstacles. Although it passed Congress without Republican approval, GOP regions of the country have been primary beneficiaries, with over three-quarters of manufacturing projects announced in the first year occurring in Republican districts, as per an FT analysis. In August, 18 congressional Republicans wrote to Speaker Mike Johnson, urging him to prioritize business and market certainty when considering any repeal or reform of the IRA.
Doreen Harris, president of the New York State Energy Research and Development Authority, expressed it would be challenging to disregard the ongoing progress. While Trump cut restrictions on fossil fuel production and emission limits for power plants and vehicles, he also extended tax credits for solar and wind projects and electric vehicles, with US renewable energy deployment continuing to grow under his presidency.
According to the Energy Information Administration, wind capacity increased by 45% between 2016 and 2020, while solar capacity more than doubled. During a debate with Harris, Trump stated he is a “big fan” of solar.
Analysts indicate potential Trump policies could adversely affect the US energy transition, including tariffs on Chinese goods and modifications to the IRA’s tax credits for electric vehicles. China dominates clean energy technology production and mineral refinement.
The Biden administration has set a target to reduce emissions by 50% to 52% from 2005 levels. A May forecast from Wood Mackenzie predicts a slower energy transition under Trump, resulting in 683 million tonnes of additional carbon emissions in the energy sector and a $322 billion decrease in expected clean energy investment by 2030. Elizabeth Yeampierre, executive director of Uprose, a Brooklyn community organization supporting the Equinor project, stated concerns that businesses might shift to Europe or other regions if Trump’s policies prevail.