With or without Trump, renewable energy, coal-to-gas switching, and carbon reductions should continue.
Anti-environment rhetoric might be trending now, but even our most conservative forecasts for the next eight years show U.S. renewable energy capacity doubling, gas continuing to steal power generation market share from coal, and carbon emissions falling near Obama administration-era targets.
The three key trends we forecast during the next four to eight years are:
1 State renewable portfolio standards will keep U.S. renewable energy growth in line with that achieved during the Obama presidency. Supportive tax policy, pro-manufacturing initiatives, and corporations’ interest in reducing their carbon footprint represent upside to our base forecast.
2 Efficiency improvements in gas generation technology have made it difficult for aging coal generators to compete, especially in the eastern United States, where cheap gas is plentiful.
3 Carbon emissions reductions will remain on track to meet or exceed targets in the U.S. Clean Power Plan and the Paris Agreement despite President Donald Trump’s efforts to abandon both.
Best positioned to take advantage of our forecasts are large-cap utilities with good regulatory relationships and investment opportunities. On average, we expect the six utilities we feature to increase earnings and dividends 6% annually at least through the next election cycle.
Best Idea Dominion Energy
Forecast 1: Renewable Energy Goes Boom
During the past decade, U.S. tax incentives have helped drive exponential growth in renewable energy. In the coming years, our analysis shows state renewable portfolio standards, or RPS, mandates will supercharge U.S. renewable energy growth.