Clean Energy Companies Bounce Back After Taking Hit from Trump Victory

Clean Energy Companies Bounce Back After Taking Hit from Trump Victory
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The world’s cleanest energy companies took a hit when Donald Trump won the US presidential election in November. But their market value seems to have bounced back within a month of the famously fossil fuel friendly President taking office, new data shows.

The world’s top 200 clean energy companies offered around a one percent better total return on investment compared to a market benchmark between August and November last year, before Trump’s election victory hit the companies’ collective market value, according to data from clean capitalism company Corporate Knights and NGO As You Sow. But their latest report suggests the drop may have just been a blip.

The Clean 200 index tracks the market value of the companies with the highest share of clean energy revenues worldwide. The index was created in August 2016, with two UK companies on the list — utilities giant SSE were the ninth largest company,  with tech company Dialog Semiconductor coming in at 163rd. Siemens, Toyota Motors, and Schneider Electric were the top three companies listed in the index.

Today’s updated Clean 200 progress report shows low carbon companies’ total return in January 2017 bounced back to around three percent, after the lows of November last year where it fell to around minus two percent.

The index aims to represent companies that are true leaders in clean energy by only including companies that have a market capitalisation of more than $1 billion, and make more than 10 percent of revenue from new energy sources. The index excludes utilities that get more than 50 percent of their revenue from fossil fuels, as well as excluding all oil and gas companies as defined by the Sustainability Accounting Standards Board.

That means big oil companies that make the majority of their money in dirty energy while also profiting from a clean energy arm are excluded. The sheer size of the companies means even their relatively small low carbon revenue could appear very large compared to smaller, dedicated clean energy companies, and could skew the Clean 200 index’s data.

The Clean 200 index also excludes companies that “engage in negative climate lobbying”.

A litmus test to being part of the clean energy solution is that you don’t fight to obstruct its progress”, Toby Heaps, CEO of Corporate Knights, told DeSmog UK. Many of the companies that would fall foul of that criteria make less than 10 percent of their revenue from clean energy anyway, he pointed out.

He said that while the data shows fossil fuels remain profitable, clean energy is becoming increasingly competitive in its own right.

While clean energy offers significantly more growth potential than fossil fuels in the 21st century, we should not expect it to generate the same outsize returns as fossil fuels did in the 20th century.”

The industrial powerhouses are driving this transition by providing the electrification and efficiency solutions that make up the bulk of activity, while the large oil and gas companies are betting pounds on the past and pennies on the future.”

SSE was unsurprisingly pleased with the news that it featured in the top 200 for the first time. A spokesperson told DeSmog UK:

SSE is working hard to reduce its carbon emissions, achieving a year-on-year reduction since 2010 and it has invested billions in renewable generation and the infrastructure that supports it.

SSE has been recognised as a leader for its actions and disclosure on climate change as it looks to halve the carbon intensity of the electricity it generates between 2006 and 2020.”

Main image via Pixabay CC0

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Clean Energy Companies Bounce Back After Taking Hit from Trump Victory
Mat was DeSmog's Special Projects and Investigations Editor, and Operations Director of DeSmog UK Ltd. He was DeSmog UK’s Editor from October 2017 to March 2021, having previously been an editor at Nature Climate Change and analyst at Carbon Brief.

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