A $30 Billion Meltdown in Clean Energy Puts Biden’s Climate Goals at Risk

(Bloomberg Businessweek) -- No one expected the transition from fossil fuels to be easy. But a year after President Joe Biden’s landmark climate law promised billions of dollars for America’s switch to clean energy, some of the nation’s most ambitious renewable power projects have been shelved, electric car sales are missing targets and investors are fleeing the sector in droves.

The result is a $30 billion collapse in US clean energy stocks in the last six months—a market many investors expected to flourish in the aftermath of the law’s passage.

Few industries have been unscathed by soaring interest rates, but perhaps none has been harder hit than renewable energy. For a sector that builds big, expensive facilities such as solar plants and wind farms, high rates cut profit margins enough to sink projects and bankrupt companies. The giddy enthusiasm that followed the Inflation Reduction Act’s passage evaporated, wiping out a quarter of the market value of US companies in the S&P Global Clean Energy Index in the six months ended Nov. 27.

It’s a meltdown that underscores the obstacles standing in the way of Biden’s ambitious climate goals.

Along with sky-high financing costs, clean energy companies face the problems of winning over potential neighbors for their projects, securing government permits and plugging into a cre...
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