Trump's return to office sparks setback for wind energy sector and uncertainty for renewable policy

On Monday, January 20, 2025, President Donald Trump, returning to the White House, signed an executive order temporarily suspending offshore wind lease sales in federal waters and pausing the approval, permitting, and financing of both onshore and offshore wind projects.

Trump has openly expressed his intent to deregulate the fossil fuel industry, rolling back plant regulations implemented during the Biden administration, describing it as a national energy emergency intended to boost domestic fuel production.

This move may significantly impact the US wind energy sector, with uncertainty clouding its future under his second term. The uncertainty gets murkier as Trump vows to eliminate the federal support for clean energy and repeal the Inflation Reduction Act. By calling wind turbines "big and ugly," Trump has clearly signaled that challenging times lie ahead for the wind sector and its stakeholders. This order is not anticipated to affect current US offshore wind projects being developed by companies such as Orsted, Avangrid, Copenhagen Infrastructure Partners, and Dominion.

Under the Biden administration, the US wind energy sector was seen as a crucial element of the strategy to decarbonize the power sector and combat climate change. The US wind energy sector added about 34GW of new capacity during 2021-2024, onshore and offshore together. As per the report titled "Global Wind Energy Outlook" by The Insight Partners, the US wind energy sector was progressing under the Biden administration, thanks to the long-term clarity about the policy and renewable subsidies.

The report further estimates that the US wind sector is set to see a drastic decline to about 18 GW during the second Trump era, down from 34 GW added in the previous administration, said Ankit Mathur. This latest development paints a bleak and uncertain picture for the US wind energy sector, said Ankit Mathur, research analyst at The Insight Partners.

Mathur added: "The US currently has over 70 GW of offshore wind capacity in the pipeline, with 15.5 GW in advanced development or under construction. However, nearly 55 GW of this capacity in the early development phase faces a bleak outlook, signalling a challenging period for stakeholders."

In another blow to the US renewable energy sector, President Trump has signed an executive order to withdraw from the Paris Climate Agreement for a second time, issuing a one-year notice to the United Nations. The industry stakeholders are skeptical of the intensity these developments will unfold for the future wind capacity development.

Wind, solar, and other clean energy projects are heavily capital-dependent, leaving them especially vulnerable to periods of high borrowing costs, as seen in the current climate. Market interest rates have surged significantly since Trump's election, creating additional hurdles for securing project financing. Major wind power companies, including GE Vernova, Orsted, and Total Energies, have already signaled intentions to reassess or scale back wind energy projects, particularly in the offshore segment.

In light of these recent curtailments and the anticipation of further challenges, The Insight Partners has reduced its 2030 forecast for US wind capacity by 30% to account for the turbulent policy environment. While wind power is still expected to grow, it will likely do so at a slower pace.

Related Reports -
1. Wind Energy Market: https://www.theinsightpartners.com/reports/wind-energy-market
2. Renewable Energy Market: https://www.theinsightpartners.com/reports/renewable-energy-market
3. Offshore Wind Power Market: https://www.theinsightpartners.com/reports/offshore-wind-power-market

Contact Us:
If you have any queries about this report or if you would like further information, please contact us:
Contact Person: Ankit Mathur
E-mail: sales@theinsightpartners.com
Phone: +1-646-491-9876

The Insight Partners is a one stop industry research provider of actionable intelligence. We help our clients in getting solutions to their research requirements through our syndicated and consulting research services. We specialize in industries such as Semiconductor and Electronics, Aerospace and Defense, Automotive and Transportation, Biotechnology, Healthcare IT, Manufacturing and Construction, Medical Device, Technology, Media and Telecommunications, Chemicals and Materials.

This release was published on openPR.