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Businesses Are Beginning to Realize That Smart Money Is in Renewable Energy

Much of the private energy sector has turned a corner, looking to profit from clean technology.

Elon Musk, the billionaire investor and inventor at the head of Tesla Motors and SpaceX, has a long track record of clickbait-friendly pronouncements. His plans for solar roofing are no different. Framing the new product in the same revolutionary terms he uses for self-driving Tesla cars or colonizing Mars, Musk promises shingle-sized solar panels that cost less to manufacture than a traditional roof and reduce energy consumption. Musk’s vision for American rooftops is interesting enough, but in hindsight, the date of his announcement is even more so: October 28, just 11 days before the United States elected a climate change denier to be its next president.

That proximity offers a stunning example of how much politics and business have grown apart when it comes to being proactive for the sake of the planet. In years past, environmental action by “business” meant energy companies like Exxon undermining international agreements like the Kyoto Protocol to protect their bottom lines. Nowadays, retrogrades like Donald Trump and climate change skeptic Myron Ebell are taking over US environmental policy only to discover that much of the private sector has turned a corner, looking to profit from the clean technology revolution instead of stymying the response to the climate crisis.

A report by the renewable energy policy network Ren21 shows that clean energy investment increased to $286 billion in 2015, with solar energy accounting for 56 percent of the total and wind power for 38 percent. Last year, more than twice as much money was spent on renewables than on coal and gas-fired power generation ($130 billion). Those investments have also bought political muscle: when leaked European Union documents revealed renewable energy would not be a top priority in the EU’s new winter package, corporations like Google, Unilever and IKEA joined forces to call for renewables to be given greater emphasis.

With fossil fuels struggling, the smart money is clearly on renewable energy. Conservatives like to push the theory thatdeliberate over regulation by President Obama caused the coal industry’s demise, but the truth is that coal has been on a downward trajectory for the past decade. With cleaner alternatives crowding out coal, banks are no longer willing to finance projects, and prices remain too low for coal companies to stay afloat. Even if he guts environmental rules, Trump’s promises to revive the industry defy the very free market logic he ascribes to.

In fact, the only way to make coal financially viable again would be significant market intervention, like tax breaks or making coal use mandatory — hardly in line with the GOP’s stance on competitive markets. Opening up federal lands to more oil, gas and coal production would only lead to more oversupply and depressed prices, burying the industry Trump is trying to boost. Making mining profitable again would also mean finding buyers outside the US, and Trump will quickly realize US coal has no one left to sell to. European demand is already waning, and China, despite its rapacious appetite, can buy more easily from nearby Australia. Canada is also a no-go: Justin Trudeau’s environment minister announced recently that Ottawa would speed up phasing out its coal plants.

With all that in mind, it should come as no surprise Trump’s threats to withdraw from COP21 have met with pushback from the boardroom. Big-name companies including eBay, Starbucks and Hilton recently co-signed a letter urging Trump not to abandon the climate deal, saying “failure to build a low-carbon economy puts American prosperity at risk,” and stressing they would be pushing on with their own low-carbon targets, regardless of whatever anti-environment policies Trump enacts. If the federal government stops backing new clean technology research, these businesses will need to become US flagbearers for renewables and sustainability.

Ironically for Trump, his own vagueness might offer him an out. Renewable energy advocates note Trump never explicitly said he would end federal tax credits for wind and solar installations, and have also pointed out it’s unlikely he would be able to muster the Congressional support for doing so. With major companies investing in wind, solar and other renewables of their own accord, clean energy has gained too much momentum for a regressive federal government to interfere.

The upshot is simple: Whether or not Trump wants to wade back into the weeds on this debate, the rest of the world has moved on. The nearly 200 governments that took part in the COP22 climate change talks in Marrakesh said that US withdrawal would merely dent, rather than derail, the agreement. That consensus includes other major fossil fuel exporters: Next year, major oil producer Kazakhstan will be hosting a major international expo dedicated not only to renewable future energy sources, but also promoting energy efficiency and the idea that access to energy constitutes a fundamental human right — a critical issue in developing Asia, home to a large proportion of the 1.2 billion people that still lack access to electricity.

Under Secretary of State Thomas Alfred Shannon confirmed the US would participate in the expo one day before Musk’s announcement of the new solar roofing tiles, with clean energy company AES offering a demonstration to boot. Events like these are critical for both the US government and the private sector, and making climate change denial official policy would cost the US not just its reputation, but also its place in the booming clean energy and sustainability markets. If Trump is even a fraction of the businessman he’s supposed to be, that should be clear to him. After all, when China has to admonish the president-elect for parroting climate conspiracy theories, it can be safely assumed that brand USA has already fallen in the rest of the world’s esteem.

For Trump, the math should be simple: He’s promising a war that can’t be won. Of course, that doesn’t mean progressives and anyone who cares about the environment can afford to sit back. If he actually tries to enact any of his fanciful election promises about reviving coal or tearing up climate deals, we need to fight him tooth and nail. The good news? This time around, most of the business world is on the right side of history.

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