Brian van der Brug / Los Angeles Times via Getty Images
- BlackRock is betting there’s upside ahead for renewable and clean energy stocks.
- Energy demand will make clean energy essential for the US.
- Risks related to tariffs and policy are priced into the market, the firm said.
US clean energy might seem an early victim of policy shifts and funding cuts, but BlackRock says its still a key source of power and an area of the stock market that could rise.
Even with renewable power facing heightened scrutiny from the Trump administration, coupled with the erosion of tax benefits in the congressional reconciliation bill, two things should keep investors interested in the space.
First, energy demand isn’t ebbing, and clean energy will be needed more than ever.
“The US likely needs more of all kinds of energy to meet AI’s needs,” BlackRock wrote in a note on Tuesday. “Industry projections see US data center electricity consumption rising between 50% and 200% by 2030 — a big jump after 15 years of flat national power demand.”
In other words, Washington can’t afford to slash a leading source of electricity if the US is to maintain its artificial intelligence leadership. According to the Energy Information Administration, solar is projected to lead US power generation growth through 2026. Together with wind, solar overtook coal in the nation’s energy mix for the first time in 2024.
Second, BlackRock says industry headwinds are priced into renewable power stocks.
“Longer term, we see clean energy stocks positioned for strong growth,” BlackRock wrote. “Renewables are quick to build and valuations are attractive: the factors that contributed to their slump — like high rates and tariffs — are now priced in, we think.”
BlackRock
BlackRock also suggested that investors keep tabs on nuclear stocks, with the Trump administration’s focus on nuclear making the sector poised for growth.
“Last week, President Trump signed executive orders aimed at expediting nuclear power reactor deployment, and the most recent revisions to the House bill preserved the existing tax credits allotted to nuclear project developers,” BlackRock wrote. “But given how long it takes to build nuclear power plants, we see natural gas and renewables benefiting sooner.”
