European companies focused on clean energy are halting expansion plans, bracing for lower sales, or doubting funding for U.S. projects due to concerns about a potential election victory for Donald Trump, according to Reuters.
Trump has criticized President Joe Biden’s climate policies as a “green new scam” and is expected to try to undo much of Biden’s work, including the Inflation Reduction Act (IRA), which offers tax breaks and subsidies to U.S. and foreign companies investing in sustainable energy.
The IRA, passed in 2022, has been a strong incentive for European companies to expand or establish their U.S. presence.
However, the possibility of a second Trump presidency is causing them to reconsider.
“With a Donald Trump who is very opportunistic, is also very polemic and is also fairly unpredictable, you have to ask yourself whether it makes sense to make such a bet,” said Peter Roessner, CEO of Luxembourg-based hydrogen firm H2Apex, to Reuters.
Under the IRA, H2Apex could have built a hydrogen tank production plant in the United States for about a third of the $15 million in costs.
However, in February, Roessner decided to cancel the plan over concerns about a potential Trump reelection, even though the company had already held initial talks with potential customers.
Market speculation about Trump regaining the White House in November has intensified after he was shot at during an election rally and later secured the Republican Party nomination.
Recent polls show a narrowing gap between Trump and Kamala Harris, the likely Democratic candidate with similar climate views to Biden’s.
Roessner’s comments reflect the anxiety among Europe’s clean tech firms over a potential Trump presidency and their efforts to prepare for such a scenario.
Wood Mackenzie, an energy data and analytics company, estimates that a Trump presidency could put $1 trillion in projected low-carbon energy investments at risk by 2050.
Consultancy Roland Berger suggests that while a full repeal of the IRA is improbable, a Trump administration could still jeopardize incentives for electric vehicles, EV charging, solar power, and energy efficiency.
German solar firm SMA Solar issued a profit warning last month, citing a potential government change in the United States, the world’s second-largest solar market after China, as a risk factor.
The world’s largest maker of solar inverters had initially aimed to choose a location for a planned factory in the United States by the end of June but has yet to finalize one, stating it is still evaluating possible sites in several states.
