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The Post-Election Issue: Policies, Stocks, and Voter Sentiment
Good morning and welcome to today’s GridBrief. The U.S. election has delivered a dramatic shift in Washington, with Trump back in the White House and Republicans now wielding Senate control. These results are already impacting energy markets, with renewable stocks reacting sharply and new predictions emerging for the oil, gas, and nuclear sectors. Let’s dive into what Trump’s victory means for the energy landscape, which stocks are winners and losers, and how voter sentiment on energy policy came through at the polls.
Trump’s Victory and the Energy Landscape
Trump’s comeback to the White House signals a probable shift in U.S. energy policy priorities. We can expect a roll-back of clean energy incentives, with Trump likely moving to undo provisions from Biden’s Inflation Reduction Act, which focused heavily on green subsidies. With fossil fuels back on the front burner, the administration may lift restrictions on drilling and approve pipeline projects that languished under the previous administration. The oil and gas industry is set to receive more federal support, with policies likely aimed at boosting domestic production and easing restrictions on exploration and transport.
Beyond fossil fuels, Trump’s stance on nuclear energy is cautiously optimistic. His administration is expected to advocate for nuclear as a reliable “bridge” in a grid increasingly reliant on intermittent renewable sources. Nuclear insiders view this return as a lifeline for the industry, with opportunities for regulatory reforms and increased investment in advanced reactors. Meanwhile, Trump’s known skepticism on climate change will likely steer the U.S. away from international climate commitments, reprioritizing economic gains over emissions targets. Expect an era marked by a “back to basics” approach in energy policy that sidelines net-zero ambitions for a traditional energy revival.
Energy Stocks React to the Election:
Winners and Losers
The market response to Trump’s victory was swift and divided. With the Dow Jones set to surge by over 1,200 points, fossil fuels and traditional energy sectors saw gains, while renewables took a hit. Investors are banking on reduced regulation and favorable tax conditions, leading to a rally among oil, gas, and some key tech stocks.
Here’s a quick look at the winners and losers:
Winners:
Tesla (TSLA): +12.6%, with Musk’s support for Trump and potential EV tax credit reductions.
ExxonMobil (XOM): +3.2%, bolstered by anticipated pro-oil policies.
Chevron (CVX): +2.9%, set to benefit from eased restrictions.
JP Morgan Chase (JPM): +8%, riding a wave of deregulation optimism.
Coinbase (COIN): +12%, as Trump’s pro-crypto stance boosts Bitcoin to record highs.
Losers:
First Solar (FSLR): -14%, facing potential rollbacks on solar tax incentives.
Enphase Energy (ENPH): -12.5%, losing ground due to an anti-green energy stance.
Sunrun (RUN): -18%, reflecting weaker support for solar.
iShares Global Clean Energy ETF (ICLN): -10%, impacted by a dampened renewables outlook.
Array Technologies (ARRY): -11.6%, a casualty of anticipated clean energy cuts.
With banks and oil companies poised for growth, and renewable sectors facing potential headwinds, Trump’s victory has already started reshaping market expectations.
Energy and Utilities in the Exit Polling
Exit polls from the 2024 election show that energy policies played a decisive role, underscoring voter interest in loosening restrictions on traditional energy sources. In Pennsylvania, where fracking has long been an economic staple, 65% of voters supported expanding natural gas production, seeing it as vital to job security and energy independence. This strong backing suggests that Trump’s pro-fossil fuel stance resonated deeply here, hinting that Pennsylvania will remain central in any national push for deregulation around fracking and natural gas.
In Michigan, 60% of voters expressed support for increasing domestic oil drilling. Many saw the push for local energy production as essential to addressing economic stagnation, with high energy costs ranking among voters’ top concerns. Meanwhile, in Texas and Ohio, exit polls indicate a clear resistance to EV mandates—over 58% of voters in both states opposed strict adoption policies, citing a lack of infrastructure and high upfront costs as barriers. National sentiment toward government-backed EV incentives was mixed, with just over half of voters supporting subsidies but wary of mandates. These numbers paint a clear picture for energy leaders: the appetite for deregulation is substantial, and voters are leaning heavily toward policies that prioritize energy affordability and local resource development.
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Conversation Starters
Senate Control and Energy Policy: GOP Senate majority bolsters Trump’s energy agenda with likely deregulation and industry support. (Vox)
Schneider Electric Sees Third Cyberattack in Two Years: Energy sector braces as Schneider’s latest ransomware attack disrupts operations. (CyberScoop)
NERC Recommends 35-GW Interregional Power Transfer Increase: Push for greater grid resilience leads NERC to propose major power-sharing expansions. (Utility Dive)
Good Bet, Bad Bet
Bad Bet: The “End of Oil” Prediction
Predictions of an imminent end to the oil era have haunted the energy industry for decades, with calls for peak oil production as early as the 1970s. Yet with Trump’s return and global energy demands continuing to grow, fossil fuels are likely here to stay for a while longer. Betting on a “quick end” to oil may be as misguided as it was half a century ago.
Good Bet: Enbridge (ENB)
With Trump’s return and a likely boost in domestic oil and gas projects, Enbridge (ENB) stands out as a strong play. The North American pipeline leader, already well-positioned in U.S. infrastructure, is set to benefit from any expansion in fossil fuel transport. Enbridge’s extensive network from Canada to the U.S. aligns perfectly with Trump’s policies, making it a top pick for investors looking to ride this energy pivot.
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