Six stories that will set the pace for climate investors in 2025
Best of our Zeus column outlooks for renewable energy and climate challenges
. . . . The New Year has just begun and already we’re exhausted. The Santa Claus stock rally provided only coal to climate investors this year. The interest rates outlook, just a few months ago a sure thing, is now anything but. And in three weeks the world turns upside down when Donald Trump becomes president again.
We spent the better part of the holidays in the UK with family — shopping among the London Christmas lights, celebrating NewYear’s in a 500-year-old coach house in the Cotswolds, and contemplating the curious similarities between Oliver Cromwell and Elon Musk.
Now we’ve got a knee replacement scheduled for later this week which should make the first quarter even more challenging.
Fortunately, we’re on top of all you need to know heading into a big 2025 with a selection of our most prescient Zeus outlook columns from last year, including what to expect in energy circles as the year begins.
We‘re excited to be back with you and hope you had a restful and cheerful holiday. But it’s time to buckle up for a wild year to come.
— Callaway Climate Insights
Today’s edition of Callaway Climate Insights is free for all our readers. We really want to bring you the best and latest in climate finance from around the world.
. . . . Howard Lutnick and the battle for Trump's climate agenda: President-elect Donald Trump’s nomination of Wall Street veteran Howard Lutnick for commerce secretary might look like a consolation prize for not getting Treasury, but actually it positions Lutnick to have vital control of Trump’s climate agenda. Whoever joins Trump’s second-term cabinet will face a brutal and likely fleeting competition with other cabinet members as everyone vies for the chief’s affections, if the first term is anything to go by. But Lutnick will have leeway over Trump’s tariff plans as well as control of the weather and climate science agencies that Trump despises.
. . . . Donald Trump’s stunning comeback win is set to chart the U.S. on a new course of chaos and power-grabs in the coming years. But it’s not a death knell for clean energy investors. Instead, the renewable energy transition will be rebranded as a push for more energy security and global energy domination. It will include oil and gas, but also other forms of clean energy popular in red states, including solar and onshore wind. And it will include new tax breaks as well as tariffs and changing laws. At least one company has already benefited. Tesla’s shares rose 14% the day after the election. Here are five themes that investors should look out for, and who will win or lose in each.
. . . . Clean energy production is soaring at such a rate that electricity produced by renewables such as solar, wind and battery will exceed what is produced by coal next year, the International Energy Agency said in its annual renewables report. That growth, which is expected to triple worldwide by 2030, is a rare piece of good climate news these days but underscores the challenges ahead in finding ways to distribute all that energy. While energy production soars and demand leaps for electricity to fuel more and more data centers for AI, aging electric grids aren’t keeping up with the pace. That points to a coming new era in private and localized energy distribution, led by big tech companies and probably leaving government behind. Investors should pay heed to the challenges, and opportunities.
. . . . A growing market for catastrophe bonds is the new game on Wall Street, as hedge funds try to outwit insurance companies in the business of predicting extreme weather events. The $45 billion cat bond market has proven to be among the most successful strategies among hedge funds, as investors take the other side of the bet that major storms will devastate a specific area, such as Florida or Texas or California. But betting against climate change is like betting against the house in a casino. You play long enough, you’re going to get burned.
. . . . Tech entrepreneur John Mills didn’t set out to jump into the climate business when a wildfire threatened his Sonoma County home five years ago. He just wanted to find out what was going on. But by rounding up some of the best radio operators and fire volunteers in California to found Watch Duty, a non-profit app that tracks wildfires out West, Mills inadvertently created a new type of climate media. A just-the-facts-ma’am, fast-breaking reporting, social media service that is quickly becoming a must have for anyone in a wildfire area, and for any of the tens of thousands of people who fight them each summer. David Callaway takes a look at Watch Duty.
. . . . The annual Doomsday Clock announcement, for decades a symbol of the scientific community’s concern about humanity destroying itself, is sometimes derided by critics as a stunt. But the people who run The Bulletin of the Atomic Scientists, founded by Albert Einstein (with help from Robert Oppenheimer) are deadly serious about it. The clock is just a symbol, but an important one. Once a year the scientific community actually puts a number on the threat to the world, expressed in ways we can all understand, in seconds and minutes. It’s worth paying attention to as this column from last year argues, and this year’s announcement approaches in a few weeks.