Biden Aims to Reverse Trump’s Environmental Policies
The author is an analyst of NH Investment & Securities. He can be reached at ys.hwang@nhqv.com. -- Ed.
Presidential candidate Joe Biden has announced aggressive environmental policy plans. If Biden’s lead in the polls increases after September, environment-related companies are likely to grab more attention.
Joe Biden strongly supports environmental policies
Joe Biden, the Democratic candidate for the US presidential election, has pledged to rejoin the Paris Climate Agreement and target zero-carbon emissions by 2050. As Biden’s plans aim to reverse Trump’s current environmental policies, share price volatility for related companies is likely to increase with changes in the polls.
If elected, Joe Biden has pledged to invest US$2tn in clean energy and the environment by 2035. This exceeds the European Commission’s plan to invest EUR1tn over the next ten years to implement the European Green Deal. In addition, Biden’s plan includes the concept of ‘environmental justice’, which seeks to provide equal economic opportunities for all US citizens.
Trump has withdrawn the US from multiple international agreements and revoked a number of regulations established during the Obama administration. If Biden’s lead in the polls increases after September or if he is elected on Nov 3, we believe that the US’s environmental policies will be strengthened and related companies in the EV/rechargeable battery, utility/renewable energy, and low-carbon industries will draw attention.
Rechargeable battery and renewable/high-efficient energy industries to gain momentum
In particular, Biden has pledged to have the Federal government purchase more than 3mn clean-energy vehicles and transform all buses in the US to zero-emissions by 2030. In the power sector, the Democratic candidate plans to achieve zero-carbon emission by 2035 and install solar and wind power generation facilities. In the agriculture and construction sectors, Biden will raise investment in both eco-friendly agriculture and energy efficient buildings.
According to Biden’s plan, carbon pricing policy will be implemented by 2025 and carbon tariffs will also be introduced. On top of that, subsidies on fossil fuels will be removed and strong penalties will fall on companies that fail to meet environmental regulations. In order to revolutionize clean energy, Biden also plans to create the Advanced Research Projects Agency on Climate and invest US$400bn over the next four years in R&D.
Joe Biden’s pledges are stronger than the EU’s Green New Deal plans and require massive investment, which should help to promote the growth of related companies and industries. Related domestic players include battery makers LG Chem and Samsung SDI, battery foil manufacturers SKC and Iljin Materials, and renewable energy players Hanwha Solutions and CS Wind.