2025 Policy Forecasts: Energy & Industrials
Welcome to Capstone’s annual forecast of unappreciated policy and regulatory themes companies, investors, and, industries should expect to play out over the course of the year in the energy sector.
Power Moves: How Trump’s Agenda Will Shape a Fossil Fuel Revival
Capstone believes President Trump will use tariffs aggressively, prioritizing tariffs on products imported from China, and will move forward with a 10%-20% universal tariff. These actions threaten import-exposed industries, including energy, autos, tech, retailers, and healthcare. However, we believe President Trump’s protectionist instincts may be tempered by a broader concern for the stock market and retaliatory tariffs from China, resulting in tailored tariffs.
Tariff Tango: Trump’s Trade Moves to Shake Up Global Markets
Capstone believes President Trump will use tariffs aggressively, prioritizing tariffs on products imported from China, and will move forward with a 10%-20% universal tariff. These actions threaten import-exposed industries, including energy, autos, tech, retailers, and healthcare. However, we believe President Trump’s protectionist instincts may be tempered by a broader concern for the stock market and retaliatory tariffs from China, resulting in tailored tariffs.
Sustainability in the Crosshairs: Republicans’ Energy Strategy Targets Renewables, But Avoids Worst-case Scenario
Capstone believes the Trump administration will lean heavily on executive action to implement its energy agenda. Looking at Congress, with slim majorities and a host of priorities outside of energy, we believe Republican lawmakers will shy away from major action on energy. On balance, we believe the result of this dynamic will allow renewables to avoid a worst-case scenario.
Shifting Gears in Environmental Policy: Federal Slowdown, State Action
Capstone believes that although federal environmental regulations will slow with the incoming Trump administration, regulators will likely not fully roll back Biden-era PFAS rules—a positive for utilities and waste management companies. However, blue states are likely to implement environmental policy aggressively, providing a blueprint for future federal regulation and creating opportunities for environmental consulting companies.
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