By Haley Zaremba
There’s a huge misconception about renewable energy that needs to be thwarted if the industry is ever to achieve its full potential. When you think about the average proponent of wind, solar, green hydrogen, and other cutting edge climate-friendly alternative energies, who comes to mind?
Probably not a registered Republican who has spent his career fighting against hydropower and homeowners’ ability to install solar panels. And yet that’s exactly who is at the helm of NextEra Energy Inc., the single largest investor-owned wind and solar company in the world.
An article this week from Bloomberg profiles the rise of James Robo, CEO of NextEra Energy, a man who is everything you would think a renewable energy CEO isn’t, and who has nevertheless quietly climbed to the very top of the green energy game. “America’s Greenest Energy Giant Isn’t Trying to Save the Planet,” proclaims the headline from Bloomberg Quint. But, despite that fact, his company has made a name for itself as an “unlikely green giant with a knack for throwing its considerable weight behind initiatives and policies that are pushing the U.S. into a future of zero-emissions electricity.” And, despite the CEO’s decidedly conservative politics, “few companies appear better poised to benefit from the Joe Biden era.”
How do we square this reality with the perception of green energy as a partisan pet project of earthy, crunchy granola people? Well, we need to understand that our perception of green energy is misguided and outdated. It’s no longer an idealist environmentalist’s pipe dream. Green energy makes practical, financial, fiscal sense. It’s the future and the future is now.
That’s why, even though James Robo fell into renewable energy as a fluke, he’s held on tight. “Founded as an ordinary Florida utility almost a century ago, [NextEra Energy] backed into renewables by taking a stake in early wind farms whose developers owed it money,” reports Bloomberg. “Since then it has shrewdly used dealmaking, scale, tax credits, and aggressive lobbying to grow into a powerhouse—all while keeping such a low profile that most people have never heard of it.” While Robo is far from a Muskian CEO with a large twitter presence and iconoclastic ideals around climate justice, his company is, nonetheless, pushing the energy industry as a whole further into greener pastures–and it’s enjoying quite a nice profit margin while doing so.
As the cost of producing renewable energy has continued to plummet in correlation with technological advances in recent years, NextEra has been raking in the dough, even under the oil-loyal Trump administration. “Despite tariffs on solar equipment from China and aggressive federal efforts to boost coal and gas, its profits rose from $2.9 billion in 2016 to $3.8 billion last year.”
NextEra Energy is just one of many renewable energy companies that are projected to see major growth in the coming years–at a time that energy stalwarts are looking at nearly unilateral decline in both demand and profits coming down the pike. In fact, even Big Oil’s supermajors are scrambling to diversify–the writing is on the wall. The global clean energy transition is underway, and it’s only going to accelerate. The Biden administration will be especially kind to these companies, as part of his platform includes “an ambitious $2 trillion proposal focused on creating a nationwide emissions-free electricity grid in just 15 years.”
Peak oil is upon us, and anyone hanging onto fossil fuels is doing so out of ideology instead of investment acumen. Yes, of course our world still runs on oil, and will continue to do so in large part for many years to come–to deny that is foolhardy. But the oil era is coming to an end, and any forward thinkers would be wise to jump ship. Letting go of that attachment to the legacy of fossil fuels is exactly what led James Robo and NextEra Energy to running an ultra-successful renewable energy company whose market value competes with that of Exxon Mobil Corp. In fact, across the board, the newest wave of energy giants are renewable energy companies, and those reluctant to accept that fact will almost certainly be left behind.
By Haley Zaremba for Oilprice.com