Renewed Interest

The Fed's lowering of interest rates is much-needed good news for clean energy

- Written by: Damien Martin

One of the key selling points of clean energy, of course, is that it's renewable.

Once the infrastructure is built, nature supplies the fuel for solar and wind energy. The sun shines, the wind blows, and batteries store the surplus. It's renewable, and it's basically free. That's in sharp contrast to fossil fuel power plants, which require constant additions of fuel.

Building that infrastructure for clean energy means most of the cost comes upfront. And that means prevailing interest rates have a big effect on whether new projects get off the ground. Despite strong headwinds, including the shutting down of some projects near completion, recent Federal Reserve rate cuts have been welcome news for renewables.

STORMS & SUNSHINE

Renewables have seen a lot of ups and downs the last half-decade. Solar and wind power generation became cheaper than fossil fuel generation for the first time. The Biden administration supported clean energy and passed policy measures such as the Infrastructure Investment and Jobs Act and Inflation Reduction Act that funded renewable projects.