A stunning rally in global clean-tech markets has defied political headwinds in the United States, with green stocks soaring nearly 50% this year—outpacing most other equity benchmarks and signaling renewed investor confidence in the low-carbon economy. The surge comes even as President Donald Trump dismantles federal support for renewable energy, underscoring the growing role of market forces, artificial intelligence (AI), and China’s industrial expansion in driving the energy transition.
Market Rebound Defies Political Climate
After years of underperformance, clean-tech equities have delivered one of 2025’s most lucrative returns. The S&P Global Clean Energy Index has gained around 50% year-to-date, compared to less than 20% for the MSCI World Index. Analysts link the boom to two dominant forces reshaping global energy demand: the explosive rise in electricity needs from AI-driven data centers and China’s continuing investment in low-carbon industries.
This momentum has lifted investor sentiment despite Trump’s rollback of green subsidies and regulations.
“Investors have been too distracted by Trump’s anti-green rhetoric,” said Aniket Shah, global head of sustainability and transition strategy at Jefferies. “The $2 trillion in low-carbon spending last year is an insane number—it shows the green economy is having a wonderful moment.”
AI Demand and China’s Green Expansion
Behind the surge lies an unlikely alignment between technology and sustainability. AI’s vast power requirements have forced companies such as Amazon, Microsoft, and Google to seek low-carbon energy sources to meet corporate climate targets while keeping costs down. At the same time, China’s aggressive green industrial strategy has made it the world’s largest exporter of clean-tech components, feeding demand in emerging economies and solidifying its dominance in the renewable supply chain.
Yet this rebound carries a paradox. Electricity use from AI infrastructure is expected to quadruple within a decade, according to BloombergNEF. While renewables will supply much of that growth, fossil fuels are still projected to play a major role—potentially raising emissions even as investors profit. As world leaders prepare for COP30 in Belém, Shah cautioned that “the planet is on track to miss not only the 1.5°C target, but also 2°C.”
Analysts Warn of AI-Driven Volatility
Some investors remain wary that clean-tech’s rally could prove fragile if the AI bubble bursts. Renaud Saleur, chief executive of Geneva-based Anaconda Invest, warned that many outperforming stocks “are not really the quality ones,” and that “the extra demand for AI is impossible to fuel.”
Tim Bachmann, climate-tech portfolio manager at Deutsche Bank’s DWS unit, referenced the “DeepSeek moment”—when a Chinese AI startup revealed a low-cost, energy-efficient model—as a sign that markets could rapidly shift.
“It was a shock not only in the data-center operators, but also in the suppliers of cooling and power equipment,” he said.
Others, including Deirdre Cooper of Ninety One and Alex Monk of Schroders, are avoiding speculative bets. Cooper said her firm is “careful to avoid the hype” around green stocks caught up in AI euphoria. Monk noted that while sustainable energy held up relatively well during recent AI volatility, “a bursting bubble could drag the entire sector down.”
Fuel Cells and Fast-Track Deployment
One of the standout performers is Bloom Energy Corp., whose solid-oxide fuel cells provide on-site power for data centers. Its stock is up nearly 500% this year after signing a deal with Oracle to supply energy for AI operations. The company plans to double manufacturing capacity by 2026, appealing to investors eager for quick-deploy energy systems amid grid bottlenecks.
“Their product is tailored to the AI data center demand dynamic,” said Christopher Dendrinos of RBC Capital Markets.
Despite its use of natural gas—ironically benefiting from Trump-era incentives—Bloom argues its fundamentals justify the surge.
“We’re not a startup anymore,” said Michael Tierney, Bloom’s head of investor relations. “We have a significantly better balance sheet and strong anticipated demand.”
Still, Bank of America analysts caution that Bloom’s share price may be running ahead of its earnings potential. Such warnings highlight the fragility of a sector still recovering from post-pandemic lows, when rising interest rates and weak policy signals triggered a massive sell-off.
Financing the Transition
For large asset managers, the current rally feels more grounded. Brookfield Asset Management recently raised $20 billion for the world’s largest private clean-energy transition fund and pledged up to $5 billion to deploy Bloom Energy’s fuel cells at new AI-powered data centers. Natalie Adomait, Brookfield’s chief operating officer for renewables, said low-carbon sources are “quick to bring online” and increasingly critical to AI infrastructure.
At BlackRock, portfolio manager Charles Lilford sees resilience even if the AI market cools: “We don’t correlate any potential ‘AI bust’ as an existential risk to sustainable energy equities.”
Meanwhile, Apollo Global Management projects that global energy demand from AI “will not be closed in our lifetime,” underscoring the scale of investment still to come.
Economic Logic Over Ideology
Despite the Trump administration’s anti-green stance, market dynamics appear to be winning out. Analysts say Trump’s “One Big Beautiful Bill” has been less damaging to renewables than feared. Demand for solar and wind now reflects economic pragmatism rather than climate ideology.
“If you’re offering green electrons to a company, they can be agnostic as long as you can promise delivery,” said Timothy Ho, utilities and renewables analyst at Amundi.
Even so, Joseph Osha at Guggenheim Securities notes that the rebound largely represents “recognition that the business can survive” rather than proof of full recovery.
Clean-tech leaders like SunRun and SolarEdge remain well below their pandemic-era highs.
“When you have these broad thematic flows, markets can detach from fundamentals,” Ho warned. “That’s what investors need to keep in mind.”
Related Story: Despite Political Swings, Green Economy Investing Blooms On
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