Is sustainability/renewables still going to be pursued by big banks?

Bump

Both near and long term I don’t think there’s any reason not to shoot for renewables if that’s where your interests reside. If you believe in the AI / data center story, renewables are the cheapest long-term option to supplement power demand. Large tech companies are super ESG conscious, so as long as you believe in tech growth, don’t see any reason not to believe in the renewables space.

Solar and wind is dead. Don’t go

Heard from industry ppl deal activity is expected to slow a lot

I work in the space, my thoughts are below:

• Deal activity is likely to slow in the short term until there is more clarity on Trumps agenda on the IRA bill. Trump has publicly been opposed to ITCs, PTCs, RINs, etc. however these incentives disproportionately benefit typical republican stronghold communities and the midwest, which Republicans just flipped. If Trump aims to eliminate or minimize these policies, I'd imagine he'd get pushback from Republicans and Democrats in the House/Senate
• In the intermediate term, I'd expect deal flow to pick-up, but be below levels today. Clarity on where Republicans stand on these issues will be a key driver of how active the space remains during this period regardless of how much or little the IRA program is repealed.  While PE pushing money into pre-construction projects is likely to slow, I foresee O&G players and already established renewable/sustainable players continuing to allocate resources and capital into the space, albeit at a slower rate than we have seen in recent years
• Long-term, deal flow should remain high as energy transition is inevitable. Now whether this transition is completed by 2030 vs 2050 vs 2100 is a different discussion, but by the time current Junior Bankers move-into the VP+ range I'd imagine the sector will be regeared towards growth.
• For college students, I'd recommend you study and pursue what you are passionate-in. All-sectors, even though seen as historically recession proof (see Real Estate in 07/08 and Healthcare in 2020) experience ups and downs. While it may be a smaller pool of bankers in the space off the bat, those that work through and stick out the poor markets are primed for major benefits when things turn-around (see Tech after the dot com bubble).

Regardless of whether ESG / renewable projects are in decline, a sustainability major is useless and will add no value whatsoever to your resume.

Deal flow might shrink from an M&A perspective for some time like any industry. Anything that is profitable will be pursued and renewables are no exception. Banks have been and still will be the largest tax equity investors in renewables as they have the capital and the balance sheets to make tax equity a viable option. The IRA isn’t going anywhere because of all the money wrapped up in it. As long as money is flowing into the industry, which isn’t going to stop, renewables will still be a great path in my opinion. I interned at a renewables company last summer so my perspective is a little skewed.

I love to hear from someone on the bank side of tax equity deals about the current deal environment.