The Quiet Resurgence of Clean Energy ETFs
Despite U.S. policy rollbacks under the Trump administration, global clean energy innovation—driven by AI and rising electricity demand—continues to fuel ETF opportunities.
U.S. legislation concerning clean energy has shifted markedly recently, which has raised questions about the investment viability of the sector in the years to come. Having deemed ‘green energy’ as unreliable, President Trump and his administration have intentionally rolled back or eliminated many of the policies introduced by the Biden Administration, which aimed to support the clean energy development in the U.S.
As reflected in a White House memo released in July 2025, the Trump Administration has eliminated tax credits for clean electricity production and investment in wind and solar facilities. Moreover, through the U.S. Department of the Interior, new standards have been imposed that would effectively prevent new developments on federal land.
The actions of the Trump administration regarding clean energy come at a pivotal moment in U.S. energy, as the nation’s electricity consumption has started to rise after remaining relatively flat. A significant factor contributing to the increase in electricity consumption is Artificial Intelligence (AI).
Renewable Energy and AI
Amid recent shifts in the U.S. clean energy policy, some clean energy companies are benefiting from the rising demand for AI. Bloom Energy, a firm that designs and manufactures solid oxide fuel cells that independently generate electricity on-site for power generation in data centers, manufacturing, and other commercial sectors, is one such example. The firm recently announced it will deploy its fuel cell technology at select Oracle Cloud Infrastructure (OCI) data centers in the U.S. Bloom’s systems can provide clean power with virtually no air pollution and no water use, supporting Oracle’s efforts to use sustainable energy sources for powering Oracle Cloud.
Another firm that has benefited from AI is Oklo, a nuclear technology company that develops fission reactors - devices that use controlled nuclear fission to generate heat, which can then be used to produce electricity. Given the increasing role of nuclear energy in powering data centers, the firm’s value proposition aligns with the interests of hyperscalers.
As noted by the International Energy Agency (IEA), renewable energy is increasingly playing a role in powering data centers. Geothermal energy, sharing characteristics with nuclear power, is becoming an attractive option among renewable energy sources; technology companies are seeking collaborations with advanced geothermal firms to address the rising demand from data centers. For instance, Google and NV Energy entered into a green tariff agreement to commission 115 MW of new geothermal capacity developed by Fervo Energy, followed by another power purchase agreement between Meta and Sage Geosystems Inc. for a further 150 MW project.
Investing in Clean Energy
Although support for clean energy legislation may be waning in the U.S., it is important to remember that the investment opportunity is global, and investors can beneficially participate in the business activities of clean energy companies worldwide through ETFs. For Canadians seeking clean energy-focused investment options, the BMO Clean Energy Index (Ticker: ZCLN), iShares Global Clean Energy Index ETF (Ticker: XCLN), Harvest Clean Energy ETF (Ticker: HCLN), and CIBC Clean Energy Index ETF (Ticker: CCLN) are worth considering.
Both ZCLN and XCLN are designed to replicate the performance of the S&P Global Clean Energy Transition Index (formerly known as S&P Global Clean Energy Index), which has a high exposure to the theme of clean energy by investing in companies involved in clean energy-related businesses. The index seeks to reflect the performance of companies whose main business is clean energy, whether through clean energy production or clean energy equipment and technology.
HCLN invests in a portfolio of the 40 largest Clean Energy Issuers selected from the Clean Energy Investable Universe, providing investors with the opportunity for capital appreciation. The universe includes equity securities that are listed on select North American, European, and developed Asian stock exchanges that are categorized as renewable energy or renewable energy generation. The portfolio is equally weighted and follows a systematic process in selecting the top 40 largest Clean Energy Issuers measured by market capitalization and is reconstituted and rebalanced semi-annually.
CCLN seeks to track the performance of the CIBC Atlas Clean Energy Select Index, which is designed to provide exposure to a diverse set of U.S. or Canadian-based companies involved in the clean energy sector, including renewables and clean technology excluding MLPs.
Please note this article is for information purposes only and does not in any way constitute investment advice. It is essential that you seek advice from a registered financial professional prior to making any investment decision.
