Trump GHG Rollback Sparks Investor Warnings on Costs, Chaos

Investors warn Trump's plan to rescind the EPA's 2009 endangerment finding will create regulatory chaos, stranded assets, and costly “whiplash” for American businesses.

The Trump administration’s plan to formally rescind the Environmental Protection Agency’s 2009 endangerment finding is drawing sharp warnings from asset managers who say the move will sow confusion and add significant costs for American businesses. The rollback removes the legal determination that carbon dioxide threatens public health, stripping EPA authority under the Clean Air Act to regulate emissions from cars, trucks, and power plants.

Investors say the real damage lies in uncertainty. Marcela Pinilla of Zevin Asset Management warned the repeal “creates profound uncertainty for companies that have already invested billions in emissions reduction,” leaving them exposed to stranded asset risk if policies reverse. Beth Williamson of Calamos Investments described the “stop-start” planning as injecting volatility deep into supply chains affecting semiconductors and industrial equipment.

Jonathan Pragel of Calvert Research and Management highlighted the costly irony: “The cost of eliminating this infrastructure, and then needing to rebuild it if there is another change in the reporting regime that’s a really expensive proposition.” Andrea Ranger of Trillium Asset Management warned of a “whiplash effect” as future administrations inevitably reverse course again, making it harder to pick long-term winners in the energy transition.

For multinational corporations, the repeal changes little operationally. European Union regulations, California state laws, and investor demands will continue to require rigorous emissions disclosure. Mark Wade of Allianz Global Investors noted that large U.S. companies cannot afford to ignore international investors who demand climate data. “If you start to remove that incremental buyer of risk, that’s a problem for share price valuations.”

The rollback faces significant legal exposure. A federal court ruled in January that the Department of Energy violated the law when it formed a climate science advisory panel whose report was used to support the repeal. Environmental groups have already pledged to sue.