Which Are The "Stranded Assets" Now?

Manhattan Contrarian ^ | 18 Jul, 2025 | Francis Menton

[MtnClimber]

How quickly things change. It was only two years ago, in 2023, that I was writing posts compiling long lists of quotes from climate activists warning that all assets used for production of coal, oil and gas were about to become obsolete and “stranded.” After all, wind and solar were (supposedly) cheaper and cleaner for generating electricity, which could then power anything and everything. Therefore anyone stupid enough to make further investments in producing fossil fuels would lose everything. Here is one such post from June 2023, and another from February 2023.

If you look today, you can still find predictions in 2025 that fossil fuel assets will shortly become “stranded.” (Here is one from Bloomberg from March 6: “Investors Risk $2.3 Trillion of Stranded Fossil Fuel Assets.”). But such predictions are becoming fewer and fewer. Instead, what looks far more likely is that large portions, if not the entire business, of “renewable” electricity generation from wind and sun is likely to get “stranded.”

Consider the latest from the UK. The current Labour government of Keir Starmer, elected just a year ago, is languishing with record-low approval ratings. A YouGov poll in May found Labour with just a 23% “favorability” among the populace, compared to 32% favorability for the Reform Party of Nigel Farage (and 16% favorability for the Conservatives). In other words, if and when the next election is held, Reform could well prevail. Meanwhile, the Reform Party has broken with the former all-party consensus in favor of “net zero,” otherwise known as endless subsidies for wind and solar power.

Two days ago, on July 16, the Deputy Leader of the Reform Party, Richard Tice, wrote to heads of UK renewable energy companies to advise them that a Reform government headed by Nigel Farage would terminate the subsidies for wind and solar energy. Here is a copy of one such letter sent by Tice to Greg Jackson, CEO of Octopus Energy; and here is a July 17 press release from Net Zero Watch publicizing Tice’s initiative. Tice’s letter specifically warns wind developers that if they are granted subsidies in an upcoming round of handouts from the Labour government dubbed “AR7,” a future Reform government will not continue those subsidies:

Let me be clear: if you enter bids in AR7, you do so at your own risk. The political consensus that has sheltered your industry for nearly two decades is fracturing. Reform UK will not be bound by the assumptions or commitments of this failing Labour government.

And from Net Zero Watch’s press release:

Richard Tice is absolutely right to put developers on notice that any new investments will become stranded assets under a Reform government. . . . [T]he real problem with renewables is not political risk but nature itself: the fundamentals of physics and economics, which make wind and solar inherently uneconomic. The industry has been constructed on subsidy, not on market fundamentals. After decades of windfarm handouts, consumers can no longer afford to foot the bill. Politicians can’t override physics or economics - no matter how much they subsidise failure.

The prediction that wind and solar assets will become “stranded” is fundamentally different, and fundamentally sounder, than the comparable prediction for fossil fuel assets. That is because wind and solar generators are entirely a creation of taxpayer subsidies. Without the subsidies they are uneconomic, and they will be worthless the minute the subsidies are withdrawn. In contrast, the fossil fuel assets are economic without government support. The prediction that fossil fuel assets will become “stranded” is based instead on a belief that governments will intentionally destroy these assets in their zeal to stop CO2 emissions. But that means that governments will continue a war on fossil fuels even as it becomes obvious that the alternatives are hugely more expensive, and as consumers are forced to bear the costs of soaring energy prices. My own prognostication is that even the craziest governments will relent in their efforts to destroy the fossil fuel businesses as the costs of doing some become ever more evident.

Back here in the U.S., the Trump administration and Congress have now, via the One Big Beautiful Bill Act, put apparent end dates on subsidies to new wind and solar projects not yet initiated; but they have not threatened to pull subsidies from wind and solar projects that have gotten built based on a commitment of subsidies (particularly tax credits) during the useful lives of the facilities. As such, there would appear to be reason for owners of existing wind and solar facilities to hope that their investments will not become stranded. But it is not a sure thing. There are several ways for the wind and solar investments to fail even if the existing subsidies continue at currently committed levels. For example, wind and solar facilities could turn out to need more maintenance than anticipated to keep going; and if governments will not agree to increase the subsidies at that point, the assets will become stranded. Also, if the end of subsidies for wind and solar developments puts an end to construction of those, then the investments in facilities like factories to make wind turbine blades will become stranded.

Another thing that can and should happen is that the grid operators around the country should restructure the markets by which they acquire electricity from power facility operators to make it such that the grid only buys power that is dispatchable. Such a reform — which is highly desirable — would leave all wind and solar generators stranded.

Back in the oil and gas business, things are booming. Oil and gas production are hitting annual records. The demand for reliable energy only goes up. Anyone who thinks those assets are going to get “stranded” is delusional.

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TOPICS: Business/Economy; Science; Society
KEYWORDS: energy; greenenergy; ripoff; scam

[MtnClimber]

It would be nice to get nuclear power to handle the base load. Maybe we will have fusion in the future.

[Red Badger]

$0r0$ was buying up all those supposedly ‘stranded assets’ for pennies on the dollar.

That’s how he makes his billions.

Fear of the unknown by the uneducated...........

[Tell It Right]

Nuclear is great from a physical science perspective. Unfortunately, we have to make sure we've won the political science battle, or the left will figure out a way to shut down nuclear plants like they've done coal plants.

Look at how quickly they changed their minds on what during the Obama admin they called "clean burning natural gas". Since then the Dims have tried to ban nat gas. They'll do the same with nuclear, even though now they're touting nuclear as much as Republicans are.

[Tell It Right]

Nuclear is great from a physical science perspective. Unfortunately, we have to make sure we've won the political science battle, or the left will figure out a way to shut down nuclear plants like they've done coal plants.

Look at how quickly they changed their minds on what during the Obama admin they called "clean burning natural gas". Since then the Dims have tried to ban nat gas. They'll do the same with nuclear, even though now they're touting nuclear as much as Republicans are.

[lgjhn23]

“...It would be nice to get nuclear power to handle the base load. Maybe we will have fusion in the future....”

With Jimmuh Cartah, along with many of his insane lik-minded ilk, now dead and/or proven wrong, the USA might see a rebirth in nuclear energy for base loading, especially with the huge base-load power requirements of the near future AI. The technology of such plants has advanced quite a bit over many of the existing ones as well.

[Liz]

FTA-—grid operators around the country should restructure the markets by which they acquire electricity from power facility operators to make it such that the grid only buys power that is dispatchable. Such a reform — which is highly desirable — would leave all wind and solar generators stranded.

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This would leave all wind and solar generators stranded.

Good.

[AppyPappy]

Liberals: “We want green energy for everyone else but not us. We want dependable power and don’t care where it comes from”

[montag813]

Reform will never be in power. There are far too many Muslim voters at this point, and even more by the next election.

[BobL]

“...specifically warns wind developers that if they are granted subsidies in an upcoming round of handouts from the Labour government”

I LIKE IT - letting these grifters know that they’re ON THEIR OWN if the UK doesn’t manage to first ban the Reform Party. If they don’t pay attention to this warning, they will be at the mercy of their ‘investors’ when Doomsday hits.

[catnipman]

no thinking person paying attention EVER believed that wind and solar would supplant fossil fuel energy and that fossil fuel production would go the way of the Dodo bird ... consequently, the SMART people invested heavily in the fossil fuel industry whenever significant dips occurred, ignoring the lies, propaganda and BS from climate bullshit alarmists and anti-energy forces ...

[silent majority rising]

Brilliant article and very timely. I surveyed across the landscape recently and noticed the skyline of ugly windmills. I thought to myself, what are they going to do with all those monuments to government stupidity? You can’t even bury the damn things environmentally, so perhaps they should send them all to the liberal states that forced this subsidy industry on us.

[Wally_Kalbacken]

My introduction to stranded assets came in the regulated electric utility industry. I was employed in the area of demand research and electric rate design as I worked my way through law school back in the 1990s. Stranded assets back then typically represented an investment in a long-lived asset (e.g., land lines) that the regulators allowed you to recover over some very long period (say 45 years), which was then obviated by a sudden technological change (e.g., advent of cellular telephony). The question was, what do you do with the stranded asset of land line investments when it is no longer necessary, but still has decades to go before it is paid for under the regulatory structure.

When I left that industry, I left those questions behind. However, I have seen numerous examples of bizarre behaviors and investments that exist solely because of regulatory guidelines and incentives, which have led to stranded investments in “green energy.” My recent favorite is the solar installation located in the desert off I-15, near the state line dividing California and Nevada. It was a Federal investment, several $B, made in the late Obama Administration. Intended to last until approx 2040, but currently headed for shutdown and obsolescence because it produces energy at a cost about 3x current market prices. D’oh!

[silent majority rising]

Are you talking about the mess as you approach Palm Springs? How ugly is that? I look forward to when the nuclear power plants are put back in service, and they will be. I know of folks working on minature reactors where a whole city can be powered with a car sized reactor. When they can get a viable fusion mini reactor that will fit in the trunk of a car and enable it to run without external fuel for the life of the car, then you know we will be in a good place.

[Wally_Kalbacken]

It’s in CA, near Primm, NV. From I-15 it looks like a black blanket has been spread across the desert. That is a massive array of mirrors that focus the abundant sunlight on a tower containing tubing that converts water to steam, which is used to drive turbine generation. It turns out to be uneconomical to produce energy that way, and two of the three utilities involved have withdrawn, with the third on its way out the door.