What Does Trump 2.0 Mean For SEA Climate Scene?

The prospect of a second Trump presidency is creating ripples of uncertainty across the climate technology landscape. Known for motto like “Drill, baby, drill” or calling climate issues all part of a “hoax” , a Trump return to the White House could reshape clean energy funding worldwide, forcing investors, nations, and startups to adapt. The potential consequences extend well beyond U.S. borders, impacting global geopolitics and climate innovation, particularly in Southeast Asia (SEA). Here's a closer look at what may lie ahead under Trump 2.0

For SEA: One less partner and one less competitor

Southeast Asia’s clean energy initiatives could face major funding challenges if Trump follows through on promises to cut climate spending and focus on domestic industries. The U.S. is currently a key partner in the Just Energy Transition Partnership (JETP) programs with Indonesia and Vietnam, designed to help these countries shift away from coal and adopt cleaner energy sources. However, a Trump presidency could see the U.S. disengage from these efforts, part of what experts call a likely “repeat of rollbacks and repeals.”

Such a move could significantly reduce pledged funds. The U.S. has committed $2 billion of the $20 billion pledged to Indonesia by wealthy nations and financiers, and $1 billion of the $15.5 billion allocated for Vietnam. A full withdrawal would leave these JETP programs struggling for resources—at a time when funds are already slow to materialize.

That said, an immediate shock is unlikely. The U.S. government isn’t a major direct funder of Southeast Asia’s energy transition. According to Joshua Crabb, head of Asia-Pacific equities at Robeco, bilateral U.S. funds for clean energy in the region totaled just $41 million between 2018 and 2022—2% of total financing from wealthy nations during that period. By comparison, Germany provided $1.4 billion, making it the top contributor. Much of the U.S. contribution comes indirectly, through multilateral lenders.

Still, a second Trump presidency risks ceding U.S. leadership in climate technology to China, a nation already expanding its influence in Southeast Asia’s energy sector. For Southeast Asian economies, which are grappling with both the impacts of climate change and shifting geopolitical dynamics, this presents a unique challenge and opportunity. Without strong U.S. involvement, these countries will have fewer bidders for the best climate technologies. At the same time, it may push them to develop stronger regional momentum and attract investment from other global players to fill the gap.

On the demand side, it is clear that technologies that solve real and existing world issues, coupled with being cleaner for the planet will continue to grow strong. But whether Southeast Asia can seize this moment to advance its clean energy goals and thrive sustainably will depend on how effectively it navigates the shifting global landscape. Opportunity favors those who adapt.

Trump Administration’s Retreat May Cede Climate Tech Leadership to China

Trump's first term included substantial efforts to undermine federal incentives for renewable energy. Paradoxically, the climate tech sector still advanced, driven largely by private investors stepping in where the government retreated.This time, however, the dynamics are more complex, as climate technology has increasingly become part of the geopolitical tech race between major powers. Key federal tax credits and grants that have nurtured innovations like carbon capture, green hydrogen, and electric vehicles (EVs) are at risk of severe cutbacks, compelling companies to recalibrate strategies.

In regards to clean technologies, since 2023, China has installed nearly 500 gigawatts of wind and solar capacity—equivalent to the combined capacity of France, Germany, and the UK. The country’s EV progress also has been nothing short of a miracle, EVs made up a remarkable 25% of all passenger car sales in the country, far outpacing the one in seven (14%) sold in the United States and the one in eight (12.5%) in Europe. The sales momentum shows no signs of slowing. According to HSBC, EV adoption in the world's second-largest economy is projected to soar to an impressive 90% by 2030.

It’s not just consumers driving the EV surge—manufacturing is thriving as well. Chinese brands now account for nearly half of all EVs sold globally, solidifying their leadership in the industry. One of the nation’s EV “darling child” - BYD is rapidly expanding into Southeast Asia, planning to establish new assembly plants in Cambodia and Indonesia, adding to its existing facility in Rayong, Thailand. This expansion holds significant promise for the field of climate innovation for Southeast Asia, paving the way for advancements from novel battery materials to more efficient charging infrastructure.

Urgency of Sustainable Development in SEA

Southeast Asia must act urgently to ensure a sustainable future. The region faces significant energy security risks, relying on the Middle East for 60% of its oil imports, which exposes it to geopolitical shocks like the war in Ukraine. In 2022, fossil fuel subsidies hit a record $105 billion, and without change, annual oil import bills could soar to $200 billion by 2050. Accelerating clean energy adoption could slash these costs to $90 billion, making the shift essential.

The environmental stakes are high. In 2023, 85% of the population endured air pollution levels above safe limits, leading to 300,000 premature deaths from outdoor pollution and 240,000 from indoor cooking fuels. Extreme weather, like record-breaking typhoons and flooding in 2024, is adding stress to communities and infrastructure.

Despite these challenges, Southeast Asia has massive potential in clean energy. The sector has created 85,000 jobs since 2019 and is growing rapidly. The region leads in solar manufacturing, with Vietnam, Thailand, and Malaysia among the top producers outside China. Indonesia, a major player in EV batteries and global nickel supply, plans to expand its 16 GWh battery capacity to 40 GWh by 2030, fueling the transition to electric vehicles.

Transportation emissions remain a challenge, but solutions are emerging. Biofuels meet 10% of road energy demand, while EVs already make up 15% of car sales in Vietnam and 10% in Thailand. Expanding public transit and electrifying two/three-wheelers, which are common in the region, could make a huge difference.

Southeast Asia also needs cleaner industries to stay competitive. Technologies like bioenergy, hydrogen, and carbon capture offer solutions for sectors like nickel refining, while Singapore is leading efforts to decarbonize shipping. 

Put The Technology Where The Problem Is

In the end, the key for SEA is the application of technologies that tackle real-world problems. The solutions that truly make an impact are those that compete head-to-head with fossil-based options—offering cost parity, better unit economics, strong product-market fit, smart distribution strategies, or just being ahead of the curve. It’s not enough for these technologies to simply "be green." They need to deliver undeniable competitive advantages to existing solutions. Only then can they be Trump-proofed, or even future-proofed for that matter.

This region has the tools and opportunities at its disposal. The moment to take action is now.