Hua Cheng, portfolio manager at Mirova US, joins BNN Bloomberg to discuss green stocks seeing record highs and how they’re impacted by tariffs.

A surge in demand for renewable energy to power artificial intelligence systems is breathing new life into green stocks, with clean energy indexes outperforming major markets and even gold. Despite political headwinds and efforts to roll back environmental policies, investors are betting that AI’s growing energy appetite will accelerate the global energy transition.

BNN Bloomberg spoke with Hua Cheng, portfolio manager at Mirova U.S., and Greg Taylor, chief investment officer at Purpose Investments, about the rebound in green stocks, what’s driving renewed investor optimism, and how long-term fundamentals continue to support the sector.

Key Takeaways

  • The S&P Global Clean Energy Transition Index has climbed nearly 50 per cent since April, outpacing the S&P 500 and gold
  • AI’s surging power needs are boosting investor confidence in renewables despite policy uncertainty
  • Renewable firms hold key advantages with cost efficiency, faster deployment and fewer supply constraints
  • The index remains just half its 2021 peak, leaving room for further recovery as fundamentals strengthen
  • High-quality clean energy companies with strong balance sheets are well positioned for long-term growth

Hua Cheng, portfolio manager at Mirova U.S.Hua Cheng, portfolio manager at Mirova U.S. Hua Cheng, portfolio manager at Mirova U.S.

Read the full transcript below:

ROGER: Green stocks are seeing records in the world’s biggest trades, and our next guest thinks some companies are well positioned to navigate short-term headwinds and offer long-term opportunities. For more on this, we’re joined by Hua Cheng, portfolio manager at Mirova U.S. Thank you very much for joining us.

HUA: Happy to be here. Good morning, Roger.

ROGER: Let’s talk a little bit about your optimism. Why are green stocks surging this year?

HUA: We believe there are several reasons behind the recent strong performance. First, market expectations were very low earlier this year. Second, there has been increasing clarification on regulations, which turned out to be better than expected. And third, the fundamentals for renewables remain very strong.

ROGER: There have been concerns about what’s happening south of the border, and even here we’ve seen some pullback. Yet are businesses seeing the opportunities and saying there’s money to be made in this space?

HUA: We believe there are still long-term opportunities, even after the recent rally. On one hand, the fundamentals are strong, because long-term power demand in the U.S. is expected to be several times higher than in the past. On the other, renewable energy is well positioned with key competitive advantages. We also think the sector’s valuation remains reasonable.

GREG: This sector often gets caught up in politics, especially with what’s coming out of President Trump’s administration. Are there any technology challenges or issues these companies are facing?

HUA: Yes, definitely. In the short term, regulatory uncertainty could be a headwind for volatility and performance. But over the long term, fundamentals matter more — such as demand and supply dynamics, cost competitiveness, reliability and energy availability. Renewable energy is well positioned because costs have fallen significantly due to technological improvements, and capacity can be expanded more quickly — within 12 to 18 months rather than three to five years. For all these reasons, we believe renewables have strong long-term fundamentals.

ROGER: There’s been talk that China has taken control of the green wave. Are there concerns the U.S. might struggle to catch up?

HUA: Yes, that’s an important question for long-term opportunities. We believe governments are taking measures to protect domestic renewable supply chains. In the short term, regulations and tariffs are important, but in the long run, fundamentals matter even more.

GREG: It’s a pretty broad sector. Within renewables, is there an area you favour — such as solar, wind or geothermal?

HUA: We believe there are different ways to invest in the sector. One category includes pure-play renewable energy companies. The other includes diversified industrial or utility firms. Each has advantages and disadvantages. For example, the pure-play companies can be volatile due to regulatory or supply chain risks, while the diversified firms may offer a more attractive risk-reward balance. We focus on high-quality names in both categories.

ROGER: Okay, Hua, thank you very much for joining us today. We appreciate it. Hua Cheng is portfolio manager at Mirova U.S., and we were talking about the surge in green stocks.

This BNN Bloomberg summary and transcript of the Oct. 15, 2025 interview with Hua Cheng are published with the assistance of AI. Original research, interview questions and added context was created by BNN Bloomberg journalists. An editor also reviewed this material before it was published to ensure its accuracy and adherence with BNN Bloomberg editorial policies and standards..