Energy & Climate in Trump’s Second Term
Long read. 10 mins.
The views in this article are those of the author(s), and don’t represent the views of their employer or clients.
You may have noticed, if you pay attention to the news, that Donald Trump is once again President of the United States of America.
Of course this will have a multitude of implications for everything from trade to geopolitics to governance issues in America, which will no doubt be covered extensively elsewhere. But we wanted to focus in on the areas we know more about, so have asked ourselves, what does a second Trump presidency mean for our efforts to limit the worst effects of climate change, conduct science, and progress the energy transition?
Executive Orders
Trump started his second term with a flurry of executive orders, a number of which are relevant to climate and energy. Along with his cabinet selections, they show the direction the Trump-Vance adminstration will take (or attempt to take given the potential legal challenges they will likely provoke).
Rescinding Biden era Executive Orders
One of the widest-ranging executive orders Trump signed rescinded a whole host of Executive orders signed by his predecessor Joe Biden. Including orders on climate mitigation, financial risk, clean energy, environmental justice, and limiting oil and gas leasing in the Arctic.
Notice that the US will Withdraw from the Paris Agreement
This EO instructs the US Ambassador to the UN to withdraw from the Paris Agreement “effective immediately”. The withdrawal process should take a year, but this order also cuts all funding from the US towards the UNFCCC, essentially ending US contributions to things like the Loss and Damage fund.
Opening up Permitting of Energy Projects in Alaska
This is an order encouraging development of energy and other projects in Alaska, prioritizing LNG.
An order expressing Trump’s view that the federal government should do everything it can to encourage energy production on federal lands and waters, especially offshore.
It ends federal support for what is erroneously called the “EV mandate” (emissions standards), and even rolls back efficiency standards on lightbulbs and household appliances.
Halting Offshore Wind Permitting and Reviewing Onshore Wind Permits
An executive order that halts federal permits for new offshore wind projects, stalling a $25bn industry in its tracks and stopping energy production on federal lands & waters.
Declaring a National Energy Emergency
The real core of this administration’s energy policy is contained in this order. In our view, it is a contradictory bundle of rhetoric, exaggerations and manifest falsehoods. The contradictions between saying we need new energy but that clean energy sources don’t count, only make sense when viewed through the lens of the personal animosity Trump has to wind power in particular and President Biden’s legacy in general. It also holds up a promise Trump allegedly made to oil executives before the election, that he would help them if they gave him campaign funding.
The order states that:
“We need a reliable, diversified, and affordable supply of energy to drive our Nation’s manufacturing, transportation, agriculture, and defense industries, and to sustain the basics of modern life and military preparedness.”
Which makes sense. Then:
“The United States’ insufficient energy production, transportation, refining, and generation constitutes an unusual and extraordinary threat to our Nation’s economy, national security, and foreign policy.”
However, as many analysts have pointed out, the US is not in an energy emergency by any rational definition, it doesnt have insufficient energy production. It is the single largest producer and exporter of oil and natural gas in the world, and is the largest producer of oil - ever. Prices for gasoline have stablized after Covid. The grid is facing future load growth for the first time in a while, and transmission upgrades are badly needed, but if that were the sole issue, why not encourage all forms of new energy production and storage?
The real crux of this order, that attempts to remove permitting barriers, allowing bypassing of regulations like the Clean Water Act and Endangered Species Act, can be found in the new administrations defition of energy:
The term “energy” or “energy resources” means crude oil, natural gas, lease condensates, natural gas liquids, refined petroleum products, uranium, coal, biofuels, geothermal heat, the kinetic movement of flowing water, and critical minerals, as defined by 30 U.S.C. 1606 (a)(3).
Essentially, the order lists the types of energy the Trump administration likes. Fossil fuels, geothermal and nuclear are “good” energy, anything renewables-related doesn’t count as energy, especially offshore wind. This goes 100% against an idea that the Republican party had begun to coalesce around, and several cabinet picks professed their support for in their hearings, that they favor an “all of the above” strategy.
Drill Maybe Drill..
The administration is clearly pro-fossil fuels, but whether that translates to actual increases in oil and gas production is uncertain.
Despite being such a huge oil producer, the US does not have national oil companies. All the majors are privately owned, and buy and sell their products on the global market. So the administration can encourage drilling by opening up new lands and permits, but it can’t really make anyone drill baby drill.
The reality is that what Donald Trump wants (cheap oil) is not the same as what oil companies want (profits). This was reinforced by ExxonMobil’s Upstream President when he said in November “I think a radical change is unlikely because the vast majority, if not everybody, is primarily focused on the economics of what they’re doing.”
Already, there has been some interesting reporting on the fact that oil and gas companies are not that interested in exploring Alaska for new fields, plans for more LNG sales depend on demand from a Europe that now gets a record 47% of its electricity from clean energy and saw a 19% drop in LNG imports last year - despite record production in the US. O&G companies and especially OPEC want prices to stay high to increase their profits and are likely to be reluctant to lower them just because the new president asked them to.
What has been the effect (so far)?
Funding Cuts
The administration has paused funding that was promised within congressionally passed laws such as the Inflation Reduction Act and Bipartisan Infrastructure Act. Some of these funding pauses have been deemed unconstitutional by the courts, but at the time of writing the administration was still not in compliance with a court order to restore funding that they had frozen. The legality of cutting already congressionally mandated funding comes down to Congress’ constitutional role over the “power of the purse”. These laws have been passed, the funds appropriated and promised. Not paying has already led to layoffs as organisations wait for money they thought they would receive.
Renageing on paying these grants & loans would also put into question the trustworthiness of the US government’s word. If they can agree on a contract and then just not pay, how can anyone rely on future contracts?
Hammer Blow to Offshore Wind
The offshore wind industry has been particularly badly impacted by Trump’s early actions. The industry is very reliant on federal permitting processes within the executive branch departments such as the Department of Interior and the National Oceanic and Atmospheric Administration (NOAA).
The administration’s hostility to offshore wind has led to impacts on the supply chain, with one cable manufacturer cancelling plans to build a factory, as well as put on ice several potential projects.
In the words of Mark Twain:
Cheer Up, the Worst is Yet to Come
According to Heatmap news, anti-wind activists are reportedly lobbying to undo permitting decisions already made by NOAA to allow offshore wind farms on the East Coast to begin construction, which they are now in the middle of.
Crackdown on anything climate-related in Government
The Trump administration fired the EPA’s Clean Air Scientific Advisory Committee. The acting head of the EPA (before Trump’s pick Lee Zeldin was sworn in) said that the EPA would “update” the advisory committees to make sure that the agency “receives scientific advice consistent with its legal obligations to advance our core mission.”
The administration also closed the Justice40 initiative, set up to help communities disproportionally affected by air pollution and industry.
It also cancelled publication of the first-ever US National Nature Assessment and removed mentions of it from government websites, but as scientist Katherine Hayhoe reported on LinkedIn, the authors are keen to publish it anyway.
According to Wired, staff at NOAA, the National Oceanic and Atmospheric Administration who work on weather reports and permits, have been instructed not to work with foreign citizens. This will make compiling things like their annual flagship North American Seasonal Fire Assessment and Outlook, compiled with scientists from Mexico and Canada, impossible. Because who would need accurate and cross-border predictions of fire risks in today’s world?
Bloomberg has recently reported that “Top officials at the US Department of Homeland Security received a memo on Friday ordering an immediate stop to work connected to climate change and the elimination of climate-related terms across the agency. The memo instructs senior office heads to “eliminate all climate change activities and the use of climate change terminology in DHS policies and programs, to the maximum extent permitted by the law.”
The Department of Homeland Security oversees FEMA, the federal disaster response agency, among other groups. FEMA has had to respond to climate-induced natural disasters in California and North Carolina in the last year.
Layoffs & IT Access
One of the fastest-moving aspects of the new administration has of course been the actions of Trump’s head of the Department for Government Efficiency (DOGE) and “Special government advisor” Elon Musk. Following his acquisition of Twitter Musk fired 80% of the staff, and he is attempting the replicate this Silicon Valley “move fast and break things” approach to the federal government.
A lot has been, and will continue to be, written about Musk and DOGE, but some of the noteworthy actions related to climate and energy have been the entry of DOGE into the National Oceanic and Atmospheric Administration (NOAA). The Guardian reported that:
“They apparently just sort of walked past security and said: ‘Get out of my way,’ and they’re looking for access for the IT systems, as they have in other agencies,” said Andrew Rosenberg, a former Noaa official who is now a fellow at the University of New Hampshire. “They will have access to the entire computer system, a lot of which is confidential information.”
Project 2025, written by several former Trump staffers, has called for the agency to be “broken up and downsized”, claiming the agency is “harmful to US prosperity” for its role in climate science.
Just this week, the government fired thousands of “probationary” workers, who have been hired by various departments in the last two years. Early reporting suggests this has affected climate-related departments in particular. Federal employees in USAID, the Consumer Financial Protection Bureau, The Department of Education, and The Department of Energy were affected. Just one example of the affect this has had already is in the Pacific Northwest, where hundreds of employees were fired from the Bonneville Power Administration including:
“safety engineers, environmental scientists, along with “people who monitor and respond to urgent safety issues, folks who make sure Hanford workers’ rights are protected, and others who are absolutely critical to the Hanford cleanup mission and the safety of the workers there,” Sen. Murray (D.WA) said.”
The administration’s efforts to downsize the Department of Energy in particular have been eye-catching, as they desperately attempted to walk back their firing of key DOE staff involved in keeping America’s nuclear deterrent safe. Probationary staff at the NNSA were fired, apparently without anyone realising that their jobs literally involved making sure nuclear weapons don’t accidentally go off, and efforts to hire them back reportedly hit a snag as some managers didn’t have personal email addresses to contact them to give them their jobs back.
Is there any good news?
Lets be honest, the approach of Trump’s asministration, from what was spelled out in the pre-election guidebook of Project 2025, to the actions of the administration and even the selection of cabinet members, is nothing short of a full frontal assault on the idea that humans are causing climate change, that we should do something about that, and that we can improve the economy and people’s lives and prospects through a transition away from fossil fuels towards clean forms of energy.
However, just because those ideas are under assault from the current administration, doesn’t mean they are wrong, it doesn’t mean climate change won’t continue, it doesn’t mean that the energy transition can be stopped, and it doesn’t mean the rest of us have to accept this as a fait complit. So where are some positives in all this?
The Law
The administration seems to have taken the approach of executive order now, fight the legal battle later. This means that in the end, a lot of the orders undertaken are at least susceptable to be cancelled by the court system, as they all bypass Congress and some just flat-out breach the constitution.
Legal cases agains the administration are picking up steam and a string of early successes. Whether the administration abides by the rulings is another (more alarming) thing altogether.
Some of the best work being done tracking the impact of these laws has been by Columbia University’s Sabin Center for Climate Change Law.
On innauguration day they launched the Climate Backtracker, which records Trump administration actions to weaken or eliminate federal climate protections.
They Re-launched the Inflation Reduction Act Tracker (co-maintained with the Environmental Defense Fund) to track changes in the status of climate programs established via the Inflation Reduction Act
And they re-launched the Silencing Science Tracker (co-maintained with the Climate Science Legal Defense Fund) to monitor anti-science actions.
Scrutiny on Permitting
Trump’s new pick for Energy Secretary, gas executie Chris Wright, does not believe we are in an energy transition, or that CO2 should be considered pollution. But more encouragingly, during his confirmation hearings he said, “[climate change] is a real issue. It’s a challenging issue, and the solution to climate change is to evolve our energy system”.
He is potentially going to be supporting of permitting reform, saying “we must … permit and build energy infrastructure and remove barriers to progress, including federal policies that make it too easy to stop projects and far too difficult to complete projects”.
But given the administration’s definition of energy it is likely this will prioritize permits for oil and gas pipelines rather than the transmission grid upgrades that are sorely needed. Permitting is a thorny political issue and will remain an area of great interest in the next 4 years.
Some technologies may escape unscathed
The new Energy Secretary is also a fan of nuclear power and geothermal, calling himself an “unabashed steward for all sources of affordable, reliable and secure American energy.” So perhaps some clean energy sources will be able to compete with fossil fuels during this term.
Nuclear in particular is experiencing a renaissance with bipartisan support. New Small Modular Reactors (SMRs) and Advanced reactors are being developed by several companies in the US and are reaching the point where construction could begin in earnest in the next few years. There are some very promising designs that could help match the projected load growth on the grid and complement the inherent intermittency of new renewables as they come on line. If these plants can deliver on their affordability promises, and get built in a relatively timely manner, a re-kindled domestic nuclear industry could help build a backbone of clean energy generation into the future.
Geothermal energy is also experiencing a resurgence and has bipartisan support, thanks in part to technological breakthroughs by companies such as Fervo energy that could vastly expand the potential sites for cost-effective geothermal plants.
There has not been much mention of the Solar or battery industries by the new administration. Solar has seen an annual growth rate of 26% in the US in the last decade and is taking large market share in places like Texas, which saw more solar and batteries added than any other power source. Both industries may well hope that they can continue their economy of scale-powered growth under the radar and away from partisanship.
Non-federal actors
The states still have a lot of agency here. They picked up the slack during the last administration and could once again form a “coalition of the willing”. A number of states, incuding California, Hawaii, Colorado, and New Jersery, are currently suing oil and gas companies for damages related to extreme weather events that can be more accurately and attributed to climate change with advances in climate science. The Supreme Court recently refused to hear an appeal from the O&G companies who argued the lawsuits should be stopped, meaning the cases will proceed in State court. Not all of these cases will succeed in bringing accountability to the poluters ————
Cuts in funding to the UNFCCC will be damaging, but encouragingly Michael Bloomberg has announced:
“Bloomberg Philanthropies and other U.S. climate funders will ensure the United States meets its global climate obligations following the federal government’s intent to withdraw from the Paris Agreement for the second time. This includes covering the funding gap left by the United States to UN Climate Change (UNFCCC) and upholding the country’s reporting commitments.”
This is a really important intervention that will help vulnerable countries enormously. It also send a message, that philanthropy in general, and funding from the private sector more broadly, has a huge opportunity to do something useful with the records levels of wealth held by the very richest in society, and step in to help those hardest hit by natural disasters, as well as fund mitigation efforts. 25 people in the US, including Michael Bloomberg, reportedly have more wealth than the US treasury, so some of that wealth being used to step in where the US govt is stepping back should be welcomed and encouraged.
The economics of the energy transition will win in the end
In the end, the outcome will likely be dominated by the economics of the transition and there are many economic trends that show the potential advantage of clean energy technologies. The price of batteries has declined by 97% in the last three decades, the price of solar panels has dropped precipitously and we continue to underestimate just how much clean energy we will produce every year.
Many forms of clean energy, especially batteries and solar, are well on their way to being much cheaper than fossil fuel alternatives, and are already more efficient and more convenient. In a market-driven economy once that happens the sheer economics of the new technologies will mean they will continue to proliferate, with or without federal support. Of course their adoption would be helped if the government supported them.
The energy transition doesn’t have to come at the expense of economic growth either, far from it. The economic opportunities of the transition, of clean air, of avoiding ludicrously expensive cleanups from natural disasters, will exert their own gravity in the end.
The economics of things like insurance are also under stress from climate change, and may lead to a reckoning on that front, with home insurers backing out of operating in states like Florida and California.
In the end, we have to realize that stopping the worst effects of climate change will be much cheaper than dealing with the consequences of an alarmingly warmer world.
Climate effects will continue
Don’t know your Feedback Loops from your Tipping Points?
Here is a Borrowed Earth Explainer.
While hardly a positive, the science clearly tells us that we are already seeing the effect of a warmer world and are dangerously close to cloud cover and ocean circulation tipping points and feedback loops. The climate doesn’t care who is President, only how much greenhouse gases are in the atmosphere and how warm the air and oceans are. This will mean climate-related extreme weather events will continue. This isn’t an issue that will go away.
The problem is, science tells us we are running out of time to avoid the worst effects of climate change, and anything that slows us down will also make those effects worse. In that regard, the way the Trump administration has begun its 4 year term is a disaster. But every fraction of a degree counts. If we miss 1.5°C, the next target is 1.51°C, not 2°C.