President Trump’s return to the White House appears poised to throw a wrench into the U.S.’s energy transition — though not to stop it.
Trump repeatedly pledged on the campaign trail to implement policies favorable to the fossil fuel industry and roll back incentives that have boosted the renewable energy sector in recent years. On his first day in office, he signed executive orders to bolster oil and gas drilling, halt all new offshore wind leases and freeze funding from the Inflation Reduction Act (IRA) and Bipartisan Infrastructure Law, which allocated billions toward clean-energy projects.
Trump is expected to continue pursuing a fossil fuel-friendly agenda moving forward, and his picks to lead the federal government’s energy and environmental agencies look set to follow his lead.
Their moves are likely to hinder the pivot to lower-carbon energy sources, experts within the burgeoning renewables industry say. But they note that much of the transition is already underway, and they say the administration’s policies are not likely to stop or reverse it entirely.
The administration’s opposition to renewables comes in the context of massive private growth in the industry that’s unlikely to come to a grinding halt.
In recent years, even as domestic oil and gas production have climbed to already record levels, the country — and the world — have also drawn an increasing share of their power from renewables such as solar and wind. In 2023, according to the Energy Information Administration, such sources supplied about 21 percent of electricity generated in the U.S.
In its 2024 report, the International Energy Agency projected that renewables will comprise half of global electricity demand by 2030, with 80 percent coming from solar.
The report, which predates the presidential election, attributes much of the anticipated growth to “supportive policies and favorable economics,” but the U.S. and its policies in particular were not projected to play the largest role even before Trump’s return to the White House: China is expected to drive up to 60 percent of the growth, while India’s renewables sector is growing faster than any major economy.
Lori Bird, director of the World Resource Institute’s (WRI) U.S. Energy Program, noted that the sector also saw growth during Trump’s first term, and that incentives aimed at supporting its continued development are likely to remain in place over the next years.
The fate of renewable energy tax credits included in the IRA, which even some Republicans have called to retain, will be one of the most pivotal open questions for energy going forward, she said.
“That’s one of the biggest things that’s really important for the clean energy industry, particularly on the power sector side of things,” she said.
But in addition to those tax credits, Bird noted that efforts by municipalities, states and large corporations are ongoing, even if they don’t have support in the White House.
And demand from the private sector is continuing to build.
“The tech sector, in particular, a lot of these large companies … they do have 100 percent renewable commitments, and have been making large-scale investments to try to meet them, and they’re driving a lot of the load growth, so they’re trying to figure out how to make that happen,” she said.
Endeavors that consume a significant amount of energy, like artificial intelligence data centers and building electrification, are also likely to drive up demand for power in the years ahead.
“We’re going to need all power generation sources to move this to meet that demand,” she said. “We need more transmission, and we need it quickly to meet these numbers that we’re seeing. So the tax credits are really important to that in terms of bringing on new generation quickly.”
In the event that U.S. policy drives a broader retreat from renewable growth, other countries are likely to step in to fill the gaps, said Jennifer Layke, the WRI’s global director for energy
“If the U.S. steps back from being a lead on either the financing, the foreign aid [or] the technology support, that leaves open a space for other countries to come in, other countries that have technological or financial or political agendas that stand to gain by being part of that clean energy transition in [the] country,” she said.
On the other side of the equation, she noted, numerous businesses, including many based in the U.S., rely heavily on international markets, which are likely to continue their expansion in renewables.
“So there’s both the [question of] how do businesses respond and there’s the [question of] how will governments respond in trying to incentivize their businesses to take that that space over,” she said. “So I can imagine … both will be dynamics that we should be watching.”
Bird acknowledged Energy Secretary Chris Wright’s history of downplaying both climate change and the robustness of the energy transition. Wright, who previously worked as CEO of one of the nation’s largest fracking companies, said years before his nomination that “there is no climate crisis and we’re not in the midst of an energy transition either.”
But she noted that despite that history, Wright has also invested in next-generation geothermal energy corporation Fervo Energy, which suggests “we could see some gains on some parts of the clean energy sector and industry on the utility side.”
Concerns about electric grid resilience are bipartisan, she noted, and “we’re going to need a lot of different solutions here, wind and solar, I think, and renewables have advantages in that they can be built quickly if you can get them interconnected. It’s a lot quicker to do wind and solar plants than it is to build a natural gas facility.”
We give you energy news and help invest in energy projects too, click here to learn more
Crude Oil, LNG, Jet Fuel price quote
ENB Top News
ENB
Energy Dashboard
ENB Podcast
ENB Substack
The post Will Trump’s second term change the future of energy? appeared first on Energy News Beat.
Energy News Beat