As Americans prepare to go to the polls today to vote for either Donald Trump or Joe Biden as president of the United States, I wanted to reflect on what the election results could mean for energy policy in the US.
In the United States, the discourse has become polarising, pitting climate change deniers against believers, fossil fuels against renewables. The outcomes of today’s voting will determine America’s official energy policy for the next four years.
In August this year, Forbes featured the article Biden vs. Trump: The Battle Over American Energy Policy And Its Consequences which provided some interesting points about a potential Biden win. Written by Tilak Doshi, an economist, the article highlights:
“Mr Biden, if elected, would be bound to undo most if not all of President Trump’s initiatives in energy and environmental affairs. As promised, he would take executive and regulatory actions aimed at ending fracking and oil and gas drilling activity in federal lands.
“In his plan to “secure environmental justice and equitable economic opportunity in a clean energy future”, Biden committed to immediately re-join the Paris Agreement if elected president. This could potentially open up the US government to yet another avenue of judicial intervention by its own law courts.” Doshi cites the example of Heathrow’s expansion plans being rejected by the Appeal Court due to Paris Agreement targets – despite being government approved.
These are, of course, valid points, and any major intervention or reversal of policy is likely to have far-reaching implications. Biden’s energy plans could be transformational (in more ways than one) but will take time to implement and the effects are likely to be felt only toward the end of his first term.
What is likely to happen if Donald Trump wins a second term as president?
He will likely continue to push his ‘American energy independence/dominance’ agenda, with continued support for the oil and gas industries in the US. He will also finalise the US withdrawal from the Paris Agreement and continue to cast doubt on the validity of climate change.
What does it mean for energy policy in the US?
While there will be more formal support of the local oil and gas markets, in many ways I believe that states will continue to drive their own climate-sensitive policies, similar to the way they have done over the past four years. Companies, cities and states will continue to commit to net-zero targets, although this progress will be slower than if it were backed by federal mandate or financing.
Interestingly, the Citi Group’s Asian office believes that a shift too far to the left could have a detrimental effect on GDP, saying that eliminating fossil fuel use and production could be “highly disruptive to the economy and individual sectors over the short- and long-run. Even a 15-year adoption period points to a stint of negative GDP growth and a challenging transition.”
In reality, we can speculate all we like. We will, however, see how this all plays out in the coming days, months and years. The first milestone will be when the official results are announced – likely to be at the end of this week or even early next week.
How do you believe the elections will go? What are your thoughts on energy policy in the US under a Trump or Biden administration? Do you think the US elections matter? How will the outcome influence your business?
Until next time!
From the Twittersphere:
Sleepy Joe Biden has vowed to ABOLISH the American oil and natural gas industries, and BAN fracking. Biden’s energy ban will send every state into crushing poverty, from Michigan, to Wisconsin to Arizona to Pennsylvania. https://t.co/gsFSghkmdM— Donald J. Trump (@realDonaldTrump) November 3, 2020
Climate change isn’t a hoax –– it’s a threat to millions of Americans like Velma and Amirah.— Joe Biden (@JoeBiden) November 2, 2020
We have to vote out Donald Trump tomorrow and take urgent action to combat this crisis. pic.twitter.com/Lg9fvFlVg9
When Donald Trump thinks about climate change, he thinks “hoax.”— Joe Biden (@JoeBiden) November 2, 2020
I think “jobs.”
We can solve our climate crisis and our economic crisis at the same time. Here’s how: https://t.co/AKl9jZKB0s