Goodbye, Renewables: How Trump’s Win Could Affect Global Clean Energy Revolution
As Donald Trump takes over the White House, significant changes could be made in the country's clean energy movement and the fight against climate change.
During the Obama administration, the United States made substantial moves to reduce carbon emissions through the Clean Power Plan (CPP), a program by the Environmental Protection Agency (EPA) obliging utilities in states to cut carbon emissions. The country's participation in the Paris Climate Agreement, which entered into force this month, is also essential in keeping the pact strong.
But Trump's victory will reshape the U.S. policy on energy and environment.
Clean Energy No More?
During his campaign, Trump openly denied climate change and called it a "Chinese hoax," while threatening to "cancel" the landmark Paris climate accord. He plans to open up federal lands to oil and gas drilling, even increase production of one of the most harmful fossil fuels in the world: coal. He plans to eliminate "unnecessary" regulations in the energy industry, mostly rules that protect streams from coal mining and waterways and wetlands.
EcoWatch reported that the U.S. Environmental Protection Agency (EPA) will be dismantled, and the new cabinet will likely be stacked with pro-business and pro-fossil fuel appointees. Moreover, Trump and the Republican government could preemptively end the 30 percent Investment Tax Credit for solar energy, which had been recently extended to 2020.
The Trump administration could also "cancel all wasteful climate change spending," saying that about $100 billion will be saved, Bloomberg BNA reports.
According to a recent study from energy analytics firm Lux Research, a Trump presidency could mean 3.4 billion tons more U.S. carbon emissions than a Clinton presidency.
The Surge of Coal
Glencore Plc., the world's top coal trader, rose over 7 percent on Wednesday, while Vestas Wind Systems A/S, the world's biggest wind-turbine maker, fell by 13 percent, Bloomberg reports. Solar companies First Solar, SunPower and SolarCity were also down by 6 percent, 17 percent and 6 percent, respectively.
"The result is undoubtedly a blow for the renewable energy industry," Matt Loffman, an analyst at energy consultant Douglas-Westwood in Houston, told Bloomberg.
"The oil and gas industry is a clear winner with the new president," Alexandre Andlauer, head of oil at research firm AlphaValue in Paris, said in the same statement.
Clean Energy Revolution Could Still Go On
According to a report by Bloomberg, Trump may not be able to stop the clean energy revolution that easily. Even without the Clean Power Plan, renewable energy capacity is still expected to grow more than 4 percent a year until 2040, according to the U.S. Energy Information Administration. About 60 gigawatts of coal-fired generating capacity will retreat by 2030, the report said.
Moreover, the absence of tax incentives may not trample renewables completely. Renewable energy could win on cost grounds, with equipment costs falling and, once installed, renewables producers will not need to pay to harness wind or solar power, Bloomberg reports. Likewise, onshore wind in the U.S. is already cost-competitive with natural gas and solar costs are decreasing.