US President Donald Trump, in his inimitable theatrical style, has fulfilled his election promises on energy and climate change.
The triumphant call in the inaugural address of “drill, baby, drill’ was followed by executive orders doing away with all the restrictions on exploration and drilling that had been put in place by outgoing President Joe Biden.
Trump has withdrawn from the Paris Agreement on climate change and cut the ongoing financial support for Electric Vehicles (EVs) as expected.
These are huge setbacks, especially when the scientific prognosis on climate change has been getting bleaker.
When the need is for immediate decisive action to accelerate the energy transition away from fossil fuels, the US, with the largest economy in the world and leadership of the West, has chosen to go back.
Trump has just started his four-year term and is unlikely to change his position.
What are the implications and consequences of his drastic decisions?
The core argument that fits into Trump’s desire to make America great again is to not deny American companies the ability to produce more oil and gas, provide cheaper energy in the domestic market, and get a larger share of the global market.
America producing less oil and gas on account of environmental restrictions results in unfriendly countries like Iran and Russia producing and selling more and making more money. Why deprive American companies of higher profits from fossil fuels and why make American consumers pay more?
These companies have been generous donors to the Trump campaign and the Republican party. Their commercial interests lie in perpetuating the fossil fuel industry and pushing real action on reducing the use of fossil fuels as much into the future as possible. In the US they have been successful in getting a President who has given them all that they wanted.
In the battle against global warming, there have been two parallel strands.
One has been to reduce the cost and to increase the supply of renewable energy, and the other to peak and then reduce the use of fossil fuels in the world.
The reluctance to impose higher costs on energy consumers has been a barrier to effective regulatory action to reduce demand for conventional fossil fuel energy. Limited fiscal space has constrained the extent to which governments could financially support the growth of renewables.
The result has been the modest success so far in controlling carbon emissions. Governments, like Germany, which have made sustained efforts have taken the share of renewables to over 40 percent of their electricity consumption.
For the next four years, at least, the US government would not be part of the global effort on climate change. But the US is a continental-sized federal country where the states have their own space to chart their course.
California, which on its own would be the world’s fifth largest economy, has set itself the goal of being among the first in the world to have vehicles on the road which do not use fossil fuels and a carbon-free electricity system. They are implementing their road map for this.
Trump’s being President is unlikely to have an impact on California’s continuing its energy transition. There are other forward-looking states and cities in the US that are likely to continue their efforts. So, even for the US, the prognosis is not as bleak as it would appear at first sight.
Notwithstanding the pre-eminence of the US, Trump’s actions are unlikely to change the course in other countries except where parties of the far right with similar views come to power. Ambition and action on climate change have fortunately been rising.
The real breakthrough in energy transition has been in the decline in the costs of renewables. Renewable power is cheaper than new electricity capacity based on fossil fuels in many countries, including India.
Here market forces will drive the transition away from fossil fuels faster.
Even in the US the market for renewables is growing especially in the states where there is wind and solar power potential.
EVs have arrived and there is hardly any major auto company in the world which is not increasing the number of models it is introducing in the market. There is greater cause for optimism on account of the efforts in the advanced industrial economies to achieve breakthroughs in the hard-to-abate sectors using green hydrogen.
Germany, Japan, Korea and China are all trying to be global leaders in the new hydrogen economy. India has also displayed unusual ambition and is trying to get to the global technology frontiers in using green hydrogen to decarbonise sectors where greenhouse emissions cannot be easily reduced.
By ignoring the need for continued leadership in new green technologies and state support for it, Trump may, instead of helping America maintain and increase its technological leadership, contribute to its relative decline in this critical sunrise sector.
As it is, there are many who feel that China has clear leadership in the production of solar panels, EVs and batteries. It is acting strategically to enhance its leadership position in every segment of green technologies of renewables, storage and green manufacturing.
Voices may emerge in the US urging Trump not to cede leadership to China by default.
The US withdrawing from the Paris Agreement is high on symbolism. In substance, it may not mean that much.
The US may well discover that its absence is not missed. The COP meetings would continue along with the efforts of all stakeholders for a consensus on greater action and pathways for getting better results.
Even under President Joe Biden, the US action on reducing carbon emissions was modest. The US has among the highest per capita emissions of around fourteen tons compared to a bit over seven tons per capita of Germany.
In terms of helping the developing nations, the US has been strong on rhetoric in urging action but has had difficulty in providing climate finance with the approval of the US Congress. Private efforts on providing climate finance have been gathering momentum and will hopefully continue.
Humanity is facing disaster if carbon emissions do not peak and begin to decline at the earliest.
Civil society activists need to engage with the supporters of Trump and the Republicans and make them realize that there is no time to lose if they want human civilization to survive.
The US is so large that until the Republicans change there is little hope of curbing climate change over the medium term.
(The author is Distinguished Fellow, The Energy and Resources Institute (TERI) in New Delhi. He is also former Secretary, Department of Industrial Policy and Promotion, Government of India. This article was originally published under Creative Commons by 360info)
