The United States is already struggling to meet its goals to cut planet-warming emissions. Enter President-elect Donald Trump.
Come January, Trump will begin enacting an agenda that includes rolling back pollution regulations, unleashing fossil fuel development and withdrawing from international climate efforts like the Paris Agreement. That will likely mean the country falls further behind on its Paris commitment — known as a nationally determined contribution (NDC) — to cut emissions to 50 percent of 2005 levels by the end of the decade.
“The U.S. NDC was going to be a challenge under a [Kamala] Harris administration,” said Dan Klein, an emissions analyst at S&P Commodities Insights. “So it’s going to be even more challenging if it is relying on consumer behavior, state-level decisions and corporates to get the job done.”
Some of Trump’s plans will fall short. Energy markets have a way of defying presidential expectations. Trump couldn’t arrest coal’s decline in his first term, and Biden, despite his lofty climate ambitions, had to beg oil producers to drill more when gasoline prices spiked.
The American economy is also likely to get greener over the next four years. Electric vehicle sales are on pace to hit 1.5 million vehicles this year, up from 158,000 when Trump left office. Wind and solar generation are now on par with coal, and liberal states are unlikely to give up on their climate targets, analysts said.
But Trump’s victory comes at a precarious moment in America’s energy transition.
Biden invested $1.6 trillion in greening the economy during his term. His signature bill, the Inflation Reduction Act, contained hundreds of billions of dollars in tax credits intended to help companies and consumers go green.
And yet U.S. emissions have hardly budged and are expected to remain unchanged in the immediate future. In 2021, total U.S. greenhouse gas emissions were 5,418 million tons, according to EPA. The agency has yet to release official figures for the entire economy for 2023. But the Rhodium Group, an independent economic consulting firm, estimates U.S. emissions were 5,410 million tons last year. That was 18 percent lower than 2005 levels.
The U.S. Energy Information Administration expects that carbon dioxide emissions from energy, which account for three-quarters of total U.S. greenhouse gases, will be flat in 2024 and 2025.
The plateau owes in large part to a slow down in the pace of coal plant retirements. About 48 gigawatts of coal capacity retired under Trump, according to EIA data, amounting to an 18 percent reduction in the U.S coal fleet. The decline meant that emissions continued to fall even as Trump championed policies meant to boost fossil fuels.
But only 33 GW of coal capacity has closed since Biden took office — a sizable number but not large enough to offset rising emissions from other parts of the economy like industry, transportation and increased gas generation in the power sector.
“In my opinion, we’ve squeezed the coal nut almost as hard as it can be squeezed,” said Rob Jackson, a Stanford University professor who tracks global emissions. “At some point, you have to do something else, and we haven’t done enough.”
Most emission modelers think the power sector is the most likely to contribute to emission reductions this decade because technologies like wind and solar are now widely used and cheap. Most analysts think they will continue to grow under Trump. EIA forecasts that U.S. solar capacity alone will increase 80 percent by the end of 2028, with 88 GW of new projects planned across the country.
But while renewables are likely to expand, the pace of new installations could slow.
Offshore wind, which is particularly important to Northeastern states’ climate plans, is under particular threat given Trump’s well-known animosity toward the industry and the federal government’s control of the permitting process. Onshore wind development is dependent to a large degree on new transmission capacity, which is hard to permit. Solar deployment could be hampered if Trump follows through on a promise to impose higher tariffs on Chinese goods. Repeal of EPA’s power plant rule could extend the life of aging coal plants and prompt utilities to propose building a wave of new gas plants to meet rising energy demand.
But perhaps the biggest question for the power sector — and U.S. climate efforts as a whole — is how Trump will approach the IRA. Many analysts believe parts of the law will survive, despite Trump referring to it as the “green new scam” on the campaign trail. That’s because provisions benefiting nuclear, hydrogen and carbon capture and sequestration have broad bipartisan support.
Some Democrats have expressed hope Republicans will resist repeal efforts because GOP states have been the primary beneficiary of IRA-driven clean energy projects. They point to a letter signed by 18 Republican representatives opposing efforts to repeal the IRA as a reason for optimism.
But in a September panel hosted by the law firm Norton Rose Fulbright, prominent Republicans said a second Trump administration would likely target tax credits for electric vehicles and renewables to help pay for an extension of the tax cuts passed during Trump’s first term.
“I think it is false hope to assume that the number of potential investments in Republican states will act as a firewall against repeal,” said John Gimigliano, a principal at KPMG and a former Republican tax counsel on the House Ways and Means Committee. “There may be some reluctance, but remember that you are forcing Republicans to decide between raising taxes on millions of individuals, including middle-income folks, and repealing incentives for a handful of energy projects in their states or districts.”
Repealing tax credits for renewables could significantly hamper overall U.S. climate efforts. In May, the Rhodium Group estimated that two credits available to renewables and other zero-carbon producers would contribute 300-400 million tons in emission reductions by 2035, amounting to a 29-46 percent reduction in emissions compared to a scenario without the credits. When Rhodium modeled overall U.S. emissions in July, it concluded U.S. greenhouse gasses were on track to fall between 32-43 percent by 2030 if the IRA and regulations like EPA’s power plant rule regulations remain in place.
Electric vehicles will also bear watching. Electric vehicles reached 9 percent of car sales in the third quarter, a record, and are on pace to hit 1.5 million vehicles for the year, said Corey Cantor, an analyst who tracks the sector at BloombergNEF. That is around the threshold where EVs have begun to reduce oil demand in countries like Norway, he said. Chinese oil demand has also plateaued this year, in part due to robust EV sales.
Attempts to repeal credits benefiting EVs would likely slow adoption in the U.S., Cantor said.
“Subsidies reduce the upfront costs of EVs, and we know that is one of the two main inhibitors for why people don’t buy EVs,” he said, citing range anxiety as the other. “Anything that doesn’t help hurts.”
Jackson, the Stanford professor, echoed that sentiment. Electric vehicle adoption and electrification of space heating in buildings are the two most likely areas outside the power sector to contribute immediate emission reductions, he said.
“Those two sectors, cars and homes, are the two levers I expect the new administration to push back on hardest and fastest,” Jackson said.
