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What Does Trump 2.0 Portend for Energy Policy?

Every new administration in Washington, DC brings policy changes. However, the new Trump administration promises to be particularly disruptive, especially for energy policy. Let me summarize some of the anticipated changes and how likely these are to happen.

Climate change policy has been the major driver of energy policy this century as New Jersey, the United States, and much of the world seek to decarbonize the energy sector. President Donald Trump has stated many times that he does not support many of the climate change initiatives of the Biden administration. But what will the Trump administration actually do?

Advocates for decarbonization policies are alarmed at the potential for change. A recent article in Yale Environment 360 starts by saying:

The November 5 election was the worst-case outcome for climate regulation. The return of Donald Trump to the Oval Office and Republican control of the Senate and the House of Representatives will halt federal progress and lead to a reversal of most of the climate initiatives undertaken by the Biden administration.

It is anticipated that we will see changes to green energy policies, the promotion of fossil fuels (“drill baby drill”) including the elimination of the liquified natural gas (LNG) ban, permit reform and leasing of federal lands. There will surely be changes made to spending and tax incentives in the Inflation Reduction Act that could impact everything from offshore wind, battery manufacturing, electric vehicles (EV) and hydrogen production. 

EV mandates for both passenger vehicles and heavy-duty trucks, two programs already adopted by New Jersey as it seeks to implement California’s standards, may also be affected. The Trump administration may seek to rescind the federal waivers that allow California, and other states that follow, to have their own vehicle emission standards.

But, like everything in Washington, DC, nothing is as easy as it sounds. Despite the rhetoric of seeking a massive overhaul of energy policies, the Trump administration has many impediments to overcome. 

There are slim GOP majorities in both houses of Congress, which will make enacting comprehensive changes difficult. The filibuster rules in the Senate require 60 votes for most actions, except for the limited budget reconciliation process. Entrenched federal agencies are also difficult to turn around, especially if they object to the results of the policy change. And when it comes to limiting spending, the administration will find that there is a constituency behind every dollar.

Yes, change will certainly come, but how much will depend on leadership and focus, as well as having good lawyers.

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