The Transition: Climate Progress Under Trump?

This transcript is from a CSIS podcast published on December 18, 2024. Listen to the podcast here.

Quill Robinson: Welcome to Energy 360: The Transition a CSIS miniseries, exploring the energy implications of the 2024 election. I'm your host, Quill Robinson. Despite climate advocates concerns, could President Trump and his incoming administration's policies reduce greenhouse gas emissions? How much control does the president actually have over U.S. emissions? This week, Joseph and I discuss opportunities for climate progress under the Trump administration with two top experts. Robin Milliken is Head of Strategic Initiatives and Integration at Breakthrough Energy. Robin has over 15 years of experience in energy, science, and technology policy, including as a senior strategy consultant at Booz Allen Hamilton and as a legislative aide in the U.S. Senate. Lisa Friedman is a climate change reporter on the New York Times Climate Desk. Previously, Lisa was Washington Bureau Chief of the Oakland Tribune and the Los Angeles Daily News. Let's dive in. Robin, a lot has been made of the impact of the U.S. President on greenhouse gas emissions and climate change, but I'm curious about how much control the U.S. president actually has over emissions. For example, emissions from fossil fuels declined by 1% under George Bush, 1.5% under President Obama, and declined to 3% under President Trump and have risen by 1.5% under President Biden. There's no dial in the White House that says carbon dioxide emissions on it. So, as we are entering into this new year, this new administration, how should we think about the President's actual control over the trajectory of greenhouse gas emissions?

Robin Milliken: Thanks, Quill. That's a great place to start. A hot take I have on this topic is we, I think ascribe too much credit and blame to any one presidential administration, be it on energy policy or even the economy because a lot of these things are lagging indicators. The effects of policy don't often manifest for years. And even beyond that, I think what we've observed is that emissions trends over the last 20 years have really been much more driven by broader macro-economic trends and the price of oil and gas and the advancement of technology like fracking than any one energy policy. If you look at what happened under President Obama, for example, emissions declined in the power sector substantially because of the advent of fracking and natural gas displacing coal that was not a dictate from on high. It was just a thing that was happening in the market.

And if you look at what happened under President Trump, we did see, as you mentioned, a reduction in emissions. But that was largely because we had the COVID-19 pandemic, and we had depressed demand. And then under President Biden, we've seen emissions rebound somewhat, but the driver of that has been demand recovery, right? We are now driving more, flying more than we were under the pandemic. We're using more natural gas and there's been some recovery in industrial activity. So, to summarize all of that, I think we place too much importance on the role of the executive. It will be interesting to see though what the long-term impacts of the Inflation Reduction Act are. That might be the exception to all of this, where it's the first serious energy policy that we've had arguably since the Energy Policy Act of 2005, which created the RFS, the Renewable Fuel Standard. That will be something to watch.

Joseph Majkut: But surely it matters, right? I mean, we have a very sophisticated group of policy thinkers, advocates focused on climate change who are a little perturbed by the election result this year. And moreover, if you think about very, very ambitious goals for emissions reduction, say net zero by mid-century, the idea that you sort of let the market take over for a few years and you don't have to provide constant political pressure is met with a lot of protests. And so when you are thinking from the Breakthrough Energy perspective and the numerous goals that you all have, how do you see this new political terrain being one which is malleable? Not if climate is not the explicit goal of this administration, but that low carbon technologies can help meet the goals of the incoming administration. Is that the right way to think about the next few years?

Robin Milliken: I think so. I think the way we look at the landscape is of course policy is important, right? As you think about CO2 as an externality, the way that you can internalize it, right is through policy that either makes dirty energy more expensive or clean energy cheaper. And we have embarked on a grand experiment through the passage of the infrastructure bill and the Inflation Reduction Act to do the latter, right? Make clean energy cheaper. I have my fingers crossed that will happen. But we are, as you mentioned, Joseph, entering a new political landscape, right? Where there will be modifications to policy likely to happen in the incoming congress and administration, and we know that where the electorate is at and where the average American is at is not focused on climate as an objective. We saw in the election that pocketbook issues really are front of mind for everyone and we need to adapt and meet the moment there. So, what I think is likely to happen is, or what I hope happens is that we start talking about the energy and climate agenda in terms of things that align with what we're likely to see out of the Trump administration. So, focus on energy security, energy resilience, even some of the trade policies that they're proposing. I think we can very much make climate if not a centerpiece of those things because we know that will not be the primary focus of the Trump administration. We can achieve progress on it as a co-benefit, and I think we should be embracing that opportunity.

Quill Robinson: Lisa, you've followed the ebbs and flows of President's approaches to climate change in recent years. Could you talk a bit about this relationship? I think Robin talked about sort of macro forces and then policy forces. How would you characterize this relationship?

Lisa Friedman: Sure, and thanks so much for having me. Agree with everything that was said. Obviously, there are so many factors that go into whether country's emissions rise or fall. At the same time, there is no question that having someone leading the United States who says that climate change is a hoax is an impediment to action, a lot of things will depend on what happens to our emissions, but I don't really see how you can separate federal policy from this question of where our trajectory goes. The states can't do it alone, right? I mean, if you don't focus on the President and the administration, well, where's the focus? The states perhaps, and those states will become certainly more important over the next four years for those states that are led by governors who care about climate change. But whether those states' actions can add up to enough emissions reductions to keep the U.S. to its stated goal is unlikely.

Joseph Majkut: So, I have a question about that, Lisa, and I think, Robin, you probably have some perspective to share here as well. The idea that policy efforts shifts to the states was something we saw a lot of during the first Trump administration, but the policy environment was very different at that time, right? A lot of states then passed bills that would accelerate clean energy. Governors were visiting international climate conferences saying, hey, we're still in this trying to represent the other half of America, so to say. Is there really much policy room left in the states when we are thinking about largely blue states that already have pretty ambitious goals for climate and energy for renewables, what does that agenda actually look like in the coming years? Lisa, from your reporting, or Robin, from your perspective in the nonprofit world?

Robin Milliken: It's a great question. I think as I think about the future opportunities at the state level, what comes readily to mind is more strategic and thoughtful planning around generation resources and more cooperative planning on infrastructure, right? Places like Texas, my home state are starting to really lean into nuclear, for example, and they're putting in place incentives to entice operators to come to the state, build new projects. I think that accrues to the benefit of both energy resilience and meeting the load growth challenge rate, but also is a good news story for climate. And there's opportunity for states to plan together as we look at infrastructure, be it pipelines or transmission lines where we know there's a patchwork of authorities and the Federal Energy Regulatory Commission has tried to move things in the direction of greater regional planning, but if we do see a curtailment of federal authorities there through some of the recent actions coming out of the Supreme Court and other courts of jurisdiction, we will have to go back to the states and have a conversation about what they can do cooperatively together. So that's one thing that comes readily to mind, but it's a great question.

Joseph Majkut: What do you think, Lisa?

Lisa Friedman: I think it's 25 states and the District of Columbia have requirements for renewable or clean electricity, and some of those states are now Republican led. I think the question of whether some of those efforts will be strengthened under the Trump administration is really an open question. The states is where we've seen this movie before, as you alluded to, the states are where the energy is going to be, the calls for action, they're going to be the ones telling the international community that we are still in. And that does matter because the next question is what does it mean for the United States to abandon leadership internationally? Can states again convince global partners that the United States has not completely turned its back or is at best an untrustworthy partner in the effort to tackle climate change. Really, to me, these are all lines of reporting that we're going to be following in the next four years.

Quill Robinson: Joseph, I want to pick up on this international piece here. Obviously we're not going to have John Kerry flying around the world establishing deals with partners, and the incoming Trump administration has said quite clearly they'll be pulling out of Paris and they will potentially pull out of the UNFCCC as well. So there will be less of a strong U.S. role in international climate negotiations, but I'm also interested in looking at the dynamics that have changed and now exist when it comes to climate change and global political economy. Danny Roderick wrote a really interesting piece a couple of months ago, and I want to read a quote here. He said “It may be impossible to simultaneously combat climate change, boost the middle class and advanced economies, and reduce global poverty under current policy trajectories. Any combination of two goals appears to come at the expense of the third.” True? False?

Joseph Majkut: It's a very cheery message in front of the holidays there Quill. The Roderick essay, I think, is really interesting. The framework he establishes helps kind of put in context a lot of the changing rhetoric we're seeing around energy and climate here in Washington. The idea that we have over-indexed, and by we I mean the sort of general policy and thought leadership community have over-indexed on climate and under-indexed on energy access and poverty alleviation and development is something, frankly, we hear a lot of that from CSIS. We talk to visiting dignitaries from around the world, particularly emerging markets, and this is something that you hear. And then when the climate conversation comes up, all these folks are coming from countries that are part of the Paris Climate Agreement, that immediately leads you to this climate finance debate, which appears very, very hard to resolve, which is countries are happy to act on climate change, but they need financial support to do it. And I think that is part of what Roderick is talking about, that it's just it's hard to meet economic development needs and be investing in technology. I mean, look at the Biden administration spent oodles and oodles of money to deploy clean energy here in the United States. Only the United States has the fiscal capacity to do that. Maybe some of the European countries can do that. Otherwise, countries are really weighing trade-offs. The second piece of the essay, I think this is equally important, is the idea that you can protect the middle class and developed countries while meeting these other goals is a challenging one. And that actually is a fundamental critique of the strategy that the Biden administration was trying to take on climate, where we're going to bring all these jobs here into the United States. We are going to manufacture things here that really disturbs the model of economic development that we've had over the last few decades in terms of being able to develop emerging economies as export oriented economies, accessing developed markets, whether or not it's true or false, it presents a really interesting framework for the kinds of challenges we face. And I suspect that we're going to see in the new administration a reorientation of priorities. It's pretty clear that they'll be very fossil fuel positive. I don't think that's exclusively just like political favoritism. I think there is an underlying idea that we want to see economic development around the world.

Quill Robinson: Does that have to do with comparative advantage or what we have done traditionally? Why is that?

Joseph Majkut: I think it's actually, it's maybe comparative advantage. It's also commercial logic, right? You can build this stuff and you can finance it. It doesn't require a bunch of government support. At least that's the view. Whether that's entirely true to the conditions on the ground I think is up for debate. A lot of the energy access story that we're seeing growing around the world is that renewables provide a really easy, cheap way to access energy. Are they as reliable as fossil fuel baseline power? Maybe not. But if you have zero energy, you'd much rather have a cheap energy for six hours than have none for 24. And so I suspect as we look at those shifting priorities, the technology innovation that we have seen, the changing price structures for different energy sources, we've seen we'll continue to see progress, but I think Roderick's essay provides a really nice framework to think about. Our global challenges also raises critiques about things like border adjustments, which are seen in the developing world as protectionist policy and deeply unfair when it comes to climate change, even if from a policy standpoint, they're very attractive both for emissions reductions and political goals in the developed world.

Quill Robinson: Robin, you were really in the thick of these different technologies and it's something that you would breakthrough spend a lot of time working on. We often hear this narrative about, well, at the top level, we often hear this narrative of renewables are now cheaper than fossil fuels. Why wouldn't we just simply embrace these technologies? But the story is more complicated. How can we add some nuance to the benefits and drawbacks of the different technologies that exist are coming into existence and may exist in the future?

Robin Milliken: In terms of what we focus on at Breakthrough, it's really two things. So we focus on emerging technologies, what's not yet at commercial scale yet, and we think the rationale there is even in the best case, if you assume that we get to 70 to 80% renewables penetration, which is sort of the upper theoretical limit of being able to use renewables on a grid that still is functional in the way it operates today, even if you assume that that's possible, you still have 20 to 30% that you have to supply with what we refer to as clean firm technology. So it's things like long duration energy storage to firm up renewables. It's things like nuclear, geothermal falls into that bucket, and those are all solutions that give or take are not yet at commercial scale yet. Nuclear, obviously, we have light water reactors that are in operation, but gen four advanced nuclear reactors that are more safe, fault tolerant, et cetera, are not yet there.

So you're talking about 20 to 30% need plus a grid that is going to grow substantially. As we think about electrifying all of these new end uses, so cars, industry buildings, we're going to need a grid that is two to three times bigger. So we're talking about 20 to 30% times two to three. So that's a lot of clean firm power. So that's one area where we think new policy is needed to usher those technologies in. That's the first bucket. And then the second bucket is enabling infrastructure. So what is all the connective infrastructure we need to make generation technologies functional, for example, in the power sector. So it's things like pipelines, transmission lines, so that's another area of focus for us. Some of the key challenges with all of this are I think what we're encountering is obviously it's very difficult to build greenfield projects. That has certainly been a challenge for renewable energy, and we're seeing an increase in moratoria and setback requirements at the state level that are making it extremely challenging to build grid scale renewables. And then we also have workforce challenges. We don't necessarily have the people that are trained at the either high skill PhD science level or even the mid-skill level to build these types of projects. So looking at all those constraints which are unknown and unknowable, we think a portfolio approach is the right way to go, where if you have challenges with one pathway, you can pull another lever and pursue a different strategy. So that's really how we think about things is portfolio of emerging technologies and then connective infrastructure is kind of the two key needs.

Joseph Majkut: As we think about the last few years. The DOE has played an incredibly important role managing the portfolio of energy innovation in the United States, right? A lot of people misunderstand. The DOE is not an energy regulatory agency in any particularly meaningful way. It's a science and technology agency. Lisa, you wrote a piece on Chris Wright, the designee to run the Department of Energy. What did you learn in that piece in reporting what his perspective and what his priorities may be running that agency?

Lisa Friedman: Well, listening back to his videos, but also he's been on, it's a podcast world. He's been on many, many podcasts talking about his worldview, which is that fossil fuels, I mean, I can't speak to his worldview, but it seems to be that fossil fuels are a force for good. It echoes things we've heard in the Alex Epstein book, A Moral Case for Fossil Fuels. It sort of belongs in sort of a rare sphere of political arguments that you honestly don't hear from industry that much. I spoke to one host who interviewed Chris Wright, who is in the, speaks with folks in the oil and gas industry who felt like the industry has become very defensive on climate change, and he really appreciated Chris Wright being sort of out there with what he called an intellectual argument that fossil fuels can eradicate poverty. I think it's also important to note that most scientists I spoke to who looked through his comments said that while he acknowledges that climate change is happening, cherry picks data and erroneously says things like climate change has not made storms more frequent or intense. None of those things are accurate. The science is increasingly showing that the consequences of climate change are happening now, the academic world around the economic consequences of climate change is a place that really just hasn't done a lot of work yet, but we know that not addressing climate change will have a big financial impact. Even as we're talking about this tension between cutting emissions and eradicating poverty. You have to add into the equation what is the impact on the ability to eradicate poverty if climate change is not dealt with?

Joseph Majkut: Yeah, I've always felt that this is why the Roderick piece obviously such an interesting framework. If you select two of those things, you can get yourself into a corner where you're end up dismissing one of the others. I do think, and as you know Lisa, I've spent a lot of my time blogging about the nature of climate risks and trying to figure out how do we make the economic case for intervention. I do wonder how much does that outlook matter? The Department of Energy is going to carry out a big research program articulating stuff that was set by the bipartisan infrastructure law, by the Energy Policy Act of 2020. And so if we kind of think again about what are the core fundamental things we're trying to do here, tech innovation to reduce the cost of energy promoting U.S. exports, if further geopolitical benefits perhaps over their climate ones, should those exist, Robin, how should we think about that agenda over the next few years? Where do you see potential momentum on the front of technology innovation?

Robin Milliken: Obviously, hard to say without having a crystal ball. What's of the folks like Chris Wright, Doug Burgum, who will be really ushering in the next phase of national energy policy, but if the last Trump administration experience was instructive, I think there are some things that will resonate with their agenda. We did see a big focus on innovation. As you mentioned, we passed the Energy Act of 2020, which really paved the way for the infrastructure bill by creating new authorizations, new programs focused on everything from clean industrial technologies to having more of an emphasis on advanced nuclear, so strong precedent there for seeding the pipeline of innovation. I think one of the things that is a little bit tricky is the way that some Republicans talk about innovation is it's very narrowly focused on research and development, or even more extremely or strictly focused on basic science. And our perspective is innovation is really the entire process of speeding a technology to market. So you do need research and development to reduce technology risk, but then you need incentives to reduce commercial risk such as tax credits, and then you need funding to de-risk the, for example, capital expenditures of first projects and all of that counts as innovation. So it'll be interesting to watch how they define and think about innovation, but I think what is likely to manifest is a continued focus on that early stage basic science, and then maybe even some applied r and d. I think they probably will pick and choose the things that most align with their agenda. So solid support for carbon capture technologies, nuclear, things like that, TBD on the other things that sort of aren't as kosher.

Joseph Majkut: These are also places where the U.S. has a strong comparative advantage on either our firms are doing that activity. We're at the technological frontier. If you take an analytical critique of the strategy we've had so far, we're playing catch up on manufacturing, whether it's lithium ion batteries or solar panels, things we're way behind China on. There are plenty of security reasons why policymakers may want to do that, but it's not economic competition policy. Maybe.

Robin Milliken: I agree with that. I think one of the difficult lessons learned from the experience of the Inflation Reduction Act is it is really difficult to have our cake and eat it too, right? We say we - or two of the stated objectives of that policy, were promoting domestic competitiveness, but also addressing climate change. We saw through the experience of things with like solar PV, it's really hard when China has such an overwhelming advantage in the PV manufacturing space because they've subsidized that sector at a loss for so long, for geostrategic reasons. It's also a dirt cheap commodity product, right? So I think it begs the question, do we even want to compete in that sector? But the message we were putting out was we'll create all these jobs. We'll have this really vibrant solar manufacturing industry. On the flip side, I think what we saw is that through application of things like tariffs, the anti-circumvention tariffs that the Biden administration put on a handful of countries for geostrategic reasons, is that that actually was arguably not a good thing for climate, right? Because it really hurt solar developers in the United States in terms of their ability to quickly deploy projects. So we are going to be constantly wrestling with all of these competing priorities. But going back to your question, Joseph, I do think that it is a really big gap in the U.S. strategy as we think about how do we compete more on the manufacturing and supply chain end of the spectrum. We're really good at innovation, we're really good at cranking stuff out, but we're not good at figuring out where we can have that comparative advantage and leaning into it.

Joseph Majkut: And in this period particularly, how do we distill our efforts if effectiveness and efficiency are going to be the order of the day.

Quill Robinson: Lisa, an area where the U.S. does have an advantage is even dominant is natural gas production and LNG exports. As of this recording, we are waiting on the report from the Department of Energy. Could you tell us a bit about the story of LNG over the last few years, why this report from DOE is important and how you see LNG exports being part of the incoming Trump administration's strategy over the next few years?

Lisa Friedman: This will be out by the time your podcast is out, but as you said, we're waiting for a study of the economic national security and climate effects of approving new natural gas export terminals beyond ones that have already been approved, and this is something that President Biden ordered in January when he said that he was going to put a pause on issuing new permits for gas export facilities until the completion of this study. There was since a judge's ruling that blocked the pause, but industry has accused the administration of slow walking approvals. I think there has been one that is background to what has been an incredible rise in the export of U.S. natural gas. We were reported on a letter that we obtained a letter that Secretary Jennifer Granholm wrote that will accompany the report that's coming out. We'll see the difference in the spin between how Secretary Granholm has cast the report and what she has found as the takeaways and what we'll see in what we're all told is a very sort of technical study, but she did note that U.S. exports have tripled over the last five years and they're expected to double by 20 and could double again based just on the new terminals that have already been approved and planned. And so the question that this report will help answer, although we are all told this does not offer policy conclusions, just information and modeling of scenarios so that policymakers can make their judgements but will lay out the extent to which those additional exports displace coal or do they displace renewables. We're told based on this letter that the report is going to find that in many cases, LNG in the future is not expected to displace coal as much as it will displace renewables. The impact that it'll have on domestic prices at home one can quibble over whether raising increasing average household costs by more than a hundred dollars a year by 2050 is a lot or a little, and also looking at where the markets are expected to be. Interestingly, according to the Grandholm letter, the biggest market for U.S. LNG pretty soon is going to be China.

Joseph Majkut: Thank you, Lisa, and very much appreciate your reporting on that. As you said, we'll, all by the time this podcast is released, we'll all be pouring over that hotly anticipated report. I do think it's important to get your perspective on what that report means for the Trump administration in practice. Just even briefly, is this kind of the last gasp of the Biden agenda on LNG or is it materially important?

Lisa Friedman: Yeah, in some ways, absolutely, and Secretary Granholm even ends her letter indicating that future decisions are going to be decisions about the future of additional U.S. exports are going to be up to future administrations. This is a draft report. This letter is her take on the report. There is no doubt that a new secretary will file that away and write his own take on the final report, which will come out after a public comment period.

Joseph Majkut: It's obvious to anticipate that the incoming administration will be much more supportive of LNG exports on the commercial logic, maybe on some of this, on their preferences around energy access and poverty. To the extent that that's a real story

Lisa Friedman: Among the slew of executive orders, first day, first week will be officially eliminating the pause. Even though that will be effectively done because of this report by the Biden administration, it will end the pause, but no doubt we are going to see a completely different tenor. Just going back to my piece about Chris Wright, I mean, we are looking at an energy secretary and also a member of a new White House Energy Council who feel very strongly that increased American exports of fossil fuels overseas are a good thing for the rest of the world.

Joseph Majkut: There is a commercial logic to that. Just if I may move us toward close as there's a couple free radicals that came up in the conversation that I want to make sure I highlight one on the question of state policy. There is a brilliant paper published in 2021 by Wei Peng, Gokul Iyer, and others to Achieve deep Cuts in U.S. emissions. State driven policy is only slightly more expensive than National Uniform Policy. For those people who are thinking about what the contours of state policy are going to be over the next few years, highly recommend that you check out that paper because it makes some very interesting observations. The second is that CSIS has done a ton of work on the LNG debate in the United States. What should the role of exports be as we mature as an energy exporter? The different facets of that conversation, the climate issues, the economic issues, the strategic issues are all part of the US playing a bigger role in global energy, and one of the things I'm watching in the next administration is the extent to which the investments we make in low carbon technology are going to allow us to diversify that strength. I can totally understand why an administration wants to seek exports, both for the economic benefits for the United States and for the geopolitical context that they create. As we look at a broader energy transition and the diversification of the energy system toward low carbon technologies, which as we agree, no President really controls the question, I think facing all of us in the incoming administration is how do we want to set priorities so we're not just dominating the old, but we create real opportunities in the new? And I think that that's going to be one of the most important areas to watch for pragmatic and practical policymaking over the next few years. Wanted to wish everybody happy holidays to our listeners as well and thank you both for joining us today.

Quill Robinson: Thanks so much for joining us on the transition. We'll see you next episode.

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