The bad news has been rolling in: the Trump administration will encourage fossil fuel production. But can this make economic sense? And could there any possibility for the continued growth of renewables? Ben Paulos investigates.

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The shocking election of Donald Trump has struck fear in the hearts of clean energy proponents in the United States. During the campaign, Trump repeatedly attacked renewables and vowed to roll back environmental regulations and make the coal industry great again.

But he offered few specifics. In a transition-team website launched last week the Trump campaign laid out an unapologetically pro-fossil plan.

“The Trump Administration will make America energy independent,” it declares. “Rather than continuing the current path to undermine and block America’s fossil fuel producers, the Trump Administration will encourage the production of these resources.

“We will lift the restrictions on American energy, and allow this wealth to pour into our communities. It’s all upside: more jobs, more revenues, more wealth, higher wages, and lower energy prices.”

Most reaction to his election has been extremely negative, from industry, NGOs, and liberal pundits. Stock prices tumbled for major wind and solar firms and soared for coal producers.

Trade associations have put on a brave face. In a statement, Tom Kiernan of the American Wind Energy Association, said the wind industry is “ready to work” with the new administration.

“Mr. Trump has said, ‘We can pursue all forms of energy. This includes renewable energies and the technologies of the future,’” the statement reads. “We look forward to working with him and his appointees to make sure they recognize that wind is working very well in America today as a mainstream energy source.”

But Rhone Resch, former head of the Solar Energy Industries Association, was more candid. “It’s a disaster,” he said in an interview with Bloomberg News. “We’ll need to educate Trump that solar energy is a business and not a political issue.”

But under the pall of gloom, there are some dim lights of optimism, at least for the power sector.

A report by S&P Global Platts and S&P Global Market Intelligence, released just before the election, compares the implications of Trump and Clinton administrations on the US power sector.

While Clinton’s goals, if realized, would have resulted in a vastly cleaner power mix, the study still sees growth in renewables under a Trump administration.

In detailed policy plans, Clinton called for getting one-third of US power from renewables and installing 500 million solar panels. This would drive solar from 31 GW currently to as much as 154 GW by 2020, while generating 33 percent of US power by 2027 would require roughly 506 GW of combined wind and solar, representing over a four-fold increase from current levels, according to the study.

Since the Trump campaign never developed detailed policy plans, S&P relied on statements by Trump and his advisors. They think his likely policy actions would still result in growth in renewables, largely due to what is already in the pipeline, but hitting solar much harder than wind.

“With no federal mandates or incentives to drive renewables expansion, Trump’s energy platform might appear bearish for renewables,” they write. “However, the nation would likely still see growth for these resources due to the proliferation of state-level renewable portfolio standards as well as continued technology cost declines.”

By 2020 they see wind growing by 42 GW under either president, but huge differences in solar growth, increasing by only 20 GW under a Trump regime. Renewable market share under Trump could still reach upwards of 21 percent by 2027, they say, about 8 percentage points higher than 2016 levels.

Likewise, they see coal plant retirements continuing, though at a lower level. Under Clinton, they estimate around 58 GW of coal retirements in the 2020-2027 time frame, slightly more than predicted by the US Energy Information Administration under the CPP.

“In contrast, Trump’s promise to repeal the CPP would likely keep coal and natural gas battling for generation share based on fuel economics, which would continue to ebb and flow through the years.”

They think the 14.6 GW of already announced coal retirements would happen in Trump’s first term, with an additional 18 GW from 2021 to 2027.

These predictions hinge on a few big assumptions, most notably that current tax credits for renewables are not repealed.

In 2015, Congress granted a multi-year extension of the primary federal tax incentives, the PTC and the ITC, phasing them out by 2022. This has ensured a runway for deployment, causing a boom in wind and solar construction.

Anti-renewable groups like the American Energy Alliance have been pushing Congress to repeal the tax credits. But they have seen little success, thanks to pro-renewable Republicans like Senators Chuck Grassley of Iowa and Dean Heller of Nevada. Grassley, just re-elected to his sixth term and member of the all-important Joint Committee on Taxation, said that if Trump wants to repeal renewable tax credits, “he’ll have to get a bill through Congress, and he’ll do it over my dead body.”

While the switch from Obama to Trump is a radical change, the election caused very little change to Congress. Republicans continue to control both houses, with a slimmer margin in the Senate.

That slim margin in the Senate will be the primary battleground for legislative efforts to roll back Obama-era policies.

Rules have allowed Senators to engage in unlimited debate since the beginning of the country, which enabled Senators to tie up legislation with long filibusters. In 1917, the Senate adopted a rule to allow a two-thirds vote to end filibusters, a procedure known as cloture, which was first used to force a vote on the Treaty of Versailles. A 60-day filibuster over the Civil Rights Act of 1964, led by Southern Senators, led to the threshold being lowered to 60 votes.

Republican obstruction to Obama administration appointees led to reforms of the filibuster in 2014, when Sen. Harry Reid invoked “the nuclear option.” Using a parliamentary maneuver, the Democrat majority changed the rules by a simple majority vote, rather than the two-thirds vote required to change Senate rules normally. A subsequent deal preserved filibusters for other legislation, and allows members to stage a “silent filibuster,” where they don’t need to talk endlessly or even stay on the Senate floor.

With Republicans now holding only 51 seats in the Senate, they will find it hard to break filibusters by Democrats. But with a very conservative House and President, the Senate will be the chokepoint for defending clean energy and other Obama-era policies. There may be growing pressure to change the rules of the Senate to allow the slim Republican majority to overrule Democratic opposition.

If the filibuster is weakened, Congress will be open for business. Repeal of the Clean Power Plan, relaxed rules on fossil fuel extraction, and rejection of the Paris Climate Accord, are all likely steps.

But not all observers think Trump and Congress will completely wipe out clean energy.

The ClearPath Action Fund, which put $4.8 million into an effort to elect clean-energy Republicans, claimed success, with 13 of 15 endorsed Congressional candidates winning election.

“Clean energy is good politics,” founder and funder Jay Faison said. “We knew it was a message that could move voters and we have the evidence that it worked.”

But their moderate Republicans may be lonely in the conservative-dominated Congress, as far-right factions may feel they have a mandate with the election of Trump.

Merrill Kramer, of the law firm Sullivan & Worcester, told Utility Dive that “the renewables train has left the station,” and will likely succeed even if tax credits are repealed.

“Economics as much as energy policy are driving the markets,” he elaborated. “[F]racking is not economic at current gas prices, worldwide demand for oil is down and the cost of coal retrofits is prohibitive. Conversely, the cost of solar PV panels and wind turbines continues to decline.”

Kevin Book, managing director with ClearView Energy Partners, points out that electricity markets currently suffer from too much capacity, driving down revenues for generators and pushing out uneconomic coal plants.

“CPP was the predator that was going to tighten up supply and raise prices on the grid,” he told E&E TV. “Kill the predator and you’re going to have low prices for the enduring future.”

He also pointed out that market and state political dynamics haven’t changed. “State actions have been driving renewables installations and the green energy agenda for most of the last 10 years. The emission reductions from coal-to-gas switching have happened for market reasons.

“When you get right down to it, taking away CPP only takes away a backstop to what was already happening.”

 

Bentham Paulos is an energy consultant and writer based in California. His views are his own, and don’t necessarily represent those of any of his clients.