Keeping an Eye on the Energy and Climate Ball

A debate is underway in the Trump Administration regarding the future of the Paris Agreement on Climate Change. According to news reports, one side advocates an immediate US withdrawal from the agreement. On the other side are those concerned that withdrawal would have adverse effects on US relationships around the world. History suggests that this latter group is correct. Pulling out of the Paris accord would be a similar to what occurred 16 years ago, when the Bush Administration abruptly exited the Kyoto Protocol without suggesting any path forward.

Much of the current debate on Paris focuses on the legal actions that the Administration would need to take to extricate the US from the agreement. This is a distraction. Few, if any, expect the Trump Administration to move forward on climate policy and/or to implement a 21st century energy strategy. However, it does not need to withdraw from Paris to signal its position on the treaty. In fact, taking a public stand to leave the agreement would be counterproductive. It would create a firestorm abroad and make many moderate voters unhappy, while pleasing relatively small constituencies at home. The Administration can satisfy its supporters by formally staying in the agreement while not taking the actions to implement it. In the end, this is the likely path forward.

There is an alternative the Trump Administration should consider. It could advance US national security interests and its economic and energy agenda by using some attractive features of the Paris Agreement. These include bringing China and India to the table, providing for each country to develop its own emissions target and strategy to achieve it, and measuring the global communities’ progress throughout the 21st century to mitigate dangerous climate change. Arguably, the Agreement’s most attractive feature is that is provides the private sector with a clear policy framework on climate change for the next several decades -- a fatal flaw of the Kyoto Protocol. With this policy certainty, US businesses will be able to develop the technologies necessary to participate in the enormous global markets for clean energy and to understand the changes they will need to make to improve their environmental performance.

Unfortunately, it seems unlikely that the Trump Administration will follow this course. Instead it will turn a blind eye toward the Paris Agreement and do little to support the actions and policies necessary to develop and deploy the energy technologies required to create a 21st century infrastructure to support economic growth, create jobs, strengthen national security and reduce pollution.

The Trump Administration has sent a clear signal on its approach to energy and the environment by stating its intent to undo two significant clean-air rules. At the auto industry’s request, the Administration will revisit requirements to improve future vehicles’ fuel and environmental performance. This request is in spite of the nearly $80 billion provided by taxpayers to US automakers during the great recession. These rules which were the result of negotiations between the Obama Administration and the industry would achieve significant economic, energy, and environmental benefits. It is important to remember that the auto industry’s performance did not benefit when policy-makers protected it from requirements to manufacture more fuel-efficient vehicles. It appears we will make the same mistake again.

The Trump Administration also appears poised to dismantle the clean power plan. The effect of this will be to increase the power sector’s uncertainty with respect to the direction of future policy, making its planning and investment decisions more difficult. This action will not achieve President Trump’s goal of increasing coal-industry jobs. The low cost of natural gas and the need to comply with the Clean Air Act will continue to limit the use of coal in the power sector. The result of loosening auto efficiency standards and scrapping the clean power plan will be to increase emissions from the two largest-emitting sectors of the US economy.

The Trump Administration can achieve its objectives of modernizing US infrastructure, strengthening national security, creating jobs, and producing more energy at home. But it needs to be more creative than simply reversing the prior Administration’s policies. It should put policies in place that expand the use of renewable and energy efficient technologies, maintain our existing fleet of nuclear reactors while developing the next generation of reactors, and enable the use of our abundant domestic coal resources. Success will require a mix of policies that reduce the cost of these technologies and create the market conditions to deploy them. The widespread deployment of energy technologies in the economy only occurs through consistent, sustained and creative public policies, not proclamations and wishful thinking.

Richard Rosenzweig is the author of the recently published book, Global Climate Change Policy and Carbon Markets: Transition To A New Era. He is also an Adjunct Professor, American University, Senior Associate at the Partnership for Global Security, and member of the Global Nexus Initiative working group.

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