February 18, 2017
Renewable-energy investments are on the rise as greenhouse gas emissions go down and the economy grows. And there’s not much the Trump administration can do to derail that, energy experts said.
Emissions declined by more than 2 percent in 2015, according to the Environmental Protection Agency’s draft greenhouse gas emissions inventory. They’re down by almost 5 percent from 2010, while the post-recession economy has expanded by more than 10 percent during that time.
The EPA data show that the decoupling of greenhouse gas emissions from economic expansion is largely the result of a shift away from coal fuels toward renewables and natural gas. And there’s no sign that political upheaval at the federal level will change this, industry insiders say.
“I’m not aware of any utility executive who woke up the day after Election Day and said, ‘We’re going to look at coal now,” Jonathan Weisgall, head of government relations at Berkshire Hathaway Energy, said. “We’re moving along the decarbonization path.”
Weisgall spoke at a utility industry conference in Washington this week along with Swami Venkataraman, a vice president at Moody’s Investors Service who specializes in energy.
Venkataraman said Republican efforts to repeal the Obama administration’s signature climate regulations will likely have no effect on emissions-reduction trends in the energy industry. After all, he said, the industry’s progress thus far has come before many of the Obama-era rules on the power sector have gone into effect.
Total emissions from the electric power industry shrunk by more than 20 percent between 2005 and 2015, according to the EPA’s emissions inventory. Venkataraman said this was the result of market forces, such as the plunging cost of renewable energy and the country’s now-plentiful supply of natural gas, which has lower greenhouse gas emissions than coal.
“The economics of renewables are driving behavior,” he said.
There’s almost no unilateral action the Trump administration can take that would impede the shift to renewable energy, according to Ethan Zindler, an analyst with Bloomberg New Energy Finance. Bloomberg BNA and BNEF are both wholly-owned subsidiaries of Bloomberg L.P.
The most significant federal policy toward renewables, a pair of tax credits for production and investment, would require an act of Congress to repeal, Zindler told Bloomberg BNA. And he said doing that would be a very heavy lift politically, because the wind and solar industries have become major economic players across the country—especially in western and Midwestern areas that typically vote Republican.
While the decarbonization of the energy industry may now be unstoppable, Zindler said the Trump administration could still take some actions that would halt or reverse the downward trend in overall greenhouse gas emissions. Specifically, he said, it could relax federal fuel-efficiency standards for cars and trucks, something that would not require congressional action.
But even if Trump doesn’t do this—and even if his policies, in aggregate, don’t change the country’s downward trajectory on overall emissions—the problem of climate change won’t fix itself, according to Michael Burger, executive director of the University of Columbia’s Sabin Center for Climate Change Law.
That’s because, to avoid the worst impacts and to meet international climate agreements, the U.S. likely needs to achieve a negative-emissions scenario, one in which more gases are absorbed by plants than are emitted into the atmosphere, Burger said. As a result, he said, federal intervention, not just inaction, is needed.
“It’s possible the market will work all this out ... [but] to make the bend in the curve that’s really necessary, there needs to be radical transformation in how energy is supplied,” Burger told Bloomberg BNA. “If there’s no federal policy, it’s hard to see that happening.”
To contact the reporter on this story: David Schultz in Washington at dSchultz@bna.com
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