Shortly after the results of the US election in 2016 were announced, I had dinner with some lovely US-based clients. The conversation was particularly strained when the election results and energy policy were discussed – there may even have been some tears.
While the latest US elections may still be subject to some discussion, president-elect Joe Biden hasn’t wasted any time making his priorities clear – having already started his efforts to ramp up the efforts against COVID-19, and signalling his intention to rejoin the Paris Agreement on his first day as President.
However, rejoining the Paris Agreement is not going to be enough if federal policy doesn’t follow a similar path and support significant domestic carbon reduction.
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Biden’s transition website buildbackbetter.com layouts out the top priorities for his transition to the presidency. These are: COVID-19, economic recovery, racial inequality and climate change.
Among his climate change objectives are a move to “generate clean, American-made electricity to achieve a carbon pollution-free power sector by 2035.” There are also plans to improve energy efficiency in buildings (up to 4 million of these), increase the uptake of energy-efficient appliances and cut residential energy bills by improving insulation in homes.
Oil and gas industry
Biden’s plans for oil and gas have many worried about the implications for jobs, trade and economic impact. Yet, while Biden has already stated he will ban fracking on public land, this makes up a small portion of the total ‘frackable’ land in the US. The implications for the Keystone XL pipeline – which it is proposed will transport 830,000 barrels of oil a day from Alberta to Nebraska – are likely to be more dire as Biden has already made it clear he plans to cancel the permit issued by the Trump Administration for the project. However, those close to the project wonder whether, given the amounts that have already been sunk into the project, Biden will still proceed as indicated once he enters the Oval Office.
Policy
His policy plans – while more moderate than some proposed by other Democrats – it is said, will be the most ambitious and progressive ever enacted by the United States. Biden’s plan aims to see the US completely carbon neutral by 2050 and his $2 trillion energy plan can be read here.
Rejoining the Paris Agreement will have multiple benefits for the United States – not only in terms of it’s standing among other world powers, but also the country reasserts itself as a world leader and global partner. The Biden Administration is likely to align its policies with those already being followed by many states, cities and companies across that country. More importantly, the realignment of regulation with policy will be backed by federal stimulus and environmental policies that support, rather than hinder, their success.
This is just one of what I imagine will be many editorials examining the impact of the new administration on both national and international energy markets. There is so much to examine and shifting through the impacts is going to take time – and may be subject to some of the unfortunate political give and take Mr Biden may have to accommodate as a reality.
However, I’d be really interested to know what you think will happen as the United States transitions to a new administration. Besides rejoining the Paris Agreement, where is the Biden Administration likely to focus its energy and how do you anticipate this will impact efforts to address climate change in a meaningful way?
As always, we’d love to hear what you think. Contact us at [email protected] or visit our LinkedIn post to leave a comment.
Wishing our US readers a smooth energy and administration transition.
Until next time!
Claire
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