Potential for Market Uncertainty in Clean Energy

Potential for Market Uncertainty in Clean Energy

By Sara Ellen Mahoney, Staff Contributor

The Trump Administration has continued their policy shift from the Obama era regulations to promoting coal and fossil fuel, while implementing laws that slow down alternative renewable energy source initiatives. The newest push is to request Congress for deep budget cuts to the Energy Department in 2019 fiscal year.[1] The administration seeks to cut the Department of Energy programs on renewable and efficient energy by seventy-two percent, as expressed in the latest draft of the anticipated budget for 2019.[2] Based on the proposed budget, the administration is asking for $575.5 million in spending for the Energy Department Office of Energy Efficiency and Renewable Energy.[3] The current spending budget for the past fiscal year in 2017 was four times as much, around $2.04 billion.[4]

Cuts in the Energy Department’s budget have become a growing trend for the administration. Last year, a similar draft was proposed, budgeting the spending for 2018 at $636.1 million.[5] The President may present a plan for the budget; however, Congress has the spending power to allocate the funds.[6] Budget allocation did not go according to the administration’s plan, as Congress rejected the implementation of the proposal and supported higher spending amounts in the Energy Department budget.[7] By asking an even lower spending budget for the Energy Department office this year, the same situation may repeat itself as the administration continues to cut funds.[8] Though the budget numbers for this fiscal year is subject to change, the cuts to research and programs with a focus on renewable and efficient energy sources is of grave concern.[9]

President Trump has shown immense support for the coal industry, promising to focus on fossil fuels to create jobs for American workers.[10] The cuts in the budget is suggestive of an executive attempt to defund the Energy Department Office of Energy and Renewable Energy, eventually shutting it down.[11] The administration’s actions suggest a political move to ensure continued security of the coal industry, one the president exclaimed continual support for American workers on the campaign trail.[12] Trump has vowed to “[end] intrusive EPA regulations that kill jobs, hurt family farmers and ranchers, and raise the price of energy so quickly and so substantially.”[13] In his State of the Union address, Trump even referenced the priority of “beautiful clean coal” over other energy sources.[14] He has rolled back the Clean Power Plan to place restrictions on EPA authority and give U.S. companies more flexibility, promoting independence and economic growth.[15] Additionally, the President has cut climate change programs and has put in place high tariffs on imported solar panels; all to keep jobs of the American worker stable.[16]

Surprisingly, these reform efforts will likely not be enough to help the coal industry. Though the Trump’s reforms will certainly slow down the growth of renewable energy, coal production is predicted to continue to fall.[17] With the President’s efforts focused on the coal and fossil fuel industries, he is losing sight of the renewable sources of power to create new growth in the U.S. economy.[18] Today, the coal and fossil fuel industry employs the most workers, but employment is predicted to sharply decline 2% in the next 12 months; while alternative renewable energy sources are on the rise.[19] As the economic climate and actual climate all begin to turn towards alternative energy sources, the job loss will certainly occur in the coal and fossil fuel industries.[20] Trump’s moves to stabilize the economy for these workers is admirable and could hold up the falling wall in the short term.[21] However, in the long term to deal with this inevitable loss in employment, policy measures to bring in new renewable energy corporations to the fuel producing areas will be crucial.

[1] Chris Mooney & Steven Mufson, White House seeks 72 percent cut to clean energy research, underscoring administration’s preference for fossil fuels, Washington Post. Feb. 1, 2018, https://www.washingtonpost.com/business/economy/white-house-seeks-72-percent-cut-to-clean-energy-research-underscoring-administrations-preference-for-fossil-fuelsv/2018/01/31/c2c69350-05f3-11e8-b48c-b07fea957bd5_story.html?utm_term=.d6fff84d89fb.

[2] Ari Natter, Trump Seeks Deep Cuts to Clean Energy Funding Again, Sources Say, Bloomberg. Jan. 31, 2018, https://www.bloomberg.com/news/articles/2018-01-31/trump-said-to-seek-deep-cuts-to-clean-energy-funding-again.

[3] Mooney & Mufson, supra note 1.

[4] Id.

[5] Id.

[6] Justin Worland, This Clean Energy Research Has Been a Bipartisan Priority for Decades. Donald Trump Wants to Cut It by 72%, Time. Feb. 1, 2018, http://time.com/5128572/donald-trump-clean-energy-research/.

[7] Id.

[8] See id.

[9] See id.

[10] Bob Bauder, Brian Bowling & Natasha Lindstrom, Coal, Steel, Manufacturing Struggle After Trump’s First Year, U.S. News & World Report. Feb. 3, 2018, https://www.usnews.com/news/best-states/pennsylvania/articles/2018-02-03/coal-steel-manufacturing-struggle-after-trumps-first-year.

[11] Mooney & Mufson, supra note 2.

[12] Bauder, Bowling & Lindstrom, supra note 9.

[13] The White House, President Donald J. Trump’s Year of Regulatory Reform and Environmental Protection at the EPA (2017). https://www.whitehouse.gov/briefings-statements/president-donald-j-trumps-year-regulatory-reform-environmental-protection-epa/.

[14] Mooney & Mufson, supra note 2.

[15] Id.

[16] See id.

[17] U.S. Department of Energy, U.S. Energy and Employment Report (2017). https://energy.gov/sites/prod/files/2017/01/f34/2017%20US%20Energy%20and%20Jobs%20Report_0.pdf.

[18] Nadja Popovich, Today’s Energy Jobs Are in Solar, Not Coal, The New York Times. Apr. 25, 2017, https://www.nytimes.com/interactive/2017/04/25/climate/todays-energy-jobs-are-in-solar-not-coal.html.

[19] U.S. Department of Energy, supra note 17.

[20] See id.

[21] See generally id.