Following Donald Trump’s inauguration on Friday, the official White House website was promptly updated with the “America First Energy Plan”.
While the specifics may not have been finalised as of yet, it lays the foundation for the U.S. energy policy over the next four years.
So what are the key highlights of Trump’s energy policy so far?
Donald Trump has appointed some very serious pro-oil magnates into his administration, with the likes of former Exxon-Mobil CEO, Rex Tillerson, expected to win confirmation as Secretary of State and the former Governor of Texas, Rick Perry, chosen as the new secretary of Energy.
It has been speculated as to whether one of his first actions as President will be to push forward with both the Keystone XL and Dakota Access pipelines; ultimately furthering his promise to work against former President Obama.
” The Trump Administration will embrace the shale oil and gas revolution to bring jobs and prosperity to millions of Americans. We must take advantage of the estimated $50 trillion in untapped shale, oil, and natural gas reserves, especially those on federal lands that the American people own.”
The U.S. have already seen great success in exploiting shale gas from fracking over the years, with evidence of it boosting tax revenues, as well as creating new employment. Does this also mean that energy security will improve when relying less and less on imported energy?
The federal government owns in excess of 600 million acres of land, untouched by the fracking boom and Trump has promised to reverse Obama’s policies that restricted energy development on public lands. However, it is reported that federal lands only represented 21% of U.S. oil and gas production in 2015, in comparison to 57% just 5 years earlier.
Amidst criticism for scrapping all references of global warming and climate change, Donald Trump’s energy plans directed a focus around protecting clean air and water instead.
Bloomberg New Energy Finance predicts that Trump won’t halt the renewable revolution alone, suggesting that while regulations on oil and gas drilling are about to be lifted, the inroads of clean energy made globally will continue, along with emerging technologies to create a low carbon economy.
A number of factors can be blamed for the demise of the U.S. coal industry which hit states like West Virginia and Pennsylvania hard; the biggest of which is said to be the rise of natural gas in the power generation sector. In fact, the EIA show that power generation from coal decreased by 226,000 GWh in 2015, while power generated by natural gas increased by 208,000 GWh.
But with a number of coal companies a thing of the past after filing for bankruptcy last year, is this really something that Donald Trump can fix?
“President Trump is committed to achieving energy independence from the OPEC cartel and any nations hostile to our interests. At the same time, we will work with our Gulf allies to develop a positive energy relationship as part of our anti-terrorism strategy.”
Some of OPEC’s biggest suppliers to the U.S. have dismissed Donald Trump’s vow to end dependence on international oil however, with Saudi Arabia’s Energy and Industry Minister Khalid Al-Falih, stating that “the positions that the U.S. and Saudi Arabia take in global energy are very important for global economic stability” and confirming that Saudi Arabia is looking forward to workin with the Trump administration.
Aside from this, in accordance with the U.S. Energy Information Administration, while the U.S. have eliminated much of their foreign dependence on oil, it still imports 9.4million barrels every day.
While Trump’s energy policy is still under review, the future remains undetermined for U.S. energy. As with all change, there will be positives and negatives for the market, but only time will tell what effects the final policy will have on the industry as a whole.