WASHINGTON (AP) — President-elect Donald Trump plans to create a National Energy Council that he says will establish U.S. “energy dominance” around the world as he seeks to boost U.S. oil and gas drilling and move away from President Joe Biden’s focus on climate change.
The Energy Council — which will be led by North Dakota Governor Doug Burgum, Trump’s pick to lead the Interior Department — will play a key role in Trump’s pledge to “drill, drill, drill” and more oil and sell other energy sources to allies in Europe and around the world.
The new council will have sweeping authority over federal agencies dealing with energy licensing, production, generation, distribution, regulation and transportation, with a mandate to cut red tape, increase private sector investment and focus on innovation instead of ‘completely unnecessary regulation’. Trump said.
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But the president-elect’s energy desires will likely reach real limits. First, US oil production under Biden is already at record levels. The federal government can’t force companies to drill for more oil, and production increases can drive down prices and lower profits.
A call for energy dominance — a term Trump also used in his first term as president — “is an opportunity, not a requirement” for the oil industry to move forward with drilling projects on terms likely to be more favorable to the industry. than those offered by Biden, said energy analyst Kevin Book.
Whether Trump achieves energy dominance — however he defines it — “will come down to decisions by private companies based on how they see the balance between supply and demand in the global marketplace,” said Book, managing partner at ClearView Energy Partners, a Washington research firm . Don’t expect an immediate influx of new rigs onto the national landscape, he said.
Trump’s effort to increase oil supplies — and lower U.S. prices — is complicated by his threat this week to impose 25% tariffs on Canada and Mexico, two of the largest sources of U.S. oil imports. US The oil industry warned that the tariffs could raise prices and even harm national security.
“Canada and Mexico are our most important energy trading partners, and maintaining the free flow of energy products across our borders is critical to North American energy security and American consumers,” said Scott Lauermann, speaking on behalf of the American Petroleum Institute, the oil industry’s main lobbying organization. group.
American Fuel & Petrochemical Manufacturers, which represents U.S. refineries, also opposes possible tariffs, saying in a statement that “U.S. refineries rely on crude oil from Canada and Mexico to produce the affordable, reliable fuels consumers rely on every day. ”
Scott Segal, a former Bush administration official, said the idea of centering energy decisions in the White House follows a lead set by Biden, who appointed a trio of White House advisers to lead climate policy. Segal, a partner at the law and policy firm Bracewell, called Burgum “a steady hand at the helm” with experience in fossil fuels and renewables.
And unlike Biden’s climate advisers — Gina McCarthy, John Podesta and Ali Zaidi — Burgum will likely take his post in the White House as a Senate-confirmed Cabinet member, Segal said.
Dustin Meyer, senior vice president of policy, economics and regulation at the American Petroleum Institute, called the new energy council “a good thing” for the U.S. economy and trade. “Conceptually, it makes a lot of sense to have as much coordination as possible,” he said.
Still, “market dynamics will always be key” to any potential increase in energy production, Meyer said.
Jonathan Elkind, a senior researcher at Columbia University’s Center on Global Energy Policy, called energy dominance an “intentionally vague concept” but said, “It’s hard to see how (Trump) can push more oil into an already saturated market.” ‘
Trump has promised to bring gasoline prices below $2 a gallon, but experts call that highly unlikely as the price of crude oil would have to fall dramatically to reach that goal. Gas prices averaged $3.07 on Wednesday, compared to $3.25 a year ago.
Elkind and other experts said they hope the new Energy Council will move beyond oil and focus on renewable energy such as wind, solar and geothermal, as well as nuclear power. None of these energy sources produce greenhouse gas emissions that contribute to climate change.
“The failure to focus on climate change as an existential threat to our planet is a huge concern and translates into a very significant loss of American property and American lives,” said Elkind, a former assistant energy secretary in the Obama administration . Statistics show that there have been 20 weather disasters this year, each causing more than $1 billion in damage. A total of 418 people were killed.
Trump has downplayed the risks of climate change and pledged to withdraw unspent money in the Inflation Reduction Act, Biden’s landmark climate and health care law. He also said he will halt offshore wind development when he returns to the White House in January.
Yet his Nov. 15 Energy Council announcement says he will “expand ALL forms of energy production to grow our economy and create good-paying jobs.”
That includes renewable energy sources, says Safak Yucel, an associate professor at Georgetown University’s McDonough School of Business.
“The mandate for the Energy Council is US global dominance, but what’s more American than American solar and American wind?” he asked. A report by Ernst & Young last year found that solar energy was the cheapest source of electricity for new construction in many countries. markets.
Trump said in his statement that he wants to dramatically increase baseload power to lower electricity costs, prevent brownouts and “win the battle for AI superiority.”
In comments to reporters before he was appointed to the energy post, Burgum cited a similar goal, noting increased demand for electricity from artificial intelligence, commonly known as AI, and fast-growing data centers. “The AI battle affects everything from defense to healthcare, to education and productivity as a country,” Burgum said.
Although Trump derides the climate law as the “green new scam,” he is unlikely to repeal it, Yucel and other experts say. One reason: Most investment and jobs are in Republican congressional districts. Republican members of Congress have urged House Speaker Mike Johnson to preserve the law, which passed with only Democratic votes.
“A lot of Southern states are saying to Trump, ‘We actually like renewable energy,’” Yucel said, noting that Republican-led states have added thousands of jobs in wind, solar and battery energy in recent years.
If renewables make economic and economic sense, he added, “they will continue.”
