President-elect Donald Trump is set to create a National Energy Council that he says will establish American “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 — to be led by North Dakota Gov. Doug Burgum, Trump’s choice to head the Interior Department — will be key in Trump’s pledge to “drill, drill, drill” and sell more oil and other energy sources to allies in Europe and around the globe.
The new Council will be granted sweeping authority over federal agencies involved in energy permitting, production, generation, distribution, regulation and transportation, with a mandate to cut bureaucratic red tape, enhance private sector investments and focus on innovation instead of “totally unnecessary regulation,” Trump said.
But Trump’s energy wishes are likely to run into real-world limits. For one, U.S. oil production under Biden is already at record levels. The federal government cannot force companies to drill for more oil, and production increases could lower prices and reduce 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 on drilling projects under terms that are likely to be more favorable to industry than those offered by Biden, said energy analyst Kevin Book.
Whether Trump achieves energy dominance — however he defines it — “comes down to decisions by private companies, based on how they see supply-demand balances in the global marketplace,’’ said Book, managing partner at ClearView Energy Partners, a Washington research firm. Don’t expect an immediate influx of new oil rigs dotting the national landscape, he said.
“Canada and Mexico are our top energy trading partners, and maintaining the free flow of energy products across our borders is critical for North American energy security and U.S. consumers,” said Scott Lauermann, speaking for the American Petroleum Institute, the oil industry’s top lobbying group.
American Fuel & Petrochemical Manufacturers, which represents U.S. refineries, also opposes potential tariffs, saying in a statement that “American refiners depend on crude oil from Canada and Mexico to produce the affordable, reliable fuels consumers count on every day.”
Scott Segal, a former Bush administration official, said the idea of centering energy decisions at the White House follows an example set by Biden, who named a trio of White House advisers to lead on climate policy. Segal, a partner at the law and policy law firm Bracewell, called Burgum “a steady hand on the tiller” with experience in fossil fuels and renewables.
And unlike Biden’s climate advisers — Gina McCarthy, John Podesta and Ali Zaidi — Burgum will probably take his White House post as a Senate-confirmed Cabinet member, Segal said.
Dustin Meyer, senior vice president of policy, economics and regulatory affairs 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 the key’’ for any potential increase in energy production, Meyer said.
Jonathan Elkind, a senior research scholar at Columbia University’s Center on Global Energy Policy, called energy dominance a “deliberately 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, since crude oil prices would need to drop dramatically to achieve that goal. Gas prices averaged $3.07 nationally as of Wednesday, down from $3.25 a year ago.
Elkind and other experts said they hope the new Energy Council will move beyond oil to focus on renewable energy such as wind, solar and geothermal power, as well as nuclear. None of those energy resources produces greenhouse gas emissions that contribute to climate change.
“Failure to focus on climate change as an existential threat to our planet is a huge concern and translates to a very significant loss of American property and American lives,’’ said Elkind, a former assistant energy secretary in the Obama administration. He cited federal statistics showing two dozen weather disasters this year that caused more than $1 billion in damage each. A total of 418 people were killed.
Trump has played down risks from climate change and pledged to rescind unspent money in the Inflation Reduction Act, Biden’s landmark climate and health care bill. He also said he will stop offshore wind development when he returns to the White House in January.
Even so, his Nov. 15 announcement of the energy council says he will “expand ALL forms of energy production to grow our Economy and create good-paying jobs.”
That includes renewables, said Safak Yucel, associate professor at Georgetown University’s McDonough School of Business.
“The mandate for the energy council is U.S. dominance globally, but what’s more American than American solar and American wind?’’ he asked. A report from Ernst & Young last year showed that solar was the cheapest source of new-build electricity in many markets.
Trump, in his statement, said he wants to dramatically increase baseload power to lower electricity costs, avoid brownouts and “WIN the battle for AI superiority.”
In comments to reporters before he was named 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 health care to education to productivity as a country,″ Burgum said.
While Trump mocks the climate law as the “green new scam,” he is unlikely to repeal it, Yucel and other experts said. One reason: Most of its investments and jobs are in Republican congressional districts. GOP members of Congress have urged House Speaker Mike Johnson to retain the law, which passed with only Democratic votes.
“A lot of Southern states are telling Trump, ‘We actually like renewables,’” Yucel said, noting that Republican-led states have added thousands of jobs in recent years in wind, solar and battery power.
If renewables make economic economic sense, he added, “they’ll continue.’’
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Republished with permission of The Associated Press.
6 comments
PeterH
November 29, 2024 at 12:42 pm
The oil industry has repeatedly reported that there is no profitability in pumping crude at less than $50 per barrel. It’s called supply and demand….. it’s called capitalism.
Keep listening to a failed American businessman who has cost the American taxpayer millions propping up his six bankruptcies!
TJC
November 29, 2024 at 3:12 pm
“…Republican-led states have added thousands of jobs in recent years in wind, solar and battery power.”
But that means nothing to Trump, who must have his way no matter how wayward it may be.
There is no denying it, come January 2025 “Shitshow II,” the sequel, begins.
Earl Pitts American
November 29, 2024 at 3:54 pm
Good afternoon America,
Nothing to see her just more @ss Press, [FKA Associated Press] propaganda.
LET NOT YOUR HEARTS BE TROUBLED:
In fact you may Relax your political Sphincters secure in the knowledge Earl will keep you safe with The Truth.
Thank you, America,
Earl Pitts American
*America, that post by TJC, above my Sage Post of Sage Wisdom is best ignored … this TJC characture is nothing but a trifilaning Dook 4 Brains Lefty* Earl
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Chuck Anziulewicz
November 30, 2024 at 10:54 am
Trump is a bit late to the starting gate. The United States is already producing more oil than any other country ….. INCLUDING Saudi Arabia.