How Trump’s second term could derail the clean energy transition

The Biden administration has enacted the most consequential federal clean energy and climate policy in U.S. history, giving the nation a fighting chance at reducing greenhouse gas emissions fast enough to deal with the climate crisis. Former President Donald Trump, who has won the 2024 presidential election, has pledged to undo that work.

Though Trump’s executive powers will allow him to slow the energy transition in a number of ways, the extent to which he rolls back Biden’s clean energy accomplishments will be dictated in part by whether Republicans retain control of the House of Representatives. The GOP flipped the U.S. Senate, but votes are still being counted in key House races as of Wednesday morning.

Here’s what clean energy and climate experts say is most likely to be lost under a second Trump administration — and what might survive.

What Trump has said about energy

Trump’s rhetoric presages a worst-case future. He has called climate change a hoax and the Biden administration’s climate policies a ​“green new scam.” He has said he wants to repeal the landmark Inflation Reduction Act and halt the law’s hundreds of billions of dollars of tax credits, grants, and other federal incentives for clean energy, electric vehicles, and other low-carbon technologies.

Trump has also made ​“drill, baby, drill” a call-and-response line at his rallies, pledging to undo any restraints on production and use of the fossil fuels driving climate change. U.S. oil and gas production is already at a record high under the Biden administration.

“He has pledged to do the bidding for Big Oil on day one,” Andrew Reagan, executive director of Clean Energy for America, said during a recent webinar.

“Oil and gas lobbyists are drafting executive orders for him to sign on day one,” Reagan added, citing news reports of plans from oil industry groups to roll back key Biden administration regulations and executive orders.

A Trump administration would be all but certain to reverse key Environmental Protection Agency regulations limiting greenhouse gas emissions from power plants, light-duty and heavy-duty vehicles, and the oil and gas industry, all of which analysts say are necessary to meet the country’s climate commitments. It’s also almost sure to lift the Biden administration’s pause on federal permitting of fossil-gas export facilities.

Trump has also promised to withdraw the U.S. from international climate agreements (again), including the Paris agreement aimed at limiting global warming to no more than 2 degrees Celsius above pre-industrial levels.

“We know that Trump would take us out of the Paris agreement, and that would be the last time his administration uttered the word ​‘climate,’” Catherine Wolfram, an economist at the MIT Sloan School of Management and former deputy assistant secretary for climate and energy economics in the Biden administration’s Treasury Department, told Canary Media. ​“Losing that global leadership would be one of the greatest losses of a Trump presidency.”

What will happen to the Inflation Reduction Act? 

Trump won’t have the power to enact all of his promises on his own. Some of the decisions must be made by Congress, including any effort to repeal the Inflation Reduction Act or to claw back unspent funds from that law or the 2021 bipartisan infrastructure law.

Complete repeal of the Inflation Reduction Act would be highly disruptive to a clean energy sector that has seen planned investment grow to roughly $500 billion since the law was passed in mid-2022.

It would also undermine clean energy job growth, which has increased at roughly twice the pace of U.S. employment overall. A recent survey of clean energy companies found that a repeal of the law would be expected to lead to half of them losing business or revenue, roughly one-quarter losing projects or contracts, about one-fifth laying off workers, and about one in 10 going out of business. 

“We found that especially rural areas and smaller rural communities would experience the largest negative impacts of repeal of the Inflation Reduction Act,” Shara Mohtadi, co-founder of S2 Strategies, said in an October webinar presenting the survey data. ​“These are the regions of the country that have seen the biggest uptake in the economic benefits and the manufacturing jobs coming from other countries into the United States.”

Indeed, most of the investment and job growth the IRA has spurred has taken place in states and congressional districts represented by Republicans.

These on-the-ground realities have driven expectations that large swaths of the law’s tax credits would be likely to survive even with Republican control of the White House and both houses of Congress. Trump would face pushback within his own party to undoing the law entirely.

In an August letter to current Speaker of the House Mike Johnson (R-Louisiana), 18 House Republicans warned against repealing the clean energy and manufacturing tax credits created by the Inflation Reduction Act, which have ​“spurred innovation, incentivized investment, and created good jobs in many parts of the country — including many districts represented by members of our conference.”

“Prematurely repealing energy tax credits, particularly those which were used to justify investments that already broke ground, would undermine private investments and stop development that is already ongoing,” the 18 House Republicans wrote. ​“A full repeal would create a worst-case scenario where we would have spent billions of taxpayer dollars and received next to nothing in return.”

Republicans would need a roughly 20-seat majority to overcome opposition from these party members opposed to a full repeal, said Harry Godfrey, head of the federal investment and manufacturing working group of trade group Advanced Energy United.

“I don’t envision Republicans holding the House with 20-plus seats,” he said.

Godfrey also doubted that a Trump administration would be eager to undermine the domestic manufacturing boom that the law’s tax credits have spurred. He noted that at the October 1 vice-presidential debate, J.D. Vance, the Republican Ohio senator and Trump’s running mate, emphasized the need for the U.S. to ​“consolidate American dominance” in key energy sectors and industries now dominated by China.

While Vance went on to falsely accuse the Biden administration of failing to bolster U.S. industries against China, the goal of emphasizing domestic competitiveness could lead Republicans to avoid undermining progress in that direction, he suggested.

But such logic may not prevail, MIT’s Wolfram said. ​“If we’re building a lot of battery factories and solar plants in red congressional districts, hopefully that will insulate IRA from repeal,” she said. ​“But I fear there’s a risk that Republicans would want to destroy Biden’s signature climate achievement, even if it’s against their economic interests.”

The GOP could also decide it would rather steer money earmarked to clean energy to other priorities — like tax cuts.

Wolfram co-authored a recent paper that suggested Republicans might seek to get rid of tax credits and other federal climate spending in an attempt to reduce the federal deficit because the deficit would be expected to balloon if they extend the tax cuts enacted by Congress during the first Trump administration, which are set to expire at the end of 2025.

What can Trump do on his own? 

While Congress would need to take action to fully repeal the Inflation Reduction Act, a Trump administration can make moves on its own to halt or at least complicate the provision of the IRA’s tax credits, Godfrey said, such as instructing the Treasury Department to amend, suspend, or delay implementation of the rules that determine how tax credits are calculated and disbursed.

“There is space for an administration that wants to throw sand in the gears to come in and say, ​‘We’re suspending the rule, or we’re suspending the notice of proposed rulemaking,’” Godfrey said. ​“People should be concerned about a Trump administration without complete control of Congress to use administrative powers to readjust those rules in a way that will be detrimental to their implementation.”

Beyond obstructing the Inflation Reduction Act rollout, other decisions fall squarely within the authority of the executive branch — and a future Trump administration has a blueprint to follow on those fronts.

Project 2025, the policy platform created by right-wing think tank the Heritage Foundation, calls for restructuring federal agencies — including the Environmental Protection Agency, the Department of Energy, and the Department of Interior — in ways that would restrict or end their roles in promoting clean energy and reducing greenhouse gas emissions.

Trump has disavowed any knowledge of or support for Project 2025, but CNN has reported that at least 140 people who worked in the Trump administration were involved in the project, including six of his former Cabinet secretaries.

Among the proposals in Project 2025: reversing a landmark 2009 finding from the EPA that carbon dioxide emissions are a threat to human health, which is currently the basis for federal regulations on greenhouse gases. The platform also calls for EPA to reconsider rules limiting tailpipe emissions from road vehicles and withdraw California’s long-held option to set its own vehicle standards — an ability that has allowed it and more than a dozen other states to adopt more stringent emissions rules for cars, trucks, and buses than the federal government.

Project 2025 would also have the Interior Department prioritize fossil-fuel extraction on federal lands and have the Federal Energy Regulatory Commission end consideration of environmental impacts of new fossil-gas pipelines. And the blueprint calls for key programs within the Department of Energy to be ​“eliminated or reformed,” including the Office of Clean Energy Demonstrations, Office of State and Community Energy Programs, Grid Deployment Office, and the ARPA-E advanced energy R&D program.

The $400 billion pool of loan authority under the DOE’s Loan Programs Office is also under threat. That program has already made tens of billions of dollars available to solar projects, battery factories, nuclear power plants, clean hydrogen production sites, critical-minerals mining, processing, and recycling, and a host of other climate-related projects. Project 2025 calls for eliminating the office, which under former President Obama gave crucial early loans to Tesla. News reports indicate some prospective Trump administration officials want to redirect the loan program toward fossil fuel projects instead.

A full-scale implementation of the Project 2025 agenda would harm not just U.S. clean energy and climate-related investments and economic growth, but also broader job growth and energy costs, according to an August report from think tank Energy Innovation. The analysis found that the policies called for in the blueprint would result in $320 billion in annual GDP losses, 1.7 million clean energy jobs lost, $32 billion in higher household energy costs, and an increase in greenhouse gas emissions of roughly 1 billion metric tons by 2030 compared to a scenario in which current policies were kept in place.

Godfrey expressed hope that a Trump administration would forgo the more drastic parts of Project 2025, such as eliminating ​“whole arms of DOE” that support industries such as critical-minerals mining, processing, and recycling, which are seen as crucial to U.S. competitiveness against China.

Yet he also warned that companies that have won promises of loans and grants from agencies under the Biden administration but haven’t yet received them could face the threat of clawback. ​“If you have an executed agreement in place, you should be OK. Anything short of that, I think there’s some risk there,” he said.

All of these threats run the risk not only of delaying urgent action on climate change, but of causing economic hardship in a world in which carbon-free energy is clearly beating fossil fuels on purely economic terms, said Tom Steyer, the billionaire founder of Farallon Capital Management who has backed a variety of climatetech investments and political and philanthropic causes.

“The only political party on the globe that still is denying that climate change has an impact economically and environmentally is the Republican Party,” Steyer told Canary Media earlier this year. ​“The cost of wind and solar and batteries is going to drop precipitously. The advantage they have in cost is only going to get bigger.”

“For the U.S. to try to give up the future and go back to the 1950s — an internal-combustion-engine, fossil-fuel-driven world — it destroys jobs in the United States, destroys industries in the United States, and drives up inflation,” he said.

Gina McCarthy, former national climate advisor in the Biden administration and head of the EPA under the Obama administration, was defiant in a statement Wednesday morning.

“No matter what Trump may say, the shift to clean energy is unstoppable and our country is not turning back,” McCarthy wrote. ​“Our coalition is bigger, more bipartisan, better organized, and fully prepared to deliver climate solutions, boost local economies, and drive climate ambition. We cannot and will not let Trump stand in the way of giving our kids and grandkids the freedom to grow up in safer and healthier communities.”