When you look closer, what stands out about Trump’s policies is how few of them are designed to lower energy prices. Instead, they aim to do virtually the opposite: shore up oil and gas demand. According to The Wall Street Journal, ensuring demand for oil and gas products — and not deregulating drilling further — is what the industry has asked Trump to do. That makes sense. The United States is, at the moment, producing more oil and gas than any country in world history. The fossil fuel industry’s problem isn’t getting gas out of the ground, but finding people to sell it to. By suspending fuel economy and energy efficiency rules, Trump can force Americans to use more energy — and spend more on oil and gas — to do the same amount of useful work.
In other places, what stands out about Trump’s policies is their incoherence — and how few of his constituencies they will satisfy. Late on Monday, Trump suggested that he might impose 25% tariffs on Canada and Mexico as soon as February 1. Such an action would quickly harm key segments of the American energy industry. Canada exports about $124 billion of crude oil to the United States every year — much of it a heavy, sludgy petroleum from the Albertan oil sands. That sludge is piped across North America, then fed into U.S. refineries, where it helps produce a large portion of America’s fuel supply. (Alberta’s heavy, sulfurous sludge is particularly well-suited to mixing with the light, sweet crude produced by American frackers.) Should Trump impose those tariffs, in other words, he would gambol into a self-imposed energy crisis.
Tariffs are not the only place where Trump could undermine his own policies. One of his executive orders on Monday aimed to establish America as “the leading producer and processor of non-fuel minerals, including rare earth minerals”; three clauses later, it announced an end to the federal government’s so-called “EV mandate.”
But by kneecapping demand for electric vehicles, Trump will hurt the critical minerals industry more than any anti-growth hippie could fathom. For the past few years, corporate America and Wall Street have invested billions of dollars in lithium and rare-earths mining and processing facilities across the country. These projects, which are largely in Republican districts, only make financial sense in a world where the United States produces a large and growing number of electric vehicles: EVs make up the lion’s share of future demand for lithium, rare earth elements, and other geostrategically sensitive rocks, and any mines or refining facilities will only pencil out in a world where EVs purchase their output. If Trump kills the non-Tesla part of the EV industry, then he will also mortally harm those projects’ economics.
Energy is a strange issue. Although it is one of the key inputs into the modern industrial economy, millions of Americans engage with it as an expressive, symbolic matter — as just another battleground in the culture war. Today, Donald Trump has become the most powerful American in that category. On his first day in office, he has demonstrated that he will use energy policy to advance his extreme ideas about how the Constitution and presidential authority works. How far he gets now will depend on what the American public, business leaders, congressional Republicans, and the Supreme Court’s arch-conservative majority will accept — and whether his fragile constituency is really ready to pay the costs of “American greatness.”
Both solar and offshore wind continue to advance technologically, with promising innovations on the horizon. There are still “a lot of discussions going on about the future of offshore wind, about floating wind, about the development of the technology and the infrastructure needed on the West Coast to support floating wind,” Sanchez said.
The solar industry benefits each year from “continued improvements in efficiency of solar modules,” Smith said. “Now we’re using almost exclusively bifacial solar modules, which increase the energy yield.”
Marlene Motyka, Deloitte’s U.S. renewable energy leader, said she’s hopeful that solar cell technology will continue to advance with further innovations in materials like silicon and perovskite, and she’s excited about a December report from SEIA and Wood Mackenzie that said U.S. solar module factories are now equipped to meet nearly all domestic demand.
Motyka said Deloitte expects “good momentum” for the industry in 2025: “We don’t expect, and I think lots of people out there don’t expect, the IRA to completely be blown up and be obliterated.”
“There are a lot of things that have been coming together over time, and that’s not going to be stopped on a dime,” she said. “I’ve been involved in renewable energy for 17 years, and all of it is kind of coming together now. I think it’s still an exciting time.”
Donald Trump wants oil companies to “drill, baby, drill” on the first day of his presidency, but his fossil-fuel benefactors have a different agenda.
Many of the tycoons who backed the Republican’s victorious campaign say what they need help with is shoring up demand for their products—not pumping more fossil fuels, which they have little incentive to do.
They are pushing for policies that would lock in fossil-fuel use, such as easier permitting for pipelines and terminals to shuttle fossil fuels to new markets. They also favor eliminating Biden administration policies meant to put more electric vehicles on the road.
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But some donors grimace when they hear Trump promise that under his watch, crude-oil producers would open the floodgates. He has also promised to cut Americans’ energy costs by 50% or more.
Oil backers’ skepticism stems from the fact that Wall Street has successfully pressured chronically indebted frackers to stop burning through cash, and return it to shareholders via buybacks and dividends instead of reinvesting it to frack more wells.
“Our stocks will be absolutely crushed if we start growing our production the way Trump is talking about it,” said Bryan Sheffield, a Texas oilman who contributed more than $1 million to Trump’s latest campaign.
Another limiting factor for shale companies is geology. Drillers are running out of premium wells, and many don’t have the runway to pump more oil than they are already.