Monday, 14 November 2016

Why Trump might not make much of a difference to action on climate change

The election of Donald Trump probably means that, one way or another, the USA will pull out of the Paris Agreement on climate change, but this may make less difference to how much carbon the world would have emitted than what you might think.

For a start the Paris Agreement already has enough national states as signatures representing a high enough proportion of global greenhouse gas emissions to remain valid with a US withdrawal. The Agreement  requires there to be signatories representing at least 55 per cent of global emissions, and there's more than that left in the agreement without the USA.

Second, internally, such downwards pressure on carbon emissions as there is is mainly bound up with technological changes or policies that are likely to continue anyway. Coal consumption in the US has fallen by around a quarter since 2008, but. according to a recent paper published in The Electricity Journal this has very little to do with Obama, and almost all to do with the increased availability of cheap natural gas. The growth in production of shale gas has been the factor that has reduced the demand for coal and led to the closure of increasing numbers of ageing coal fired power plant. Another factor reducing coal use is the growth of renewable energy - mainly wind and solar. These technologies are promoted by a bi-partisan Congressional agreement on a policy of production tax credits (wind) and investment tax credit (solar). These will  decline in force and run out in 2020. However, many Republican Congressmen are relatively sympathetic towards renewable energy, and there are possibilities that some form of tax credit support could be renewed. The Republicans may not care much for the climate issue, but they are interested in helping people, including often the renewable energy industry, make money.

Certainly Trump is likely to want to short-circuit Obama's 'Clean Power Plan' which was being pursued through the aegis of the Environmental Protection Agency, although even here, many states will continue with their own clean power plans. Trump may order the reversal of the regulations restricting mercury and toxic emissions, compliance with which makes coal plant more expensive. However, as stated already, coal power plant are being retired without this measure anyway. In addition it is unlikely that the revision of standards to allow more mercury and toxic emissions will please many people given that the EPA estimates that otherwise between 4000 and 11000 people will die each year from poisoning by these toxics. Resistance to Republican initiatives to pare down environmental regulations may prove to be rather sturdier and more effective than the anti-environmentalists bargain for.

Third, there is the global impact of Trumps' protectionist trade strategies to consider. Trade restrictions on China, and quite possibly even the EU, may help relieve competitive pressure on some US industries, but they will, overall, make the world poorer. China's economy is less robust than it appears, with rising levels of bank debts and it is vulnerable to US pressures to increase the value of its currency. Indeed, my outlook is that there will be anything from a global slowdown in economic growth to a full-blown world economic meltdown. This of course, to a greater or lesser extent, will have a downward pressure on carbon emissions and probably more than offset the impact of Trumps's reversal of Obama's internal energy measures. On top of that of course, there are suggestions that the EU could impose a carbon tax on US imports to offset reductions in environmental performance by UK goods and services. This idea actually comes from Nicolas Sarkozy.

Some references:

1 comment:

  1. Thanks, Dave, for your note of cautious optimism, much welcome amongst the doom and gloom.