Stockholm (NordSIP) – January 2025 saw the arrival in the US White House of a newly elected administration headed by Donald Trump, who once again described climate change as a hoax throughout his presidential campaign. What are the implications for global climate action of what Trump has already enacted, or has expressed an intention to implement in the future?
Among his first executive orders was the widely anticipated exit of the United States from the Paris Climate Agreement. This will only take effect in a year’s time, at which point three years of Trump’s presidency will remain. The US also left the agreement during his previous term only for his successor Joe Biden to reinstate it. This politically driven flip flopping has even caused frustration within the nation’s fossil fuel industry, with ExxonMobil CEO Darren Woods urging Trump not to leave the agreement.
With the US producing records quantities of oil and gas under both recent Democratic and Republican administration, Trump’s campaign slogan of “Drill baby, drill” is unlikely to translate in a significant rise in output. Woods has also bemoaned the United States’ imminent loss of influence as global climate talks continue without it. Various large US states and cities have also committed to persevering with their own climate strategies regardless of policy changes at federal level.
Green investments and jobs jeopardised
ExxonMobil’s had planned to invest up to $20 billion over the next two years in carbon capture, use and storage (CCUS), hydrogen, lithium extraction and other technologies linked to the low-carbon transition. The federal tax credits that the Texan oil giant included in the financing of these projects were linked to the Biden administration’s Inflation Reduction Act (IRA), which Trump has pledge to reverse. He also plans to revoke policies designed to encourage the adoption of electric vehicles (EVs).
Nevertheless, while Trump has already ordered the halting of any new funding under the IRA, much of it has already been allocated and cannot be reversed. Outgoing President Biden also built safeguards into the legislation that limit the scope of what can be immediately undone. Finally, many of the green jobs and infrastructure that have been created under IRA funding are in Republican districts, which will further hinder Trump’s attempts to reverse these low-carbon transition measures.
Short term emissions spike expected
Although investments in green technologies may continue, and the US exiting the Paris agreement is a largely symbolic act, some of Trump’s executive orders will have a seriously detrimental effect on short-term climate mitigation. He has halted any new permits for renewable energy projects on federal land and waters, while opening up previously protected areas such as Alaska and the Arctic for fossil fuel exploitation. Trump is also lifting limits on the export of liquefied natural gas (LNG), and loosening rules governing emissions from the fossil fuel industry, such as methane leakage. A spike in global greenhouse gas (GHG) emissions is expected as a result of these moves.
Despite Trump’s efforts to reverse climate action and encourage fossil fuel production and use, powerful market forces are already underway that may present and effective countervailing force. Most US multinational firms have begun implementing various levels of GHG emissions reduction initiatives and many have long-term net-zero targets based on a genuine awareness of the existential threat posed by climate change. Some have already committed substantial amounts of capital expenditure to low-carbon transition related investments. Along with state and municipal authorities many of these companies are expected to persist with their long-term climate goals.