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“The environmental movement is, in my view, the greatest threat to freedom and prosperity in the modern world,” states to Myron Ebell, an adviser to the US president Donald Trump’s administration. Ebell said US voters had rejected what he dubbed the “expertariat” and said there was no doubt that Trump thinks that climate change is not a crisis and does not require urgent action.
Trump himself has called climate change “a hoax” and “bullshit”. He has said he would abolish the Environmental Protection Agency (EPA), abandon the US Clean Power Plan, pull out of the Paris Agreement, signed by 196 nations, while boosting coal and natural gas production.
Environmental responsibility formed the original basis for renewable energy, smart grids, buildings and cities, and our pursuit of greater energy efficiency. In the last two decades those sectors have evolved beyond simple environmental protection measures, they created value outside of the green discussion, and merged with other disciplines such as traffic, health and security.
If we now remove environmental protection from the discussion, what will that mean for the future of the smart technology, energy efficiency and renewable energy industries?
This is not as theoretical a question as it may seem. In their initial days in office, Donald J. Trump’s team have already swapped the climate change page on the White House website for a fossil-fuel-based energy policy – An America First Energy Plan. This energy plan makes no mention of clean energy, solar and wind power, or even energy efficiency.
Instead, the new energy plan talks about “maximizing the use of American resources” and “freeing us from dependence on foreign oil.” The America First Energy Plan states that “for too long, we’ve been held back by burdensome regulations on our energy industry,” and that “the Trump administration is committed to energy policies that lower costs for hardworking Americans.”
The plan for the energy department, according to former Texas Gov. Rick Perry, “would roll back funding for nuclear physics and advanced scientific computing research to 2008 levels, eliminate the Office of Electricity, eliminate the Office of Energy Efficiency and Renewable Energy and scrap the Office of Fossil Energy, which focuses on technologies to reduce carbon dioxide emissions.”
The message is pretty clear; full support for fossil fuels and complete disregard for clean energy and energy efficiency. Two controversial pipelines have already been resurrected, despite strong resistance from environmental groups and local Native American populations. While the EPA, whose staff have been banned from speaking publically, is facing a two-thirds reduction in workforce over the next 4 years and a much sooner 50% plus budget cut.
The plan seems quite clear too. Unleash the power of business and industry by removing environmental regulation. President Trump promised to grow the US economy and create jobs, he did not promise to protect the environment. By disregarding the environment he can boost the US economy and create jobs, but this can also be achieved by supporting energy efficiency and the clean power sector – while also protecting the environment for current and future generations around the world.
In fact, since 1987, federal energy efficiency standards on appliances and equipment have saved hardworking Americans over $2 trillion on energy costs. Standards set in 2016 alone will save $75 billion on US utility bills. With such considerable cost-cutting ability, it’s no surprise that efficiency standards have long enjoyed bipartisan US support, not to mention global endorsement.
US electricity bills and their per-kilowatt-hour rates have essentially been stable and affordable for decades, thanks in large part to government support of energy efficiency and renewable resources. With adjustment for inflation, US electricity is actually cheaper today than it was in 1990. For some areas of the US, solar and wind energy are already cost-competitive compared with fossil fuels, therefore help to lower every citizen’s utility bills.
So where does this leave the renewable energy and energy efficiency related industries, including smart cities, buildings and grids? We can only speculate at this stage but it is difficult to find positives.
Greater support and subsidies for fossil fuels, alongside reduced support for clean technology, would certainly make renewable energies, such as wind and solar, less cost competitive. This can only mean slower growth or worse for the renewable energy industry.
Energy efficiency regulation forces buildings and businesses to reduce electricity consumption, for the sake of the environment, lowering bills and reducing the demand placed on the power sector. While there are benefits to the consumer, regulation is a major driving force for growth in the smart technology sector. Whether the energy efficiency industry in the US can maintain growth without such regulation remains to be seen, but we must assume this will negatively impact growth.
Many US renewable energy and energy efficiency companies have become world leaders in their fields. However, if these developments transpire, foreign markets such as Europe and Asia, where regulation remains strong, may become far more attractive to US firms. We are yet to see the details of President Trump’s proposals to restrict US firms leaving the US, but signs suggest that US firms may find themselves stuck between a law and an unprofitable place.
Environmental concerns aside, this emerging political direction could be very bad for business, at least for clean and smart technology in the US. Focusing on non-green benefits of smart technology, such as security, comfort and health, may provide an avenue for growth, but greenness would represent a significant loss. The former era of unrestricted support for fossil fuels may have been a great time for the US economy, but recent decades have shown that it is not the only way to “make America great again.”
For the global environment and climate change, reawakening fossil fuels at the expense of renewable energy and energy efficiency, in the worlds largest economy can only be bad news. On the other hand, as Trump’s advisor Ebell once said, “many people have realized that warmer climates are more pleasant and healthier.”