Balances and challenges: What impact will Biden’s victory have on the energy industry?

Yoana Cholteeva 11 November 2020 (Last Updated November 13th, 2020 15:33)

With the US election results announced, we round up the reactions from around the global energy industry to estimate the impact the new administration could have on renewable generation and decarbonisation.

Balances and challenges: What impact will Biden’s victory have on the energy industry?
When it comes to differences between President Trump and President-elect Biden, it is perhaps their stances on energy policy and climate change that are true polar opposites. Source: Flickr

Despite ballots in Alaska and North Carolina still being counted, and Georgia’s two Senate seats awaiting the results of January runoff elections, Joe Biden has been pronounced the new US president-elect.

While both parties are currently estimated to have 48 seats in the new Senate, we are yet to see whether one will take control.

When it comes to differences between President Trump and President-elect Biden, it is perhaps their stances on energy policy and climate change that are true polar opposites.

While Trump saw climate change precautions as a threat to the economy and continued to fund the fossil fuel industry, Biden is reportedly planning to issue executive orders to quickly reverse some Trump measures, including the exit of the Paris climate agreement.

Greenpeace: “While far from perfect, his climate plan is the most ambitious and far-reaching”

As part of his climate and energy plan, President-elect Biden has firmly pledged to build a more resilient, sustainable economy, which works to reach a clean energy economy within the 2050 Paris Agreement deadline.

He has also promised to make a $2tn accelerated investment, with a plan to deploy resources over his first term to meet the ambitious climate progress that science demands.

With this substantial investment, Biden is planning to focus on energy infrastructure, the auto industry, housing, agriculture, and environmental justice in order to build a solid structure of skilled trades. Engineering workers will be an additional focus, to help make the clean energy economy possible.

Although current US President Donald Trump chose to withdraw the country from the Paris Climate Agreement three years ago, which was officially enforced by climate officials on 4 November, Biden recently expressed his dedication to re-join the climate change forum as soon as he settles in the White House in January 2021.

Commenting on the president-elect’s proposed energy strategy, Greenpeace US climate campaigner Ashley Thomson says: “Biden’s climate and clean energy plan has improved throughout the presidential race in response to pressure from groups like Greenpeace.

“While far from perfect, his plan is the most ambitious and far-reaching climate platform of any presidential nominee for a major party in history. Particularly, we applaud Biden’s commitments to direct at least 40% of climate investments to communities facing environmental injustice, require 100% clean energy by 2035, and hold polluters accountable.”

Emphasising the work that still needs to be done to tackle issues with the US energy industry, Thomson adds: “But to stave off the worst impacts of the climate crisis and reach net-zero emissions without relying on false solutions like carbon capture and storage, Biden must go further to stop the reckless expansion of fossil fuels and support workers and communities with a managed phaseout of fossil fuel production.”

Losing control of the Senate, which might still remain in Republicans’ hands, would make it challenging for the Biden administration to spur a radical energy policy change, such as approving the ‘the Green New Deal’ package, which combines Roosevelt’s economic approach with modern ideas such as renewable energy and resource efficiency.

Senate control notwithstanding, there are parts of his climate agenda that can be driven through executive power alone.

American Wind Energy Association: “The US wind sector and its growing workforce stand ready to help put that plan into action

Biden has made his first speech as President-elect of the US and hopes are up that this will bring more positives for renewable energy in the country.

American Wind Energy Association CEO Tom Kiernan said in a statement: “The President-elect and his team have laid out an ambitious, comprehensive approach to energy policy that recognises renewable energy’s ability to grow America’s economy and create a cleaner environment, while keeping electricity costs low and combating the threat of climate change.

“The US wind sector and its growing workforce of over 120,000 Americans stand ready to help put that plan into action.” Luca Zerbini, Peak Point Partners co-founder and managing partner of Amcor, a venture capital fund focused on technology and sustainability,  emphasises the impact that the change of administration can have on climate change and energy in a global sense.

He says: “The entire world needed the US to bring back the ethical and technological leadership to win the race on climate change. The Biden plan is clearly well supported, well-financed, and would bring the US and the world back on track to deliver the results we need collectively.”

In order to address popular fears that clean energy efforts could harm the economy and cause redundancies, he says: “We have to get rid of the old way of thinking that the clean economy and jobs don’t go together: they do. There are currently more than three million people in the United States employed in the clean energy economy. There is a huge opportunity to revitalise the US energy sector, boost growth economy-wide, and re-claim the mantle as the world’s clean energy leader and top exporter.”

IEA: “Looking forward to supporting President-elect Joe Biden and Vice President-elect Kamala Harris to help the United States”

The past two weeks have seen developments in some of the world’s major economies, which have raised their climate ambitions significantly.

After Japan and Korea both pledged to reach net-zero emissions by 2050, and the US’s presidential elections opened the prospect that the next administration will make efforts to further reduce emissions, the IEA expressed its hopes about the clean renewable future of the industry.

IEA executive director Dr Fatih Birol said in a tweet: “Looking forward to supporting President-elect Joe Biden and Vice President-elect Kamala Harris to help the United States – a founding member of the IEA – meet its energy & climate goals and speed-up global clean energy transitions.”

Rami Reshef, CEO of fuel cell energy solutions manufacturer Gencell says that Biden’s commitment to tackle climate change by reducing fossil fuel emissions is very encouraging but a clear strategy has to be put in place.

He says: “For the world to achieve its climate targets, it is imperative that the new Biden administration’s climate plan, which will see $400bn invested over 10 years in clean energy and climate research, include a similar commitment to building out the hydrogen economy. Significant investment is needed to overcome one of the key obstacles to the use of hydrogen energy – the high cost and complexity of creating an infrastructure to transport and store that hydrogen.

“To rapidly build out the hydrogen energy economy, the EU and many of its member states, as well as Japan, Australia, and other nations, have issued hydrogen roadmaps with substantial financial commitments to enhance hydrogen infrastructure.”

American Council on Renewable Energy: “Renewable energy can help power America’s economic recovery”

American Council on Renewable Energy president Gregory Wetstone expressed the council’s stance that it is time for the US to move “beyond climate denial and resume a global leadership role in the fight against climate change”.

“An accelerated transition to renewable power provides both climate protection and economic prosperity. With more than $60bn in annual investment, and two of the nation’s fastest-growing job categories – wind turbine technician and solar power installer – renewable energy can help power America’s economic recovery, as it did in 2009,” Wetstone added.

Leaders outside of the US also released statements welcoming Biden’s victory and the potential impact it can have on the global energy scene.

Clean Energy Canada executive director Merran Smith said: “After observing several years of climate denial and policy rollbacks, we welcome this new administration and its plans to build a more sustainable economy….The President-elect’s proposed climate and jobs plan joins commitments from around the world from countries like Germany, South Korea, and the UK, which have all poured billions into a cleaner global recovery.

“Canada’s federal government said during the recent Throne Speech that climate action would be a ‘cornerstone’ of its economic recovery. Canada must now follow through on these commitments in order to capitalise on shifting global markets while creating opportunities for Canadian exports, from renewable power to sustainable metals and minerals to clean technology.”