How Trump or Harris Would Alter the U.S.’s Energy and Power Landscape
A new U.S. president will be inaugurated in less than five months. Polls show the race between Donald Trump and Kamala Harris to be very close, with potentially only a few swing states deciding the election. While energy policy may not be a deciding factor for many Americans in choosing who they will vote for, it is very important to power industry professionals.
With that in mind, Mary Anne Sullivan, senior counsel with the law firm Hogan Lovells, and Megan Ridley-Kaye, a partner with Hogan Lovells, were interviewed as guests on The POWER Podcast to discuss how the candidates might differ in their areas of focus if they won the election. Among the most pronounced differences is the rhetoric the two might espouse.
“A Trump administration, I think, would talk a lot more about energy security, energy independence, and the need to be friendly to American-made fossil fuels,” Sullivan said. “A Harris administration, I assume, will follow in the footsteps of the Biden administration and focus on the need to respond to climate change and build on what have truly been unprecedented accomplishments under the Infrastructure Investment and Jobs Act and the IRA [Inflation Reduction Act],” she said.
Although a Trump administration might seek to repeal all or at least parts of the IRA, Sullivan thought that would be hard to achieve. “I think recent indications are that it [the IRA] has now a fair bit of support in Congress,” she said. Ridley-Kaye agreed. “Obviously, key to what happens there [the fate of the IRA] is what happens in Congress,” she said. “It seems increasingly unlikely that it will be repealed.”
And, while the government has made major investments that support energy and power projects, private parties have invested a lot of money too. At this point in the cycle, however, Ridley-Kaye suggested some of her clients are beginning to take a wait-and-see approach, especially if project economics are not viable without tax credits. Still, many other investors are unworried about the possibility of policy changes. “We do have a large group of clients that would say, ‘The train has left the station. Corporate America expects the tax credits. There’s no way that they would be taken away,’ ” Ridley-Kaye said.
Offshore wind is among the areas where the candidates’ opinions differ. “Donald Trump has been clear for a very long time that he doesn’t like wind power, and particularly, doesn’t like offshore wind,” said Sullivan. “I think Kamala Harris recognizes that offshore wind is particularly valuable because of its proximity to population centers.”
On a more general level, Sullivan would expect more “activism” from a Harris administration, while a Trump administration would be more market oriented. Concerning electric vehicles (EVs), she said Trump has been somewhat mixed on his feelings toward them. “He may or may not be friendly to that [vehicle electrification], but I expect a Harris administration will be all in on the transition to EVs,” Sullivan said.
Environmental policy shifts seem to be the norm when administrations change. “EPA [Environmental Protection Agency] regulation of power plant emissions has been the ultimate political football through at least the last three administrations, and I think we’ll see big differences there,” said Sullivan.
In January, the Biden administration announced a temporary pause on pending decisions on exports of liquefied natural gas (LNG) to non-free trade agreement countries until the Department of Energy could update the underlying analyses for authorizations. Sullivan said that would almost certainly end if Trump wins the election. Whereas, Harris might push to wrap up the analysis, but she wouldn’t likely be as quick to simply restore past practices without further reflection.
Meanwhile, there are some areas where the candidates may see eye to eye. “No matter which of them is elected, I think they will both recognize the need for more power transmission and more power generation,” said Sullivan. “Although the Biden administration has talked a good game about greening power generation, they have also very much pursued an all-of-the-above approach to generation resources. And I would expect that to continue in a Harris administration, just because there are so many new demands for electricity—the data centers, AI [artificial intelligence], vehicle electrification, the sort of ‘electrify everything’ movement that some people talk about,” she said.
Two other areas where Trump and Harris might support similar policies are on nuclear power, and carbon capture and storage. “The two administrations might have different motivations for pursuing that, but I think either one will support further technology development there,” Sullivan supposed.
Sullivan would expect a more light-handed approach to regulation under a Trump administration, specifically, as applied to permitting energy infrastructure projects. “But that more light-handed regulation on permitting helps the carbon-free power projects as much as the carbon-intensive power projects. It cuts both ways,” she said.
Depending on how the election plays out, the energy and power landscape could change very quickly. “Trump’s team seems much more ready to move on policy than it did when he ran the last time. I think they’re thinking about it in advance. They’re building a desired set of policies,” Sullivan said. “I do expect them to be more ready to move on their policy objectives.”
To hear the full interview with Sullivan and Ridley-Kaye, which contains more about tax credits, deal-making, fossil fuel exploration and production, electric grid reliability and resilience, interstate energy commerce and regulation, and more, listen to The POWER Podcast. Click on the SoundCloud player below to listen in your browser now or use the following links to reach the show page on your favorite podcast platform:
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—Aaron Larson is POWER’s executive editor (@AaronL_Power, @POWERmagazine).