A new administration tends to bring a slew of new policies to Washington; Trump’s latest victory will be no different. The energy agenda to be ushered in come January will likely be reminiscent of four years ago which centered around an all-of-the-above platform. Considering the growing demands within the energy arena, this country is going to need everything at its disposal.
The current administration’s focus on renewable or so-called low carbon sources such as wind, solar, and electric vehicle (EV) battery technology has led to a host of complications and proved to be a futile strategy to serve the American public. The combination of the Inflation Reduction Act (IRA)—considered the biggest climate action in U.S. history—and a number of agency rules and regulations has hurt businesses and consumers nationwide.
Regions where wind and solar are a large portion of the energy mix are experiencing energy shortages and continue to be at serious risk for grid disruptions. The EPA’s stringent power plant rules are projected to further hamper energy reliability with the early retirement of dependable coal and natural gas plants. EV mandates solidified by the EPA’s tailpipe rule to regulate vehicle emissions have negatively impacted car dealerships, motorists, and auto manufacturers.
The IRA subsidies and tax incentives not only fall on the backs of taxpayers but distort markets by skewing them toward certain technologies, impacting price dynamics, and affecting investment decisions. On top of increased tax burdens, many consumers are seeing their electricity prices skyrocket. Energy poverty is at an all-time high, especially within minority communities.
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Forcing an energy transition limits choices, stifles competition, raises costs, creates scarcity and shortfalls, and interferes with markets. America is in need of a reset that will unleash abundant, reliable, and affordable energy to meet current and future demands.
Hydrocarbons (petroleum-based products) have been and will continue to be in the foreseeable future a mainstay, providing roughly 82 percent of total U.S. energy consumption. No amount of legislation is going to change that. An all-of-the-above strategy means maximizing production for oil and natural gas which predominantly fuel our transportation, industrial, and electricity sectors; all are incredibly vital to economic growth and create an environment where everyone can thrive.
Becoming a net energy exporter in 2019 and more recently the top producer of oil and natural gas have positioned the U.S. as an energy superpower. No longer prey to global calamities or malicious forays by bad actors, such as the 1973 Oil Embargo, having energy independence ensures resilience and stability. We need to build on this prowess.
The rapid deployment of renewable energy over the last four years has not replaced fossil fuels like anticipated, but merely resulted in an increase in total energy consumption. Intermittent wind and solar, with extremely low capacity factors, will not sufficiently meet our growing needs. Supplemental support from these sources is warranted, but not adoption on a wide scale.
Incorporating any level of renewable energy and EV battery technologies must include mining and processing the required critical minerals here at home rather than abroad. Tapping into our vast supplies of lithium, for example, would minimize our reliance on foreign nations and enhance our national security. As it currently stands, China dominates this sphere, keeping every other nation at their mercy. This must change.
It would be prudent to also capitalize on the renewed interest in nuclear energy. Previously waning in popularity, nuclear is enjoying a comeback as multiple big tech companies are seizing an opportunity to utilize its ability to power massive infrastructure projects with low carbon emissions. Considered one of the cleanest and most reliable sources available, nuclear will be critical in meeting future energy demands and decarbonization goals.
The U.S. has effectively demonstrated that an increase in energy production and a reduction in greenhouse gas emissions are not mutually exclusive. We have led the world in curbing emissions, due in large part to innovations and new technologies facilitated by free market principles. Fracking, for instance, enabled extensive natural gas production which replaced a significant portion of emissions-heavy coal.
As the dominant global energy player with an all-of-the-above strategy, the U.S. is poised to not only provide for our needs at home but supply several allies abroad. Economic prosperity is intertwined with robust energy policies that reduce regulations and allow the market to flourish. Blessed with vast resources, America can responsibly harness all forms for the benefit of consumers.
Kristen Walker is a policy analyst for the American Consumer Institute, a nonprofit education and research organization. For more information about the Institute, visit www.theamericanconsumer.org or follow us on Twitter @ConsumerPal.
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