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As Trump 2.0 Begins, the Case for Optimism on Climate



Today is not a day for optimism in the climate world. Indeed, following President Trump’s promise during his inaugural address a short time ago to “Drill, baby, drill,” the White House press office sent its first missive from its new occupants at 1:45pm. In part, it reads as follows:


“The President will unleash American energy by ending Biden’s policies of climate extremism, streamlining permitting, and reviewing for rescission all regulations that impose undue burdens on energy production and use, including mining and processing of non-fuel minerals. 


“President Trump’s energy actions empower consumer choice in vehicles, showerheads, toilets, washing machines, lightbulbs and dishwashers…President Trump’s energy policies will end leasing to massive wind farms that degrade our natural landscapes and fail to serve American energy consumers. President Trump will withdraw from the Paris Climate Accord.”


Allow me, though, to make the case for why things may not backslide as much as we fear, and why ironically some meaningful progress on federal policy might even be possible, if not likely. 


Narrow Margins on Capitol Hill Mean Big Challenges for GOP

When President Obama took office in 2009, my former boss, Senate Majority Leader Harry Reid, faced immense pressure to deliver on the new president’s sweeping mandate. Obama had secured 365 electoral votes and helped Democrats win 257 House seats and 60 in the Senate—a filibuster-proof majority that sent Democratic expectations sky-high. Yet Reid often found himself just shy of the crucial 60 votes, hampered by a protracted recount in Minnesota’s Senate race and Senator Ted Kennedy’s extended absences due to his battle with brain cancer.


Now compare that to today. Trump won 312 electoral votes, but his party holds just 219 seats in the House—the slimmest majority for either party in nearly a century. Senate Republicans fare slightly better with 53 seats, but that’s still far from the numbers needed to push through their agenda unimpeded. Delivering on Trump’s priorities will be anything but straightforward.


Speaker Mike Johnson and Senate Majority Leader John Thune are already at odds over how to move Trump’s agenda forward. Johnson wants to pass one sweeping bill through the budget reconciliation process, while Thune prefers to push an initial package in the coming weeks and save a second reconciliation bill for later in the year, focused on tax cuts. And this is the easy part. The real drama will begin when House members realize they hold the kind of leverage Senator Joe Manchin wielded during the Inflation Reduction Act negotiations in 2021 and 2022. Any one of them could cast the deciding vote on a major piece of Trump’s agenda. That dynamic gives me hope that key IRA provisions—like tax credits for projects already underway—will survive. After all, the jobs and economic development spurred by these investments are heavily concentrated in red states like Georgia, North Carolina, and Arizona.


The worst-case scenario is that partisanship dominates, and even moderate House members desperate to survive the 2026 midterms feel compelled to fall in line with Trump early in the new President’s term. The longer they delay moving major legislation, the weaker Trump’s position will become, particularly if he gets bogged down in petty grievances and distractions that alienate the broader public. As his approval rating inevitably dips—a pattern for most presidents after taking office—it will become increasingly difficult to strong-arm lawmakers into backing his priorities. That’s why Thune’s approach is the savvier play. He knows political capital is fleeting and recognizes the need to act decisively while Trump still has a stronghold on the party.


Trump Will Quickly Confront Conflicting Priorities 

Trump’s vow to position the United States as a leader in AI and create a favorable policy environment for the energy-intensive cryptocurrency industry collides with a stark reality: the nation’s energy supply—across all sources—is insufficient to meet the surging demand fueled by these sectors. Unsurprisingly, Trump is already targeting wind projects (lest they raise cancer rates), while signaling a broader rollback of renewable energy initiatives that could further strain energy availability.


At the same time, Trump’s overarching desire to “beat China” faces significant challenges. China dominates the critical mineral supply chain and leads the world in manufacturing electric vehicles. By scrapping EV incentives and halting investments in battery factories and critical mineral processing enabled by the IRA, Trump risks entrenching America’s lagging position in the global clean energy race, ceding even more ground to China.


End of Chevron Deference Could Work Against Trump Admin

The Supreme Court’s June 2024 decision to overturn the Chevron Doctrine has reshaped the regulatory landscape, ending decades of judicial deference to federal agencies’ interpretations of ambiguous laws. This shift means administrations can no longer rely on broad or creative readings of statutes to advance their agendas. Ironically, the Court that Trump helped shape may now pose obstacles to his efforts to roll back energy and environmental regulations. While existing rules may be easier to reverse, the creation of new ones will face heightened legal scrutiny, slowing his administration’s ability to implement sweeping changes. Anticipating these challenges, congressional Republicans will likely prioritize crafting legislation with unambiguous language to minimize the risk of legal challenges stemming from the Court’s decision.


Permitting Reform Remains on the Table

Bipartisan permitting reform has stalled in the last two Congresses, but the urgency for reform has only grown. Across the country, too many clean energy projects critical to achieving net-zero targets and mitigating climate change remain stuck in bureaucratic gridlock. A well-crafted reform package offers something for everyone: conservatives who want to streamline fossil fuel development and progressives who recognize that a clean energy transformation requires faster approval timelines. While President Trump is likely to take executive action on permitting, substantive progress will require legislation. As I wrote last month, I believe bipartisan permitting reform is possible in 2025.


Geothermal, Long Forgotten, Gains Bipartisan Momentum

Among renewable energy sources, geothermal stands out as uniquely positioned to benefit from a favorable federal policy landscape over the next four years. Its bipartisan appeal is clear: Republicans are drawn to the industry’s oil and gas roots, while Democrats champion its environmental benefits, particularly with new technologies that avoid fracking.


Trump’s nomination of Chris Wright as Secretary of Energy has only bolstered optimism for geothermal’s future. Wright’s private sector investments in advanced geothermal technologies suggest he could bring a supportive approach to the role. Even the oil and gas industry’s strong influence with Trump could work in geothermal’s favor, as many of these companies are already backing the cutting-edge geothermal startups driving innovation today.


The Inflation Reduction Act’s Long Tail

Before leaving office, the Biden administration committed billions of dollars from the Inflation Reduction Act, with agencies like the DOE and EPA working tirelessly since the November election to roll out its transformative programs. These include tax credits, grants, loans, and other incentives designed to accelerate the clean energy transition.


Even with a new administration, much of the IRA’s impact will endure. The private sector is already moving to capitalize on these long-term benefits, and the scale of investments makes them challenging to reverse. Across the country, manufacturing plants for batteries, solar panels, and electric vehicles are breaking ground, with strong support from local communities. According to a Climate Power report, 405 clean energy projects in 152 Republican congressional districts are creating 216,000 jobs and driving nearly $205 billion in investments. For Republican lawmakers, pulling the plug on these clear economic benefits for their constituents would be a tough sell.


The Clean Energy Train Has Left the Station

The clean energy economy is no longer emerging—it’s a cornerstone of U.S. economic growth. Over the past decade, renewable energy sources like wind and solar have become some of the most cost-effective options for electricity generation, driven as much by market forces as by policy.


Even during Trump’s first term, when federal support for clean energy was minimal, the sector continued to grow. Renewable energy supply in the U.S. increased by 15% from 2016 to 2021, with solar capacity more than doubling. The share of electricity generated from renewables rose by 5% during that time, fueled by state-level policies, corporate demand, and falling technology costs. Today, the momentum is even greater, with trillions of dollars flowing into global clean energy and storage investments. It’s nearly certain that by 2028, clean energy supply, generation share, and capacity will reach record highs.

 

Moreover, climate tech is no longer a niche sector. Venture capital and private equity firms are funneling capital into companies developing breakthrough solutions, undeterred by political cycles or changes in leadership. The energy transition has become an unstoppable force reshaping the U.S. and global economies.


While a Trump presidency presents undeniable challenges for climate advocates and clean energy companies, there are many reasons for optimism. The clean energy transition is driven by powerful economic, technological, and societal forces that no single administration can fully derail. Now is the time for climate advocates and clean energy leaders to double down on their efforts.


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