Trump policies would put US at a ‘competitive disadvantage’, warns clean energy boss

Good morning and welcome back to Energy Source, coming to you from New York, where we’re nearing the end of a jam-packed Climate Week. The sprawling event is expected to overshadow COP29 as attendees opt to travel to New York over the UN climate summit, which will be held this year in Azerbaijan.

The prospect of a Donald Trump victory in November’s US election has clouded this week’s gathering. The former president has dismissed the threat of climate change, slammed the Biden tax credits for renewable energy and vowed to “drill, baby, drill” to bring down energy prices. 

In today’s Energy Source, we sit down with Andrés Gluski, chief executive of AES, one of the country’s largest renewables developers, to talk about what a Trump presidency could mean for the US energy sector’s competitiveness. 

Thanks for reading,

Amanda 

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AES chief warns over Trump’s ‘terrible’ industrial policy

Former president Donald Trump’s promise to expand tariffs on Chinese imports and get rid of federal green subsidies would put the US at a “big competitive disadvantage”, warns AES, one of the country’s largest renewable energy developers. 

“If we raise tariffs and take away the subsidies, this would put the United States at a big competitive disadvantage,” Andrés Gluski, chief executive of AES, told Energy Source, without naming the former president. “I think it would be a terrible policy, given the AI revolution, data centres and the states reindustrialising.” 

Gluski’s remarks add to a chorus of warnings from green tech leaders that a second Trump presidency could slow down the energy transition and undermine the country’s effort to become a renewable energy superpower that can rival China and handle the surging power requirements of the data centres underpinning AI.

On the campaign trail, Trump has vowed to pull back spending on President Joe Biden’s Inflation Reduction Act. The landmark industrial policy includes hundreds of billions of dollars in subsidies to speed up the deployment of renewable energy and the buildout of a domestic supply chain for decarbonisation technologies. 

To spur US manufacturing, Trump has proposed a “new American industrialism” centred on tax reductions and up to 20 per cent tariffs on all imports, with even higher levies on goods from China, the dominant producer of the world’s clean tech components.

Kelly Speakes-Backman, a former energy official in the Biden administration and executive vice-president at Invenergy, the country’s largest private renewables developer, said the Trump tariffs would be “detrimental for the American people”. 

“People want clean energy, so we will find a way. But it may well be that energy is more expensive for consumers, and it may not be at the pace to keep up with the demand that’s growing,” Speakes-Backman told ES.

The Clean Investment Monitor, a collaboration between Rhodium Group and MIT, estimates that manufacturing investment in clean tech has more than quadrupled in the two years following the IRA’s enactment, while investments in clean energy deployment have grown 43 per cent.

The fossil fuel industry, alarmed by restrictions on drilling and a freeze on new liquefied natural gas permits under Biden, has cheered Trump’s policies. The former president has courted oil bosses and received about $14mn from the fossil fuels industry, according to OpenSecrets, which tracks campaign financing.

“Our industry has the opportunity to do some really amazing things, if we had an administration that would unleash our potential rather than restrict it,” Toby Rice, chief executive of EQT, one of the largest US gas producers, told ES at a Climate Week event. 

As president, Trump relaxed emissions standards and restrictions on fossil fuel production, raised tariffs on clean energy products, threatened to kill federal support for electric vehicles and pulled out of the Paris climate agreement. 

Nevertheless, the country’s renewables buildout ploughed forward. Wind capacity grew 46 per cent during his term, while solar capacity more than doubled, according to data from the Energy Information Administration. The Trump administration eventually renewed tax credits for solar and wind projects and EVs.

Some clean energy executives doubt that Trump can do much in a second term to slow the energy transition given the declining costs of clean energy and the fact that the vast majority of the IRA’s projects are headed to Republican districts. Several Republican members of Congress have already urged House Speaker Mike Johnson not to undo the IRA’s tax credits.

“You can remove yourself from [the Paris Agreement]. You can remove parts of your legislation that may continue to drive emissions northward, but you’re still going to be captured by international government organisations that will conform to the decarbonising world,” said Matthew Bell, global climate change and sustainability services leader at consultancy EY. 

“All it will end up doing is create an uncompetitive marketplace for the US and make [the country] less attractive on the global stage. It’s hard to believe that that would actually be an outcome,” Bell said. (Amanda Chu and Alexandra White)

Job moves

• Trafigura has appointed Richard Holtum as chief executive, succeeding Jeremy Weir. His appointment comes at a moment of transition for Trafigura, one of the world’s largest commodity traders, as it expands into new areas such as power and renewables. 

• Sasha Mackler is joining ExxonMobil as global head of strategic policy of its low-carbon solutions division. Mackler joins from the Bipartisan Policy Center, where he served as executive director of its energy programme.

• The Global Wind Energy Council has appointed Rebecca Williams as deputy chief executive and Stewart Mullin as chief industry officer of the industry group.

• Shameek Konar, former head of Pilot, has been tapped to lead Ara Energy Decarbonization, the private equity firm’s new decarbonisation arm.

• Anne Hawke, senior press secretary at the Natural Resources Defense Council, is joining the US Department of the Interior as deputy communications director.

• Paul Dobson will serve as chief financial officer of EVGo, a US charging business. Dobson joins from Ballard Power Systems.

Power Points

Energy Source is written and edited by Jamie Smyth, Myles McCormick, Amanda Chu, Tom Wilson and Malcolm Moore, with support from the FT’s global team of reporters. Reach us at energy.source@ft.com and follow us on X at @FTEnergy. Catch up on past editions of the newsletter here.