Five Reasons Why Trump’s Stance on Climate Change Could be Irrelevant

The withdrawal of the United States from the Paris Climate Agreement announced by President Donald Trump on June 2017, was met by worldwide criticisms and expressions of disappointment. World leaders, while expressing their disappointment by the USA’s action, reiterated their commitment to the goals and objectives of the Agreement and expressed their determination to forge ahead with or without USA participation.

In criticizing the withdrawal decision, most reactions centered on the potential costs and benefits from a national perspective. Some critics pointed to the damage to US global leadership that the withdrawal will cause on such a vital international issue, while others pointed to the economic harm that it may inflict on the USA’s green and renewable energy sectors. Some highlighted the opportunity that such action will offer countries like China the reign of global leadership on climate change. Others worried about the potential negative impact on the mitigation and adaptation efforts targeting global warming that stand to suffer because of the USA’s withdrawal of support.

Despite these concerns, a closer scrutiny of the justifications given for the USA’s action reveals that the withdrawal from the Paris Agreement would likely only have a modest impact on the trajectory of global climate. This conclusion is further enforced by the political backdrop of the decision, the drivers for the Paris Agreement, and the outlook for green energy.

The following are five reasons why the USA’s withdrawal may not be as consequential as the pessimists’ fear:

The impact of the Paris Agreement on the US domestic energy market has been negligible: The decline of the US coal industry, cited by President Trump as a primary justification for the withdrawal, has started well before the adoption of the Paris Agreement. The coal industry has been on a challenging path since the 1980s. The growth in coal demand over that decade, while higher than total energy demand, came well below that of other competing sources such as nuclear energy. In the following decade, the 1990s, coal was the only main energy source that failed to grow its market share. Under the Bush Administration from 2000-2008, coal consumption decreased at an average annual rate of -0.1%, followed by a sharp decline at an annual rate of -4.9% over the period 2008-2015, under the Obama Administration (Figure 1).

Source: http://www.bp.com/en/global/corporate/energy-economics/statistical-review-of-world-energy.html

There are several factors that have shaped the above developments besides the environmental concerns about coal emissions of harmful compounds such as sulfur oxides and nitrogen oxides, among other pollutants. Restructuring the power sector and the introduction of competition in the generation sub-sector, coupled with moderating growth in demand due to energy conservation efforts, had raised the risk levels of large capital investments required by coal plants. Meanwhile, the introduction of high efficiency combined cycle gas turbines (CCGT), with shorter construction periods and lower capital requirements, presented a strong competitor to coal and stimulated the demand for natural gas. The subsequent development of the smart grid and the introduction of renewable energy enforced this trend by creating the need for load following generation due to the uncertainty of wind and solar availability. This need was best met by the more flexible gas turbines.

However, the sharp decline in coal consumption over the past eight years is primarily due to the increase in supply of shale gas and renewables at competitive prices. Both developments, while coinciding with President Obama’s term in office, occurred before the Paris Agreement and the enactment of the Clean Power Plan. Consequently, it is highly unlikely that reversing Obama’s climate change policies will help reverse the declining fortunes of the US coal industry.

It is unlikely that the US withdrawal will lead others to follow suit and withdraw from the Paris Agreement: It is not expected that the withdrawal of the US will lead to the withdrawal of other substantial signatories to the Agreement. None of the major countries’ acceptance of the Agreement was conditional on the continued presence of the US. This is not to discount however, the importance of US presence as a first world superpower, and more importantly as the second largest carbon emitter.

The unconditional consensus reached in Paris, and lauded as the Climate Conference distinctive achievement, was mainly due to the non-binding and voluntary nature of the Agreement. Almost all national commitments under the Agreement are compatible with the national economic and social development strategies of the signatories, particularly major carbon emitters such as China, India, Russia, and major oil exporters. In other words, no special sacrifices must be made for the soul purpose of meeting the carbon emission targets set in the Paris Accord.

The case of China, the world’s largest carbon emitter, illustrates this point. Urban pollution which reached hazardous levels in recent years has been the main driver behind decreasing China’s heavy reliance on burning coal for power generation. Despite its high reserves of coal, growth in coal consumption has lagged the growth of cleaner alternatives since the 1990s, and notably lost market share over the period 2008-2015 (Figure 2). Nuclear, renewables, and gas fired generations made rapid gains in comparison, thus reducing the rate of growth in coal driven pollution, and carbon emissions.

Source: http://www.bp.com/en/global/corporate/energy-economics/statistical-review-of-world-energy.html

Driven by similar incentives as China, India is diversifying its energy mix by rapidly building renewable, nuclear, and natural gas based power generation capacity. Coal consumption however, is still gaining market share at the expense of mostly imported natural gas (Figure 3). Consequently, carbon emissions are more likely to continue to grow in absolute terms while carbon intensity in economic activity declines for the foreseeable future. For India, the development of nuclear and renewable energy is also strongly motivated by energy security concerns.

Source: http://www.bp.com/en/global/corporate/energy-economics/statistical-review-of-world-energy.html

Even the Russian Federation who stands to lose the most from global climate change induced policies and measures due its substantial fossil fuel energy resources, signed the Paris Agreement. Its stance however, stems from the fact that carbon emissions peaked in the 1990s due to the collapse of the Soviet Union and declined in line with economic activity. The process of economic transition that followed, characterized by fast growth in services and gains in productivity, drastically reduced carbon emissions to well below their peak level. This decline in emissions is credited to Russia’s commitments under the Paris Agreement.

Major oil producers of the Middle East, who share with Russia the apprehension and concern about anti-fossil climate change induced policies, also found it possible to sign on the Paris Agreement. Their stance was consistent with their economic and social development strategies that aim at diversifying their energy mix by exploiting sizable renewable energy resources, especially solar energy, and by introducing nuclear energy. Moreover, planned reductions of energy price subsidies also promised to reduce domestic consumption by supporting energy conservation efforts. These goals, if achieved, are assumed to help these countries meet their commitments under the Paris Agreement. It is yet to be seen however, how the sharp decline in oil prices since 2014 have raised the uncertainty about these goals being achieved within the planned time frame. The economic viability of developing alternative energy sources or undertaking energy conservation measures, which is to free domestically consumed oil for exports, is not assured any more, and may be nil at the present historically low oil prices.

The importance of the Paris Agreement lies mostly in its symbolism, not in its effectiveness: The original goal of the Paris Climate Conference was not to produce a voluntary, non-binding agreement on mitigating and adapting to climate change. Rather, it was to produce a global legally binding treaty to succeed the Kyoto Protocol that was about to expire by the end of 2015. The Kyoto protocol had set mandatory targets for carbon emissions, but only for the developed countries.

This distinction however, was always a point of contention and a cause of disagreement between the developed and the developing world. The former, while not denying its historical responsibility for cumulative carbon emissions, argued that the developing world countries should also be part of any future agreement, because they are major carbon emitters. Meanwhile, developing countries such as India and China argued that curtailment of their emissions will have negative effects on their economic development which is their overriding priority.

The Paris Agreement did not resolve the issue, it was simply a framework for which both groups can declare support without changing their positions. The main cost of this compromise was a weakened instrument of implementation for achieving the required reductions in emissions to keep global temperature rise within two degrees of pre-industrial level.

Symbolically however, The Paris Agreement may be considered a success for achieving unanimous approval of 195 countries. Gaining the US support was also hailed as a success, especially since the US, who did not join the Kyoto Protocol, cannot join a new climate treaty even if the US Administration supported it. A treaty would need to be ratified by the US Congress. The Congress which is controlled by the Republicans who, due to the highly polarized political environment, would not support the Democratic President Obama. A voluntary accord, on the other hand, will not need the approval of Congress and can be approved by executive action.

Furthermore, the Paris Agreement established the Green Climate Fund to assist poor countries in mitigating and adapting to the effects of climate change. The USA’s promised contributions to this fund will be missed, but will not be that difficult for the rest of the world to compensate for.

The Agreement also adopted an instrument to monitor and follow-up on progress in implementation, thus leaving the door open for revising the targets and possibly enacting a global treaty in the future. It also opens the door for future adoption of global cap and trade system in carbon emissions or a comparable global carbon tax.

The sustainability of US membership in the Paris Agreement has always been uncertain: The USA’s withdrawal from the Agreement was not only a possible event, but a very probable one. Any expectation of an opposite outcome would have to factor in the unlikely assumption that the Democratic Party would, at the minimum, control the White House in the medium and longer term. While all the wrath fell on President Trump for withdrawing the US from the Paris Agreement, it is highly likely that any Republican President would have done the same.

Supporting such assessment is the highly polarized politics during the Obama Administration. This polarization intensified with the Republican Party gaining majority in the 2010 mid-term elections. This outcome made it very difficult for president Obama to pass legislation through Congress. The fact that many of the republican newcomers to the Congress were of ultraconservative-climate- change- denying convictions did not help. This in turn has led the president to increasingly rely on executive actions to implement his agenda.

The excessive use of executive actions by the Obama Administration, coupled with a changing political landscape as reflected in the 2010 Elections, further alienated moderate Republicans who may have supported a pro-climate agenda. It is worth recalling that it was Senator John McCain, the Republican candidate for president in the 2008 elections, who called for a national cap and trade system for reducing carbon emissions during his campaign. The issue for most Republicans was not the need to defend the climate, which most in the mainstream have and still support, but strong opposition to Obama, made worse by the latter’s use of executive actions to bypass the Republican-controlled Congress.

One would have assumed that the Paris Agreement has either factored the uncertainty surrounding the sustainability of US membership, or believed that it will be inconceivable for a future US administration to abandon such a vital cause. What has not been anticipated however, is the election of Donald Trump for the presidency of the United States.

Given the long-term nature of climate change objectives, associated agreements and strategies must be sustainable over very long periods of time, and across generations. This can only be possible if national and multilateral commitments are built on solid political, economic and social foundations.

The US green economy is too advanced, well developed, and enjoys strong bipartisan public support: Thanks to the supportive policies of the Obama Administration on the one hand, and the rising public concern about the risks and dangers of global warming on the other hand, the US green economy has been growing at rapid pace. The momentum that it acquired over the past decade is too great to be stopped, let alone reversed. According to the Department of Energy, 133,000 jobs were created in 2015 in the energy efficiency industry alone. Those employed in the solar energy and wind power industries reached 374,000 and 102,000 respectively in 2016.

More importantly, the cost of renewable energy is now at levels it can compete in the market place without much support. This is mainly due to the wide support for green energy at the State level. 29 States plus the District of Columbia already have active renewable energy and energy efficiency mandates. It is ironic that the withdrawal of R&D funding for green energy research may harm the prospects of fossil sources of energy where part of this funding is used for clean energy research such as carbon capture and sequestration.

Complementing the role of the US in defending the climate change agenda will be the support of major US corporations for climate change mitigation, and the legal challenges to the Trump Administration’s deconstruction of Obama’s Clean Power Plan.

While Trump’s anti-environment and anti-climate policies may appease his ultra-right mentors and supporters, such policies do not have the support of the great majority of the American people, Democrats and Republicans alike. A quite informative survey conducted in 2017, just prior to Trump’s announcement of withdrawal from the Paris Accord, by the National Surveys on Energy and Environment (NSEE), has found the following:

• “A majority (66%) of Americans, 77% of Democrats and 51% of Republicans, believe that it is the State responsibility to address the issue of global warming in the absence of federal action. Only 48% of them believed the same in 2013.

• The ratio of Americans believing that climate change is occurring rose from 64% in 2013 to 70% in 2017.

• There is very high support for State level policies aimed at reducing carbon emissions form the electricity sector. 79% support renewable energy mandates and 81% support energy efficiency mandates. Support to increase the use of renewable energy outside of the context of mandate is even greater; 89% for solar energy and 83% for wind energy.

• Support for renewable energy is high even among those Americans who do not think that there is evidence that the earth is warming, with a majority of this group saying they support adding more solar (74%) and wind (67%) energy in their state.

• A great majority of Americans (81%) including those who do not think climate change is happening say that solar and wind energy create jobs.”

Such evidence would raise great doubts about the ability of the Trump Administration to derail the global climate agenda, and the sustainability of its anti-climate measures.

KZ

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