Trump 2.0: Energy dominance and raw materials policy instead of climate protection
- hoffmann58
- Mar 25
- 2 min read
Updated: Apr 1
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Executive summary
The new administration in the United States is placing an unexpectedly strong focus on fossil fuels: It has declared an “energy emergency,” accelerated the approval of permits for new liquefied natural gas terminals and loosened restrictions on oil and gas drilling.
At the same time, it is reducing support for green energies and could dismantle the Inflation Reduction Act (IRA): The only low-carbon energy sources and technologies eligible for funding are nuclear energy, the geothermal energy used for fracking and the latest battery technology.
The announced elimination of climate subsidies and repeal of climate protection regulations will likely slow down the reduction of US emissions in the coming years: Instead of the planned 37 percent, it would only be 25 percent by 2030 compared to the base year 2005. A number of multinational companies are already rethinking their investments in renewable energies and the green technology sector in the US, while numerous government measures are being challenged in court.
The return of the United States to fossil fuels benefits China as the leading superpower in renewable energy technologies and in electric mobility.
The US government is taking an aggressive approach to raw materials, which are important for the energy transformation and for military applications: A sovereign wealth fund will enable access to mineral-rich Greenland and to rare earth minerals in Ukraine through investments in foreign mines and political pressure.
President Donald Trump's declaration that the US was again withdrawing from the Paris Climate Agreement is primarily symbolic, as US energy policy, even under his predecessor, was primarily economically motivated. Furthermore, the US only accounts for approximately 11 percent of global emissions. However, other countries such as Argentina or Indonesia could follow the US example.
The freezing of all US funding for international aid, in particular the dismantling of the United States Agency for International Development (USAID), is also having an impact on the global funding of low-carbon energy. For example, the US is no longer supporting any solar projects in Ukraine or Africa.
Finally, the various tariffs announced by the US are not only creating uncertainty among companies, but also destroying European-American cooperation on climate change, for example on joint measures on the Carbon Border Adjustment Mechanism.
Implications for businesses can be found in the report (Download above)