Trump's 'energy czar' pick means US renewables might still be part of the plan

It looks like renewables could be part of President-elect Donald Trump’s plan to make the US the dominant global energy producer after all, despite his disdain for wind power and skepticism over whether grid-scale solar makes economic sense for the country.

“We will DRILL, BABY, DRILL, expand ALL forms of energy production to grow our economy, and create good-paying jobs,” Trump said in a Friday statement nominating North Dakota Governor Doug Burgum, a Republican, as his secretary of interior.

The US renewable energy industry will be hoping the 'ALL' is as significant as the first set of characteristic Trump capital letters.

If he wins Senate approval, Burgum will oversee an executive department responsible for management and conservation of 75% of federal public lands and natural resources including some of the best untapped solar and wind resource.

Trump campaigned for a second and final four-year term pledging to ramp fossil energy production on federal lands where he wants to ease and speed up permitting for expansion of electric transmission infrastructure. If that happens, this would also benefit development of renewable energy generation and enable delivery to distant markets.

Burgum will chair Trump’s National Energy Council, a body created by his senior advisers whose brief will be to coordinate federal government actions and policies for the purpose of achieving “energy dominance,” a Trump buzzword for self-sufficiency at home with surplus fossil fuels available for export to allied nations.

The council “will consist of all departments and agencies involved in the permitting, production, generation, distribution, regulation, transportation, of ALL forms of American energy,” said Trump in his announcement.

It takes the concept of a “whole-of-government” approach used by the last two Democratic administrations of Joe Biden, who leaves office on 20 January, and Barack Obama in 2009-2017, to a formal, institutional level for alignment and execution of energy policy.

“This council will oversee the path to US ENERGY DOMINANCE by cutting red tape, enhancing private sector investments across all sectors of the economy, and by focusing on INNOVATION over longstanding, but totally unnecessary, regulation,” said Trump.

Underscoring the body’s future administrative and policymaking importance, Trump said Burgum would also occupy a seat on his National Security Council, a US president’s main forum for consideration of national security, foreign policy, and military matters.

Exactly how renewables would fit in Trump’s ambitions for US energy dominance is a question with no easy answers for Burgum, who supports the mainstream Republican position that the US should pursue an “all-of-the-above” basket of established technologies.

As governor, Burgum oversaw North Dakota’s rise to number three among states for oil production, seventh for coal, and 10th for ethanol and wind. North Dakota is mainly rural with a population of about 800,000 and generates 36% of its electric power from wind.

Burgum, who the national media is already calling an “energy czar,” will have his hands full trying to get the sprawling federal bureaucracy to march in the same direction to comply with Trump’s dictates.

Wright, a conservative oil hardliner with no prior political experience, claims the energy transition and climate crisis are nothing more but “alarmist marketing terms” and sees wind and solar expansion as an expensive distraction.

Still, he has worked in geothermal and solar in his professional career and also has experience in nuclear, giving him a broader energy perspective than political appointees.

Interestingly, Wright believes the fastest and most economical path to meaningful decarbonisation globally is substituting coal with natural gas.

To what extent Wright would counterbalance Burgum is already subject to clean energy industry speculation.

Trump has made it known privately and in public that he respects Burgum for his administrative capability as governor and business acumen, noting he was a successful real estate development and accounting software entrepreneur before turning to politics.

By May, Trump was eyeing Burgum for a senior post in his potential administration, remarking that he “probably knows more about energy than anybody I know.” Trump added, “So, get ready for something, OK? Just get ready.”

Burgum has been tasked by Trump to “undo the damage done by the Democrats to our nation’s electrical grid, by dramatically increasing baseload power.”

In his announcement, Trump asserted that more baseload power will cut the cost of electrical bills that “continue to skyrocket” for ratepayers and small businesses under Biden and prevent the “devastation” of blackouts and brownouts.

Average residential electricity costs in the last four years rose about 24%, outpacing 20% consumer inflation, according to federal data.

Trump apparently sees natural gas, which provided 43% of utility-scale electricity generation in 2023, as the main source of new supply. While the US has abundant reserves, overreliance could leave some regions of the country too exposed to price volatility and/or potential supply disruptions.

The question is whether enough natural gas can be brought online to keep up with national power demand growth that some private analysts forecast could surge six-fold in the next 20 years. An advantage renewables have is they can be brought online faster than alternatives.

Coal will not play the prominent role he initially envisioned with electric utilities moving away for cost and environmental reasons, but newer plants will remain in operation. Fuel oil is a minor player mainly in New England.

Trump likes nuclear, but large power plants are costly and time consuming to permit and construct, and often face opposition from environmentalists and elected left-leaning officials in some states. Restarting facilities shuttered in prior decades is also expensive and not always feasible.

He is supportive of small modular reactors, but development is in the early stages and not expected to become cost-competitive and commercially available until next decade.

That leaves wind and solar. While not baseload power, they have attracted tens of billions of dollars in ongoing and proposed generation and manufacturing supply chain investments.

How Trump will view those investments is unclear, and is a source of private sector uncertainty here and among Asian and European companies who played an important role in driving the US energy transition under Biden.

As National Energy Council chair, Burgum could play an influential role in reminding Trump to make good on expansion of all forms of energy production for economic and jobs growth.