December 22, 2024

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WoodMac: Republican Control Will Shift US Away From Net Zero

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Alex Kimani

Alex Kimani is a veteran finance writer, investor, engineer and researcher for Safehaven.com. 

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WoodMac: Republican Control Will Shift US Away From Net Zero

Energy analytics firm Wood Mackenzie has reiterated its earlier predictions that the renewable energy sector is likely to come under pressure under a second Trump administration but said that the likelihood of a full repeal of the Inflation Reduction Act (IRA) remains low.

The IRA has supported over US$220 billion in manufacturing investment and much of this has been concentrated in Republican-led states,” said David Brown, Director, Energy Transition Service at Wood Mackenzie in a press release.

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The likelihood of a full IRA repeal is low. However, there could be some amendments to the legislation. Renewables investment could slow, but capacity is set to grow by 243 gigawatts (GW) from 2024-2030 even in our delayed transition scenario.’’

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According to WoodMac, a second Trump presidency could place a huge part of renewable energy investments at risk,  increase carbon emissions by 1 billion tonnes more by 2050 and delay peak fossil fuel demand by 10 years beyond current forecasts, energy analytics firm Wood Mackenzie has predicted.  

WoodMac projects ~$7.7T in overall spending by the U.S. energy sector through 2050 under current policies, a figure that could be cut by $1T under Trump through reduced policy support for low-carbon energy and infrastructure improvements. 

The analysts have predicted that less spending on low-carbon energy could boost demand for natural gas by 6% or 6B cf/day by 2030.

WoodMac says that whereas Trump would lack the power to unilaterally repeal the Inflation Reduction Act (IRA) enacted during the Biden presidency, he could bring changes to environmental rules and executive orders that would roll back many of Biden’s environmental policies. The research firm also projects that the total number of EVs on U.S. roads in 2050 would be 50% lower than under current policies because automakers would likely favor the production of hybrid vehicles over pure electric cars. 

The auto industry has unveiled more than $100 billion in EV investments, with potential to create 100,000 American jobs.

By Alex Kimani for Oilprice.com

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