Energy Stocks

Trump Reverses Obama-Era Climate Regulation, Pushes Coal Agenda

Last week, U.S. presenters spoke at the 24th Conference of the Parties to the United Nations Framework Convention on Climate Change (COP24) in Poland. However, they weren’t promoting renewable energy.

Far from it… They were pitching coal.

Coal and other fossil fuels played an integral part in energy generation and economic development during the 20th century. But science has increasingly pointed to them as big contributors to global warming.

It’s a problem that is being addressed through the increased use of renewable energy and energy storage.

Unsurprisingly, coal is largely being phased out of the world’s energy mix. But not if the U.S. has anything to say about it.

The Trump administration says nothing will get in the way of building new coal-fired power plants here in the U.S. To do so, Trump is rolling back Obama-era climate change regulation.

Specifically, he’s removing existing limits on carbon dioxide emissions. The current limit is 1,400 pounds of carbon dioxide per megawatt-hour of electricity generated. That limit will be increased to 1,900 pounds for new plants.

Bill Wehrum, assistant administrator for the Office of Air and Radiation, said, “U.S. coal-fired power will be a part of our energy future and our revised standards will ensure that the emissions profiles of new plants continue to improve.”

Still, it’s hard to fathom that anyone believes the “clean coal” myth at this point.

Janet McCabe, formerly of the Office of Air and Radiation under the Obama administration, called Trump’s move a “complete disregard for public health and the health of the planet.”

Mary Anne Hitt, senior director of Sierra Club’s Beyond Coal campaign, called the proposal “nothing more than another thoughtless attempt by the Trump administration to prop up their backwards and false narrative about reviving coal at the expense of science, public safety and reality.”

I’m not against coal per se. But I am concerned about the planet. We need to strive to leave it in better shape than we found it.

I get what Trump is trying to do. One of his campaign promises was to coal miners and mine owners. He promised to revive the industry.

But cheap natural gas and renewables have continually thrown a wrench in his plans.

Additionally, utilities are done building new coal plants. They are too expensive, take too long to build and produce too many pollutants.

Over the last eight years, utilities have shuttered or announced plans to close more than 630 coal-fired power plants. That represents 40% of the entire U.S. coal-fired power-generating fleet.

Natural gas-fired power plants are cleaner and cheaper and can be constructed in 12 to 18 months.

The market is pushing us toward greater use of these energy sources, as well as renewables and energy storage. The federal government should listen.

Eventually, the market will prevail. While coal still powers around 30% of U.S. electricity, I expect that number will approach zero in my lifetime.

And the world will be a better place for it.

Good investing,