Energy Issues
The United States is the world’s largest producer of oil (although it only ranks 9th in terms of reserves, roughly one quarter of top ranked Venezuela). The US also holds the largest share of global coal reserves (just over 20%). In this sense it is not surprising that the Trump administration considers that fossil fuels should remain the ‘backbone’ of energy generation. Likewise, China - which lacks significant oil reserves - continues to invest in new coal plants given their substantial coal reserves, some 13% of global reserves.
The different approach to renewable energy, however, is startling. China has embraced hydroelectric, solar and wind power generation while close to half of passenger vehicles sold are either outright EVs or hybrid EVs.
The White House declared a national “energy emergency” in January, taking aim at high energy prices and a lack of affordable power. In an earlier daily we covered the enforced closure of the Ørsted’s Revolution Wind LLC in August. The project is a joint venture with Global Infrastructure Partner’s Skyborn Renewables and was approved by the Biden Administration.
The project was 80% complete with 45 of 65 planned wind turbines installed. On 3 November a Federal Judge ruled that Ørsted and its partner could resume construction. We will see how the Trump administration reacts.
This is not the only strange decision taken by the Trump administration. A coal plant in western Michigan was due to be retired a few months ago. The company that owns and runs it had concluded that consumers would be better served by a mix of other energy sources. The administration barred the plant from closure. The operator has been spending almost $1mn per day to keep it running.
Who bears the cost of running this inefficient plant? Consumers across the Midwest of America. All of this is occurring as the construction and operation of data centres shift overall electricity demand upward.
A 2022 study by the Department of Energy found that more than 300 existing and retired coal plants could be turned into advanced nuclear power plants. The coal plants are already connected to the electricity grid and some of the skills needed to operate nuclear plants are similar, thereby possibly creating job opportunities for existing and former employees.
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