Transition 2025 Series: The Future of U.S. Climate and Energy Policy

Panelists discuss the future of climate and energy policy under the new Trump administration, examining lessons from President Trump’s previous term, anticipated shifts from the policies of the Biden administration, and the trajectory of U.S. energy industries, including oil, solar, and wind, and natural gas.

This meeting is part of CFR’s Transition 2025 series, which examines the major foreign policy issues confronting the Trump administration.

WORLAND: OK. Well, good afternoon, everyone. Welcome. My name is Justin Worland. I am a senior correspondent at Time where I write about climate and energy. This meeting is on “The Future of U.S. Climate and Energy Policy,” part of the transition—CFR’s Transition 2025 Series, which examines all major foreign policy issues facing the new administration. So much has happened in the last month and a half, and so normally I might say we’re going to dig into all of that but I think we’re going to dig into a small fraction of that with this really great panel.

And so going across the stage, we have Alice Hill, who is the David M. Rubenstein senior fellow for energy and the environment at the Council on Foreign Relations. And I should say, all these people have very long resumes. I’m just going to read one or two things from each of them. And then next we have Michael Catanzaro, who’s the CEO of CGCN Group and was special assistant to the president for domestic energy and environmental policy at the White House National Economic Council from 2017 to 2018. And then finally on stage we have Drew Bond, who is the president and CEO of C3 Solutions, former senior advisor at the U.S. Department of Energy, 2007 to 2008. And then we have joining virtually David Hayes—we can see David on the far end there—who’s a professor of practice at the Doerr School of Sustainability, at Stanford Law School. Former special assistant to the president for climate policy from 2021 to 2022.

I think you heard the housekeeping at the top, but we’re going to have a thirty-minute moderated discussion, maybe a little longer, then we’re going to go to the audience for questions. So please be thinking of questions. And as a reminder, this event is on the record. So opening question, I think, just to get us started, to everyone. Obviously President Trump entered office with a lot of bold policy declarations, maneuvers, declared an energy emergency, pulled the U.S. out of the Paris Agreement. Last night during the joint address to Congress he declared an end to the “green new scam.” So there’s a lot happening but just to sort of set the stage, how do you all separate the signal from the noise amid all of this? And then, what is the signal that you—that emerges for each of you out of everything that’s happening? And we can just go across the line for this one.

HILL: Well, we are seeing a lot of activity. And sometimes it’s hard to discern from that activity what the path is. I think there are a couple of very clear things. The U.S. is not going to be a player in the international arena on climate. And because it’s not going to be a player, that probably has very significant consequences for the amount of carbon that will enter into the atmosphere. We’re the largest historical emitter, and certainly the second-largest emitter now. And what we do matters, given that we are the world’s largest producer of oil and the largest exporter of natural gas. So we’ll see a turnback, I think, on global efforts to cut pollution around the atmosphere. So that’s not noise. That, I think, is going to happen. And, directly as a result of that, the climate will—temperatures will continue to rise and we will see far greater disasters, which will have knock-on effects for national security, migration, and economic growth.

The noise is really what we saw last night. What will the tariffs mean for this push for a drill, baby, drill? What will we see in terms of decisions made for things that we don’t think that would be caught in this sweep, but firefighting capacity, for example, in a hotter world? So there are lots of changes taking place. Hard to keep up for everyone. And then, on top of the decisions that are announced, they’re the reversals of the decisions, which means that you may not be accurate at every moment. But I think it’s clear that the world, as a result of President Trump’s decision, is taking a step back on cutting its emissions.

CATANZARO: Well, thanks. It’s great to be here. Yeah, certainly a lot of activity. It’s been tough to keep up with. I will say that I feel like in this country, you know, if you’re in business, you’re trying to make, you know, investments over the long term, which we know in the energy sector that that’s what they do, particularly if you’re trying to, say, build power plants or other things that, you know, require a lot of capital investment and planning. It’s really tough, because we’re now at a point—we’ve been at this point, I think, for some time, where Congress is basically in a back seat. Congress will take up, you know, the president’s sort of one or two top legislative priorities, pass those, and then basically get off the playing field. But for the most part, businesses have to deal with regulations of one sort or another, and policies coming out of the executive branch.

And what we have now is a system of governance whereby you have one administration that comes in, one party, and they do a whole bunch of things. And they usually look backward and they try to figure out what came before us. If it was a different party, different administration from a different party, then we’re going to try to undo everything that they did as quickly as we possibly can, and then move on to the more affirmative aspects of our agenda. That’s what President Biden did when he looked back in the first term of President Trump. It’s what President Trump is doing right now in looking back at four years of President Biden. So what you get then is these early stage executive orders.

And executive orders serve a couple of functions. One, they’re messaging tools that are good in terms of a president demonstrating to the public that you’re taking quick action, you’re trying to follow through on campaign promises. They’re also good internally for executive branch personnel to understand what it is they’re supposed to be doing, when they’re supposed to be doing it by, what the framework is for decision making. But they can’t change statutes. And that’s why they can be taken off the books as quickly as they can be put on the books. And so where we are now is executive orders seem to be signed almost on an hourly basis, but at the end of the day what really matters is the policy implementation and how all that plays out.

And you can have a lot of rhetoric, you can level a lot of activity, and a lot of noise, but at the end of the day when you look at the agencies they got to go through complex, time-consuming processes under the Administrative Procedure Act and other statutes. And that takes time. And I know the president declared an energy emergency using his executive order authority under the National Emergencies Act. And that may try to move some things along faster. But I’m not sure that it can, at the end of the day, because a number of those authorities do take time to effectuate. We’re going to have lawsuits and litigation.

And so as much as I think the administration wants to move forward as quickly as they possibly can and show bold action as quickly as they can, and they will try to do it, there are obstacles built into the system that only Congress, I think, can really remove, or change, or streamline in order to meet the challenges that we face today, whether it’s climate, whether it’s energy resiliency, grid reliability, new technology, innovation. It can’t be all solved by any one administration or series of administrations. As I say, we’ve got this pendulum that swings back and forth and so it’s very hard to maintain that sort of true north right down the middle.

How can we plan over the long term for the twenty-first century so that America can win this energy race that we’re in with—particularly with China? AI is a huge issue. We all know that. So huge, huge challenges, but doing this just by presidential diktat or doing this just through the regulatory apparatus I don’t think is going to be enough. You got to have both executive will and authority combined with congressional will and authority, particularly through legislation. So we’ll see how this plays out. But really, at the end of the day, Congress has to step up to make some of the changes that I think the president wants to stick over time. So we’ll see how it plays out.

BOND: Yeah. I mean, I’d say there’s the noise and then there’s reality. And the noise is, as Alice alluded to, you know, that this president and this Congress is not leaning into climate. And they’re not leaning into climate in terms of the agenda, but I will say the reality is I think we’re in a place where we can actually reduce greenhouse gas emissions faster than we’ve ever done before. We did it with natural gas, not to save the climate but because the economic opportunity existed. And so I think under this administration, whether Trump wants to or not—you know, currently, he’s—the answer is not. He’s not trying to be the next great climate president. But he, in fact, could be.

If we take this national emergency order and these executive orders to really reduce regulations, I mean, I think we can all agree that the system, as it was previously, wasn’t working. We are not able to build fast enough. And when I read that the national energy emergency, while the top-line narrative in the media was all about oil and gas and drill, baby, drill, when you read the actual language of that it’s all about infrastructure. It’s all about, really, more wires and how do we build faster? So, you know, I am an eternal optimist. I look under this next four years and think we’ve got tremendous opportunity to not only build more and invest more in the United States, but also do it in a way that is cleaner and cleaner over time.

I look at Chris Wright being the secretary of energy, someone that knows energy, knows geology, knows science, knows business. And he, together with, you know, Secretary Burgum and secretary, I guess, director of the EPA Lee Zeldin, together with the environmental task force that’s being created, like, I just think there’s a lot of momentum. I don’t disagree with Mike. At the end of the day, Congress has to move. And maybe with Trump having the authority that he has, particularly with this Congress, Congress will move perhaps faster than they have in the past.

WORLAND: We’re going to pull on this thread of President Trump as an inadvertent climate leader. (Laughs.) So maybe in a bit. But, OK, so David, over to you.

HAYES: Thanks. So there’s certainly a lot of noise. (Laughs.) And it is difficult to know what’s noise and what’s real. And I hope that Drew is right, but I’m not sure. And there are some things that are happening now that are not noise that are significant. And Alice mentioned withdrawing from Paris, for example. That’s not just a question of a headline. It is going to take the United States out of the global discussion around what to do about this existential crisis. I also would say that some of the early moves that also provide headlines are not noise. And I’m thinking in particular of the massive firings that are happening in some of the agencies that are super important in terms of addressing climate and addressing energy. We can talk about this more later, but obviously NOAA, for example, and their leading-edge science, their ability to address and anticipate major climate impacts, et cetera, we’re losing muscle there. We’re losing muscle in agencies that are doing permitting for important infrastructure projects, for example.

And I am concerned, and we’ll talk about this, I think, in a second, Justin, when we talk—perhaps we talk about the emergency order. I’m concerned that that the message that comes through on the emergency order for energy, in removing solar energy and—solar, wind, and storage as a domestic energy resource that deserves priority, is going to have ramifications. And we’re already seeing it. We’re seeing stoppage of funding to clean energy projects. And, you know, as Drew suggested, there’s no reason why you have to conflate a reluctance to lean in on climate, as he put it, with stopping clean energy, which is, on its own merits, as what has become the cheapest new energy source that is proving out as very popular. Almost all of the new energy coming on the grid is clean energy. Having that clean energy now conflated with climate, I think, is a very unfortunate and dangerous, and needlessly unfortunate, situation. But perhaps that that that conflation will recede. But I’m concerned that it may not.

WORLAND: Well, thank you, David. And I think—so, let’s—yeah, let’s pull on this emergency executive order, the threat of this, a little bit. I mean, maybe just to start, how big of a deal is this? I mean, where do you see this actually unlocking new authorities? Where do you see this sort of falling short, maybe getting litigated such that it doesn’t matter? And then, how do you see those authorities being put to work? I mean, maybe, I guess, Drew, would be good to hear from you how they might be put to work in a way that’s positive, especially considering, as David said, solar and wind are excluded. And then, David, maybe you can respond to that, perhaps, offer, you know, a little push back if you feel that’s appropriate.

BOND: Yeah. I mean, I think, again, energy—if you look at the executive order, most of it is about electricity, more than liquid fuels. And so, you know, we need wires. We need transmission. We need distribution. We need resiliency of these infrastructure. And so that is an area where, you know, if nothing else, it’s a top-line message to FERC and to the state agencies that we need to get moving faster. And I think the utilities know this quite well with the advent of the datacenters and how energy hungry AI is. So, you know, I think it’s, in some ways—I know the world was scratching its head when that declaration was issued because we are rich with energy in America. But, again, I think it was more about how do we actually deploy energy faster and have it be more resilient in the United States, given the growth of AI and other energy sources.

I think the opportunities exist specifically within the executive authority on places like National Lab lands and DOD military base lands. And this is where you know, in the past previous administrations had tried to deploy new technologies to prove them at military bases, for instance. I think what the opportunity now with the Trump administration is not to deploy unproven technologies, but to deploy proven technologies at military bases. So here specifically, you know, I’m talking about enhanced geothermal, small modular nuclear is somewhat new on the scene but nuclear is not new, and then even solar plus batteries. So what is—what is off the shelf that we can deploy quickly that is, you know, twenty-four/seven reliable energy? And I would put solar and batteries in that.

Full disclosure, I have a solar company. So before you think I’m anti-renewable, I’m not. You know, I just believe in the fact that every form of energy has a tradeoff and we have to make practical decisions about where those energy best fit. So, you know, if it were me, I think the opportunity is let’s issue a categorical exclusion for all clean energy on all military base and national lab lands. Those two have several things in common. They have a lot of land. They are grid connected. They literally have fences and guards and gates, so they are secure. And they use a lot of energy.

And so you could do that in such a way where the government were actually able to simply issue an RFP and let the industry compete for where those best fit. They’re not going to fit everywhere because some of the labs are so remote that they’re really, you know, not near the loads. But you could put the loads near them with datacenters. And so, you know, that’s the kind of thing that I think this administration could do. And I think, you know, there’s an opportunity just for them to think creatively in those types of ways.

WORLAND: Right. Well, just back on the order—I don’t know, David, if you want to come in—I do think there’s a good point that you raise. I mean, there are a lot of real issues—regulatory issues, permitting issues. I mean is this—is there an opportunity to address some of those things that actually do need to be done through this executive order? And anything else you want to comment on.

HAYES: So, yeah. I think most lawyers, and I’m one, will agree that calling it an emergency does not bring along new legal authorities. That you’ve got to deal with the laws that Congress passed and the authority that the president has inherently Yeah, the Biden administration was asked by the left to declare an energy—a climate emergency. And the Biden administration did not, because they thought it was more of a—would be more of a stunt than real policy.

I agree with the point that there are a lot of important things that need to be done to help facilitate advances in the electricity sector. And to the extent that this emergency declaration and executive order will facilitate that, I’m all in. But a lot of the—again, the authorities are inherent. The categorical exclusions, for example, are already authorized under NEPA and President Biden, use categorical exclusions to facilitate more transmission and other areas. More can be done there. And I hope that it will.

I’ll just say that that excluding solar and wind, in terms of electricity, is a huge problem. And the offshore wind industry in particular is clearly in the target of this administration. And it has been looked at by the northeast, which has the best offshore wind in the world. It’s an American resource that’s amazing. You know, we’re—I’m concerned—I think anyone near the offshore wind energy world is concerned that there’ll be attempts to stop the projects that are already permitted, and in any event stop continued permitting for projects that are in the pipeline. These are multibillion dollar projects with enormous economic benefits to the region and to the country.

WORLAND: Yeah, absolutely. I think if there’s one thing that’s clear, one sector that’s clearly in trouble, you know, as a result of this administration, it’s offshore wind.

Maybe let’s just shift gears completely to talk a little bit about resilience. You know, a lot of the conversation goes quickly to energy policy but, of course, we’re experiencing more and more climate-related disasters. You know, we could talk specifically about FEMA, which President Trump has said he would like the states to take over the role of FEMA. And he’s formed a review council to come up with recommendations on that. So I’d like to ask about that specifically, but then also just to get a sense of how do we think about the way in which this administration is approaching resilience? So what are your concerns? Where are there opportunities, if there are opportunities. We can start with Alice and maybe Michael, I don’t know if you want to jump in on this too.

HILL: Well, resilience is more needed than ever because the hotter we get, the bigger events we have. And just have to look at L.A. and know that even in California, a heavily prepared state that had invested in adaptation, has an adaptation plan, firefighting capabilities, the city’s decimated. And we will see that play out again and again. So you ask about President Trump. I don’t think President Trump has signaled a great interest in resilience. He certainly has removed what I believe was the most significant thing that the federal government had accomplished in resilience, and that is—and it sounds so boring but it saves so much money. It’s a building code that says, you know, for all these communities to get flooded all the time, if you’re going to build back and take federal dollars, taxpayer dollars, to build back, you need to build back resiliently. You need to build back higher. And we know that—so the water can flush through.

And we know that for every dollar spent on a more resilient building code you save $11 in recovery. So more disaster is coming. We know that these areas are already flooding. Let’s just raise up these buildings, if you are going to build back. Well, he killed it right before Harvey struck in 2017, during his first term. He took that flood standard and said, I don’t like it. I think his very first day in office this term he’s killed it again, even though Biden had brought it back. And now he has cut programs that FEMA was running to try to push to the states the need for them to adopt better land use policies as well as building codes. And this is a really disturbing statistic, but 65 percent of communities and counties in the United States do not have a modern building code. So you could be going and buying a house and think, oh, this is perfectly safe, but it was built to no building code, or a building code that’s twenty years old and doesn’t account for higher winds.

So President Trump has said he doesn’t—has pulled back on those programs at FEMA. You’ve seen resignations, to David’s point, of very significant, very experienced leaders at FEMA, who had mitigation—not mitigation of emissions, but mitigation of risk efforts. And FEMA is probably one of the centers of activity for that in the United States. And you’ve seen that states are not necessarily going to have the kind of funding they’ve had in the past. I do have to put a footnote to this. Under President Trump, in his first administration, he signed legislation that gave the most to states ever for resilience, essentially 6 percent of all the disaster spending every year. That’s still in place, as far as I know, but there’s a question how that will be spent. In the recovery from Milton and Helene this administration has decided not to require that things be built back resiliently. That’s what FEMA has required in recent years, and this administration has killed that.

So we’re not going to see, I think, immediately a lot of resilience. I think President Trump’s history as a developer probably makes him a little more hostile to codes. You see on the efficiency codes—that’s a way to get resiliency, by the way, to our energy issues. Better efficiency codes means we use less electricity. So when you have a brown out or you have hot conditions, you don’t have to turn—or turn down electrical usage if people are using less to start with. So there’s hostility there, I think, expressed by this administration, which ultimately will leave us more vulnerable.

I will be concerned—I see Sherri Goodman here. I am concerned for the Department of Defense removing the references to climate. Department of Defense has done some great work of adapting their facilities to climate impacts. Think of Norfolk having to raise all those ports so that—and facilities. To remove those words from consideration, both within FEMA as well as the Department of Defense, means that perhaps as we make choices about where we invest we won’t be investing in a way that keeps us safe, because we’ll build back to what was there before, which will likely get wiped out again.

WORLAND: Well, that’s very, very thorough. Thank you. I don’t know, Michael, if you want to come in on that, or anything on the first topic there. I skipped over you on the emergency order.

CATANZARO: Yeah, on the emergency order, I mean, that that’s tricky for a number of reasons. One is under the National Emergencies Act there is no definition of emergency. Basically, I think it allows the president when he declares it to trigger then all the various emergency authorities that you find in the statutes really here that are relevant for, in this case, I think it’s basically for permitting, as Drew was pointing to. And then when you read through the order, you know, they call out specific emergency authorities, whether it’s, you know, the Clean Water Act Section 404 for the Army Corps of Engineers, or the so-called God Squad that can convene under the Endangered Species Act. But that’s when you do find specific definitions of emergency. And you wonder, you know, when you read them, can they really be applied in certain instances? Maybe with respect to building new infrastructure related to the grid, because I do agree with Drew. When that executive order came together, really, the driving theme was the grid.

And I think that, you know, you all remember from 2017-’18 what happened with FERC, and the NOPR that, you know, Secretary Perry sent over to FERC to try to deal with coal plants shutting down. Whether, you know, the merits of demerits of that put that aside, that was, you know, seven years ago. I think the grid is in a much different spot. And I think we have plenty of evidence to back up, whether it’s NERC, whether it’s the RTOs and ISOs, pointing out that—I hate to use the word “crisis,” but we’re pretty much there. And so that’s what this emergency order is designed to do. But, again, when they call out specific emergency authorities, how are those going to be applied? And when you look at convening the God Squad, you actually have to have a rejected permit in your hand that you can then go back to this committee with and say, hey, committee, this was rejected because we went through a whole long process and we find that we can’t actually abide by the various restrictions that were added to our incidental take permit under the Endangered Species Act.

So all that is to say is, even if the president declares an emergency and then it filters down to the agencies and they use their statutory authorities, there’s still a lot of process you have to go through. So it’s not like you can snap your fingers and say, go ahead and do this, permit this stuff and build it, and there you go. In a few months you’re off to the races. That’s not how it’s going to work. And as I said before, you can count on litigation, and going to court, and testing this authority. I don’t think we’ve had anything like this before. I think President Carter maybe declared an emergency on an energy basis maybe for a region, a region or two, but never on a national basis like this. So we are in kind of unchartered waters here. And, again, it remains to be seen whether courts are going to countenance the use of these authorities to build out infrastructure.

Again, it depends on the case. Depends if you’re talking about the grid or you’re talking about keeping power plants open longer, in which case you go to the Federal Power Act and maybe you’re on safer ground there. But if you’re talking about building new generation, can you use emergency authorities there? If you’re building, say, a combined cycle gas plant, well, what about the gas pipeline to hook up to the plant? Can you use emergency authorities there, via FERC, to then authorize the construction of that pipeline? So a lot of knotty questions are going into this that are being asked as we speak. And so, again, even though you’ve declared an emergency in the case of the grid, I think it’s probably legitimate with respect to the grid, it remains to be seen how this is all going to play out. And, again, I think they’re going to find that there are a lot of obstacles standing in the way and without—I keep coming back to it—without help from Congress it’s going to be really hard to effectuate this stuff as quickly as they may think.

WORLAND: So we’re at the half-hour mark. I want to turn to the audience in a minute. But I want to ask maybe two more questions here, and really sort of zoom us out because, you know, I have a long list of particular policy matters we could discuss but we don’t have time for. So I want to zoom out with a couple questions. One, you know, we’re here in Washington. We’re talking about the administration. But of course, the energy sector is driven by the market, by market forces. And I just want to, you know, get your sense of to what extent is this administration aligning with the market, providing a tailwind? And to what degree is it pushing against the market forces that are already in play? And then, how does the private sector sort of manage that dynamic? How are you seeing companies manage that dynamic? I’d open it to anyone who wants to take it.

HILL: Well, I think we’re seeing different thumbs being put on different scales. And certainly with the Biden administration, a thumb one way, and now a thumb a different way. The challenge is I think it’s very difficult at this particular moment to know exactly how the market forces are working. If you’re stepping back truly globally, you look at South Africa and Pakistan and solar energy is just sweeping across those countries, really threatening their grids. So market forces are taking over in unexpected ways. And then you have—so you have—I found it very interesting. The Wall Street Journal had a—on the same day I saw two headlines. “The Unstoppable Energy Transition” was the Wall Street Journal’s editorial headline. And then in our own CFR it was something like, “The Troubled Transition.” And it’s very difficult to parse these things out.

And then you, of course, have Europe, that in the wake of the election of President Trump has begun to pull back on some of their thumbs on the market, most notably their taxonomy and their disclosure requirements, so that they can be more competitive in this market. And then you have the states stepping in or amping up their efforts, California, on disclosure requirements, trying to adjust the market. For me, this is not a free market on any—there is just interference occurring everywhere. But I will say, if you really step back on the markets—I agree with Sir Nicholas Stern, who determined that climate change is the biggest market failure ever because we do not price the externalities of this pollution that’s occurring. And we still haven’t approached being able to price that accurately yet, no matter whose thumb is where.

WORLAND: Drew, you mention the hyperscalers. I mean, it might be worth just talking about that briefly.

BOND: Yeah. I mean, that’s where I think the market, so to speak, is going to move forward, with or without policy, and in many cases, in this case in particular, it might be policy’s best role to get out of the way. Now, get out of the way doesn’t mean completely pull back. You know, I am a free marketeer, but I also recognize that energy in particular, as Alice noted, does not live in a free market. It’s highly regulated and subsidized here in the U.S. It’s subsidized globally. So I get all that. I just want to lean into freer and freer markets with more market competition, as much as possible. And when you look at the growth of AI and the demand that’s going to be required for that, I don’t—I mean, I feel like every day I see a new estimate, but it’s, you know, 3X by the next ten years, or something? Twenty-five percent of the growth, I think, is projected to be specifically just an AI.

Energy is needed. We need as much energy as fast as possible. And I think we can all agree we want it as clean as possible. Now, people have different definitions of clean. You know, my view is that we want it to be cleaner and cleaner over time. You know, I still view natural gas as being part of the clean energy mix. And I think we also have to be realistic that, again, while I like solar, solar has tradeoffs. And every form of energy has tradeoffs. And so I just hope that we can be realistic and practical. And when it comes to the market, these decisions are mostly made, and best made, just on pure investment. And so, you know, I just came off of a call with a billionaire who’s, you know, on the left side of the aisle. You know, I’m not a billionaire, but I’m on the right side of the aisle. And we couldn’t agree more about the need to invest in more energy faster around the world, and to have it be cleaner and cleaner over time.

Now is that because of climate? Well, it’s because of climate for some. It’s not because of climate for others. You know, others might be more focused on resilience, might be more focused on economic security and economic freedom. So that’s where I pull back from this conversation of this president and his impact on the climate. You know, what we need is more energy, faster, cleaner. And whether you want that for climate reasons or other reasons, no matter what that’s what we need. And so how do we get that is the question. And we can argue all day long, I think, about the impact of us being in or out of the Paris Agreement, but in a hundred years from now I think if we build faster, cleaner, we will all be better off, including the climate. And so that’s just where, you know, I think Trump has the opportunity—I mean, he mentioned in his State of the Union last night—or, I guess, it’s not technically a State of the Union—but, you know, cutting ten regulations for every one regulation. That has a big opportunity here if we can actually harness that towards energy.

WORLAND: So, David, it looks like you’re eager to jump in, maybe. But even if not, I’m going to ask one final question. I would ask each of you to limit to just, like, a few sentences on this question. And, David, if you want to come in on anything there, that’s fine as well. But this last question is just, you know, we talked about signal noise, skipped over a lot of the actual policy levers here. But maybe if you could just say what you think the actual most significant energy or climate policy decision in these last six weeks has been, with two sentences of explanation, and then we’ll go to audience questions. And, David, you can start.

HAYES: Sure. Sure, because it follows. It follows. I think the most significant move, potentially, and I hope I’m wrong about this, is the—is the exclusion from that executive order of solar, wind, and storage. And my worry is what’s happening to the offshore wind industry will become a contagion in terms of the lieutenants of the president being against clean energy. That can’t be the case. I hope—I agree so much with Drew. Our electricity system is growing and we need to feed it. And clean energy has got to be a key part.

What’s most overblown, I would say, is drill, baby, drill. And but I worry about that not because of—that we may be drilling more, if we can. It is that we don’t need a license here to potentially go to places that are sensitive and we don’t need to drill—in the Arctic National Wildlife Refuge. Industry doesn’t want it. And I hope that that we will not go overboard as a country because of drill, baby, drill. There’s tremendous opportunity to continue to grow on the footprint the oil and gas industry has in the United States. And they’ve done a fantastic job of making the most of it.

WORLAND: Thank you. Great. So let’s just go Alice, Michael, Drew. And, again, if you can, just very briefly so we can get a lot of audience questions in.

HILL: Well, I’m going to give you something very near term. It’s the threat to our weather science agencies. We cannot duplicate what they do. And they are seeing massive letting go of meteorologists, closing of radar stations that track tornadoes, so very difficult to be prepared if you don’t have a good forecast. And so that is the thing that I worry about the most. That is the first step in being resilient, is you have to know what the weather is.

WORLAND: Great.

CATANZARO: I think the most significant thing that hasn’t maybe even talked about enough is the—I think, the administration—the EPA’s decision to overturn the endangerment finding under the Clean Air Act for greenhouse gas emissions. That will have enormous ramifications for the regulatory sort of superstructure that governs transportation, vehicles, Title I under the Clean Air Act—stationary sources, power plants and the like, oil and gas facilities. And it could lead eventually—we’ll see—to potentially going back to the Supreme Court and seeing the Supreme Court overturning the Mass. v. EPA decision from 2007. It was 5-4 decision, and it's possible the Supreme Court could revisit that and find that, you know, CO2 and greenhouse gases are not pollutants under the Clean Air Act, were never intended to be regulated under the Clean Air Act. That will be a huge decision one way or the other, wherever you come down on it. That—looks like that decision’s moving forward.

I think maybe the most overblown that I’ve seen was the executive order governing greater assertion of presidential authority over independent agencies, I think particularly with respect to FERC. Understand the concern, certainly. You want to make sure you’re carving out that space for those agencies to operate. I would say from, you know, working in the first term, as Chair Christie said, it was pretty standard fare to take major rulemakings and send them to OIRA for review. There’s other parts of that that I think are not as well understood. The idea that the attorney general and the Office of Legal Counsel has sort of the final say on legal matters in the executive branch, I’m not sure that’s a big deal. Again, I don’t think you’re going to see the White House intervening and telling FERC what to do. But anyway, that’s one that’s getting a lot of ink, and I think it’s a little overheated.

BOND: Yeah, I would say two things.

One, as folks know in Washington, people are policy. And so I think having Chris Wright at the secretary of energy is really important—someone that, again, understands business, geology, science, and energy. And his entire team that he’s put together is impressive. You know, the deputy secretary nominee, Danly, comes from FERC and understands those many challenges around infrastructure and wires. So I think that’s one.

The other is this cutting back on regulations. I mean, we’ve been talking about permitting reform for I don’t know how long around Washington. We’ve kind of gotten close, but never really gotten it done. If we can get that done under this administration by cutting back the ten for one regulations or by whatever is done through this energy and environment task force, I think that’s significant.

WORLAND: That’s great.

OK. Let’s have some audience questions. We can go with Sherri and then—maybe let’s do two at a time, go Sherri and then up here as well.

Q: OK. Thank you all. Great discussion. Sherri Goodman, Wilson Center and Center for Climate Security.

So I agree that we could use military bases and other federal lands, national labs, to be early first movers on nuclear, geothermal, and other clean energy. And they’re—and they’re already—I mean, Defense Innovation Unit is already working that for geothermal and nuclear, and has done a lot of siting in the past, but it’s really not enough for the energy demand that we face nationally or globally. So, you know, and we’ve had—and I just want to focus on nuclear for a minute, since we have—you know, there’s been a global goal to triple our deployment of nuclear energy. And the U.S., which used to be a leader in nuclear energy, is no longer the one with the big order book globally on nuclear; now it’s China and Russia and the Koreans. We are—we’re poised to do more on nuclear, but there’s—military bases aren’t going to be enough. You know, we need a lot more investment. And it’s not just generation; I know, as Drew and others know, you know, it’s the transmission, and a lot of decisions that seem to me are not necessarily going to be made by the federal government.

And so here’s my question for any of you, which is: If we’re going to have, like, a ten to one, what are your regulations that you would get rid of? And how would you solve the issue about getting more clean or, like, decarbonized electricity from any source on the grid with all the wires and poles and other networks that we actually need that aren’t in the federal government’s primary control?

WORLAND: Great. I think we take two questions, and that way we can have—you know, they can choose which to answer. So I think we have one up here as well.

Q: Hi. Simone Williams, former DOD.

My question is actually going to pull more on what we’ve been talking about with, like, the Paris Accords and everything in the sense of we’ve seen Bloomberg Foundation say that they’re going to step up and help fund the U.N. climate council. The executive branch provides priorities and direction. But if the executive branch is no longer going to do that, what is your optimism in the fact that other businesses will step up and take that role?

WORLAND: Great. OK. Does anyone want to start with either of them?

BOND: I’ll just address Sherri’s point about nuclear and DOD. I agree, I mean, the DOD and national lab facilities aren’t enough. I think—there again, I think you could add to the mix by siting datacenters there, and so then you’re actually reducing not only the demand at the lab but you’re reducing future demand onsite.

And then, yeah, you know, I think, yeah, from a nuclear standpoint, I mean, I just think we need to be all in here. So totally with you there.

CATANZARO: Yeah, I couldn’t agree more on the point. I do think there is a sense that, you know, when we encounter these problems with the grid, that there’s a fallback to say, well, we’ll just go to military facilities and that will help move us towards solving the problem. Which, again, I don’t want to discount it, but you’re right that it’s—and then there’s also talk a lot about using the Defense Production Act. And I’m not—that’s a very unwieldy instrument to address the seriousness of this problem and the swiftness with which we need to deal with it. I think all eyes are on FERC right now on this question right now, particularly in terms of colocation behind the meter.

FERC is doing what it can—what it can. I think Chairman Christie is doing a great job. But I do think FERC needs to move faster and they need to move much bigger. You know, they just did a show cause order with PJM. They rejected the Talen-AWS deal from last year. But companies are just desperate. They’re hungry for FERC to say here’s what the rules are, here’s how they apply at the federal level in terms of wholesale markets, and here’s the demarcation between federal and state authorities; go forth and build these things. There’s so much confusion right now. No one knows what the rules are. This is an area where as a free market guy you want to have policy. You want to have intervention, particularly by the federal government in this case, to make sure that folks understand what the rules are so they can go invest and build. And that, to me—to address your issue or your question—I mean, FERC has to really step up and, again, I think sort of broaden its lens to take this issue on.

HAYES: Can I jump in on that?

HILL: I just wanted to quickly—oh, go ahead. Oh, David, yeah.

WORLAND: Yeah. Go ahead, David, and then we’ll—

HAYES: I just—OK. I just wanted to jump in in full support of what Michael was saying there. You know, the electricity and transmission, the constraints here to build out our grid better is not—is largely not a regulatory problem. You know, Rob Gramlich talks about the three Ps: the paying, the permitting, the planning. The planning and the paying are both in FERC’s bailiwick and they’ve been slow about it. They’re moving now, but the financing issues are huge, particularly for those interregional merchant lines where it’s not clear how they’re going to get paid for and where the local utilities are disincentivized to support those things.

And then the permitting side, there’s certainly room for reform in transmission in particular with the federal government, frankly, playing a bigger role, because right now it’s—to the extent there are regulatory problems, a lot of it for certainly the big lines is at the state level, because they’re disapproving these things because they don’t see it’s in their benefit. So we need a broader discussion, frankly, about regulations, particularly if we’re looking for building infrastructure, that includes states and local restrictions as well.

HILL: I just wanted to respond to your question. I don’t think the—I don’t see the private sector stepping up right now. We see in the Net-Zero Banking Alliance the major banks have walked away from that, walking away from their net zero. We’re seeing fossil fuel companies—British Petroleum, Shell—walking away from their commitments. So I’m not seeing that this is going to be driven in this climate at least publicly by the private sector.

And there’s also, of course, the litigation risk over ESG. The red state attorney generals have said they will sue for failure of following your fiduciary duty if you—a corporation relies on ESG factors. There’s an interesting aspect of that. E with the environmental, I think that on the—I’m a former judge and a lawyer, so—I think there’s a flipside. I think there’s a liability side growing for companies for directly—we’ve already seen this for fossil fuel companies; they’re being sued widely for their emissions, and there’s much better science to point to the level of emissions. There was a report just today saying I think it’s just thirty-six companies cause 50 percent of the carbon since 1856. So that makes a better lawsuit when you can point to 50 percent they—what percentage of theirs was 50 percent.

And I think you’ll also see liability for companies not adequately considering climate risk, even though we don’t have disclosure requirements. There’s going to be harm from climate risk, and at this point it’s foreseeable. We know that we will have bigger storms, more flooding. And if you decided to put something in harm’s way, causing harm—for example, you don’t have adequate generators in a nursing home and people die—there will be liability. And they may not call it climate, but it will be climate-caused.

WORLAND: I just—I want to just say one quick comment on that. I mean, the contrast between 2017 Trump, you know, elected and at COP more than 300 companies signing up and saying we’re still in, and you know—(laughs)—I think there was radio silence after this last election. But I think a good question to ask is how are internal, you know, operations, CAPEX actually changing. And you know, I—you know, you mentioned the Net-Zero Banking Alliance. How did operations at the banks that pulled out actually change after they pulled out? And I think the answer would probably be not so much, but it’s harder to get them to talk about it.

So, anyway, I know we have a question on the Zoom, and then we’ll go back to the room.

OPERATOR: We will take our next question from Nili Gilbert.

Q: Hello. I’m Nili Gilbert, the vice chairwoman of Carbon Direct. Thank you for this discussion.

We can’t have a session on climate and energy without talking about carbon pricing. And I’d actually like to ask about carbon border adjustment mechanisms, CBAMs, in U.S. policy, where as you know countries tax imported goods based upon the amount of pollution that’s required to produce them. Certainly, in the U.S. we’ve actually already seen some legislation proposed in Congress by Democrats, also by Republicans and a bipartisan proposal, but different advantages are in focus—not just concern for climate, but carbon tariffs as a potential revenue source for budget reconciliation, competitiveness with others who may have CBAMs or, you know, also countries like China that have higher emissions embedded in their goods.

So I wanted to ask what you all think about—you know, do you think that we may see progress on this in the current administration and environment? And how would you evaluate the merits or demerits of CBAMs in the U.S. or elsewhere? Thank you.

BOND: Yeah, I’ll jump in. I think, you know, I have questions/concerns about a CBAM and can it be effectively administered. You know, I mean, China has manipulated currency for I don’t know how long, you know. So if we can create such a mechanism that China can’t manipulate, then I’m perhaps more interested. But I will say if you’re an advocate for the CBAM I think the next four years is your probably best window because, as you—as you mentioned, you’ve got Republican and Democrat support—for different reasons perhaps, but it definitely fits into this tariffs discussion with the president talking about things being reciprocal.

WORLAND: Do you—I mean, maybe just like a reality check on it, I mean, do you think—there was a lot of talk in the—in the fall about this as being a, you know, potential opportunity, especially in the budget conversations. I mean, what are you actually—you know, is that real?

CATANZARO: I don’t—I don’t think it is. It’s an interesting discussion and the questioner is exactly right. It was interesting to see that, you know, there’s bipartisan legislation on this. But it really hasn’t gotten much traction, as you say, and I certainly haven’t heard it being discussed in the context of the reconciliation bill. I think when you talk to the administration—when you to the White House, USTR, or Commerce—they are somewhat intrigued by the concept, but they then will turn it immediately to the existing authority that they already have under trade laws that they think, well, if this is a problem, well, we’ll just use the existing authorities that the president already has, which are quite expansive, and if we find that there are inequities we can remedy them that way, if there are manufacturing inequities or—again, a lot of this would be directed towards China. And they feel like they have plenty of tools already in the toolbox.

I do think for Republicans as well, just to get political here—at least just to describe the politics—that the—when this concept really started gaining traction in the media after, I think, Senator Cassidy introduced his bill, there were a lot of groups on the right that basically just said, well, this is just a carbon tax. And that effort was pretty darn effective at scaring, I think, a lot of Republicans away. I don’t believe Senator Cassidy, maybe with one exception, got any Republican cosponsors on his bill, not to denigrate his efforts; I think he’s done a fine job. His staff are friends of mine. But again, I think that’s the reality—the political reality, that this for a lot of Republicans is just too close to the sun. They see it just as sort of a stalking horse for a carbon tax, and that’s really politically where the difficulty lies.

WORLAND: Let’s be—let’s be really—

HAYES: Can I jump in, Justin?

WORLAND: Yeah. If you want to come in very, very quickly, yes. Yeah.

HAYES: I would just want to put something else on the table, and I agree with these comments. I do think if Europe starts implementing it aggressively, it’ll be interesting to see—it could be that we realize that we have lower carbon products as well that help us, and that could change the political equation, I would think.

I just want to mention that—real quickly, because it goes to the trade issue—if the tariffs go on electricity coming from Canada to the U.S., we’re going to have a big issue. (Laughs.) That’s, you know, with Quebec Hydro, et cetera, these huge transmission lines now being built bringing energy down, prices going up, et cetera. So I just thank the questioner for raising the geopolitical issue here in the energy context, because it’s relevant.

WORLAND: Yeah. That’s great.

OK. Let’s be very bold and have two questions, if you could try to make them brief. And maybe I’ll just go with these two folks right in the middle. But please be—please be brief so we can try to get to both of them.

Q: This goes to the geopolitical. How much advantage are we giving China for the future market penetration, et cetera, with all sorts of green energy, grid technology, batteries, et cetera? And then also, in terms of those externalities, Senator Sheldon Whitehouse has been speaking extensively about the fact that we could end up in a mortgage crisis and a housing crisis because of the lack of insurance for places with wildfires and flooding. So I just wanted to ask you guys of the economics of both of those.

WORLAND: Great.

Q: Back to the geopolitics. The U.S. in the recent three years in climate negotiations or in the side discussions, I’ve been on panels with U.S. diplomats; they’ve all been pushing critical minerals. How do you see that playing out, Alice, in all of this discussion, the fight over geopolitics over critical minerals?

Second, will IRA be dismantled, the Inflation Reduction Act? I think industry was happy about it.

WORLAND: OK. Wow, big questions. Very quickly. (Laughter.)

HILL: OK. I’ll—

WORLAND: How much time do we have?

HILL: I will just say I think China’s going to be a big winner. Their cars are going to be exported. Already they’re a winner in the clean energy space.

The property insurance, don’t underestimate that. I do do a lot of work on the property insurance issues. It’s coming to you. It’s coming to all of us. And we do not have the resilience in place to make this attractive to private insurers who are—they’re—just want to make a profit every year, and they only give you a contract every year. So their solution is they’ll get out of the market. That will put huge pressure on the federal government to do something.

I think this discussion on critical minerals, I think it’s really hard to know what will take place at the—in the U.N. without the U.S. present. We won’t be a part of that. But, obviously, President Trump is trying to advance his agenda on critical minerals.

And I have no idea whether the IRA is going to be overturned or not, but maybe some of these folks who are better at reading the crystal ball of Donald Trump than I am and the Congress.

CATANZARO: Well, yeah, on the IRA question, you’re absolutely right that many businesses are up on the Hill as we speak arguing to protect/preserve any number of the credits. I think the House is interesting because you have a two-seat margin and you do have any number of Republicans who want to see these credits stay in the books. We probably have a lot more in the House Republican Conference who want to see them go away, and I think that includes the House Republican leadership. And I think what they’re finding at the leadership level is there’s just—it’s too hard to adjudicate between all the different members coming to them and saying, well, I want 45V or I want 45Q or keep—so their sense is, well, is it easiest just to get rid of it all. And I don’t think that’s what’s going to happen. I think you have biofuels credits that—you know, the biofuels industry is very powerful and probably can preserve their credits. I think the nuclear credits are probably safe just because there’s such strong support for nuclear. Things like 45Q in the Senate, when you think about who was, you know, the architects of 45Q, you’ve got Senator Barrasso, who’s the majority whip. You got Senator Cramer and Hoeven and Capito as chair of EPW. I don’t think they’re going to allow those credits to go by the wayside.

And so while there’s a lot of noise, speaking of noise, at the end of the day I do think you’re going to see a number of these credits stay. They may not look like they look today. Maybe they’re less generous. Maybe the scope is reduced. Are there some that are very vulnerable, more vulnerable than others? Yes. The 30D credit for EV, the consumer credit, probably goes away, maybe goes away over a year or two. So there’s kind of a continuum of vulnerability. But some of these will survive, I think, at the end of the day.

WORLAND: Drew, if we—maybe just—OK.

David, do you have a fifteen-second last comment? Then I’m going to wrap.

HAYES: No, I’m good.

WORLAND: OK. (Laughter.)

HAYES: I’ll give you fifteen seconds. (Laughter.)

WORLAND: OK. Well, thank you. Thank you to this—

HAYES: Use it wisely. (Laughter.)

WORLAND: Thank you to this great panel. I think we covered a lot of ground. So much more we could have. It’ll be interesting to revisit in a year where all of these things land. But thank you. Thank you to this panel. (Applause.)

CATANZARO: Thanks. Thanks.

BOND: Thank you.

HILL: Thank you.

(END)

This is an uncorrected transcript.