Climate and energy are back on President Obama’s agenda


Drawing on the optimism and entrepreneurialism that define American dreams, President Obama reframed his country’s approach to the climate and energy challenge during yesterday’s much-anticipated speech at Georgetown University. It seems that climate change is an opportunity for everyone, from farmers to scientists, engineers to builders, and businessmen to blue-collar workers. But he acknowledged the scale and duration of the challenge, and it has yet to be seen whether the world believes that American leadership in international climate change efforts is credible.

Domestically, Obama’s optimism stems partly from his ability to circumvent an intransigent Congress. Most importantly, he intends to use his Executive powers to have the Environmental Protection Agency tighten regulations on both new and existing power stations, which make up about a third of the country’s emissions. He also plans to further improve vehicle fuel economy standards, raise energy efficiency standards for appliances, and change government procurement rules so that one fifth of its electricity is sourced from renewables within seven years.

To accelerate renewable deployment, Obama wants to let private companies install about six gigawatts of renewables on public land by 2020. It is an approach that has been pioneered by the Carbon Trust here in the UK, having recognised public sector land as an underutilised resource and successfully developed renewables on several public sites in the UK through our own enterprise, Partnership for Renewables.  Obama also aims to renew tax credits for renewables with bipartisan support – hopefully a realistic goal, since 75% of wind power is generated in Republican states. Learning and innovation, meanwhile, will reduce costs and strengthen domestic capabilities to deploy renewables at scale in the medium term.

These measures, and many less specific aspirations outlined in his address, will significantly impact the trajectory of America’s greenhouse gas emissions.

That, plus an all-American “dash for gas”.  Natural gas, extracted through hydraulic fracturing or “fracking”, continues to transform the US energy landscape. It has helped the country reduce emissions by about 13% since 2005, and was lauded by Obama as a job creating, carbon reducing, cost saving achievement unlocked by clever innovators and ambitious businesspeople. Domestic gas is seen as a transition fuel that can wean the US off of coal and seriously dent emissions while keeping energy prices low. While its issues were acknowledged, it’s clear that gas is a centrepiece in the US climate and energy strategy – for the time being at least.

The President’s international ambitions were just as broad as his domestic ones. Obama called for an international moratorium on public financing for new unabated coal plants, and plans to negotiate for global free trade in environmental goods and services. He’s cooperating with China, India and Brazil to help them leapfrog dirty technologies in their drive for development, and wants to reinvigorate the UN negotiating process – though without Congress onside, binding agreements might be difficult to forge. Nevertheless, his willingness to engage globally is a positive sign.

Overall, Obama’s vision is broad and ambitious, and has already been praised by climate pundits around the world. He took on the climate sceptics and laid out both plans and aspirations, which together should spur American innovation and investment, and give the rest of the world some hope that America’s years of tepid engagement and weak moral authority may finally be behind us.