For months, Trump has pushed an energy agenda that is radically different to that of the existing Obama administration. His campaign rhetoric appears to oppose climate change measures and renewable energy.
“President Obama has done everything he can to get in the way of American energy,” the Trump website states.
“Here are a few of President Obama’s decrees,” it continues. “Regulations that shut down hundreds of coal-fired power plants and block the construction of new ones. A prohibition against coal production on federal land. Draconian climate rules that, unless stopped, would effectively bypass Congress to impose job-killing cap-and-trade.”
Trump has called for the lifting of regulations and restrictions on coal, oil and gas industries, including those from the Environmental Protection Agency and The United States Fish and Wildlife Service.
Speaking at Shale Insight: A Shale Coalition Conference, Trump said: “It’s great to be with so many of my friends. Oh, you will like me so much. You will get that business… You are going to like Donald Trump, and all of those workers that get put to work, they’re going to love Donald Trump. So that’s good.”
He then shared his gratitude to fossil fuel lobbying groups during the primary campaign: “I also want to thank the Marcellus Shale Coalition and Ohio Oil and Gas Association.”
An energy boom?
One of the projects likely to benefit from Trump’s triumph is the Keystone XL pipeline, a proposed 1,179-mile (1,897km) pipe that aims to connect the oil sands in Alberta, Canada, to Steele City, Nebraska, transporting the equivalent of 830,000 barrels of oil each day. Opposed and stymied by Obama, Trump said of the project in May: “I would absolutely approve it, 100 percent, but I would want a better deal. I want it built, but I want a piece of the profits. That’s how we’re going to make our country rich again.”
Moves like this aim to drive energy prices down and increase the number of fossil fuel projects under way. Trump promises to “unleash America’s $50 trillion in untapped shale, oil, and natural gas reserves, plus hundreds of years in clean coal reserves.” Some have questioned whether coal or even oil drilling will boom when regulations are removed and federal lands are opened for business, as prices are falling. An oil production explosion has slashed petroleum prices and fracking has proved more cost effective than coal - in fact, fracking is thought to have taken away more coal joba than regulation.
As for renewable energy, Trump has appeared less positive than on fossil fuels. “Wind projects [have] killed more than a million birds a year. Far more, I have to tell you. Far more,” he said at the Williston Basin Petroleum Conference in May. Trump tried to block a wind farm project near his golf course in Scotland claiming it would “spoil the view.”
He has also spoken negatively of renewable energy subsidies, as well as cast doubt over the validity of climate change, tweeting in 2012: “The concept of global warming was created by and for the Chinese in order to make US manufacturing non-competitive.”
However, he has since denied saying it, or said that it was a joke.
He told the Fox News TV show Fox & Friends in January: “Well, I think the climate change is just a very, very expensive form of tax. A lot of people are making a lot of money. I know much about climate change. I’d be — received environmental awards. And I often joke that this is done for the benefit of China. Obviously, I joke. But this is done for the benefit of China, because China does not do anything to help climate change. They burn everything you could burn; they couldn’t care less. They have very — you know, their standards are nothing. But they — in the meantime, they can undercut us on price. So it’s very hard on our business.”
Trump has promised to pull out of the Paris Climate Agreement, reversing a US promise to contribute to a $100 billion global fund to assist poorer nations in addressing climate change.
“Climate change policy is going to come to a screeching halt,” Robert McNally, president of energy-advisory firm the Rapidan Group and former adviser to President George W. Bush told The Wall Street Journal. “The Paris Agreement from a US perspective is a dead agreement walking.”
Sources at Scientific American say that Myron Ebell, director of the Center for Energy and Environment at the conservative Competitive Enterprise Institute, is leading Trump’s transition plans for the EPA. Ebell has repeatedly shared his skepticism on the validity and ferocity of climate change.
The sun will rise
Some, however, remain hopeful that the Trump presidency will not damaging the solar industry too much. The tax breaks and incentives created by the Bush and Obama administrations have allowed solar to find some footing, and numerous businesses are pushing forward with climate friendly moves irrespective of who is in power. Others think this is an optimistic spin on what appears to be tough news for solar power firms.
But Bernadette del Chiaro, executive director of the California Solar Energy Industries Association, told The LA Times that renewable support was a politically expedient move: “From the Tea Party to the extreme liberal wing of America, this is something broadly embraced by all. If he’s looking to bring the country together, this is something all people can get behind.”
With Trump promising to make America 100 percent energy independent (presumably excluding the Keystone pipeline from Canada), renewables will have to be involved to make up some of that percentage. The question that remains is just how much.
For data center operators, policies that potentially decrease energy prices will have a clear impact on operational costs, should they choose to use fossil fuel energy. Hyperscale operators like Amazon and Google are unlikely to change in their plans to transition to renewable energy (or at least will continue to fund renewable projects and buy renewable energy power purchase agreements). For them, renewable energy was always more about what the company claimed it believed in ethically, or (skeptics might say) a move to ensure local planning approval, and gain positive public relations at the larger scale.
Amazon, for example, has long said that it plans to make AWS carbon neutral, recently announcing plans to fund a 189MW wind farm.
But there is a chance that this transition could be slowed, even if the hyperscalers keep the same goals. Amazon, Google, et al rarely actually construct the renewable projects themselves, rather they use existing companies with existing projects.
Take Amazon’s Ohio wind farm - while Amazon only recently decided to become the sole customer, making the project possible, EverPower Wind Holdings has actually been planning the development since 2013, slowly working its way from conception to actuality.
Such projects could slow to a crawl under Trump - even if he doesn’t mean them to. Not only will renewables naturally be less competitive and in demand should fossil energy prices fall, and the costs of operating a high carbon emitting company fall, but renewable companies are already suffering due to the perceived threat Trump represents.
The day after Trump was confirmed as the next president, WSJ reports shares of SunPower fell 14 percent, SolarCity 5 percent, Vivint Solar 9 percent, and wind farm developer Pattern Energy 7 percent, to name but a few.
The world’s biggest turbine maker Vestas Wind Systems, which manufactured wind turbines to power a Microsoft data center, was one of the worst hit by the news of the new president, falling 14 percent before rallying a bit to trade 6.6 percent lower.
Weaker performance of renewable energy companies outside of the data center industry will affect both the number of these projects, as well as the rate of innovation and investment in the field as a whole.
Trump and the floating data center boss
The New York Times has James Connaughton on the shortlist for Energy Secretary, a role which is primarily focused on the maintenance of the US’ nuclear arsenal, but also “energy strategy, promoting American leadership in science and clean energy technology innovation.”
Connaughton previously served as George W. Bush’s environmental adviser, and as chairman of the White House Council on Environmental Quality and Director of the White House Office of Environmental Policy from 2001 to 2009.
However, from our perspective, what is most interesting is what he has done since leaving public service. In March 2016, Connaughton was appointed President and CEO of Nautilus Data Technologies, which plans to deploy a waterborne data center. We spoke to Connaughton in August about what the company had achieved.
Should Connaughton be chosen as Energy Secretary, it is likely he will be the closest person to Donald Trump with a direct understanding of and relationship to data centers.
He is an adviser to the non-profit lobbying group ClearPath Foundation that promotes “conservative clean energy.”
Read the rest of our Trump analysis here: