Why Donald Trump’s Energy Plan Can Work 

Todd Royal
Todd Royal is an independent public policy consultant focusing on the geopolitical implications of energy based in Los Angeles, California.

It’s time for California to get serious about job growth. Recent data has shown consumer confidence is down from this point last year. Bond yields on 10-year Treasury notes, along with Japanese and German bonds are at all-time lows. This is dragging oil prices back down to depressed levels. Pitfalls are everywhere with global economic and geopolitical uncertainty rising. And now the Bank of England has taken drastic action it hasn’t taken in years, because of Brexit. These are reasons why California businesses should have concerns over worldwide economies, poor corporate profits and whether Central Bank policymakers will continue pushing bond yields lower hurting earnings prospects for banks. 

Oil below $50 a barrel shouldn’t be happening, based upon supply disruptions in Nigeria, Canada, Libya, and Venezuela. Yet worldwide demand will top 101.8 million barrels per day in August, as projected by Reuters, has investors scratching their heads trying to make sense of it all. Does this mean oil has strong momentum, and the days of $100 barrel of oil returns? Possibly, and with US consumers devouring record amounts of gasoline, now is the time for California and the US to take advantage of cheap oil, and abundant natural gas to finally bring developing nations into the community of prospering societies.

All of this show of force points to having a coherent energy policy, and so far, Trump is the only one who has spoken on record about how to create jobs through US energy policy. Clinton’s policy has been to continue President Obama’s strategy of lowering carbon dioxide emissions via regulations (Clean Power Plan) and pushing for more wind and solar through generous Federal tax breaks. Clinton has also said she will kill the coal industry, yet coal is still a major source of fuel for the US and the world (China, India, Africa and Asia) – so Clinton’s proposal of killing off an industry that helps poor people around the world is troublesome.

Instead, the US should be the leader in exporting coal to undeveloped and developing countries that have zero interest in environmental degradation or climate change. Even the Germans are building coal-fired power plants since their renewable targets aren’t meeting their energy demands. The Chinese who made a big show of their environmental credentials at the Paris Summit still have staggering amounts of air pollution in their capital of Beijing. The US has environmentally and technologically sound solutions with coal and natural gas other nations don’t have at this time.

The problem isn’t climate change, or whether or not you like fossil fuels, renewables or a combination, it’s simply that renewables aren’t a California job creator or supplier of energy that fossil fuels provide. Considering levelized costs and the economic momentum it would take to convert worldwide and US electricity consumption to renewables – inertia and momentum will hamper widespread renewable consumption – for decades unless consumers want to pay for this overly expensive choice.

Simply put, energy capacity stops renewables in their tracks. Energy capacity is how an energy source runs at full capacity when in use. Nuclear reactors run at 90%, combined-cycle natural gas power plants run around 40%, coal-fired power plants are at 70-74% whereas wind and solar are at 20%. This means the two most popular renewables only have their best output Error! Hyperlink reference not valid. of the time before discounting cloudy days or wind disruptions. Without Federal subsidies, both renewables won’t replace natural gas in the near future – a proven fuel source – that will mitigate climate change now.

The US is the leading producer in the world of oil and natural gas thanks to the fracking boom. California is energy rich off the coast and inland as well. Trump has proposed opening up Federal lands and outer continental shelves for exploration. Considering the average North Dakota trucker made over Error! Hyperlink reference not valid. a year during the last oil boom that is something for California middle class job seekers to weigh.

With US job growth tepid, and renewables unreliable, Trump’s plan could open up the floodgates for jobs that fossil fuel extraction unleashes. These value and supply chains consists of industrial systems, wells, storage tanks, pipelines, crude rail cars, trucking, housing, roads, infrastructure, schools and refineries along with restaurants and other support systems a modern economy needs to thrive.

California’s cap and trade system isn’t working, and the state is attempting to eliminate green subsidies for electric vehicles because of cost. Most people want renewables to work, but people need to live, work, and thrive today. Trump’s plan offers real solutions for how to grow the US economy and developing countries.

Trump would more than likely use executive actions to open up Federal lands to oil and natural gas exploration, approve the Keystone XL pipeline, and make renewables compete in the marketplace without generous taxpayer subsidies. This will open renewables up to replacing fossil fuels for future generations because of competition, and with Trump’s expansion of coal allow developing nations to escape generations of soul-crushing poverty through energy expansion. California can be the leader in energy, climate change elimination and bringing millions out of poverty.

No plan is perfect – least of all energy plans – but with the world in flux – California needs solutions that are proven to work – and make sense for America and the developing world. Though I certainly hope one day to have a zero-carbon emission fuel cell in my home that charges my electric vehicle, it won’t be happening this election cycle or anytime in the near future.

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