Two broad ways to define President Joe Biden’s energy legacy are through policy influence going forward and public perception going backward.
On one hand, Biden’s energy legacy will unfold over the next decade as the regulatory reach of the 2021–2022 “new green deal” bills he championed are challenged in the GOP-held Congress and by an incoming administration pledged to unspool its authorizations.
On the other, some say public perception has already rendered a verdict on Biden’s energy legacy with President-elect Donald Trump’s November 2024 election twin following a campaign highlighted by his call to “unleash” American energy and undo his predecessor’s “new green scam” legislation.
With energy demand and costs increasing, Republicans embedded into voter perception the “political optics” of exclusionary federal grants and tax credits for renewable energies as inflationary drivers, Chicago-based senior market analyst Phil Flynn with The PRICE Futures Group told The Epoch Times.
The perception that the administration’s “government-knows-best” forced transition created disruption and uncertainty is unlikely to change, especially because Biden’s initiatives didn’t come from economists but from political advisers in a legacy-defining misperception, he said.
“Biden’s energy policies were based on ideology, not reality; on a climate agenda that was more about politics than science,” Flynn said.
He said ideology-driven policy “based on faulty perception” has many institutional investors recalculating commitments to green initiatives that contributed to a decline in enterprise capital for oil and gas infrastructure, induced by federal agencies “turning the big banks against U.S. oil and gas and turning endowment funds from investing in fossil fuels.”
Such investment gaps, even over brief spans, will reverberate as lost time in scaling infrastructure to pace runaway demand, Flynn said, noting that this, too, will be part of Biden’s energy legacy.
“Biden’s probably created a situation where U.S. energy, over the next 10 to 25 years—it’s going to be more of a challenge to meet demand,” he said.
Yet, by definition, much of Biden’s energy legacy is undefined.
“The Trump administration will, in many ways, shape the Biden legacy,” Robert Stavins, a Harvard Kennedy School of Government professor and former Environmental Protection Agency Environmental Economics Advisory Board chair, told The Epoch Times.
“In order to say something about that, one has to really say something about what the actions are going to be of the Trump administration, and so a reasonable place to start is the Trump administration is likely to try to roll back any provisions they can of the IRA.”
Watershed Legislation
The Inflation Reduction Act (IRA), along with the 2021 Bipartisan Infrastructure Law and the 2022 CHIPS and Science Act, are massive slates of legislation that collectively authorize more than 80 federal regulatory regimes in implementing a “whole-of-government” approach packaged as “The New Green Deal.”The IRA, passed in strict partisan votes, authorizes 10 years of sustained tax credits, low-interest loans, and grant programs incentivizing investment in renewable energy generation, supply chains, job creation, advanced manufacturing, and electric grid expansion.
Supporters argue that the IRA is a watershed of job-generating affordable clean energy development that has U.S. industry on the cutting edge of global manufacturing and renewable advancements.
As of April 2024, according to the National Association of Manufacturers, the number of factories in the United States had grown by more than 11 percent since 2022 and nearly $650 billion in private capital had been invested in U.S.-based manufacturing.
Critics argue that the IRA is a boondoggle with politically framed goals, a low return on investment, and an incalculable squander of lost opportunity costs.
Scalpel Not Sledgehammer
Among Trump’s likely Day One executive actions will be orders removing the United States from the 2015 Paris Climate Accord, ending the LNG export permits, reversing Biden restrictions on public lands/offshore leases, terminating offshore wind power leases, and creating a national energy emergency declaration to fast-track permits for grid infrastructure and energy projects.
“The election of Donald Trump could result in a reduction in [IRA] spending and tax breaks by 40 to 50 percent,” Tortoise Capital Advisors senior portfolio manager Rob Thummel told The Epoch Times.
“The likelihood of repealing the Inflation Reduction Act (IRA), or parts of it, is very high,” Energy Outlook Advisors managing partner and energy economist Anas Alhajji told The Epoch Times, noting that it will be done with a scalpel not a sledgehammer.
“Repealing even parts of it would cause a sea change in the energy markets, especially in two areas: electric vehicles and offshore wind.
“The [IRA’s] impact is global, not only limited to the U.S. The result is higher demand for oil, natural gas than current expectations.”
Much of the IRA’s benefits are roosting in red congressional districts.
“There are parts of the IRA that Republicans and the oil industry like, but any way you look at it, it is government giveaway,” he said.
In an August 2024 letter to Speaker Rep. Mike Johnson (R-La.), 18 House Republicans from 13 GOP-majority states expressed concern over “prematurely repealing energy tax credits” that industry and constituents have relied on to make investments and create jobs.
“Many traditionally Republican states could benefit from jobs created by clean energy investments,” Thummel said. “Investment and production tax credits likely remain in place to support the development of wind, solar, and biofuels as well as the research and development of carbon capture and sequestration as well as hydrogen.
“Certain initiatives like climate justice, conservation, environmental reviews, and the clean fleets for the U.S. Postal Service, could be at risk.”
Stavins said Trump’s America First trade policies, ironically, inadvertently, could aid—or be aided by—Biden’s energy legacy.
Methane a Bane
Republicans have cited IRA-related costs as exceeding its return-on-investment and define its “green subsidies” as “corporate welfare” when voting 54 times since 2023 to repeal all or parts of it, including with the adoption of The Limit, Save, Grow Act of 2023, which cut billions from IRA climate, environmental justice, and clean energy provisions.With a complete IRA overhaul unlikely, the Trump administration will undo Biden’s energy legacy via a death of a thousand cuts starting with nixing Executive Order 14082. Subsequent administrative and legislative actions will then address the IRA.
Stavins said top IRA targets are the Greenhouse Gas Reduction Fund, Methane Emissions Reduction Program, energy efficiency standards for domestic appliances, electric vehicle tax credit, and Department of Energy loan program.
“Since the IRA is essentially direct subsidies and implicit subsidies through tax, tax credits, the one part that’s not is the methane fee, which is a tax, and that is a particular target of this administration,” Stavins said. “The methane emissions reduction program [is] ... very, very unlikely to survive.”
Flynn said industry is not opposed to regulating methane but the way the IRA implements its rule “is going to reduce U.S. oil productions by millions of barrels a day.”
The rule penalizes small operators, he said.
“Small oil and gas producers, if they [implement] that law as they want to, it will shut them down. You'll shut down most of small producers, and they’re the backbone of the U.S. oil and gas industry,” Flynn said.
He cited energy efficiency standards for domestic appliances and the electric vehicles tax credit as two IRA components of Biden’s energy legacy that GOP lawmakers and the Trump administration will target.
“They threw a bunch of money to Detroit to build electric cars. Billions of dollars of tax credits and stuff, only to lead to billions of dollars of losses for us and for oil or car companies that bought into this, right?” Flynn said. “The electric vehicle component, the tax credits for that, those are things you’re thinking would probably be shucked overboard. I think they will be—or definitely modified in a different direction.”
All are enduring tentacles of Biden’s energy legacy that, by definition, will be defined by what the incoming Trump administration and Republican-controlled Congress do with the IRA.
It’s a big bill and a big question mark.
“There’s stuff in [the IRA] we need. We need to rebuild bridges, right? We need to rebuild stuff,” Flynn said. “The question is, Biden’s vision that government can do everything. Government not only can build bridges, but can make moral judgments on human beings. The answer to every problem is to throw government money at it. The question is whether politicization [can be overcome].”
