Trump is ditching climate action, again. This time, there are ways to fight back

When a triumphant Donald Trump reclaimed the White House last week, he wasted no time in declaring war. Not a trade war, nor an invasion of Greenland or Canada, but effectively a war on the environment.

Last year was the hottest year in history, and Trump’s actions on day one of his second term were an ominous sign.

US President Donald Trump signs a slew of executive orders on the first day of his presidency.Credit: AP

First, he signed an executive order to withdraw the United States from the United Nations climate treaty. The US is now only one of four countries not in the Paris Agreement – the others are Iran, Libya and Yemen.

He followed through on his threats to ban new offshore wind projects and he also announced a review of the federal government’s leasing and permitting practices for wind projects in general.

He declared an “energy emergency”, with the aim of garnering increased powers to approve production of fossil fuels, particularly in Alaska. Though, in a bet each way, it will also cover critical green minerals.

A separate order “unleashing” energy supplies included a laundry list of actions – declaring it official policy to encourage energy exploration of the continental shelf, eliminating a supposed electric vehicle mandate that apparently does not exist in law anyway, and safeguarding the right of Americans to choose their own lightbulbs.

By delivering all this within hours of the inauguration, Trump signalled his intention to do everything within his power to expand fossil fuels or “drill, baby, drill”.

The question is: how much power does he have? Within the US, quite a lot, given Republicans control Congress and the conservative majority on the Supreme Court. However, much of the real work to reduce greenhouse emissions in the US is actually happening at state level and that will continue.

The bigger question is how much influence Trump has outside the US. This is up to us. There is a world where Trump’s actions mean the global race to decarbonise loses momentum.

Economics describes “the free rider problem”, where some people have an unfair advantage because they are not paying a fair share (or paying nothing at all) for a shared resource. If the world’s largest economy is free riding by not cutting emissions, the other Paris signatories may be less inclined to do their part as well.

Australia is a small contributor to global emissions – if you don’t count our fossil fuel exports – but we can’t afford to get left behind.

Pessimism about our collective ability to effectively tackle climate change can also mean people – voters, business leaders and politicians – succumb to despair. This can lead to a nihilistic impulse – the attitude that “the world is burning, so I may as well look after No.1”.

Finally, politicians who seek to emulate Trump and exploit mistrust of renewables may gain the ascendancy. There are certainly signs this could happen in Australia. Yet, there is also a world where other countries go hell for leather in cutting emissions while waiting for the US to return to the fold.

Don’t forget, we have been here before. Trump also withdrew the US from global climate treaties the first time he was president. The rest of the world got on with the job, then Joe Biden came to office and rejoined the pact.

Star of the South, 10 kilometres off Gippsland’s south coast, is the most advanced offshore wind project in Australia.Credit: Getty Images

There is a pipeline of potential investment in renewables projects including large offshore developments in the US. Global investors will be looking to redirect that money, and Australia has a chance to capitalise on this situation, or it will cede ground to other countries.

As one example, the Danish owner of Star of the South in Gippsland is looking at possible new sites for offshore wind projects including in Australia and New Zealand.

Many large countries and groupings have finally hit their stride with decarbonisation and this won’t be abandoned just because of Trump.

In the European Union, Carbon Brief reports that coal power use has fallen by almost two-thirds in the past decade, while solar power output has tripled. Last year, it overtook coal generation for the first time; and wind power has doubled.

And what about the world’s largest emitter of carbon dioxide? China installed a massive 301 gigawatts of renewable capacity including solar, wind and hydro in 2023 alone, more than the total renewable generating capacity installed in most countries over all time. As of May 2024, “clean energy” generated a record high 44 per cent of China’s electricity.

Observers believe emissions in China may have peaked, as this masthead reported last year.

Will Europe and China simply let the US be a free rider? They have plenty of ways to fight back.

Europe is phasing in a Carbon Border Adjustment Mechanism, a fee or tariff levied on imported goods based on the greenhouse gases emitted during their production. It is due to be fully operational by 2026.

China, while critical of the European levy as protectionism in a green guise, is no stranger to a surgically targeted tariff. What the superpower does in response to Trump walking back climate policies remains to be seen.

Australia has also been investigating the feasibility of applying its own Carbon Border Adjustment Mechanism.

Australian export businesses need to be ready for this new development. Zachary Zeus, head of start-up Pyx Global, says that under a Carbon Border Adjustment Mechanism, individual businesses may be able to avoid tariffs by sharing verifiable information through the UN’s transparency protocol.

Australia has endured a destructive political battle over climate action for at least two decades, and it will feature again in the federal election this year.

The government has a policy to dramatically expand renewables, while the Coalition wants to extend the life of coal-fired power stations for another decade or two while building nuclear power plants instead.

Echoing Trump’s opposition to offshore wind, Opposition Leader Peter Dutton has vowed to scrap three of the Albanese government’s six offshore wind zones; two in NSW and one in Western Australia.

Most energy experts say Dutton’s nuclear policy is fantasy because of political opposition and the time it would take to build. Even renowned nuclear advocate and investor Bill Gates told The Australian Financial Review in 2023 that nuclear for Australia was “not worth touching” and the nation should focus on its advantages with renewables.

Former Coalition MP Christopher Pyne also acknowledged nuclear was not going to happen in Australia in a recent opinion column, though he couched it as praise for Dutton’s political strategy.

Australia is a small contributor to global emissions – if you don’t count our fossil fuel exports – but we can’t afford to get left behind as the world responds to Trump 2.0. Being swayed to emulate his energy policies would be a mistake.

Ross Gittins is on leave.

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