It is a new era with Republicans in control of the House and the Senate and Donald Trump in the White House. Already, the President has made it clear that energy policy is going to be a priority for his administration. This is an appropriate response to the election mandate. In a new white paper, Philip Rossetti and I argue that a policy agenda built on freedom, innovation, security, and transparency will supply families and businesses with affordable, reliable energy. It will also result in a more prosperous, secure America and a cleaner planet.

Economic freedom is essential to American identity, and American energy companies need the freedom to invest, build, and trade. While our country is the global leader in energy production and innovation, building new energy infrastructure in the U.S. is increasingly difficult. Whether it is linear infrastructure like pipelines, transmission, and rail or zero-emissions nuclear plants, regulatory paralysis and excessive litigation cause significant delays. Permitting reform received substantial interest in the last Congress, and likely will remain a priority. To preserve U.S. economic competitiveness, energy dominance, and environmental advantage, permitting reform must remain a central policy focus.

>>>READ: The Energy and Climate Leadership We Need

Legislators should prioritize empowering energy consumers and producers. As Energy Secretary Chris Wright emphasized in his first Secretarial Order, consumers should be able to buy appliances they want without energy mandates overriding their preferences. Wright emphasized that “Our energy abundance should be an asset, not a liability.”  Fully utilizing that asset means the ability to export energy to America’s allies. Wright’s call to restore order for liquified natural gas (LNG) export applications is a commonsense first step. Increasing LNG exports would help America’s European allies end their dependence on dirtier Russian gas. More fundamentally, the Biden administration politicized a decision that should have been left to the market. 

Subsidies are another policy lever that nudges what energy source developers should supply and overrides consumers’ preferences. The Inflation Reduction Act included energy subsidies that, if left in place, could cost taxpayers nearly $2 trillion over the next decade. In addition to the high fiscal costs, subsidies distort energy markets, and the subsidies for mature technologies will go toward projects that would have been built anyway, reducing any economic and environmental benefit per dollar of taxpayer money spent. 

>>>READ: Keep Permitting a Priority in 2025

Subsidies for mature technologies adversely impact innovative, emerging technologies. One promising new clean energy developer is Fervo, a next-generation geothermal company that could provide affordable, reliable, and clean power.  In a 2023 interview with S&P Global Insights, Fervo Energy CEO Tim Latimer commented on how policies like investment tax credits can hamstring new technologies “because the big financiers of tax equity have a rinse and repeat model and they like to go with big companies, big transactions and proven technologies.” It’s difficult enough for new energy technologies to reach the market. Government policies that create higher barriers to entry, lengthen timelines, raise costs, and distort financing make it unnecessarily difficult. An ideal policy scenario would eliminate preferential treatment for all energy sources and technologies. However, eliminating the subsidies for mature technologies would be a welcome first step that will have huge fiscal savings and protect the integrity of energy markets. 

Republicans can advance America’s economic interests while leading on emissions reductions. The answer is freer and better-informed markets. The centrally planned approach to climate policy favored by the Biden administration is rife with examples of inefficiency, exacting high costs for minimal gains. By contrast, policies that have focused on empowering the expression of preferences and improved productivity in the market have delivered substantial climate gains and can produce economic and environmental benefits beyond our borders.

You can read the full white paper here. 

The views and opinions expressed are those of the author’s and do not necessarily reflect the official policy or position of C3.