US domestic energy output, curtailing climate rules among Trump's Day 1 priorities

President Donald Trump, shortly after being sworn in Jan. 20, said he will declare a national energy emergency with an emphasis on his campaign pledge to "drill, baby, drill," and do away with Biden-era policies he criticized as detrimental to domestic energy production.

A slew of executive orders will be signed opening more federal lands and waters to leasing and oil and gas development, including in Alaska; ending what conservatives derided as an electric vehicle mandate; and rolling back "burdensome" regulatory impediments to job creation and resource production, among other things, White House officials told reporters.

Trump, in his inaugural address, further promised to prioritize exporting US energy, revoke climate-oriented policies and impose tariffs on foreign countries -- actions he has contended will help lower domestic energy costs under his "America First" agenda.

Trump said in his address that the US would "fill our strategic reserves up again," highlighting his goal of bringing down energy prices and exporting US energy. A White House press release put a priority on making "America affordable and energy dominant again."

To do so, the Trump administration plans to streamline energy infrastructure permitting, end former President Joe Biden's climate policies, and review for rescission any regulation it sees as burdening energy production and use, including mining and minerals processing, the White House release said.

Alaska is slated to get its own executive order, with a focus on lifting limits to use of the state's natural resources, potentially including oil, gas, timber, critical minerals and seafood. While House officials emphasized Alaska's geostrategic location, including for LNG exports.

With few details on how the administration will achieve its agenda, it remains to be seen what obstacles the executive actions will face -- both in terms of market impediments to increased production and legal hurdles related to rulemaking procedures.

Permitting reform

Permitting reform legislation failed to cross the finish line in the lame-duck session of Congress, but the new Republican majority in both the House and Senate have signaled an eagerness to tackle the issue. Some even pointed to the possibility of reforms being included in budget reconciliation legislation lawmakers hope to move early this year.

The White House release said Trump "will declare an energy emergency and use all necessary resources to build critical infrastructure." The emergency energy declaration "will unlock a variety of different authorities that will enable our nation to quickly build again," a White House official said.

Scott Segal, a partner at Bracewell, recalled that President Jimmy Carter declared an energy emergency to address challenges including effects of the 1973 oil embargo and the 1979 oil shock.

"The Carter administration did use emergency authority to expedite energy projects by compelling regulatory relief in certain cases," Segal said in an email. "Emergency authority was deployed to diversify the portfolio of energy sources, whereas the Trump administration may be more narrowly focused on just increasing fossil fuel production."

Wind energy

Trump's desire to boost domestic energy production does not extend to wind energy. The White House said it would put an end to wind leasing.

Representative Jeff Van Drew, Republican-New Jersey and chairman of the House Judiciary Committee's oversight panel, said last week that he had been tapped to draft an executive order to freeze all offshore wind energy development.

New Jersey beach communities and the commercial fishing industry have been staunch critics of the Biden administration's aim to approve 30 GW of offshore wind by 2030. Trump latched on to the criticism during his campaign, saying he would begin to unravel the offshore wind program on day one of his second presidency.

Wind is expected to make up 12.9% of US capacity additions in 2025, with solar accounting for 51.7% and battery storage accounting for 35.5%, according to data from S&P Global Market Intelligence.

EVs, 'consumer choice'

The White House also pointed to upcoming actions that could slow the uptake of EVs and reverse Biden-era initiatives to increase energy efficiency standards and support electrification.

Trump has been vocal about his stance on EVs, taking aim at the Biden-era EV tax credit and the push toward electrification on multiple occasions. Removing this tax credit would be disadvantageous for the whole US EV industry and further the cost parity with internal combustion engine cars, said Suzanna Massingue, low carbon transportation analyst at S&P Global Commodity Insights.

"We do expect that short term sales won't be drastically decreasing in blue states, but there will be a bit of a compound effect and kind of overall sales," Massingue said regarding the effect of a second Trump administration on the US EV market. Despite the challenges, Massingue expects annual EV growth in 2025 to "probably be similar to 2024."

The EV tax credit has driven a nascent US metals industry, as companies seek to build production and processing inside the country's borders to supply domestic automakers. Removing the tax credit could also entice more EV makers to buy from China, which has a dominant position on processing most battery metals. However, dropping the tax credit would require legislative action by Congress.

Anti-pollution rules finalized last year to push the country's consumer and heavy-duty vehicle fleets toward zero emissions and accelerate the transition to EVs are likely on the chopping block as well.

Officials said an executive order would halt "efforts to curtail consumer choice" on products like shower heads, gas stoves and dishwashers. The Biden administration set new energy conservation standards for about two dozen product classes, reviewed potential health hazards of gas cooking equipment and enacted policies to support building electrification -- actions that Republicans, some Democrats and industry groups framed as a regulatory assault on gas appliances.

Climate path

As previously indicated, Trump intends to issue an executive order to once again withdraw the US from the Paris Agreement on climate change. The executive order will direct the US Department of State to notify the United Nations of the US plan to leave the global compact. It would take a year for the severance to take effect.

The US would join Iran, Libya and Yemen, which signed but never ratified the Paris accord. The US, the world's second largest emitter of climate-warming greenhouse gas emissions, is the only country to withdraw, and to do so twice.

The prospect of another US departure has concerned other nations but is also expected to make fewer diplomatic waves than during Trump's first term. China has emerged as a major geopolitical force in the renewables space and could gain in influence when the US steps aside, analysts predict.

"China sort of views itself as the leader of the developing country bloc," Samantha Gross, director of the Brooking Institution's energy security and climate initiative, said at a Jan. 13 panel discussion. "It'll be interesting to see, if the US steps aside, whether they'll change their position as the leader of the developing world to the leader of the world."

Under Biden, the US recently updated its climate goal -- known as the nationally determined contribution -- to cut its economywide greenhouse emissions by 61%-66% by 2035 from 2005 levels, and specifically cut methane emissions by 35% over the next decade.

Blue states representing 55% of the US population have reiterated their pledge to continue to deploy renewables and to stick with their Paris-aligned climate goals.

Trade policy

Trump is expected to announce a "America First Trade Policy," the White House said. It did not provide details, but Trump previously vowed to impose a 25% tariff on products imported from Canada and Mexico to apply pressure on the countries to enact policies tied to illegal drugs and immigration. Trump also vowed an additional 10% tariff on goods from China, calling for tougher policies on fentanyl, and said he would impose tariffs on the EU if they do not buy more US oil and gas.

However, Trump will not impose any tariffs on his first day in office. Instead, Trump will call for "federal agencies to investigate and remedy persistent trade deficits and address unfair trade and currency policies by other nations," according to a Wall Street Journal story that cited a presidential memo.