3 days Ago By Marion Rae
Climate investors are taking the prospect of a "Trump II" era in their stride with the looming boon for fossil fuels not expected to wipe out growth for clean energy. "Sentiment will dampen but investment will not," David Scaysbrook, co-founder and managing partner of renewable energy investment leader Quinbrook Infrastructure Partners told AAP. "While there will be policy shifts they are not likely to be anti-renewables and most certainly won't be aimed at slowing down the huge momentum built up under the Inflation Reduction Act.
" The package of laws unleashed billions of dollars in the United States and gave Australians preferential access as trusted partners in a sovereign critical minerals and clean energy supply chain. Almost 18 months ago, US President Joe Biden and Prime Minister Anthony Albanese declared climate change, critical minerals and clean energy as the "third pillar" of an alliance that has been a solid security and economic partnership for decades. Over the next 10 years, $US1.
5 trillion was expected to flow to manufacturing, electric vehicles and clean energy. Donald Trump pledged in September to "rescind all unspent funds" under what he said were misnamed laws and "end the EV mandate on day one". But Mr Albanese said on Friday he had a "really warm" phone call with Mr Trump about their common interests, ahead of the official inauguration ceremony in January.
"Australia and the United States are great friends. And we reaffirmed that ..
. it was a very good beginning to what will be an important relationship," he said. According to Mr Scaysbrook, Australia stands to benefit from its critical resources endowment and its position as an ally.
That includes a role in onshore processing and export of critical minerals for battery and solar equipment manufacturing in the US, which he expects "Trump II" to incentivise. Australia may be a top source of critical minerals and rare earths, but China still has a stranglehold on factory-ready materials that American manufacturers rely on. While there may be a boost for fossil fuels over the coming few years, he said he does not expect it to be at the expense of renewable energy investment.
Energy demand is forecast to keep rising in the US as power-hungry data centres proliferate to warehouse the mountains of information behind apps and services in the age of artificial intelligence. Former Liberal energy minister Matt Kean, now head of the federal Climate Change Authority, told an investment summit that Australia was well-placed to capitalise on demand, with its access to capital, natural resources and capacity for innovation. "If other countries want to retreat from that opportunity we should double-down on our determination to seize the economic upside available," he said after Mr Trump claimed victory.
Mr Trump has promised to withdraw the US from the landmark Paris Agreement - again - saying climate change is a "hoax" and will boost oil production. Woodside Energy CEO Meg O'Neill has congratulated him, saying she looks forward to working with the incoming administration - and leaders on both sides - to deliver lower-carbon, low-cost energy. At an investor briefing in Karratha on Thursday, Ms O'Neill reiterated that the Woodside's Louisiana LNG project was fully permitted up to the 27.
6 million tonnes per year capacity, which meant it was not impacted by an approvals pause in the US earlier this year. Similarly, the Texas Clean Ammonia Project in Beaumont is already under construction and is around 70 per cent complete, a Woodside spokesman said. Meanwhile states from California to New York are already moving to "Trump-proof" their laws to safeguard clean energy progress, in a country where ageing assets need replacing similar to the scenario facing Australia.
Solar and wind are the fastest growing sources of energy generation on the power grid, according to the US Department of Energy. Not dependent on generous Biden-era tax credits alone, ever-cheaper technology is driving costs down for clean energy developers and state renewable energy mandates have long been at work in the coastal states that did not fall to Republicans. Mr Trump's victory also comes as leaders, investors and lobbyists prepare for the next UN climate conference COP29 that begins on Monday in Baku, in oil and gas-rich Azerbaijan.
With the planet on track for its hottest year on record, according to the World Meteorological Organisation, talks are expected to focus on keeping a lid on global warming and not stopping the flow of trillions in investment needed for clean energy to replace fossil fuels. Despite being dubbed the "Finance COP", agreement may again stall on a new global climate financing target after three years of talks. Rich countries met the original commitment of $US100 billion for the first time in 2023, according to OECD data, which missed the goal of achieving that level by 2020.
Developing economies, including Australia's neighbours in the Pacific, are demanding a new target of at least US$1 trillion to help them invest in the energy transition and withstand climate change. Rebecca Mikula-Wright, chief executive of the Investor Group on Climate Change, said a Trump presidency would not change the economic and investment case for climate action. "While it will be a bump in the road, the Trump presidency can't stop the transition to clean energy the world started over 20 years ago," she told AAP.
"The shift to a clean economy remains the single biggest economic opportunity for our nation and the retirement savings of millions of Australians," she said. She said continuing to roll out renewable energy and investment in new industries would result in Australians having an additional $7-8 trillion in their wallets over the next 25 years, compared to delaying and letting global warming rip. "Renewable power is the cheapest form of new electricity in the world and the industry now employs more people than coal, oil, gas and nuclear combined," she said.
"We have the best clean energy resources in the world which will lower the cost of living and power bills, keep the lights on, and provide secure job opportunities.".
