TRUMP FACES DIVISIONS ON CLIMATE PACT
Pro-Paris bloc, energy firms lobby for deal, writes Jennifer A. Dlouhy.
As U.S. President Donald Trump contemplates whether to make good on his campaign promise to yank the United States out of the Paris climate accord, an unlikely lobbying force is hoping to talk him out of it: oil and coal producers.
A pro-Paris bloc within the administration has recruited energy companies to lend their support ahead of a high-level White House meeting on the subject, according to two people familiar with the effort who asked not to be identified.
Cheniere Energy, which exports liquefied natural gas, became the latest company to weigh in for the pact to cut greenhouse gas emissions in a letter Monday solicited by White House energy adviser G. David Banks.
“Domestic energy companies are better positioned to compete globally if the United States remains a party to the Paris agreement,” Cheniere wrote. The accord “is a useful instrument for fostering demand for America’s energy resources and supporting the continued growth of American industry.”
Exxon Mobil Corp., previously led by Secretary of State Rex Tillerson, Royal Dutch Shell Plc and BP Plc also have endorsed the pact.
The industry campaign to stick with the Paris accord comes amid deep divisions in the Trump administration over the carboncutting agreement. Both the president’s daughter, Ivanka Trump, and her husband, Jared Kushner, a White House special adviser, have urged the president to stay in the deal, along with Tillerson.
On the other side are senior adviser Stephen Bannon and Environmental Protection Agency Administrator Scott Pruitt, who on Friday said “we need to exit” the pact.
Gas producers and exporters are highlighting the value of the agreement, which could help prod a worldwide move toward that fossil fuel.
Exxon Mobil argued in a letter last month that U.S. slashed its carbon emissions to 20-year lows because of greater use of natural gas, and “this success can be replicated globally” as part of the accord.
BP spokesman Geoff Morrell said the company continues to support the Paris deal, noting that “it’s possible to provide the energy the world needs while also addressing the climate challenge.” And Shell spokesman Curtis Smith said the company remains “strongly in favour” of the agreement.
Coal producers Cloud Peak Energy Inc. and Peabody Energy Corp. also are lobbying in favour of the accord, even though the miners could be disadvantaged by a global shift toward cleaner sources of electricity. Cloud Peak pitches the Paris agreement as a platform for the U.S. to advocate using carbon capture and other high-efficiency, low-emissions technology to generate electricity from coal.
Trump is nearing a decision on whether he will fulfil repeated pledges to withdraw the U.S. from the accord he previously derided as “bad for U.S. business.” The White House postponed a planned Tuesday meeting of senior administration officials, including Pruitt, Tillerson, Kushner and Bannon, to go over the pros and cons of staying in the agreement, according to an aide citing a scheduling conflict.
The administration will decide what to do before late next month, when world leaders gather for the Group of Seven summit in Italy, White House press secretary Sean Spicer said.
Not every energy executive is on board. Coal baron Robert E. Murray has been outspoken in criticizing the deal, arguing it’s “just a way for other countries to get American money.” Chevron Corp. chief executive John Watson said in a Columbia University Center on Global Energy Policy podcast that more needs to be known about how the Paris accord will translate into policy under Trump. And some independent oil companies — those without significant gas production that could benefit from greater international demand — have quietly opposed the pact.
Perhaps for that reason, the leading oil industry trade group, the American Petroleum Institute, has not taken a formal position on the Paris agreement. Instead, API spokesman Michael Tadeo casts the accord as a missed opportunity to talk about U.S. leadership “in reducing carbon emissions which are near 30-year lows in electricity generation due to increased use of natural gas brought by hydraulic fracturing.”
Trump has already moved to dismantle a raft of Obama-era climate policies that would help the U.S. satisfy the commitment it made with more than 190 other nations to slash greenhouse gas emissions. His budget director, Mick Mulvaney, described plans to cut government spending on climate change as stopping a “waste” of taxpayer money. And energy ministers from G7 nations earlier this month took the unusual step of declining to issue a joint statement endorsing the Paris agreement after the U.S. balked.
The Paris agreement itself is really an array of individual, country-specific pledges, such as the U.S. promise to cut greenhouse gas emissions at least 26 per cent from 2005 levels by 2025. It is not legally binding and there are no formal sanctions in place for failure to comply.
White House officials who support Paris highlight the lack of repercussions. A key argument is that the U.S. can stay in the agreement without satisfying its pledge or maintaining regulations designed to help achieve the target, said one administration official.
Remaining in the pact preserves options for the White House — even years down the line, ClearView Energy Partners said in a research note to clients Monday. There’s no near-term imperative to abandon it, ClearView said, but there may be a political incentive to wait: “The Trump administration might want to keep Paris defection in its pocket, because jettisoning it later could serve as a way to gin up political support closer to the 2020 re-election race.”
Trump can’t pull the U.S. out of the pact immediately, though he could begin a four-year process of withdrawing. And he has several possible techniques for formally extricating the U.S.: He can make the change unilaterally or punt the decision to the Senate, by interpreting the accord as a treaty that requires the support of twothirds of the chamber’s members to be ratified. That’s currently an insurmountable political hurdle.