# Joseph Aldy Assesses the Early Impacts of Trump 2.0 on Domestic Climate and Energy Policy in the Newest Episode of “Environmental Insights” March 10, 2025 The early days of the Trump administration foreshadow potentially significant changes for U.S. energy and climate policy. How those changes will play out over the coming months and years was the focus of discussion in the newest episode of “[Environmental Insights: Discussions on Policy and Practice from the Harvard Environmental Economics Program](https://soundcloud.com/environmentalinsights/),” featuring [Joseph Aldy](https://www.hks.harvard.edu/faculty/joseph-aldy), the Teresa and John Heinz Professor of the Practice of Environmental Policy at [Harvard Kennedy School](https://www.hks.harvard.edu/). The podcast is produced by the [Harvard Environmental Economics Program](http://www.heep.hks.harvard.edu/). Listen to the interview [here.](https://on.soundcloud.com/cFKjw4r1ESJkhLqS6) Hosted by [Robert N. Stavins](https://www.hks.harvard.edu/faculty/robert-stavins), A.J. Meyer Professor of Energy and Economic Development at [Harvard Kennedy School](http://www.hks.harvard.edu/) and director of the [Harvard Environmental Economics Program](http://www.heep.hks.harvard.edu/) and the [Harvard Project on Climate Agreements](https://www.belfercenter.org/project/harvard-project-climate-agreements), Environmental Insights is intended to promote public discourse on important issues at the intersection of economics and environmental policy. Aldy, who served as a climate advisor during the Obama administration and is a University Fellow at [Resources for the Future](https://www.rff.org/) and a Faculty Research Fellow at the [National Bureau of Economic Research](https://www.nber.org/), described how the Trump administration has moved quickly on many fronts using a variety of executive orders, rolling back regulatory policies, and creating a National Energy Dominance Council to confront what it has termed a “national energy emergency.” “It's a little bit of a challenge to say we're actually dealing with a kind of energy emergency that was described by the president because we're producing more energy now than we ever have,” said Aldy. “When we look at the fact that we're at record highs in oil production, gas production, and renewable power production on the supply side, we're not necessarily facing what one might think of as an emergency when it comes to energy.” That said, Aldy stated that he is alarmed by some of the brazen early moves the administration is making in the energy and climate space. “We see efforts going on now that I think are potentially more fundamental in undermining the ability of the federal government to regulate greenhouse gas emissions. Tasked on day one to EPA was to assess the prospect of undoing the [Endangerment Finding](https://www.epa.gov/climate-change/endangerment-and-cause-or-contribute-findings-greenhouse-gases-under-section-202a) under the [Clean Air Act](https://www.epa.gov/laws-regulations/summary-clean-air-act). That's the necessary foundation \[for\] the EPA \[to exercise its\] authority to regulate greenhouse gas emissions,” he said. “They're moving in that direction, and a lot of this is going to end up in the courts.” The courts may not be so sympathetic toward the administration, Aldy contended. “Part of the response from those who want to slow this kind of retrenchment when it comes to clean energy and climate policy is to litigate and some of what is happening is happening so fast. I mean, we saw this in Trump 1.0 where some things they try to do very quickly. What they did was not consistent with the process that is established under current law that you're supposed to follow, or you will be found to have been in the language of the Administrative Procedure Act that governs how we implement the administrative state, ‘arbitrary and capricious.’ You lose in the courts on process grounds, not even on the merits,” he stated. Aldy also argued that the administration seems to be pursuing a number of countervailing objectives using a variety of tools that may cause unintended consequences. “The prospect of tariffs generally really interact with an agenda focused on trying to advance oil and gas development in the United States. If we are going to put tariffs on imported steel \[the price of oil extraction will go up\],” he remarked. “So, \[when\] importing crude oil, natural gas, or electricity from Canada… with tariffs, \[it will\] make \[those\] more expensive domestically and affect… both the business case for using energy as well as the domestic politics about energy.” The clean energy tax credits contained in the Inflation Reduction Act may also be in jeopardy, Aldy contended, although he admitted there may be pushback from some Republicans representing areas where the tax credits have had a significantly positive economic impact. And those may be key votes, Aldy says, when the president’s proposed tax cuts come before Congress. “I think there were more than a dozen Republicans who voted against the tax bill, the Trump tax cuts of 2017, in the House of Representatives. They can't lose a dozen votes this time. It's a much tighter margin. And so, there's a question about, is there sufficient support for sustaining at least some clean energy tax credits going forward?,” Aldy said. Aldy did express his belief that even if the administration is successful in efforts to slow down the clean energy transition, it won’t be able to stop it altogether. “The clean energy economy in the U.S. is so much more advanced now that signing executive orders doesn't affect the 30-plus gigawatts of solar that was installed last year. It doesn't affect the fact that we have been installing more wind power every year for the past decade than we have natural gas in terms of incremental capacity investment. All… the people who recently bought EVs, they're still going to drive their EVs. We're still going to produce power from these renewable power facilities,” he argued. “I think that we're going to see more and more business investment because the business case for clean energy is getting better and better even if the policy environment is getting more uncertain,” he said. “It means that the worst-case scenario, at least in terms of what happens to our emissions and our energy economy, is basically like stasis. We need to accelerate if we're going to be up to the challenge of the problem, but I think we just find ourselves treading water for a while. The challenge is whether or not there's really bad spillovers to other countries.” Aldy’s interview is the second episode during 2025 in the [Environmental Insights](https://soundcloud.com/environmentalinsights/) series, with additional episodes scheduled to drop each month. “Environmental Insights is intended to inform and educate listeners about important issues relating to an economic perspective on developments in environmental policy, including the design and implementation of market-based approaches to environmental protection,” said Stavins. “We speak with accomplished Harvard colleagues, other academics, and practitioners who are working on solving some of the most challenging public problems we face.” Environmental Insights is hosted on [SoundCloud](https://soundcloud.com/environmentalinsights) and is also available on [Amazon Music](https://music.amazon.com/podcasts/cd70f458-c1f4-4f11-bf64-c9e0dc71ee5b), [Apple Podcasts](https://podcasts.apple.com/us/podcast/environmental-insights-conversations-on-policy-practice/id1482761966), [Pocket Casts](https://pca.st/keck3o78), [Podcast Addict](https://www.podcastaddict.com/podcast/3374959), and [Spotify](https://open.spotify.com/show/6WBWmeXTH90a3DoOYpXlhX). **LINK TO PODCAST:** See also:- [ 2025 ](/news-year/2025) Share on:- [ Facebook ](#) - [ Twitter ](#) - [ Linkedin ](#)