It seems impossible to escape the build-up to November 5, the day of the US Presidential election. While it is the end of the campaign, it is nevertheless in some respects only a beginning. Investors, regulators, and climate advocates know that January 20, 2025, is the day when the real action begins. That is when policies will start being implemented by a new administration.

In terms of policies, whether voters choose Kamala Harris or Donald Trump, it will send the US down very different roads on energy and environmental policy. The impact of their decision will be felt not only in America but across the world. This piece examines the implications of a Harris or Trump administration both for US domestic policy and internationally.

Stay on these roads – Continuity Biden

If Vice President Harris, wins it is likely she will continue many of the policies and programs of the Biden Administration. While candidate Harris has not laid out a specific set of climate related policies, on the campaign trail she does consistently promote government efforts to boost green energy markets and clean production.

It is also important to remember that, during Biden’s term, Harris cast the tie-breaking vote to pass the Inflation Reduction Action (IRA). It is highly likely she will make sure all the money ($369 billion in climate-related activities) in the IRA is spent. In the spring it was estimated that there is still $85 billion in funding not yet spent.

While Harris has been light on saying what she will do about climate and energy policy, we do know what she will not do.  She will be unlikely to overturn any of the Biden Administration’s Executive Orders that deal with electric vehicles, climate risk disclosure, or carbon neutrality. Her U-turn on fracking during the election campaign also indicates that she will probably be “continuity Biden” in maintaining domestic oil and gas production.

A different path from Harris

Since Trump is the first US President since 1892 to lose his re-election bid and run four years later, we have already seen how he will act in office. On climate change and energy policy we would likely see Trump withdraw the US from the Paris Agreement, appoint judges who would restrict the power of regulatory agencies to act, repealing Executive Orders on the social cost of carbon, and defund clean energy programs.

However, a second term for Trump would not merely be a repeat of his first four years. Trump and his supporters have laid out further actions they would take on climate and energy. Some of these actions include limiting tax credits on electric vehicle purchases, stopping the expansion of the electrical grid for wind and solar energy, appointing commissioners to the independent Securities Exchange Commission (SEC) who oppose ESG investing, and would want to eliminate the commission’s climate risk disclosure requirements.

On the IRA, it is not clear how Trump will act. It has been reported Trump would consider rescinding any unspent funding in the legislation. While he might want to reverse the IRA entirely that would be difficult to do as many of the legislation’s clean energy infrastructure projects are proceeding at state level.

But even more divergence internationally

While Kamala Harris can largely be expected to continue the Biden administration’s domestic agenda, she might plausibly lean more into a more ambitious approach overseas. While there has been no hint that she would seek to resurrect the idea of a “clean energy OPEC’ that she floated when she briefly ran as a Democratic presidential candidate in 2020, her Californian background might make her inclined to support just transition principles and to engage with the Global South. A constructive approach towards the UN and multilateralism can also be anticipated.

Donald Trump, by contrast might want to rip up the international rulebook entirely. There have been suggestions that a US exit from Paris would not suffice and that he would want the US to abandon the UN Framework Convention on Climate Change (UNFCCC) altogether. That would certainly detonate US multilateralism; although it’s worth recalling that the US’s decision in 2017 to withdraw from Paris had less impact on the UNFCCC process than Trump might have anticipated. What the abandonment of the UNFCCC would likely accentuate, however, would be the breakdown of any dialogue with China on climate change.

The US-China relationship on climate is arguably essential to any international settlement which can keep 1.5C alive. But the US-Europe relationship matters too; Trump seems to care little for Europe, and the EU’s carbon border adjustment tax (the CBAM) would presumably serve to wind him up more as it is implemented over the next period.

For Harris and Trump all roads lead to…

It’s a cliché to say America is a divided nation. While Vice President Harris and former-President Trump have radically different positions on much of this agenda, there are places of common ground.

One area we see this in is trade and tariffs. In May 2018, President Trump imposed tariffs on solar panels. At the time it was called a blow to renewable energy production in the US. Once in office the Biden Administration, instead of repealing it as would have been expected of  a pro-trade administration, increased the tariffs and had them cover electric vehicles made in China. Since both candidates continue to support keeping these policies, they may well remain in place for years to come.

In addition, whoever wins in November, America will have an administration which supports the increased use of nuclear power. Over the last eight years both the Trump and Biden-Harris administrations have spent billions to boost the growth of nuclear power. At the time, nuclear power also enjoys bipartisan support in Congress. Against this background, it would be no surprise if energy legislation in the next Congress features increased funding for nuclear energy.

The next step, not the last stop

The November election is critical for climate and energy policy in the US, but it won’t be the end, whatever happens. We live in times of great change that go beyond the ballot box. We have seen rapid and profound shifts in the energy sector and in our climate that will continue for years to come.  To illustrate that point, commentators like Head of History at Columbia University and Financial Times columnist Adam Tooze maintain that the election will not even be the most significant climate-related event of the next few months, but that will be China’s next emissions reduction NDC plan.

These changes have brought anxiety and some instability, and they are just starting to ripple through the corridors of power and finance with profound consequences for both. Whether Harris or Trump can seize this moment and provide the leadership America needs to turn uncertainty into opportunity, could be a key judge of whether their administration is a success.