Energy Blog: Calm in the Midst of an Emergency
When presidents first take office, they usually want to work fast to set into motion the policies that won them the office. Often that means giving a speech to a joint session of Congress to lay out a legislative agenda, which places the fate of a president’s agenda outside his immediate control.
More direct action is assured through the issuance of an executive order, which is a set of written instructions for the agencies under the president’s authority to carry out new policies. Executive orders are not without their critics, and the policy directives only last as long as the issuer’s term of office, but for a politician who campaigned on accomplishing certain benchmarks “on Day One,” there’s no substitute for signing a piece of paper.
On the first day of Donald Trump’s return to office, he signed dozens of executive orders to change policies both large and small. For engineers in the power industry, the halting Federal permitting of wind power projects will have an immediate impact, since the scope of the executive order is broad enough to affect any wind power project that has not received every last necessary approval.
More Energy Blogs: Three Trends in Electric Generation
This order extends to both onshore wind farms as well as offshore farms. Any utility operator who was planning on adding wind power to the generating portfolio, perhaps to help replace the electricity from coal power plants scheduled to retire, must now find an alternative.
Given President Trump’s well-documented disapproval of wind power, such an order was expected, though perhaps not its sweeping scope.
The other executive order which impacts the energy industry is a declaration of an energy emergency. This order rolls up a number of policy objectives, and by invoking the National Emergencies Act, the president has given himself the power to circumvent many of the restrictions that would otherwise limit his actions.
“The United States’ insufficient energy production, transportation, refining, and generation constitutes an unusual and extraordinary threat to our Nation’s economy, national security, and foreign policy. In light of these findings, I hereby declare a national emergency,” the order states.
Energy Trends: Solar Momentum Can’t Be Stopped, Experts Report
The order specifies a long set of actions and policy changes. But invoking energy shortages at this time seems at odds with the present reality.
According to the Energy Information Administration (EIA) energy prices are well within norms for recent years and down quite a bit from the spike seen in 2022. On Inauguration Day, the average retail price for gasoline was $3.16 per gallon, which is lower than what it was in 2011 through 2014 in spite of inflation in other sectors of the economy. Likewise, a recent run-up in natural gas prices due to a cold wave gripping most of the continental U.S. hardly constitutes an emergency, especially since prices are lower than during a similar squeeze in 2018.
What’s more, the EIA’s “Short-Term Energy Outlook,” published January 14, did not project shortages or price increases in the coming weeks or months. Despite the executive order’s emphasis on boosting oil production, the industry doesn’t appear to need any goosing, based on the EIA analysis.
“After reaching an annual record of 13.2 million b/d [barrels per day] in 2024, we forecast U.S. crude oil production will increase to 13.5 million b/d this year,” the report stated. “We expect crude oil production to grow less than 1 percent in 2026, averaging 13.6 million b/d as operators slow activity due to price pressures. WTI prices average $62 per barrel in 2026 in our forecast, down from $70 per barrel in 2025.”
Rather than regulatory burdens, it is pressure from low prices that is limiting production.
In addition, the U.S. electric generation sector is expected to see a large influx of solar power over the next 24 months, totaling 48 GW. That growth, combined with relatively flat demand, is forecast to reduce the amount of electricity from gas-fired power plants.
Invoking an emergency unlocks the power to cut through legal barriers, which is no doubt what President Trump intended. But for a segment of the economy in a declared emergency, the U.S. energy sector is both calm and growing.
Jeffrey Winters is editor in chief of Mechanical Engineering magazine.
More direct action is assured through the issuance of an executive order, which is a set of written instructions for the agencies under the president’s authority to carry out new policies. Executive orders are not without their critics, and the policy directives only last as long as the issuer’s term of office, but for a politician who campaigned on accomplishing certain benchmarks “on Day One,” there’s no substitute for signing a piece of paper.
On the first day of Donald Trump’s return to office, he signed dozens of executive orders to change policies both large and small. For engineers in the power industry, the halting Federal permitting of wind power projects will have an immediate impact, since the scope of the executive order is broad enough to affect any wind power project that has not received every last necessary approval.
More Energy Blogs: Three Trends in Electric Generation
This order extends to both onshore wind farms as well as offshore farms. Any utility operator who was planning on adding wind power to the generating portfolio, perhaps to help replace the electricity from coal power plants scheduled to retire, must now find an alternative.
Given President Trump’s well-documented disapproval of wind power, such an order was expected, though perhaps not its sweeping scope.
The other executive order which impacts the energy industry is a declaration of an energy emergency. This order rolls up a number of policy objectives, and by invoking the National Emergencies Act, the president has given himself the power to circumvent many of the restrictions that would otherwise limit his actions.
“The United States’ insufficient energy production, transportation, refining, and generation constitutes an unusual and extraordinary threat to our Nation’s economy, national security, and foreign policy. In light of these findings, I hereby declare a national emergency,” the order states.
Energy Trends: Solar Momentum Can’t Be Stopped, Experts Report
The order specifies a long set of actions and policy changes. But invoking energy shortages at this time seems at odds with the present reality.
According to the Energy Information Administration (EIA) energy prices are well within norms for recent years and down quite a bit from the spike seen in 2022. On Inauguration Day, the average retail price for gasoline was $3.16 per gallon, which is lower than what it was in 2011 through 2014 in spite of inflation in other sectors of the economy. Likewise, a recent run-up in natural gas prices due to a cold wave gripping most of the continental U.S. hardly constitutes an emergency, especially since prices are lower than during a similar squeeze in 2018.
What’s more, the EIA’s “Short-Term Energy Outlook,” published January 14, did not project shortages or price increases in the coming weeks or months. Despite the executive order’s emphasis on boosting oil production, the industry doesn’t appear to need any goosing, based on the EIA analysis.
“After reaching an annual record of 13.2 million b/d [barrels per day] in 2024, we forecast U.S. crude oil production will increase to 13.5 million b/d this year,” the report stated. “We expect crude oil production to grow less than 1 percent in 2026, averaging 13.6 million b/d as operators slow activity due to price pressures. WTI prices average $62 per barrel in 2026 in our forecast, down from $70 per barrel in 2025.”
Rather than regulatory burdens, it is pressure from low prices that is limiting production.
In addition, the U.S. electric generation sector is expected to see a large influx of solar power over the next 24 months, totaling 48 GW. That growth, combined with relatively flat demand, is forecast to reduce the amount of electricity from gas-fired power plants.
Invoking an emergency unlocks the power to cut through legal barriers, which is no doubt what President Trump intended. But for a segment of the economy in a declared emergency, the U.S. energy sector is both calm and growing.
Jeffrey Winters is editor in chief of Mechanical Engineering magazine.
ME is Fully Digital
ASME members can access Mechanical Engineering magazine in its new, enhanced digital format. Everything you love about ME, now everywhere you go.
As renewable energy gains momentum, oil and natural gas continue to remain primary global energy sources. This collection delves into latest digital trends enabling breakthroughs in energy transformation.