To the leaders of the Massachusetts clean-tech sector, President Trump’s decision to pull out of the Paris Agreement represented an unfortunate but largely symbolic blow.
The bigger threat, they say, can be found in a recently released federal energy budget that proposes drastic cuts to research funding.
Local clean-tech executives initially held out hope that Trump wouldn’t follow through on his campaign promise to leave the Paris climate accord, a global pact that calls for big reductions in greenhouse-gas emissions.
The president’s withdrawal, they say, sends a discouraging message to clean-tech entrepreneurs and puts the country at risk of falling behind in the race to develop new renewable technologies.
But state officials have considerable power over energy and environmental policies — a fact underscored by governors, including Governor Charlie Baker, who quickly joined together to form the US Climate Alliance in repudiation of Trump’s move. Massachusetts remains on track for substantial greenhouse gas reductions of its own, regardless of the country’s withdrawal from the Paris treaty.
The legislature last summer passed an energy bill that requires big contracts for Canadian hydropower and wind power. Massachusetts, like many states, imposes strict renewable energy purchase requirements of its major utilities. And it participates in a multistate effort to control carbon dioxide emissions across the Northeast.
Those efforts won’t be derailed by the Paris decision.
Trump sees this move as a way to help stoke the nation’s coal industry. But coal’s importance is expected to dwindle anyway. New England’s largest coal plant, the Brayton Point complex in Somerset, closed for good this week. The main reason: It simply couldn’t compete with cheaper natural gas-fired plants.
Nearly 66,000 people work in the coal industry nationwide, compared to roughly 100,000 clean-energy jobs in Massachusetts alone.
“Some of the jobs the president has talked about saving are not being lost because of climate accords or addressing climate change,” said Janet Gail Besser, executive vice president at the Northeast Clean Energy Council. “They’re being lost because the economics are not there.”
The bigger threat could come from federal fiscal policy, not foreign policy.
Besser said she’s concerned about federal tax credits for wind and solar industries. Congress reached an agreement in late 2015 to extend these credits for several more years, but Besser worries their demise could be hastened as part of a broader tax package from the Trump administration.
Trump is already trying to take an ax to renewable energy programs. The president proposed a 69 percent cut to the Office of Energy Efficiency and Renewable Energy, which funds advances in everything from automobiles to wind power.
More troubling for Massachusetts: Trump proposed eliminating the “ARPA-E” program, which subsidizes high-tech energy research. Massachusetts has been the second largest beneficiary of ARPA-E grants after California, with more than $150 million flowing into the state since the program’s inception in 2009.
“Losing that support for federally funded research probably hurts us more than other states because we have so much going on here,” said David O’Connor, an energy specialist at Boston lobbying firm ML Strategies.
Chat Reynders, CEO of Boston investment firm Reynders, McVeigh, said governments in other countries will continue to pump funds into early-stage energy research.
“My worry is what happens now in the United States. It’s going to be all on the shoulders of venture firms, or firms like ours who have angel investors who want to make a difference,” said Reynders, whose firm specializes in socially conscious investments. “We’re going to be at an extraordinary disadvantage.”
These programs could be saved by defenders in Congress. But the industry is still bracing for a funding slowdown.
This makes for a troubling time in the clean-tech sector.
“Our employees here felt a sense of dejection yesterday and a sense of embarrassment on behalf of the leadership of our country,” said Tim Healy, chief executive of Boston energy management firm EnerNOC Inc.
But Healy remains hopeful that leaders in his industry can rise to the challenge.
“It’s demoralizing on day one, and it’s incredibly motivating on day two,” Healy said. “What we’re doing ... is now even more important. It allows for this sector to send out a rallying cry.”Jon Chesto can be reached at email@example.com. Follow him on Twitter @jonchesto.