The solution to the Covid-19 pandemic was not found in government lockdowns, but in unleashing the innovative capacity of American science to discover vaccines and the ability of American industry to produce them. Similarly, the solution to the climate challenge will not come from growth-inhibiting government regulations in a smaller and poorer America that produces less carbon dioxide. It will come from a powerful and prosperous America, with a vibrant private sector spending generous amounts of research and development money on technological solutions.

Private sector competition and innovation must drive progress, not the government picking winners and losers through myriad incentives, tax credits, and distortionary subsidies. Embracing a policy approach of encouraging competition and innovation will also enable America’s fossil fuel industry to both expand and become cleaner and more efficient—as it has already been doing for decades, with extraordinary results. For instance, the United States led the world in emissions reductions between 2005 and 2020, reducing its emissions by 1,423 million metric tons—a 24 percent decline. Compare this to the world’s second-largest economy, China, where emissions increased by 3801 million metric tons over the same period.

In keeping with these principles and a commitment to an “all-of-the-above” model, three policy recommendations stand out:

First and foremost, permitting regulatory modernization and reform is critical. Despite three recent bills on energy and related issues and outlays of more than $1.5 trillion in federal spending, these barriers to growth are still there. A prime example is the forty-year-old and heavily litigated National Environmental Policy Act. At present, infrastructure permits face average delays of more than four years (five years for nuclear) because of environmental impact statements alone. The permitting process also costs the applicants millions. Streamlining environmental reviews and permitting will bring more natural gas, nuclear, renewables, transmission, efficient manufacturing, and resilient infrastructure online faster. In fact, NEPA red tape disproportionately affects clean energy, transmission, and conservation-related projects.

Congress must also take on a difficult fight and establish statutory guidelines for executive agencies to halt the anti-growth climate-related mission creep at nearly every agency. This would protect the industry from regulatory uncertainty such as that initiated by the State Department’s revocation of the Keystone XL pipeline permit. New statutory guidelines would also help halt the Securities and Exchange Commission’s flagrant attempt to impose regulations akin to social credit programs, such as its climate-related disclosure rule. Congress would also be wise to embrace policies like the One Federal Decision Framework, which would eliminate redundancy in environmental assessments.

The Nuclear Regulatory Commission (NRC) must quicken the pace to approve and certify small modular nuclear reactors (SMRs) and advanced reactors. The NRC recently certified NuScale’s SMR for use in the United States, but it took six years. NuScale spent over $500 million and two million labor hours to complete the applications. SMRs are a promising technology to meet the world’s energy needs and climate objectives but the current pace for approval is far too slow. Holding back American nuclear energy companies could also cede ground on the international stage to China and Russia, whose state-owned nuclear firms are building facilities in places like Africa.

Second, U.S. policies must reject outsourcing emissions to adversarial nations like China, Iran, Russia, and OPEC that extract, mine, process, and refine less efficiently than the United States. The United States must ensure a stable base from which to grow and expand innovation to responsible mining and processing of uranium, critical minerals, and rare earth elements. U.S. allies, through the process of near-shoring, should also play a critical role in establishing resilient supply chains. Americans should never be presented with the false choice of picking between child labor in Congo or Uyghur slave labor in China.

Third, beyond continued investment into critical science, technology, engineering, and math (STEM) early educational programs, state and federal policies must also encourage a new generation of innovators and engineers to carry the torch farther. At present, market opportunities for nuclear engineers are set to decline 8 percent by 2030 while the number of new entrants in petroleum engineering has declined for seven consecutive years. Embracing an all-of-the-above energy policy, in which policymakers and elected officials do not pick winners and losers, will go far in reversing this trajectory.

Conclusion

The reduction of CO2 emissions, a worthwhile objective, should not come at the price of putting America’s fossil fuel industry—or the energy industry writ large—in a straitjacket through government regulations, which in turn will lower economic growth and could realistically increase emissions by offshoring them. On the contrary, the solution to the climate change challenge will come from innovation generated in the private sector, especially in America’s energy industry.  An “all-of-the-above” energy policy will unleash the potential of all segments of the U.S. energy industry, the solid foundation needed for a strong and prosperous America.

Dan Negrea served at the US State Department as a member of the Secretary’s Policy Planning Staff and as the Special Representative for Commercial and Business Affairs.

Sam Buchan is the Director of the Center for Energy and Environment at the America First Policy Institute.  He served as the Director for International Economic Policy at the National Economic Council and as a Senior Advisor to the Secretary of Energy.

Nick Loris is the Vice President of Public Policy at the Conservative Coalition for Climate Solutions. He testifies often before Congress on energy, climate, and environmental issues.

Image: Reuters.