The simple solution to the ‘Californication’ of American energy policy

President-elect Trump distills his energy policy in just three words: "Drill baby, drill." 

Last week, the incoming president outlined the executive actions he would take on Day One to reignite American energy production. Foremost among them is replenishing the Strategic Petroleum Reserve and greenlighting natural gas export permits.

But in addition to boosting natural gas, Trump wants to usher in a nuclear renaissance by building new nuclear energy power plants across the country. His all-of-the above approach to power generation stands in stark contrast to Gov. Gavin Newsom, whose "climate-friendly" policies in California have gouged citizens and created one of the most unreliable grids in the United States.

The president-elect and the California governor embody polar opposite mindsets when it comes to power production: Trump represents a mindset of energy abundance while Newsom represents a mindset of energy scarcity. 

TRUMP’S ENERGY AGENDA CAN MAKE AMERICA AFFORDABLE AGAIN

One mindset leads to prosperity; the other to ruin. For the United States to remain atop the global economy, Washington must embrace the abundance mindset and resist the "Californication" of American energy policy at all costs.

The energy abundance mindset embraced by Trump equates energy usage with human flourishing. It recognizes that energy has always been the key to civilizational progress, scientific advancement and economic growth—from the time man first learned to wield fire to his discovery of nuclear fusion. 

Energy usage is a good thing. And a healthy society seeks to promote, not constrain it.,

That’s why an abundance mindset sees America’s energy shortage and offers a simple solution: generate more using solar, wind, hydro, nuclear or natural gas. And don’t pick and choose who can use that energy in the process. Thanks to human ingenuity, there can be enough to go around.

I KNOW WHAT PRESIDENT TRUMP’S ENERGY POLICY WILL BE. I USED TO RUN HIS ENERGY REGULATORY AGENCY

By contrast, the energy scarcity mindset embraced by Newsom views power as finite and therefore in need of rationing. Moreover, it deems certain types of generation and usage as "bad."

The "bad" sources of energy must be eliminated. And with limited "good" energy to go around, the government must regulate its usage. This requires picking winners and losers among power producers and discriminating against end users.

Embracing an energy scarcity mindset would exacerbate, not solve, the nation’s energy crisis. It would introduce market inefficiencies that would ultimately stunt economic development and human progress. In assessing the dangers of this mindset, look no further than the damage Newsom has caused in California.   

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California has some of the most onerous power regulations in the country. The state discriminates between "good" and "bad" energy by mandating that 60% of all electricity come from renewable sources by the year 2030 and 100% by the year 2045. Some major cities have even banned natural gas connections in new buildings. 

Meanwhile, the state’s heavy-handed electric vehicle mandate has resulted in 1.2 million electric cars plugging into the grid. The state has effectively shrunk the pie of available energy, and mandated increased demand.

These measures burden the state’s creaking energy infrastructure, leaving consumers footing the bill. The state’s scarcity mindset has resulted in threats of rolling blackouts amid some of the highest power prices in the country, with Californians paying two times the national average for electricity and nearly 50% more for gasoline. 

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Just this month, a study from the University of Southern California predicted that Californians will pay $1,000 more for gas in the coming year because of the new regulations Newsom has imposed on the industry.

In contrast to California is a state like Texas, which Trump has looked to as a model of the energy abundance mindset.

Rather than picking winners and losers, Texas opens its doors to all-comers. It remains the nation’s leader in oil and natural gas production. But it also leads the nation in eco-friendly solar and wind generation.

Moreover, the state doesn’t discriminate against end users of electricity. Texas Gov. Greg Abbott has advanced policies to attract both AI and Bitcoin mining data centers to the state. And his abundance mindset has paid off in unexpected ways. 

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Bitcoin miners, for example, are key to scaling up renewable energy projects and bringing more natural gas generation online. That’s because miners can serve as guaranteed, flexible customers for new energy providers, using power that would otherwise go to waste but making it available when it is needed. Texas’s forward-thinking policies have thus created a win for power providers and consumers alike.

Texas’ energy abundance mindset has led to a booming job market, cheap power prices, and the cleanest energy mix in the country. It has ushered in a new era of economic growth as technology companies and energy pioneers flock to the state. In fact, the Census Bureau reported Americans’ largest state-to-state migration in recent years was from California to Texas.

While California is a cautionary tale, Texas is a case study in energy progress. For the United States to succeed under Trump, he must find a way to scale Texas’ success on a national level.

The Lone Star State demonstrates the virtues of approaching energy development as a win-win rather than a zero-sum game. And it provides a model for US policymakers to follow in their efforts to solve the energy crisis. 

By embracing an abundance mindset, Washington can unleash new possibilities for energy development and economic growth to secure American leadership on the global stage.

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Sam Lyman is the director of public policy for Riot Platforms Inc., the former chief speechwriter to Sen. Orrin G. Hatch, and the former speechwriter to the President and CEO of the U.S. Chamber of Commerce.