Octopus boss Greg Jackson says Trump victory is a warning over energy bills

The founder of Octopus Energy, Greg Jackson, has said the US election victory of Donald Trump should serve as a warning to other governments that talking up renewables, while not bringing down energy costs for consumers, loses votes.

Two days after Trump secured a return to the White House, Jackson said that Trumpian politics proves that what brings success at the polls is cutting people’s energy bills.

“The number one reason people voted for Trump was the economy and their quality of life, and at the end of the day, clean power and renewables are an opportunity to drop the cost of energy.”

And Jackson had a reality check over the Inflation Reduction Act, a piece of Biden legislation that was widely hailed as accelerating the US clean energy transition and leaving Europe in its wake.

“The Inflation Reduction Act sent seismic waves around Europe… but it didn’t bring bills down.”

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Speaking to BBC Radio 4, he also said that “so much of the money from the Inflation Reduction Act went to incumbent industries like carbon capture to enable to oil and gas industry to carry on doing what they do – and that puts bills up. The most important thing we’ve got to do is bring people’s bills down.”

The impact of a Trump presidency on the energy sector - and in particular on the Inflation Reduction Act - was also tackled by Simon Flowers, chief analyst at Wood Mackenzie.

Writing in a blog, he said that “the US will backtrack on net zero”.

He said that bipartisan support for measures in the Inflation Reduction Act “means that a full repeal is unlikely, but the expiration of tax cuts passed in President Trump’s first term will force Congress to re-examine incentives for low-carbon energy”.

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“Near-term growth expectations for wind, solar, battery storage and EVs rely on IRA incentives, including 10-plus years of eligibility for production and investment tax credits.”

He said that even if Congress doesn’t end those credits, “various elements of the IRA – including tax credit timelines, financing mechanisms or bonus adders – are likely to be removed or modified”.

“If those tax credits are phased out, tariffs put on equipment imports and restrictions on permitting, then we estimate renewable deployments could be reduced by a third. The Biden administration’s emissions standards for thermal power plants will be scrapped, although the rules are likely to be the subject of further legal battles.”