New executive orders mandate sweeping changes to US energy policy

President Donald Trump recently issued three executive orders and a memorandum focused on the energy sector: Unleashing American Energy (EO 14154), Declaring a National Energy Emergency (EO 14159), Unleashing Alaska's Extraordinary Resource Potential (EO 14162), and Temporary Withdrawal of All Areas on the Outer Continental Shelf from Offshore Wind Leasing and Review of the Federal Government's Leasing and Permitting Practices for Wind Projects (memorandum) (the Offshore Wind Memo).

The orders and memo articulate broad policy objectives across a wide range of topics, and, as is typical in executive orders, delegate the details of policymaking to federal executive departments and agencies. Consequently, it remains to be seen how and when many of the goals stated will ultimately be implemented. Some of most salient aspects of the orders for project financing and development are summarized below:

EO 14154 declares that “it is U.S. policy” to:

• “encourage energy exploration and production on Federal lands and waters” (see below regarding offshore wind)
• “establish our position as the leading producer and processor of non-fuel minerals, including rare earth minerals,” and
• “eliminate the ‘electric vehicle (EV) mandate,’” including by terminating state emissions waivers and eliminating subsidies for EVs

EO 14154 also orders all federal agencies to “immediately pause the disbursement of funds appropriated” under the Inflation Reduction Act of 2022 (Public Law 117-169) (IRA), or the Infrastructure Investment and Jobs Act (popularly known as the Bipartisan Infrastructure Law, or BIL) (Public Law 117-58) and, within 90 days, “review their processes, policies, and programs for issuing grants, loans, contracts, or any other financial disbursements of such appropriated funds for consistency with the law” and the policy goals articulated in the order.”

Existing and prospective recipients of loan and grant funds under the IRA and BIL are seeking clarity on the future of these funding mechanisms pending the outcome of these reviews. The Office of Management Budget has issued a memorandum to the heads of agencies and departments (M-25-11) stating that the pause of IRA and BIL funding “only applies to funds supporting programs, projects, or activities that may be implicated by” the policy goals articulated in EO 14154 and noting that “[a]gency heads may disburse funds as they deem necessary after consulting with the Office of Management and Budget.”

EO 14154 also mandates a review of all existing agency actions that “impose an undue burden on the identification, development, or use of domestic energy resources — with particular attention to oil, natural gas, coal, hydropower, biofuels, critical mineral, and nuclear energy resources,” and specifically instructs the Secretary of Energy to “restart reviews of applications for approvals of liquified natural gas export projects.”

EO14159 orders all federal executive department and agency heads to “identify and exercise any lawful emergency authorities available to them, as well as all other lawful authorities they may possess, to facilitate the identification, leasing, siting, production, transportation, refining, and generation of domestic energy resources, including, but not limited to, on Federal lands,” including via federal eminent domain powers and the Defense Production Act.

EO 14162 declares that “it is U.S. policy" to:

• “efficiently and effectively maximize the development and production of the natural resources located on both Federal and State lands within Alaska”
• “expedite the permitting and leasing of energy and natural resource projects in Alaska,” and
• “prioritize the development of Alaska’s liquified natural gas (LNG) potential”

The order also instructs all federal executive department and agency heads to “exercise all lawful authority and discretion available to them and take all necessary steps to rescind, revoke, revise, amend, defer, or grant exemptions from any and all regulations, orders, guidance documents, policies, and any other similar agency actions that are inconsistent with” the foregoing policy. Additionally, the order specifically directs the Secretary of the Interior to rescind the cancellation of any leases within the Arctic National Wildlife Refuge, other than as consistent with the stated policy.

The Offshore Wind Memo withdraws all areas within the outer Continental Shelf[1] from wind energy leasing until further notice. The memo explicitly exempts leasing related to “any other purposes such as, but not limited to, oil, gas, minerals, and environmental conservation,” and rights under existing leases; however, the memo also orders the Secretary of the Interior to “conduct a comprehensive review of the ecological, economic, and environmental necessity of terminating or amending any existing wind energy leases” and prohibits federal agencies from issuing “new or renewed approvals, rights of way, permits, leases, or loans for onshore or offshore wind projects pending the completion of a comprehensive assessment and review of Federal wind leasing and permitting practices.”

For more information, please contact the authors.

[1] The memo refers to the “Offshore Continental Shelf”; the statutory defined term is “outer Continental shelf.” (see 43 U.S.C. § 1331)