To take a short break from the very scary racism, sexism, and xenophobia coming out of the Trump campaign, and the GOP in general, let’s talk about Climate and Secretary Clinton. The climate movement is hankering to start pushing a President Clinton on climate. Here are some thoughts to add to the momentum leading up to Clinton’s first few days in office (if all goes well). I’ve been wondering if Clinton’s starter policies will, and at what magnitude, add to the plight of the fossil fuel industries, making this yet another good time to divest from coal, oil and gas.

Clinton does have a publicly posted climate plan. In true Clinton pragmatism, the plan is a very detailed, very comprehensive series of wonky policies and market incentives. And as you all know, as frustrating as it is, the plan is well within the bounds of what’s politically possible — meaning it falls far short of what’s needed. Tragically inadequate, the plan does add some juice to the many nuanced fights to expand renewable energy access and keep fossil fuels in the ground. And that translates to bad news for fossil fuel companies.

It’s impossible to really know how Clinton’s plans will affect fossil fuel production, or even if they will be implemented in their entirety or if the movement will push them further. With that being said, here’s a bit of speculation on how fossil fuels might struggle under Clinton’s proposals.

Taken from the Clinton climate plan web page (linked above): “Clinton will reform onshore coal, oil, and gas leases to ensure taxpayers are getting a fair deal by raising federal royalty rates and closing loopholes.” This is not insignificant. Oil and gas companies are currently battling the tension of low oil prices and high production costs. Their profit margins are squeezed. Increasing the expense of land leases, and thus total production costs, will compound the profit stress for the extractive industries. If these projects don’t make scientific sense, it’s a good thing if they don’t make economic sense as well.

Methane regulations would be a similar turn on the profit squeezing bench vice. Clinton has a specific section in her plan on methane regulation. This could be a major factor in her response to fracking standards.

The other thing that stands out as a big threat to big oil is Clinton’s proposed extensions to federal emission standards. Exxon derives up to 40 percent of its revenue from vehicle fuels and roughly 75 percent of crude oil globally is used for vehicle transport. Pushing vehicle and heavy-duty vehicle emission standards increases the momentum of EVs onto the market. The transition to electric vehicles in the US is the guillotine for big oil. At current growth rates, Bloomberg analysts predict a decline in demand at 2 million barrels a day by as early as 2023. Anything that adds motivation for car companies to produce low/no emission vehicles is bad for the oil industry bottom line.

The fourth element in Clinton’s climate proposal that jumped out to me was around jobs. Clinton has tied her climate plan with messaging around creating millions of good-paying jobs. It was reported early this year that more Americans are now installing solar panels on rooftops than mining coal or extracting oil and gas.

It’s true, the coal industry is hurting these days — a major theme of the election. The industry downturn has much more to do with the expansion of cheaper shale gas than anything else. Low-cost renewable energy, energy efficiency improvements, public health policies, and social movement opposition are other factors pushing coal into structural decline. And, as individual coal companies are squeezed into bankruptcy (it’s not just coal, 58 North American oilfield service companies since 2015), it’s the blue collar workers who are burdened, not company executives.  Clinton does have an element of her plan to infuse significant capital back into coal communities, but there is no doubt that a transition from the coal, oil and gas industries will be difficult for some.

Within clean energy, labor unions are growing stronger (as Clinton plans to support), which means we may see a stronger political force shifting government permitting and contracting into renewable energy and away from dirty energy. If the labor markets become more competitive for coal, oil and gas, meaning labor is more expensive, the cost of production goes up and profit margins are squeezed.. again.

So, it’s true the Clinton climate plan could cramp the fossil fuel industries, but it’s not the Keep It In The Ground policy platform we are all calling for. That’s up to us to push these policies to meet the call of climate justice. As we set out to organize and mobilize, the fossil fuel industry’s next four years look grim. This should be a big red flag for investors — #divest

Brett Fleishman is’s Senior Global Analyst.

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