On the left is the Bankside Power Station in 1953. That vast relic of the fossil era once towered over London, oily smoke pouring from its towering chimney. These days, Bankside looks like the right:

Bankside Power Station in 1953 via A London Inheritance; Bankside today via the Telegraph.

The old power plant’s vast turbine hall is now at the heart of the airy Tate Modern Art Museum; sculptures rest where the boilers once churned.

Bankside’s evolution into the Tate illustrates that transformations, both literal and figurative, are possible for our energy and economic systems. Some degree of demolition – if paired with a plan – can open up space for something innovative and durable.

Today, the entire energy sector is undergoing a massive transformation. After years of flat energy demand served by aging fossil power plants, solar energy and battery storage are increasingly dominating energy additions to meet rising load. Global investment in clean energy will be twice as big as investment in fossil fuels this year. But in the United States, the energy sector is also undergoing substantial regulatory demolition, courtesy of a wave of executive and Congressional attacks and sweeping potential cuts to tax credits for clean energy. 

What’s missing is a compelling plan for the future. The plan certainly shouldn’t be to cede leadership on modern energy technologies to China, as President Trump seems to be suggesting; that approach is geopolitically unwise and, frankly, economically idiotic. But neither should the plan be to just re-erect the systems that are being torn down. Those systems, in many ways, weren’t working. We need a new plan – a new paradigm – for the next era of climate and clean energy progress in the United States.

Asking Good Questions About Climate Policy Designs

How do we turn demolition into a superior remodel? First, we have to agree on what we’re trying to build. Let’s start with what should be three unobjectionable principles.

Principle 1. Climate change is a problem worth fixing – fast. Climate change is staggeringly expensive. Climate change also wrecks entire cities, takes lives, and generally makes people more miserable. Climate change, in short, is a problem we must fix. Ignoring and defunding climate science is not going to make it go away.

Principle 2. What we do should work. Tackling the climate crisis isn’t just about cleaning up smokestacks or sewer outflows; it’s about shifting a national economic system and physical infrastructure that has been rooted in fossil fuels for more than a century. Our responses must reflect this reality. To the extent possible, we will be much better served by developing fit-for-purpose solutions rather than just press-ganging old institutions, statutes, and technologies into climate service. 

Principle 3. What we do should last. The half-life of many climate strategies in the United States has been woefully short. The Clean Power Plan, much touted by President Obama, never went into force. The Trump administration has now turned off California’s clean vehicle programs multiple times. Much of this hyperpolarized back-and-forth is driven by a combination of far-right opposition to regulation as a matter of principle and the fossil fuel industry pushing mass de-regulation for self-enrichment – a frustrating reality, but one that can only be altered by new strategies that are potent enough to displace vocal political constituencies and entrenched legacy corporate interests.

With these principles in mind, the path forward becomes clearer. We can agree that ambitious climate policy is necessary; protecting Americans from climate threats and destabilization (Principle 1) directly aligns with the founding Constitutional objectives of ensuring domestic tranquility, providing for the common defense, and promoting general welfare. We can also agree that the problem in front of us is figuring out which tools we need, not how to retain the tools we had, regardless of their demonstrated efficacy (Principle 2). And we can recognize that achieving progress in the long run requires solutions that are both politically and economically durable (Principle 3).

Below, we consider how these principles might guide our responses to this summer’s crop of regulatory reversals and proposed shifts in federal investment.

Honing Regulatory Approaches

The Trump Administration recently announced that it plans to dismantle the “endangerment finding” – the legal predicate for the Environmental Protection Agency (EPA) to regulate greenhouse gas emissions from power plants and transportation; meanwhile, the Senate revoked permission for California to enforce key car and truck emission standards. It has also proposed to roll back key power plant toxic and greenhouse gas standards. We agree with those who think that these actions are scientifically baseless and likely illegal, and therefore support efforts to counter them. But we should also reckon honestly with how the regulatory tools we are defending have played out so far.

Federal and state pollution rules have indisputably been a giant public-health victory. EPA standards under the Clean Air Act led directly to dramatic reductions in harmful particulate matter and other air pollutants, saving hundreds of thousands of lives and avoiding millions of cases of asthma and other respiratory diseases. Federal regulations similarly caused mercury pollution from coal-fired power plants to drop by 90% in just over a decade. Pending federal rollbacks of mercury rules thus warrant vocal opposition. In the transportation sector, tailpipe emissions standards for traditional combustion vehicles have been impressively effective. These and other rules have indeed delivered some climate benefits by forcing the fossil fuel industry to face pollution clean-up costs and driving development of clean technologies.

But if our primary goal is motivating a broad energy transition (i.e., what needs to happen per Principle 1), then we should think beyond pollution rules as our only tools – and allocate resources beyond immediate defensive fights. Why? The first reason is that, as we have previously written, these rules are poorly equipped to drive that transition. Federal and state environmental agencies can do many things well, but running national economic strategy and industrial policy primarily through pollution statutes is hardly the obvious choice (Principle 2). 

Consider the power sector. The most promising path to decarbonize the grid is actually speeding up replacement of old coal and gas plants with renewables by easing unduly complex interconnection processes that would speed adding clean energy to address rising demand, and allow the old plants to retire and be replaced – not bolting pollution-control devices on ancient smokestacks. That’s an economic and grid policy puzzle, not a pollution regulatory challenge, at heart. Most new power plants are renewable- or battery-powered anyway. Some new gas plants might be built in response to growing demand, but the gas turbine pipeline is backed up, limiting the scope of new fossil power, and cheaper clean power is coming online much more quickly wherever grid regulators have their act together. Certainly regulations could help accelerate this shift, but the evidence suggests that they may be complementary, not primary, tools.

The upshot is that economics and subnational policies, not federal greenhouse gas regulation, have largely driven power plant decarbonization to date and therefore warrant our central focus. Indeed, states that have made adding renewable infrastructure easy, like Texas, have often been ahead of states, like California, where regulatory targets are stronger but infrastructure is harder to build. (It’s also worth noting that these same economics mean that the Trump Administration’s efforts to revert back to a wholly fossil fuel economy by repealing federal pollution standards will largely fail – again, wrong tool to substantially change energy trajectories.)

The second reason is that applying pollution rules to climate challenges has hardly been a lasting strategy (Principle 3). Despite nearly two decades of trying, no regulations for carbon emissions from existing power plants have ever been implemented. It turns out to be very hard, especially with the rise of conservative judiciaries, to write legal regulations for power plants under the Clean Air Act that both stand up in Court and actually yield substantial emissions reductions. 

In transportation, pioneering electric vehicle (EV) standards from California – helped along by top-down economic leverage applied by the Obama administration – did indeed begin a significant shift and start winning market share for new electric car and truck companies; under the Biden administration, California doubled down with a new set of standards intended to ultimately phase out all sales of gas-powered cars while the EPA issued tailpipe emissions standards that put the industry on course to achieve at least 50% EV sales by 2030. But California’s EV standards have now been rolled back by the Trump administration and a GOP-controlled Congress multiple times; the same is true for the EPA rules. Lest we think that the Republican party is the sole obstacle to a climate-focused regulatory regime that lasts in the auto sector, it is worth noting that Democratic states led the way on rollbacks. Maryland, Massachusetts, Oregon, and Vermont all paused, delayed, or otherwise fuzzed up their plans to deploy some of their EV rules before Congress acted against California. The upshot is that environmental standards, on their own, cannot politically sustain an economic transition at this scale without significant complementary policies.

Now, we certainly shouldn’t abandon pollution rules – they deliver massive health and environmental benefits, while forcing the market to more accurately account for the costs of polluting technologies, But environmental statutes built primarily to reduce smokestack and tailpipe emissions remain important but are simply not designed to be the primary driver of wholesale economic and industrial change. Unsurprisingly, efforts to make them do that anyway have not gone particularly well – so much so that, today, greenhouse gas pollution standards for most economic sectors either do not exist, or have run into implementation barriers. These observations should guide us to double down on the policies that improve the economics of clean energy and clean technology — from financial incentives to reforms that make it easier to build — while developing new regulatory frameworks that avoid the pitfalls of the existing Clean Air Act playbook. For example, we might learn from state regulations like clean electricity standards that have driven deployment and largely withstood political swings.

To mildly belabor the point – pollution standards form part of the scaffolding needed to make climate progress, but they don’t look like the load-bearing center of it.

Refocusing Industrial Policy

Our plan for the future demands fresh thinking on industrial policy as well as regulatory design. Years ago, Nobel laureate Dr. Elinor Ostrom pointed out that economic systems shift not as a result of centralized fiat, from the White House or elsewhere, but from a “polycentric” set of decisions rippling out from every level of government and firm. That proposition has been amply borne out in the clean energy space by waves of technology innovation, often anchored by state and local procurement, regional technology clusters, and pioneering financial institutions like green banks.

The Biden Administration responded to these emerging understandings with the  CHIPS and Science Act, Bipartisan Infrastructure Law (BIL), and Inflation Reduction Act (IRA) – a package of legislation intended to shore up U.S. leadership in clean technology through investments that cut across sectors and geographies. These bills included many provisions and programs with top-down designs, but the package as a whole but did engage with, and encourage, polycentric and deep change.

Here again, taking a serious look at how this package played out can help us understand what industrial policies are most likely to work (Principle 2) and to last (Principle 3) moving forward.

We might begin by asking which domestic clean-technology industries need long-term support and which do not in light of (i) the multi-layered and polycentric structure of our economy, and (ii) the state of play in individual economic sectors and firms at the subnational level. IRA revisions that appropriately phase down support for mature technologies in a given sector or region where deployment is sufficient to cut emissions at an adequate pace could be worth exploring in this light – but only if market-distorting supports for fossil-fuel incumbents are also removed. We appreciate thoughtful reform proposals that have been put forward by those on the left and right.

More directly: If the United States wants to phase down, say, clean power tax credits, such changes should properly be phased with removals of support for fossil power plants and interconnection barriers, shifting the entire energy market towards a fair competition to meet increasing load, as well as new durable regulatory structures that ensure a transition to a low-carbon economy at a sufficient pace. Subsidies and other incentives could appropriately be retained for technologies (e.g., advanced battery storage and nuclear) that are still in relatively early stages and/or for which there is a particularly compelling argument for strengthening U.S. leadership. One could similarly imagine a gradual shift away from EV tax credits – if other transportation system spending was also reallocated to properly balance support among highways, EV charging stations, transit, and other types of transportation infrastructure. In short, economic tools have tremendous power to drive climate progress, but must be paired with the systemic reforms needed to ensure that clean energy technologies have a fair pathway to achieving long-term economic durability.

Our analysis can also touch on geopolitical strategy. It is true that U.S. competitors are ahead in many clean technology fields; it is simultaneously true that the United States has a massive industrial and research base that can pivot ably with support. A pure on-shoring approach is likely to be unwise – and we have just seen courts enjoin the administration’s fiat tariff policy that sought that result. That’s a good opportunity to have a more thoughtful conversation (in which many are already engaging) on areas where tariffs, public subsidies, and other on-shoring planning can actually position our nation for long-term economic competition on clean technology. Opportunities that rise to the top include advanced manufacturing, such as for batteries, and critical industries, like the auto sector. There is also a surprising but potent national security imperative to center clean energy infrastructure in U.S. industrial policy, given the growing threat of foreign cyberattacks that are exploiting “seams” in fragile legacy energy systems.

Finally, our analysis suggests that states, which are primarily responsible for economic policy in their jurisdictions, have a role to play in this polycentric strategy that extends beyond simply replicating repealed federal regulations. States have a real opportunity in this moment to wed regulatory initiatives with creative whole-of-the-economy approaches that can actually deliver change and clean economic diversification, positioning them well to outlast this period of churn and prosper in a global clean energy transition.

A successful and “sticky” modern industrial policy must weave together all of the above considerations – it must be intentionally engineered to achieve economic and political durability through polycentric change, rather than relying solely or predominantly on large public subsidies. 

Conclusion

The Trump Administration has moved with alarming speed to demolish programs, regulations, and institutions that were intended to make our communities and planet more liveable. Such wholesale demolition is unwarranted, unwise, and should not proceed unchecked. At the same time, it is, as ever, crucial to plan for the future. There is broad agreement that achieving an effective, equitable, and ethical energy transition requires us to do something different. Yet there are few transpartisan efforts to boldly reimagine regulatory and economic paradigms. Of course, we are not naive: political gridlock, entrenched special interests, and institutional inertia are formidable obstacles to overcome. But there is still room, and need, to try – and effort bears better fruit when aimed at the right problems. We can begin by seriously debating which past approaches work, which need to be improved, which ultimately need imaginative recasting to succeed in our ever-more complex world. Answers may be unexpected. After all, who would have thought that the ultimate best future of the vast oil-fired power station south of the Thames with which we began this essay would, a few decades later, be a serene and silent hall full of light and reflection?

The Clean Air Act. The Clean Water Act. The National Environmental Policy Act. These and most of our nation’s other foundational environmental laws were passed decades ago – and they have started to show their age. The Clean Air Act, for instance, was written to cut air pollution, not to drive the whole-of-economy response that the climate crisis now warrants. The Energy Policy and Conservation Act of 1975 was designed to make cars more efficient in a pre-electric vehicle era, and now puts the Department of Transportation in the awkward position of setting fuel economy standards in an era when more and more cars don’t burn gas.

Trying to manage today’s problems with yesterday’s laws results in government by kludge. Legacy regulatory architecture has foundered under a patchwork of legislative amendments and administrative procedures designed to bridge the gap between past needs and present realities. Meanwhile, Congressional dysfunction has made purpose-built updates exceptionally difficult to land. The Inflation Reduction Act, for example, was mostly designed to move money rather than rethink foundational statutes or regulatory processes – because those rethinks couldn’t make it past the filibuster.

As the efficacy of environmental laws has waned, so has their durability. What was once a broadly shared goal – protecting Americans from environmental harm – is now a political football, with rules that whipsaw back and forth depending on who’s in charge. 

The second Trump Administration launched the biggest environmental deregulatory campaign in history against this backdrop. But that campaign, coupled with massive reductions in the federal civil service and a suite of landmark court decisions (including Loper Bright) about how federal agencies regulate, risks pushing U.S. regulatory architecture past the point of sensible and much-needed reform and into a state of complete disrepair.

Dismantling old systems has proven surprisingly easy. Building what comes next will be harder. And the work must begin now. 

It is time to articulate a long-term vision for a government that can actually deliver in an ever-more complex society. The Federation of American Scientists (FAS) is meeting this moment by launching an ambitious new project to reimagine the U.S. environmental regulatory state, drawing ideas from across ideological lines.

The Beginning of a New Era

Fear of the risks of systemic change often prevent people from entertaining change in earnest. Think of the years of U.S. squabbles over how or whether to reform permitting and environmental review, while other countries simply raced ahead to build clean energy projects and establish dominance in the new world economy. Systemic stagnation, however, comes with its own consequences. 

The Inflation Reduction Act (IRA) and the Infrastructure Investment and Jobs Act (IIJA) are a case in point when it comes to climate and the environment. Together, these two pieces of legislation represented the largest global investment in the promise of a healthier, more sustainable, and, yes, cheaper future. Unfortunately, as proponents of the “abundance” paradigm and others have observed, rollout was hampered by inefficient processes and outdated laws. Implementing the IRA and the IIJA via old systems, in short, was like trying to funnel an ocean through a garden hose – and as a result, most Americans experienced only a trickle of real-world impact.

Similar barriers are constraining state progress. For example, the way we govern and pay for electricity has not kept pace with a rapidly changing energy landscape – meaning that the United States risks ceding leadership on energy technologies critical to national security, economic competitiveness, and combating climate change.

But we are perhaps now entering a new era. The United States appears to be on the edge of real political realignments, with transpartisan stakes around the core role of government in economic development that do not match up neatly to current coalitions. This realignment presents a crucial opportunity to catalyze a new era of climate, environmental, and democratic progress.

FAS will leverage this opportunity by providing a forum for debate and engagement on different facets of climate and environmental governance, a platform to amplify insights, and the capacity to drive forward solutions. Examples of topics ripe for exploration include:

• Balancing agility and accountability. As observed, regulatory approaches of the past have struggled to address the interconnected, quickly evolving nature of climate and environmental challenges. At the same time, mechanisms for ensuring accountability have been disrupted by an evolving legal landscape and increasingly muscular executive. There is a need to imagine and test new systems designed to move quickly but responsibly on climate and environmental issues. 
• Complementing traditional regulation through novel strategies. There is growing interest in using novel financial, contractual, and other strategies as a complement to regulation for driving climate and environmental progress. There is considerable room to go deeper in this space, identifying both the power of these strategies and their limits. 
• Rethinking stakeholder engagement. The effectiveness of regulation depends on its ability to serve diverse stakeholder needs while advancing environmental goals. Public comment and other pipelines for engaging stakeholders and integrating external perspectives and expertise into regulations have been disrupted by technologies such as AI, while the relationship between regulated entities and their regulators has become increasingly adversarial. There is a need to examine synergies and tradeoffs between centering stakeholders and centering outcomes in regulatory processes, as well as examine how stakeholder engagement could be improved to better ensure regulations that are informed, feasible, durable, and distributively fair. 

In working through topics like these, FAS seeks to lay out a positive vision of regulatory reconstruction that is substantively superior to either haphazard destruction or incremental change. Our vision is nothing less than to usher in a new paradigm of climate and environmental governance: one that secures a livable world while reinforcing democratic stability, through systems that truly deliver for America. 

We will center our focus on the federal government given its important role in climate and environmental issues. However, states and localities do a lot of the work of a federated government day-to-day. We recognize that federal cures are unlikely to fully alleviate the symptoms that Americans are experiencing every day, from decaying infrastructure to housing shortages. We are committed to ensuring that solutions are appropriately matched to the root cause of state capacity problems and that federal climate and environmental regulatory regimes are designed to support successful cooperation with local governments and implementation partners. 

FAS is no stranger to ambitious endeavors like these. Since our founding in 1945, we have been committed to tackling the major science policy issues that reverberate through American life. This new FAS workstream will be embedded across our Climate and Environment, Clean Energy, and Government Capacity portfolios. We have already begun engaging and activating the diverse community of scholars, experts, and leaders laying the intellectual groundwork to develop compelling answers to urgent questions surrounding the climate regulatory state, against the backdrop of a broader state capacity movement. True to our nonpartisan commitment, we will build this work on a foundation of cross-ideological curiosity and play on the tension points in existing coalitions that strike us all as most productive.

We invite you to join us in conversation and collaboration. If you want to get involved, contact Zoë Brouns (zbrouns@fas.org).