By Jim Roth, Director and Chair of the Firm’s Clean Energy Practice Group. This column was originally published in The Journal Record on November 21, 2016.
Jim Roth is a Director and Chair of the firm’s Clean Energy Practice.
Too early to know for sure
With the new president not yet taking office until Jan. 20, it is surely too early to know for sure what changes are in store for America’s energy and environment policies. But certain things are known with relative certainty: The philosophies of the outgoing and incoming administrations are certainly much different from one another. But what is unknown is how much will the effects of each be different and in what ways.
For eight years the Obama Administration has prioritized government action in the areas of energy and environmental policy. In fact, according to the White House’s website: “The President has taken unprecedented action to build the foundation for a clean energy economy, tackle the issue of climate change, and protect our environment.”
It is this action, especially the executive actions without congressional approval that has offended many republicans and has drawn the ire of the president-elect.
Since 2008, domestic energy related emissions have fallen to their lowest level in 20 years, due in large part to the massive boom in domestic natural gas production, which has helped to economically move dirtier coal out of the market in electricity and industrial output. Also, America has seen rapid growth in renewable energy development and Americans have more clean energy options today than any other time in history. Those technological progresses, coupled with many Clean Air Act policies and other regulatory pressures, have America headed toward a lower carbon future, where energy security is becoming a national security reality because of domestic production.
It seems obvious that the president-elect will make good on his campaign promise to “roll-back” regulations, but what is less obvious is: How far, which regulations and to what effect?
Obama’s Clean Power Plan, which Trump has vowed to kill, will be an early target along with several environmental and energy rules under litigation including the EPA’s controversial Waters of the US Rule, which has concerned many farm states, the Department of the Interior’s fracking rule and issues around public lands leasing for drilling. But again, at what practical impact is still anyone’s guess.
For example, even if Trump tries to re-open many coal mines in Appalachia, where the product is much dirtier than Wyoming’s Powder River Basin, where is the market for that product? Few utilities are still burning coal, many are under court-ordered retirement schedules and the enormous supply of cleaner-burning natural gas will continue to undercut the price of coal.
Also, and sometimes at the same pro-coal rallies, candidate Trump made promises about greater drilling for oil and natural gas that will only further over-supply the gas picture and make coal less competitive. So it’s a bit of a stretch to think that local utilities are going to ask their regulators for permission to raise the price of electricity so they can burn more coal and create more pollution. Market forces are at play here.
And political forces are at play in other ways that leave coal a diminished future, in spite of campaign promises from the president-elect. He would still have to convince the Republican Congress to join him in reversing America’s course toward a cleaner energy future.
Take wind for example. Republican Sen. Chuck Grassley, from Iowa, the original author of the wind energy production tax credit, warned candidate Trump in August “If he wants to do away with it, he’ll have to get a bill through Congress, and he’ll do it over my dead body.”
For environmentalists, there is certainly reason for worry as their priorities will be under attack from day one. Particular concern is justified when you consider that a climate-denier and skeptic named Myron Ebell is a possible nominee to be the head of the Environmental Protection Agency. But for those on the other side, their optimism may need to wait and see what actually happens legislatively and market-wise. Business can most assuredly expect relaxed regulations on energy consumption, industrial processes and their environmental footprint.
But the idea that all of America’s recent movements in energy and the environment are going to be reversed may prove to be more like the pre-election “big, beautiful wall to be paid for by Mexico” giving way to the post-election admission that it’s probably more likely a “fence in some places” if he can get Congress to pay for it with your money. Stay tuned.
Jim Roth, a former Oklahoma corporation commissioner, is an attorney with Phillips Murrah P.C. in Oklahoma City, where his practice focuses on clean, green energy for Oklahoma.