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Roth: Putting politics aside for renewable energy

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 27, 2017.


Jim Roth is a Director and Chair of the firm’s Clean Energy Practice.

Putting politics aside for renewable energy

Green cities continue to emerge from the coal dust.

Optimistically, some leaders are even proving they will rise above politics with their efforts. After all, clean energy should not (and is not) about politics, anyhow.

Lately renewables are being chosen over other forms of energy for reasons of “dollars and sense.” I recently happened upon a piece about a Texas city that will be the first to use 100 percent renewables in U.S. News, which led me to that publication’s list of the 10 states using the most renewable energy. The top 10 are a bit surprising and extremely promising, especially when you consider all the abundant clean energy here in Oklahoma.

In these 10 places, it’s not about whether they were likely to have supported Obama’s Clean Power Plan or Trump’s plan to eradicate it; these leaders have run the numbers and are implementing renewables accordingly, because it’s in their citizens’ economic interests.

That Texas city, the city of Georgetown, despite being extremely conservative, is one of the first cities in the country to use 100 percent renewables. The mayor there, Dale Ross, intends for his legacy to be that the environment in his city, and thus the planet, will be better because of Georgetown’s efforts.

Renewable energy just makes sense, say Mayor Ross and other city leaders, so politics didn’t (and shouldn’t) play a role in the decision. When the city was looking for a new energy provider, they discovered that after deregulation of retail energy, renewables were more cost-effective. Additionally, policies former Texas Gov. Rick Perry put in place allowed for the installation of large generation tie lines to bring wind across the state from the windy west side. As a result, Georgetown locked in their rates with wind and solar energy for 20 years.

I love the mayor’s quote regarding that decision, “Do you think that the wind is going to stop blowing in Texas, and the sun is going to stop shining in Texas, before or after we run out of fossil fuels?”

Oklahoma has a chance to put politics aside, too. When something is cheaper and cleaner, logic should conquer politics. Recently, my friend Johnson Bridgwater, who runs the Oklahoma Chapter of the Sierra Club, spoke about Oklahoma’s solar energy potential (it is enormous). He pointed to a map of the U.S. that indicated states with excellent “peak sun hours,” or those with the best potential for solar energy, and asked, “If this map revealed our oil and gas plays, would we sit on them?” No way. We’d materialize that energy. Which is what I hope our state will do. Our energy potential is before us, if we have the courage to remove politics and act in our citizens’ collective interests.

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.

Roth: A victory for fossil fuels over renewables

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 13, 2017.


Jim Roth is a Director and Chair of the firm’s Clean Energy Practice.

A victory for fossil fuels over renewables

At this juncture, it isn’t shocking to read the new tax proposal and learn that it harms renewable energy.

The headlines immediately bifurcated the energy sector into winners (fossil fuels) and losers (renewables). Retention of many long-standing fossil fuel breaks and incentives were an unsurprising boon for oil and gas companies, while the phase-out of many energy efficiency-related investment tax credits have the green energy industry angry and activated, and rightfully so.

It is counterintuitive that the tax proposal injures wind so badly, since it is proven, efficient, and reliable, and complements well with natural gas as the least expensive power source(s). While logic can’t be tied to the attack on wind, politics can. The tax proposal keeps in line with the current administration’s efforts to favor fossil fuels, especially coal, no matter how dirty or expensive. Plus, the revenue yanked from wind incentives goes to fund the newly created corporate tax revenue hole, which the Congressional Budget Office estimates this past week is the largest part of the $1.7 trillion estimated the GOP plan adds to America’s debt.

Subtitle F (the proposal’s heading dealing with energy credits) inadvertently got the letter grade it deserved as it outright fails renewable energy. Under the plan, the $7,500 tax incentive on electric vehicles is eliminated. States that mandated goals for zero-emission vehicles did so with an expectation of the incentive. Not to mention EV car companies whose business projections are based on the existence of the tax credit and a chance to keep American car manufacturers competitive with the world.

This section also contains certain repeals of oil and gas incentives, too, namely, the repeal of tax credits for marginal wells. This is especially negative for Oklahoma as the age and extent of our historic oil and gas production means we still have a significant number of marginal wells at work here in Oklahoma. Since many of these are owned and operated by mom-and-pop companies, it seems the GOP draft favors today’s large corporations over small businesses, at least as it relates to oil and gas marginal wells.

Another less obvious way the plan helps oil and gas corporations and harms renewable energy developers is the latter’s reliance on tax equity investors. Larger exploration and production-companies will benefit from the new corporate tax rate of 20 percent, down from 35 percent. But the model for many renewable energy projects relies upon, among other things, tax equity financing. When tax exposure is lower, it could follow that there would be less interest in tax equity financing projects, of all kinds, and especially energy.

Nevertheless, I remain steadfast in my confidence for our state’s and nation’s diverse energy future. Of course this optimism is buttressed by the reminder that there are still forthcoming amendments, and this plan will not likely become the final law. The bill, as proposed, violates the “Byrd rule,” a Senate reconciliation rule that, in part, allows senators to block legislation when it would considerably increase the federal deficit beyond a 10-year term.

So far, there are over a trillion reasons either of our two U.S. senators could block this draft and insist it be rewritten to help all forms of Oklahomans’ energies. 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.

Roth: World energy outlook

By Jim Roth, Director and Chair of the Firm’s Clean Energy Practice Group. This column was originally published in The Journal Record on September 18, 2017.


Jim Roth is a Director and Chair of the firm’s Clean Energy Practice.

World energy outlook

The U.S. Energy Information Administration publishes the International Energy Outlook Report, as well as heaps of other important energy data.

An agency of the U.S. Federal Statistical System, the EIA is responsible for collecting, analyzing, and disseminating independent and impartial energy information. Also a part of the U.S. Department of Energy, the EIA strives to promote sound policymaking, efficient markets, public understanding of energy and its interaction with the economy and the environment. And its prognostications are just, well, cool.

The EIA projects a 48 percent increase in world energy consumption by 2040, which is good for an energy state like ours. But the type(s) of energy is what should draw our attention.

Check out this chart to see the projects, where the greatest percentage growth seems to be in natural gas, renewables and liquid fuels (source):

The international report analyzed energy consumption for years 1990-2040. The EIA also publishes an annual Energy Outlook Report for the U.S. with the 2017 iteration projecting data through 2050. The report’s authors aptly warn that the data consist of projections, not predictions.

While the report considers many factors, a few among them technological progress, energy policies and world oil prices, it goes without saying uncertainty exists in every market. The energy industry is no stranger to market fluctuations due to adverse geopolitical events, the advent of new technology, changes at the impetus of the industry, and many other considerations. A current example to watch is the tariff petition solar manufacturers Suniva and SolarWorld brought before the International Trade Commission. ITC is expected to vote at the end of the month. Stay tuned for how that decision, and subsequent action by the president, will affect the solar industry in the U.S. and beyond.

Promisingly, the report revealed renewables are growing faster than any other energy source for the period analyzed, with nuclear tracking closely behind. The projected growth of renewables is attributed to a desire for energy security, the negative effects of emissions on the environment, and long-term high oil prices. Some of the aforementioned rationales support natural gas is the fastest-growing of the fossil fuels.

Despite a projected increase in renewables, world-consumption of fossil fuels will still sit at the three-quarter mark of all energy consumed through 2040. Coal is growing the slowest, but will still rise slightly, in part due to China’s vast consumption – it consumes half the world’s coal, add to that India’s consumption, and the number becomes 70 percent. Unlike much of Europe, the U.S., and others, Asia is not a member of the Organization for Economic Cooperation and Development, and, not surprisingly, China and India, are projected to make up more than half of the world’s total energy consumption.

Both countries are working on plans to reduce emissions, although since those country’s demand is tied to economic growth, the mitigation policies being considered will not make a huge difference. If the U.S. and other OECD members can remain focused on encouraging safe, clean, renewable, cost-effective energy sources, perhaps we can force the world consumption trajectory in a sound direction.

But then again, as those who toil in energy know, sometimes we can cause the ripple, but most often we are forced to ride the wave. Be aware of the projections and decide where your efforts lie in the probable path forward in America and the world.

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.