Great Year for Energy and Environment
Barry Worthington is the Executive Director of the United States Energy Association (USEA), the U.S Member Committee of the World Energy Council. USEA has one hundred fifty members across the U.S. energy sector, from the largest Fortune 500 companies to small energy consulting firms.
There’s a premium on predictions, but the exception could be energy priorities in 2018.
The Trump administration has revealed plenty in 2017 about what we can expect for our industry in 2018, and how it plans to shape energy policy.
The administration moved at record speed in 2017 to lay the groundwork for infrastructure expansion and job growth. It began rolling back redundant regulations and proffered a plan to optimize electricity markets.
And President Trump signed into a law the largest tax overhaul in thirty-one years, which opens oil and gas exploration in the Arctic National Wildlife Refuge. It also encourages the renewable energy sector to thrive.
We see that momentum continuing in 2018.
We expect public policy goals for the United States in 2018 will be infrastructure, infrastructure and more infrastructure in the same manner that jobs, jobs, and more jobs was the mantra in 2017.
Our energy industry has various ownership structures and business models. But a common denominator is that infrastructure investments are essentially financed using private, not taxpayer money.
Another common denominator is the major goal of our sector: to ensure energy production and delivery is increasingly safe, affordable, reliable, and clean.
The U.S. oil and natural gas industry deserves enormous credit for tapping a domestic resource base that is clearly abundant and affordable. New records for oil and gas production in the U.S. are expected in 2018.
And record exports of crude oil, refined products, and liquefied natural gas are predicted. Exports support U.S. jobs and help reduce the trade deficit. We will learn more this year about how U.S. energy resources fit into the global geopolitical puzzle.
Contributing to this export boom are refined products. In 2018, the United States will have the largest and most technologically advanced petrochemical complexes in the world. Additional regulatory relief in 2018 will allow our products to continue to be abundant and affordable.
Our domestic natural gas industry will be in the world spotlight when the World Gas Congress comes to town in June 2018. We will learn that all around the world, the pipeline industry shares our concern that those who protest new pipelines can constrain our energy supplies and delivery.
The electric power sector is certainly in the spotlight. On Thursday, January 18, as USEA kicks off its 2018 annual State of the Energy Industry Forum, the Federal Energy Regulatory Commission will hold its first meeting of the year, and with a full commission; FERC went without a full commission from October 2015 to its last meeting of 2017.
It should be an eventful year at FERC, if its decision on DOE’s Notice of Proposed Rulemaking to compensate coal and nuclear plants in electric markets is any indication.
Energy Secretary Rick Perry had sought financial support for coal and nuclear units to recognize the security and reliability attributes of their on-site fuel supply. Money reinvested in those plants would have meant infrastructure investments for all components of the U.S. power business.
But on January 8, FERC terminated the proceeding on the NOPR and instead asked operators in organized markets for more information, to determine whether any action on the matter of resilience was even needed.
2018 should be a boon for all areas of the energy sector and the environment.
The renewable industry will see 2018 as a year in which to benefit from last year’s tax package. Tax credits were unchanged in the final bill, but it was widely expected that they could be modified.
Less certain is the trade issue, with the potential for tariffs to be levied on solar panels, particularly from China. Fortune 500 energy companies are the largest investors in renewable energy, and this is unlikely to change in 2018.
And we see our industry continuing to reduce greenhouse gas emissions.
We are motivated by the entire variety of stakeholder pressures. We need neither the Clean Power Plan nor the Paris Accord.
Power sector emissions will be down more than twenty-five percent in 2018; the Paris Accord goal was to reduce emissions twenty-six to twenty-eight percent.
We are motivated by our shareholders. Every corporate shareholder resolution on climate change will get more favorable votes in 2018 than the same resolution would have received in 2017.
Our public and government officials at all levels want us to reduce emissions. Our customers want us to reduce emissions. All other stakeholders want us to reduce emissions, and our employees want us to reduce emissions.
We are retiring sixty-five-year-olds and replacing them with twenty-five-year-olds. The twenty-five-year-olds have a different perspective on climate change. They want to work for a company that is clean, green and cool. If we are not clean, green and cool, they will go to work for someone that is.
