Campaign promises are a mixed bag of ‘gimmes,’ ‘doables’ and ‘stretches,’ according to new client alert by veteran energy attorneys with the national law firm.
Will President-elect Donald Trump’s plan to unleash America’s $50 trillion in untapped shale, oil, and natural gas reserves, along with hundreds of years’ worth of clean coal, translate into a huge boon for the U.S. energy sector? Three veteran energy attorneys for LeClairRyan express skepticism about this claim in a new client alert published on the national law firm’s website.
“While the Obama administration’s anti-coal strategies burdened coal production and consumption, the coup de grâce was delivered by plentiful, low-priced gas,” the attorneys write. “The long planning horizon for the development of electric generation infrastructure makes generators cautious. Even a four-year guarantee of coal-friendly policies, with the possibility of a four-year extension, may not be enough incentive for multibillion-dollar investments in power stations that are built to operate for 40 years or more.”
The client alert, “Policy Predictions: How will Trump’s 100-Day Plan Affect U.S. Energy Industry?”, was authored by James P. Guy, II, a Shareholder in LeClairRyan’s Glen Allen, Va., and Washington, D.C., offices and head of its Energy Industry Team; Gwen E. Richard, a Shareholder in the firm’s Houston office; Senior Energy Advisor Roy M. Palk, a former utility company CEO based in LeClairRyan’s Glen Allen office; and John A. McKinsey, a Partner in the firm’s Sacramento office.
In the alert, the attorneys note that the American landscape is littered with failed prognostications about what new presidential administrations will be able to accomplish. “President-elect Trump’s 100-day action plan is a healthy mix of gimme, doable and stretch goals,” they write. Nonetheless, the attorneys venture a few predictions based on Trump’s stated positions, as well as their own experience representing energy companies during the administrations of the past five American presidents.
The alert includes commentary on Trump’s plans to create jobs, open onshore and offshore leasing on federal lands, encourage the use of natural gas and rescind job-destroying regulations. The team’s predictions include:
▪ Renewable energy subsidy and valuation will decline at the federal level.
▪ Coal will return to growth mode, especially in the western region of the U.S., where extraction costs are less and supply is more plentiful, with a chance of new coal power plant construction.
▪ Pipeline projects that increase the flexibility of the United States to profit from and/or rely on oil and gas will thrive. The Keystone Pipeline will likely be the first key beneficiary of this.
▪ Natural gas will thrive and may move toward being a significant exported fuel in the form of liquefied natural gas (LNG).
▪ Western states will be challenged to move toward higher levels of renewable energy use without federal support.
▪ Transmission line and other infrastructure investment may benefit significantly as it is one of the few points of agreement across the aisle in Washington.
The full client alert is available at:
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