By Umair Irfan
March 3, 2017 - Coal may see some resurgence under President Trump, but some state officials are preparing for when he leaves office.
Wyoming Gov. Matt Mead (R) told energy leaders last week that the beleaguered coal sector, which has suffered several high-profile bankruptcies, will likely rebound as the Trump administration rolls back some Obama-era energy and environmental policies. But he and other analysts said competition from renewables and global action on climate change will continue to mount, so some states are still bracing for a carbon-constrained energy market.
“In my world, we think the next four years are going to be a great world for coal and oil and gas, but what about the next four years and the years after that?” Mead said at the Southern States Energy Board summit in Washington, D.C.
He noted that while demand for fossil fuels will likely remain high, regulations on greenhouse gas emissions could come back in the United States and are ramping up around the world. That could put drillers and miners back in a bind if they aren’t ready with answers.
“We will not always have a Republican president,” Mead said. “This is the time to double down on innovation and science and try to find solutions.”
For the nation’s largest coal-producing state, where fossil fuels are the largest industry, officials also have to balance energy policies with immediate environmental concerns for tourism and agriculture, which are respectively the second- and third-largest industries in Wyoming.
And while American lawmakers may debate the role of human activity in the global climate, other countries and institutions have already moved on, and the fossil fuel sector is dealing with the consequences.
“Regardless of people’s personal beliefs about coal, the climate and the world is — that climate change is caused by man — we have banks that are refusing to lend to coal companies anymore,” Mead said.
To prepare, Mead said, his strategy is to invest in innovation and pilot projects using new technologies that cut greenhouse gas emissions, ensuring coal will still be on the menu in the world’s energy mix.
“We think carbon capture and the utilization of CO2 will be key for coal’s future,” Mead said.
DOE to ‘Shift’ Back to Fossil Fuels
The question now is where the Trump administration will place its bets.
Mead said that Wyoming is getting ready to put up the nation’s largest wind farm but said that research priorities at the U.S. Department of Energy should be rebalanced to reflect where most of the energy currently comes from, especially if climate change is a priority.
“Over the last eight years, there’s been a lack of parity between renewables and traditional fossil fuels,” he said. “I think that’s been a fundamental mistake of many in the Obama administration.”
Karen Harbert, president and CEO of the U.S. Chamber of Commerce’s Institute for 21st Century Energy, an industry policy group, said she expects that former Texas Gov. Rick Perry (R), who was nominated to lead DOE, will implement some of these changes.
“The role of the Department of Energy will shift,” she said. “Some of the basic research probably will stay the same.”
Harbert noted that the private energy sector is already a major energy investor, including in research and development but argued that DOE should back out of trying to deploy energy, since that is an area where the industry does a better job.
“We also can’t forget that the energy industry itself invests more in R&D than the Department of Energy does, which is why it’s very important for those of us in the energy space to get the R&D tax credit made permanent,” she said.
As for Trump’s promise to bring back jobs in the coal sector, Harbert said he may only see limited success.
“Can he [Trump] help coal country? Absolutely, by repealing the Clean Power Plan,” she said. “Is that going to put everybody back to work in Appalachia and other places? No.”
Another concern is how Perry can achieve his agenda when he’s no longer serving as a state executive but as a peer to other federal agencies.
“It’s going to take a lot of interdepartmental communication and coordination to have a coherent energy strategy,” said Michael Nasi, who serves as general counsel to the Clean Carbon Technology Foundation of Texas and worked under Perry in Texas.
And while Perry prided himself as a fiscal conservative during his confirmation hearing, he supported technology deployment initiatives while he was governor. Republicans have criticized DOE’s past deployment efforts like the loan guarantee program, though some have warmed to projects the agency has launched in fossil fuels (Climatewire, Feb. 16).
Carefully drawing boundaries around the role of DOE in driving energy research and deployment in a way that comports with his vision, the department’s mandate and the ideological agenda of his party will likely emerge as one of his biggest challenges.
“It’s a very fine line from where does government research end and where does the market begin,” Nasi said.
Reprinted from ClimateWire with permission from E&E News. Copyright 2017.