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Commentary By William O'Keefe

Energy Policy: The Election Will Make a Difference

For the first time in recent memory, energy has not been a major election year issue.  Both parties have taken positions but there has been no substantive debate.  The Democrats want to extend the Obama Administration’s push for alternatives and suppress the use of fossil fuels to further its climate orthodoxy.  The Republicans are at the other end of the policy spectrum and want to remove barriers to greater use of oil, gas, and coal as well as roll back the regulatory juggernaut that has been the main mechanism for implementing climate and energy policy. 

Although each party’s objectives are clear, it is unlikely that either will be able to fully achieve them.  If the Democrats win the White House and take back the Senate, there will be attempts to build on the policies of the last eight years.  Since the Democrats are unlikely to capture the House, legislative initiatives will be stymied, at least until 2018.  The mid-term elections are just the opposite of this year’s in that democrats have many more Senate seats in play than do republicans.  Unless the Democratic majority in the Senate is much larger than projected, Republicans have a good chance of regaining control in 2018.  So, in that case, more gridlock is the likely path forward.

If Republicans win the White House and retain the Senate, the likelihood is that their majority will be less than today and not sufficient to prevent Democratic filibusters.  At best, there will be marginal gains coming from a lot of deal making.  If Democrats capture the Senate, they will not have much interest in working with a Republican president.  More gridlock is likely.

The most likely outcome for the next two years is that neither party will be able to accomplish much in terms of energy legislation.  The legislative climate is likely to remain the same as it has been for the past four years.

That means that regulatory agencies will continue to be the dominant force for implementing policy. With an almost evenly divided Senate, the confirmation process for the Secretaries of Energy, Interior, and EPA Administrator is likely to be drawn out and painful, independent of which party controls the Senate.  Of the three positions, the EPA Administrator is the most critical and there will probably be intense negotiations over confirmation of the Administrator, unless the same party controls both the White House and Senate.  And, even then parliamentary maneuvers could produce extended confirmation delays.

The EPA bureaucracy is made up primarily of people who see environmental protection as being more important than any other policy priority.  That means that a Democratic president could continue the regulatory path set by President Obama and Gina McCarthy even if compromise is needed to get an Administrator confirmed. 

A Republican president would not support new regulations aimed at fossil fuels. However, without oversight from political appointees, the EPA bureaucracy would still be able to pursue an activist agenda because of environmental litigation and existing compliance issues and deadlines. Trump has made it clear that he would try to roll back prior regulations, but this may be hard to achieve. 

The pace of energy and environmental regulation will be determined by who is in the White House, what constraints get imposed during the confirmation process, and whether Congress can use the budget process to influence the bureaucracy.

William O'Keefe is the President of Solutions Consulting. You can follow him on Twitter here.

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