Speaker 1: You are listening to Bloomberg Switched on the b n
Speaker 1: F podcast. I'm Dana Perkins, and today we're going to
Speaker 1: talk about the United States. The whole world seems to
Speaker 1: be looking at the upcoming US election, and with November
Speaker 1: three right around the corner, there is plenty to speculate about.
Speaker 1: So today we're going to hear from Ethan Zindler, he's
Speaker 1: head of America's here at b NF, and Stephen Monroe,
Speaker 1: who is a policy analyst. Here. We discussed some of
Speaker 1: the significant things that have happened over the past four
Speaker 1: years and what's hanging in the balance for the next
Speaker 1: what's the status of the Paris Climate Accord, the Clean
Speaker 1: Power Plan or the Green New Deal. What's happening with coal,
Speaker 1: natural gas, renewables and electric vehicles, and how about that
Speaker 1: two trillion in climate spending that was promised as a
Speaker 1: part of Biden's platform. Where do executive orders and the
Speaker 1: filibuster rule play into this. Well, we've got a lot
Speaker 1: to cover today, but it's also worth pointing out that
Speaker 1: one of the things that we did not cover was
Speaker 1: the Supreme Court and what the replacement for the late
Speaker 1: Great Ruth Bader Ginsburg will mean as we had recorded
Speaker 1: this just prior to her passing. A quick reminder, b
Speaker 1: ANF does not provide investment or strategy advice. We have
Speaker 1: a full disclaimer at the end of the show. Now,
Speaker 1: let's talk about the United States. Ethan Stephen, thank you
Speaker 1: for joining us today on switched On. Glad to be here,
Speaker 1: Great to be here. Today. We're going to talk about
Speaker 1: the upcoming US elections, and we're going to get into
Speaker 1: some of the stuff that be ENF specifically knows around
Speaker 1: power and transport and natural gas, and then some policies.
Speaker 1: But let's let's first start and talk about the scenarios
Speaker 1: that could potentially exist. So looking forward to November, what
Speaker 1: are the potential outcomes of the election? Well, I guess
Speaker 1: I'll kick it off, and you know, obviously the thing
Speaker 1: that gets the most headlines here and internationally is the
Speaker 1: presidential race. And so stating the obvious, we will in
Speaker 1: theory have a winner the day after the election. It
Speaker 1: might frankly take longer, but uh hopefully we will have
Speaker 1: an undisputed winner of that election, will either be President
Speaker 1: Trump winning re election for four more years or former
Speaker 1: Vice President Joe Biden taking the office. So that's the
Speaker 1: first thing. And then, of course there are a lot
Speaker 1: of important races taking place so called down the ballot
Speaker 1: in terms of the Congress, and in those cases, the
Speaker 1: real key area that we're watching, and many others are
Speaker 1: is the US Senate. The Democrats can control the House
Speaker 1: of Representatives at the moment, that does not look like
Speaker 1: it's under much threat at the moment. The Republicans, however,
Speaker 1: control the Senate, and only by a small margin. And
Speaker 1: so one of the things that we'll be watching very
Speaker 1: carefully is to see if Democrats win the relatively small
Speaker 1: number of seats they need to take control of the Senate.
Speaker 1: They could take control by picking up as little as
Speaker 1: three additional seats if Biden wins the White House. So
Speaker 1: let's dig in to what this election means for some
Speaker 1: of the things that we specifically covered. Be enough, So
Speaker 1: let's first start, I think and talk about power sector emissions.
Speaker 1: So there are where I'm recording from, So in London
Speaker 1: we talk a lot about net zero. What is kind
Speaker 1: of the future of emissions in the United States, and
Speaker 1: kind of what's the dialogue like going on over there? Well,
Speaker 1: I'll start um and Steph please fill in any holes here.
Speaker 1: Uh you long story short is the arrival of President Trump,
Speaker 1: talking about CEO two emissions at the federal level has
Speaker 1: largely gone out of style. And that is you know,
Speaker 1: one of the first actions that the President took was
Speaker 1: to set in motion or to start turning the wheels
Speaker 1: towards getting the US out of the planet Paris Climate accord. Uh.
Speaker 1: And while that process isn't is actually not officially done yet.
Speaker 1: For all intents and purposes, there have not been any
Speaker 1: real efforts from the federal government to try to meet
Speaker 1: the Paris targets. Interestingly, and somewhat ironically, the US has
Speaker 1: been using our CEO two emissions even quite quickly during
Speaker 1: the last three years, and that is really largely due
Speaker 1: to the major dynamics that we were seeing in the
Speaker 1: power sector before the arrival of Trump and so so,
Speaker 1: actually our emissions are down substantially from power, although they've
Speaker 1: been rising a bit from the transportation sector. But the
Speaker 1: bottom line is that the US really is not in
Speaker 1: any great position now to meet the obligations of the
Speaker 1: Paris Agreement. You know, based on what we've seen over
Speaker 1: the last couple of years, I'm guessing some of these
Speaker 1: power sector emissions reducing has a lot to do with coal,
Speaker 1: So can you elaborate on that a bit, because I
Speaker 1: think that's been one of the topics that's come up
Speaker 1: over and over again during this current president's tenure in office.
Speaker 1: Is kind of a move to try and see if
Speaker 1: they could rescue the coal industry. But what has that
Speaker 1: actually been like and what does the future of the
Speaker 1: coal industry look like? Agnostic of whose president, Well, I
Speaker 1: think what can be said of interestry is that the
Speaker 1: US and Europe have basically been tracking each other in
Speaker 1: terms of the elimination or removal of coal from the
Speaker 1: power mix, but they've been doing so with entirely different objectives.
Speaker 1: And what I mean by that is that in Europe,
Speaker 1: the withdrawal of coal from the market has been largely
Speaker 1: policy driven and has broad public support. In the US,
Speaker 1: the removal of coal from the power mix has actually
Speaker 1: gone against the policy intentions of the Trump administration, which
Speaker 1: has taken every step that it could can take without
Speaker 1: seeking legislative approval to retain coal in the power mix.
Speaker 1: And specifically, what I'm referring to is that in early
Speaker 1: in his term, President Trump canceled the Clean Power Plan,
Speaker 1: which was a signature power initiative of the Obama administration
Speaker 1: that would have effectively eliminated coal over a period of time.
Speaker 1: But despite eliminating the Clean Power Plan and replacing it
Speaker 1: with a much more lenient regulatory package, as far as
Speaker 1: coal is concerned, the US has continued to see withdrawals
Speaker 1: and retirements of coal plants. So, in summary, what we
Speaker 1: have in Europe, which is largely policy driven and to
Speaker 1: a lesser extent economically driven in the US is the
Speaker 1: result of almost exclusively economically determined factors. Yeah, I would
Speaker 1: totally agree with that. And just to put one specific
Speaker 1: around it, I mean, when Trump came into office, coal
Speaker 1: accounted for about of all US power. You know, it's
Speaker 1: now down to about in twenty nineteen and very well
Speaker 1: could be lower this year as well. You know, you
Speaker 1: look at the run numbers. There hasn't been a lot
Speaker 1: to move the needle. That hasn't been lacked for lack
Speaker 1: of trying on the part of the Trump administration. But
Speaker 1: Steph mentions, uh, and I would I would agree. I
Speaker 1: think there's only so much that an administration can get
Speaker 1: done unilaterally. You do need to really move the needle.
Speaker 1: For coal, you would need some kind of legislation through Congress,
Speaker 1: and the Democrats control the House, and even when Republicans
Speaker 1: controlled the House, there was no major action towards that.
Speaker 1: So we've gone from thirty down to the mix. What
Speaker 1: is made up that seven percent gap? And what does
Speaker 1: the power mix look like now? Well, just maybe to
Speaker 1: round it out, I mean, we went from gas being
Speaker 1: about thirty four percent of generation to about thirty eight percent,
Speaker 1: and renewables have jumped as well, despite again clear aversion
Speaker 1: to them from the President, still under you know, you know,
Speaker 1: about ten percent in that neighborhood for non hydro renewables
Speaker 1: at the moment, but it has been growing on a
Speaker 1: generation basis, so it's really been a combination of gas
Speaker 1: and renewables. Nuclear has been slowly declining as we've seen,
Speaker 1: you know, each year several nuclear reactors announced their retirement
Speaker 1: and come offline. But we still have about a hundred
Speaker 1: giga wats of nuclear, which is about of the total
Speaker 1: power and is about of this zero carbon power that
Speaker 1: the United States has online. It needs to be pointed
Speaker 1: out that the decarbonization of the US power sector still
Speaker 1: remains a bit of a distant objective, even though coal
Speaker 1: is retreating rapidly from the market. As Ethan points out,
Speaker 1: gas is taking a large share of the market being
Speaker 1: abandoned by coal and gas while it certainly is burned
Speaker 1: with much less carbon emissions than coal, nevertheless is an
Speaker 1: emitting resource, and it is one that the Trump administration
Speaker 1: has gone to great lengths to support. On a separate track,
Speaker 1: then it's relatively unsuccessful supporting measures for coal. Well, soon,
Speaker 1: let's talk about some of the potential outcomes, because one
Speaker 1: of the things that came up, I think, on the
Speaker 1: campaign trail was that Biden's got this two trillion dollar
Speaker 1: potential green focus, energy and climate plan. What does it
Speaker 1: look like in the future for renewables and I guess
Speaker 1: the power sector altogether depending upon these two outcomes, Are
Speaker 1: these going to be massively virgent or is it still
Speaker 1: sort of separate from whether or not who is president
Speaker 1: and what matters much more who's in the Senate. Well,
Speaker 1: if we want to look at Biden's platform, and I
Speaker 1: certainly think it's appropriate to do so, you are correct.
Speaker 1: He has committed to make a two trillion dollar accelerated
Speaker 1: investment during his first term that all of which would
Speaker 1: be directed broadly towards meeting ambitious climate goals that, according
Speaker 1: to Biden, is demanded by the science. Spreading that to
Speaker 1: trillion out much of it would go to infrastructure and
Speaker 1: specifically the power sector. He also would like to devote
Speaker 1: segment of it to R and D technologies, or R
Speaker 1: and D into technologies that such as battery storage, and
Speaker 1: he would negotiate He wants to negotiate fuel standards. He
Speaker 1: wants to renegotiate fuel economy standards that have been deluded
Speaker 1: in the Trump administration, and in doing so that would
Speaker 1: have the effect of raising demand rather rapidly for electric vehicles, which,
Speaker 1: as I mentioned, would be a significant receipt recipient of
Speaker 1: some of this financial largest So, if I could just
Speaker 1: add a little on the politics on it, two trillion
Speaker 1: dollars may sound like a lot of money, and that
Speaker 1: is because it's a lot of money, a lot of money,
Speaker 1: and um, we're these normal political times. I think I
Speaker 1: would probably say there's just no way that we'll ever
Speaker 1: see that kind of money allocated in this area just
Speaker 1: because of fiscal conservatism. However, you know, these are very
Speaker 1: unusual times, and we have already seen well over a
Speaker 1: trillion dollars in stimulus that's been passed by Congress, and
Speaker 1: several trillion more that's been passed by the U. S.
Speaker 1: House of Representatives but not by the Senate. So there
Speaker 1: does seem to be a recognition that these are extremely
Speaker 1: unusual and challenging times in the U. S. Economy. I
Speaker 1: don't know where where will end the year in terms
Speaker 1: of GDP, but it will be a very sharp contraction.
Speaker 1: So you know, that does make a lot more possible.
Speaker 1: But there's definitely going to have to be quite a
Speaker 1: result in the our into election. I think for us
Speaker 1: to see a number like two trillion even anywhere near consideration,
Speaker 1: and namely, Biden will have to win the election. Democrats
Speaker 1: will have to win the Senate, and then one other
Speaker 1: fairly technical but important thing will have to happen, most likely,
Speaker 1: which is that the Democrats will have to agree to
Speaker 1: essentially abolish something known as the filibuster rule in the Senate.
Speaker 1: In other words, they will have to change the rules
Speaker 1: so that all you need is fifty plus one vote
Speaker 1: to make something happen in the Senate. Right now, without
Speaker 1: getting into too many technical details, basically, it's very hard
Speaker 1: to do a lot of things in the Senate without
Speaker 1: having sixty votes, but if you drop that to fifty one,
Speaker 1: a lot more becomes possible. Yes, and I agree with
Speaker 1: Ethan's observation that two trillion dollars is a lot of money,
Speaker 1: and it certainly is the eye catching part of Biden's platform.
Speaker 1: I would suggest, however, that perhaps one of the more significant,
Speaker 1: perhaps the most significant part of the platform, is his
Speaker 1: call to completely decarbonize the power sector, or I should say,
Speaker 1: make the carbon sector carbon pollution free by which is
Speaker 1: less than fifteen years away. That's a tremendously ambitious undertaking
Speaker 1: if Biden were to be elected president, and even if
Speaker 1: he were to secure a democratic majority in both the
Speaker 1: House and the Senate, in other words, even if he
Speaker 1: had a full wind at his back. Nevertheless, remains a
Speaker 1: very ambitious undertaking man. There really isn't any precedent in
Speaker 1: an energy transition of that speed anywhere in history. Well, so,
Speaker 1: staying on that theme of that money, what we discussed
Speaker 1: just earlier is regarding the coal industry and what will
Speaker 1: likely be its phase out for economic reasons. But when
Speaker 1: we're talking about the coal industry and why there's been
Speaker 1: so much emphasis on it in recent past, it really
Speaker 1: comes down to jobs, and it comes down to people's livelihoods.
Speaker 1: And within that two trillion dollars, is that considered to
Speaker 1: be a particular stimulus package. Is it considered to be
Speaker 1: a massive job creator or is it more focused on
Speaker 1: climate and CEO two emissions. Well, jobs has been the
Speaker 1: basis for Trump's state of support for coal, but the
Speaker 1: reality is that jobs in the coal sector began falling
Speaker 1: long before President Trump took office, and they today account
Speaker 1: for a very small sector of the economy. Interestingly, Joe
Speaker 1: Biden's platform is also very jobs oriented, and so to
Speaker 1: a certain extent, you have both the president and the
Speaker 1: challenger basing their policies, their climate and energy policies on
Speaker 1: job creation. But the Trump basis of jobs creation certainly
Speaker 1: would have to be expanded beyond coal to have much
Speaker 1: validity because of the fact that the coal industry is
Speaker 1: a declining sector in the economy. I think an answer
Speaker 1: to your question, and you know, is this about jobs?
Speaker 1: Is this about climate? The answer is us to everything.
Speaker 1: I think that that's the intention here. Um. I do
Speaker 1: think one thing that's intriguing in the Biden plan that
Speaker 1: I do hope well, I think frankly, ultimately we'll have
Speaker 1: to get addressed is that, you know, Biden's conception of
Speaker 1: a job is a unionized job with union worker protections
Speaker 1: and wages, And if we're honest that is that is
Speaker 1: not the case for many jobs in the clean energy
Speaker 1: sector today. And so how you square that circle? I
Speaker 1: think it's going to be one of the more interesting
Speaker 1: challenges for a Biden administration if there is one yes,
Speaker 1: absolutely true, I would point out that jobs is by
Speaker 1: far the most frequently used word in the Biden campaign,
Speaker 1: but the second most frequently used words union. Jobs gets
Speaker 1: fifty three mentions in the In the Biden platform, union
Speaker 1: gets thirty two mentions, and both of those words get
Speaker 1: more mentions than clean energy, carbon or power. Okay, so
Speaker 1: let's go into emissions, which isn't mentioned as often in
Speaker 1: his platform, and let's talk about transportation related emissions, which
Speaker 1: are the largest source of emissions in the United States
Speaker 1: right now. So what does the future hold in the
Speaker 1: transportation space? In the Trump era? We've seen a division
Speaker 1: grow between the US and Europe certainly, and between the
Speaker 1: between the US and China in the level of electric
Speaker 1: vehicle penetration, and the US is going to continue to
Speaker 1: lose ground to those two regions on the adoption should
Speaker 1: Trump be reelected, because none of his policy initiatives are
Speaker 1: intentionally aimed at promoting that particular sector. We have been
Speaker 1: expect that China and Europe together are going to account
Speaker 1: for a combined of global EV sales. So you can
Speaker 1: see that the US as a minischool part of the
Speaker 1: remain Even if the US were to have the majority
Speaker 1: of the remainder, we still will be talking about a
Speaker 1: less share. So really this is the current trajectory and
Speaker 1: likely to stay to stay on pace. So the economics
Speaker 1: aren't there yet for there to be wide range EV adoption.
Speaker 1: How about charging stations? Are those rolling out charging stations
Speaker 1: as a recipient of policy support have received zero support
Speaker 1: in the Trump years and Biden would pivot to a
Speaker 1: great deal support both by leveraging federal R and D
Speaker 1: but also by leveraging federal procurement of electric vehicles and
Speaker 1: funding the deployment of charging stations to support them. So
Speaker 1: there's a pretty clear difference between the two candidates in
Speaker 1: their view of the e V of the e V
Speaker 1: role in the marketplace. The interesting wild card, as I
Speaker 1: see it, is that US is on the verge of
Speaker 1: introducing to the market electrically powered light trucks, which that's
Speaker 1: a big part of our of our fleet vehicle fleet
Speaker 1: over here in the US, and it remains a very
Speaker 1: popular part of the market. So to the extent that
Speaker 1: the US introduces electrically powered like pick up trucks and SUVs,
Speaker 1: there does exist an opportunity for the US to do
Speaker 1: a relatively rapid catch up or at least trying to
Speaker 1: close the gap between the EV share of the fleets
Speaker 1: here and in the rest of the world. If I
Speaker 1: could add a small note of optimism if I can
Speaker 1: about US and and evs, which is that you know,
Speaker 1: we we are home to Tesla obviously UM, and we're
Speaker 1: home to a number of other startups that are now
Speaker 1: raising gobs of money to be electric carmakers and and
Speaker 1: and certainly the Chinese as a staff notes, you know,
Speaker 1: there's more more evs on the road over there, and
Speaker 1: there's more manufacturing what over there. But we we do
Speaker 1: have the one and only truly global brand for electric
Speaker 1: vehicles in Tesla, and it is UM and is proving
Speaker 1: popular really where almost any part of the world where
Speaker 1: you can get your hands on one. So you know,
Speaker 1: I do think there's an opportunity for the US to
Speaker 1: to be a leader on the manufacturing of electric vehicles.
Speaker 1: It won't be easy by any means, and it would
Speaker 1: definitely help if would have policies in place that could
Speaker 1: make this a reliable demand market here domestically. But I
Speaker 1: do think there is that that potential opportunity because as
Speaker 1: you guys both know, you know, buying a car, yes,
Speaker 1: you do think about whether it's got a good does
Speaker 1: it make sense economically, but there is a completely non
Speaker 1: rational part of the sales process as well. They can
Speaker 1: drive that. You can drive people to want to buy things,
Speaker 1: um just as they're cool or because they're really fun
Speaker 1: to drive. And it remains key in the US in
Speaker 1: terms of the adoption of evs that fuel economy standards
Speaker 1: for internal combustion vehicles be strict and to be additive
Speaker 1: over the course of years, and the Trump administration UM
Speaker 1: has taken steps to in effect freeze the progress of
Speaker 1: rising fuel economy standards in the States, and it also
Speaker 1: has moved to take away the ability of California to
Speaker 1: set its own requirements. So regardless of individual sectors of
Speaker 1: the eating marketplace, what is at present lacking and would
Speaker 1: continue to be absent in in the event of a
Speaker 1: Trump reelection. Are fuel economy standards that that push the market,
Speaker 1: if you will, towards the acceptance of more fuel efficient
Speaker 1: vehicles and zero emission vehicles such as these. So it
Speaker 1: seems like there's a pretty stark difference depending upon the
Speaker 1: outcome of the next election regarding what happens in the
Speaker 1: transportation sector. Let's talk about US emissions mix and started
Speaker 1: part of the power sector actually, which has to do
Speaker 1: with gas and oil. So oil and gas, what does
Speaker 1: that look like in the future, because the US has
Speaker 1: sort of had a I think renaissance was the word
Speaker 1: that in our discussions of leading up to today, Ethan
Speaker 1: you were saying regarding natural gas and is now a
Speaker 1: net exporter? Yeah, I mean so basically, you know, the
Speaker 1: US had just reached the point where we were effectively
Speaker 1: almost a net energy exporter, uh. And we're you know,
Speaker 1: a net oil exporter. Uh. And we're ramping up gas exports.
Speaker 1: And then of course a long came this year, which
Speaker 1: is completely disrupted demand for petroleum products. But it is
Speaker 1: just kind of amazing the level of the surge that
Speaker 1: we saw a so called unconventional production of oil and gas.
Speaker 1: I think there are very big questions obviously about where
Speaker 1: we go from here. First, of course, there's the industry itself,
Speaker 1: which is now suddenly a lot of pain and had
Speaker 1: been burning through cash, let's be clear, for quite some time,
Speaker 1: even before COVID nineteen arrived, but now all of a sudden,
Speaker 1: with a lower oil price environment UM, oil and gas
Speaker 1: producers are definitely suffering from that. So that's the that's
Speaker 1: the backdrop that we have here. The look forward, and
Speaker 1: the piece that I'm sort of interested to see how
Speaker 1: it gets resolved is, as Steph mentioned earlier, at least
Speaker 1: on the power side, Biden is pledging to get us
Speaker 1: to zero percent CEO two emissions from our power sector
Speaker 1: by well, you know, if about of our power last
Speaker 1: year came from gas, that's a lot of gas demand
Speaker 1: that would in theory disappear. Uh. And then the question
Speaker 1: is can let gas be used in some other way?
Speaker 1: Is there enough of an export market on l n
Speaker 1: G to make up for that, or there are other
Speaker 1: segments of the economy UM where gas can be used.
Speaker 1: And we still we certainly have a number of homes,
Speaker 1: particularly in New England for instance, that are using oil
Speaker 1: to heat their homes. Could gas be used there? But
Speaker 1: practically speaking, if you were to basically evaporate what is
Speaker 1: something I'm guessing about thirty or forty percent of total
Speaker 1: gas demand in the US. By going to zero percent
Speaker 1: carbon in the power sector, that would have major implications.
Speaker 1: And so then the question is what is the Biden
Speaker 1: position on fracking? What is its position on what does
Speaker 1: the campaign edition on doing fracking on federal lands doing
Speaker 1: it on private lands? I would say I don't have
Speaker 1: a complete clarity on that question at the moment. The
Speaker 1: campaign has set a couple of different things. The other day,
Speaker 1: there was an effort when he was in Pittsburgh to
Speaker 1: make it make a point that that he's not against
Speaker 1: all fracking. And it's very worth noting that Pennsylvania is
Speaker 1: a state that has benefited enormously for fracking, specifically for gas. Uh.
Speaker 1: And so I think the politics on this one are
Speaker 1: are tricky and uh, you know, I don't think it's
Speaker 1: it's it's not at least entirely clear to me how
Speaker 1: we get to zero percent in our power sector without
Speaker 1: it affecting the gas sector. And I think there's some
Speaker 1: open questions very much on that at this point, Yeah,
Speaker 1: I would add that I think it's Biden has done
Speaker 1: himself himself no favors with his shifting positions on tracking,
Speaker 1: and when he first declared his candidacy, he was in
Speaker 1: favor of a blanket ban on the on the technology,
Speaker 1: then moved to call for a ban on fracking on
Speaker 1: federally least land only. As Ethan said, he recently told
Speaker 1: the Pennsylvania television interviewer that quote fracking is not going
Speaker 1: to be on the shopping block to remove support for tracking,
Speaker 1: which would directly hit the economies of states like Pennsylvania, Ohio,
Speaker 1: and West Virginia, which may not be important in the
Speaker 1: overall scheme of things, but do have quite a number
Speaker 1: of electoral votes among them. And which of those states
Speaker 1: would be considered swing states at this point, Well, Pennsylvania
Speaker 1: is certainly a swing state. West Virginia would not be
Speaker 1: considered a swing state. Now, how's a strange animal in
Speaker 1: that Historically speaking, no Republican has ever been elected president
Speaker 1: in the modern era without carrying Ohio. So what that
Speaker 1: means from a from a political standpoint is that, assuming
Speaker 1: history is to repeat itself, as the Trump must win
Speaker 1: Ohio in order to win the presidency. But it's not
Speaker 1: necessary for Biden to win Ohio to win the presidency.
Speaker 1: So we're thinking ahead to November when the election takes place,
Speaker 1: in January when there's the inauguration. But how about other
Speaker 1: significant dates and things that are going to exist beyond
Speaker 1: that the next president either will inherit or have the
Speaker 1: ability to continue and take forward. Well, the answer to
Speaker 1: your question has to do with this rather distinctive function
Speaker 1: that the president enjoys in the American system, which is
Speaker 1: the ability to issue executive orders and to make very important,
Speaker 1: very broad, very high impact decisions without the consent of Congress.
Speaker 1: And as a result of that, we're facing now as
Speaker 1: a situation in which President Trump, during his term has
Speaker 1: taken a number of actions that affect the energy economy
Speaker 1: that have been done with consultation with Congress, and therefore
Speaker 1: can continue to Can you to live on even should
Speaker 1: Trump be turned out of office? Let me give you
Speaker 1: some examples, all done by executive fiat. Trump withdrew the
Speaker 1: US from the Paris Climate Agreement. He vacated the Obama
Speaker 1: at Euro Clean Power Plan and replaced it with a
Speaker 1: rule that is much more diluted with regard to its requirements. UH.
Speaker 1: He rapped off offshore oil and gas leasing. He approved
Speaker 1: some major oil pipeline projects bringing imports from Canada into
Speaker 1: the US. UH he reversed the requirement that oil and
Speaker 1: gas companies monitor methane releases from their wells. He imposed
Speaker 1: tariffs on solar cells and modules and inverters, all of
Speaker 1: which are essential ingredients to solar project development, and all
Speaker 1: of which and as a result raised he raised the
Speaker 1: price of those projects. All of these things would stay
Speaker 1: in force should Trump be turned out, but because this
Speaker 1: is a double edged sword, they could be reversed quite
Speaker 1: easily should Biden decide to do so. So, really, what
Speaker 1: we have is a situation here where the election, because
Speaker 1: of the power of executive orders and because of the
Speaker 1: differences in policy between these two candidates, really is an
Speaker 1: important undertaking and commerce is more or less relive two
Speaker 1: second tier status. It's like, could just add on to that.
Speaker 1: I really agree with Steph in the sense that there
Speaker 1: are and it's a really good question data that there
Speaker 1: are a lot of initiatives that basically the administration can
Speaker 1: pursue unilaterally. I'm literally looking right now at a news
Speaker 1: story that's just run on the Associated Press of sixty
Speaker 1: projects that the US Department of Interior has sent the
Speaker 1: note to the White House about and saying we need
Speaker 1: to fast track permitting of these, and it includes things
Speaker 1: like a five thousand well gas field of development in Wyoming,
Speaker 1: the Jordan Cove Liqui fied natural gas terminal in Oregon, uh,
Speaker 1: and a natural gas pipeline that's planned for Virginia. So
Speaker 1: those are things that the administration can move quickly on.
Speaker 1: I will know caveat that everything we've just said slightly
Speaker 1: and saying that, um, there are a lot of teas
Speaker 1: that need to be crossed and eyes that need to
Speaker 1: be dotted when you give permission to have a project
Speaker 1: go forward under what's called the Environmental Protection Act of
Speaker 1: the United States. And what that means is if you
Speaker 1: don't do all the right steps, if you if you
Speaker 1: cut corners, then you're open to lawsuits. UH. And then
Speaker 1: a number of cases the Trump administration sort of had
Speaker 1: their hands slapped by courts and had various initiatives essentially
Speaker 1: stopped because they did not follow all the rules of procedure.
Speaker 1: So while you can do a lot to try and
Speaker 1: move a lot of things quickly, if you move too
Speaker 1: fast and you don't take the right steps, then ultimately
Speaker 1: your decisions may not get implemented. And then, of course,
Speaker 1: as as Steph does note um, if by wins um
Speaker 1: you know a number of these things, he can revisit
Speaker 1: himself unilaterally. Um, though some will be harder to undo
Speaker 1: than others. To be clear, once you've made a regulatory
Speaker 1: decision from an agency on something, it becomes that much
Speaker 1: harder to pull it back. Well, because in specific reference
Speaker 1: to the power sector, you know, these are pretty big
Speaker 1: infrastructure projects and they take wild to get off the ground,
Speaker 1: and then they're with us for a very long time.
Speaker 1: And what I'm hearing from you is you know that
Speaker 1: the there's only so much that someone can do in
Speaker 1: a four year period because it may all be unwound
Speaker 1: by the next president, which I think is not all.
Speaker 1: I guess maybe that's a bit extreme, but things can
Speaker 1: be unwound by the next president. Things are done by
Speaker 1: executive order, which to my understanding is not dissimilar from
Speaker 1: the transition from Obama to Trump as well, where there
Speaker 1: were a number of things that were able to be
Speaker 1: sort of be crossed off and refreshed for a four
Speaker 1: year period. So My question really is to both of you,
Speaker 1: regardless of who wins, how dramatic do you think the
Speaker 1: impact is going to be, given that you're somewhat bound
Speaker 1: by a four year period. You're exactly correct that President
Speaker 1: Obama and his term took a number of executive actions that,
Speaker 1: of course succeeded his presidency and some of which remain
Speaker 1: in force. The difference between that transition and the transition
Speaker 1: that we're going to experience in the US here next
Speaker 1: year is that the US is now laboring under a
Speaker 1: budget deficit that has never been higher in peacetime and
Speaker 1: has not been as high as it is now since
Speaker 1: World War Two. And the absence of financial or physical
Speaker 1: flexibility is a burden that regardless of who is elected,
Speaker 1: the president is going to have to deal with. The
Speaker 1: spending ability and the willingness to legislate funding for any
Speaker 1: number of programs is going to be impinged as a
Speaker 1: result of the extraordinary spending that the US has had
Speaker 1: to undertake as a result of the COVID virus. And
Speaker 1: I would just agree with Steph and with your question data,
Speaker 1: which is, you know, four years actually isn't that longer
Speaker 1: period of time, but eight years kind of is and
Speaker 1: so you know, on a number of these issues around
Speaker 1: writing regulations or permitting projects or things like that. Let's suppose,
Speaker 1: you know, the Trump administration gets it wrong the first
Speaker 1: time in writing a regulation that is weaker than than
Speaker 1: the one the Obama administration wrote. And let's suppose they
Speaker 1: then the environmental groups taken to court and and essentially
Speaker 1: pinning their ears back a little bit. And that's happened
Speaker 1: a number of times. What can then happen is that
Speaker 1: Trump can their administration can come back and rewrite the
Speaker 1: regulation again and make it slightly less weak, but have
Speaker 1: a pass muster with the courts. So I frankly, I
Speaker 1: frankly think that the second four years of Trump could
Speaker 1: be very, very harmful from an environmental perspective, because the
Speaker 1: one thing that I think those who are worried about
Speaker 1: the environment could take some stock in in the first
Speaker 1: four years of the Trump administration was to be really candid,
Speaker 1: they were pretty bad at doing certain parts of government.
Speaker 1: They just to my point earlier about dotting the eyes
Speaker 1: and crossing the teas, they often just didn't do things
Speaker 1: the right way in terms of writing the regulations. In
Speaker 1: a number of cases, they put people in some of
Speaker 1: these agencies who didn't really know what they were doing,
Speaker 1: but they're getting smarter. And the guys who had been
Speaker 1: like number two or three at some of the agencies
Speaker 1: and were lobbyists and really understand how things work moved
Speaker 1: up in the world, and they're getting better at writing
Speaker 1: regulations that will basically withstand court challenges. Uh. And so
Speaker 1: I do think that, you know, if you get four
Speaker 1: more years of Trump, a lot of the things that
Speaker 1: they've they've sort of have gotten halfway towards putting in
Speaker 1: place over the last four years, they'll they'll they'll get
Speaker 1: the rest of the way they are. So there's one
Speaker 1: thing that we haven't addressed, and I think there's been
Speaker 1: plenty of buzz over the past year on Capitol Hill
Speaker 1: about the Green New Deal. Did Biden's Energy and Climate
Speaker 1: plan address that or has that been something that he
Speaker 1: has not made a forward statement about? Biden pointed, Lee
Speaker 1: did not reference the Green New Deal in his Energy
Speaker 1: and Climate platform, and to the rest of my knowledge,
Speaker 1: he is avoided referring to it, and he'st by its
Speaker 1: formal name in any of his public appearances so far.
Speaker 1: That's right. I would say he's sort of for lack
Speaker 1: of a better term, finessed it. The one thing I
Speaker 1: would say is that he has certainly, I think, incorporated
Speaker 1: some of the ambitious ideas that in the Green New Deal. However,
Speaker 1: as part of the process of coming up with his
Speaker 1: current official climate and energy policy, there was a task
Speaker 1: force that was put together that was basically Biden people
Speaker 1: and people from the Bernie Sanders campaign, and as part
Speaker 1: of the Bernie Sanders campaign were some of the biggest
Speaker 1: champions of the Green New Deal, including Alexandria Occasio Cortez,
Speaker 1: the freshman Congress congresswoman from from Queens, New York. And
Speaker 1: so that process did solicit a lot of their ideas
Speaker 1: um and I definitely think a bunch of those are
Speaker 1: in the Biden plan. But but Staff's exactly right, it
Speaker 1: is not labeled as a Green New Deal, and we
Speaker 1: had that. Part of the problem with the Green New Deal,
Speaker 1: or He's saying its name for Biden is that he
Speaker 1: has alligned himself so closely with organized labor, and significant
Speaker 1: share of organized organized labor has concerns about the Green
Speaker 1: New Deal because of its tremendously disruptive force over existing
Speaker 1: energy industries and jobs. Some of which are unionized, but
Speaker 1: many of which are relatively high paying and for some
Speaker 1: some long time security. So Biden is is being honest
Speaker 1: to his constituency in the sense that he is avoiding
Speaker 1: directly referring to the Green New Deal as a sort
Speaker 1: of uh negative dog whistle, if you will, to his
Speaker 1: union supporters that he is aware of their concerns. Well, so,
Speaker 1: I think I speak for all of us when I
Speaker 1: say that, I think we're all going to be watching
Speaker 1: the outcome in November, and it will be very interesting
Speaker 1: to see what happens across these different sectors January and beyond.
Speaker 1: Ethan Stephen, thank you very much for joining us today.
Speaker 1: Thanks it's fun. Thanks a lot. Today's episode of Switched
Speaker 1: On was edited by Rex Warner of Great Stolk Media.
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