Sector faces ongoing challenges in U.S. politics
Date posted: June 19, 2013
Editor’s note: This is the third in a weeklong series of articles on the local and regional energy sector titled “Big Bang: The boom and bust energy industry.”
SHERIDAN — When Wyoming Gov. Matt Mead released his long-anticipated state energy strategy midway through May, he admitted that despite major concerns surrounding the future of the nation’s energy industry, it had sometimes been difficult to point the finger at the feds in good conscience.
“It’s hard to complain too much about them not having a strategy when we in Wyoming didn’t have one,” he said.
But following the release of the newly drafted statewide plan, Mead is hopeful that Wyoming has positioned itself to advocate for a paradigm shift in the national conversation on energy.
As one of the leading producers and exporters of energy nationwide, Wyoming’s stake in the issue could rightly be called enormous.
According to figures from the Bureau of Economic Analysis, mining accounted for roughly one of every three dollars of economic activity generated in Wyoming in 2011.
What’s more, economists say the subsequent financial ripple effects contribute additional millions to state and local coffers.
The energy strategy — which Mead described as a document that will evolve over time — outlines 47 key initiatives relating to themes of economic competitiveness, regulation, environmental health and public education.
In a recent conference call with reporters, the governor said he expected the document to guide future conversations regarding the state’s energy industry.
And while similar conversations at the federal level continue playing out amid partisan rancor, lawmakers in Wyoming say that despite the national uncertainty, they’re dedicated to ensuring a robust state of affairs for the years and decades to come.
Wyoming in Washington
For members of Wyoming’s congressional delegation, the challenge of advocating for increased energy production is often a matter of tailoring their arguments to the concerns of specific groups.
“You use the argument that works with the person you’re talking to,” said Sen. John Barrasso, R-Wyo.
Barrasso added that while the production of affordable energy and general energy independence remain popular bipartisan issues, residents and lawmakers from states with limited stake in energy production often aren’t inclined to support some of the causes that matter most to Wyoming.
Barrasso, who describes Wyoming as “the Saudi Arabia of coal,” said he’s found other members of the Senate to be mostly receptive to efforts aimed at increasing production of domestic energy.
“We’re bound together in a bipartisan way to continue to speak for affordable energy,” he said.
Currently, Barrasso serves as the only Republican on both the Senate Energy and Natural Resources Committee and the Committee on the Environment and Public Works.
In his work with those two bodies, Barrasso said he has managed to work with his Democratic counterparts in Congress to advocate for a more robust and independent national energy industry.
Recently, he introduced a bill to give NATO allies the same preferential treatment as other U.S. free trade partners with respect to exports of natural and liquefied natural gas.
What worries Barrasso, however, is the onset of new environmental regulations and mounting opposition from groups he characterizes as “environmental extremists.”
“To me, solar and wind energy ought to be a complement to and not a substitute for (traditional energy production methods),” he said. “The demand for energy is growing faster than renewable energies can even come online.”
According to predictions from the U.S. Energy Information Administration, renewables are set to grow faster than fossil fuel use for the next several decades but will continue to lag behind traditional energy sources in terms of overall contribution.
While highly contingent on several political and economic factors, the EIA estimates the share of U.S. electricity generation from renewable energy will grow from 13 percent in 2011 to 16 percent in 2040.
Politicians like Barrasso point to similar figures as evidence of the continued importance of resources such as coal.
Still, concerns regarding the environmental effects of climate change loom large over the national conversation.
In Wyoming, some economic development leaders say tactics that focus exclusively on economics are destined to fail in the 21st Century.
While he believes heavily in the importance of coal production to the local economy, Forward Sheridan Executive Director Jay Stender said concerns about climate change and other environmental effects related to the use of coal are unlikely to go away.
“The onset of air emission controls from the Obama administration didn’t occur overnight,” he said. “And that (they are) coming with such an impact on the power industry kind of makes it seem they were a little behind the times.”
Global development curve
If there’s one thing Wyoming politicians have in common when it comes to their opinions of the federal government, it’s a perceived lack of leadership on the energy front.
“It seems to me the federal government does not have a sound energy policy or energy strategy and that’s problematic,” Mead said recently.
In Cheyenne, state lawmakers have lauded Mead and his staff for their recent completion of the energy strategy. In the face of disjointed efforts by federal agencies and federal legislative bodies, many Wyoming representatives believe the first step toward developing a comprehensive national energy policy is to set an example at the local level.
“I think the governor has taken a marvelous lead in creating a state energy plan and encouraging our sister states to do the same thing,” said Rep. Tom Lubnau, R – Gillette.
The current Speaker of the Wyoming House of Representatives, Lubnau has taken the lead on energy issues through several industry and environmental legislative committees.
For his part, Lubnau said he believes concerns about climate change ought to take into account the rapid urbanization of countries such as India and China.
“They’re not willing to give up the things that you take for granted in their lifestyle,” Lubnau said. “They’re going to follow the same (development) curve that we followed.”
Indeed, many of the parties advocating for increased energy exports to developing countries argue that regardless of whether their provider is the United States or any other nation, emerging nations will find a way to import fuels — whether dirty or not — for the lowest possible price.
“If you’re running a power plant in Shanghai, you don’t really care (where the coal comes from),” Stender said.
In Wyoming, many state and community leaders share Stender’s sentiment. They argue the United States should be aggressive in marketing abundant and relatively clean Powder River Basin coal.
“We can stick our heads in the sand, but the developing countries are going to find coal in other places,” Lubnau said.
But the threat of a future riddled with catastrophic change remains, and lawmakers are left in something of a precarious situation.
With that in mind, many Wyoming politicians believe states should be granted greater authority to develop their own energy resources while simultaneously being charged with protecting their natural resources.
“Wyoming is still one of the most beautiful places in the world, and it’s because we’ve been good (environmental) stewards,” Barrasso said.
And while they claim to be hurting in the moment, Stender believes coal companies will learn to adapt to changing times.
“The coal companies have incredible intellectual capital, political capital and just base foundation knowledge,” he said. “They should be able to articulate and position coal as inexpensive, safe power.”