President-Elect Donald Trump is vowing to unleash American energy and begin scrapping burdensome regulations on his very first day in office, announcements welcomed by the energy industry, although they still have other goals they want to see the new administration pursue.
In a short video, Trump outlined several directives he will issue on his first day in office on issues ranging from trade and immigration to national security and ethics reform. However, promoting domestic energy and rolling back regulations were right near the top of the list.
“I will cancel job killing restrictions on the production of American energy, including shale energy and clean coal, creating many millions of high paying jobs,” said Trump in the video.
“On regulation, I will formulate a rule which says that for every one new regulation, two old regulations must be eliminated,” said Trump.
The energy industry is hopeful that the next four years will offer it a more hospitable environment than what it received during the Obama administration.
“We’re certainly encouraged by the fact that the president-elect understands that one of the key drivers to a strong economy is energy security,” said American Petroleum Downstream Group Director Frank Macchiarola.
Macchiarola believes Trump understands the need to champion domestic energy production and is fully confident the American people are on board.
“Survey after survey tells us that the American public is concerned about economic growth and believes that we need to be energy secure,” he said, but notes that Obama has left a pretty complicated knot for the new president to untangle on energy regulation.
“I think what happened over the course of the Obama administration is that there was a lot of consolidated power in the administration. I think with the division in Congress and the stalemate between both parties in the House and Senate, I think the administration took that opportunity to consolidate it’s power through a stronger regulatory agenda,” said Macchiarola.
He says those regulations had a clear impact on the energy industry.
“We have 145 current regulations that directly impact the oil and natural gas sector, whether it’s issues related to public land and access or issues related to the downstream or issues related to air or water or an issue like the Renewable Fuel standard. It’s a broad spectrum,” said Macchiarola.
Macchiarola and his allies want the Trump administration to go over every single one of those regulations and provide as much relief as possible.
“What we really would like to do is to have the new administration, with a fresh set of eyes, take a look at this regulatory onslaught that we’ve seen. And, again, consistent with their message and principles that they stated during the campaign about the need for less burdensome regulations here in Washington, free up capital to be invested in the private sector and the nee for secure U.S. domestic energy production,” said Macchiarola.
One of the policies Macchiarola is most concerned about is the Renewable Fuel Standard, or RFS, and the increasing amount of ethanol being required in our fuel. He says the RFS was created last decade to help boost energy independence at a time when the U.S. was importing vast amounts of energy.
He says the policy no longer fits the reality.
“What they didn’t know is that we would have an American energy renaissance. Because of the shale revolution here in the United States and the energy renaissance, we’re now producing greater and greater amounts of oil and natural gas. We’re the world’s leading producer of oil and natural gas,” said Macchiarola.
“At the same time, demand for energy has essentially flat-lined. So what you’ve seen is America become more energy secure over that time,” he added.
Macchiarola says addressing the RFS is critical now because the amount of ethanol about to be required in gasoline is incompatible with the vast majority of American vehicles.
“(It) creates an issue because it potentially adds cost to the consumer both through food and fuel. And these higher ethanol blends above E10 are incompatible with the cars we have on the road today. So the bottom line is the RFS is a mess, and it really needs to be fixed,” said Macchiarola.
Bipartisan legislation to address the Renewable Fuel Standard exists in the House of Representative but has not yet been considered.