Regardless of which candidate sits behind the desk in the Oval Office come January 20, 2013, American consumers will demand a proactive plan by the president to lower gasoline prices, grow the economy and ensure a future where the United States is energy self-sufficient. Both candidates have campaigned on reducing dependence on overseas oil and the importance of domestic energy production for job creation and economic growth. However, their plans for getting there are starkly different.
President Obama’s plan for an energy future is anchored in natural gas development and the growth of renewable energy production. On natural gas production, he rightly pointed to the economic benefits of expanded production, including the generation of over 600,000 American jobs, as well as the capacity of natural gas to reduce our nation’s carbon emissions. Notwithstanding this support, the President has made it clear his administration will continue to press for strict environmental standards on energy production – particularly on hydraulic fracturing and offshore drilling – and will favor stronger federal oversight than state-based management.
The president’s energy plan is also anchored by federal efforts to incentivize the production and use of alternative and renewable fuels through tax credits, loan guarantees, research grants, and the federal Renewable Fuel Standard, in order to reduce greenhouse gas emissions and oil imports. On the demand side, the president has finalized new corporate average fuel economy standards, requiring automakers to raise the average fuel efficiency to 54.5 miles per gallon by 2025. In a nutshell, President Obama mostly favors lowering oil imports by lowering demand for oil.
On the other side of the ballot, Governor Romney has also stated his support for increasing domestic natural gas supplies of energy and shares President Obama’s support for the federal Renewable Energy Standard. However, the similarities between the two seem to end there.
Governor Romney has stated that he will unleash domestic energy production in order to create jobs, lower energy prices and generate government revenues. His plan centers on prohibiting new regulations on energy production and the elimination of duplicative regulations, as well as a transition of regulatory authority from the federal government to the states. In addition, Governor Romney strongly supports the domestic production and utilization of coal and has pledged to approve the Keystone XL pipeline “on day one” of his administration – a stark contrast to President Obama who rejected TransCanada’s initial permit application for the project. Governor Romney also supports ending tax credits and most federal support for renewable energy sources (with the notable exception of corn-ethanol and the Renewable Fuels Standard, which he supports).
If Republicans hold the House and Democrats hold the Senate coming out of the elections (which is increasingly likely), it will be nearly impossible for either side to enact any meaningful energy legislation in the next two years, regardless of who wins the presidency. Smaller legislative measures, including requisite funding for federal agencies, are likely, but a bipartisan movement to pass a comprehensive energy package is unlikely.
For an Obama administration in its second term, partisan gridlock in Congress would allow the President to push his energy agenda through regulation. Items on his docket will likely include efforts to expand federal regulation over hydraulic fracturing, a broad host of new Clean Air Act regulations and GHG regulations designed to eliminate coal use, new incentives or mandates for alternative fuel consumption (such as a low carbon fuel standard) and a continued push for federal funding for renewable and alternative energy projects.
Michael Whatley is Executive Vice President of Consumer Energy Alliance.