NOIA Fall Meeting October 4, 2017 Karen A. Harbert

“Situational Awareness”

Monumental Changes by 2050

The New Energy Reality Demand to increase 56% by 2040 Energy Security is central to our national and economic security Demand to increase 56% by 2040 90% in non-OECD countries Electricity demand to increase 76% 1.6 billion people without electricity ~$40 trillion of new investment by 2035 to meet rising demand

An Inconvenient Energy Truth

Global Energy Demand

Future U.S. Energy Demand

Energy Reality Check

Moving from 2% to 3% average annual growth would mean doubling our income (GDP per capita) 12 years faster (23 versus 35 years). Moving from 2.5% to 3% average annual growth would raise average incomes by an additional $4,200 and create 1.2 million jobs over the next decade. Moving from 2% to 3% average annual growth would reduce the national deficit/debt by more than $3 trillion over the next decade.

Energy is 1/3 of all US Investment

Play-by-Play Look at New Energy Reality

Shale Gas and Manufacturing Growth 294 new chemical industry projects due to shale gas planned, totaling $179 billion in new capital investment 104 of these projects are in Texas - totaling $51 billion

Policy Matters!

Oil Exports on the Rise

Energy Security Rapidly Increasing

LNG Exports Boosting Gas Demand November 2016: U.S. becomes net exporter of natural gas for first time in 60 years By 2040, LNG exports will exceed 6.7 trillion tcf

Energy and Environmental Policy Outlook

Trump Considerations JOBS, JOBS, JOBS 3 Es: Economy, Energy, Environment AND not OR Personnel is policy Energy/Environment Policy Actions Early emphasis: Executive Actions (KXL, DAPL, CPP, NEPA, SCC, Methane, Permitting) Congressional Review Act (CSAPR, Methane, Stream Protection Rule) TRUMP (MARKET) VS CLINTON (MANAGED OUTCOME)

Executive Actions to Watch ACCESS: Permitting, permitting, permitting EXPORTS INFRASTRUCTURE: Permitting OPTIMIZE UNNECESSARY REGULATIONS Regulatory reform task forces EPA Cost-Benefit Accounting Social Cost of Carbon

Regulation Nation: What is and What Should Never Be Recently Finalized Regulations Impacting Energy:

Outlook for Regulatory Relief Agency Guidance/Decision-making Executive Order Formal Regulatory Process (*Litigation Alert*) Congressional Review Act Reconciliation/tax reform Appropriations/must-pass bills “Regular order” legislation (filibuster-able)

Legislation to Watch Tax Reform, Infrastructure Package Regulatory Accountability Act (passed House Jan 11th) REINS Act (passed House Jan. 5th) Endangered Species Act Clean Water Act (define “navigable waters”) Clean Air Act “Rifle Shot” reform/GHGs NAAQS New Source Review

A Return to Cooperative Federalism Clean Air Act: “air pollution prevention…at its source is the primary responsibility of States and local governments.” Clean Water Act: “It is the policy of the Congress to recognize, preserve, and protect the primary responsibilities and rights of States to prevent, reduce, and eliminate pollution.”

A Return to Cooperative Federalism As of November 2016, the Obama EPA had Promulgated a record 57 FIPs! State Regulatory Takeovers By Administration

Anti-Energy Environmentalism Evolves and Goes Mainstream

Economic Growth & Environmental Progress

The New Environmentalism 1970s – 2000s: pursue safer and cleaner fossil fuel use that is achievable at a reasonable cost. Today: Eliminate fossil fuels entirely. AEP/SWEPCO Turk Plant: 1st Ultra Supercritical plant in the country is now illegal to build and operate because of CO2 regulations.

Keep It In The Ground Intensifies No Mining No Fracking No Power Plants No Exports No Pipelines

New Battleground: Pipelines

Energy Infrastructure Under Assault

KIITG Tactics: Whatever Works Public Relations Litigation Permitting/regulatory processes (NEPA, ESA, etc) Landowner organization/eminent domain Native American issues Investor pressure/divestment Local elections “Direct Action”/civil disobedience

Global Energy Institute 1615 H St NW, Washington, DC 20062 globalenergy@uschamber.com 202.463.5558 www.globalenergyinstitute.org Global Energy Institute 1615 H St NW, Washington, DC 20062