Tuesday was truly a historic election. The Washington Post captured it well:
For Obama, there have been two convincing presidential victories; for the Democratic Party, electoral ruin at every other level. On Tuesday (assuming the most likely final outcome), the largest Democratic Senate losses since 1980. The ranks of moderate Democrats – including Mark Pryor, Mark Begich, Kay Hagan and (probably) Mary Landrieu – decimated. During Obama’s presidency, the loss of nearly 70 House seats, producing the largest Republican majority since 1931. The near-extinction of the Democratic Party in the South, including in Arkansas and Tennessee, which provided the party’s national ticket in 1992 and 1996. Full Republican control of 29 state legislatures, the highest total since the 1920s, and Republican governors in 32 states, including Massachusetts, Illinois and Maryland.
So what does the GOP sweep mean for energy, particularly the “all of the above” energy policy advocated by Daniel Yergin and others. Here are a few thoughts for consideration:
- Broad energy legislation will likely not become law in DC over the next two years. The President and GOP have never agreed on the major energy policy issues (shale, coal, renewables) and that has not changed with these GOP victories. During the lame-duck session over the next month there will be a final effort to extend the Investment Tax Credit for wind and solar, but this will be an uphill effort because of the GOP House.
- The President may be using his veto pen as a GOP controlled Congress will pass energy legislation. One Bill that could survive a veto is legislation regarding the Keystone Pipeline. However, even with a legislative override, there are still questions about obtaining all the necessary permits and whether the Canadian portion will ever be built.
- With legislative initiatives doubtful, the focus switches to the federal agencies run by the President. Here, there will be continued efforts to limit the use of coal, continued efforts to promote the use of renewables, and potential new efforts by the U.S. EPA to regulate shale.
- New efforts to promote renewable energy at the state level through passage of Portfolio Standards will be even more difficult and there may be more efforts (like in Ohio) to scale back existing renewable Standards.
In the end, Congress will likely be limited to acting on the fringes of energy policy. The President will be denied any new major initiative, being forced to act through Federal Agencies. In essence, an “Energy Cold War” will prevail for the next two years. This may not be what voters had in mind, but they will have their chance in two years to either end or continue the stalemate.