Election 2012 and energy recap

With yesterday's general election behind us, people across the United States are considering its impact on energy policy.  From President Obama's retention of the White House to state elections and ballot measures, voters have reshaped the energy landscape.  Here are some highlights:

• President Obama wins reelection.  Obama's win may mean "more of the same" when it comes to energy policy.  President Obama has indicated support for increased domestic production of natural gas and oil, as well as for programs to encourage the development of renewable electric generation.  While the U.S. Department of Energy remains under scrutiny for loan guarantees it offered companies like Solyndra, Obama's reelection likely means that the Department of Energy will not face as strong a shakeup as it would have under a President Romney.  Still, many observers expect Secretary of Energy Steven Chu to be replaced.  The U.S. Environmental Protection Agency will likely continue to develop regulations covering energy-related emissions such as ozone, coal ash, and sulfur from fuels.  These regulations have effectively been on hold pending the election.  EPA Administrator Lisa Jackson may continue to lead the agency.  Likewise, Interior Secretary Ken Salazar has indicated his desire to remain Secretary of the Interior; in Obama's second term, the Department of the Interior is likely to continue its current course in leasing land for oil and gas production as well as for renewable energy production.

• Congress remains divided.  At the federal level, Democrats held onto control of the Senate, while Republicans retained control in the House.  The chambers' partisan nature may lead to gridlock, or at least to consensus-based, relatively moderate measures as the only kind of legislation likely to meet the approval of both chambers of Congress.

• Michigan rejects constitutional amendment on renewable energy.  Michigan voters rejected a proposed amendment to the state constitution that would have increased the amount of renewable energy that utilities must buy to serve their customers.  Proposition 3 would have required electric utilities to generate at least 25 percent of their annual retail sales of electricity from renewable energy sources by 2025.  Only 36% voted in favor of the measure to increase the renewable portfolio standard, meaning the RPS initiative failed.

Other election results, ranging from congressional races to state governor contests, will also shape energy policy in 2013 and beyond.  People and businesses that can react quickly will be in a better position to capitalize on the election results.

How Election 2012 affects energy policy

Today voters across the United States cast ballots in the 2012 general election. At stake are a broad range of political offices, ranging from the presidency to local municipal roles. How will the election's outcomes affect energy policy, energy-related businesses, and consumers?

The presidential contest has drawn the greatest attention over the past year. Whether President Obama will retain his office or Governor Romney will take the White House is the largest question. Based on the candidates' past actions and current campaign platforms, voters have some sense of how each would exercise his presidential powers. On energy issues, both candidates appear to favor increased domestic production of natural gas and oil. The candidates differ in their philosophies on the role of governmental incentives and subsidies -- whether for fossil fuel production or for renewable electricity generation -- and on emissions regulations for coal-fired and other power plants. The candidates also disagree on specific energy projects and programs ranging from the Keystone XL pipeline to the Navy's Great Green Fleet biofuels initiative.

Beyond the presidency, federal elections will determine the composition of Congress. While energy policy is more sensitive to presidential changes than to individual congressional elections, the makeup of Congress drives federal energy policy in the aggregate. All seats in the House of Representatives are up for grabs, as are a third of Senate seats. Of the 33 Senate seats, Democrats need to win 21 seats to retain their majority while Republicans need to win 14 seats to take control. The senators elected in 2012 will participate in setting any national energy policy.

State elections will also shape energy policy for the coming years. Voters will select governors in 11 states, and state legislative offices are widely contested. While federal energy policy draws the most attention, the U.S. federalist system leaves significant authority to individual states to set their own policies on energy issues. For example, states may establish electric renewable portfolio standards or otherwise regulate the resource mix used to produce usable energy. The outcomes of state elections will also affect policies on energy efficiency, smart meters and smart grid infrastructure.

Voters in some states will also cast ballots on measures directly affecting energy policy, such as the Michigan citizens' initiative seeking to increase utilities' use of electricity produced by renewable resources.

It may be some time until all the ballots are finally counted, but by tomorrow night we will have a better understanding of the results for most of the races and ballot questions. Those who can translate the election results into an understanding of future policies - and business opportunities - will have a leg up on the competition.