COMMON GROUND
The former VP’s proposal promotes electric vehicles and energy efficiency but would not ban hydraulic fracking
Biden’s energy plan with fracking gets support from oil firms.
Joe Biden won over environmentalists and liberals when he announced a $2 trillion plan to promote electric vehicles, energy efficiency and other policies intended to address climate change.
But the plan released on July 14 has also earned a measure of support from an unexpected source: the oil and gas industry that is closely aligned with the Trump administration and is a big source of campaign contributions to the president.
That might seem odd, considering the plan aims for “net-zero” greenhouse gas emissions by no later than 2050, in part by discouraging the use of fossil fuels. Biden also wants to spend more on mass transit, expand solar and wind farms and build thousands of electric vehicle charging stations.
Yet the industry was relieved by what the plan did not include, chiefly a ban on hydraulic fracturing, the approach that has turbocharged domestic production of oil and gas over the past dozen years.
“There is a lot of room in there for oil and gas,” said Matt Gallagher, president of Parsley Energy, a West Texas oil producer, about the Biden plan.
Some executives were particularly enthusiastic that Biden wanted the federal government to invest in carbon capture and sequestration, which entails preventing emissions of greenhouse gases from reaching the atmosphere and thus allowing the industry to continue burning fossil fuels for decades. In a sign of his all-inclusive, eclectic approach to energy, Biden is proposing the use of advanced nuclear reactors to produce electricity.
“There is some common ground,” said Mike Sommers, president of the American Petroleum Institute, which represents the industry in Washington and is close to the Trump administration. “We appreciate the fact that they recognize that there is going to be a role for natural gas and oil in our future. We share the broad goal of reducing emissions and addressing climate change.”
Oil and gas executives noted that they had worked productively with Democratic administrations. During the Obama administration, oil companies enjoyed handsome profits even as federal regulators implemented tougher environmental regulations.
Charif Souki, a Houston entrepreneur who pioneered the liquefied natural gas export industry, expressed enthusiasm about the Biden plan.
“At first blush, the plan is a masterpiece because he gives something to everybody,” said Souki, executive chairman of Tellurian, a gas producer that is planning a major export terminal in Louisiana. “Investment in infrastructure is great, $400 billion for research and development is phenomenal and way overdue.”
Like almost all the fossil fuel executives, however, Souki had some reservations. He described Biden’s goal of eliminating carbon emissions from the electricity sector by 2035 as “unrealistic and unachievable.” He said Biden ought to strive for “carbon neutrality,” in which emissions from power plants would be offset by planting trees and using technology to suck carbon out of the air.
Of course, most oil and gas executives would prefer President Donald Trump be reelected because he has spent the past 3 1/2 years rolling back regulations.
Fossil fuel interests have donated seven times more to the Trump campaign than the Biden campaign through June, according to the Center for Responsive Politics, a nonprofit research group. Those numbers are skewed in part because Trump has been raising money since he took office in 2017.
The president’s most ardent supporters in the energy industry said Biden’s plan was craftily intended to appear moderate so he could compete with Trump in states that produce oil and gas.
“He wants to win Pennsylvania, so he toned down that rhetoric for obvious reasons,” said Kathleen Sgamma, president of the Western Energy Alliance in Denver.
Coal executives are downright hostile toward Biden. “Their overall motive is to do away with coal miners and coal use in this country,” said Bill Raney, president of the West Virginia Coal Association.
Yet, energy executives have complaints with the Trump administration, too. Some natural gas executives privately grouse that the president’s trade war has cost them dearly because China, the world’s biggest gas importer, has bought only three cargoes of liquefied natural gas from the United States over the past 22 months.
Stef Feldman, the Biden campaign’s policy director, said it was not surprising that some oil and gas executives were open to some of Biden’s ideas. “More and more energy companies are realizing the reality of climate change, the direction consumers are headed, the direction other businesses are headed and they are making changes as a result,” she said.