The landscape of energy is evolving, and Wyoming needs to follow suit if it intends to remain competitive in the market.
This was the overriding message echoed by the speakers and panelists at the sixth annual Energy Summit in Gillette May 7-8, sponsored by the Wyoming Business Report.
“The markets have spoken,” Campbell County Commissioner Mark Christensen said in his opening comments. “Regardless of what you might personally think about climate change, the markets think it’s an issue.”
Given that 40% of the energy produced in Wyoming goes to fuel other states, their policies with regard to climate change are very much driving the market, he noted.
Christensen, like other summit presenters, views the decline in the demand for coal as an opportunity to innovate. There isn’t a short-term solution, he pointed out, and instead suggested focusing on the long-term investment in carbon renewables and incentivizing research opportunities through partnerships with the University of Wyoming and other entities to maximize funding opportunities and attract talent.
“Research drives business,” he said, “and we need to find new opportunities for Wyoming products that make good economic sense.”
Others were more pragmatic about the state’s late rebound in looking forward.
“Wyoming is about 10 years too late,” state Rep. Michael Von Flatern, R-Gillette, said during the policy roundtable discussion that followed with fellow legislators Rep. Mike Greear, R-Worland, and freshmen representatives Rep. Shelly Duncan, R-Lingle, and Rep. Sara Burlingame, D-Cheyenne.
Greear reiterated sentiments from both Christensen and Von Flatern, noting that the progressive decline in the demand for coal will directly impact tax dollars if the state doesn’t act quickly to mitigate the loss.
“The decline will continue,” he said, “and will have a huge impact in three years, and we need to do something about that.”
Others on the panel agreed, including Burlingame, who suggested reworking the state’s marketing campaign when it comes to being a major energy supplier.
“The market has said clearly that our attempts to sell clean coal haven’t been successful,” she said. “We need to take that deficit and turn it into a positive.”
Fellow freshman Duncan picked up that thread and touted the value of “telling our own story” and “rebranding ourselves as innovators.”
Regulatory uncertainty was another issue raised by the panel, as well as the length of time it takes for the permitting process, particularly in oil and gas. Greear said he would like to see this tackled in the next legislative session, suggesting the creation of a regulatory body to fill the void of the state’s lack of an energy department.
“Having one authoritative body to oversee the permitting and regulatory process would speed up gas and oil production and be a boon to the state,” he said.
The greening of Washington
“This is not a good time for coal,” said Landon Stropko, a Republican energy lobbyist and former legislative director for U.S. Sen. Mike Enzi, R-Wyo. As a lobbyist in D.C., Stropko has seen firsthand the impact on policies like the Green New Deal, which was introduced in February by Rep. Alexandria Ocasio-Cortez, D-N.Y., and Sen. Ed Markey, D-Mass., and voted down in March.
And though technically the Green New Deal does nothing but make a statement, Stropko said, it nonetheless underscores an agenda supported by many in Washington, who are writing the legislation that impacts major energy producers like Wyoming.
Having a pro-coal Republican president does little to reverse the past, he noted.
“Policy is slow to change,” he said, “and President Trump’s pro-gas and oil agenda is not enough to drive policy or undo past legislation, such as pulling out of the Paris Climate Accord, which will not go into effect until December 2019.”
Much of the current energy policy, which has been in effect since 2005, is predetermined by prior court rulings, added Kip Coddington, director of energy policy and economics at the University of Wyoming’s School of Energy Resources. He cited a 2007 Supreme Court ruling that declared carbon dioxide an air pollutant subject to regulation, as well as the recent ruling by U.S. District Judge Rudolph Contreras that blocked new oil and gas drilling on nearly 500 square miles of Wyoming’s public land as ways that government decisions impact energy development.
“It’s the law,” Coddington said, “not a market preference.”
Nonetheless, like other presenters, he touted the advantages Wyoming stands to gain by taking a proactive stance, suggesting that Wyoming study how other states, like Colorado, have adapted clean energy policies augmented by fossil fuels. Legislatively, he’s in favor of incentivizing the development of low-carbon technologies and developing specific low-carbon policy strategies that support diversifying resources to maximize return. Opportunities like grid-scale storage and low-carbon projects could have significant commercial relevance, he noted, and huge economic impact for the state.
“Diversification is imperative,” he said, “and I’m ruthlessly optimistic in our potential.”
Electric cars driving green energy market
The future is electric vehicles and charging stations, according to Richard Horner, director of emerging technology at University of Wyoming’s Energy Innovation Center. And like climate change, one’s personal opinion on their efficacy is irrelevant.
As the EV market continues to catch on throughout the nation, Horner suggested that Wyoming stands to profit by being a provider of clean energy and figuring out how to tap into the grid to provide for those markets.
“Markets are driven by disruption, and this disruption is going to affect everybody,” he said. “Suffice it to say, it is a good opportunity for Wyoming to start to see EVs as their friend.”
As states like California and Colorado rely more and more on renewables and clean electricity, their power grids are going to become increasingly strained, Horner pointed out, and Wyoming can step in to fill that void.
“Energy efficiency has become a very important feature in how we see energy markets. If the market continues to lean toward (electric vehicles), the grid would have to change faster to meet the demands of those vehicles.”
The rest of the country is already behind the curve, he noted, but Wyoming has poured significant resources into studying carbon capture and sequestration, which, if tied into the energy grid, could be a major provider during the off-hours.
“Renewables are not going to meet the demand for EVs,” he said. “The sun doesn’t shine at night, and in some of those areas, like New York, renewable energy is not really suited to those areas.”
Likewise, he concluded, Wyoming is equally blessed when it comes to renewables like solar thermal, which hasn’t caught on to the same degree as wind. Like others, he sees the future in hybrid renewables.
“People don’t want to think that way, because either you are pro-coal, pro-wind or pro-solar,” he said. “It’s not one or the other, but it is finding a way to integrate all of them together.”
Keynote speaker Jonathan Weisgall, vice president of legislative and regulatory affairs at Berkshire Hathaway Energy Company, picked up this thread in his closing address.
He said he sees the future of energy in hybrid energy markets with interconnected grids driven by customer demand, and balancing the energy market with independent energy providers forming regional partnerships to lower costs for consumers and reach a greater demand.
“This whole market has evolved without legislation, moving forward in the private sector without governance,” he said.
Like others, he sees the future in hybrid renewables and non-carbons and developing large-scale transmission to tap into the larger market, instead of operating as regional fiefdoms. Wyoming’s history of rugged individualism in this regard works against it when it comes to forming partnerships, he noted.
He suggested that Wyoming consider tapping into its wealth of wind and solar to provide for other markets desperate for off‑peak‑hour energy.
“California is desperate for energy when the sun sets,” he said. “They are producing so much during the peak of day that they can’t keep up with demand. Wyoming needs more large-scale transmission to tap into its huge potential.”
Bringing it full circle, Berkshire concluded that electric vehicles and charging stations are not new concepts. The first electric car was invented over a century ago, in 1912. Women preferred to drive electric vehicles because they were cleaner than those driven by fossil fuels. Back then, they were in the 90-mile range, he noted, and today, they’re around 200, should anyone question the power of consumer preference.