As President-elect Donald Trump rolls out his Cabinet nominations, one position Idahoans should keep an eye on is his pick for the head of the Department of Energy, expected shortly.
That pick could have real repercussions in Idaho, in particular in connection with the massive and economically important Idaho National Laboratory (INL) located west of Idaho Falls.
Possible names circulating as I write this column are Harold Hamm of Continental Resources, former Texas Governor Rick Perry, Myron Ebell with the Competitive Enterprise Institute, Democratic West Virginia U.S. Senator Joe Manchin, Devon Energy co-founder Larry Nichols, North Dakota U.S. Representative Kevin Cramer, Robert Grady of Gryphon Investors, Karen Harbert of the U.S. Chamber of Commerce’s energy institute, former Wyoming U.S. Representative Cynthia Lummis and Joseph Connaughton who served President George W. Bush as an environmental adviser.
Hamm is claiming he is not interested. Manchin is drawing significant attention as a potential Democrat in the Trump cabinet. He is a strong advocate for the coal industry.
Overall, Trump ran on the twin ideas of boosting U.S. oil & gas production and reviving the U.S. coal industry. Meeting both goals simultaneously will be a struggle. U.S. oil and gas producers are primarily struggling with world market conditions. More access to public land or a reduced regulatory environment will not fix the fact that most production is not productive as long as the world is awash in oil and gas.
Coal is even tougher. Producers are reeling from a wave of bankruptcies brought on, at least partially, by the current federal policy designed to reduce carbon emissions. Presumably, the Trump Administration will reverse Obama policies on carbon. But, the industry’s economic position is also highly impacted by the simple the fact that natural gas, a direct competitor, is just cheaper.
In Idaho, energy issues boil down the future of the INL, future demand for renewable power (wind and hydro mainly) and the impact of national policies on development of natural gas in the Payette area.
The Idaho National Laboratory has nearly 4,000 employees and a budget of nearly $1 billion a year. Pending projects include Fluor Corporation’s NuScale small modular reactor which is in the process of approval for the first full-scale test at the INL. Waiting in the wings is a multi-billion project involving 12 NuScale reactors to generate power for the Utah Associated Municipal Power Systems, a consortium of public power entities in the Rocky Mountains. Also, the Navy is looking to put in place there a $1.6 billion facility to handle nuclear waste from naval vessels. These multi-billion projects could generate thousands of construction jobs and generate substantial ongoing employment in East Idaho.
Idaho has also seen an explosion of wind projects all over the state, and Idaho dams play a key role in regional hydroelectric production. Four dams on the Snake River are under close scrutiny for their impact on salmon runs.
And, Idaho has a fledgling natural gas industry near the Oregon border around Payette.
A future DOE Secretary might impact all three Idaho areas by favoring or disfavoring nuclear development, revising incentives for renewable power, and policies designed to favor hydrocarbon development.