DOE: Uncertainty looms as Trump team moves in

Source: Hannah Northey, E&E News reporter • Posted: Friday, November 18, 2016

A week after President-elect Donald Trump clinched a White House victory, his looming presidency is still causing shudders among Energy Department staffers unsure of what the future holds.

“It’s chaos, no one knows what … is going on,” said one career staffer who has worked on clean technology at DOE since the beginning of the Obama administration and asked not to be named. “Many of my peers do not agree with basically anything the Trump campaign stands for, and [wonder] what kind of people they will appoint. And so many of us are inclined to leave.”

A few names floated to lead the agency include Harold Hamm, Continental Resources Inc. CEO; Rep. Kevin Cramer (R-N.D.); Robert Grady, a venture capitalist who worked in the Office of Management and Budget during the George H.W. Bush administration; David Hill, executive vice president and general counsel for NRG Energy Inc.; J. Larry Nichols, co-founder of Oklahoma City-based Devon Energy Corp.; and James Connaughton, an energy industry lawyer and the former George W. Bush administration environmental adviser.

Chief among concerns are how a Trump administration could affect DOE’s $32 billion budget that is divided among energy and science research, overseeing the nation’s nuclear arsenal, and cleaning up old Cold War nuclear waste sites. What’s likely to happen, sources said, is a shifting of resources from research on renewable energy to fossil fuels and nuclear power.

Sources said the big political fights next year are likely to revolve around a small portion of the agency’s work on renewables. Possibly on the chopping block, they said, is the Advanced Research Projects Agency-Energy (ARPA-E), DOE’s technology venture arm with an approximate $300 million budget, and the agency’s loan guarantee program with a multimillion-dollar budget.

“The only part of that [loan guarantee] world I see surviving is the nuclear power plant loan guarantees,” said one source, “but no one’s been using them.”

The uncertainty appears to be fueling distress within DOE.

One source said all Obama appointees at the agency are set on leaving because there’s little information about what a Trump administration means for the agency. The president-elect, the source noted, has called for repealing regulations, especially U.S. EPA’s Clean Power Plan, and has promised more jobs in the coal industry, but little else is clear.

“Many career staff have discussed leaving — and there are rumors of early departures for retirement,” said the source. “Although some career staff that were here during the Bush years have been getting back in touch with their contacts from the Bush era and seeing whether or not they’ll be rejoining. Which honestly, I think most people at DOE would almost welcome familiar Bush appointees over the unknown.”

Room for optimism

But some former Obama officials were more optimistic.

Teryn Norris, director of PIRA Energy Group and previously an adviser to former Energy Secretary Steven Chu, said there’s been strong traditional support among Republicans and the public for clean energy research and development. What’s more, Norris said, any effort to slash federal funding for research of renewable energy technology could face stiff resistance from core appropriations members and staff on Capitol Hill.

“Even though Trump has made statements suggesting [he would] cut renewable energy budgets, and there’s certainly a possibility of that playing out, my sense is there will be resistance among some of the core appropriations staff,” he said. If there is a downgrade in renewable energy and ARPA-E budgets, Norris said, it’s likely to be modest.

Norris pointed to speculation Trump could tap Grady, a venture capitalist and private equity investor, to lead DOE.

“There’s a sense that someone with that form of expertise could actually understand the critical role that DOE plays in providing support to the private marketplace through its programs and ultimately come to see them as an asset,” Norris said.

Norris cast a more positive outlook for DOE’s offices of Nuclear Energy, Fossil Energy, and Electric Reliability and Deliverability, noting that actions in those offices align with the GOP platform and, in some instances, issues like carbon capture and storage and “clean coal,” which Trump has championed. DOE could see expanded research in nuclear technology, including small modular reactors and thorium reactors, if the platform is any indication, he said.

Jeff Navin, a partner at Boundary Stone Partners and the former acting chief of staff to Energy Secretary Ernest Moniz, noted that a Trump administration wouldn’t be able to gut renewable energy funds without the approval of Congress.

“Let’s say [Trump] decided to completely zero out energy efficiency and renewable energy and put that money into fossil, you’re talking about a $2 billion decision out of a $32 billion budget,” he said. “He can’t do that without Congress, and there’s Republican support for research. There’s no way that’s going to go to zero.”