What happened in 8 state energy battlegrounds

Source: By E&E News staff • Posted: Wednesday, November 4, 2020

Coal-rich Montana elected its first Republican governor in more than a decade last night as ballot initiatives and statehouses were decided that could affect energy policy for years to come.

Voters in North Carolina and Texas kept the GOP in power in the state legislature, despite a push from Democrats, although several battles — including the fate of the Pennsylvania Legislature — were not fully clear at press time.

Here are the results of state elections in 8 key energy states:

Montana

In one of the few states with a gubernatorial toss-up race this year, Rep. Greg Gianforte (R-Mont.) was declared the victor in Montana, defeating Lt. Gov. Mike Cooney (D). The outcome has repercussions for energy policy, considering the state has the largest recoverable coal reserves in the country.

Gianforte, a strong backer of President Trump, has been outspoken on boosting the state’s industry, telling Northern Broadcasting System before the election that he would advocate as governor for increased port capacity on the West Coast to get coal to market.

“We should be investing in technology to make sure we can burn that coal cleanly,” he said.

Since taking office in 2017, he also has been outspoken against the Obama-era Clean Power Plan and advocated for extended federal tax credits for “clean coal” (Energywire, Sept. 22). He pushed for the state to have some control over public lands, a stance that drew attacks from Cooney.

His Montana “comeback plan” calls for new leadership in state energy agencies and development of coal, oil and gas, stating there should be more streamlined permitting of those resources.

Montana is considered reliably red in presidential elections but has had a Democratic governor since 2005. Outgoing Gov. Steve Bullock (D) was term limited.

North Carolina

Roy Cooper has secured a second term as governor of North Carolina, but Democrats lost ground in the state Legislature, a body they hoped to overtake.

Cooper, a Democrat, won 51.5% of the vote, compared with GOP Lt. Gov. Dan Forest’s 47%, with more than 94% of precincts reporting, according to the Associated Press. The incumbent governor’s response to the COVID-19 pandemic was likely a key factor.

Cooper’s win is significant for North Carolina’s ongoing transition to a clean energy state. It is the first in the Southeast to set a net-zero-carbon goal for 2050. A Forest victory could have threatened that target (Energywire, June 5).

While energy and environmental issues typically take a back seat to health care, education and other hot-button issues when it comes time to vote, North Carolina’s residents and businesses typically pay more attention to the former topics. What’s more, the state is hurricane prone and has been battered by back-to-back storms in recent years, making climate change a prominent issue.

Cooper has been adamant about changing the state’s energy profile to make it more resilient against extreme weather and natural disasters.

During his first term as governor, he overhauled the state’s Department of Environmental Quality and filled the seven-member North Carolina Utilities Commission with his picks. But he’s had to do battle with the Legislature, where the GOP held a supermajority until the 2018 midterm elections.

Democrats failed to take control of the Statehouse, where lawmakers could address elements of the North Carolina Clean Energy Plan next year. They needed a net gain of six House seats and five Senate seats to win a majority, but Republicans defeated several incumbent Democrats in races where most votes have been counted, according to the North Carolina State Board of Elections.

How lawmakers vote on energy issues typically highlights their inextricable link with a key part of the plan’s success: Duke Energy Corp.

The state’s largest electricity provider and one of the biggest energy companies in the United States has outlined a clean energy transition of its own (Greenwire, Sept. 2).

Broadly, Duke supports Cooper’s goals, but executives know those targets come with an overhaul to the power grid and to a decades-old business model.

“Changes to the regulatory construct are a vital part of achieving North Carolina’s energy objectives in the long term,” Duke CEO Lynn Good told analysts during the company’s financial earnings conference call a year ago (Energywire, Nov. 12, 2019).

Texas

As of press time, Republicans appeared likely to hold on to control of the Texas Legislature, despite an influx of new voters.

The GOP also held on to the state Railroad Commission, a powerful regulator that oversees oil and gas drilling and the pipeline industry in the top energy-producing state.

Republican Jim Wright was ahead of Democrat Chrysta Castañeda, 53.2% to 43.3%, in unofficial returns. Wright overcame a significant funding disadvantage.

“Texans have spoken,” Wright said in a statement. “Our state is not for sale to radical liberals from New York and California.”

The three-member commission, which hasn’t had a Democratic member since 1994, has been criticized for allowing widespread flaring of natural gas in the oil field. Wright has said he favors a light-handed approach to the problem, such as encouraging more pipeline construction to help get the gas to market.

Wright, who is making his first run for office, beat a well-funded incumbent in the Republican primary. Castañeda raised $3.7 million in September and March, including $2.6 million from former New York Mayor Michael Bloomberg. Wright raised about $370,000 during the same period.

Wright is still facing two lawsuits accusing him of misconduct in connection with an oil field service business that he founded. He paid a $181,500 fine to the Railroad Commission in 2014 to settle environmental violations at the site. Wright said the violations happened after he sold the business, and he’s fighting the lawsuits and said he paid the fine after his former partners mishandled the business (Energywire, Sept. 15).

The outcome of the legislative races is being closely watched because state lawmakers will address a range of issues, including a tight state budget and potential legislation on energy policy. Democrats picked up several seats in the 150-member state House in 2018 but didn’t appear headed for a major gain at press time.

The Legislature will also draw the districts for Texas’ congressional delegation, where Republicans hold 22 of 36 seats. Democrats have complained that the districts are heavily gerrymandered. Texas is expected to gain at least two seats in Congress when the results of the census are announced, because of its population growth.

The election broke records for turnout as younger, Hispanic and Black voters flocked to the polls. About 9.7 million people voted early in this year’s elections, surpassing the total turnout in the 2016 election by more than 700,000 votes.

About 57% of voters 18 to 29 favored the Democratic presidential ticket, while 61% of voters over 65 favored Trump, according to an October poll by the University of Texas.

Pennsylvania

In Pennsylvania, the legislative race was still up in the air by press time. The state is expected to continue counting ballots throughout the week.

“As expected, Pennsylvania voters are going to have to hang tight to see the results for most of the most competitive races in the General Assembly and, with it, which party will control the state Legislature for at least the next two years,” said David Masur, executive director of PennEnvironment.

The stakes are high in the Keystone State, a big energy producer and consumer. If successful, Democrats could pursue comprehensive climate change legislation on par with Virginia’s landmark Clean Economy Act, which was passed after the Legislature flipped in 2019 and which requires net-zero carbon emissions by 2045, analysts say.

New Mexico

New Mexico will join the majority of states by switching from an elected electric utility commission to one with nonpartisan appointed measures.

In the Land of Enchantment, 55% of voters yesterday said they approved of Constitutional Amendment 1, a measure backed by Gov. Michelle Lujan Grisham (D) and environmental groups to restructure the Public Regulation Commission (PRC).

Changing the commission from a five-person body whose members are elected to a three-person commission with members appointed by the governor will better ensure that qualified individuals oversee utilities as they reduce fossil fuel reliance, supporters say.

Under a bill signed by Lujan Grisham, most utilities in New Mexico must generate 50% of their electricity from renewable sources by 2030. Critics say the PRC, however, has been slow to help carry out this mandate.

“In New Mexico voters have shown we want clean energy leadership. Now we need an expert PRC that can implement that vision, not politicians that might second guess it,” Noah Long, director of the Natural Resources Defense Council’s climate and energy program for the West, said in a recent blog post in support of the amendment.

Proposed through legislation co-sponsored by state Sens. William Payne (R) and Peter Wirth (D), the amendment also had backing from a majority of members of the New Mexico Legislature.

Opponents included at least two of the PRC’s current commissioners, who said the change will result in rural areas losing representation and in utilities exerting more influence on the commission.

Louisiana

In Louisiana, voters opposed a constitutional amendment that would help lower the property tax burden for liquefied natural gas terminals and other large-scale industrial sites.

About 63% of voters rejected Amendment 5, according to returns from the Louisiana secretary of state.

The amendment would have granted companies more leeway to negotiate with local counties, cities and school boards, rather than paying based on their assessed value.

Critics said it would have undone some of the progress Louisiana has made in recent years. Louisiana allows an exemption to property taxes for industrial sites that create new jobs. Until 2016, a state board was in charge of approving the exemptions, and it only rarely refused a request, even for projects that didn’t create many jobs.

Under changes approved by Gov. John Bel Edwards (D), local governments began to vote on property tax breaks. St. James Parish, outside Baton Rouge, recently turned down a request that would have exempted a hydrogen plant from $24 million in local taxes, The Advocatereported.

In addition, some industrial projects have opted not to ask for tax breaks rather than run the risk of rejection, said Broderick Bagert, an organizer for the nonprofit group Together Louisiana.

“That is what public exposure and sunlight do,” he said.

Amendment 5 would make it easier for some facilities to negotiate alternative deals, known as payments in lieu of taxes. Bagert and other opponents have said the amendment was intended to benefit Cameron LNG, a gas-export terminal on the Gulf Coast. The plant’s existing property tax abatements are scheduled to run out soon.

Alaska

In Alaska, voters were leaning against an initiative that would raise production taxes on some oil fields, and it could take weeks to learn the outcome.

Measure 1 would boost taxes on part of the state’s oil production. The taxes are narrowly tailored to apply to existing fields on the North Slope that have been producing for several years (Energywire, Dec. 10). As of press time, about 57% of voters were opposed, with fewer than half of precincts reporting.

A group of activists collected ballots around the state earlier this year to force a vote on the tax plan. The oil industry has spent about $20 million in advertising and other campaign expenses trying to kill the plan.

“I think it’s going to be a close election,” Alaska Oil and Gas Association President Kara Moriarty said in an interview before the vote.

Proponents, organized as “Vote Yes to Alaska’s Fair Share,” say the plan would help stabilize the state government’s finances by reversing tax cuts the state Legislature passed. Lawmakers rolled back taxes on oil production in 2013, intending to attract investment to the North Slope, but production continued to fall. The state’s general fund budget has been slashed from $8.2 billion in fiscal 2013 to $2.6 billion in fiscal 2019, and hundreds of state employees have been laid off.

The oil industry said the tax plan would discourage new investment, even if it applies only to older oil fields (Energywire, Nov. 2).

The state won’t start counting tens of thousands of mail-in and other absentee ballots until Nov. 10, as part of a process intended to keep people from voting twice, Gail Fenumiai, director of Alaska’s elections division, said in an email. Votes that were cast on Election Day, along with in-person early votes received before Oct. 29, were tallied starting last night.

Nevada

Environmentalists in Nevada have reason to cheer if results hold in the Southwestern state backing a ballot question that would add a clean energy mandate to the state constitution.

As of press time, more than 56% of voters backed Nevada Ballot Question 6. The proposal would add language to the constitution requiring utilities to generate half their electricity from renewable sources by 2030. Voters backed the measure in 2018, but under state law it needs to be approved twice for enactment.

Nevada is already moving toward 50% renewable electricity by the end of the decade, but modifying the constitution would make it more difficult for lawmakers to try to roll back the mandate, according to supporters.

About 67% of the state’s electricity currently comes from natural gas.

“To make sure that Nevada continues to move toward clean energy, no matter who is in office, we need to affirm our commitment to renewable resources and pass Question 6,” Dylan Sullivan, senior scientist with the Natural Resources Defense Council’s climate and clean energy program, said in a recent blog post in support of the amendment.

Although a coalition of current and former republicans in Nevada opposed the measure in 2018, no political action committee was registered in opposition this year, according to Ballotpedia. Americans for Tax Reform, a conservative, self-described taxpayer advocacy group, wrote the official opposing argument that appeared in the 2020 Nevada Voter Guide.

Reporters Mike Lee, Kristi Swartz, Miranda Willson, Christa Marshall and Arianna Skibell contributed.