A group of veteran Washington observers sifted through the midterm election results to assess what they are likely to mean for government policies affecting the US power sector during a live podcast on November 9.
The panel is Mike Catanzaro, CEO of CGCN Group, a Washinton lobbying shop, and a former special assistant to the president for energy and environmental policy on the White Houe domestic policy staff during the Trump first term, John Gimigliano, principal in charge of federal legislative and regulatory services for KPMG in Washington and a former Republican tax counsel to the House Ways and Means Committee, JC Sandberg, chief policy officer for the American Clean Power Association and former head of global government affairs and policy for GE Renewable Energy, Whitney Stanco, managing director for energy policy at Compass Point Research & Trading, a Washington-based investment bank that also does equity research, and Tom West, a partner with Capitol Tax Partners, a prominent DC lobbying shop, and a former deputy assistant US Treasury secretary for tax policy.
MR. MARTIN: Let me first set the stage. I used a cartoon for talks late last week that was a drawing of two Democratic donkeys sitting on a couch, watching election returns with their hands over their eyes. Democrats were feeling very uneasy about the outcome after suffering PTSD in 2016 and 2024.
The results were a massive pendulum swing from Republicans to the Democrats. As of this morning, the Democrats will control at least 255 seats in the House of Representatives and the Republicans will hold at least 163 with 18 seats still to be decided.
The Senate will be split 54 Democrats to 44 Republicans with two Senate seats undecided. The Democratic Senate candidates are ahead in Mississippi by 2,574 votes with 97% of the votes counted and in Alaska by 637 votes with only 74% of the votes counted. Alaska has complicated ranked voting. If no candidate gets to at least 50%, then the votes of the third- and fourth-place finishers will be reallocated based on preferences those voters expressed on their ballots, complicating the outcome.
The wide margins will make it hard for the progressive wing of the Democratic party to get its way. Roughly 22% of House Democrats will represent districts that President Trump carried in 2024.
Among the newly elected, and in one case re-elected, Senators will be Democrats from North Carolina, South Carolina, Georgia, Texas, Mississippi, Iowa and Kansas: all states that are traditionally more conservative.
The new Congress will be seated on January 3. The old Congress returned to Washington today for a "lame-duck" session with a lot on the agenda that includes passing a spending bill to keep the government open past December 11.
MR. MARTIN: The most important question for the power sector after the midterms is how data centers will be affected. AI and data center buildouts are not only driving demand for electricity, but also driving up power sector costs by competing for electrical equipment, capital, and construction workers.
Mike Catanzaro, what action do you expect from Congress on AI and data centers?
MR. CATANZARO: If people think that Congress will put data centers down the priority list, they really have not been paying attention. Just to recount the numbers quickly, 76% of voters told exit pollers that they oppose data centers being sited in their communities, and 56% said AI data centers were a crucial or major factor in how they voted. Forty-seven ballot measures about data centers were up for votes in 10 states, and 46 of the 47 passed with restrictive outcomes.
I have never seen anything like this in my 25-year career handling energy and environment issues in Washington. I have never seen an issue take off the way this one has with the trajectory and level of bipartisan opposition that you see leveled against data centers.
There will be a cloture vote at 5:30 this evening on a motion to proceed to debate on a bipartisan permitting bill in the Senate. The Senate bill includes measures directed at data centers. It would add a new section to the Federal Power Act that would require new large computational loads to bear the costs of grid improvements required to support them. Originally, it was large computational loads of 20 megawatts or more. Then that 20-megawatt threshold was removed, so that now all computational loads will be affected.
The big issue next year will be oversight. Oversight in a divided government tends to be partisan. With respect to data centers, it will be bipartisan. You are going to see Congress looking into non-disclosure agreements. It will look at the tax breaks that data centers are using to reduce their effective tax rates and at issues around water quality impacts, noise impacts and pollution impacts. After oversight hearings, I think we will see legislation put together late next year perhaps slipping into early 2028.
MR. MARTIN: I was thinking that the federal government is unlikely to impose moratoriums to slow down data center construction, bur rather to focus more on guardrails for AI and export controls, and that any slowdowns on new construction will come from newly-elected Democratic governors in places like Ohio, Georgia and Texas. Is that how you see it?
MR. CATANZARO: With respect to moratoriums, yes. You are only going to see those at the state and local levels. The election in Texas, for a number of reasons, was hugely significant. Texas accounts for approximately one quarter of planned US data center capacity expected online by 2030.
The oversight effort in Congress and the negative publicity coming out of that could filter down to the state and local levels. I do not think we are going to see legislation at the federal level to impose moratoriums on data center construction, but the oversight will make the job harder at the state and local levels for those who want to see data centers built.
MR. WEST: I agree. The data center debate bleeds into public antipathy toward AI. The votes on data center ballot questions were an opportunity for those who fear the potential effects of AI to register their concerns about potential job losses and the 5% to 10% chance that AI kills us all.
MS. STANCO: Probably more important to the pace of data center development in 2027 will be what happens in state legislatures across the country. Most state legislatures meet from January to June. That is when you will see some of them start putting up guardrails. The guardrails may be around retail interconnection or bring-your-own-power or water or noise or taking away tax incentives. We should have a better sense of the level of data center blowback in the first half of next year.
Whatever those state legislatures do will then go to the local public utility commissions and the local departments of environmental protection. They then have to put out regulations.
We are going to build more data centers in the United States and it will be rising curve, but the slope may be a little more gentle than what people were thinking at the beginning of this year. Next year could be a period of regulatory friction, not just at the federal level, but also at the state level.
MR. MARTIN: Most people realize we need data centers. It is a question of how large they are, where they are built and what guardrails are put around them. Mike Catanzaro said 46 of the 47 data center ballot questions passed. The one that failed was in a small town in North Dakota where voters rejected an additional level of local review for projects. Are there are any other views on what the midterm results mean for data centers?
MR. GIMIGLIANO: It may feel good to take away tax benefits from data centers. I get that, and with the Democratic Congress, they may be inclined to do so. However, the context will matter significantly for what gets done. What will Congress use the revenue to pay for and will it go into a bill that President Trump will sign? Things do not happen in a vacuum.
MR. MARTIN: Let's move to permitting. The Senate will vote at 5:30 today on whether to launch debate on a massive permitting bill that will make it easier to build infrastructure projects. Whitney Stanco, what are the two or three most important things in the bill? Mike Catanzaro mentioned one provision affecting data centers. What else?
MS. STANCO: The bill is a panoply of items that should lead to faster permitting and less risk of judicial or political overturn after a permit is issued. The bill does that through a variety of tweaks to the National Environmental Policy Act, the Clean Water Act and the National Historic Preservation Act. It adjusts the dial on those statutes to make them less severe headwinds to new development.
It is good for developers of all sorts of infrastructure, from oil and gas and pipelines to utility-scale wind and solar projects, geothermal, nuclear, you name it. My financial services colleague told me today that the home builders came out in favor of the bill.
The second major thing that it does is to create a new paradigm for construction of new transmission lines in the US. It puts some real teeth behind a federal backstop siting authority and creates beneficial pathways for advanced grid technologies and inter-regional planning.
It basically takes the whole transmission question a step forward. The changes may take time to play out fully, but it moves generally in the right direction, not just for grid build-out, but also for wind and solar that rely on long transmission lines.
On data centers, I agree with Mike Catanzaro. The provisions in the bill on the electric-rate-making side are pretty stringent in terms of cost allocation. States can create a less favorable rate class and impose tougher requirements on data centers. This is a break with the past. Typically when we think about utility policymaking, we want to avoid undue discrimination against a class of actors. The bill would create a permission structure to discriminate in some ways against data centers for the benefit of ratepayers more broadly.
The bill is more than 400 pages. There is a lot in it. It includes provisions for distributed energy and a shield against stop-work orders for offshore wind projects.
MR. MARTIN: JC Sandberg, do you expect the bill to pass not only the Senate, but also the House in the lame-duck session? If not, the negotiations will have to start anew in January.
MR. SANDBERG: We have been squarely behind this because we know that permitting reform in its current form will save ratepayers money, and in a time when affordability is paramount, that is important. The transmission provisions are critical to us.
The certainty of permitting is key to whether our members with global reach will invest in the United States. The US was always seen as the place where, despite shifting political winds and the topsy-turvy nature of government policy, if you had a permit, that permit was investable. This package takes a big step toward ensuring that.
I don't want to predict whether the bill makes it not only through the Senate but also the House before year end, but what I can say is we are working really hard to try to make that happen.
MR. MARTIN: The incoming new House speaker, Hakeem Jeffries, said over the weekend that the House will not take up the permitting bill in its current form. That may have been a negotiating position. Whitney Stanco, what odds are you putting on the permitting bill getting through both the Senate and House before year end?
MS. STANCO: We raised our odds today to about 45%. We saw a lot of things happen over the weekend that made us more optimistic about the prospects. The odds will be affected by the size of the cloture vote this evening in the Senate to launch debate. What does the Senate amendment process look like? Will Republicans have attendance problems in the House with so many members leaving Congress? This bill has a way to go, but as of today, I am feeling a bit more optimistic.
MR. MARTIN: Let's move to another topic. John Gimigliano, the One Big Beautiful Bill Act last year set a deadline of July 4, 2026 to start construction of remaining solar and wind projects to qualify for federal tax credits. Will Congress extend the deadline, and if so, when and for how long?
MR. GIMIGLIANO: If you listen to what Democratic leaders said both before and since the election, it's clear that there is a desire to do that. We have heard it from the incoming chairman of the Senate Finance Committee, Ron Wyden. We have heard it from the Senate Democratic leader, Chuck Schumer. We have heard it from their counterparts in the House. The desire is there. The questions are the path and timing.
Let's just imagine for a moment an all-Democratic scenario in 2029. We will come back to the next Congress in a second. That 2029 scenario is a pretty clear path if you have a Democratic president, Democratic House and Democratic Senate. I will leave it to others to tell me whether it makes sense at that point to extend the tax credits retroactively or only going forward.
Come back to the next Congress that will take office in January 2027. The question is whether the president would sign any bill with such a tax credit extension. Context matters. Is the extension attached to the debt limit? Is it attached to a budget deal? These are all important questions.
The one thing that I think we all know is that while the president has been mostly indifferent to tax policy, putting aside tips and other things, he has kind of dug himself in on renewable energy policy. While he may agree to a broader bill, it would definitely take a reversal for him to agree to this. Again, context will matter. What else is in the bill that he might want and hold his nose and sign? That is one of the things we will be watching next year.
MR. MARTIN: What do you think he might trade for?
MR. GIMIGLIANO: I think if Democrats go to him and say we would like to extend your legacy on the taxation of tips or Social Security, et cetera, make these items permanent in exchange for this, he would have to think about it.
MR. MARTIN: Tom West, do you agree with John's assessment?
MR. WEST: Yes, I think that's right. The complicating factor is the president is particularly dug in on wind, but he is usually willing to bargain.
MR. MARTIN: JC Sandberg, a tax credit extension for solar and wind is not high on your trade association's wish list at the moment. Do you think that might change once the new Congress takes office?
MR. SANDBERG: A lot of things happened in the midterms that we never thought would happen. We are laser focused for now on getting permitting reform over the finish line. There will be time to take stock of our priority list once we get past the permitting push.
MR. MARTIN: John Gimigliano, coming back to you. There is bipartisan support for extending section 45X tax credits for domestic manufacturing of solar, wind and storage equipment. The credits can be claimed on wind equipment through 2027. They will start to phase out for other manufacturers after 2029. Will Congress extend both dates and, if so, when and for how long?
MR. GIMIGLIANO: Much of what I said earlier about context matters for this as well, although section 45X is on firmer ground with a lot of Republicans, so there is greater potential for a bipartisan deal. There is the potential to bring Republicans along if Democrats are willing to expand the eligible technologies to things that either Senate Republicans would like or the president might like.
MR. MARTIN: What other equipment besides wind, solar and storage do you think Republicans want?
MR. GIMIGLIANO: Oil-and-gas-adjacent technologies. They may be things along the lines of sequestration and that other more Republican allied industries might like.
MR. MARTIN: Tom West, anything to add?
MR. WEST: John is right. There will be interest in expanding to new technologies, but then the question is how much Congress is willing to spend on them.
MR. MARTIN: JC Sandberg, this is on the wish list of the American Clean Power Association. What sort of feedback are you getting from the Hill?
MR. SANDBERG: Section 45X is important to our members. It will be part of a package of things we talk about with the incoming Congress.
MR. MARTIN: Tom West, will tax increases be on the agenda next year and, if so, in what form? The OBBBA front-loaded tax cuts and it backloaded the pay-fors, like spending cuts in Medicaid and the SNAP food program for low-income households. The Democrats want to defer or cancel both cuts. What will take their place?
MR. WEST: This goes to the question on what Democrats want to spend whatever revenue they can generate. I doubt the new Democratic leaders will be interested in launching a public debate about tax increases next year. We will be headed into a 2028 presidential election cycle. That said, they may be open to limited tax increases, such as increased taxes on hyperscalers and data centers. There is some bipartisan support for that.
The president in the past has signaled that he would be willing to address the tax treatment of carried interests in private equity funds. Congress could tinker with the stock buyback tax to raise more revenue. I am not saying any of this would be easy to get through, but those are the kinds of things that I could see being on the table next year.
MR. MARTIN: What about a corporate rate increase?
MR. WEST: No. I don't see the president agreeing to it. The Democrats will not want their members having to take tough votes on big tax increases that the president is not going to sign.
MR. GIMIGLIANO: It would violate one of the iron laws of Capitol Hill not to make members vote for a tax increase that will not become law. Some of the data center taxes might be popular and may have legs. In an all-Democratic scenario in 2029, then yes. If that happens, then it is game on for revisiting the structure of the clean energy tax credits.
MR. WEST: I agree with that. If 2029 is a Democratic trifecta, it will be a very different conversation.
MR. MARTIN: Let me ask about something that is down in the weeds. The 2017 tax bill imposed a base erosion and anti-abuse tax. It's called BEAT. It has the potential to claw back tax credits claimed by large companies with foreign affiliates. The potential claw back of renewable energy credits was capped initially at 20%. But starting with tax credits claimed in 2026, the renewable tax credits are exposed to a full claw back.
Do you see the 20% cap being extended beyond the current expiration date of the end of 2025? This affects not only tax equity investors, but also tax credit buyers. However, it applies only to a small number of large corporations.
MR. GIMIGLIANO: You are right about it being a weedy question. I could see this being revisited if Democrats decide the country really needs to rethink its approach to the international tax provisions in the wake of the One Big Beautiful Bill Act. They may decide it is time to revisit Pillar Two, GILTI -- now called NCTI -- FDII and all the other international tax acronyms. If that happens, then I can see BEAT also being revisited.
MR. WEST: I don't think everybody appreciates the critical role that big corporations play in our tax credit ecosystem. I know the folks on this call do, but I think that constituency for this tax benefit is key, and you noted it in the question. They help developers turn tax credits developers cannot use into cash to build projects. BEAT affects a small number of large corporations. Spending revenue for tax relief on that particular constituency at this time seems like a stretch.
MR. GIMIGLIANO: I agree with that. It depends on how it is presented. If you view it as a relief for the renewable sector, it feels better. It comes down to how it is sold.
MR. WEST: People do not appreciate the importance of these buyers in the renewable market.
MR. MARTIN: Will Congress provide more help for nuclear projects and, if so, in what form?
MR. CATANZARO: Possibly. There are two big issues on the agenda for nuclear. One is examining the prospect of establishing some sort of construction-risk-sharing program to address cost overruns. There are some preliminary discussions about that point right now. There is a question whether the administration can do it under the Title 17 loan guarantee program without Congressional authorization.
The other question is whether there should be direct pay for section 48E tax credits for nuclear projects. Utilities are not eligible for direct pay for section 48E tax credits. If there is a deal on energy tax credits next year, the question will be whether this can be part of it. There is overwhelming bipartisan support for nuclear energy. If you go by the last six years, several key statutes dealing with the Nuclear Regulatory Commission and how you permit advanced reactors have all passed overwhelmingly in the House and Senate. It is possible a deal could be crafted around something like that.
MR. WEST: Support has grown for an all-of-the-above approach given the energy demands in this country. Some of the hyperscalers have cut well publicized deals with owners of nuclear power plants to buy electricity. Nuclear has to be part of the solution. I think the president might be more willing to deal on some of the other renewable stuff if there was a nuclear element included.
MR. MARTIN: To clarify one thing, regulated utilities and other privately owned power companies cannot qualify for direct pay. However, municipal utilities and electric cooperatives can.
MR. MARTIN: Mike Catanzaro, do you see any relief in the next Congress for offshore wind?
MR. CATANZARO: If the permitting bill can get passed and signed into law in the lame-duck session, then I'm not sure there would be a need to address anything related to offshore wind. As Whitney eloquently summarized, the bipartisan permitting bill helps just about every energy resource, and offshore wind would certainly be helped.
I don't know whether, from a tax perspective, you could see some movement from the new Congress.
MR. MARTIN: Do you expect more attacks on the existing permits that are held by offshore wind developers?
MR. CATANZARO: There is a side deal in the works now where the administration is approving projects that were stuck in the approval queue at the Pentagon and the Federal Aviation Administration. Those approvals are dribbling out as we speak.
The permitting bill looks at categories of projects. There is a title on so-called project certainty. If you find evidence that the administration or particular agencies are discriminating against a class or category of projects, you can ask a court to issue an injunction. Discrimination is measured against a five-year baseline.
The bill does not say that an administration must approve every permit. It is possible you could see maybe this or a future administration rejecting individual projects on the merits. It would have to deal with the Administrative Procedure Act, engage in reasoned decision making, and look at the underlying statutes that govern those permits.
As for continuing attacks on existing wind permits, I expect the administration to implement the permitting bill in good faith in the spirit in which this compromise was struck.
MR. SANDBERG: One of the big things this bill has the potential to do is to return the power largely to the states to decide how they want to maximize their natural resources. Wind and solar are a part of that mix. The certainty and the disparate treatment provisions are important, but really at the end of the day, what this does is give the states the opportunity to decide what they want, be it nuclear, wind, including offshore wind in the Northeast, geothermal, nuclear or other sources. You name it, if you want to develop it, if you have the resource, this bill takes a step toward giving the states the ability to do that.
To the extent they need federal permitting after they make that decision, the bill helps the permits get through the federal machinery more quickly, but with all the necessary reviews and other things that we would expect from government protecting our natural resources and the citizens of this country. The bill is a huge step toward being able to choose an all-of-the-above approach at a state level for energy.
MR. MARTIN: What about the logjam on federal approvals for wind and solar projects that have touch points with the federal government? Mike Catanzaro mentioned this. The Pentagon has started granting approvals under pressure from a federal district court in Oregon, but at a glacial pace. Do you see the pace picking up and, if so, how much?
MR. SANDBERG: There has been a start. Ten were released Friday into Saturday. It looks like another 10 will come today if they haven't already.
I think that is a show of good faith. The government has acknowledged there are more than 300 wind projects before the Department of Defense waiting for some determination, either of no risk to aviation or, if there is a presumed risk, to go through the mitigation process. We need more progress on the solar side.
MR. WEST: We are already on the clock for the 2028 elections. While we all know that getting these projects started now is not a solution for electricity prices tomorrow, I think Republicans want to be seen as not slowing down jobs and projects. A lot of these projects are in red states and red districts. The midterms gave an incentive to speed up this process.
MR. MARTIN: JC Sandberg, how do you expect Congress to engage on tariffs?
MR. SANDBERG: Early and often, we hope. There are some reforms that can be done to how tariffs are imposed and that do not require a complete overhaul of the process. Everyone is for reshoring supply chains in appropriate ways, but some of the steps that have been made of late are not leading to orderly reshoring. We hope some Congressional attention will be paid to how tariffs are affecting markets and look for better ways to promote reshoring.
MR. MARTIN: I have been thinking that one place Congress might engage is on tariffs against Canada, and the other is there has been talk about shining a light on how tariff exemptions have been granted. There have been some suggestions that campaign contributions smooth that process. That said, Democrats are not necessarily anti-tariff. They support rebuilding the manufacturing base as much as President Trump does. Does anyone want to push back on that view? [Silence.]
Mike Catanzaro, will Congress use the Congressional Review Act to prevent any further erosion in environmental regulation? I think you would probably use a different word than erosion.
MR. CATANZARO: The CRA gives Congress the power to rescind federal regulations with a certain number of days after issuance. The period is 60 session days in the Senate and 60 legislative days in the House. The new Congress could reach as far back in theory as September. However, the president can veto any such rescission. Having said that, sometimes Congress uses the Congressional Review Act to force the other party to take tough votes.
It would be surprising if a Democratic Congress does not try to take votes on EPA's greenhouse gas regime. However, unless there are two thirds of the members in each house prepared to override a presidential veto, the vote will not have any legal effect. Those rules will take effect and be litigated. Their fate will be decided ultimately by the courts.
MR. MARTIN: Let's talk about the general tone in Washington. There seem three possible paths for President Trump and Congress.
One is Trump becomes so angry about congressional investigations that he becomes more authoritarian, meaning he ignores Congress and the courts. Another is Trump the deal maker emerges and the parties find a way to work together on infrastructure improvements, AI guardrails, restoring the US manufacturing base and China. The last is the Democrats are unable to coalesce around proposals to present to Trump. Like the Republicans, they have multiple factions.
Whitney Stanco, which do you think is the most likely outcome or do you see an altogether different scenario?
MS. STANCO: I think you got it right. I view it as a teeter-totter. President Trump is such a mercurial figure that things will teeter-totter any given day between the different options.
We have an example this week. He promoted Stephen Miller to be chief of staff a few hours after telling an interviewer on 60 Minutes that maybe he went too far on immigration. He is someone who is able to change his mind on any given day. I think there will be days when anger is the predominant tone and then there will be days where horse trading is possible.
The burden on folks who want to get horse trades done to be really precise about what they want to get done and focus on the windows of opportunity on a debt ceiling bill or a piece of appropriations that is a must-pass bill. The size of the Democratic majority makes me less worried than I otherwise would have been about factionalization within the Democratic party.
MR. MARTIN: JC Sandberg, one listener asked how specifically can Congress affect change on tariffs. Do you want to tackle that?
MR. SANDBERG: There are some reforms possible in the 232 space, which we have seen used recently as a basis for tariffs on polysilicon and downstream solar products. Section 232 is also expected to be invoked to impose tariffs on wind turbines and turbine components. There may be some room for Congress to find common ground on appropriate uses of 232 tariffs.
MR. MARTIN: Section 232 refers to tariffs imposed on national security grounds.
There are a lot of audience questions about FEOC. FEOC stands for "foreign entity of concern." It is a set of hoops that must be jumped through to claim federal tax credits on renewable energy projects. FEOC is an effort by the Republican Congress to rid the renewable sector in the US of Chinese equipment, intellectual property, equity, debt and participation in management. Does anyone expect the next Congress to tinker with the FIOC rules?
MR. WEST: I could see some tinkering, but it is going to be really hard for Democrats to pull back on the FEOC provisions as a whole. They are perceived as keeping China out of US supply chains. Congress could turn the dial on some of the percentages and perhaps tweak the debt and equity rules that have been so difficult to get our heads around since the OBBBA was enacted. I don't see it going beyond that.
MR. SANDBERG: The fundamental concept is one that I think both parties support. There are some things that could be fine tuned to make the rules more workable. There are a couple spots where I think some minor legislative tweaks would help clarify things that are going to be hard to clarify in guidance.
MR. MARTIN: Listeners have a lot of questions about the bulk power system order that President Trump issued on August 26. It is a ban primarily on Chinese equipment that might be used to harm the US power grid. The ban will not take effect until the Department of Energy issues guidance. The DOE has been given a deadline of Christmas Eve, but many people expect that guidance to slip. JC Sandberg, what is the latest on the bulk-power system order?
MR. SANDBERG: The Department of Energy received 181 comment letters. There are now ex parte discussions going on with DOE both within our industry and also with the broader utility sector to drill down into what this looks like. The last attempted bulk-power system order in May 2020 was written broadly, but implementation was much more narrow. I think this is headed in the same direction. We are advocating for a targeted risk-based approach, for clear administrable boundaries and for reasonable transition periods.
There are other like-minded trade associations advocating for the same things in those ex parte conversations between now and Christmas. It remains to be seen whether anything actually gets out the door by December 24. DOE is still working toward that goal.
MR. MARTIN: There have been a number of questions about section 25D tax credits for homeowners who install rooftop solar systems. Does anyone see that making a comeback?
MR. GIMIGLIANO: Why not? If we are opening up all renewables policy to what is possible, I am sure conversations will be had. The question is whether there is any point if Trump won't sign it. Maybe there is a point in proposing it, but actually moving it through Congress with offsets might have to wait for 2029 if 2028 breaks correctly for Democrats.
MR. MARTIN: A number of people have asked about oil and gas. For example, one listener asks, "How might the new administration policies affect the LNG and gas-fired power generation sectors?"
MR. CATANZARO: I think 89% of midterm voters said that affordability and cost of living were most important to them. What they were saying in subtext was they do not like paying more for energy. If you look back at 10 or 15 years of Democratic policy on energy, a lot of it was designed to make fossil fuels more expensive in order to create competitive space for renewables. A lot of those policies were cast aside when they decided to move in a different direction and pass the Inflation Reduction Act with tax credits for renewable energy.
Will Congress be talking next year about a return to something like a windfall profits tax on oil producers and refiners? I would be surprised.
LNG is a bit of a different case. You have had a faction within the manufacturing community that has never liked LNG exports, has been trying to make the case vociferously and diligently now for a decade that LNG exports are the cause of natural gas prices going up or showing projections that they will go up over time. Those predictions have proven wrong.
That group might have more traction with a new Democratic Congress that has never been a big fan of LNG exports and that is sympathetic to domestic manufacturers.
MR. MARTIN: Here is an interesting Washington-type question from an audience member. Does the panel expect any changes in heads or senior members of agencies that might affect the power sector?
MS. STANCO: Nothing specific, but it is important to keep in mind that we are talking about between 54 and 56 Democratic Senators. That will make it challenging for the president to get new agency picks confirmed who are too partisan or unqualified. It will have a moderating influence on future nominees.
MR. MARTIN: Of course, the president can resort to having people occupy roles on a temporary basis to avoid the need for Senate confirmation. We have seen a lot of that during the last year and 10 months, even with a Republican Senate.