Insights
Energy Transition Motivational Speaking

Lately, I have read countless articles seeking to explain the motives behind why the big oil companies are buying up smaller competitors and why clean energy project cancellations are a failure of government policy to motivate a rapid energy transition. The line on oil companies is that they must be motivated by bullish oil demand[…]

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The People’s Republic of Texas

We have written in the past how the extreme – and opposite – energy policy positions taken by California and Texas have led to severe electric reliability issues in both states.  California taking a “climate-is-all-that-matters” approach and Texas taking a “free-markets-solve-all-problems” approach.  Evidence shows that the best run systems use competitive markets to drive down[…]

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Why Problems With Renewables Have Hurt the Utility Sector

The September sell-off in utilities was due to concerns about profitability of renewable development, not interest rates. Renewable developers (not utilities) are facing cost pressures from supply chain, labor and financing costs. Offshore wind has been hit hardest and the East Coast projects have cost increases of 50% leading to write-offs and cancellations. Onshore wind[…]

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The War on Drugs and Carbon

By now, it’s not controversial to say that fighting a war on illicit drug supply rather than demand has been a failure.  It hasn’t reduced addiction and it has increased crime, violence, incarceration, etc.  Moreover, when the war on supply pushes up the cost to consumers, an alternative appears in the form of prescription opioids.[…]

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Does Anyone Remember the Green New Deal?

The Green New Deal was put forth on Feb 7, 2019, as House Resolution 109. It wasn’t just about clean energy. It was also about environmental justice, income inequality, job creation, access to health care, affordable housing, etc. (www.congress.gov) While it was widely criticized as being too broad and lacking specifics, it was my view[…]

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No Farms, No Food; No Energy, No GDP

As we wrap up 2022 and look forward to 2023, talk of an oncoming recession is all around us.  This would normally be a concerning outlook for the cyclical energy industry, but this energy up-cycle is not driven by strong demand.  It is instead driven by a lack of supply. In the past, geopolitical events[…]

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Revolting Shareholders – More on the Energy Blame Game

To paraphrase Michael Douglas in “The American President” (Universal Pictures, 1995), whatever the voter’s problems, most politicians have no interest in solving them. They have interest in two things and two things only; making them afraid of it and telling them who’s to blame for it…. that folks, is how you win elections. It’s a[…]

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European Energy Policy Oxymoron: Free Market Regulation

The European energy crisis has been a harsh lesson in Economics 101: commodity prices are set by the highest cost producers. Since natural gas is now the highest cost way of producing electricity, the electricity price has more than quintupled because the natural gas price has more than quintupled [source: Bloomberg]. Some articles have described[…]

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Inflation Reduction Act is Really the Energy Expansion Act

Energy Income Parnters (EIP) and Arbo joined up to give context to the Energy Provisions in the Inflation Reduction Act (IRA) of 2022, signed by President Biden on August 16.  This act incorporates many of the prior “Build Back Better” or BBB energy and climate provisions, but slightly less than half of those are simply[…]

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Choosing a Tax on Share Buybacks Over Carried Interest Slows the Energy Transition

In the final negotiations over how to pay for the Inflation Reduction Act, Senate leadership chose to nix an increase in taxes on the carried interest earnings of private equity fund general partners in favor of a 1% tax on the value of repurchased shares for publicly traded companies[1]. There are two reasons to scratch[…]

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