What role is energy playing in the contest between incumbent U.S. President Barack Obama and Republican challenger Mitt Romney? The short answer: Surprisingly little, considering that U.S. gasoline prices are roughly a dollar higher than when Obama was elected and about as high as they have been any time in the last four years.
Energy industry donations to the two candidates are not among the highest tech sector contributions, as noted in the current issue of IEEE Spectrum. Ads promoting fossil energy exploitation are up rather sharply compared to 2008, to be sure, but clean energy campaign spending is dramatically lower.
Despite controversy surrounding U.S. government subsidies for wind and solar companies like the failed Solyndra, Obama appears to have largely lost the active support of the clean-tech industry, while Romney has the enthusiastic backing of coal, oil, and natural gas interests. Why is that, and how much difference might it make?
A sharp decline in natural gas prices, which makes both electricity and home heating considerably cheaper, presumably is helping Obama and to some extent compensating for high gasoline prices. Gas prices today are half what they were in November 2008 and a quarter of what they were at their high, five months before that. The historically low prices have encouraged utilities to switch electricity generation feedstocks, from high-carbon coal to relatively low-carbon natural gas, lowering U.S. greenhouse gas emissions from what they otherwise might have been.
That ought to help Obama with environmentalists and clean-tech proponents, but evidently it has not: The president's explicit support for natural gas and his general "all of the above" approach to energy evidently weighs more heavily in their minds than actual results. Something of the same might be said of what I have called the president's "stealth" approach to greenhouse gas reduction by means of tighter clean-air regulation and much stiffer automotive fuel efficiency standards. Evidently it is a bit too stealthy: Environmentalists and the clean-tech industry would much prefer to see him speaking out in favor of a cap-and-trade reduction scheme or an outright carbon tax.
Romney, of course, is unabashedly in favor of the most aggressive development of domestic U.S. fossil fuel resources, and has been sharply critical of federal government regulations impeding greater exploitation of coal, oil, and gas. “The United States is blessed with a cornucopia of carbon-based energy resources,” declares Romney's energy website. The head of Romney's energy advisory team is the Oklahoma billionaire Harold Hamm [photo, top left], the founder, chairman, and CEO of Continental Resources, which boasts of being the largest lease-holder in the Bakken shale oil formation in the northern Great Plains.
Obama has his friends in the industry too—notably Jim Rogers [photo, bottom left], CEO of Progress Energy in North Carolina, who was co-host of the Democratic convention in Charlotte, right in Mr. Rogers's neighborhood. Though he has made his career running large coal-burning electricity companies, Rogers is also a long-time advocate of federal carbon regulation. Another close Obama confidant, coincidentally, is John W. Rogers Jr [photo, right], making this actually a tale of two Mr. Rogers. John Rogers, the son of one of the famed Tuskeegee airmen, has a successful Chicago investment firm and serves a director on the board of Illinois-based Exelon, one of the nation's two leading owner-operators of nuclear power plants.
As a company heavily invested in nuclear, Exelon stands to benefit from policies discouraging the burning of coal. (Referring to that blunt fact, Exelon's former chairman once characterized his company as "the hyena looking for the dead stuff on the road.") According to a New York Times report, Exelon's ties to Obama and his administration may have helped the nuclear industry get favorable findings on water intake rules for atomic power plants and, post-Fukushima, the safety of spent fuel cooling ponds.
Let it be noted that access of that kind can help with initial determinations but it does not guarantee ultimate success. In the case of spent fuel cooling pond rules, for example, the D.C. Federal Appeals Court has ordered the Nuclear Regulatory Commission to take a much closer look at the issue. Politics and business being what it is in all advanced industrial countries, top politicians always forge ties with corporate leaders who share their general views, and when contentious issues arise, the closest corporate friends of the politicians in office will naturally get the first hearing.