Industry lobbyist mum on possible exports-for-renewables deal

Source: Geof Koss, E&E reporter • Posted: Wednesday, October 14, 2015

The head of the American Petroleum Institute today repeatedly declined to offer an opinion as to whether the group would support a legislative compromise to lift the crude oil export ban in exchange for extending key renewable energy tax incentives.

API President and CEO Jack Gerard told reporters he was “heartened” by Senate Minority Leader Harry Reid’s August comments that the Nevada Democrat was open to talks of lifting the ban if more tax credits for renewables are on the table (Greenwire, Aug. 25).

Reid’s comments echoed a sentiment expressed by other Senate Democrats, who have argued that a boost for the oil sector should include help for renewables.

“You’ve heard about a half dozen more who’ve said, ‘Hey, I’m open to this, but I’d like to look at this issue.’ Or ‘I’d like to look at this issue,'” Gerard said on a conference call. “Very few other issues have as much momentum as this one does.”

But after citing Reid’s comments, Gerard deflected repeated questions over whether the industry could get behind an agreement built on the top Senate Democrat’s suggestion of linking crude oil exports to renewable energy tax breaks.

“I think there’s a variety of options out there,” Gerard said. “We could probably identify 20 to 30 paths to success here. I do think it is significant that you’re hearing more and more say we could work something out here. People see that momentum.”

Pressed further, Gerard sought to pass the buck to congressional leaders, while arguing that a change in exports policy should be based on the merits.

“I think we’re in the early stages of what will somebody do, what will somebody offer? We’re not really focused on that right now,” he said. “We’ll leave that to the leadership. Our focus is this is good for the American people, it’s good for the American economy, it’s good for American consumers. We’re for it, and we’re going to continue to advocate for it.”

Gerard’s hesitation on the question highlights the intense political pressure that an exports-for-renewables deal entails, given that Democrats would likely target the billions in dollars in tax breaks the oil and gas industry enjoys as a way to pay for extending the production tax credit, the investment tax credit or both.

Asked again about a possible deal, Gerard reiterated comments he made Friday after the House easily passed legislation lifting the ban, when he criticized suggestions that Congress impose new taxes on the industry in exchange for greenlighting exports (Greenwire, Oct. 12).

“Let me tell you what we strongly oppose,” he said. “There have been some who have suggested we need to go back and put a tax on the domestic oil and gas industry. That’s one of the sillier proposals I’ve heard. Why would you go and raise the cost to the American consumer, to the American producer, to make them noncompetitive in exchange for the ability to be competitive by going into the global marketplace?”

After declining to provide the “yes or no” answer one reporter demanded to a “straightforward” question about a deal, Gerard indicated the industry’s preference for a simple legislative repeal.

“The cleanest, clearest path to success is just a straight up-and-down bill that says lift the ban on crude oil exports in the United States,” he said.

But Gerard paused when pressed on whether there’s enough Democratic votes to move such a bill through the Senate.

“Again the process will determine that, but I think there’s strong Democratic support for lifting the ban on crude oil exports,” he said.

Nonetheless, Gerard predicted that a repeal will happen before the end of the year, citing a number of must-pass bills as potential vehicles.

“It’s our expectation that the crude export ban will be lifted this year,” he said.