Hilton Ratcliffe




This calculation, known as the Social Cost of Carbon (SCC), serves as the linchpin for much of the climate-related rules imposed by the White House over the past eight years. From capping the carbon emissions of power plants to cutting down on the amount of electricity used by the digital clock on a microwave, the SCC has given the Obama administration the legal justification to argue that the benefits these rules provide to society outweigh the costs they impose on industry. It turns out that the same calculation used to justify so much of Obama’s climate agenda could be used by President-elect Donald Trump to undo a significant portion of it. As Trump nominates people who favor fossil fuels and oppose climate regulation to top positions in his cabinet, he already appears to be focusing on the SCC. —Bloomberg, 15 December 2016

December 12, 2016Catherine Rolfe

The First Word Energy team draws on Bloomberg’s worldwide resources to cover all aspects of energy policy. Learn how Bloomberg Government can help your energy lobbying or policy analysis—contact Peter Hsu at yhsu24@bloomberg.net or 202-416-3035.

If this all holds, the oil business is going to be well represented in the administration of President-elect Donald Trump. Exxon’s Rex Tillerson at State. Texas’ Rick Perry at Energy. Oklahoma’s Scott Pruitt at the EPA.

Each of these candidates has deep, long-lasting ties to the industry. Each can rattle off the benefits of the U.S. production boom without a moments delay. And each is going to bring that bone-deep understanding to their job. What exactly that will mean for policy, will not always be straightforward. We discuss one aspect below in a section about the always entertaining Social Cost of Carbon.

But here’s one other thing to think about:

Much is being made in the initial news stories about Tillerson’s ties to Russia. But, Tillerson is also an evangelist for fracking, horizontal drilling and U.S. production. And the U.S. fracking boom is not something beloved in Russia; Russian media has invested a lot of time investigating problems blamed on fracking. Low prices brought about by the U.S. shale gale is bad news for Moscow — and this talk at the Council on Foreign Relations in 2012 shows that Tillerson has a nuanced view of the foreign policy impacts of the U.S. production boom.

For more on how success in Russia helped make Tillerson’s career, see Joe Carroll’s story.


Former Texas Gov. Rick Perry is Trump’s top choice to head the Energy Department, Jennifer Jacobs and Jennifer Dlouhy reported. Two Democratic senators from energy-producing states — Heidi Heitkamp of North Dakota and Joe Manchin of West Virginia — are also in the mix, along with Ray Washburne, a Dallas investor and former chairman of the Republican National Committee, according to people familiar with his decision making. (Heitkamp also in the mix for Agriculture. Ahem.)

Jay Martin Cohen, a retired Rear Admiral of the U.S. Navy, is said to be Trump’s choice for under secretary for nuclear security, a position within the Energy Department.


As one of the top Republicans in the House, Cathy McMorris Rodgers, voted to open the Arctic National Wildlife Refuge to oil drilling, and supported efforts to expand offshore drilling. Now, as Trump’s likely choice to head the Interior Department, McMorris Rodgers would be in charge of those issues which are crucial to the oil and gas industry.

Under the Obama administration, the Interior Department has sought to further block the prospect of oil and gas drilling in ANWR, by making all of ANWR a wilderness area, a move that automatically classifies the land as a wildness study area and thereby off limits to oil and gas exploration. By some estimates ANWR contains nearly 15 billion barrels of economically recoverable oil.

The Trump administration could likely undo that, but undoing a ban on drilling there would take an act of Congress. Congress is gearing up to do just that, Alaska Rep. Don Young said in an interview earlier this month. “It’s a number one priority,” he said.

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