Newly confirmed Energy Secretary Rick Perry, who has been on the job just eight weeks, explained his marching orders from President Donald Trump: “Do for American energy what you did for Texas.”
Perry explained his job description during a brief onstage interview at the Bloomberg Future of Energy Global Summit on Tuesday in New York. During the event, he talked about the Trump administration’s agenda to remove restrictions on the coal industry and to approve new facilities to export more gas to other countries.
Perry also said he doesn’t plan to suggest to President Trump that the U.S. should walk away from the Paris climate deal, but rather that the U.S. should “renegotiate it.”
Perry’s softer stance on the Paris Agreement -- an international agreement that the U.S. signed in late 2015 -- puts him on one side of a publicized divide within the Trump administration.
On coal and removing restrictions
Perry’s clearest position was on promoting the coal industry and ending the Obama administration’s environmental regulations for fossil fuel extraction.
“Our predecessor led a war on coal that we’re working to unravel today,” said Perry, referring to President Obama. President Trump and his team have widely touted this message throughout both the presidential campaign and their first 100 days in office.
“The last eight years saw policymaking driven by political agendas. The previous leader said that they were for American energy independence and domestic energy development; they just didn’t want to drill for it, mine it, transport it or sell it. Exploration on federal lands and waters decreased, permits for vital projects...were left to wither on the vine. Those days are over.”
Experts, utility experts and even mining companies agree that the Trump administration’s deregulation policies will not revive the coal industry.
In a speech this morning, Bloomberg New Energy Finance founder Michael Liebreich said that coal is being replaced mostly by low-cost natural gas, but also by low-cost clean energy and energy efficiency. Coal losses are being driven by changing market economics and low price competition, not by regulation. Many coal jobs have also been lost to increasing automation, noted Liebreich.
A report out this week from Columbia University’s Center on Global Energy Policy found that 49 percent of the decline in coal generation came from competition with cheap natural gas. Another 26 percent came from efficiency measures, and 18 percent has been due to low-cost clean energy. The remaining much smaller percentage is due to environmental regulations, the report found.
However, during Perry’s talk, he emphasized environmental regulations. “I recognize that markets have a role in the evolution of our energy mix," he said. "But no reasonable person can deny the thumb, and in some cases the whole hand, has been put on the scale to favor certain political outcomes.”
On natural gas
Perry also announced that the Department of Energy signed an order authorizing the gas company Golden Pass to build a liquefied natural gas export facility in east Texas. That facility will create 45,000 jobs during construction, and “position our nation as the dominant exporter of liquefied natural gas,” said Perry.
Perry said that there may be additional LNG export announcements in the future. Golden Pass is jointly owned by Qatar Petroleum and Exxon.
The U.S. started exporting liquefied natural gas to other countries in recent years due to an abundance of domestically produced gas. The Department of Energy approved a handful of facilities in mid-2015. Previously, the department held off approvals of export facilities over concerns about the environment, and worries about fluctuations in U.S. supply and higher prices.
On energy R&D and tech
Perry’s stances on other issues, like energy research and development, were less clear. While Perry has been publicly supportive of the Department of Energy’s ARPA-E program, which gives grants to high-risk energy programs, the Trump administration has proposed a budget that eliminates ARPA-E.
Perry said federal-sponsored research and development for energy has been important, pointing to how government-supported tech unleashed hydraulic fracking. He also praised national labs and the scientists and engineers at the Department of Energy.
But during the interview portion of Perry’s talk, Perry avoided the question of preserving federally funded energy research and development -- and specifically ARPA-E -- in the face of Trump’s proposed budget cuts. He didn't reveal much about what his budget priorities would be (though he did cite cybersecurity and supercomputing).
Perry’s mentions of clean energy were sparse, despite the fact that Texas became the largest provider of wind energy in the U.S. under his watch as governor. But he did say he plans to “help renewable energy make its way to the grid,” including solar, wind and hydro power.
He also mentioned that he had visited a carbon-capture plant in Houston. “I happen to think that is a good thing. It’s what Americans desire,” said Perry of the new technology.
On Paris
Perry avoided discussing climate change. Previously Perry has said climate change is “contrived” -- but has more recently softened that stance. He did reference how his work as governor of Texas lowered carbon emissions in the state.
During the interview, Perry revealed more of his thoughts on the Paris climate deal.
Trump previously said he planned to “rip up” the Paris Agreement. But some of his close advisers are now reportedly urging the president to stay in the Paris deal. Perry appears to fall into this camp.
“I’m not going to say, 'I’m going to tell the President of the United States to walk away from the Paris accord.' But what I’m going to say is we probably need to renegotiate it. We need to sit down. They need to get serious about it," he said.
“They” appears to refer mostly to members of the European Union, like Germany and France.
Perry lamented Germany's closure of nuclear plants, which has caused the country to burn more coal: “Don’t sign an agreement and then expect us to stay in an agreement if you’re not going to really participate and be a part of it...it’s about words versus actions.” (Germany has long been the world leader in renewable energy development -- although its stance on nuclear has been controversial.)
Perry recently returned from the G7 Summit, where he said there was a lot of “cheerleading for the Paris accord.”
He finished by explaining an insight from his short time in office: “Being the Secretary of Energy is real different than being the governor of Texas.”