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Senate Republican Committee Leaders Expected to Push for Energy Exports

One day after Republicans won control of the U.S. Senate in the 2014 midterm elections, with analysts and officials from various industries and environmental groups making a wide spectrum of predictions for the next two years, there was one area of agreement -- the battles over the nation's energy policies are going to fundamentally change.

As of Wednesday afternoon, the GOP had won new Senate seats in Arkansas, Colorado, Iowa, Montana, North Carolina, South Dakota and West Virginia, and held a 52-45 majority. The margin could grow larger, as it was too early to call Alaska's Senate race, and Sen. Mary Landrieu (D-LA) has been forced into a Dec. 6 runoff.

Sen. Mitch McConnell (R-KY), presumably the majority leader when the new Congress takes office next year, Sen. James Inhofe (R-OK), potentially chairman of the Senate Committee on Environment and Public Works, and Sen. Lisa Murkowski, R-AK, in line to head the Senate Energy and Natural Resources Committee, are expected to change the tempo of the energy legislation debate, although possibly not its eventual outcome.

There likely will be an attempt to stop the progression of the U.S. Environmental Protection Agency's (EPA) Clean Power Plan (CPP) to cut carbon emissions by up to 30% by 2030, which is severely impacting the coal industry (see Daily GPIJune 2). But that attempt to legislatively stop the EPA rule isn’t expected to prevail.

However, it is expected to be one of the major battles on the Senate floor as the new Republican committee leaders advance House-passed energy legislation, which their Democratic predecessors had kept bottled up in committee, one political observer said. And while Republicans would have enough votes on the floor to pass the bills, they won't have enough to stop a filibuster or override a veto. That would simply lead to more shouting and name-calling unless the leaders are able to craft some compromises.

"The GOP caucus would still be unable to stop a legacy-preserving presidential veto on party lines," ClearView's Kevin Book, F. Chase Hutto III, Christine Tezak, Timothy Cheung and Timothy Fox said Wednesday. "We continue to expect the EPA to finalize the CPP next June, probably in a more lenient form than initially proposed."

Republicans will be pushing for more overseas exports of domestically produced crude oil and natural gas in the form of  liquefied natural gas (LNG), and for authorization of  TransCanada Corp.’s controversial Keystone XL pipeline, which is designed to carry heavy oil to Gulf Coast markets. Now that the election is over, the administration, no longer so closely catering to its environmental base, could be more friendly to these types of measures.

While a few LNG export terminals have been approved, "the question facing the Obama administration is whether to finally begin processing the 20-plus pending applications to permit shipping natural gas overseas," Rep. David McKinley (R-WV) said in a column published Wednesday. "Middle Eastern countries are unquestionably paying attention to whether President Obama will allow LNG exports, and reduce their stranglehold on the global energy market. How President Obama deals with LNG will have a profound effect on chartering an energy policy for America's future."

American Petroleum Institute (API) CEO Jack Gerard Wednesday said energy “was a clear winner” in the midterm elections. He pointed to an API poll that found 79% of respondents were concerned about the federal Renewable Fuel Standard (RFS) for auto manufacturers, and 72% supported building Keystone XL.

“If the new Congress is serious about living up to their energy campaign promises, which we expect they are, they should waste no time advancing a pro-energy, pro-growth agenda,” Gerard said. “That includes approving the Keystone XL pipeline, expanding access to domestic oil and natural gas resources, repealing the RFS, and reining in duplicative and unnecessary regulations.”

It remains to be seen what federal regulations governing hydraulic fracturing will emerge from the administration’s regulatory agencies, but again it is unlikely a Republican legislative majority could override new federal rules. There will be trade-offs, however, and the Republican majority could have some influence on the form in which those rules emerge.

Environmental groups said they were disappointed by the election results, but remained vigilant.

"We're not backing down," said Sierra Club Executive Director Michael Brune. "A Congress elected by corporate polluters may think it can force a polluter agenda on this country. But, public support is solidly behind action to tackle the climate crisis."

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