It’s official, a new president has entered the White House. President Biden took his first few days in office to send a strong message to the country—he’s nothing like his predecessor.
Unlike Trump, Joe Biden is very aware of the dangers of climate change, that’s probably the reason why some of his first executive orders were to rejoin the Paris Climate Agreement and to stop the construction of the Keystone pipeline, a bold move against the Oil industry.
During his campaign, Biden made it clear he would work towards leading the country into a more sustainable future. His environmental agenda is centered around one goal: to transition away from the fossil fuel industry. Back in July, he announced an ambitious $2 trillion plan to promote electric vehicles, energy efficiency, and other policies intended to address climate change. This has oil industry moguls and prominent figures nervous, yet not completely in panic.
“There is a lot of room in there for oil and gas,” said Matt Gallagher, president of Parsley Energy, a West Texas oil producer, regarding the Biden plan.
“The reason oil and gas producers remain in business today, to the great consternation of people who wish it didn’t, is very simple: There is a demand for that product,” declared Karr Ingham, a consulting petroleum economist for the Texas Alliance of Energy Producers. Biden has mentioned in the past that the transition away from fossil fuels is not likely to happen at least until 2050.
Environment plans and policy changes are of great importance for Texas. We produce around 41% of the nation’s crude oil output and approximately 25% of natural gas, a significantly larger share than any other state in the country. Texas’ economy is dependent on numerous industries, and oil and gas comprise between 30% and 35% of the gross state product, an estimate based on direct and indirect impacts.
The laws that might develop in the next couple of years concerning the oil and gas industry will definitely have an impact on the state’s economy, and particularly in small businesses rather than on big, well-established companies.
Frank Maisano, Bracewell Policy Resolution Group Senior Principal showed concern for Texas small businesses in the industry, “… this oil and gas industry, if you think about the BPs and the Exxons of the world, is much different from what Texas knows as the oil and gas industry,” said Maisano. “The oil and gas industry in Texas is certainly these big energy players that are based in Houston and have refineries, but at the same time it is thousands and thousands of small business-supply chain businesses, wildcatters, and guys who are running around West Texas producing oil.”
Harsh regulations are likely to raises expenses and make some companies go bankrupt if they don’t come up with innovative solutions to comply with new rules. Small business owners will likely be pushed to find creative ways to keep working or find themselves out of business.
Perhaps this might be a good time for Texans to dive into the clean energy industry.