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About Commodity Insights
17 Nov 2022 | 21:27 UTC
By Maya Weber
Highlights
Slim margins add hurdles for legislation
FERC, EPA, Interior are likely oversight targets
Republicans have narrowly regained control of the US House of Representatives, portending robust oversight of Biden administration energy regulators in the next congressional session.
But a razor-thin majority could complicate efforts to pass legislation affecting the energy sector, amid divisions within the Republican Party and challenges bringing progressive Democrats on board. The outcome leaves Washington with divided government, after Democrats narrowly kept control of the Senate earlier in the week.
Leading up the elections, House Republicans were expecting to showcase policies favoring domestic energy and mineral production ahead of the 2024 presidential election, should they take the chamber.
Late Nov. 16, the Associated Press declared incumbent Representative Mike Garcia the victor in California's 27th District, giving Republicans the 218 seats needed to control the chamber in the next Congress. Perhaps appropriate for this surprising election cycle, in the deciding race the Republican Garcia won in a heavily Democratic district.
As of Nov. 17 morning, Democrats had locked down just 211 seats, with six races still too close to call.
Click here for the full-size infographic
Republicans are expected to make their case for rebalancing the US energy portfolio, with more attention on growing domestic oil and natural gas production as part of an "all of the above" energy policy.
An early push is expected on energy legislation setting out Republican priorities, including provisions meant speed energy infrastructure permitting and enable oil and gas production on federal lands. Any far-reaching measures, will likely need bipartisan support to advance, however, given the slim House margins, Democratic control of the Senate, and 60 votes needed in the Senate to overcome a presidential veto.
"It all depends on what the objective is in the House," said Christi Tezak, managing director of ClearView Energy Partners, reflecting on the prospects for advancing significant energy legislation, in a Nov. 17 interview. "If the objective in the House is [to] do nothing but message for two years, then there will be nothing. [U]nfortunately there's a reasonable probability of a preference to message for the next election, versus do something to burn capital that you have to share credit for."
The Federal Energy Regulatory Commission is a likely target of probes under a Republican-controlled House, as are the Interior Department and the Environmental Protection Agency, at a time when the Biden administration may race to complete regulations limiting energy sector emissions.
House Energy and Commerce Committee Ranking Member Cathy McMorris Rodgers, Republican-Washington, has already vowed "vigorous oversight" over the DOE's loan programs, which Democrats recently expanded.
Democratic energy policy achievements, including major climate and energy provisions packaged into the landmark Inflation Reduction Act enacted in August, could also face a bumpier time securing appropriations needed to smooth implementation in the next Congress.
But Democratic control of the Senate helps protect Biden administration climate initiatives.