US ELECTIONS: Harris picks climate-friendly Minnesota Gov. Tim Walz as running mate

Democratic presidential candidate Kamala Harris has tapped Minnesota Gov. Tim Walz as her running mate, a choice that could potentially underscore the importance of environmental and climate-friendly policies for the Democratic ticket.

Environmental groups praised the move. "The Harris-Walz ticket is one that understands the fight before us, isn't afraid to tackle climate change head-on, and will continue to build upon the legacy of the Biden-Harris administration," Sierra Club Executive Director Ben Jealous said in a statement.

Indeed, Washington-based research firm ClearView Energy Partners saw Walz's selection as an effort by Harris to reach out to left-leaning Democratic base voters. "Today's decision suggests a focus by the Harris campaign on the climate-forward youth voters who could determine outcomes in closely contested 'swing' states," ClearView said in an Aug. 6 note.

The oil and gas industry reacted to the pick by urging policies to cement US energy leadership at a time of geopolitical instability. "We encourage the Harris-Walz campaign to detail their stance on the key issues that will shape America's energy future, from LNG exports and federal leasing to permitting reform and consumer choice," Mike Sommers, the president and CEO of the American Petroleum Institute, said in a statement.

Walz has served as the governor of Minnesota since 2019. After Democrats gained full control of the Minnesota legislature in January 2023, Walz signed a clean energy law that requires electric utilities to source 100% of their power from carbon-free sources by 2040.

In June, Walz signed legislation to streamline the state energy permitting process, shaving up to a year off the permitting timeline for renewable energy and transmission projects.

Before becoming governor, Walz represented a conservative-leaning district of Minnesota in the US House of Representatives from 2007 to 2019. During that time, he was a member and leader of the bipartisan Energy Working Group and showed a willingness to work across the aisle.

Walz co-sponsored two energy-related bills in the House, but they never became law. A 2014 bill would have facilitated offshore oil and gas leasing, implemented a loan program to reduce greenhouse gases from coal-fired power generation, and extended tax credits for renewables.

Another bill introduced in 2013 would have required refinery owners to report planned outages to the government one year in advance and required the US Energy Secretary to analyze the costs and benefits of creating a national strategic refined petroleum products reserve.

Support from progressives, moderates

The Walz announcement drew support from both progressive and moderate voices in Congress.

Rep. Alexandria Ocasio-Cortez (D-NY) wrote on social media that Harris and Walz "will govern effectively, inclusively, and boldly for the American people."

Sen. Joe Manchin (I-W.Va.), a former Democrat who recently registered as an independent, said in a statement that Walz "will bring normality back to the most chaotic political environment that most of us have ever seen."

"I can think of no one better than Governor Walz to help bring our country closer together and bring balance back to the Democratic Party," said Manchin, chairman of the Senate Committee on Energy and Natural Resources.

In an Aug. 6 statement, the Trump-Vance campaign criticized Walz for "proposing his own carbon-free agenda" and advocating for "stricter emissions standards for gas-powered cars."

Minnesota is one of over a dozen states that have adopted California's tailpipe rules requiring an increasing percentage of zero-emission vehicle sales. However, Minnesota has signaled it has no immediate plans to follow California in banning the sale of new gas-powered vehicles beginning in 2035.

Walz is expected to campaign on the Biden-Harris administration's environmental track record.

Since the Inflation Reduction Act was passed in August 2022, at least 30 clean energy and manufacturing projects have been announced in the swing state of Michigan alone, representing nearly $12 billion in investment and more than 12,000 jobs, according to the business group E2. Projects representing hundreds of millions of dollars have also been announced in Pennsylvania and Wisconsin.

The Harris-Walz campaign "is far more likely to stress clean energy incentives as an example of policies that promote American energy," Scott Segal, co-chair of Bracewell's Policy Resolution Group, said in an interview. "That's going to be important because there's so much money being invested in clean energy, including in those Blue Wall states."

Segal noted that Walz is also a strong supporter of biofuels such as ethanol. Midwestern states accounted for about 93% of US ethanol production in 2023, according to the US Energy Information Administration.

"He's been supportive of carbon-free electric generation, but on the other hand, he's also supportive of biofuels," Segal said. "And the amount of ethanol used in an EV is exactly zero."

In Minnesota, Walz created the Governor's Council on Biofuels, and he signed a state sustainable aviation tax credit into law.

Allan Marks, a partner at Milbank LLP, added that Walz could prove to be a valuable governing partner for Harris under a divided government scenario.

"If you have the Republicans controlling one or both houses in Congress, that's a very different dynamic," Marks said in an interview. "There, I think she'd have to lean on Tim Walz for something different, which is his ability to work across the aisle from when he was a member of the House."

Walz's record has demonstrated his ability to "walk the walk" on energy issues in a purple state, said Mona Dajani, global co-chair of energy, infrastructure, and hydrogen at Baker Botts. "He has made Minnesota a national leader on clean energy, and he was able to accomplish this in a purple state with only a very thin Democratic majority in the legislature. That's a big deal," she said.

Mining interests

Minnesota is home to several mining projects, including Antofagasta PLC unit Twin Metals Minnesota LLC's proposed copper-nickel Maturi project and Glencore PLC and Teck Resources Ltd.'s joint NorthMet diversified metals project.

Walz has largely avoided getting involved in the continuous legal debates and a federal land withdrawal surrounding the projects. However, Julie Lucas, executive director of industry group MiningMinnesota, told S&P Global Commodity Insights that he has expressed support for Minnesota's environmental standards for mining projects. MiningMinnesota includes Twin Metals in its ranks.

That regulatory support, coupled with Walz's recognition of the critical minerals needed to achieve net-zero goals, is likely to define the governor's approach to mining issues at the federal level.

Walz "has always recognized that clean energy is built with minerals," Lucas said. "Governor Walz is well aware of Minnesota's massive resources for copper and nickel, and so my hope is that he carries that into this role and that we can have a bigger conversation about what not just Minnesota, but what other states can produce as well."