TOM DENNIS, EXECUTIVE VICE PRESIDENT

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1 DC UPDATE WYOMING INFRASTRUCTURE AUTHORITY Cheyenne, WYOMING February 3, 2015 TOM DENNIS, EXECUTIVE VICE PRESIDENT 733 Tenth Street, NW, Suite 400 Washington, DC (202) ; Toll Free: (888)

2 NEW CONGRESS, EAGER TO GOVERN PRESIDENT S CLIMATE AND CLEAN ENERGY PROGRAM ENERGY AND ENVIRONEMTAL LEGISLATIVE OUTLOOK PRODUCTION TAX CREDIT S FOR WIND ENERGY AND 1603 GRANTS FOR SOLAR EPA REGULATION S FOR COAL FIRED POWER PLANTS TRANSMISSION AND GRID ENHANCEMENT

3 PRESIDENTS STATE OF THE UNION ADDRESS Unlike his previous emphasis calls for an all-of-the-above strategy developing every available source of American energy, the President said: Today, America is number one in oil and gas. America is number one in wind power. Every three weeks, we bring online as much solar power as we did in all of He placed greater emphasis on renewable energy and a clean energy economy to combat climate change No mention of reducing carbon emissions utilizing advanced coal technologies

4 PRESIDENTS STATE OF THE UNION ADDRESS President stressed that 2014 was the planet s warmest year on record and 14 of the 15 warmest years on record have all fallen in the first 15 years of this century. The President touted the agreement between the US and China on emission reductions of carbon. Called on Congress to again to address climate change Despite the President s push, it is not anticipated that climate change legislation will be enacted in the 114 th Congress

5 NEW CONGRESS House Republicans:246 Democrats:188 1 vacancy Senate--- New Sheriff in Town Republicans: 54 Democrats: 44 Independents: 2

6 ENERGY LEGISLATIVE OUTLOOK SENATORS MURKOWSKI AND CANTWELL KEYSTONE XL PIPELINE VETO? EPA REGULATIONS 111 (d) ROLL-BACK? LNG EXPORTS CRUDE OIL EXPORTS? OPENING UP LANDS FOR DRILLING ADVANCED COAL TECHNOLOGIES ENERGY EFFICIENCY GRID MODERNIZATION OVERSIGHT IN BOTH CHAMBERS ON EPA

7 TAX INCENTIVES FOR ENERGY President has called upon Congress to adopt a Clean Energy program making permanent the wind and solar tax credits Also an elimination of fossil fuel tax benefits Elimination of Master Limited Partnerships (MLP s) Increase in gasoline tax?

8 Advanced Coal Technologies DOE s Proposed Budget leans on tax credits for CCS Large scale commercial demonstrations with CCS remain expensive and cry out for a government/private sector partnership. Utilities need rate approval from State Public Utility Commissions for investment of rate-payer funds. Not enough direct grant funds to stimulate the private sector ITC s may help, but a large program that proves the economics and operational viability of CCS technologies is needed to make the transition from today power plant fleet work Expect Senator McConnell to forge a bi-partisan coalition on advanced coal technologies

9 PRODUCTION TAX CREDIT (PTC) FOR WIND ENERGY Expires in December of 2015 For all practical purposes PTC has expired PTC has worked in accelerating turbine design and efficiency Without the credit most wind projects are not economic but the gap is closing PTC expected to be phased out if not eliminated

10 ITC FOR SOLAR ENERGY Ends in 2016 Not favored by Republican majority in either chamber Could be eliminated early

11 TRANSMISSION Federal government engaging in large scale high-voltage projects to modernize the Nation s electric grid, Departments of Interior, Energy, Agriculture, CEQ and FERC mounting unprecedented effort to streamline the siting of transmission, but is it working? Two Wyoming Transmission Project s were selected as priorities for siting by the Federal Rapid Response Team. TransWest Express and Gateway West. Final records of decision pending. FERC spearheading regional transmission planning with Order 1000 and electricity markets like California s Energy Imbalance Market (EIM) are expanding Congress continues to lag behind in moving legislation to spur on faster development of transmission facilities, but expect activity this Session Growing concerns about cyber terrorism and overall grid security

12 Overall Outlook Post-Election year politics remain front and center President will use the maximum extent of his Executive Power to achieve in regulations what he can t obtain via legislation Expect both threats and actual veto's on a range of legislation Presidential Politics impacting legislation will go into high gear in the about 15 months Despite the above, I see positive action on energy matters in this Session of Congress