The Trump administration is preparing more executive orders related to energy, including possible action on offshore development, the former head of the president's energy transition team said April 4.
Michael McKenna, an energy lobbyist who headed President Donald Trump's transition teams for the U.S. Department of Energy and Nuclear Regulatory Commission, spoke April 4 at the Energy Bar Association's annual meeting in Washington, D.C.
He acknowledged the Trump administration has had a hard time switching gears after the election and moved a "little bit slower" on filling some cabinet appointments. McKenna blamed "bureaucratic inertia" for delaying the nomination of new FERC commissioners, even though the agency lacks the quorum needed to issue major decisions on power rates, pipelines and other matters.
"Truth be told, FERC's really important to everybody in this room, but outside this room, how important is FERC?" he said.
But the president has otherwise largely done what he promised on energy policy, including initiating a broad rollback of Obama-era climate policies, and more could be coming, according to McKenna.
"I don't think we're quite done with the executive orders," he said. McKenna expects some type of action on "offshore energy development," although he would not clarify whether that applied to oil and gas drilling or renewable energy.
On the sidelines of the event, the former transition team leader said the White House is also taking a hard look at a carbon tax as part of a broader tax reform package - a claim that the White House later disputed on April 4. Some GOP lawmakers have floated the idea of a border adjustment tax to gain more tax revenue from imported goods and encourage U.S. exports, but the proposal has come under heavy opposition, meaning Congress may have to find other ways of funding desired tax cuts.
"If they're not going to do the border-adjustment tax, they're going to have a $1 trillion hole in tax reform," McKenna said. "Very few things can fill [a] $1 trillion [hole]. A carbon tax is one of them."
Although he was not in favor of a carbon tax, McKenna said White House officials were giving the idea a close look. "I think the people who are considering it are seriously considering it and they're senior people so they're not to be dismissed lightly," he said.
The future of DOE was also discussed. Trump has proposed steep funding cuts for certain parts of DOE, which McKenna said could address budget inequities among different energy sources. He pointed out that DOE currently gives about $2.5 billion annually to energy efficiency efforts but only $600 million annually to the department's coal office and $400 million annually to nuclear energy.
"The [energy efficiency] folks have had a pretty good run for the last eight years, and… it's time to rebalance it," McKenna said, adding that the best approach would be to "take the government out of the equation."
But he cautioned that the Trump administration would be lucky to reduce budgets for most agencies, even by small margins of 1%-3%, given resistance from many lawmakers to his proposed funding cuts. Congress controls the federal government's purse strings and "those budgets are exactly where they want them to be," according to McKenna. "I can't recall a single time where there have been actual reductions to a federal government budget."