The looming potential of a major White House administrative shift following the 2020 presidential elections likely will not have a major impact on the power sector, said Vistra Energy President and CEO Curtis Morgan at S&P Global's Power and Gas M&A Symposium in New York City on Tuesday.
Even more aggressive Democratic climate plans — such as Sens. Elizabeth Warren's and Bernie Sanders' plans to ban natural gas fracking in the U.S. — would be favorable to competitive suppliers like Vistra anyway, because it would likely cause natural gas prices to rise, he said.
Although the Trump administration favored baseload power generation like coal, "our coal plants are no more economic today than when the president took over," he said, adding that ultimately, it's state politics that matter most. "I really don't get over-excited about any particular presidential election."
2019 saw a dramatic uptick in state-level clean energy goals, causing power companies like Vistra, which operates across several states, to revamp their local strategies.
"We've got state-by-state strategies and state-by-state playbooks because what happened when Trump went in was states got very active," said Morgan.
For most states, the goal has been a shift away from coal, he said, and that has ultimately been driven by economics, not policy. Though the Trump administration's Department of Energy floated a bailout plan for baseload power early on in the president's tenure, that proposal never came to fruition.
Federal policy needs to be taken with a grain of salt in that sense, leaving companies to ask two questions: "What's the impact, but also what's the probability that something like that could even occur?" said Morgan.
Ultimately energy action "is really happening at the state-by-state basis and less at the national level because things couldn't get done at the national level," he said. But not all states want to see coal go, he told Utility Dive, pointing specifically to action in Ohio and West Virginia. And with coal closures, the politics get even more local and less partisan.
"If you shut up a coal plant down in a Democrat's district, they're not happy with you" even though the Democratic party nationally is much more anti-coal, he said. "Because at the grassroots level, state politicians are all about their communities. And those are big jobs … when you get on the ground and you're talking about a single politician in a single district, it changes the dynamics."
Most recently, Vistra reached a settlement with Illinois regulators to retire 585 MW coal and pay the community $8.6 million to develop a workforce as well as environmental and health projects, which environmentalists called "a real model" for how utilities should approach coal plant retirements.