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U.S. Utilities Anticipate Negative Effects From Obama's New Climate Policies

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U.S. Utilities Anticipate Negative Effects From Obama's New Climate Policies

On Tuesday at Georgetown University, President Barack Obama outlined the first-ever set of U.S. governmental plans to regulate corporate environmental footprints.

As reported by the Wall Street Journal, the president proposed to place limits on carbon dioxide emissions from coal-based power plants.

Reactions to the news were mixed, with the coal industry expressing fears of obsolescence, and critics noting a possible increase in consumer electricity prices due to the new policies. Major American fossil fuel utilities such as Peabody Energy (NYSE: BTU), Arch Coal (NYSE: ACI) and Cloud Peak Energy (NYSE: CLD) would be adversely affected by Obama’s climate control policies.

On the flip side, Obama’s proposals were heartily received by renewable and cleaner energy industries, which include wind, solar, nuclear and natural gas power. A federal restriction on coal could likely provide a widening market for big alternative energy companies such as NextEra Energy (NYSE: NEE), Devon Energy (NYSE: DVN) and Sandridge Energy (NYSE: SD).

In addition to his carbon policies, the president also brought up the issue of the Transcanada (NYSE: TRP)-owned Keystone XL pipeline, a critical underground oil line which, if built, will stretch 1,179 miles from Nebraska to Canada and transport up to 830,000 barrels of transnational crude everyday. The president stated that he would approve the pipeline’s construction in the future, but only if doing so would not “significantly exacerbate the problem of carbon pollution.”

 

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