A👏 449-word👏 under👏 3-minute👏 read
The most widely reported story is Tesla’s earnings – or lack thereof. The company had an abysmal quarter which would have cratered any other stock.
𝗡𝗼𝘁 𝗧𝗲𝘀𝗹𝗮.
Despite the miss, the stock is trading up. That’s thanks to Elon’s minions who faithfully believe he will eventually make good on the long-awaited low-cost model and robotaxi.
Even if he delivers a lower-cost model it will matter little. Tesla is a “dead car company walking.” It’s unlikely to overcome the massive self-inflicted headwinds its pseudo-omnipotent founder has created. Survival will depend upon whether its AI, autonomous driving, and battery business thrives.
I have to digest all the Tesla material before fully commenting. I hope to do so tomorrow.
Today I want to comment on a story that couldn’t be more under the public’s radar. It’s the antithesis of Tesla, yet its impact is far greater.
I’m referring to the departure of Federal Energy Regulatory Commission (FERC) Commissioner Willie Phillips. The White House has asked Phillips to “step down.” His response:
“I heard from the White House, and they expressed their interest that I step aside,” he said. “It’s something that’s not a surprise to me. In fact, I had already planned to do so.”
For the unfamiliar, FERC is the most critical government entity when it comes to energy regulation. It determines the rules of engagement for the utility industry.
Phillips - a Biden appointee - gave the Democrats a 3-2 majority. Until a replacement is appointed there will be a 2-2 deadlock. That isn’t ideal, but it may be preferrable to the pending 3-2 Republican majority.
Republicans controlling FERC isn’t inherently a bad thing. However, Trump being president with FERC being Republican controlled may be, or not.
FERC is certain to facilitate pending fossil-fuel-related decisions, including anything to do with LNG infrastructure. It’s anyone’s guess how it will impact existing gas, oil, and coal power plants. However, it’s a good bet that decisions will likely favor anything not related to renewables and adversely affect renewables. This includes permitting and interconnection reform.
Over the last couple of years FERC passed a number of key orders to improve planning and interconnection. There’s now a question how these orders will be nurtured by a Republican-controlled FERC.
On the flip side, if President Trump is serious about energy dominance and independence, Republican control could be beneficial. The grid is in desperate need of modernization. It’s possible that decisions related to the much-needed transmission and grid infrastructure buildout may be streamlined.
Time will tell, but one thing is for sure: the shift in the balance of power at FERC will be far more impactful than anything Elon does with Tesla.
#FERC #tesla #musk #energyregulation