Q&A: Energy & Natural Resources: roundtable.

• Position: SPECIAL REPORT: ROUNDTABLE - Discussion

PARTICIPANTS

Adrienne Bell, Holland & Hart, LLP

Dan Black, Vivint Solar

Josh Brown, Rio Tinto Kennecott

Cindy Crane, Rocky Mountain Power

Angela Franklin, Holland & Hart, LLP

Jerry Hascall, Sunnyside Cogeneration Plant

Mark Keim, Big West Oil

Christine Watson Mikell, Enyo Renewable Energy

Gary Takanaka, Bronco Utah

David Zimmerman, Brahma Group, Inc.

A special thank you to Dr. Laura Nelson, executive director. Office of Energy Development, and Michael Parker, vice president of public policy for the Salt Lake Chamber, for moderating the discussion.

Let's start by giving an overview of the outlook for your industry.

CRANE: We re very optimistic. The industry is changing at an extremely rapid pace. And I see that as nothing but opportunity. It's opportunity for our business, but more importantly opportunity for our customers and our employees as well. It's allowing us to tap what would be looked at as a traditional utility culture and really change to more of an innovative culture. We're looking at innovative solutions for our customers. It's exciting for our business. And it's exciting for our customers, as well as our employees.

TAKANAKA: We are very excited to open this new operation in Utah. We feel there are opportunities for competition in the coal business in the Emery/Carbon Counties area. We're very excited to bring on new employees to help the economies in the area and hope to be in operation soon.

MIKELL: I 've been in the renewable energy industry since 2001 when I started at the Utah Energy Office. At that time we were 98 percent natural gas, coal and oil. And I think as of the end of 2016, renewables make up 10 to 12 percent of our electricity mix. Which it's hard to believe. I've been in the industry for 15 or 16 years and it's taken that long. In 2004 I entered into the private sector and developed the Spanish Fork Wind Project, which was the first wind project in Utah. And the last 10 years I've spent working on developing two other wind projects that were sold to Rocky Mountain Power, the Latigo Wind Project, which was built by sPower. And then another project in Wyoming, called the Pioneer Wind Project. And both those projects were the only two wind projects to be built in either state in probably six years since the projects that Rocky Mountain Power put together. As you can tell, it takes a lot of time to get these kinds of projects developed.

A year ago my joint venture partner decided here were opportunities here in Utah, more in the solar space. So they decided to invest in the company. And now the company's called Enyo Renewable Energy, and we're developing solar and wind here in Utah. I do believe that we're at a tipping point. Last year there were more people in finance than there were projects to invest in. I think that's really telling of the market we're in. There are many companies that are looking to either move to Utah or are currently operating businesses in Utah that want renewable energy for their electricity. We are one of those companies that can support Rocky Mountain Power in those efforts to fulfill those customer needs.

BELL: We've seen a big uptick in interest from developers, national and international companies, looking for new opportunities. Utah has now come on the radar for a number of these companies that have been active on the coast, California in particular. Utah, Colorado, Wyoming--they're all looking for more renewable development as long as all of the pieces come together. So that's the puzzle to solve.

FRANKLIN: I teach a group of junior high aged girls every year. And my point to them is petroleum products are everything we touch and see basically. Unless it's been grown naturally, then it is a petroleum product that's involved in it. And I think it's a message that people need to understand: it's not just going into our cars, it is what we wear, what we touch, what we eat, aspirin, makeup, everything. So I am passionate about educating our young people about what a great industry this is and what it provides to our society.

KEIM: Since the '80s, I've seen the ups and downs in the refining industry. It seems like every decade we go through this. And so when people talk about the downside or the future of the oil industry, I just say, "You know, I've heard this for 30 years." It's been going on for 40, 50 years, where people say there's only so many barrels of oil out there that's recoverable. And every year, technology improves. People are smart, they're innovative; they come up with new ideas to get the oil out of the ground in an environmentally sensitive way. And so these negatives I've heard, you kind of just get used to it. And you ride through it.

There's been a downturn. This last year was really tough for the oil and gas industry in general. The rates dried up. We had one of our worst years from a refining standpoint. But we see a positive future. We see a slow growth. We don't really want the upswings. The consumer really gets hurt when we have swings of gasoline. It wasn't that long ago when gasoline was $4 a gallon here and consumption really dropped off. Now that it's $2.25,2.30, people are buying bigger pickup trucks and driving more, taking more vacations. There's a sweet spot. There's a fair price for gasoline and diesel and petrochemicals. We just need to land on that fair spot.

The swings really hurt the industry. When there's a downturn, you have fewer engineering graduates, you have fewer people that go into the industry and look to it as a future. And in reality, if you look at the pay scale for probably all of our industries, we support middle-class families. Just at Big West, the average salary, with benefits and so forth, is about $120,000. And that's not just for engineers. It's for operators, for maintenance people.

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