US Energy Policy and M&A

Okay, the election is over, so let's get back to business already. What can we expect from the new, old Obama administration as it leads the country through economic recovery and crafts its energy policy legacy? Candidate Obama advocated a reduction in foreign oil imports and expansion of U.S. energy production to boost the economy and create jobs. He said that increasing energy independence is critical to national security.

President Obama created real controversy over the role government should play in subsidizing energy technology commercialization, which sectors should be favored and regulating environmental impact. Obama's approach is based on his all of the above energy policy. He favors government debt investments in green companies, and hes been hammered for funding some that have gone belly up. But the Energy Department reports that the agency has dozens of programs that funded over 1,300 companies in the renewable energy space, and that less than 1% have gone bankrupt. That's a pretty good batting average.

Obama is using a government venture model to springboard new energy technologies into commercial viability and drive change into our energy mix. Hes forcing the hand of free enterprise to influence the winners and losers in a new energy economy. It seems that free enterprise needs a push, especially in the interest of energy security. Its not a new investment approach. We've seen it before in space exploration, even with the internet, and in Europe, too, with Airbus. Now its cyber security and clean energy technology benefiting from government investment. Will this policy boost energy technology M&A? Well, if its smart money making smart bets, then the outcome can be very positive. When venture investment in emerging technologies is robust and commercialization is vibrant, a dynamic M&A climate is sure to follow. Its the natural progression.

Looking for more? Listen in on Nov. 27 for the World Financial Symposiums Market Spotlight on Energy and CleanTech M&A. Link: www.worldfinancialsymposiums.com.

Posted by , Senior Vice President on 21 November 2012
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