2016 Political Economy

Impact On Energy

A Local Story

“This move is intended to address the challenges we continue to face in a rapidly changing HVAC industry,

with the continued migration of the HVAC industry to Mexico, including our suppliers

and competitors, and ongoing cost and pricing pressures driven, in part, by new regulatory

requirements”

Main Topics Today

US & Intl Economic Situation

2016 Presidential Race

Future Growth

What the Fed watches

Q2 2016 GDP Estimate

3yr Oil and Nat Gas

US Dollar Index

US 2yr Treasury Yield

German 2yr BKO Yield

Japan 2yr JGB Yield

Chinese Stock Market

How To Grow

Big Problem

Political Econ Growth Pts.

Free Trade=lower tariffs

Reg. Relief=reduced costs

Tax reform=capital formation w/incentives

Infrastructure=efficiency

Trump PlanCut Corp Tax to 15%

Limit Pass Thru 15%

1x 10% Repat Tax

Ag TPP and NAFTAImpose tariffs on imported goods

Big Drop in InterestDeductibility

100 Day Energy Plan

Save coal industry

Pass Keystone

Rescind Obama executive actions: Climate Action Plan

and the Waters of the U.S. rule

Lift moratorium on energy on federal lands

Cancel Paris Climate Agreement

Trump plans help/hurt

Help: big tech & big pharma

Hurt: debt heavy balance sheets

Help: industrials & manufacturers

Hurt: free trade

Help: energy production

CLINTON PLANNo Change 4 Corp or Pass Thru Taxes

New Tax Credits forProfit Sharing andApprenticeships

Restart BABs

No Free Trade

College Tuition Plan

Big Change to Cap Gains

Tax Foundation

Clinton’s new spending

$275B Infrastructure Plan

Fix Roads and Bridges

National Freight Inv. Program

$25B Infrastructure Bank

Energy Plan

500mln solar panels by 2021

Implement Clean Power Plan

Clean energy challenge

Implement Paris agreements

Clinton plans help/hurt

Help: ACA managed care, hospitals, Medicaid HMOs

Hurt: raises taxes on top earners/capital formation

Help: construction, enginering firms

Help: muni bonds

Hurt: energy production

2016 Recap

Clinton: no big biz tax plans, large infrastructure plans,

build on current regulations,negative free trade,

renewable energy production,

Trump: tax cut plans,reduce regulations, full expensing,

hurt free trade, big energy

Don’t Forget The Senate!

1st Time Ever: Trump is ahead

The 10yr Debt Time Bomb

LT Growth Trend

Your future challenge is now

Your Tornado?

Your Hero?

Tiny, But Growing

Energy Storage

Source: GTM Research Energy Storage Monitor 2014

Future Hero?

Final Thoughts…