Five Takeaways From the BNEF Barrel of Tomorrow Summit – Houston

A few key forces — President Donald Trump, the rise of artificial intelligence and global electrification — have compelled companies across the energy spectrum to adjust their sustainability goals and investment priorities.

That was the message from executives, investors and industry leaders at BloombergNEF’s Barrel of Tomorrow in the Age of AI Summit in Houston on Thursday.

The meeting took place against the backdrop of Trump’s One Big Beautiful Bill, which preserved incentives for some sectors while clawing them back for others. Meanwhile, the nation’s shakeup of clean energy policy has prompted some companies to look for opportunity elsewhere, and the AI boom is forcing grids to expand.

Here are five takeaways from the summit about the state of the energy transition in the age of Trump and AI.

With Trump rolling back clean-tech incentives, some companies are refocusing their efforts abroad. That’s particularly the case for the battered green hydrogen industry, which has seen high costs, falling investment and stalled projects. In the US, gas is “relatively inexpensive,” and selling green hydrogen into Europe makes more sense, according to Gavin Rennick, president of new energy for SLB.

It’s also the case for carbon capture and storage. In a separate panel, Occidental Petroleum Corp.’s Anthony Cottone said the company is positioning its carbon removal product toward mandated carbon markets. Cottone is the president and general manager of the oil and gas major’s carbon removal unit, 1PointFive, which is currently commissioning a direct air capture plant in Texas.

While the US doesn’t have a federally-regulated carbon market, the European Union and other geographies have emissions trading schemes in place that make carbon credits for direct air capture more enticing.

For many green technologies, scaling the Valley of Death and commercializing successfully requires a bit of policy support. And not just carrots, but also sticks.

“We need to transition this not from a voluntary market but to a global regulatory market where there’s actually mandates,” Cottone said of the carbon market. In his view, that’s necessary to lower the technology cost curve and guarantee long-term customer demand for products like carbon dioxide removal credits.

That sentiment was echoed by infrastructure investor Chris Rozell, who co-founded Cresta Fund Management. “I don’t see any case today where you can make alternative fuels at a price that’s lower than crude,” but subsidies could make them “digestible for economies.”

The US grid took more than 100 years to build out and now has to double in size to meet demand. And it has to do it in the next 15 years, according to industry executives.

Connecting the three power main grids is one of the “most cost effective things to do,” said Michael Skelly, co-founder and CEO of transmission developer Grid United. A national policy to develop high voltage power lines would facilitate that, he said.

Frank Kreikebaum, engineering chief for Smart Wires, said his company was able to help data centers connect in half the time of alternate solutions with the aid of hardware to better manage flow across power lines, substations and other equipment.

The bitter battle brewing over how to accelerate the AI data-center build-out without unduly burdening consumers was a key point of discussion, with NRG Energy Inc. CEO Larry Coben asking “Who pays for this expansion?”

Coben also noted that this new wave of infrastructure-building isn’t creating the jobs generated by past build-outs. “Data centers are extremely important, both business wise and to national security, but the long term job creation generally isn’t there,” he said.

Terawatt Infrastructure CEO Neha Palmer, meanwhile, emphasized the need for new power generation as electric vehicles proliferate. Like data centers, EVs need power “as fast as possible but the cost is also incredibly important” especially for heavy duty truck fleets that are comparing the cost per mile versus diesel, she said.

Redwood Materials Inc. Chief Executive Officer JB Straubel said batteries have a role to play in stabilizing the load for data centers, which see oscillating rather than steady power demand.

As US farmers struggle with low commodity prices and a trade war that’s hitting demand, biofuels are becoming a key market for the industry.

“I wouldn’t say it’s the answer, but it’s certainly a big part of the answer,” Donnell Rehagen, chief executive of Clean Fuels Alliance America, said.

Rehagen pointed to recent US proposals on biofuel blending mandates, saying he thinks the Trump administration has come to the same conclusion and “is looking at renewable fuel policy as a way to try to help agriculture get through a time like this.”

Fellow panelist Fernando Candia, Bunge’s vice president of global carbon solutions, said biofuel mandates “have enormous importance” for the industry and farmers, who are looking for the visibility and incentives they provide.