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Energy Trump’s tax reform plans generally adhere to the precepts of the House Republican tax reform Blueprint, but he differs with that outline in some important respects. The House Blueprint proposes, among other things, to allow 100 %expensing of qualified business investments and to deny the deductibility of net business interest expenses. It would also eliminate most fossil fuel- specific tax incentives such as deductions for intangible drilling costs (IDCs) and percentage depletion, but its proposal to allow expensing of all business investment would mitigate the loss of many of the specific deductions. The Blueprint appears to allow both independent and integrated producers to deduct 100 %of IDCs in the year they are paid or incurred. Whilethis would preserve the status quo for independent producers, allowing integrated oil and gas companiesto also expense 100%of IDCs could increase the rate of return on oil and gas wells drilled by integrated companies. This change, in combination with the possible loss of the percentage depletion deduction (which allows cost recovery in excess of cost basis) could ultimately make independent producers less competitive with integrated companies. Trump offered qualified support for the Blueprint’s proposal to allow 100 %expensing — but would limit the provision to manufacturers—and those who elect expensing will lose the deductibility of businessinterest expenses. Further, he may be more inclined to keep traditional fossil fuel-specific tax incentives, such as the deduction for intangible drilling costs and the percentage depletion deduction. While President-elect Trump has spent much of his time discussing federal policy issues surrounding conventional energy resources, he has expressed opposition to continued federal support for the development of wind and solar energy and has said that he will eliminate all federal spending for clean energy research. How he proceeds in the new Congress may be heavily influenced by both electoral politics (e.g., ethanol-rich lowa largely supported his candidacy) and the pre-existing dynamics in Congress. Many congressional Republicans have opposed even temporary extensionsof renewable energy incentives and the fate of these provisions may well be linked to the effectiveness of the Democratic minority. EY 20 | Election 2016 HOUSE_OVERSIGHT_022392