The Upcoming Infrastructure Package And Its Impact On The Energy Sector

President-elect Donald Trump has made infrastructure investment one of his top priorities for the first few months of his administration. While the details of the program are still unclear, these investments may have real impact in the energy sector. Here's why:

1. The definition of infrastructure. Trump has vowed to push for $1 trillion in investments. Given that enormous number, the definition of infrastructure will be very broad. New pipelines, upgrades to the grid, and other energy projects will probably be included in the Trump definition of infrastructure as a way of reaching his target. This creates a potential new funding stream for companies looking to invest in this area.

2. Tax credits. Given what we know so far, Trump will rely on tax credits and public-private partnerships - or P3s - for his infrastructure package. The energy area is a fertile ground as many energy infrastructure projects have more natural private sector partners than other kinds of investments.

3. The power of contrast. Trump has been critical of the Obama Administration's energy policies such as their rejection of the Keystone Pipeline. Making large and visible investments in the energy sector - and particularly the fossil fuel industry - is one way Trump may look to differentiate himself from the Obama Administration.

These investments could have long standing impacts. Infrastructure can influence behavior. If the new Administration successfully advances energy infrastructure, these projects could affect the energy landscape for years to come.