The following panel excerpt from Privcap Game Change in Houston can be found in the Privcap Game Change: Energy 2016 Report.

Privcap: If you had to pick one or the other— conventional oil and gas or renewables— over the next 10 years, where would you invest $100 million?

Mark Bisso, Och-Ziff: The downturn has had some favorable impacts on the upstream sector—the industry is more efficient, capital structures are healthier, and the general approach to development is more constructive. If you look at the supply and demand dynamics, demand growth remains strong—we should be up 1.3 million barrels per day this year—and supply may face challenges as a result of the significant reductions in capital investment over the last two years.

Privcap: Brian, what would be your argument for oil and gas as the winning 10-year bet?

Brian Crumley, Vortus Investments: It’s still a commodity business, so you have to be the low-cost producer. That’s what makes you the winner. And we like the risk-adjusted returns here in the U.S., where we’re focused.

Privcap: Team renewables, what do you think?

Michael Hoffman, Riverstone Holdings: We come with experience on both sides of the house. But we feel pretty strongly we’re at a tipping point for renewables. And let me separate renewables into two buckets. Ethanol biodiesel [is] not a good business; you need $80-plus oil. I don’t even need to discuss that. On the renewable power side, however, we are at a very different point than we were five years ago in our last fund. Five years ago, we needed tax benefits to make these things work. But as we sit here today, a gas plant, a wind farm and a solar plant are intermarginal, without tax benefits. We do not need a subsidy for renewables anymore.

David Scaysbrook, Quinbrook: It’s true that a lot of fortunes have been won and lost in oil and gas, particularly here in Texas—but it’s the lost part that we need to focus on. Oil and gas is really a story of volatility. It is true that you could be chasing 3x, 4x, 5x in a private-equity oil and gas play, but you could lose your shirt as well. And fundamentally, institutional investors really need that money to be there.

The U.S. could become a major exporter of natural gas, especially to our neighbors to the north and south. Does that change the equation at all for the outlook for your investment strategies?

Hoffman: If the demand for gas [increases]— because we export to Mexico, Canada—LNG exports … will probably be a good investment. That’s only good for renewables, because we’re already competitive.

Scaysbrook: This is where our worlds cross over. You can’t really be a long-term investor in renewable energy these days without fundamentally understanding gas. And the reason for that is, with the retirement of coal plants at an accelerated rate, and with zero-cost renewables from a fuel perspective like wind and solar pushing gas plants further out, it becomes the price-setting plant. Gas becomes the method by which the clearing prices for power are set in most deregulated power markets increasingly around the world.

Privcap: There is someone who describes himself as Republican in the White House, and we have a Republican Congress. How does that change the game?

Bisso: There’s been a lot of talk on coal, but I don’t see it having too much of an impact on the industry given the fundamental economic challenges facing this sector. But, clearly the regulatory environment will improve. On the pipeline front, there’s been a lot of news over the last 12 to 18 months given the existing administration’s hostility towards several key projects.

With the new administration, you will likely see those projects move forward, which should also have positive implications for the midstream sector more broadly. On drilling, the new administration will likely remove a lot of the lingering risks around additional fracking regulations; this will be a relief to a lot of producers.

Hoffman: There’s been some hype that the new Trump administration is going to kill the renewables business. On the reality side, the clean power plant is probably dead on arrival. And that would affect renewables way out in the late 2020 time frame anyway. 90% of renewables are based on state mandates, which are only going up. Oregon’s [mandate is] up at 50%. California is at 50%. New York is at 50%. So you’re seeing the states who have nothing to do with the federal government in this regard increasing the demand.