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MURKOWSKI’S INFLUENCE: Centrist Republican Lisa Murkowski exercised her huge influence today by voting to approve Deb Haaland to be Interior secretary.
Murkowski’s vote enabled Haaland’s nomination to be moved to the Senate floor on a bipartisan basis. All other Republicans opposed her because of her liberal credentials and past opposition to fossil fuel development.
Her decision hints that President Biden can count on Murkowski as one of only a few Republicans who will cross over to support his agenda, and ensures he will continue to try to woo her. That gives Murkowski a level of leverage to extract concessions from Biden, most significantly on energy policy.
Murkowski’s home state of Alaska, a major oil state, has been implicated in some of Biden’s early moves, including his decisions to pause new oil and gas leases on federal lands and block drilling in the Arctic National Wildlife Refuge (Murkowski led the GOP effort to open ANWR to drilling in 2017).
Murkowski, a former chairman of the Energy Committee, has already reportedly tried to exploit her power.
Before Neera Tanden withdrew her nomination to be OMB director, Biden’s staff was negotiating with Murkowski, who was undecided, and “very willing to cut a deal” to modify the administration’s energy policies, Politico Playbook reported.
Murkowski has denied that she requested a concession from the White House in exchange for backing Tanden or any other nominee, according to the Washington Post.
Murkowski similarly was one of the last of key senators to keep her stance on Haaland private, and she delivered a lengthy wind-up before delivering her verdict suggesting she intends to get something in return.
Murkowski said she “struggled” with whether to approve Haaland as she “reconciled a historic nomination with my concerns about an individual and administration’s conception of what Alaska’s future should be.”
She spent “a considerable amount of time” with Haaland to “reiterate what is at stake” for Alaska, and ultimately was convinced by Alaska Natives who were “enormously proud” that Haaland could become the first Native American Cabinet secretary.
“I am going to place my trust with Rep. Haaland and her team despite some very real misgivings,” Murkowski said. “She told me she knows she will need to represent every Alaskan. I am also going to hold you to your commitments to ensure Alaska is going to prosper.”
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OIL PRICES SOAR AS OPEC+ HOLDS ‘POWDER DRY’ ON OUTPUT: Oil prices are soaring after OPEC+ reportedly decided today not to increase production next month, keeping in place output cuts designed to allow more time for demand to come back from the depths of the coronavirus pandemic.
Saudi-led OPEC and its allies, led by Russia, had been debating whether to restore as much as 1.5 million barrels of production in April. But Saudi Arabia’s energy minister Prince Abdulaziz bin Salman urged members in comments at the outset of their meeting to “keep our powder dry” in increasing output too fast.
The output cuts have “accelerated” the balance of supply and demand, he said, while warning the cartel to keep a “contingency in reserve against any unforeseen outcomes,” as vaccines are rolled out across the world.
As a result of the decision, the Brent crude oil price rose to near $67 per barrel as of this writing.
GINA MCCARTHY DOWNPLAYS REGULATORY BURDEN ON INDUSTRY: Biden’s climate advisor Gina McCarthy today downplayed the role of regulations and standards in the administration’s policy mix.
Speaking before the energy industry at CERAWeek by IHS Markit, McCarthy suggested the sheer force of the administration’s planned investments in R&D and deployment, along with its plans for the government to procure clean energy technologies for its own use, would send market signals that last beyond the next four years.
“It’s really important for this not to be just looked at as a regulatory challenge,” McCarthy said. “Standards are great. But this is bigger than that.”
McCarthy, known for developing the Obama administration’s Clean Power Plan, said she is not deterred from setting new regulations for power plants and automobiles despite former President Donald Trump stocking the courts with more conservative judges. The U.S. surpassed the emissions reductions set by the Clean Power Plan, which was never implemented, through market forces.
But McCarthy signaled the administration’s biggest gains would come through investments supporting domestic manufacturing of electric vehicles and batteries, and through spending on grid improvements and EV charging stations in an upcoming infrastructure bill.
“If we do this right, we can send signals to the private market, and if it makes sense there will be efforts that will live far longer” than the Biden administration, McCarthy said. “This is all about how we get to that wonderful tipping point…for the private sector to look at it and say, ‘I get it, I can make money on it [pursuing clean energy]’”.
MCCABE TAKES HEAT FOR ROLE IN CRAFTING CLEAN POWER PLAN: Republican lawmakers told Janet McCabe, Biden’s pick for EPA deputy administrator, that they don’t fully trust her given her involvement in developing the Clean Power Plan.
“You have a steeper hill to climb, frankly, that most,” Sen. Kevin Cramer told McCabe during her confirmation hearing before the Senate Environment Committee yesterday. McCabe worked seven years as a political appointee in the Obama EPA, ultimately helping to lead development of the Clean Power Plan as acting chief of the agency’s air office.
Republicans are still bitter over the regulation, which they saw as overreaching and punishing to energy-producing states, and they’re wary of the Biden administration’s plans to set its own power plant carbon controls (bolstered by a court ruling scrapping the Trump administration’s weaker rule). McCabe would likely play a significant role in helping develop the Biden EPA rule if confirmed.
McCabe, during the hearing, defended her work on the Clean Power Plan, which she called “one of the most important and impactful rules” she worked on during her time in the Obama EPA. She also didn’t directly answer a question from Sen. Shelley Moore Capito, the top Republican on the committee, about how broad of a regulatory reach she thinks the EPA has over power plant emissions.
GOP SENATORS PUSH MALLORY ON PIPELINES AND MINERALS: Brenda Mallory, Biden’s pick to chair the White House Council on Environmental Quality, didn’t receive quite as much scrutiny as McCabe during the hearing yesterday, but she didn’t escape it altogether.
Republicans raised concerns to Mallory that Biden administration efforts to bolster environmental reviews under the National Environmental Policy Act, including by requiring analysis of greenhouse gas emissions effects, could block or slow development of energy projects such as pipelines.
Cramer, for example, asked Mallory to commit that she wouldn’t interfere with an environmental impact statement the developers of the Dakota Access pipeline are required to complete under court order. Many environmentalists and Democratic lawmakers are urging Biden to shut down that pipeline, building on his cancelation of the Keystone XL pipeline.
“I can commit that I will carry out the president’s agenda in making sure that there are decisions that are made based on sound science and full integration of information,” Mallory said in response.
Critical minerals: Mallory also faced questions from Democratic Sen. Mark Kelly about how to speed up approval of mines that produce critical minerals without “compromising the integrity” of NEPA reviews.
Mallory said CEQ faces that challenge for a number of activities, including building out infrastructure, a priority of the Biden administration.
“In a time when the environmental impacts that we’re facing from climate change and other things are so grave, we don’t want to lose the value that NEPA can bring to our decisionmaking, but we also need to figure out ways that will allow us to make these important decisions in a timely way,” she told Kelly.
REPUBLICANS PRESS BIDEN ON NORD STREAM 2: Sen. John Barrasso, ranking member of the Energy Committee, led a group of 40 Republican senators yesterday sending a letter to Biden accusing him of failing to follow the law by not imposing sanctions on entities involved in building Russia’s Nord Stream 2 natural gas pipeline to Germany.
The Republicans pressed Biden to implement the broadening of Nord Stream 2 sanctions approved by Congress in this year’s National Defense Authorization Act, which was seen as a last-gasp effort to stop the $11 billion pipeline.
Biden is seemingly looking to move on and negotiate a solution with Germany, after his State Department recently issued a report to Congress that identified only a single Russian ship and its owner as being in violation of U.S. sanctions. Republican senators say there is evidence of other vessels and companies “engaging in sanctionable activities.”
“The failure of the administration to identify and impose new sanctions signals its willingness to allow President Putin to gain a stranglehold over Europe’s gas supplies and increase its geopolitical leverage,” the Republicans wrote.
INTERIOR REVOKES TRUMP SCIENCE RULE: The Interior Department yesterday revoked a Trump administration rule that imposed restrictions on the type of data and science that could be used in the agency’s decision-making.
The move is “an important step toward restoring trust in government and strengthening scientific integrity at the Interior Department,” said Tanya Trujillo, principal deputy assistant secretary of water and science. Biden’s Interior Department said the Trump administration rule hindered the agency’s ability to enter into contracts for research, and precluded it from using sensitive information, on threatened species for example, to inform policies.
Barrasso criticized the policy change, accusing Biden of “slamming the door” on transparent rules and regulations since the Trump administration order required the publication of scientific data used to make decisions.
GOP SENATORS SEEK TO CODIFY TRUMP FAIR ACCESS RULE: More than half of the Senate’s Republicans, led by Cramer, unveiled legislation yesterday that seeks to block big U.S. banks from restricting specific industries from access to lending and other financial services.
The bill would codify the Trump administration’s “fair access” rule that the Office of the Comptroller of the Currency put forward in response to criticism from Republican lawmakers that big U.S. banks were dropping or refusing to invest in fossil fuel projects, such as new oil and gas drilling in the Arctic, under pressure from climate activists.
Biden quickly put that rule, which wasn’t formally published before the Trump administration left office, on hold and is likely to peel it back.
“Financial service providers do not have the right to circumvent the Constitution or the law to create de-facto bans on legally-compliant businesses like energy producers or firearms manufacturers when they believe it is politically convenient,” Cramer said in a statement.
Republican senators’ bill would also penalize big banks that refuse services to businesses or people based on anything other than impartial, individual risk-based analysis. The legislation is supported by several fossil fuel industry groups, including the Independent Petroleum Association of America and the National Mining Association.
SETTING EXPECTATIONS FOR BIDEN’S PARIS TARGET: The Environmental Defense Fund is calling on the Biden administration to set new target under the Paris climate agreement to slash U.S. emissions by at least 50% by 2030, a goal the group argues is not only necessary to keep pace with global climate targets but also achievable and economically viable.
Biden and his team have said they intend to unveil their new Paris commitment — known as a nationally determined contribution, or NDC — by the climate summit Biden plans to host around Earth Day this year. The Obama administration’s NDC had set a goal for the U.S. to cut emissions 26% to 28% below 2005 levels by 2025.
Critical elements of Biden’s plan: EDF said in a detailed report yesterday the Biden administration should, as part of a new NDC, set a goal to cut methane emissions across the economy by 40% by 2030. The environmental group also said policies to curb electricity emissions, including regulatory mandates and investments in clean energy technologies, are critical because much of the emissions reductions through 2030 come from the power sector.
In addition, EDF said setting a nationwide, enforceable limit on emissions or a price on carbon would allow the U.S. to meet a 50% target more quickly and cheaply.
FEDEX TO ELECTRIFY DELIVERY FLEET EN ROUTE TO CARBON NEUTRAL: FedEx announced yesterday it plans to achieve carbon neutral operations by 2040, initially pledging more than $2 billion to electrify its delivery vehicles, develop sustainable fuels, and support carbon removal and storage research.
To reach its goal, FedEx said it will replace its entire delivery fleet with electric models by 2040. Within the next five years, half of FedEx’s vehicle purchases will be electric, increasing to 100% electric purchase by 2030, the company said.
FedEx’s announcement comes as the U.S. Postal Service is under scrutiny for the slow pace of its commitment to electrify. Postmaster General Louis DeJoy told lawmakers last week the USPS only had the funds to electrify 10% of its next-generation vehicles.
MOVERS AND SHAKERS: Citizens’ Climate Lobby, an advocacy group that lobbies for a carbon tax and dividend, named Madeleine Para as its president today.
Para was promoted from her prior position as vice president of programs.
The Rundown
Wall Street Journal Texas power regulator urged to halt collections as crisis fallout spreads
The Texas Tribune CEO of Texas power grid operator terminated in aftermath of winter storm
New York Times Carbon County, Wyoming, knows which way the wind is blowing
New York Times In the Atlantic Ocean, subtle shifts hint at dramatic dangers
Reuters Democrat Katie Porter says to target Big Oil in new role as natural resources chair
Wall Street Journal GM looking to build second battery factory in US
Bloomberg EVs could make dealerships a thing of the past, too
Calendar
WEDNESDAY | MARCH 10
10 a.m. G-50 Dirksen. The Senate Environment and Public Works Committee will hold a hearing titled, “Building Back Better: Addressing Climate Change in the Electricity Sector and Fostering Economic Growth.”
10:30 a.m. The House Energy and Commerce Committee’s oversight and investigations subcommittee will hold a remote hearing titled, “The Path Forward: Restoring the Vital Mission of EPA.”
