Daily on Energy, sponsored by EFP: Natural gas group makes new climate commitments

The group, which represents the natural gas pipeline industry, is the latest fossil fuel interest to set a net-zero target as it seeks to position itself for the clean energy economy envisioned by President Biden.

Note: Net-zero is generally a threat to natural gas, although Biden has not articulated the role he envisions for it out to 2050, so there’s a lot we don’t know. INGAA is just saying it will pursue net-zero for the things it is responsible for, meaning the emissions involved in moving natural gas.

“Even as INGAA’s members recognize the important societal benefits of natural gas, we know that more must be done to reduce emissions that contribute to climate change,” INGAA wrote as part of its 2021 clean energy commitments.

To achieve the new goal, INGAA is promising to reduce the carbon intensity of its natural gas infrastructure, as well as adopting and investing in technologies such as renewable natural gas and carbon capture, and transporting low or zero carbon fuels like hydrogen. The products delivered by INGAA’s network could support the growth of variable renewables, the group says.

“There are lots of ways to decarbonize the energy delivery highway,” David Slater, INGAA’s chairman said in a press briefing this morning, who added the interstate pipeline network supported by his group delivers a third of the energy the U.S. consumes.

Methane maneuvering: INGAA officials also said they could support restoring Obama-era methane regulations on pipelines if changes are made to allow more time for leak repairs. Gas pipelines were exempted from methane controls under former President Donald Trump‘s EPA.

Amy Andryszak, INGAA’s CEO, said the group would be “open” to support Biden imposing methane regulations on new and existing pipelines and storage facilities.

But like other energy groups that have come out in support of methane rules, she added caveats. “They need to be safe and sound and effective and need to avoid unintended consequences that could impact reliability,” Andryszak said.

Andryszak would not characterize her group’s position as new. INGAA never challenged EPA’s authority to issue methane regulations, as the American Petroleum Institute and Independent Petroleum Association of America once did.

Rather, INGAA was concerned about a “technical issue” related to how the Obama rules addressed leak repairs.

“This is not a new position just because of a new administration,” Andryszak said.

Lobbying Biden: While INGAA, like other fossil fuel interests, is signaling it can work with Biden in certain ways, it opposes his early moves to restrict oil and gas development and reject the Keystone XL pipeline.

Andryszak claims there will still be demand for new pipelines, even as the newly Democratic-led FERC looks to apply stricter reviews of emissions impacts.

She sought to remind Biden he never campaigned as explicitly anti-natural gas.

“Biden was very supportive of natural gas on the campaign trail and we are going to take him at his word,” Andryszak said. “We still believe we will see pipelines able to continue to be built.”

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CAPITO LOOKS TO SHAPE BIDEN CLIMATE AGENDA: Sen. Shelley Moore Capito, the incoming top Republican on the Environment and Public Works Committee, is “disappointed” with Biden’s first-week executive actions targeting the fossil fuel industry, but that won’t deter her from cooperating with Democrats on combating climate change.

“I don’t feel like being in a pivotal position, my only role is to say no and throw rocks. Hopefully, I won’t get too discouraged,” Capito, a relative centrist who represents the fossil fuel state West Virginia, told Josh in an interview yesterday.

Her first priority? Infrastructure.

“President Biden has talked about job creation, and that is the natural place to go,” Capito said. She wants to start with a bipartisan surface transportation bill the EPW Committee approved last year.

The incoming Democratic chairman of EPW, Sen. Tom Carper, a Biden friend and ally, told Josh he wants to work with Capito, but said he would build off last year’s bill. “I want to make it even better,” Carper said.

Other highlights: Capito said she thinks the Biden EPA can forge a compromise on carbon regulations for power plants between the Trump ACE Rule that the D.C. Circuit rejected, and the Obama Clean Power Plan.

Capito also said she could support the EPA directly regulating methane (sensing a theme here). “The natural gas industry grew so rapidly with these discoveries, we need to catch up. If that’s what we need to do in terms of methane regulation, I am willing to take a look,” Capito said.

She opposes setting a net-zero emissions target unless Biden can more specifically define what it means for fossil fuels, but she is willing to consider comprehensive climate policies such as carbon pricing or a clean electricity standard, depending on how they are structured.

“I am a little concerned I am coming across as not open-minded,” Capito said. “I am.”

BIPARTISAN SUPPORT FOR CLEAN ENERGY POLICIES: New polling from Citizens for Responsible Energy Solutions, a conservative clean energy group, finds nearly two-thirds of Americans, including 59% of Republicans, back increased government support for clean energy.

The polling, shared first with us, also finds 52% of voters support an “all of the above” energy approach that would include fossil fuels. Support for that approach is higher among Republicans (61%) and independents (51%), while less than half (45%) of Democrats support such an approach.

The CRES survey reveals strong support for several climate policies across partisan lines, including clean energy tax credits, planting more trees to store carbon dioxide, financial incentives for farmers to engage in sustainable practices that store carbon in soils, and federal funding to build electric car chargers.

Heather Reams, CRES executive director, said that Congress must build on the bipartisan energy package included in year-end spending legislation. “There is no better time for continued Republican leadership on meaningful, bipartisan proposals that aim to mitigate climate change while simultaneously supporting American jobs and technology advancement,” she said.

TRIBES EXEMPT FROM DRILLING BAN: Native American tribes are exempt from Biden’s 60-day freeze on new oil and gas leasing and permitting on federal lands, Reuters reported yesterday.

“The approval process for oil and gas activities does not apply to tribal and individual trust lands,” Interior spokesman Tyler Cherry said in an email.

The clarification comes after the Ute Indian Tribe, an oil-producing tribe in Utah, wrote a letter to Interior saying Biden’s temporary order is a “direct attack on our economy, sovereignty, and our right to self-determination.”

More coming: Biden as part of a suit of executive actions tomorrow is expected to go further by barring all new oil and gas leases on federal lands and waters for an indefinite period while the administration reviews the legal and policy implications of the current federal minerals leasing program, the New York Times reported.

SCHUMER CALLS FOR BIDEN TO DECLARE CLIMATE ‘EMERGENCY’: Senate Majority Leader Chuck Schumer last night urged Biden to declare climate change a national emergency, which would unlock new executive powers for the president to shut down oil exports and promote rapid clean energy development.

“Now, Trump used this emergency for a stupid wall, which wasn’t an emergency,” Schumer said on MSNBC. “But if there ever was an emergency climate is one. So I would suggest that they explore looking at climate as an emergency, which would give them more flexibility.”

Liberal climate activists cheered Schumer’s position, even as the research group ClearView projects Biden will stop short of a “break-glass” climate emergency.

“We can’t afford to wait any longer to muster the full powers of the federal government to combat this existential crisis,” said Brett Hartl, government affairs director at the Center for Biological Diversity.

FILIBUSTER SAFE FOR NOW: Senate Minority Leader Mitch McConnell gave his blessing last night for a power-sharing agreement between Republicans and Democrats to go forward after two centrist Democrats reiterated their opposition to ending the legislative filibuster, the Washington Examiner’s Kerry Picket reports.

The agreement would enable the Senate, split 50-50 between the parties, to organize and allow Democrats to begin to take control of key committees.

His statement came after Democratic Sens. Joe Manchin of West Virginia and Kyrsten Sinema of Arizona reiterated their opposition to changing the legislative filibuster rules.

The agreement was delayed for several days after McConnell wanted assurances from Democratic leadership to keep the filibuster, a Senate provision that mandates 60 votes are needed to halt debate on legislation in the chamber and that is often used as a delay tactic.

Bottom line: The filibuster is safe for now, but Schumer, who did not guarantee he won’t eventually abolish it, will likely still face pressure from his left if Republicans block Biden’s agenda including on climate.

BLACKROCK WANTS NET-ZERO DISCLOSURES FROM COMPANIES: The investment giant, which itself is taking new steps toward net-zero commitments, is asking the companies it invests in to disclose “a plan for how their business model will be compatible with a net-zero economy,” wrote CEO Larry Fink in his annual letter to CEOs released today.

Companies shouldn’t wait on regulators to impose disclosure requirements either, Fink said. He added that private companies, along with public companies, should embrace disclosing the risks their business faces from climate change and policies to curb emissions.

“I believe that the pandemic has presented such an existential crisis – such a stark reminder of our fragility – that it has driven us to confront the global threat of climate change more forcefully and to consider how, like the pandemic, it will alter our lives,” Fink wrote.

BlackRock’s own commitments: The investment firm said it will move to align its assets with a net-zero emissions world, including by revealing what proportion of its assets are already aligned with such a climate target. BlackRock will also set this year a goal to have a proportion of its assets be aligned with net-zero emissions by 2030, Fink wrote in a separate letter to the firm’s clients.

FED CREATES CLIMATE COMMITTEE: The Federal Reserve announced yesterday it has recruited Kevin Stiroh of the New York Federal Reserve to lead the central bank’s climate change work and chair the newly formed Supervision Climate Committee.

“The SCC will build on our climate change work already underway across the Federal Reserve System, and help us take a careful, thoughtful, and transparent approach to analyzing these potential risks,” said Randal Quarles, the Fed’s vice chair for supervision, in a statement.

The new committee comes as the Fed has increasingly sounded the alarm on climate change in recent months. The Fed recently joined a network of global central banks focused on climate change, and in November, it included discussion of climate change risks in its semiannual financial stability report for the first time ever.

The SCC, according to the news release, will be a system-wide group with senior staff across the Fed’s board and its reserve banks. Ilmi Granoff, finance program director at the ClimateWorks Foundation, called it an “enormously big deal” because it will mobilize the Fed’s more than 400 economists on climate change.

Granoff also praised Stiroh, who has been increasingly focused on climate risks in recent years including as co-chair of the Basel Committee on Banking Supervision’s Task Force on Climate-related Financial Risks. “We should expect a step change in sophistication on climate risk supervision,” Granoff said.

YELLEN CONFIRMED: Janet Yellen was confirmed as Treasury Secretary in a strong bipartisan vote last night, installing a supporter of carbon pricing at the top of the agency.

Yellen, during her confirmation hearing, pledged to appoint a climate expert at the senior level in Treasury to create a hub within the agency to focus on climate change as a financial systemic risk. She also told senators she backs requirements for companies to disclose their climate risks and is supportive of “effective carbon pricing.”

BIDEN’S ELECTRIC VEHICLE PROMISE: Biden wants to replace the entire “enormous” federal fleet of vehicles with “clean electric vehicles made right here in America,” which he said during remarks yesterday would create 1 million auto worker jobs in clean energy.

The statement came during remarks unveiling his “Buy American” executive order. (We took a look at the clean energy connection in yesterday’s newsletter.)

The executive order itself, however, doesn’t mention electric cars. It’s possible we could see this sort of directive in tomorrow’s suite of executive actions on climate change, expected in part to direct federal agencies to take climate change into account in its decisions, including purchasing decisions, according to the New York Times.

Biden, in his remarks yesterday, also said his administration will make “historic” investments in research and development in markets such as battery technology and clean energy.

“Together this would be the largest mobilization of public investment and procurement infrastructure and R&D since World War II,” he said.

MORE CLIMATE POLICY RECS FOR BIDEN AND CONGRESS: Chief among the recommendations from the Center for Climate and Energy Solutions, which works closely with major corporations on climate change, is an economy-wide carbon price.

That policy has increasingly been getting a warmer reaction from the business community including the U.S. Chamber of Commerce, but, as Josh reported recently for our magazine, that doesn’t mean Republicans will get on board.

In the absence of an economy-wide carbon price, C2ES urges Congress to pass a clean energy standard, a technology-neutral policy that would put the power sector on a path toward net-zero emissions.

If that policy can’t get across the finish line, C2ES is calling on the EPA to enact new greenhouse gas standards for the power sector, though the group thinks the agency should start work on those right away, without waiting for Congress to act, Elliot Diringer, C2ES’ executive vice president told reporters this morning.

The C2ES recommendations also include recommendations for how Biden can leverage procurement to support clean energy and steps to strengthen disclosure of climate risk, among other suggestions.

VINEYARD WIND RESUMES FEDERAL PERMITTING: The project, slated to be the first large-scale offshore wind farm in the U.S., had paused its federal permitting process last month amid choosing a new turbine technology and after several delays during the Trump administration.

In a statement yesterday, though, Vineyard Wind said it determined it didn’t need to make any changes to its construction and operations plan as a result of the new turbine technology from General Electric and permitting could resume.

“[W]e expect that BOEM can finalize their review based on the extensive analysis and studies of the project over the last three years,” said Lars Pedersen, Vineyard Wind’s CEO.

It doesn’t hurt that the timing means Vineyard Wind is now facing the Biden administration, which is apt to approve offshore wind projects more quickly as Biden aims to increase adoption of renewable energy.

MOVERS AND SHAKERS: The conservative clean energy group ClearPath has hired Spencer Nelson, a former top aide to Republican Sen. Lisa Murkowski when she chaired the Energy Committee last year.

Nelson was the lead negotiator for the Republican majority on the massive clean energy innovation package that became law in December. At ClearPath, where Nelson previously worked before leaving for the Hill in 2019, he’ll be launching a new research project focused on modeling and analyzing ways to achieve U.S. decarbonization in the power sector.

The Rundown

New York Times New U.S. strategy would quickly free billions in climate funds

Wall Street Journal US mounts a charge to take on China, the king of electric-vehicle batteries

Bloomberg Three NYC pension funds to divest $4 billion from fossil fuels

Calendar

WEDNESDAY | JAN. 27

9:30 a.m. 106 Dirksen. The Senate Energy and Natural Resources Committee holds a confirmation hearing for Jennifer Granholm to be the Secretary of Energy.