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A BOOST TO CRITICAL MINERALS MINING: The Trump Energy Department is aiming to provide help to the struggling domestic mining industry and encourage the development of critical minerals to compete with China in a move that it hopes will be embraced by the Biden administration.
DOE issued new guidance yesterday directing its clean energy loan program to provide “preference” to projects that would boost the U.S. supply chain of critical minerals as a national security imperative.
The 11th hour policy follows a September executive order from President Trump directing agencies to take steps to expand production of critical minerals to reduce reliance on China, from which the U.S. imports 80% of rare earth elements. Once home to the world’s largest critical minerals mine, the U.S. has no domestic production of 14 of the 35 minerals the Interior Department listed as critical in 2018.
Why Biden might be interested too: Supporters of the new DOE policy say it’s likely to be welcomed by the Biden administration, which will need to have easier access to materials used in producing clean energy technologies such as batteries that power electric vehicles, wind turbines, and solar panels. The World Bank released a report this year projecting that demand for lithium, graphite, and cobalt will increase 500% by 2050 to meet clean energy demand.
“This is a terrific, though long overdue, step,” said Tristan Abbey, president of Comarus Analytics, a consulting firm that focuses on critical minerals.
“The Biden team knows you can’t do renewables without minerals, and won’t hesitate to take credit for this initiative next year. The mineral supply chain is a tough rock to crack and vastly more critical than solar and wind, which can basically get free money elsewhere these days,” said Abbey, a former Republican staffer on the Senate Energy and Natural Resources Committee who also worked on critical minerals in the Trump administration’s National Security Council.
Joe Biden’s campaign reportedly told U.S. miners that it supports bipartisan efforts to increase domestic production of critical minerals. Democrats of the special House climate committee this year issued a report that acknowledges the need to “secure supplies of critical minerals” and says “many of these materials are in vulnerable or volatile supply chains.”
The issue could take on added urgency as the Biden team looks to respond to the coronavirus pandemic, which has set back mining operations across the world, disrupting critical mineral supply chains.
“We are fully confident the Biden administration would support this,” an senior DOE official told reporters on a call yesterday. “We would not expect this is something a Biden administration would object to.”
Trump changes course on DOE loans: The DOE official said the new guidance is mainly intended to generate “awareness” encouraging mining companies to take advantage of the agency’s Title XVII and Advanced Technology Vehicle Manufacturing loan programs.
The programs have never been used to support critical mineral development, instead having provided funding to electric vehicle, wind, and solar projects, including most notoriously the failed solar-panel maker Solyndra. The loan office has also supported Tesla. Trump has previously called for elimination of the loan programs office in his budget requests, and has only used it to support the Vogtle nuclear reactors being built by Southern Company in Georgia.
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CRITICAL MINERALS PART OF GOP’S PANDEMIC RELIEF: Senate Majority Leader Mitch McConnell’s new “targeted” pandemic relief package released yesterday includes a bipartisan bill that aims to rebuild domestic supply of critical minerals.
The legislation, American Mineral Security Act, seeks to speed permitting for critical minerals mining, identify U.S. critical mineral deposits, and invest in research and development of recycling and alternatives.
Senate Energy Committee Chairman Lisa Murkowski and top Democrat Joe Manchin co-sponsored the bill, which passed their committee last year.
Democrats are unlikely to support the Republicans’ narrower pandemic relief package.
TOP CANDIDATE TO LEAD BIDEN EPA FACES BACKLASH: California top air official Mary Nichols is facing liberal criticism that she has ignored the concerns of minority and lower-income people bearing the brunt of toxic air pollution, Abby reports in a story posted this morning.
Nichols, who as chair of the California Air Resources Board has crafted some of the country’s most aggressive climate policies, is a favorite for the EPA top slot. She’s also said she would take the job if the Biden team offered it to her.
But environmental groups and activists working to clean up the most polluted regions in the state say Nichols has repeatedly neglected their input and chosen climate policies that allow fossil fuel facilities such as oil refineries to continue emitting. Her actions are disqualifying, especially given Biden’s commitment to address pollution in minority and lower-income regions of the country, they say in a letter being sent to the Biden transition team this week.
“If you start with somebody who doesn’t have good relationships already or doesn’t have an open stance to working with the most impacted communities, it’s just going to be an uphill battle from there,” Mari Rose Taruc, an environmental organizer in California who signed the letter, told Abby. The letter is expected to be signed by at least 50 groups and activists.
SENATE EPW COMMITTEE APPROVES NUCLEAR BILL: The Senate Environment and Public Works Committee approved legislation this morning by a bipartisan 16-5 margin that would preserve existing nuclear plants struggling economically while also incentivizing the deployment of smaller advanced reactors.
The American Nuclear Infrastructure Act of 2020 would authorize a federal program through the EPA to distribute credits to nuclear plants at risk of shutting down. It would also create a prize to incentivize the commercialization of advanced reactors, along with requiring the Nuclear Regulatory Commission to identify and update regulatory barriers. And it would create a new fund to clean up abandoned uranium mines on tribal lands.
“Preventing our existing [nuclear] fleet from shutting down prematurely should be an urgent cause if we are serious about climate change,” said Sen. Cory Booker, a Democrat who co-sponsored the bill with Republicans John Barrasso — who was chairing his last meeting of the committee before sliding over to chair the Energy Committee — and Mike Crapo, along with Democrat Sheldon Whitehouse.
Hurdles to passing the full Senate: Liberal Democrats and some environmental groups, including the Natural Resources Defense Council, oppose the bill.
Sen. Ed Markey, a co-sponsor of the Green New Deal, called the legislation a “cash bailout for our nation’s most decrepit and uneconomic nuclear plants.” He suggested wind and solar are being added to the grid at a pace that would enable renewables to surpass nuclear as the largest carbon-free electricity sources.
US OIL DEMAND CAN’T FIND FOOTING: U.S. oil demand fell for the third consecutive week to 18.5 million barrels per day from 19.3 million b/pd the Energy Information Administration reported today in its Weekly Petroleum Status report. Demand is down about 13% compared to the same period last year.
Gasoline, jet fuel, and diesel use declined across the board during the week ending Nov. 27.
EIA also reported crude inventories fell by 0.7 million barrels last week to 488 million barrels, a slight easing of the glut in the market.
US INSURERS’ APPETITE FOR FOSSIL FUELS: The U.S. insurance industry is lagging behind its global peers in acting to stop providing coverage to coal projects, according to an analysis today by Insure our Future, an environmental campaign.
Most European and Australian insurers no longer provide coverage for coal projects. At least 23 companies have ended or limited their coverage for coal projects.
While six U.S. insurance companies have adopted policies to limit coal coverage, they are “riddled with loopholes,” the report found. Liberty Mutual, for example, does not rule out insuring new projects, and is still trying to build its own coal mine in Australia.
All 10 of the U.S. insurers reviewed in the report support lobbying groups that oppose aggressive climate policies. U.S. companies have the largest underwriting market share in the oil and gas industry. None of them have policies restricting oil and gas “expansion.”
VINEYARD WIND TEMPORARILY STOPS FEDERAL REVIEW: Developers of the project, the first utility-scale offshore wind facility in the U.S., said yesterday they had selected GE as its new preferred supplier of turbines and would temporarily withdraw its plans from federal review while it assesses the technology’s effect on the project.
Vineyard Wind expects the technical review to take a few weeks, after which it will resume the formal review process with the Bureau of Ocean Energy Management. But the move will delay a final decision on the project until next year, leaving the project’s fate in the hands of the Biden administration.
That could ultimately be good news for the project: Vineyard Wind had run into delays under the Trump administration’s review. ClearView Energy Partners, in a client note this morning, said it is likely the Trump administration would have eventually approved the project, but there’s less risk of any permit denial under the Biden team.
In fact, under Biden, federal agencies could even speed up review of the project, as the incoming administration is likely to prioritize evaluating and approving offshore wind facilities, ClearView said. Even so, ClearView thinks the change in turbine supplier for the project could mean adding at least six months to the project’s timeline.
2020 POISED TO BE ONE OF TOP THREE WARMEST YEARS: This year is on track to be the second warmest on record, behind 2016, with the five warmest years occurring since 2015, the World Meteorological Association said in a new report released this morning.
“2020 has, unfortunately, been yet another extraordinary year for our climate,” said Petteri Taalas, the WMO’s secretary-general. It is possible, at least a one in five chance, that the average global temperature could temporarily surpass 1.5 degrees Celsius (the more ambitious goal under the Paris Agreement) by 2024, he added.
WAS 2020 A CLIMATE ELECTION? The League of Conservation Voters says their post-election polling shows the answer is yes, especially for those who voted to elect Biden and Democratic candidates to the Senate and House.
Climate change ranked fourth out of 11 issues tested among those who voted for Biden, topped only by the pandemic, healthcare, and racial justice, according to the polling released yesterday with Global Strategy Group and Normington Petts. The groups surveyed 2,000 voters in 10 battleground states.
A majority of voters surveyed also said that Biden has a “mandate” to put in place policies that curb emissions and move the U.S. toward 100% clean energy. That broke down to 92% of Biden voters, 74% of conflicted voters (who considered voting for either candidate during the election cycle), and 32% of Trump voters, according to the data.
The Rundown
Bloomberg OPEC+ works silently to repair crack at oil coalition’s core
Reuters U.S. air monitors routinely miss pollution – even refinery explosions
Wall Street Journal Big companies urge Biden, Congress to address climate change
Bloomberg Biggest U.S. solar manufacturer wants to keep Trump’s tariffs
Calendar
THURSDAY | DEC. 3
1:30 p.m. EPA Administrator Andrew Wheeler gives remarks at the Nixon Presidential Library to celebrate the agency’s 50th anniversary. The remarks will be livestreamed here.
FRIDAY | DEC. 4
11 a.m. to 4 p.m. ET: A one-day virtual conference brings together policymakers, regulators, and leading researchers on the topic of physical climate risk to the U.S. financial system. It is co-hosted by the Climate Impact Lab, the San Francisco Federal Reserve Bank, the Energy Policy Institute at the University of Chicago, the Goldman School of Public Policy at the University of California, Berkeley, the Kenneth C. Griffin Applied Economics Incubator, and Rhodium Group.
