WHAT’S HAPPENING TODAY: Good afternoon and happy Thursday, readers! With the help of our editor Joe Lawler, today’s edition of Daily on Energy takes a closer look at the first energy loan finalized by the Trump administration so far. Plus, in a call with reporters, Energy Secretary Chris Wright indicated all might not be lost for the Grain Belt Express transmission project, which lost its federal funding over the summer.
Today’s newsletter also continues to follow the Trump administration’s efforts to block the International Maritime Organization’s proposed carbon tax on the global shipping industry, as well as the latest on EV sales.
Welcome to Daily on Energy, written by Washington Examiner energy and environment writers Callie Patteson (@CalliePatteson) and Maydeen Merino (@MaydeenMerino). Email cpatteson@washingtonexaminer dot com or mmerino@washingtonexaminer dot com for tips, suggestions, calendar items, and anything else. If a friend sent this to you and you’d like to sign up, click here. If signing up doesn’t work, shoot us an email, and we’ll add you to our list.
DEPARTMENT OF ENERGY CLOSES FIRST LOAN UNDER TRUMP: After a monthslong review into clean energy loans under the Biden administration that many feared would result in most if not all loans being canceled by the Trump administration, Energy Secretary Chris Wright is moving forward on at least one.
The details: The Department of Energy confirmed early this morning that it finalized a $1.6 billion loan for a subsidiary of utility giant American Electric Power to upgrade nearly 5,000 miles of transmission lines. The decision came as a surprise, as the administration has moved to cut DOE’s Loan Programs Office, in both staff and lending authority.
The $1.6 billion loan will go to AEP Transmission to replace nearly 5,000 miles of existing transmission lines with upgraded lines capable of carrying more energy to consumers across the country. The project is expected to create more than 1,000 construction jobs and save consumers $275 million in financing costs over the life of the loan, lowering bills in Indiana, Michigan, Ohio, Oklahoma, and West Virginia.
The first phase of the project will involve replacing roughly 100 miles of transmission lines in Ohio and Oklahoma.
The loan guarantee was first announced in the final days of the Biden administration. Wright confirmed to reporters this morning that none of the terms and conditions of the loan were changed.
Read more from Callie here.
PLUS…WRIGHT CONFIDENT GRAIN BELT EXPRESS WILL PREVAIL: During a press call with reporters this morning, Wright was pressed on why the administration decided to advance the $1.6 billion transmission upgrade project, only months after canceling a similar loan for the Grain Belt Express.
Quick reminder: DOE canceled a $4.9 billion loan for the Grain Belt Express in July. Grain Belt is a massive multistate transmission project, projected to provide upward of five new gigawatts of energy across Kansas, Missouri, Illinois, and Indiana. The transmission lines were expected to stretch more than 800 miles, initially connecting to energy generated by wind farms in Kansas. At the time the loan was canceled, DOE said it found that conditions necessary to issue the funds were unlikely to be met, making it no longer critical for the federal government to support the project.
Wright’s remarks: The Trump administration continued to defend its decision to cancel the loan on Thursday, describing the Grain Belt Express project as risky.
“I love energy infrastructure,” Wright told reporters. “I have nothing against the Grain Belt Express. I suspect it’ll still be developed.”
He explained that as Grain Belt would be building completely new transmission lines, it is far more expensive than a project that is simply replacing existing infrastructure. He also issued the criticism that the developer was planning to rely on renewable power that was “not very well connected to a market.”
LPO senior advisor Greg Beard echoed the secretary’s remarks, saying there was a lot of “merchant risk” involved with the Grain Belt Express.
“When we announced that we weren’t going to go forward with the loan, they announced the same day that they intended to continue with the project using their private capital markets,” Beard said, adding, “That’s the perfect type of capital for a project with that kind of risk profile.”
CANADA OPEN TO REOPENING KEYSTONE PIPELINE: In an apparent effort to ease Trump’s tariffs on products like steel and aluminum, the Canadian government is reportedly considering pursuing restarting the Keystone Pipeline.
Canada’s energy minister Tim Hodgson told the Financial Times this week that the government was “open to exploring Keystone.”
“We are open to discussing the advancement of continental energy security, if we also address the irritants for steel and aluminium,” Hodgson told the outlet.
Canadian officials have been seeking relief from the Trump administration’s recent tariffs, potentially through increasing the amount of energy products it exports across its southern border. Canada is currently the largest foreign exporter of oil products to the U.S. A project like the Keystone Pipeline could increase these exports by more than 800,000 barrels a day.
A U.S. official confirmed to the Financial Times that the president is interested in reviving the Keystone Pipeline, but said it will not be the “silver bullet” for tariff relief discussions.
LOUISIANA REPUBLICAN ADVOCATING FOR ‘ALL OF THE ABOVE’: While the Trump administration has taken a hard line against renewable energy resources, at least one Republican senator is looking to revive support for an “all of the above” strategy.
Louisiana Sen. Bill Cassidy is pushing for “all of the above” at the Louisiana Energy Security Summit today in New Orleans. Ahead of the conference, Cassidy told Daily on Energy alum Josh Siegel that resources including solar and battery storage will be critical to meet demand brought on by data centers and artificial intelligence.
He explained that Louisiana is already using solar paired with battery storage and natural gas as a “peaker source” during times of peak demand. Cassidy said that the state, one of the reddest, has been able to keep costs down relatively using these technologies.
Cassidy, who sits on the Senate Committee on Energy and Natural Resources, is notably breaking away from the president and his cabinet members who have sought to make it more difficult to deploy and develop wind and solar power in the U.S.
Trump escalated his attacks on renewables in August, calling both wind and solar “the scam of the century.” In a post shared to Truth Social, the president voted to not approve any “wind or farmer destroying solar.”
U.S. SEEKS AFFIRMATIVE APPROVAL FOR SHIPPING CARBON TAX: In a late effort to stave off a global shipping carbon tax, the United States has proposed requiring that all nations in the International Maritime Organization affirmatively sign off on new proposals for changing polluting rules, Bloomberg reports. Under the current process, rules are adopted unless at least one third of members object.
The suggested vote change is an apparent effort by the Trump administration to avoid a defeat that is looking increasingly likely, as Callie wrote yesterday. Trump officials have opposed the plan, known as the net-zero framework, to impose fees on excess ship emissions, and have threatened to impose forms of penalties on nations that go along with the policy.
BANK REGULATORS SCRAP CLIMATE PRINCIPLES: This afternoon, bank regulatory agencies rescinded 2023 guidance for large banks related to climate change-related risks.
The guidance had been one of a few marginal steps taken by financial regulators during the Biden administration to incorporate climate considerations into bank supervision. Now, though, the pendulum is swinging in the opposite direction.
Federal Reserve Governor Christopher Waller, one of the candidates Trump is considering for chairman of the central bank, issued a two-word statement on the decision to ditch the guidance: “Good riddance.” Waller had voted against the guidance in 2023, as had Michelle Bowman, who is now the vice chair of supervision at the Fed and who today reiterated a statement that climate change is a serious public policy consideration, but that the Fed doesn’t have a role in climate policy.
ELECTRIC VEHICLE SALES HIT RECORD HIGH: More evidence is surfacing that Americans rushed to buy electric vehicles this summer and the beginning of fall, as EV sales hit a record high in the third quarter.
The details: New data released by Cox Automotive revealed that Americans purchased 438,500 electric cars and trucks in the third quarter – roughly equivalent to around 11% of all new car sales. This marks a new high for EV sales, which previously had a record of 8.7% of all new sales.
Tesla continues to dominate total EV purchases, making up around 41% of all new sales. General Motors is slowly catching up, taking hold of around 15% of all sales in Q3.
As the federal tax credits for EVs and hybrid vehicles expired at the end of last month, there is broad consensus that sales of EVs will dip in the coming months. However, there is still optimism that adoption of EVs will continue to grow, as BloombergNEF estimates nearly half of EV purchases made in the first half of this year were made without any federal tax credits.
Stephanie Valdez Streaty, Director of Industry Insights for Cox, reportedly wrote in a report reviewed by Bloomberg that the group is predicting EVs will make up roughly a quarter of new car sales by 2030.
RELATED, ICYMI – NORWAY SAYS MISSION ACCOMPLISHED ON ELECTRIC VEHICLES: The finance minister of Norway, Jens Stoltenberg, said yesterday that the country has achieved its goal of having 100% of newly produced vehicles be electric, and that it will therefore be eliminating subsidies over the next two years.
Fully electric vehicles accounted for 98.3% of sales last month, according to Reuters.
Still, the Norwegian EV Association criticized the move as “hasty,” noting that seven out of 10 cars on the road are still gas-powered.
INDIA DOWNPLAYS TRUMP SUGGESTION THAT MODI PLEDGED NO RUSSIAN OIL: The government of India is trying to gently turn away Trump’s claim yesterday that Prime Minister Narendra Modi told him yesterday that India would stop buying Russian oil, it seems.
Why it matters: As part of its efforts to limit Vladimir Putin’s funding for Russia’s war in Ukraine, the Trump administration has put pressure on India to decrease its purchases of Russian oil – including via “secondary tariffs.” Those measures are novel diplomatic tools, with major ramifications for world markets.
What Trump said: “There will be no oil. He’s not buying oil,” Trump said of Modi while speaking at the White House yesterday. He said the change would happen “within a short period of time.”
India’s response: India’s foreign ministry told the BBC that it was not aware of such a phone call between Trump and Modi.
It also told the outlet that “Our consistent priority to safeguard the interests of the Indian consumer in a volatile energy scenario. Our import policies are guided entirely by this objective.”
RUNDOWN
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