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THE LATEST: President Joe Biden is meeting today with leaders of a bipartisan group of 21 senators who say they’ve reached an agreement with White House staff on the framework of a “hard” infrastructure bill.
But climate activists oppose passing the bipartisan measure, which contains $559 billion in new spending including some climate provisions, unless all Democrats agree to passing a bigger “climate, jobs, and justice” reconciliation package at the same time.
Democratic leaders Chuck Schumer and Nancy Pelosi are promising to do just that, but so far have been unable to convince key centrists like Joe Manchin to back a reconciliation bill nobody has seen yet.
“One can’t be done without the other. All of us agree to that,” Schumer told reporters yesterday, perhaps overstating the level of support in his party for that sequencing. “We can’t get the bipartisan bill done unless we’re sure of getting the budget reconciliation bill done. I think our members across the spectrum realize that.”
Pelosi is on the same page: “There ain’t gonna be no bipartisan bill unless we have reconciliation,” the speaker said on the House floor today.
“We will not take up a bill in the House until the Senate passes the bipartisan bill and a reconciliation bill,” Pelosi added. “If there is no bipartisan bill, then we’ll just go when the Senate passes a reconciliation bill.”
What about Manchin? He did not draw any specific red lines during an Energy Committee hearing he chaired this morning on draft legislation outlining his clean energy and climate priorities.
But Manchin, in comments to reporters before the hearing, warned about moving reconciliation at the same time.
“It doesn’t seem to be fair to me, but they’re gonna make those decisions,” Manchin said of Democratic leadership. “But we have to see what’s in the other plan before I can say ‘Oh yes, you vote for this and I’ll vote for that.’ That’s not what I have signed up for.”
Manchin at the hearing touted his proposals, which avoid thornier issues like a clean electricity standard and tax credits in favor of “addressing climate through innovation” by funding more than a dozen clean energy demonstration projects originally authorized under the Energy Act of 2020 approved at the end of last year.
His draft legislation mirrors some of the clean energy and climate provisions we reported are a part of the broader bipartisan framework, but he also could lobby for some of it to be included in the larger reconciliation package.
Republicans are leery: Sen. John Barrasso, the Energy committee’s top Republican, warned Manchin against grooming his plan to be used as part of reconciliation.
Barrasso praised elements of the Manchin plan, such as its funding for advanced nuclear and carbon capture demonstration projects, but said it spends too much overall and failed to incorporate Republicans in its drafting.
“The draft leaves open critical questions,” Barrasso said. “Will this bill be incorporated into Majority Leader Schumer’s partisan reconciliation process or will it go by regular order?”
Barrasso is not part of the bipartisan negotiating group, but he is close to Majority Leader Mitch McConnell, whose blessing is crucial to attracting enough Republican votes for the “hard” infrastructure measure to pass.
Outstanding questions: It remains to be seen whether the Senate, let alone the House, can cobble together enough votes for either approach.
While liberals demand a two-track concurrent process in order to vote for the bipartisan bill, we question whether Republicans would back the compromise plan while knowing a bunch of stuff they oppose will move through reconciliation at the same time.
Welcome to Daily on Energy, written by Washington Examiner Energy and Environment Writers Josh Siegel (@SiegelScribe) and Abby Smith (@AbbySmithDC). Email [email protected] or [email protected] 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.
SENATE APPROVES MEASURE TO HELP FARMERS SELL CARBON CREDITS: Senators voted this morning by an overwhelming bipartisan margin to approve a bill to help farmers access voluntary markets to sell carbon credits.
The Senate voted 92-8 to approve the Growing Climate Solutions Act, advancing a rare bipartisan standalone climate bill even amid the squabble over broader, more aggressive climate provisions in infrastructure negotiations.
“Farmers and foresters are already leading the way on the climate crisis,” Senate Agriculture Committee Chairwoman Debbie Stabenow, a lead sponsor of the bill, said on the Senate floor ahead of the vote. She noted that farmers use conservation practices to reduce their emissions and increase their soil’s ability to store carbon.
The legislation doesn’t require anything of farmers but aims to break down barriers for them to participate in voluntary carbon markets, in which they would be rewarded for climate-friendly practices that help sequester carbon.
THE EU HAS A METHANE PROBLEM TOO: Methane is leaking from natural gas infrastructure across the European Union, the Clean Air Task Force documented using an infrared camera in a first-of-its-kind project.
The nonprofit group found leaks and venting of methane at 123 oil and gas sites in Austria, the Czech Republic, Germany, Hungary, Italy, Poland, and Romania this year. It spotted 271 incidents all together, with some sites leaking methane in several places.
The EU currently does not regulate methane in the energy sector, but the bloc this year is considering laws to require oil and gas companies to monitor and report methane emissions, and improve the detection and repair of leaks.
“Even as one person with an infrared camera, I’ve been able to find multiple leaks in every country I’ve visited. It begs the question – why aren’t the companies and national regulators doing this already?” said James Turitto, the campaign manager who has been filming the emissions for CATF.
Methane from oil and gas is Europe’s third largest source of greenhouse gas emissions. Combating methane would be key to the EU meeting its goal of cutting emissions 55% compared to 1990 levels by 2030.
SUPPLY GAP COULD LOOM, US OIL CEOS FEAR: U.S. oil and gas drilling in major shale basins continued growing strongly in the second quarter of this year as prices are rising from record lows during the pandemic, according to a Dallas Fed survey of 152 production and service companies.
But 76% of oil and gas executives surveyed expect there to be a global crude oil supply gap in the next two to four years due to underinvestment in new production.
One commenter to the survey remarked that U.S. producers cannot increase capital spending due to investors refusing to fund oil and gas production.
“This underinvestment coupled with steep shale declines will cause prices to rocket in the next two to three years,” wrote the anonymous executive.
Another executive said the Biden administration’s efforts to “curtail fossil fuel development” is creating a “larger gap” between supply and demand, causing an increase in oil prices and drilling activity.
BIDEN WADES INTO LINE 5 PIPELINE FIGHT: The Biden administration will scrutinize the environmental effects of a portion of the Line 5 crude oil pipeline in Michigan, wading into a long-waged battle by environmentalists and Gov. Gretchen Whitmer to shut down the pipeline.
The Army Corps of Engineers announced yesterday it will conduct an environmental impact statement for operator Enbridge Energy’s proposal to construct a tunnel and new pipeline to replace a portion of the current pipeline that runs under the Straits of Mackinac connecting Lake Michigan and Lake Superior.
Jaime Pinkham, the Army Corps’s acting assistant secretary for civil works, said the agency had determined an environmental impact statement was necessary “because of the potential for impacts significantly affecting the quality of the human environment.”
The Army Corps decision is a small victory for environmentalists and tribal groups who have long opposed the pipeline, as it could create further hurdles for Enbridge and place the pipeline under further scrutiny.
Whitmer, Michigan’s Democratic governor, ordered the entire 645-mile Line 5 pipeline operated by Canadian energy company Enbridge to shut down by May 12, citing risks that the pipeline could leak or spill oil any day. Enbridge has so far defied the shutdown order.
BIDEN BANS CERTAIN SOLAR IMPORTS FROM CHINA: The Biden administration is halting imports of certain products used in solar panels made in China’s Xinjiang region, in a step to counter Chinese forced labor practices and inhumane treatment of the country’s Uyghur Muslim minority.
The Customs and Border Patrol issued a withhold release order to bar the imports of silica-based products made by Hoshine Silicon Industry Co., Ltd., located in Xinjiang, and its subsidiaries. It is a significant step, as the Xinjiang region makes roughly half of the world’s supply of polysilicon essential for solar panels, according to Bloomberg.
“These actions demonstrate our commitment to imposing additional costs on the People’s Republic of China (PRC) for engaging in cruel and inhumane forced labor practices and ensuring that Beijing plays by the rules of fair trade as part of the rules-based international order,” the White House said in a statement this morning.
MASSACHUSETTS JUDGE KEEPS EXXON FRAUD CASE ALIVE: A Massachusetts state judge rejected motions from ExxonMobil asking for dismissal of a consumer fraud case Massachusetts Attorney General Maura Healey has brought against the oil giant.
“This is a big step for our work to hold Exxon accountable for lying about climate change to MA consumers and investors. We look forward to litigating our claims and stopping Exxon’s continued illegal deception,” Healey said in a tweet following the judge’s order yesterday.
The ruling brings the Massachusetts case one step closer to trial, and it is the first case of its kind to survive motions to dismiss, according to the Center for Climate Integrity. Exxon, along with other oil giants, face dozens of lawsuits brought by states, cities, and counties aiming to hold the companies liable for the costs governments have had to pay to adapt to climate change effects such as sea level rise and more extreme weather.
“This ruling shows that it won’t be easy for Exxon to escape justice in the growing number of lawsuits seeking to hold the company accountable for lying about climate change,” said Richard Wiles, executive director of the Center for Climate Integrity. Exxon faces similar consumer fraud lawsuits brought by the attorneys general of Minnesota, Delaware, Connecticut, and D.C.
CONSUMER ENERGY TO EXIT COAL BY 2025: The Michigan-based utility announced yesterday it would speed up its plans to stop using coal electricity by 15 years, to 2025, making it one of the first utilities to go coal-free.
Consumer Energy’s plan, submitted to Michigan utility regulators, includes the retirement of the utility’s three remaining coal-fired plants by 2025, several years before the end of their useful lives. Consumer Energy is also pledging to reach 90% clean energy by 2040, including the buildout of nearly 8,000 megawatts of solar power by that year.
Even so, Consumer Energy’s plan also proposes the purchase of four existing natural gas plants, which the utility says would help “ensure continued reliable, affordable energy” for its customers.
GREENS CAMPAIGN FOR BIDEN’S INFRASTRUCTURE PLAN: The Environmental Defense Fund announced a $2 million ad campaign this morning calling on Congress to “Go Bold” by passing Biden’s American Jobs Plan.
Ads will run in Arizona, Colorado, Georgia, Nevada, Florida, Iowa, Michigan and the District of Columbia through the end of August.
The Rundown
CapRadio Newsom misled the public about wildfire prevention efforts ahead of worst fire season on record
New York Times Wildfires threaten urban water supplies, long after the flames are out
Bloomberg UAE eyes first net zero by 2050 goal among major petrostates
Wall Street Journal New York City to install first curbside electric-vehicle charging station
Calendar
THURSDAY | JUNE 24
11 a.m. 2167 Rayburn. The water resources and environment subcommittee of the House Transportation and Infrastructure Committee will hold a hearing on Biden’s fiscal 2022 budget request. Tennessee Valley Authority CEO Jeff Lyash is among those testifying.
TUESDAY | JUNE 29
10:30 a.m. 2123 Rayburn. The House Energy and Commerce Committee will hold a hearing on the CLEAN Future Act and electric transmission.
