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NEW EFFICIENCY STANDARDS: Automobile manufacturers will have to step up their game and make big improvements to fleet-wide fuel efficiencies under new standards announced today.
The National Highway Traffic Safety Administration issued “Corporate Average Fuel Economy” standards requiring passenger cars and light trucks to achieve an average 49 miles per gallon economy for all new makes beginning in model year 2026.
NHTSA’s standards also require average fuel efficiency to increase 8% annually for model-years 2024 and 2025 for the same vehicle types and 10% annually for model-year 2026.
The agency pitched the standards as supportive of President Joe Biden’s climate change goals by limiting the nation’s reliance on fossil fuels and reducing greenhouse gas emissions and pollution.
Transportation Secretary Pete Buttigieg said that the rule would stop 5.5 trillion pounds of carbon dioxide from entering the atmosphere through mid-century and said it will make getting around more affordable for those struggling with high gasoline prices.
“When you can afford to get to work everyday, when you can afford to bring your family to a movie, or an event or something a few counties away, you are better able to do so thanks to the increased affordability that comes with better fuel efficiency,” he said in announcing the rule.
It’s a little soon for reactions to the rule, so we’ll cover some of those in Monday’s newsletter, but there was some early commentary.
Jamal Raad, executive director of Evergreen Action, said the new standards “will move us one step closer to cleaning up the most polluting sector of our economy,” but pressed the administration to do more to build more zero-emissions vehicles.
Biden’s moving on that, too: Biden said in remarks yesterday announcing he is invoking the Defense Production Act to produce more critical minerals domestically that the U.S. needs to reduce dependence on more than fossil fuels.
“We need to end our long-term reliance on China and other countries for inputs that will power the future,” he said.
Welcome to Daily on Energy, written by Washington Examiner Energy and Environment Writers Jeremy Beaman (@jeremywbeaman) and Breanne Deppisch (@breanne_dep). 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.
EPA UPHOLDS TRUMP-ERA DECISION ON DRINKING WATER CONTAMINANT: The EPA said it will uphold a Trump-era decision not to regulate the drinking water contaminant perchlorate, which may be tied to fetal brain damage. In a statement released yesterday, the EPA said its 2020 decision not to regulate the chemical––which is used in rocket fuel and fireworks––was based on the “best available peer reviewed science.” The Biden administration ordered a review of that decision shortly after the start of his term.
The EPA has estimated that more than 600,000 people may be consuming water with a perchlorate concentration that exceeds its “levels of concern.”
RUSSIAN NATURAL GAS STILL FLOWING TO EUROPE: Russian gas remained flowing to Europe today, even after Russian President Vladimir Putin’s deadline passed for “unfriendly” nations to be cut off from Russian gas supplies unless they began paying for them in rubles –– a demand that was staunchly rejected by the West.
The official decree Russia passed one day earlier was also less stringent than Putin’s remarks, and gave Russian authorities, as well as the Russian financial institution, Gazprombank, 10 days to make necessary arrangements for the changes. It also allows countries to make payments in their normal currencies to the bank, which will then transfer them to rubles.
Russian officials also sought to hedge Putin’s remarks today, including Kremlin spokesman Dmitry Peskov, who said, “payments on shipments in progress right now must be made not this very day, but somewhere in late April, or even early May.”
Don’t forget the contracts: The EU-Russia gas relationship is etched in long-term contracts which govern flows and payments, and European leaders and analysts have insisted the gas-for-ruble demand, especially if acted upon, constitutes a breach.
“Putin’s demand that they pay in rubles constitutes a breach of contract,” said Jonathan Stern of Oxford University’s Center for Energy Studies, who was EU Speaker for the EU–Russia Gas Advisory Council between 2011 and 2016. “The next question is: if buyers refuse to pay in rubles will he cut off the gas. If yes, and if such interruptions are long term, this would constitute a breach by the Russian side and eventually result in an exit from the contracts and damages to be paid by Gazprom.”
The Europeans have notably made clear they want out of the contracts, pledging to cut Russian gas imports by two-thirds by year’s end — but, they want to do it on their own terms, which would not support an immediate shutoff.
Stern emphasized, too, that breaches can go both ways, and that Europe’s decision to reduce imports also transgresses contract terms.
He told Jeremy the two-thirds commitment “would also constitute a breach of the take or pay clauses in the long term contracts from the European side, resulting in similar damages to be paid by Europeans.”
SWEEPING CLIMATE CHANGE BILL ADVANCES IN MARYLAND: Maryland lawmakers voted yesterday to pass a sweeping energy and climate change bill––seeking to put the state on a path to achieving some of the most aggressive environmental goals in the country.
The bill is meant to cut Maryland’s emissions by 60% of 2006 levels by the year 2031––a 20% increase from its current goal––and to achieve net-zero greenhouse gas emissions by 2045.
As E&ENews reports, the legislation would also direct the Maryland Public Service Commission and its Building Codes Administration to “study and make recommendations on the electrification of buildings in the state” by the end of 2023. The bill also includes provisions that would “compel electric utilities to expand existing energy efficiency and conservation programs, create new requirements for monitoring methane emissions from landfills, and require school boards to purchase electric school buses beginning in fiscal year 2025.”
The legislation now goes to the desk of Gov. Larry Hogan. Hogan, a Republican, threatened last month to veto the bill, which he characterized as a “reckless and controversial energy tax.” But Sen. Paul Pinsky, a Democrat from Prince George’s County and the bill’s chief architect in the Senate, said he believes it has enough support to override a potential veto.
SENATORS CALL FOR ACTION ON LNG EXPORTS: Sens. Kevin Cramer and Chris Coons are calling on Biden to ramp up U.S. exports of liquefied natural gas. The pair said in a letter this morning that boosting America’s LNG exports––which emit less methane than Russian gas and has a lower carbon footprint, would have the “dual benefit of reducing global greenhouse gas emissions while diminishing the leverage of bad actors.”
They also called on Biden to prioritize trade policies that would help lower global emissions, such as implementing a carbon border adjustment mechanism, warning that failure to do so could leave the U.S. behind, especially as the EU moves ahead with efforts to implement its own border carbon adjustment mechanism.
“[W]e are concerned that unilateral action could lead to discrimination against U.S. businesses, driving a wedge where there should be a bond,” they wrote, adding that the U.S. now has the “opportunity … to coordinate with other countries who share our commitment to environmental stewardship. Russia’s war in Ukraine has underscored the need for close cooperation with nations who share our values. It is time to stop rewarding cheap, dirty products that increase emissions and the geopolitical leverage of despots.”
FERC ISSUES IMPACT STATEMENT FOR NEW LNG PROJECT: The Federal Energy Regulatory Commission concluded that most environmental impacts associated with Commonwealth LNG’s proposed liquefied natural gas project would be mitigated but that there would be “significant impacts on visual resources and environmental justice communities.”
FERC issued an environmental impact statement yesterday for the Cameron Parish, Louisiana-based project, which would build a terminal able to produce 8.4 million metric tons of LNG per year.
A 1.44 billion cubic feet per-day pipeline for feeding gas into the liquefaction terminal is also part of the proposal.
FERC emphasized that the analysis did not include a characterization of the significance of Commonwealth LNG’s greenhouse gas emissions because it’s reconsidering the methodology and application of its recent policy statements.
The pressure is on: FERC Chair Richard Glick acknowledged in its decision to pull back on its emissions and pipeline policy statements and redesignate them as drafts that the statements “created confusion.”
Glick said the commission would accept public input to create greater certainty for project developers, whose allies in Congress, on the Commission, and in trade groups sharply criticized the policies.
Republicans and industry have been adamant that FERC, the Department of Energy, and other agencies responsible for reviewing and approving projects need to act more quickly and to reduce hurdles for developers in order to meet allies’ energy needs.
OVERSIGHT GOP WANTS PROBE INTO RUSSIA FUNDING GREENS: House Oversight Republicans want Chairwoman Carolyn Maloney to call a hearing and lead a committee investigation into what extent Russia has funded anti-fracking environmentalist NGOs.
Committee Republicans in a letter sent to Maloney yesterday quote testimony from Fiona Hill, a former National Security Council official, who pledged that Putin viewed fracking as a threat to Russia’s energy sector.
They also note former NATO secretary-general Anders Rasmussen having said that insiders told him Russia engaged with NGOs to discredit fracking.
Signatories asked for an immediate hearing to consider NGOs “financial ties to Russia and their willingness to push foreign propaganda that interferes with U.S. energy policies and interests.”
The Rundown
E&E News Europe’s scramble for LNG leaves Asia starving for energy
AP High energy costs are hitting UK. It’s about to get worse
Calendar
TUESDAY | APRIL 5
10:00 a.m. 1324 Longworth The House Natural Resources Subcommittee will hold a hearing examining efforts to use bipartisan infrastructure funds for federal wildfire management and ecosystem restoration.
WEDNESDAY | APRIL 6
10:00 a.m. Dingell 2123 The House Energy and Commerce Committee will hold a hearing with six oil company executives titled, “Gouged at the Gas Station: Big Oil and America’s Pain at the Pump.”
