Daily on Energy: Utilities rally to stop Trump privatization proposal a third time

“The Hill consistently turns this idea away for a reason: It’s bad policy,” Desmarie Waterhouse, vice president of government relations for the American Public Power Association, tells John.

Her group represents publicly-owned utilities throughout the U.S. and tens of millions of customers that rely on the federal power authorities’ transmission assets being targeted in the budget.

The federal power utilities, including Bonneville Power Administration, Southeastern Power Administration, Southwestern Power Administration, Tennessee Valley Authority, and Western Area Power Administration, are all APPA members. All are targeted by the budget.

The basic argument against the proposal is that privatizing the transmission lines operated by these large federal power authorities will drive up costs for consumers by basing their operations on profits, rather than the public interest.

Many of the federal power companies like Bonneville and the Tennessee Valley Authority cover large stretches of rural areas, which private firms have traditionally avoided due to low numbers of customers and lack of revenue potential.

Also, these government power companies, although federally owned, do not rely on taxpayer dollars to run their operations. They are run just like any company, except their goal is to provide low-cost power while maintaining operations and investing in infrastructure to better serve its customers, say officials.

Almost immediately after the budget was proposed, APPA and the National Rural Electric Cooperative Association, two of the three largest utility groups representing the power sector, sent a letter to the White House laying out the problems with continuing to propose the privatization scheme.

The administration’s budget argues that “ownership of transmission is best carried out by the private sector where there are appropriate market and regulatory incentives,” which the utility groups say is not based in fact. “These arguments are merely a pretext for actions that would raise electricity costs for millions of people and businesses nationwide, many of whom can least afford it,” the letter from the groups read.

Waterhouse tells John that the administration hasn’t responded.

Battle lines drawn this week on Capitol Hill: With no response from the White House, lawmakers began to pounce on administration officials at this week’s several budget hearings. Sen. Ron Wyden, D-Ore., scolded Energy Secretary Rick Perry on Tuesday before the Energy and Natural Resources Committee, vowing to make sure the policy is killed off and does not return a fourth time.

Wyden wants Perry to put his foot down and “stop the administration from putting forth such a proposal again,” a Wyden aide tells John.

Wyden is particularly concerned with selling off the Northwest’s Bonneville Power Administration’s assets, which is one of the largest federal utilities overseen by the Energy Department.

Perry suggested this line item will end up as it did the other two times it was proposed. But he would not say he would oppose the plan, as Wyden wished. Instead, Perry said the decision rests with lawmakers.

Wyden vowed to “make sure it ends up on the cutting room floor,” while also saying he will be watching Perry to ensure he does not revive it.

Welcome to Daily on Energy, written by Washington Examiner Energy and Environment Writers John Siciliano (@JohnDSiciliano) and Josh Siegel (@SiegelScribe). Email [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.

MURKOWSKI SAYS EPA CUTS DON’T FIT WHEELER’S ‘BACK TO BASICS’ AGENDA: Sen. Lisa Murkowski, R-Alaska, Wednesday warned Environmental Protection Agency Administrator Andrew Wheeler that the fiscal 2020 budget, as proposed, won’t survive congressional scrutiny.

“Many of the cuts, in my view, would be inconsistent with the ‘Back to Basics’ approach” of the agency, she said in chairing a budget hearing of the Appropriations Committee’s environmental subcommittee.

She objected to the proposed cuts to many of EPA’s state revolving funds, which communities rely upon to support drinking water projects and sanitation infrastructure.

“While I do understand the tough budget environment this proposal was crafted in, the final budget for EPA as crafted by Congress will look substantially different,” Murkowski said.

Murkowski said several key programs that have reduced pollution in Fairbanks and other communities in her state are completely eliminated in the new budget.

ACTIVISTS PLAN TO OPEN DC AUTO SHOW BY DENOUNCING FORD’S EMISSIONS: The consumer watchdog Public Citizen and environmental activist group Sierra Club will bring confrontation to this week’s Washington Auto Show on opening day — denouncing major automaker Ford for supporting Trump’s deregulation agenda.

“As the auto world gathers in Washington, D.C., for the 2019 auto show, public interest groups – including consumer, health, faith and environmental organizations — will host a press conference to denounce Ford Motor Company’s lobbying of the Trump administration to roll back fuel economy and greenhouse gas emissions standards, popularly known as the clean car standards,” read a notice ahead of Thursday’s demonstration.

The groups will feature a 10-foot inflatable dinosaur and demonstrators prancing around in dinosaur costumes, symbolizing Ford’s “outsized” pollution from its desire to build more SUVs.

The annual greenhouse gas emissions from one of the company’s Expedition SUVs — 9 tons — is the equivalent of the weight of a Tyrannosaurus rex.

MANUFACTURERS PROTEST NATURAL GAS EXPORT PROPOSAL BEFORE ENERGY DEPARTMENT: The Industrial Energy Consumers of America, representing large natural gas users like Dow Chemical and Dupont, is protesting the Energy Department’s pending approval of a new export license to ship liquefied natural gas, saying the administration is not weighing the negative effects on manufacturers.

The large group argues the agency’s own export studies illustrate the “public does not benefit from excessive LNG exports and in fact, are damaged by them.” Only natural gas producers and exporters benefit, it adds in a document sent to the agency on Thursday requesting that its protests be recognized in the agency’s review of Magnolia LNG’s export license request.

The group is targeting the Energy Department’s public interest review of Magnolia LNG, a company looking to ship natural gas overseas. The Energy Department is required to do the review under the Natural Gas Act.

Approving more LNG exports, and expediting the process, is part of the administration’s “energy dominance” agenda, which the industrial consumer group says poses too many risks.

“If the DOE mismanages and approves high volumes of LNG exports, and U.S. manufacturers lose the competitive advantage, it puts trillions of dollars of manufacturing assets at risk, a sector with over 12.5 million high paying jobs,” read the group’s formal protest sent to the agency on Thursday.

SENATORS DEMAND ANSWERS FROM PERRY ON SAUDI NUCLEAR EXPORTS: Sens. Marco Rubio, R-Fla., and Bob Menendez, D-N.J., pressed Perry Tuesday to disclose specific details of a “secret” nuclear technology export agreement with Saudi Arabia.

“We are very concerned about the nuclear proliferation risk associated with the Kingdom’s nuclear program,” the senators said in a letter sent to Perry, requesting specific information on seven export licenses approved by Perry and first revealed last week.

SEC DISMISSES INVESTOR BID FOR EXXON TO DISCLOSE EMISSIONS TARGETS: The Securities and Exchange Commission dismissed an investor resolution on Tuesday that would have pushed ExxonMobil to disclose greenhouse gas emission reduction targets aligned with the goals of the Paris climate change agreement.

The SEC, in a letter obtained by Axios, agreed with Exxon’s position that the resolution would unfairly “micromanage” the oil and gas company’s affairs by “seeking to impose specific methods for implementing complex policies.”

The New York public pension fund and Church of England’s endowment, investors in Exxon,had filed the resolution urging the company to be more transparent and aggressive in combating climate change.

Big day for shareholder activism: SEC’s decision capped a mixed bag day for shareholder climate activism. Earlier Tuesday, European oil and gas giant Shell announced it is leaving a major industry lobbying group, American Fuel & Petrochemical Manufacturers, because of the trade association’s inaction on climate policy.

Shell acted after it reached an agreement last year with activist shareholder groups to set short-term carbon emissions reduction targets. As part of that agreement, Shell conducted a review of its membership in trade associations to ensure they don’t “undermine” the company’s support for the objectives of the Paris agreement.

INTERIOR’S BERNHARDT FACES FRESH SCRUTINY AHEAD OF CONFIRMATION VOTE: Campaign for Accountability, a watchdog group, has received confirmation that the Interior Department’s inspector general office is reviewing its request to investigate allegations that Acting Secretary David Bernhardt violated his ethics pledge to help a former client.

The complaint focuses on Bernhardt’s previous lobbying work for California’s Westlands Water District, which would benefit from his effort at Interior to push the state to divert more of its water from conservation to agricultural interests.

In August of last year, when Bernhardt became Interior’s deputy secretary, he signed an ethics letter saying he would recuse himself from policy decisions that specifically specific former clients.

But critics say he has interpreted recusal decisions narrowly, and acted in ways that benefit broad industries he represented.

Bernhardt’s confirmation vote is this week: Interior’s review of the ethics complaint comes before the Senate Energy and Natural Resources Committee is scheduled to hold a confirmation vote Thursday for Bernhardt to stay on leading the agency after he replaced Ryan Zinke as secretary on an acting basis.

Washington Gov. Jay Inslee, a 2020 Democratic presidential candidate, told the committee Wednesday to delay the vote “until these serious ethical violations are thoroughly investigated by the inspector general.”

NATIONAL MINING ASSOCIATION CEO HAL QUINN ANNOUNCES RETIREMENT: National Mining Association CEO Hal Quinn announced Wednesday morning he is retiring at the end of 2019. Quinn has led the coal mining trade group for 11 years, the longest tenure of any of the association’s previous CEOs.

“It has been a privilege to lead an organization representing and promoting one of America’s most vital industries,” Quinn said.

Phil Baker, chairman of the National Mining Association’s board of directors, credited Quinn for being a “forceful advocate through times of great challenge” as coal has suffered greatly over the last decade, losing market share to natural gas and renewables. The association has retained the firm Lochlin Partners to lead a search for Quinn’s successor.

The Rundown

Bloomberg The biggest Saudi oil field is fading faster than anyone guessed

Washington Post What remains of Bears Ears after Trump shrunk it

Reuters Why some green investors are passing on Uber and Lyft

Quartz How CATL became the world’s largest EV battery company

Calendar

WEDNESDAY | April 3

All day, The hydro-electric industry holds its annual policy conference Waterpower Week.

Noon, 1320 19th Street NW. The Women’s Council on Energy and the Environment (WCEE) holds a discussion on “Marine Mammal Protection in an Era of Expanded Ocean Development.”

2:30 p.m., 138 Dirksen. The Senate Appropriations Committee’s Energy and Water Development Subcommittee holds a hearing on the proposed budget estimates and justification for FY2020 for the National Nuclear Security Administration. Energy Undersecretary for Nuclear Security Lisa E. Gordon-Hagerty, administrator of the National Nuclear Security Administration testifies, along with other senior officials.

THURSDAY | April 4

8:30 a.m., The Washington Auto Show holds media and policy day with EPA and Energy Department.