SIGN UP! If you’d like to continue receiving Washington Examiner’s Daily on Energy newsletter, SUBSCRIBE HERE: http://newsletters.washingtonexaminer.com/newsletter/daily-on-energy/

COAL COULD BE TRUMP’S WILD CARD IN NORTH KOREA TALKS: President Trump goes into the talks in Hanoi with no apparent bargaining chips when it comes to energy, except perhaps one: Coal.

North Korea’s economy depends on coal exports, but crippling United Nations sanctions have cut back its shipments to China — its largest buyer — to zero.  

That means that Trump has the option of a concession related to coal in reaching a deal with North Korea to give up its nuclear ambitions.

If Kim Jung Un renounces his pursuit of weapons of mass destruction, he gets his coal trade back with China, and perhaps some exchange of expertise between the U.S. Energy Department and Pyongyang.  

Trump could also look to patch up the country’s ailing electricity grid through this exchange, or facilitate discussions with American engineering and electricity firms to help rebuild its grid.

The Energy Department has been promoting U.S. energy expertise abroad as part of Trump’s energy dominance agenda, while also touting natural gas exports to countries throughout Asia.

U.S. has been stealing Kim’s lunch: Since the U.N. Security Council tightened its sanctions on coal around the time Trump was calling Kim the “little rocket man,” U.S. coal exports to China – Pyongyang’s main trading partner – doubled. In fact, U.S. coal exports rose by over 60 percent across Asia in 2018.

U.S. coal exports are supposed to wane in the next two years, and with Trump focused on natural gas more and more, giving North Korea some room to compete in the Asian market wouldn’t hurt U.S. energy firms that much.

First things, first: But any investment in North Korea will have to be followed by the U.N. ending its crippling sanction’s on Kim’s economy.

South Korea will likely play a major role once sanctions are lifted in beginning an investment dialogue with the North.

Sanctions work? When President George W. Bush wanted to get North Korea’s attention about its nuclear weapons program, he often sought to block its shipments of heating oil.

Bush had threatened to stop financing oil shipments called for under a 1994 arms agreement after North Korea’s nuclear testing resumed in 2002 under Un’s father, Kim Jung-Il. Later, the Bush administration relied on regional allies like Japan and South Korea to find a middle ground and avoid unnecessary punitive actions.

But nearly 20 years later, Trump is in the position of offering more carrots than sticks on the energy front.  

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.  

EPA PLAYS DEFENSE OVER LOW ENFORCEMENT NUMBERS FOR POLLUTION VIOLATIONS: The Trump administration’s Environmental Protection Agency defended criticism Tuesday from Democrats and environmentalists over declining enforcement numbers by agency inspectors of pollution violations from industry.

A report issued by the EPA earlier this month showed it enforced $69 million in civil penalties against polluters in 2018 fiscal year, the lowest number since the agency created its enforcement office in 1994.

EPA also conducted 10,612 site inspections in 2018, also the lowest figure since 1994.

“There is no doubt the Trump EPA’s enforcement record is abysmal — the worst in decades,” said Rep. Frank Pallone of New Jersey, the chairman of the Energy and Commerce Committee, in a hearing on the subject Tuesday.

Pallone and Rep. Diana DeGette, D-Colo., charged the EPA has downplayed enforcement of polluters under Trump, and has dedicated less agency staff to do the job. They noted EPA’s office of enforcement experienced a 17.8 percent decline of its staff over the last two years.

EPA seeks a broader picture: EPA’s top enforcement official Susan Bodine defended the agency’s record, saying critics are judging its work based on a “narrow set of parameters.”

She said claims that Trump’s EPA does not care about compliance with the law are “absolutely not true” and “discredits the tremendous work of our staff.”

“I am pushing back on these myths about our enforcement program,” Bodine said in testimony before the committee. “Enforcement is a critical tool but not an end to itself.”

Bodine, and Republican lawmakers who defended her, said enforcement actions take years and some of the agency’s work cannot be reflected in a year-to-year total. There have been steady declines in federal inspections dating back to 2012, noted the committee’s top Republican Rep. Greg Walden of Oregon, because of budget cuts at EPA authorized by Congress.

There has also been an increase in self-reports by industry of violations under the Trump administration, Bodine and Walden noted, underscoring EPA’s focus on working more collaboratively with entities it regulates.

For example, the EPA has created a new program for oil and natural gas producers that offers to relax penalties on those who self-audit their emissions and report violations of agency regulations.

Bodine, however, conceded self-compliance has limited utility and is not “appropriate for the worst offenders.”

“We absolutely do need to keep inspecting to create the incentive [to follow laws and regulations],” she said.

SCHUMER TO INTRODUCE BILL DEFUNDING TRUMP’S ‘FAKE CLIMATE PANEL’: Senate Democratic leader Chuck Schumer of New York said Tuesday he plans to introduce a bill to defund the Trump administration’s “fake climate panel” should the White House move forward with it.

The White House is preparing to create a working group that is meant to challenge the scientific consensus regarding climate change. It has not finalized the plan, and is planning to convene more meetings on the subject.

HOW THE ‘GREEN NEW DEAL’ AIMS TO SUPPORT MINERS, WHILE KILLING COAL: Supporters of the “Green New Deal” say they can reconcile two conflicting goals: Ending the use of coal and other fossil fuels while also supporting coal miners.

Progressive Green New Deal advocates say they plan to visit Appalachian coal communities — potentially hostile territory for them — in the coming months in order to sell them on trading coal for federal dollars, clean energy, and infrastructure jobs.

“You overcome the perception about the Green New Deal by engaging in conversation on where they see themselves in the energy transition,” Greg Carlock, Green New Deal research director at the progressive think tank Data for Progress, told Josh. “You honor the culture and the role coal communities have played in making the American economy a strong, energy-rich country.”

The pitch to help coal miners: Carlock envisions a suite of federal programs to help coal communities change their way of life. He sees the Green New Deal providing job training and workforce development programs in addition to interim assistance such as unemployment benefits, mortgage relief, child care aid, and healthcare, as well as shoring up miners’ pension funds. The Green New Deal explicitly offers a federal jobs guarantee for those working on the energy transition.

Mining groups push back: But the leaders of coal groups naturally oppose any government-mandated plan to kill the industry.

Mike Cope, president of the Ohio Coal Association, said his group would not reject outreach from Green New Deal supporters promising to help coal communities, but he prefers the government find ways to subsidize coal with higher payments to keep plants alive.

“We are always willing to engage people who want to learn,” Cope told Josh. “We would never turn our back on something like that. But I doubt they would change their opinion. They are wrong. The coal industry is not dead.”

Read more of Josh’s story in this week’s Washington Examiner magazine.

TOP INFRASTRUCTURE COMMITTEE REPUBLICAN CALLS FOR ‘REAL’ CLIMATE SOLUTIONS: Rep. Sam Graves of Missouri, the top Republican of the House Transportation and Infrastructure Committee, criticized the Green New Deal’s “fairy tale” approach to infrastructure policy Tuesday.

Graves, speaking at a hearing on climate change and infrastructure policy, said the Green New Deal resolution’s emphasis on high-speed rail is misplaced, citing California’s decision to scale back its plan to connect San Francisco and Los Angeles

He said Congress should focus on more bipartisan issues, and promote public-private partnerships. He touted recent achievements in the infrastructure committee to, among other things, establish an Federal Aviation Administration partnership with industry for developing low-emission technologies. A recently passed water infrastructure bill, meanwhile, provides funding to ecosystem restoration, flood risk reduction, and storm risk reduction projects, he said.

“Infrastructure is an issue where we can find common ground and bipartisan agreement on real world solutions,” Graves said.

CENTER-RIGHT GROUP PROJECTS GREEN NEW DEAL TO COST UP TO $93 TRILLION: A center-right think tank projected Monday Green New Deal would cost up to $93 trillion over 10 years.

The American Action Forum, led by Douglas Holtz-Eakin, former director of the nonpartisan Congressional Budget Office, said in a report the proposal would cost between $51 trillion and $93 trillion over 10 years.

In comparison, total government spending over the next 10 years is projected to total less than $60 trillion, according to the Congressional Budget Office.

SEC SEEKS CONTEMPT FILING AGAINST TESLA’S ELON MUSK: The Securities and Exchange Commission asked a federal judge Monday to hold Tesla founder Elon Musk in contempt, arguing that a Twitter post forecasting the electric carmaker’s 2019 sales violated a settlement late last year.

Not only did Musk fail to get pre-approval for the Feb. 20 post as required under the deal ending an SEC lawsuit, his claim that the Palo Alto, Calif.-based company would build 500,000 cars this year was incorrect, the agency said in court papers filed in U.S. District Court in Manhattan.

About four hours after the initial 7:15 p.m. tweet, Musk clarified that “annualized production” would reach 500,000 vehicles by year’s end but the company would actually deliver about 100,000 fewer vehicles than that. The figures, available to Musk’s more than 24 million Twitter followers as well as anyone else with Internet access, bear heightened relevance to Tesla investors because of the company’s ongoing effort to boost output enough to consistently turn a profit.

EPA KEEPS SULFUR DIOXIDE RULES THAT PRUITT SIGNED OFF ON: After nearly a year of deliberations, the EPA announced Tuesday that it will be keeping in place a rule first proposed by the Obama administration to curb deadly sulfur dioxide pollution.

The sulfur dioxide standards are part of the national ambient air quality standards program, a cornerstone of EPA’s air pollution control regime.

Former EPA chief Scott Pruitt had proposed keeping the standards in May of last year, about two months before he resigned amid a number of ethical indiscretions that were under investigation.

Under Pruitt, the administration was taking stock of all programs under the EPA ambient air program to identify what was working and what required changes.

EPA air chief Bill Wehrum said the U.S. has made great strides in reducing SO2 levels, and based on review of the scientific literature, recommendations from independent science advisors, and public comment, “we have concluded that the existing standard continues to provide adequate health protection to our most vulnerable populations.”

EPA SENDS $202 MILLION IN LOANS TO BALTIMORE: The EPA announced on Monday that it would be sending $202 million to Baltimore, Md., to help the city update its aging wastewater infrastructure.

EPA Administrator Andrew Wheeler joined Maryland Democratic Sens. Ben Cardin and Chris Van Hollen in making the announcement.

The EPA loan program that made the funding possible has been a target for cuts by the Trump administration, which lawmakers have successfully blocked in subsequent spending bills.

Baltimore Mayor Catherine Pugh was also present at yesterday’s funding release, along with Maryland Department of the Environment Secretary Ben Grumbles, Baltimore County Executive John A. Olszewski Jr., Baltimore City Department of Public Works Director Rudolph Chow, and EPA Mid-Atlantic Regional Administrator Cosmo Servidio.

MORE THAN 100 GLOBAL FINANCIAL INSTITUTIONS HAVE RESTRICTED COAL FUNDING, REPORT SAYS: More than 100 major global financial institutions introduced policies to restrict coal funding between 2013 and 2018, according to a report released Tuesday.

A report from the Institute for Energy Economics and Financial Analysis found that since the start of 2018, there have been 34 new or “significantly improved” announcements from global financial institutions restricting lending to coal.

The 100-plus financial institutions restricting coal lending includes 40 percent of the top 40 global banks. It also includes at least 20 insurers with more than $6 trillion of investments – 20 percent of the industry’s global assets, the report said.

DEMOCRATS RECRUIT FORMER NRDC STAFFER TO DIRECT CLIMATE COMMITTEE: House Democrats leading a new select climate change committee announced Tuesday they hired Ana Unruh Cohen, who leads government affairs for the Natural Resources Defense Council, to be the committee’s staff director.

Rep. Kathy Castor, D-Fla., the chairwoman of the Select Committee on the Climate Crisis, said she also hired Alison Cassady of the Center for American Progress  as deputy staff director.

In addition to working for NRDC, Cohen was previously policy director of climate and energy for Sen. Ed Markey, D-Mass.

Cassady worked for former Rep. Henry Waxman, D-Calif., who worked with Markey on the failed cap-and-trade bill in 2009.

“Ana Unruh Cohen and Alison Cassady are experienced climate professionals who will launch the Select Committee’s work and build a dynamic staff to work with me and my colleagues to press for urgent action to dramatically reduce greenhouse gas emissions and build an equitable clean energy economy with a qualified workforce and a just transition,” Castor said.

RUNDOWN

E&E News Power lines: The next Green New Deal battlefront?

New York Times Burned by Russia, Poland turns to US for natural gas and energy security

Wall Street Journal Saudis likely to push to maintain output cuts despite US pressure

Washington Post Very high carbon dioxide could suppress cooling clouds, climate change model warns