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CRAMER ON CLIMATE: Kevin Cramer has worked the hardest of anyone in Congress to lobby President Trump to act to counter the oil price crash battering the U.S. shale industry. But he’s also been an unlikely adviser pushing for the president to take climate change seriously.
The North Dakota Republican, 59, a talkative first-term senator who says he speaks with the president once a week on oil policy matters, was Trump’s energy adviser during the 2016 campaign.
After the campaign, as Trump deliberated over whether to pull the U.S. from the Paris climate agreement, Cramer recommended he stay in. Cramer did not get what he wanted, as is the case with some of his big requests of Trump on dealing with the oil crisis (see more on that below).
“Do I think it was a mistake?” Cramer told Josh in an interview Thursday. “If I thought it was the right decision, I wouldn’t have advocated for the other one. I don’t think it’s a fatal error. I just don’t like ceding our authority.”
Trump’s second chance: But Cramer said he is hopeful Trump would re-engage in the Paris agreement if he wins re-election, by submitting a lower carbon reduction target than what the Obama administration sought.
The U.S. plan, submitted in 2015, set the goal of reducing greenhouse gas emissions by 26% percent to 28% by 2025. China and India, the two other largest emitters, had much more lax targets.
“I completely understand why [Trump] wanted to get out of it,” Cramer said, noting the U.S. contribution was “disproportionate.”
The U.S. cannot formally exit from the Paris Agreement, coincidently, until the day after the 2020 presidential election, under the United Nations’ rules for withdrawal.
“We are leaders,” Cramer said. “The reason I thought we should stay in there is we could drive it better from being at the table.”
Climate policy on ‘our terms’: Cramer has taken other surprising positions, including entertaining the idea of a carbon tax (although he isn’t endorsing the policy). For example, he’s floated the concept of using the proceeds of a carbon tax to help fossil fuel companies pay for carbon capture projects.
“When I talk about a carbon tax or fee it would be paid by carbon emitters but also invested by them,” Cramer said. “The reason I like having the discussion on the table is much like Paris it’s hard to do the art of possible if you aren’t willing to talk about everything.”
He said other ideas floated by Democrats are “worse” than a carbon tax, but Republicans haven’t endorsed the idea of a carbon tax, as some big oil companies have, because Trump won’t.
“The president has been so adamantly opposed to it, it has kept Republicans from having a serious discussion,” Cramer said.
Cramer said he’s used his platform in the past with Trump to encourage him to tackle climate change. The timing isn’t right now, with the immediate economic policy response front-and-center, but Cramer says he will still be heard.
“One of things I told the president when he asked me about my position on climate is I said it doesn’t matter. People want us to deal with it. The question is: Do we deal with it on our terms or walk away from it?” Cramer said.
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.
THE OTHER SIDE…CRAMER CLAIMS PROGRESS IN PROTECTING OIL INDUSTRY: Despite Trump not delivering most of the measures he called for, Cramer is giving the president credit.
“We threw it all out there, realizing we wouldn’t get it all,” Cramer said in the first part of Josh’s interview posted this morning. “To the president’s credit, he let everything be on the table.”
“There is nothing like $10 oil to make $30 oil look good,” Cramer added. “I have been a little surprised it has come back as quickly as it has.”
Trump hasn’t imposed tariffs on Saudi oil or stopped an armada of tankers from coming here, as Cramer wanted. But that wasn’t the point: “The goal was always to change behavior. We succeeded in that,” Cramer said, crediting the Saudis for coming through “pretty big” with their production cuts.
Cramer is not totally ready to celebrate the recent oil price rally. He’s worried some producers could be tempted to restore wells they shut down prematurely while demand experiences ups and downs. “Hopefully, they won’t come back too fast and shoot themselves in the foot,” Cramer said.
HOUSE REPUBLICANS SAY TRUMP HAS THEIR BACK ON CRITICAL MINERALS BILL: House Republicans claimed Thursday their new critical minerals legislation targeting China’s dominance of the clean energy supply chain would be well received by Trump despite his skepticism of renewables.
“Because he is America first, he wants to make sure America has resources for clean technology,” said Rep. Paul Gosar of Arizona, a co-sponsor, in response to a question from Josh on a press call. “This fits in lock step with the president.”
Republicans also said Trump agrees with them on the need to check China for its handling of the pandemic. Trump has recently blamed China for the coronavirus, after at first seeming to not want to upset trade negotiations with Beijing.
“There is a lot of reporting out there saying president has given mixed messages on China,” said Rep. Michael Waltz of Florida, a co-sponsor. “He understands the reality we are in. The reality there is huge dependencies across the American economy on things sourced and produced in China.”
While Republicans expect Trump’s support, the bill faces challenges in the House, given Natural Resources Committee Chairman Raul Grijalva usually opposes efforts to ease permitting of mining projects on federal lands, as the bill would do. A similar version of the House Republican bill has been introduced in the Senate by Lisa Murkowski and Joe Manchin, the chairman and top Democrat of the Energy Committee, respectively.
EQUINOR LAPS PEERS ON RENEWABLES SPENDING: Only one multinational oil major, Norway-based Equinor, is putting serious money on the table with renewables investments, according to an analysis Friday by consulting group Rystad Energy.
The world’s oil majors have collectively promised to spend $17.5 billion on wind and solar projects over the next five years. But $10 billion of that will be spent by Equinor alone, the only company that will dedicate the majority of its capital spending to renewable energy, Rystad said.
Without including Equinor, renewable investments from major oil and gas companies are projected to decline over the next three years. That doesn’t even factor in announced capital spending cuts from oil majors as a result of the pandemic.
“Recent suggestions of ‘resilient green strategies’ or ‘business as usual’ simply do not carry much weight, with the exception of Equinor. Not until later in the decade do we see an increase in renewable spending from other companies,” said Gero Farruggio, Rystad’s product manager for renewables.
AT LONG LAST…TREASURY UNVEILS CARBON CAPTURE TAX CREDIT PLANS: Carbon capture developers and investors have been waiting for more than two years on the rules, which outline how the IRS will implement the incentive program.
Late Thursday, the IRS proposed rules offering answers to some of the tougher questions it left unanswered in initial guidance released in February. Those questions include how companies must demonstrate they are securely storing carbon underground, in what situations the government can reclaim the tax incentive if projects fall short of requirements, and how to account for emissions reductions from carbon stored in products.
The IRS proposal comes after Republican and Democratic lawmakers have been increasing pressure on the Trump administration to finish the rules. Two Republican senators, including Senate Environment Committee John Barrasso, raised the issue directly with Trump during a meeting last week.
The Carbon Capture Coalition, which represents more than 75 energy companies, environmental groups, and labor unions, welcomed the IRS proposal in a statement Friday as “comprehensive and thorough.” Especially significant, the Coalition said, is the IRS’ plans to allow an internationally developed standard as an alternative means for companies to show they are securely storing carbon dioxide underground, in addition to the EPA method the program currently requires.
“I really do believe that this is the confidence boost that we needed, and it’s reinforced by the fact that the IRS was very clear in the things they didn’t accept and why,” Brad Crabtree, director of the coalition, said of the IRS proposal. Its release is one of the critical steps in “the various pieces of the puzzle to get us on track for economy wide deployment of carbon capture,” Crabtree told Abby.
More in Abby’s story posted last night.
NINTH CIRCUIT KEEPS FAST-TRACK PERMITS FOR PIPELINES ON ICE: The Thursday order from the court means energy companies won’t be able to use the Army Corps’ streamlined permitting process — known as nationwide permit 12 — for new oil and gas pipelines for months, while the appellate judges hear broader arguments over its legality.
The Trump administration, industry groups, and several states had urged the Ninth Circuit to reverse a federal district court decision pausing use of the permit, a massive blow to pipeline projects, including the Keystone XL. The Ninth Circuit judges said those appealing the pause didn’t demonstrate “a sufficient likelihood of success on the merits and probability of irreparable harm to warrant a stay pending appeal.”
TC Energy, which is building the Keystone XL pipeline, told Bloomberg Environment the Ninth Circuit’s ruling “creates unnecessary harm to vital energy infrastructure projects across the U.S., inevitably delaying or eliminating thousands of high-paying job opportunities for skilled American workers this year.”
Environmentalists, though, praised the decision and pledged to continue fighting the Keystone XL pipeline. “The Trump administration has repeatedly violated the law in their relentless pursuit of seeing Keystone XL built, and it would have been unconscionable to allow this pipeline to be built through rivers, streams, and wetlands while it remains tied up in court,” said Doug Hayes, a senior attorney with Sierra Club.
FERC SUED OVER LNG PROJECT APPROVAL: The Natural Resources Defense Council sued FERC in D.C. Circuit Court on Thursday over its approval of the $10 billion Jordan Cove LNG export facility in Oregon.
NRDC said FERC failed to demonstrate an economic need for the project given the developers have not identified outside buyers for the LNG.
FERC had rejected the project four years ago. Last week, it denied a “rehearing” request to revisit its decision in March approving the project, the first terminal for LNG on the West Coast permitted by the commission.
“Jordan Cove still hasn’t identified any outside buyers for this gas, and so that means landowners will lose their land and the environment faces great risks all for a project that will undoubtedly become a white elephant,” said Gillian Giannetti, a lawyer for NRDC’s Sustainable FERC Project.
DEMOCRATS SEEK THE RECEIPTS ON BIG OIL’S FUEL ECONOMY INVOLVEMENT: Top Democrats on the House Oversight committee are asking the head of Marathon Petroleum to turn over any correspondence employees of the oil refinery had with the EPA about the Trump administration’s weakening of fuel economy standards.
“[I]t appears that the oil industry—and Marathon in particular—are driving forces behind the Trump Administration’s decision to weaken tailpipe emissions standards for cars and light trucks,” reads the Thursday letter from Rep. Carolyn Maloney, the chairwoman of the oversight committee, and Reps. Harley Rouda and Rashida Tlaib, the top Democrats on the environment subpanel.
Sen. Sheldon Whitehouse, who questioned EPA Administrator Andrew Wheeler intensely about Marathon’s involvement in the fuel economy rule during a hearing last week, also signed onto the letter. Wheeler, during those exchanges, said he hadn’t met with anyone from Marathon about the fuel economy standards and rejected Whitehouse’s claims that the oil industry was the intended beneficiary of the weakening of the Obama-era limits.
The Rundown
Wall Street Journal Coronavirus outbreak threatens oil majors’ biggest projects
Washington Post Empire state of green
Axios In Europe’s green recovery, natural gas faces uncertain future
Reuters OPEC, Russia bargain over oil cuts ahead of June meeting
Bloomberg The world’s most influential energy model needs a climate update
Associated Press Trump’s fossil fuel agenda gets pushback from federal judges
Calendar
FRIDAY | MAY 29
The Senate and House are out.
