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OIL INDUSTRY RAMPS UP RESISTANCE TO TRUMP’S BIG ETHANOL PLANS: The oil industry is ramping up its fight against President Trump’s forthcoming regulations to boost ethanol in the gasoline supply, calling them a bad deal for both the industry and consumers, while holding out the prospect of a legal fight.

“This proposal is a lose-lose for our industry, but more importantly it’s a lose-lose for consumers,” Frank Macchiarola, head of downstream operations at the American Petroleum Institute, told John in a Wednesday morning interview.

Macchiarola warned that if these ethanol-boosting regulations go forward, API would sue the government.

Macchiarola’s group, the largest oil lobby in the country, is gearing up to fight Trump’s forthcoming regulations geared to do two major things: Relax rules in order to allow higher 15-percent ethanol fuel blends, or E15, to be sold year round; and enact market reforms to try and fix problems in the ethanol credit, or RIN, trading market.

Trump directed Environmental Protection Agency acting chief Andrew Wheeler in the fall to pursue the rules.

The ethanol industry and corn farmers, for the most part, have praised the action, while the oil industry has opposed them.

In anticipation of the rules being rolled out soon, API issued a new report on Tuesday outlining the case that the RIN market changes are bad for business. They see the fuel harming vehicle engines and putting oil refiners on the hook for the damages.

The details of the study: The new API report says the actions EPA is directed to take to help increase RIN market transparency are unnecessary based on actions the agency has already taken in the last decade to do just that, Macchiarola said.

“No modifications should be made absent clear evidence that there is a problem to be fixed with respect to the RIN market rules,” concludes the report, done by consultants at Covington and Burling.

What is a RIN, anyway? RINs are Renewable Identification Number credits, which are used by refiners to show they are following the Environmental Protection Agency’s Renewable Fuel Standard mandate, which requires refiners to blend ethanol and other biofuels into the nation’s gasoline and diesel supplies.

The credits are generated when a gallon of renewable fuel is blended into gasoline, for example.

But the majority of refiners are not able to generate their own RINs, because of a lack of infrastructure, and are dependent on purchasing them from the major oil companies, like Exxon and BP, that possess the fuel blending infrastructure required to generate the credits. Because the RIN prices have risen wildly in recent years from pennies to over a dollar, the independent oil refiners have been paying more for the credits, which has been undermining their profits.

Congress has called on the EPA to address the issue in recent years, and the Commodity Futures Trading Commission has looked into whether the RIN market is manipulated, but the independent refiners have sought more radical fixes. They wanted the administration to change the fuel mandate such that they are no longer on the hook to blend ethanol. But that proposal was scrapped after a contentious battle.

Trump settled on directing the EPA to enact rules to show who possesses the greatest number of RINs, in an effort to make it more readily apparent who, or what, is causing RIN prices to rise and to control it.

Some refiners have said the high RIN prices have caused them to file for bankruptcy protections, because of the hundreds of millions of dollars in RIN costs they are saddled with each year.

But API thinks what EPA has been ordered to do by the president is premature, and could undermine the federal oversight that is already taking place.

Give EPA more time: Macchiarola thinks the administration should give EPA more time in implementing previous actions to track RIN credits, before enacting these reforms that “could “end up doing more harm than good,” he said.

The administration’s forthcoming rules would place limitations on the number of participants in the market, in addition to the number of positions participants are allowed to control in the market when it comes to the number of credits a company or bank can control.

API thinks this could have a “dampening effect” on the ethanol credit market, forcing companies to become more guarded, and less forthcoming about the credits they buy and trade.

A win for Iowa and ethanol producers: Meanwhile, the ethanol industry sees the regulation as a true win for their industry, which will open up the summer driver season — the largest fuel consuming months of the year —- to 15 percent ethanol fuel being sold. That in turn will require more corn to be processed, a win for the farmers, and more ethanol to be produced, a win for renewable fuels and Iowa voters. Iowa is the largest ethanol producer in the country, and Trump has promised its farmers he would not harm the EPA fuel mandate.

This could happen as soon as this week: Many fuel lobbyists anticipate the regulations being issued as soon as this week in order to make sure the rules become the law of the land by June 1.

“My understanding is there’s a push to get it done before driving season, or finalized before driving season, which would be around the Memorial Day time frame,” Macchiarola said. “Our anticipation is that we are going to have a proposal in the near term, very soon.”

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SENATE TO TAKE PROCEDURAL VOTE ON WHEELER’S CONFIRMATION TO EPA: The Senate is taking a procedural vote Wednesday afternoon on Wheeler’s nomination to continue leading EPA without the acting title.

Wheeler is expected to have enough Republican votes to clear the procedural hurdle, despite near-universal Democratic opposition, paving the way for his confirmation. Republican hold a 53-47 majority in the Senate.

The cloture vote is scheduled for 12:15 p.m.

MCCONNELL VOWS VOTE ON GREEN NEW DEAL BY AUGUST: Senate Majority Leader Mitch McConnell said the Senate will vote before August on the Green New Deal resolution authored by progressive Democrats.

“I’ve been reading with some amusement that our friends on the other side appear reluctant to vote on the Green New Deal,” McConnell said Tuesday, referring to the resolution freshman Rep. Alexandria Ocasio-Cortez, D-N.Y., and Sen. Ed Markey, D-Mass., introduced this month. “The only question I would ask is if this is such a popular thing to do and so necessary, why would one want to dodge the vote?”

Several 2020 Democratic presidential candidates in the Senate have endorsed the resolution, but none have said how they will vote when it hits the floor.

However, Senate Democrats are coalescing around a plan to counter what they view as a show vote stunt by Republicans, by introducing a separate resolution acknowledging climate change as a threat that Congress needs to address.

The move, reported by Politico, would challenge members facing re-election in purple states in 2020, like Sens. Cory Gardner, R-Colo. and Susan Collins, R-Maine.

Democrats argue the GOP has done nothing legislatively to combat climate change.

BIPARTISAN SENATORS PUSH FOR PASSAGE OF CARBON CAPTURE BILL: A bipartisan group of senators boasted Wednesday morning about promoting a bill to advanced carbon capture research and development, which they view as a concrete step to reduce emissions and more realistic than some of the concepts proposed in the Green New Deal.

The Senate Environment and Public Works Committee hosted a hearing on the USE IT Act, which would invest $50 million into a government program to research carbon capture and utilization technologies that would trap carbon from industrial facilities and reuse it for commercial products.

It would also facilitate the construction of pipelines to transport the captured emissions to where it can be sold, and set up a program to incentivize the creation of technologies that can suck carbon directly out of the air and store it underground. “Direct air capture” is expensive and in its infancy, but is valuable because it would create “negative emissions,” meaning it could remove more carbon than is burned.

The bill passed the Environment and Public Works Committee last May, but it did not move to the Senate floor. A bipartisan group of House lawmakers has introduced an identical bill.

Backers hope to get it to Trump’s desk this year, because advancements in carbon capture are considered by the United Nations climate change panel to be crucial to cutting emissions as long as fossil fuels play a major role in the economy through midcentury.

“Americans should reduce emissions through innovation, not punishing regulations,” said Sen. John Barrasso, R-Wyo., the chairman of the committee who co-sponsored the bill.

“Normally you hear about us fighting and how we don’t work together,” said Tom Carper of Delaware, the top Democrat of the committee. “This may be one of those kumbaya moments.”

However, he said research and development into carbon capture would have limited impact unless Congress imposes a price on carbon, which most Republicans oppose.

HOUSE GOP VOTE TO END CLIMATE CHANGE HEARING AFTER ONLY TWO DEMOCRATS SHOW UP: House Republicans on Tuesday claimed a small victory over the Democrats’ climate change agenda by holding a rare successful vote as the minority to end an oversight hearing, saying that the subject of global warming was outside the committee’s jurisdiction.

The Republicans on the Natural Resources Committee’s oversight panel won in a 4-2 vote to end the hearing, simply because there weren’t more than two Democrats present.

The issue of jurisdiction: Rep. Louie Gohmert of Texas, the top Republican on the Oversight and Investigations subcommittee, called for the vote after laying out the case that climate change was not within the jurisdiction of the committee, based on its charter and House bylaws.

The full committee’s top Republican, Rep. Rob Bishop of Utah, had raised the jurisdiction issues at the beginning of the month when the Democratic leadership launched its sweeping series of hearings on climate change. Bishop also said the Democrats were not properly giving notice to Republican members on the topics of the hearing.

Forced into a ‘forum’: With the Republicans in adjournment, the Democrats were forced to change the proceedings from a hearing to a “forum,” which Rep. T.J. Cox of California, the chairman of the oversight panel, opened by introducing the speakers.

SAUDIS IGNORE TRUMP’S THREAT TO ‘RELAX’ ON OIL PRICE HIKE: Saudi Energy Minister Khalid al-Falih said Wednesday that OPEC would continue with its production cut agreement to raise oil prices, despite new threats from Trump.

The Saudi energy minister said OPEC producers “are taking it easy,” with “a long and measured approach” to curbing oil prices, in comments reported by CNBC and the Wall Street Journal.

That phrasing is a direct response to Trump’s statement posted to Twitter on Monday, in which the president warned the oil cartel to “take it easy” on its production cut agreement.

Trump is frustrated by an agreement between Saudi Arabia-led OPEC with Russia, implemented last month, to cut 1.2 million barrels per day of oil production in an effort boost falling prices.

The oil price has since increased about 25 percent this year, a rise that can also be attributed to Trump administration sanctions on OPEC members Iran and Venezuela.

Falih, however, suggested Wednesday that OPEC would look to extend the agreement past its six-month duration, when it is scheduled to be reviewed.

“I am leaning toward the likelihood of an extension [of the output cuts] in the second half,” he told reporters.

HOUSE SENDS TRUMP MAJOR PUBLIC LANDS BILL THAT SAVES LWCF: The House approved a bipartisan public lands package Tuesday evening that permanently reauthorizes the popular Land and Water Conservation Fund, which Congress let expire in September.

Supporters say the bill, which passed 363-62, is the largest public lands bill considered by Congress in a decade, packaging 100 separate bills into one. The Senate passed it earlier this month on a 92-8 vote. The legislation now moves to the desk of Trump, who is expected to sign it into law.

The measure won the support of a broad swath of interest groups, including the oil and gas industry, conservationists, and public lands advocates.

TRUMP NOMINATES DANIEL JORJANI TO BE INTERIOR’S TOP LAWYER: Trump on Tuesday nominated Daniel Jorjani to be solicitor general of the Interior Department — the agency’s top lawyer.

The position has been vacant for more than two years.

Jorjani has served as deputy solicitor general since May 2017.

He previously served in the Interior Department under President George W. Bush, including as counselor to the deputy secretary. He was also director of policy at the Charles Koch Institute.

RUNDOWN

Politico Senate Democrats to offer unanimous climate resolution that’s not the Green New Deal

E&E News Video shows EPA security guard shove reporter out of building

Reuters Volvo’s Polestar joins electric car race with rival to Tesla 3

New York Times Britain experiences summer temperatures on hottest winter day