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A PREVIEW OF CONFLICT TO COME: Corn-state lawmakers are welcoming the Biden administration’s announcement that it will waive regulations limiting the use of E15 gasoline, but refinery interests that have successfully challenged E15 waivers before criticized the decision as “unlawful,” in what may be a preview of new legal battle over the fuel.
Currently, the Environmental Protection Agency regulates the vapor pressure of retail gasoline sold during the summer months as a means of limiting pollution, restricting when and where fuels with higher concentrations of ethanol can be sold beginning June 1 through Sept. 15.
EPA “plans to waive that restriction under the law while the supply emergency caused by Putin’s war continues,” a senior administration official told reporters yesterday in a call previewing the announcement.
White House officials said the EPA’s waiver is expected to be finalized “closer to June 1,” Breanne reports.
Members of Congress in both parties have been pushing for this change for some time, as we covered last week, as a means of reducing fuel prices and supporting domestic fuel producers over foreign ones.
What happened the last time around: The Trump administration in 2019 instituted its own regulatory changes to exempt E15 from the regulations in question, but that move was quickly challenged by refinery and small retailer interests, and the D.C. Circuit Court of Appeals vacated the rule.
The American Fuel and Petrochemical Manufacturers, which was lead plaintiff in the suit against Trump era E15 change, had argued the Trump EPA misinterpreted the Clean Air Act and lacked legal authority to make the changes.
Chet Thompson, president and CEO of AFPM, described the pending Biden EPA E15 decision as “an unlawful executive order” that is “not how to solve the problem” of high fuel prices.
“Emergency fuel waivers are short term and reserved for very specific unforeseen events and regionally acute supply disruptions, such as those resulting from a hurricane,” Thompson said in a statement. “An additional three months of E15 sales won’t do anything to address high crude oil prices.”
The differences: Notably, the White House said it’s pursuing an emergency waiver, not proposing a rulemaking to change the E15 regulation.
The administration official said yesterday the EPA action “will be rooted in the current fuel supply emergency” and said “EPA is planning to make this waiver so long as the current fuel supply emergency continues.”
An EPA FAQ page on fuel waivers stresses that they “cannot be issued to address concerns regarding the price of fuel.” Note that White House officials characterized the decision as “yet another action that the President is taking to combat Putin’s price hike.”
The FAQ says also the Clean Air Act allows for waivers “only to address a temporary emergency fuel supply shortage that exists throughout a state or region that was caused by an unusual situation such as an Act of God, and that could not have been avoided by prudent planning.”
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E15 WAIVER WELCOMED: Biofuel trade group Growth Energy called the Biden administration’s decision “welcome news” that will save drivers money.
“Lifting outdated and unnecessary summertime restrictions on E15 will ensure continued access to a fuel that has been saving drivers as much as 50 to 60 cents a gallon in recent weeks,” said Growth Energy CEO Emily Skor.
Republican Sen. Deb Fischer of Nebraska, who has been among those calling on President Joe Biden to make this move, said E15 should be made readily available “throughout the energy crisis and beyond.”
The unhappy: Food & Water Watch called the decision “pointless for consumers and bad for the planet” (Some researchers have concluded that biofuel production under certain circumstances is responsible for more greenhouse gas emissions than equivalent gasoline.)
ENERGY PRICES UP NEARLY A THIRD IN PAST YEAR: Energy prices have soared 32% over the past year, the Bureau of Labor Statistics reported this morning in its release of the Consumer Price Index, including 11% just in the month of March.
Gas prices are up nearly 50%, and fuel oil prices are up 70%.
Energy prices helped push overall inflation up to 8.5%, the highest rate since December 1981 and a major problem for Biden and Democrats.
Meanwhile, state lawmakers are also seeking new ways to alleviate pain at the pump: Democrats in Virginia are planning to introduce a proposal that would provide payments of $50 per driver, or $100 per household, as an alternative to Republican Gov. Glenn Youngkin’s proposed three-month gas tax holiday. The state gas tax currently stands at 26 cents per gallon, the Richmond Times-Dispatch reports.
Youngkin’s proposed three-month gas tax holiday comes after the Virginia Senate rejected his earlier proposal, which would have rolled back the most recent increase in the state gas tax for 12 months.
PG&E SETTLES WILDFIRE CASES: California utility Pacific Gas & Electric Company reached a $55 million settlement agreement with district attorneys from six counties after it was charged over its equipments’ roles in last year’s Dixie Fire and the 2019 Kincade Fire, the Washington Examiner‘s Tori Richards reports.
Cal Fire determined the Dixie Fire, the largest on record, was ignited after a tree contacted distribution lines. A PG&E cable was also found to have been responsible for the Kincade Fire.
The utility will expedite claim payments for victims of the fires and hire more workers to monitor vegetation as part of the settlement.
TECH FIRMS COMMIT TO BUYING CARBON OFFSETS: A number of prominent tech firms have put $925 million into Frontier, an initiative that facilitates an advance market commitment to pay for permanent carbon removal.
“We want to send a loud demand signal to entrepreneurs, researchers and investors that there is a market for permanent carbon removal: build and we will buy,” said Stripe head of climate Nan Ransohoff.
In addition to Stripe, Alphabet, Meta, and Shopify are backing the venture.
The idea is to create and guarantee demand for carbon removal, allowing companies working on carbon removal tech to invest, confident the market will be there for them.
Frontier says it is looking for “permanent carbon removal solutions that have the potential to be low-cost and high-volume in the future.”
BIDEN ASKS MODI NOT TO ACCELERATE PURCHASES OF RUSSIAN OIL: President Biden asked Indian Prime Minister Narendra Modi yesterday not to accelerate his country’s purchases of Russian oil.
Modi’s government did not publicly commit to refraining from future purchases, however, in what has emerged as a source of growing tension between the two countries amid Russia’s war in Ukraine.
During their video call yesterday, Biden told Modi that the U.S. could help India diversify its sources of energy, White House press secretary Jen Psaki told reporters. Though India receives only a small portion of its oil imports from Russia — roughly “1-2%,” Psaki said — the U.S. “made clear, and the president made clear, that we would be happy to help them in diversifying this as well.”
But Modi’s government would be hard-pressed to reduce its purchase of Russian oil, which it has been receiving at a discount of 20% below global market prices in the weeks since Russia began its invasion of Ukraine. Since the war began, India has purchased roughly 13 million barrels of discounted Russian crude, in contrast to the 16 million barrels it purchased during all of 2021.
BIDEN TEAM ON TOUR: Biden administration officials plan to travel around rural America this month to advertise programs funded by the new infrastructure law, the Washington Examiner’s Haisten Willis reports.
A White House announcement said cabinet officials, including Energy Secretary Jennifer Granholm, EPA Administrator Michael Regan, and Interior Secretary Deb Haaland, will participate in the “rural infrastructure tour” to talk about the various spending projects and to help show rural areas how to access funds for things like high-speed internet and wastewater system improvements.
PODCAST COVERS LATEST ENERGY NEWS, FROM THE HILL TO UKRAINE: Breanne joined former FERC chairman Neil Chatterjee on this week’s “Plugged In” podcast to make sense of a busy week in energy news, including reports that the Biden administration is weighing whether to increase Canadian oil imports to help offset the loss of Russian energy supplies, as well as the EU’s recent decision to ban imports of Russian coal. Listen here.
The Rundown
E&ENews Texas Railroad Commission: A barrier to Biden’s energy plan?
Washington Examiner Pennsylvania man arrested after putting ‘I did that!’ Biden stickers on gas pumps
AP Russian war worsens fertilizer crunch, risking food supplies
Politico Red states ask court to torpedo special California authority over vehicle emissions
Calendar
TUESDAY | APRIL 12
1:00 p.m. The R Street Institute will host a virtual event with former FERC commissioners Neil Chatterjee, Pat Wood, and Nora Brownell titled, “Competitive Electricity Policy: Past, Present and Future.”
THURSDAY | APRIL 21
11:00 a.m. Woodridge, Ill. The House House Science, Space, and Technology Subcommittee on Investigations and Oversight will hold a field hearing in Illinois on electric vehicle batteries and U.S. critical minerals supply.
