Daily on Energy: Peters tries to regroup for permitting reform – ‘we will still fail’ without it

Peters, a California Democrat who has worked across the aisle to try to update the NEPA review process and accelerate the speed of building out new transmission lines, praised the Inflation Reduction Act and bipartisan infrastructure law as historic efforts to address climate change and incentivize new clean energy and renewable investments.

Now, he said, Congress must turn to the second part of the equation: permitting and transmission.

“We can have all the money in the world, but we will still fail” if lawmakers don’t work to accelerate the permitting process and add new transmission, Peters said. “The stakes are incredibly high.”

Why it matters: To meet current climate goals, the U.S. must build 200,000 miles of new high-voltage transmission lines, Peters said. Currently, the U.S. is adding only 1,800 miles a year.

A recent report from Princeton University concluded that 80% of projected emissions reductions from the IRA will not be realized unless the pace of transmission line build-out is tripled.

A breakthrough on permitting reform would make it easier for the U.S. to both build infrastructure for natural gas pipelines and LNG exports—and for transmission lines to be built to help get clean energy onto the grid, former FERC chairman Neil Chatterjee told Breanne.

“But the challenge is, it’s really, really difficult to build things in America—so we also need a breakthrough on permitting reform,” Chatterjee said. And Congress “has, thus far, struggled to find the appropriate compromise in which you could build both.”

Reminder: Sen. Joe Manchin had asked for a vote on permitting reform legislation as a condition of providing the pivotal vote for the IRA – but never got it.

View from the Hill: Peters has introduced several bills aimed at streamlining the permitting process and bringing new resources online quicker.

Most recently, he and Sen. John Hickenlooper introduced the BIG WIRES Act, which is meant to facilitate the transfer of power between regional power grids in the U.S. The bill would require FERC to set minimum transfer capacities of 30% for all regions; allowing for the transfer of power from one part of the country to another in the event of a supply emergency and helping avoid grid collapse or capacity shortfalls.

NEPA is also due for an update, Peters said today, noting that when the law was passed in the 1970s, the nation “was on defense” and needed to set environmental safeguards and stop dirty profits.” Now, “the country needs to go on offense,” he said, “and be focused on the building part of the equation.”

That can’t happen as the law currently stands. The NEPA approval process on average takes more than four years to complete—a deep mismatch for the current U.S. energy landscape, which has been mired by capacity shortages and threats of near-collapse amid extreme weather events and record demand.

NEPA “didn’t come from Moses on stone tablets,” Peters said, adding that the law can and should be updated to better meet the needs of the U.S.

Welcome to Daily on Energy, written by Washington Examiner Energy and Environment Writers Breanne Deppisch (@breanne_dep) and Nancy Vu (@NancyVu99). 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.

EXXON MOBIL DEAL WITH PIONEER CLOSES: Oil and gas giant Exxon Mobil has acquired the major shale producer Pioneer Natural Resources in a merger valued at nearly $60 billion, the largest oil and gas deal in 20 years and one that will tie the company’s future to fossil fuels, Nancy writes. 

The deal, valued at $59.5 billion, or $253 a share, is expected to come to a total enterprise value of $64.5 billion. The merger will secure Exxon’s status as the largest player in the fracking industry, covering more ground in West Texas, which is where Pioneer is stationed.

The merger will have a combined Permian production volume of more than 1.3 million barrels of oil equivalent per day, or MOEBD, an amount expected to increase to approximately 2 million MOEBD in 2027.

“The combined capabilities of our two companies will provide long-term value creation well in excess of what either company is capable of doing on a standalone basis,” Exxon Mobil CEO Darren Woods said in a written statement. “Their tier-one acreage is highly contiguous, allowing for greater opportunities to deploy our technologies, delivering operating and capital efficiency as well as significantly increasing production.” Read more here.

CARBON EMISSIONS WILL INCREASE BY 2050, PER EIA REPORT: The Energy Information Administration predicted in a new report that carbon emissions will increase through 2050 amid growth in global energy consumption, falling short of the net-zero emissions goals set by the Paris Climate Accords.

As Nancy lays out, the projections, released on Wednesday in the agency’s annual International Energy Outlook report, pointed to worldwide population growth, increased regional manufacturing, and higher living standards as factors that would swell energy consumption “beyond advances in energy efficiency.” While the report acknowledges that renewables and nuclear technology will meet the bulk of energy demand through 2050, the technology is insufficient to decrease energy-related carbon emissions in most cases.

However, the modeling for the EIA’s predictions are under the assumption that no new laws or regulations take place, and the agency acknowledged that the report should not be held as a strict forecast, as new policies and geopolitical events could alter the trajectory of the global energy system.

These predictions run afoul of the climate agreement set forth by more than 190 state governments in 2015, in which parties agreed to keep the rise in global temperatures below 2 degrees Celsius above preindustrial levels and reach net-zero levels by 2050. Read more from Nancy here. 

WORLD’S LARGEST WIND FARM TAKING OFF – A project considered the world’s largest offshore wind farm produced its first power over the weekend, CNBC reports.

Placed off the coast of Northeast England in the North Sea, the Dogger Bank Wind Farm is being developed in three phases, and will have a capacity of 3.6 GW once it is fully up and running.

The scale of the project is considerable, with those in charge of the wind farm predicting it will be able to power as many as 6 million homes per year.

U.K. Prime Minister Rishi Sunak welcomed the news, describing offshore wind as being “critical to generating renewable, efficient energy that can power British homes from British seas.” Sunak has faced criticism from environmentalists recently for delaying a ban on sales of gas-powered cars. Read more about the project here. 

GOP PUTS THE BLAME ON BIDEN ENERGY POLICIES FOR ISRAEL CONFLICT: Following the attack on Israel from Iran-backed Hamas militants, Republicans placed blame on the Biden administration’s energy and climate policies – focusing on the $6 billion in Iranian oil reserves the Biden administration released for humanitarian purposes and accusing President Joe Biden of not doing enough to enforce Iran oil export sanctions.

As E&E News reports, former House Speaker Kevin McCarthy on Monday criticized the administration’s failure to impose tougher sanctions against the Nord Stream 2 gas pipeline linking Russia and Germany in early 2021 amid pressure not to do so from Berlin—a decision McCarthy panned as “a Neville Chamberlain moment.”

“That is when evil feels they can move. That’s exactly what they did,” McCarthy said of the Palestinian militants. He further accused Biden of leaving the U.S. and its allies vulnerable.

The violence in Israel is only elevating calls from both parties to urge the White House to do more against Iran’s oil sales to China, with Republicans arguing that the administration’s decision to release billions of dollars in Iranian oil earnings helped spur the attacks. Several administration officials have denied the claim, arguing that the money has not been used yet.

“These attacks reinforce the need for a more aggressive U.S.-Iran policy that more effectively deprives the regime and its proxies of resources,” Idaho Sen. Jim Risch, the top Republican on the Senate Foreign Relations Committee, told E&E News. “Sanctions and sanctions enforcement — particularly Chinese purchases of Iranian oil — need vast improvement.” Read more on that here. 

Related: Gaza’s sole power plant ran out of fuel and shut down today because of the Israeli blockade, the Gaza Ministry of Energy said.

JAPAN LAUNCHES CARBON CREDIT EXCHANGE: Carbon trading in Japan began on Wednesday, as the nation looks to price emissions to help reach net zero levels by 2050, Bloomberg reports.

Run by the Tokyo Stock Exchange, participants can trade “J-Credits” – locally issued units certified by the government that are awarded to projects that reduce emissions and can be used by companies or institutions wishing to offset their own pollution. The credits are divvied up into six categories, such as renewable energy and agriculture.

Critics have argued that the calculations of offset emissions used in the credits may not be accurate, and that credits might be granted for projects that do not yield additional carbon offsets – such as not chopping down forests.

Other Asian countries are also attempting to price pollution – Indonesia, for example, began a carbon emissions trading market last month. Japan aims to cut greenhouse gas emissions by 46% from 2013 levels by 2030 and plans to launch “full-scale” emissions trading by 2026, although details haven’t yet been released. Read more on that here. 

The Rundown

E&E News Quiz show: GOP deploys new climate messaging tactic

The Post and Courier SC wants to make it easy to build electric vehicles here. Buying one is another story.

Bloomberg Fear and Anger Follow the Path of Joe Manchin’s Mountain Valley Pipeline