Daily on Energy: Michigan Senate signs off on major clean energy legislation

The Democratic majority voted in favor of bills that would change Michigan’s clean energy and energy waste reduction standards, require the Michigan Public Service Commission to consider additional factors when regulating energy companies, and create an office that would help smooth the economic transition from fossil fuels to clean energy. The bills now move to the Democratic-controlled House, where Republicans have promised to wage a fight against the package.

“This clean energy package is a big deal,” Michigan Gov. Gritchen Whitmer said in a statement following the package’s passage in the Senate.

What’s in the package: 

• A bill that would require energy companies to gradually achieve a renewable energy credit portfolio through certain deadlines. Firms would be required to generate 50% of their energy through renewable sources by 2030, and 60% by 2035. The range of renewable energy sources range from solid waste, gas from methane digesters using municipal sewage waste, to food waste and animal manure, as well as waste-to-energy incinerators that were generating power before Jan. 1, 2023. The bill would also require energy companies to reach an 80% clean energy standard by 2035 – a less aggressive threshold compared to what Democrats have tried to pass at the federal level. The legislation will require a 100% clean energy standard by 2040, of which would include nuclear and natural gas using carbon capture technology – an approach that’s considered controversial among environmentalists. 
• A bill that would require the Michigan Public Service Commission to weigh factors such as equity and environmental justice, compliance with clean energy requirements, and other factors when considering energy companies’ plans for future operations. 
• A bill that would create a Community and Worker Economic Transition Office within the Department of Labor and Economic Opportunity, with the intention of aiding workers and communities whose jobs are affected by the clean energy transition. The bill would require the office to create a finalized transition plan to the governor and state legislature by December 31, 2025. 

The measures had passed along party lines, with Democrats voting down a series of amendments from Republican lawmakers.

Republican opposition: GOP lawmakers blasted the legislation as a radical plan that could stifle economic growth within the state.

“This is not the time to force the people of Michigan to pay more for less reliable energy,” Senate Minority Leader Aric Nesbitt said in a statement following votes. “Michiganders deserve responsible energy policy — an all-of-the-above approach that utilizes existing and reliable sources, including natural gas and nuclear energy, while continuing to build up a renewable grid for the future.”

House Republicans argued that Democrats in the lower chamber will need to work across the aisle in order to pass a clean energy standard, although Dems hold a small majority (56 Ds to 54 Rs).

“We won’t support anything that bans natural gas and whether they just outright ban it, or they try to disguise it by making it so expensive,” House Minority Leader Matt Hall told reporters, according to the Michigan Advance. 

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A PUSH FOR INFRASTRUCTURE SUPPORTING ELECTRIC HEAVY-DUTY CARS: Senate climate hawks are urging the Joint Office of Energy and Transportation to prioritize the deployment of infrastructure to help support zero-emission medium- and heavy -duty cars, in order to accelerate progress towards reaching net-zero emissions in the commercial vehicle transportation sector.

In a letter led by California Democrat Sen. Alex Padilla, the lawmakers emphasized that the office cannot afford to only focus on light-duty vehicles, as heavier-duty vehicles make-up a disproportionate percentage of emissions released from vehicles.

The senators laid out suggestions for the office to follow, which include putting forward a national plan to establish infrastructure supporting electric heavier-duty vehicles, coordinating federal investments to speed up implementation, creating guidelines for states and utilities to help support planning and build-out, and beefing up a trained workforce to help carry out the plans.

Who signed the letter: In addition to Padilla, Democratic Sens. Tom Carper, Cory Booker, Tammy Duckworth, Kirsten Gillibrand, Martin Heinrich, Tim Kaine, Edward Markey, Patty Murray, Bernie Sanders, Tina Smith, Elizabeth Warren, Peter Welch, Sheldon Whitehouse, and Ron Wyden also signed the letter. Read it here.

RADIO AD HITTING VIRGINIA CLEAN CARS LAW: Trade association American Fuel & Petrochemical Manufacturers is launching a new radio ad across the Northern Virginia and D.C. airwaves in attempts to build support against Virginia’s ban on gas-powered car sales by 2035 – igniting a hot-button issue weeks ahead of the November elections for the Virginia General Assembly.

The ad likens the Virginia law to California’s own ban, arguing that it would place a burden on consumers, and make the U.S. more dependent on China.

“Make sure you know where your elected officials in the Virginia Legislature stand,” the ad warns. “Tell them to stop the Virginia car ban before it’s too late.”

The significance: Republican Gov. Glenn Youngkin and other Virginia Republicans have already threatened to repeal the 2021 Clean Cars law, which would require 100% of new models on the market to be electric by 2035. Republicans in the House of Delegates passed legislation that aimed to rollback the law earlier this year, but the bill was stalled by the Democratic majority in the Senate. A loss of the Democratic majority could open the door to a repeal of the controversial law.

A PLAN TO EXPAND FLOOD AREAS: Millions of U.S. residents don’t have flood insurance and face financial disaster if their home is inundated – but a proposal by a federal advisory panel could shrink the nation’s insurance gap if adopted, E&E News reports.

The proposal would require millions of property owners to buy flood insurance for the first time, costing them thousands of dollars a year. The report from the FEMA’s Technical Mapping Advisory Council calls on the government to expand the areas considered by regulators to be at high risk of flooding. The consequences would be wide-ranging and costly, since property owners in those areas would be lawfully required to have flood insurance if their property is considered in a federally backed mortgage.

Expanding the flood insurance requirement to millions could upend housing markets across the nation by increasing ownership costs – but it could also financially protect millions of people who don’t have coverage as they face flooding risk. Uninsured homeowners can collect only a few thousands dollars in federal disaster aid after a major flood.

“This adjustment would be a significant shock,” Jeremy Porter told E&E News. Porter is the head of climate implications research at the First Street Foundation, a New York nonprofit that assesses climate risk. Read more on that here. 

ICYMI – COURT BLOCKS GULF OIL LEASING DEADLINE OF NOVEMBER 8: The Fifth Circuit Court of Appeals yesterday put an indefinite stay on a lower court order requiring the Biden administration to hold a lease sale in the Gulf of Mexico on Nov. 8, The Hill reports.

District Court Judge James Cain, a Trump appointee, had ordered the Interior Department to proceed with a lease sale (which was mandated under the Inflation Reduction Act) that includes 6 million acres that the administration had excluded on the grounds of protecting the Rice’s whale.

Yesterday’s Fifth Circuit stays that order until it can reach a decision on an appeal from conservation groups. Oral arguments are set for Nov. 13.

CHINA WARNS AGAINST ‘EMPTY SLOGANS’ AT COP 28: Xia Yingxian, head of the climate office at China’s Ministry of Ecology and Environment, called on western leaders to take a pragmatic approach to the problem of climate change at the COP28 talks in Dubai next month, mindful of concerns about energy security and economic growth.

“Empty slogans that are divorced from reality and ‘one size fits all’ might seem ambitious, but they harm the multilateral process of climate change,” he said, according to Reuters.

He also said that richer nations should follow through on their 2009 pledges to provide $100 billion in annual climate finance for poorer countries and set up a fund for “loss and damage,” which developing countries have proposed should amount to $100 billion by 2030.

China, the world’s largest carbon emitter, has been reluctant to commit to climate targets, and leader Xi Xinping warned earlier this year that “the pathway and means for reaching this goal, and the tempo and intensity, should be and must be determined by ourselves, and never under the sway of others.”

Of note, Chinese officials have decried “empty slogans” in the lead-up to previous interactions of COP.

RUBIO WARNS MEXICO OVER OIL SHIPMENTS TO CUBA: Sen. Marco Rubio of Florida issued a warning to Mexican president Andrés Manuel López Obrador over state oil company Pemex’s shipments to Cuba, saying that Mexico is at risk of running afoul of U.S. sanctions on the communist-run island.

Rubio, whose parents immigrated from Cuba and who is on the Senate Foreign Relations Committee, called on President Joe Biden in a Medium essay “to communicate that any attempt by Mexico to circumvent U.S. policy will be met with targeted sanctions on the sectors responsible.”

Rubio noted Reuters reporting that Mexico is outpacing Russia in shipping oil to Cuba. U.S. sanctions allow for shipments of fuel, food, and medicine to the Cuban people for humanitarian purposes, Rubio wrote, but AMLO indicated that the oil shipments go beyond those terms: “If they tell us, ‘Sell us oil, because we don’t have any way of getting it,’ of course we’re going to do so,” he said in a recent press conference.

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