Daily on Energy: The politics of the IRA one year in

Green Dems: White House Deputy Chief of Staff John Podesta made the case for why the IRA will be as durable as Obamacare – arguing that the ACA was “kind of unpopular” when it passed, but eventually became popular after it became implemented.

“Now, notwithstanding Republican efforts, they can’t tear it away, because people are really seeing its benefits,” Podesta said in an interview with Grist. “I think the same thing will be true of the Inflation Reduction Act.”

It’s obvious why Podesta, whose job is to pitch the IRA to companies and elected officials whose support will determine the law’s success, is going the length to tout the legislation. But his efforts, along with the rest of the party’s intentional endeavors to brag about the bill, highlights an underlying truth about this upcoming election: Democrats will need to go hard in making the mostly unknown legislation popular before they show up to the polls. But the central question remains: Can this key component of “Bidenomics” – the administration’s shorthand for the president’s economic efforts – have as strong of a legacy as “Obamacare”?

The Manchin camp: Sen. Joe Manchin still remains the odd man in the middle of the IRA. On one hand, he was one of the main powerbrokers in the Senate to bring the legislation to the finish line. But on the other, he’s the loudest critic of the bill within his own party.

The West Virginia senator issued a statement today praising the bill but also promising an “unrelenting fight” against the Biden administration implementing it as “a radical climate agenda.”

Still feeling the burn: Manchin has launched an outright war on the IRA’s implementation, threatening to sue the Biden administration over the Treasury Department’s rules for the electric vehicle tax credit, along with promising to “vote to repeal my own bill” if the Biden administration continues touting the bill as climate legislation rather than a bill on “energy security.”

His anger, however, can be understandable from a political lens: Manchin is staring down the barrel of getting ousted by formidable contender West Virginia Gov. Jim Justice, who has taken swipes at Manchin on his move to support the IRA. Manchin has yet to formally announce if he’s running for reelection – but if he does, he has his work cut out for him to convince West Virginians the clean energy bill is a good thing for his home state, where coal remains king.

Republicans: It’s a no brainer that Republicans would rally against the IRA – not one GOP lawmaker voted for the bill in Congress. And the anti-IRA campaign is heading into the presidential arena – Nikki Haley blasted the IRA as Biden’s “Communist Manifesto” on the bill’s anniversary, saying it makes the U.S. more dependent on China.

And she’s not the only one – many of the Republican candidates have taken their swings at the climate provisions in the bill and have threatened to repeal it. You’ll be hard pressed to find a Republican in Washington and on the campaign trail praising the bill.

The caveat: But a majority of the new clean energy projects from the bill have been announced in Republican districts, according to a Politico analysis. Some Republicans, like Oklahoma’s GOP Governor Kevin Stitt, have no issue with the IRA incentives that are bringing companies to his state – and are personally taking credit for attracting clean energy manufacturing.

“We’re just trying to be smart,” Stitt said in an interview with Politico. “All the [research and development] dollars are flowing into electric vehicles. Batteries. So then I’m thinking, let’s go where the puck is headed.”

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.

SAUDI OIL EXPORTS DROP TO 21-MONTH LOW: Saudi oil exports dropped to a 21-month low in June, according to new data published this morning, with the kingdom’s total exports for that month averaging roughly 6.8 million barrels per day (bpd).

That’s a 1.8% drop from its May esports, and marked the third straight month of declines, according to the data from the Joint Organizations Data Initiative. The news comes after Saudi Arabia said earlier this month that it would extend its voluntary 1 million bpd oil export cuts for an additional month to last through September, pushing prices higher as markets brace for an expected uptick in demand for the second half of the year.

VINFAST WORTH MORE THAN FORD AND GM: Shares for Vietnamese electric vehicle maker VinFast skyrocketed by 270% this week after its debut on the Nasdaq, putting the company’s valuation at $85 billion—higher than some of the largest automakers in the world, including Ford, GM, BMW, and Volkswgen.

Its U.S. trading debut comes after it completed its merger with Black Spade Acquisition, a U.S.-listed SPAC, or special purpose acquisition company that raises capital for the specific purpose of acquiring an existing operating company.

SPAC shares are considered by many analysts to be extremely volatile compared to a traditional IPO, but as VinFast CEO Lê Thị Thu Thủy told CNBC in an interview, VinFast had pursued a traditional IPO path for nearly two years before opting to decide to secure the funding via a SPAC. “You saw how the market reacted when we opened today, right? I think it’s just a way for us to get listed in the U.S. We didn’t think of the reputation of SPACs,” Lê said.

The EV maker is currently building a factory in North Carolina as it looks to build out its U.S. presence and compete with other automakers such as Tesla and BYD. VinFast estimates its North Carolina facility will be able to produce up to 150,000 vehicles per year in its first phase of operation. Read more from CNBC here.

TESLA LAUNCHES CHEAPER STANDARD-RANGE MODEL S AND MODEL X VEHICLES: Tesla launched standard-range versions of its Model S and Model X EVs this week, which are priced $10,000 less than the original versions, but which also get less range per charge.

The standard-range Model S is priced at $78,490 and has a range of roughly 320 miles per charge, Teslas said on its website, while the standard-range Model X SUV is priced at $88,490 and can travel about 269 miles per charge.

The new models come after Tesla has already lowered prices for its U.S. customers on several occasions his year, as it seeks to compete with a more saturated market and legacy automakers who have been shifting their focus to electric vehicles. Tesla also struggled with a tough earnings year in FY2022, though it reported a strong uptick in deliveries earlier this year after making price adjustments. Read more from the Wall Street Journal here.

CALIFORNIA TO KEEP GAS PLANTS ONLINE IN CASE OF WEATHER EMERGENCIES: California’s State Water Resources Control Board has approved plans to keep online three natural gas-fired plants along its southern coast through at least 2026, as part of the state’s effort to to bolster its power grid and ensure it has enough capacity during extreme weather events or other times of extreme demand.

The plan was negotiated last year by Gov. Gavin Newsom and California state legislators, and will only be used when weather forecasts and state grid operators predict major surges in power demand.

Still, opponents have criticized it as harmful to the environment, and directly at odds with the state’s goal of reaching 100% renewable or emissions-free electricity by 2045.

“These resources would only be turned on to address extreme events or for maintenance runs” at the direction of the state’s grid operator, deputy DWR director Delphine Hou said last week at a California Energy Commission meeting.

Newsom’s office previously estimated that the gas plants combined will be able to power 2.5 million homes in case of extreme demand, such as heat waves, and will help the state avoid capacity shortages and rolling blackouts like the state saw in 2020.

It’s part of a broader push in California to improve reliability. Newsom and state legislators have also approved plans to extend the life of the Diablo Canyon Nuclear Power Plant, and to create a new “strategic reliability reserve” program, which includes keeping the gas plants online, to avoid grid shortages for millions of people.

ENERGY TRANSFER TO ACQUIRE CRESTWOOD IN $7.1 BILLION DEAL: Texas-based pipeline company Energy Transfer said today it will purchase Crestwood Equity Partners for $7.1 billion, in a deal that will give Energy Transfer access to the Powder River basin and expand its presence in the Williston Basin in North Dakota and Delaware basin in Wyoming and Montana.

The news comes as Energy Transfer, one of the largest pipeline companies in the U.S., looks to expand its presence beyond West Texas and obtain a larger presence in North Dakota’s Bakken region, home to one of the largest shale basins in the country, according to the Wall Street Journal.

“These assets are expected to complement Energy Transfer’s downstream fractionation capacity at Mont Belvieu, as well as its hydrocarbon export capabilities from both its Nederland Terminal in Texas and the Marcus Hook Terminal in Philadelphia, Pennsylvania,” Energy Transfer said in a statement.

FRACKING LINKED TO CANCER, ASTHMA, AND PRENATAL PROBLEMS, STUDY FINDS: A new study from the University of Pittsburgh has found a correlation between hydraulic fracking and adverse health outcomes, including childhood lymphoma, asthma, and birth complications.

The study was commissioned by Gov. Tom Wolf, a Democrat, and utilized health data from across southwestern Pennsylvania, home to most of the state’s nearly 219,000 active fracking wells. Researchers observed that children who lived within one mile of one or more wells had a five to seven times chance of developing lymphoma, while asthmatic individuals living near fracking wells have a four to five times greater chance of having a severe asthma attack.

Though the researchers noted their study does not prove a causal link between fracking and adverse health conditions, they said it was designed to highlight the correlation between the controversial form of energy production and several separate categories of health problems, the Washington Examiner’s Gabrielle Etzel reports. Read more on the study here.

UNION OF CONCERNED SCIENTISTS BLASTS ‘RECKLESS’ NRC SMR RULE: The head of nuclear power safety at the Union of Concerned Scientists took aim at the U.S. Nuclear Regulatory Commission’s approval of SMR technologies without requiring such facilities to have offsite emergency plans in place, saying in a statement this week that the “reckless” decision will increase dangers for the public from the next generation of nuclear plants.

“[The] absence of offsite emergency planning will create burdens in the aftermath of a nuclear plant accident, extreme weather event, or terrorist attack that will fall disproportionately on those people and communities with the fewest resources,” said Dr. Edwin Lyman, the director of nuclear power safety at USCS.

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