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OIL INDUSTRY RE-UPS ITS BID TO REPEAL THE NATION’S ‘BROKEN’ ETHANOL MANDATE: The American Petroleum Institute on Thursday re-upped its near-decade-long bid to repeal the nation’s ethanol mandate.

A broken system: The Renewable Fuel Standard “mandate is broken and needs to be repealed or significantly reformed,” said Frank Macchiarola, API’s downstream director, outlining the group’s comments it will be filing with the Environmental Protection Agency on the 2019 biofuel blending standards ahead of Friday’s deadline.

Not going quietly into the sunset: Macchiarola said he is open to reforming the EPA biofuel program, but what he means by “reform” is legislation to sunset the program in 2022.

API is open to a deal with the ethanol industry, he said on a Thursday call with reporters. The group is willing to support selling higher 15-percent blends of ethanol in gasoline year round, which the ethanol producers want, but only if the ethanol industry goes along with sunsetting the program.

What’s cooking on Capitol Hill: There is both legislation in the House and Senate being drafted to reform the program, but it is unlikely that such a bill would be debated and passed in a year dominated by the midterm elections.

Other criticisms the oil industry will lay out in its comments include: The Renewable Fuel Standard has failed to lower greenhouse gas emissions blamed for causing climate change. The program was meant to lead to billions upon billions of gallons of advanced “cellulosic” fuels by now, but such robust production “has not come to fruition,” Macchiarola said.

The fuels are supposed to transition the mandate toward lower-emission fuels derived from waste, and not crops like corn. This would, in turn, lead to less production of carbon dioxide emissions and move the program closer to its goal of blending 36 billion gallons of biofuel into the nation’s fuel supply by 2022.

More ethanol equals more harm to vehicles: API will also argue that increasing the amount of ethanol in the gasoline supply to meet the 2022 goal would harm vehicle engines and lead to “costly repairs,” said Macchiarola.

The oil group wants EPA to cut the amount of fuel it requires refineries to blend next year to ensure against these problems.

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INTERNAL DISCORD OVER TRUMP FUEL STANDARDS COULD HARM LEGAL DEFENSE: The Trump administration will likely have a tougher time in court defending its plan to relax fuel efficiency standards for cars because of new evidence showing that federal agencies were internally divided over whether weaker rules would save lives.

“It strengthens legal challengers’ arguments that this was a political, and not a technical, decision,” Michael Gerard, an environmental law professor at Columbia University, told Josh.

Disagreement over safety: Career experts at the the Environmental Protection Agency disagreed with the National Highway Traffic Safety Administration, or NHTSA, on the number of deaths that would be avoided by rolling back stringent fuel-efficiency and emission targets set by the Obama administration, according to documents released Tuesday.

The two agencies ultimately both put their names to a joint proposal released Aug. 2 that says a freeze in the fuel standards could prevent 1,000 fatalities from crashes annually.

The Trump administration argued the Obama program, set in 2012, forcing automakers to double the fuel economy of their vehicles, would make cars and trucks more expensive and encourage people to keep driving older, less safe models.

But scientists from EPA’s Office of Transportation and Air Quality had privately warned in June that computer modeling used by NHTSA was flawed and argued that the rollback would actually increase annual traffic fatalities, by an average of about 17 deaths per year.

Rejected rationale: EPA’s internal analysis found that freezing the Obama rules would increase fatalities, cost thousands of jobs, and reduce social benefits by $83 billion.

“The safety argument was never a strong one and EPA pointed that out,” David Hayes, the executive director of the State Energy and Environment Impact Center, a coalition representing liberal attorneys general suing the Trump administration over the proposal, told Josh.

The major legal problem: Legal experts say EPA’s questioning of NHTSA’s methodology will bolster the argument of legal opponents who say the Trump administration has failed to justify its plan to weaken fuel standards with science-based facts.

“If there are just disagreements between the agencies, it would not be so troublesome,” Joseph Goffman, executive director of Harvard Law School’s environmental law program, told Josh. “But the fact the disagreement seems to hinge around the very methodology NHTSA used, which the EPA sort of did a reanalysis of, is really what creates a big vulnerability. The documents show the very tools NHTSA relied on are unreliable.”

EPA FIRED ME WITH SCIENCE: A company is arguing that it was forced to close its doors because of EPA science, as it looks to support  EPA’s so-called “secret science” rule.

Comments both for and against the rule are pouring in on Thursday, and the arguments of Delta Construction owner Norman Brown are among them. The Sacramento-based construction company argues that the company was forced to close because of the EPA’s use of a scientific study to form the basis for strict new pollution rules to forced him out of business.

You’re fired! “My equipment was sold at auction and employees ranging to 40 years with me lost their jobs,” Brown said. He sees merit in the science rule giving industry a voice when a single study can mean life or death for a business. In his case, it was a 1995 study on the harmful effects of soot from diesel engines.

What the rule does: The “Strengthening Transparency in Regulatory Science” rulemaking, as it is formally titled, would require EPA’s scientific studies to be independently verified through a peer-reviewed process outside the agency. It wouldn’t address any one issue or regulation, but rather would undergird the science behind much of what the agency does.

The rule would help the industry contain the cost of new regulation by giving them the ability to question the basis of new pollution standards, especially if the “public is likely to bear the cost of compliance” with those regulations, according to the EPA.

The deadline for submitting comments ends at midnight. Nearly a quarter of a million have already been submitted.

FEDERAL JUDGE ORDERS LONGER ENVIRONMENTAL REVIEW FOR KEYSTONE XL: A federal judge ordered the State Department Wednesday night to do a more extensive environmental review for a revised path of the long-contested Keystone XL pipeline, which could further delay a project that’s been in development for a decade.

What it means: U.S. District Court Judge Brian Morris of Montana said the Trump administration must do a full environmental impact statement. That review is more thorough than a draft environmental assessment that the State Department released last month that found the new Keystone XL route would cause no significant harm to water supplies or wildlife.

But that’s not what critics say: Environmental groups who were plaintiffs in the lawsuit cheered the court ruling, and said it should encourage Keystone’s developer, TransCanada, to scrap the project.

“This proposed project has been stalled for nearly a decade because it would be all risk and no reward, and despite the Trump administration’s efforts, they cannot force this dirty tar sands pipeline on the American people,” said Sierra Club Senior Attorney Doug Hayes. “It’s time for TransCanada to give up on their Keystone XL pipe dream.”

How we got there: The requirement for a lengthier environmental review comes after Nebraska regulators last year approved an in-state permit for Keystone XL, the last major regulatory hurdle facing the project. But they rejected TransCanada’s preferred route, approving an alternative that would move the pipeline further east.

The $8 billion Keystone XL pipeline would send oil from Canada’s Alberta oil sands to Steele City, Neb., and then on to refineries along the Gulf Coast. But it has been challenged by environmental advocates worried about spills and climate change.

The Obama State Department considered the application for seven years before President Barack Obama rejected it in November 2015, a month before signing the Paris climate change agreement.

The Trump administration granted a cross-border permit in March, but the pipeline still needed approval by the five-member Nebraska Public Service Commission to be built in the state.

What happens now: TransCanada has not officially made a decision on whether to commit to investing in the project, as it debates whether it’s still economically viable for the company after years of delays.

Still, the developer hoped to begin preliminary work this fall on the pipeline in Montana before starting construction in 2019.

CHAMBER SAYS CALIFORNIA WILL SAVE THE MOST FROM TRUMP’S TAX CUTS: California consumers will save at least $3 billion on their energy bills over the next five years due to Trump’s December tax cuts, the Chamber of Commerce announced in releasing a new study on Thursday.

California is the big winner, but the energy saving are projected to spread across the U.S., as utilities use the corporate tax cuts they received as a rebate on customers electricity bills, according to the Chamber’s Global Energy Institute.

COAL STATE OFFICIALS CALL ON PERRY TO STOP POWER PLANT CLOSURES: Former state utility commissioners from 10 coal states are pressing Energy Secretary Rick Perry to order power plants not to close until a study on their national security benefits is done.

Closures over the next five years: The commissioners argue that 29,000 megawatts of coal-fired power plants are slated to close over the next five years. “It is extremely important that these plans do not move forward until the impacts on grid resilience, fuel supply and generation, nationally and within regions, have been fully assessed and better understood,” the letter read.

Perry can order plants to stay open: The letter suggests that Perry could order the power plant owners and the grid operators that oversee them to ensure that the coal plants can still generate and function even though they are not economic when compared to natural gas power plants.

Natural gas vs. coal: Natural gas is dominating the electricity market because of its low cost. But the commissioners argue that coal is more important for national security because fuel can be stored onsite and supply disruptions can be avoided.

The commissioners on the letter hail from West Virginia, Kentucky, Wyoming, Indiana, North Dakota, Montana, Tennessee, Missouri, Alabama, and Florida. Most of the states are reliant on coal, but are in some stage of transitioning to natural gas.

SENATORS PRESS NOMINEE FOR ENERGY DEPARTMENT LAWYER ON COAL BAILOUT: Senators of both parties on Thursday morning questioned Trump’s nominee to be the Energy Department’s top lawyer on whether he would support the administration’s efforts to subsidize failing coal and nuclear plants.

William Cooper, Trump’s pick to be DOE’s general counsel, said he would wait to see the administration’s evidence for the necessity of rescuing coal and nuclear before making a legal judgment.

He’s waiting for ‘the facts’: “A lot of times these things turn not on what the law says, but what the facts are,” Cooper testified to the Senate Energy and Natural Resources Committee, in his confirmation hearing.

He later added: “My role would be to advise the department on the law and ascertain what the facts are, and at the present I don’t know what the facts are.”

That answer did not satisfy Maria Cantwell of Washington, the committee’s top Democrat.

“I get you’re going to have to look at the language, but we need the president to stop proposing to raise everyone’s cost of electricity by mandating coal,” Cantwell said.

Still bracing for action: In January, the Federal Energy Regulatory Commission unanimously rejected a proposal from Energy Secretary Rick Perry to provide special payments to coal and nuclear plants at risk of retirement for their ability to store fuel on-site for 90 days.

Now, the Energy Department, on the orders of Trump, is considering a new proposal, potentially using executive national security powers to force wholesale power operators to buy power from a list of coal and nuclear plants deemed “critical” to the grid.

“It is general counsel’s job to keep [DOE] within the bounds of the law,” Cantwell told Cooper.

SENATORS SEEK TRUMP SUPPORT FOR DOE’S RESEARCH PROGRAM: Senators of both parties also had tough questions for Trump’s nominee to lead the Energy Department’s innovation and science research program.

In his fiscal 2019 budget, Trump proposed to eliminate the Advanced Research Projects Agency-Energy, or ARPA-E, for the second year in a row, despite its strong support in Congress. Congress has rejected the proposed budget cuts.

“I’d like to think you’d aggressively advocate for a strong budget,” Committee Chairwoman Lisa Murkowski, R-Alaska, told the nominee, Lane Genatowski.

And the nominee says: “If confirmed, I would be an enthusiastic supporter of ARPA-E and all their projects to continue moving forward,” Genatowski assured during his confirmation hearing.

“Not one minute was I talked to about closing it up,” he later promised Joe Manchin, D-W.V., who asked whether Trump nominated him to “put the nail in the coffin” of ARPA-E.

Senators also expressed concern about Genatowski’s background in banking, rather than science. He was an energy investment banker at JPMorgan Chase and Bank of America, among others.

Genatowksi promised he would respect science, saying “ARPA-E has a very talented group of scientists.”

SEC SUBPOENAS TESLA OVER ELON MUSK’S BUYOUT TWEETS: The Securities and Exchange Commission has subpoenaed electric-carmaker Tesla in an inquiry into founder Elon Musk’s Twitter posts about a plan to take the company private, the Wall Street Journal reported.

The subpoena, part of a probe into whether Musk’s statement that he had obtained the funding needed to offer $420 a share to take the Palo Alto, Calif.-based company out of publicly-traded stock markets, sought information from each member of the board of directors.

Tesla’s board said earlier this week that it had formed a special committee of independent directors to evaluate Musk’s proposal, but the company emphasized that it has yet to receive a formal offer.

What Musk was thinking: Musk, who first tweeted about a buyout in early August, shared further details in an email to company employees and blog posts on Tesla’s website. He said Monday that Saudi Arabia’s sovereign wealth fund, which holds a 5 percent stake already, has repeatedly recommended taking the company private and is interested in funding the deal.

His understanding from the investor that no other approvals were needed was the basis for his Aug. 7 tweet, in which he said that funding for the transaction had already been secured.

But turning to Twitter is problematic: Corporations making such announcements typically do so via press release, not on social media.

Tesla has been under pressure to attain profitability and generate cash and has faced production bottlenecks of its first mass-market electric vehicle, the Model 3.

INTERIOR DETAILS PLAN TO ALLOW DRILLING IN UTAH MONUMENT TRUMP SHRUNK: The Interior Department’s Bureau of Land Management released draft plans Wednesday to allow coal mining or oil and gas drilling in nearly 700,000 acres that Trump removed from Utah’s Grand Staircase-Escalante National Monument.

Change of plans: Environmental groups blasted the Trump administration for proposing to allow energy development in areas where it was previously prohibited.

“The BLM’s proposed management plan for the lands President Trump unlawfully carved out of the Grand Staircase-Escalante National Monument is not only illegal, but sets the stage for the destruction of this unique landscape that has been protected for more than two decades,” said Southern Utah Wilderness Alliance legal director Stephen Bloch.

The Bureau of Land Management also posted a draft management plan for Utah’s Bears Ears National Monument, which Trump also shrunk.

What Trump did: Trump on Dec. 4 signed a proclamation cutting Bears Ears by more than 1.1 million acres, or 85 percent, and creating two smaller monuments instead.

Trump also slashed the 1.9-million-acre Grand Staircase-Escalante monument, designated by President Bill Clinton in 1996, nearly in half.

Multiple environmental groups and Native American tribes have sued the Trump administration over both actions, arguing the president abused beyond his power, but the courts have not acted on the legal challenges yet.

Trump acts first: But the posting of the draft management plans shows the Trump administration is not waiting for a court outcome.

The BLM’s preferred plan for Grand Staircase proposes selling 1,600 acres of land that was previously part of the monument.

The area formerly protected in Grand Staircase has known coal reserves.

BLM’s proposal for Bears Ears, meanwhile, does not focus on energy development, because there is limited opportunity for oil and gas drilling in the area.

RUNDOWN

Politico The key to Trump’s climate reversal? New math

E&E News A coal company and Interior teamed up to save a power plant

Wall Street Journal Turkey’s energy bill soars as its currency tumbles

Bloomberg Canada, U.K. plan the first Paris climate deal carbon trades

Reuters Texas, refineries urged to plan storm shutdowns to cut pollution