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NET-METERING BATTLE ON HOLD FOR NOW: The Federal Energy Regulatory Commission voted unanimously Thursday to reject a petition that would have essentially upended state net-metering rules that credit customers that generate their own electricity for the energy they add to the grid.
The rejection is a victory especially for the rooftop solar industry, which relies on supportive net-metering policies to encourage more people to install solar panels on their homes and businesses. The petition in question, brought in April by the New England Ratepayers Association, argued net-metering is subject to FERC’s jurisdiction, instead of the states.
Such a shift in regulatory oversight would have undermined net-metering programs around the country. That prospect generated an intense amount of opposition, not just from solar companies and clean energy advocates, but also from state utility regulators, conservative groups, and Republican policymakers whose states have seen a solar energy boom.
This might not be the end of the issue: FERC rejected NERA’s petition on procedural grounds, saying it didn’t “identify a specific controversy or harm that the commission should address in an order,” Chairman Neil Chatterjee (who is celebrating a birthday today) said during the commission’s Thursday meeting.
Some of the other GOP commissioners, however, suggested FERC should still take up the merits of NERA’s petition to consider whether net-metering belongs in federal or state jurisdiction.
“Today’s order does not address any of the important substantive issues underlying the petition,” GOP Commissioner Bernard McNamee said. He opened the door for NERA or its allies to file a more specific complaint or rulemaking petition for the commission to consider the issue.
Fellow GOP Commissioner James Danly said he’d prefer FERC address jurisdictional questions over net-metering, too, raising concerns that the issue could end up in the court system if FERC doesn’t deal with it. “That could create an inconsistent state-by-state regime of conflicting rules that would take years to clean up,” Danly said.
Clean energy advocates will remain on edge: Especially since watchdog groups have suggested the true voices behind NERA’s petition aren’t New England ratepayers, but rather major utilities that oppose net-metering. Utilities, as well as their biggest trade group the Edison Electric Institute, were largely silent on the NERA petition.
“While we are gratified that today’s decision respects the Federal Power Act, we will continue to stay vigilant about protecting forward-looking state energy policies that deliver the pollution-free renewable power Americans want and deserve,” said Gregory Wetstone, head of the American Council on Renewable Energy.
Welcome to Daily on Energy, written by Washington Examiner Energy and Environment Writers Josh Siegel (@SiegelScribe) and Abby Smith (@AbbySmithDC). 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.
NO BIG SURPRISES IN TRUMP’S NEPA OVERHAUL: President Trump unveiled Thursday the first major changes to National Environmental Policy Act, or NEPA, regulations in decades, in a move that largely mirrors what the White House Council of Environmental Quality proposed in January.
Trump, speaking at the UPS Hapeville Airport Hub in Atlanta, touted the changes as “historic” and a “top-to-bottom overhaul” that “should have been done years ago.” Industry groups welcomed the changes, which they say will simplify and speed an environmental permitting process that has become too long and burdensome. Environmentalists, however, said the changes would cut out public input and essentially eliminate consideration of climate change.
The most noteworthy changes: The NEPA regulations set a deadline for completing environmental impact statements within two years and environmental assessments within one year. They also eliminate requirements to consider “cumulative” and “indirect” effects, a step environmentalists say allows projects to get away with not considering greenhouse gas emissions and climate change effects.
Trump hits Biden on climate: Trump painted presumptive Democratic nominee Joe Biden’s climate plans, just strengthened earlier this week, as a job-killer, especially for the oil and gas industry, and he suggested Biden is bowing to progressive pressure to move further to the left on climate.
“AOC and Bernie are in charge of energy,” Trump said, referring to Green New Deal author Alexandria Ocasio-Cortez and Bernie Sanders. “I don’t think Texas is too happy about that.”
FEDERAL JUDGE BLOCKS TRUMP REPEAL OF METHANE RULE: A federal court overturned a Trump administration rule Wednesday easing limits on venting and flaring of methane from natural gas on public lands.
U.S. District Judge Yvonne Rogers of the Northern District of California said the Bureau of Land Management’s weakening of the Obama administration’s Methane Waste Prevention Rule contained “myriad inadequacies” and “steamrolled” procedural requirements.
This looks familiar: Like other recent court rulings against Trump administration rollbacks, the judge said BLM violated the aforementioned NEPA along with the Administrative Procedure Act, by providing little evidence for its weakening of the methane rule and ignoring science on the consequences of the decision on greenhouse gas emissions.
“In its zeal, BLM simply engineered a process to ensure a preordained conclusion,” Rogers said.
How we got here: The Trump administration’s weakening of the methane rule, finalized in 2018, eliminated a requirement that oil and gas producers capture an increasing amount of vented or flared methane emissions. The rule also removed a requirement that oil and natural gas companies conduct regular leak inspections of compressor stations and pipeline infrastructure.
California and New Mexico filed suit, along with environmental and tribal groups.
Xavier Becerra, California’s Democratic attorney general, called the ruling “a step in the right direction” that is “crucial to addressing air pollution generated from California’s public lands.”
CERES URGES COMPANIES TO ALIGN LOBBYING WITH CLIMATE SCIENCE: Not doing so would exacerbate the systemic risks climate change poses to financial markets and essentially undercut companies’ efforts to manage the threats climate change poses to their own business, Ceres says.
The sustainable investment group unveiled a new blueprint Thursday for companies to align their lobbying with other internal efforts to curb emissions. Ceres asks companies to conduct a “climate audit” of their direct and indirect lobbying (i.e., through trade groups). For trade groups that don’t align with climate science, companies then have a few options to engage within the organization to shift its position or opt to leave the trade group, as some oil majors including BP have recently done with the oil refining group American Fuel and Petrochemical Manufacturers.
Investors are already demanding this: The level of investor interest in this issue has grown “leaps and bounds” in just the past few years, said Veena Ramani, senior director of Ceres’ capital markets systems program and lead author of the blueprint.
But Ramani noted a marked shift in the way investors are thinking about company lobbying on climate. While investors and advocates used to focus on smoothing inconsistencies between what companies were saying and what they were lobbying on, now they’re much more actively focused on pressuring companies to lobby on science-based policies, she told Abby.
Actions that aren’t aligned with climate science at the end of the day threaten the entire financial market, which ultimately “ricochets back” on all companies, Ramani said.
BROUILLETTE OFFERS NEW $$ FOR CLEAN VEHICLE TECHNOLOGIES: Energy Secretary Dan Brouillette announced Thursday $139 million in federal funding for 55 projects across the country supporting “advanced vehicle technologies.”
Brouillette unveiled the funding plan while visiting General Motors’ Estes Battery Lab and Design Center in Detroit, where GM is developing a Ultium battery, which will power its upcoming lineup of electric vehicles.
Projects receiving funding will help advance lithium-ion batteries using silicon-based anodes and develop smart EV charging technologies, among others.
POMPEO EXPANDS SANCTIONS AGAINST RUSSIA’S NORD STREAM 2: Secretary of State Mike Pompeo is warning that companies involved in building Russia’s Nord Stream 2 pipeline to Germany are subject to sanctions under the Countering America’s Adversaries Through Sanctions Act (CAATSA).
“Activities related to the Kremlin’s energy export pipelines are subject to U.S. sanctions – aiding and abetting Russia’s malign influence projects will not be tolerated,” Pompeo tweeted Thursday. “To firms and investors involved with the Nordstream 2 pipeline: Get out now or risk the consequences.”
The Trump administration has long lobbied against Nord Stream 2 for fear of increasing Europe’s dependence on Russian gas, and has been shipping more U.S. LNG to compensate.
Congress passed sanctions against the pipeline last year as part of the National Defense Authorization Act, but it did deter Gazprom, a Russian-controlled gas company, from moving to finish construction of Nord Stream 2. Senators led by Republican Ted Cruz and Democrat Jeanne Shaheen are expected to try to expand sanctions as part of the upcoming NDAA.
“The Kremlin will no doubt continue its frantic efforts to circumvent American sanctions, and so it is imperative that Congress provide the administration the broadest possible authorities to counter these ever-changing attempts at evasion,” Cruz said.
OPEC+ AGREES TO BEGIN EASING PRODUCTION CUT DEAL: Saudi Arabia-led OPEC and its allies led by Russia agreed on Wednesday to begin increasing their oil production in August, sticking to a scheduled tapering of production cuts agreed to as part of a historic agreement, even in the face of uncertainty about the coronavirus and what that means for oil demand.
OPEC+, as the collective is known, will ease their production cuts by about 1.6 million barrels per day in August, the Wall Street Journal and others reported, as the group of oil-producing nations projects optimism about the world’s economic recovery.
The decision comes after OPEC+ enacted a record production cut agreement of 9.7 million barrels per day (nearly 10% of global supply) in May, later extending it through July, in order to lift oil prices from a historic crash.
Oil prices have since stabilized at around $40 per barrel, far higher than the worst in April, but not high enough for many producers.
CHECK THAT…US OIL COMPANIES REPORT $48 BILLION IN WRITE-DOWNS: Low oil prices led to 40 U.S. oil producers collectively writing down $48 billion worth of assets in the first quarter of 2020, the Energy Information Administration reported Wednesday.
Writing down an asset means oil companies are acknowledging its oil assets are worth less than expected, with its value dropping below the cost of developing it.
Large European oil majors BP and Shell have also taken massive write-downs.
The 40 U.S. companies are also planning to spend much less this year, announcing total capital expenditures budgets of $33 billion, which for those companies, would be a 53% decline from 2019 levels.
DEMOCRATS COULD PICK UP VOTERS WITH CLIMATE FOCUS: POLL: Biden could attract more voters, including independents, center-right women, and other demographic groups that aren’t yet decided on a candidate, by touting aggressive action on climate change, according to new polling Thursday from the political group Climate Power 2020.
The survey, of more than 3,000 registered voters, found 71% of people support “bold” federal action on climate change, with 19% opposing. Climate Power 2020 notes 41% of those polled are Republican-leaning voters.
Climate Power 2020 says the poll proves that Biden could gain ground if he focused more heavily on climate change messaging. For example, the survey found a 35 percentage point gain for Democrats among center-right white women and a 33 percentage point gain among independents in swing states when the choice is framed on climate change.
The Rundown
Reuters Oil giants including Exxon set first joint carbon target
New York Times A heat wave, the coronavirus: double spikes of risk hit communities
Bloomberg Warren Buffet sees natural gas sticking around for a long time
Palm Springs Desert Sun California Resources Corp., leading oil and gas producer, files for Chapter 11 bankruptcy
Calendar
THURSDAY | JULY 23
10 a.m. 366 Dirksen. The Senate Energy and Natural Resources Committee holds a hearing to examine the impacts of the COVID-19 pandemic on users of public lands, forests, and national parks.
