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LNG EXPORT TENSIONS: Whether the Biden administration likes it or not, the U.S. solidified its position last year — even amid a pandemic — as a top exporter of natural gas.
The International Gas Union’s World LNG Report, released this morning, finds the U.S. exported 44.8 metric tons of liquified natural gas, or LNG, in 2020, the third most of any country behind Qatar and Australia.
U.S. LNG exports increased 33% from 2019, the largest growth in the world.
Sindre Knutsson, vice president of gas markets at Rystad Energy, a research group, told Josh he expects even more growth in U.S. LNG exports this year, by up to 50%. Rystad expects the U.S. to be the top exporter of LNG globally by 2024.
This could get awkward for Biden: The Trump administration boasted of the U.S.’ emerging status as an LNG export power, and actively promoted sending natural gas to Europe to reduce dependence on Russia.
Knutsson said he hasn’t seen “any change” in the bullish outlook for LNG despite the Biden administration’s murky stance on the role natural gas exports should play in the energy transition.
Most of the growth this year and into the future will come from increasing demand in Asian countries that are looking to diversify off dirtier coal while serving the energy needs of their growing populations. Sindre said he still expects Europe to steadily import LNG from the U.S., even as countries such as France apply more scrutiny to the emissions associated with the shale gas transported through the export facilities.
Where Biden stands: The administration, while not cheering for LNG exports, seems to see its potential, despite criticism from liberal climate activists who want the U.S. to stop sending all fossil fuels overseas.
In a recent briefing with foreign media, Jonathan Pershing, a State Department adviser to climate envoy John Kerry, said U.S. fossil fuel exports were “something that we are discussing,” but added “low carbon doesn’t necessarily mean no fossil fuel.”
“It does not serve anyone to cut things off,” Pershing added, citing a “need to maintain reliability and security in the existing grids.”
Energy Secretary Jennifer Granholm, meanwhile, committed in her confirmation hearing to follow federal law as it relates to approving applications for exporting LNG.
In written responses to the Energy Committee that oversaw her confirmation, Granholm said U.S. LNG exports can play an “important role” in reducing consumption of dirtier fuels, but also said she wants to work with the oil and gas industry to “reduce emissions associated” with LNG.
Granholm’s predecessor, Dan Brouillette, Trump’s last Energy secretary, told Josh the Biden administration should be more forceful in supporting, not just accepting, growth in LNG exports.
“The administration really needs to figure out its position on LNG because the developing world is demanding this clean fuel. It needs to work through that very quickly,” Brouillette said. “Like it or not, natural gas will be a large part of the clean energy transition and global energy demand for decades to come.”
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.
WYOMING’S ADVANCED NUCLEAR MILESTONE: Bill Gates’s TerraPower will build an advanced nuclear reactor demonstration project at a retiring coal plant in Wyoming, the state’s governor announced yesterday, a significant milestone for the budding zero-carbon technology.
According to TerraPower, the project will be a 345 MW fully functioning power plant demonstrating its Natrium technology, which would store excess energy in tanks of molten salt to help supplement wind and solar energy, which are variable, in periods of high demand. The Natrium plants will be cooled by liquid sodium.
“The purpose of it is to show the world this technology is ready for commercialization,” said Chris Levesque, TerraPower’s CEO, noting the project should begin delivering power within seven years. He added he expects the demonstration project will attract more utilities’ interest in Natrium technology before it’s even up and running.
Granholm, during remarks at the announcement, said the Biden administration is committing to building more advanced nuclear reactors, which it sees as a critical part of its climate agenda.
“I have a feeling Wyoming won’t be the only state angling for one of these nuclear reactors once we see it in action,” she said.
ANOTHER ONE FOR ENGINE NO. 1: Activist investor Engine No. 1 won a third seat on the 12-member board of ExxonMobil, the oil and gas giant conceded yesterday.
Exxon’s revelation that former Energy Department official Alexander Karsner earned a majority of votes from shareholders gives activists further leverage to press for the company to begin moving off fossil fuels and investing more in clean energy. Karsner is a former U.S. assistant secretary for energy efficiency and renewable energy and is currently senior strategist at X, formerly known as Google X.
Exxon had already announced last week that shareholders elected two Engine No. 1 candidates to the board: Gregory Goff, former chief executive of Andeavor, and Kaisa Hietala, an environmental scientist and former executive at Neste, a Finnish oil refining company that produces biofuels.
In a statement yesterday, Engine No. 1 said it is “excited” their three board members will be working “to help better position ExxonMobil for the long-term benefit of all shareholders.”
MANCHIN AND GRANHOLM’S WEST VIRGINIA ITINERARY: Granholm and Sen. Joe Manchin are focusing on promoting clean energy during their trip beginning today to his home state of West Virginia, in which they intend to “showcase the promise and potential of West Virginia in the changing energy economy.”
This afternoon, they will announce a new collaboration between a West Virginia manufacturer and the offshore wind industry, where they will be joined by Dominion Energy President & CEO Robert Blue and Ørsted Offshore North America CEO David Hardy.
Tomorrow, Granholm and Manchin will tour the National Energy Technology Laboratory Morgantown facility. They will also visit the West Virginia University Energy Institute for Rare Earth Elements Lab and announce new DOE funding for West Virginia-based energy projects.
REGAN IS ALSO IN FOSSIL FUEL COUNTRY: EPA Administrator Michael Regan is also on the road this week, visiting North Dakota for several meetings with energy, agriculture, environmental, and tribal groups.
Today, Regan will take part in a listening session including North Dakota Gov. Doug Burgum, Sens. Kevin Cramer and John Hoeven, Rep. Kelly Armstrong, and several state-level officials. He will also tour a brownfields property and cleanup project in Mandan and meet with environmental groups for a roundtable hosted by the Dakota Resource Council.
Tomorrow, Regan will meet with several leaders from tribal groups and visit the Fort Berthold Indian Reservation.
US OIL DEMAND FALLS: U.S. oil demand and gasoline consumption declined last week after two weeks of big gains due to the shutdown of the Colonial Pipeline.
Overall oil demand fell to 19.1 million barrels per day from nearly 20 million barrels p/d the previous week, the Energy Information Administration reported this morning, while gasoline consumption declined to 9.1 million barrels p/d compared to 9.5 million barrels p/d.
But oil prices are up today as the EIA also reported a large draw in crude inventory stocks of 5.1 million barrels.
CLOCK IS TICKING ON INFRASTRUCTURE DEAL: Republicans are considering another counteroffer on infrastructure after President Joe Biden met solo yesterday with lead GOP negotiation Sen. Shelley Moore Capito of West Virginia.
Capito said she will be briefing the other members of her negotiating team and reconnecting with Biden tomorrow. But the two sides remain hundreds of billions of dollars apart on infrastructure spending, according to Punchbowl News, and Biden is sticking by his interest in tax increases to pay for it, despite Republican opposition.
Climate activists, meanwhile, continue to call for Biden to move to a more clean energy-centric reconciliation package as he’s continually extended the deadline to reach a narrower bipartisan deal.
“Capito proposal has zero for clean energy, zero for clean cars, would break international climate commitments and campaign environmental justice commitments,” tweeted Jamal Raad, executive director of Evergreen Action. “When will the White House acknowledge this is going nowhere?”
HOW TEXAS CAN AVOID FUTURE BLACKOUTS: Five former Texas public utility commissioners and a senior regulatory adviser are calling on state policymakers to go further than a measure the legislature sent to the governor this week that would require the commission to adopt winterization standards to ensure power plants are equipped for colder temperatures.
In a report this morning, released by the Energy Foundation and the Cynthia and George Mitchell Foundation, the former PUC officials say the legislation is a good first step, but might not be enough to ensure natural gas delivery infrastructure is also adequately and quickly weatherized.
The PUC commissioners also recommend several other steps, such as overhauling how outages are managed and rotated and improving the energy efficiency of the state’s homes and buildings. For example, the report notes if the more than 60% of Texas homes that are heated with electricity had energy-efficient building shells and heaters, electricity demand would have been at least 15 gigawatts lower, enough to “offset the loss of most of the generators that failed on February 14 and 15.”
In addition, the former commissioners encourage better management of information about how the power system is operating. That includes improved forecasting for the Electric Reliability Council of Texas (or ERCOT), the state’s grid, and more transparency around the investigations into the blackout and routine data on grid and fuel supply failures.
BIDEN’S MOVE ON ANWR PUTS MURKOWSKI IN PICKLE: Biden and his administration have assiduously courted Sen. Lisa Murkowski, with some success, as they look for leverage in the split Senate. Just last week, the Biden administration confirmed it will continue to defend the Willow oil and gas project in the National Petroleum Reserve-Alaska in federal court, in what some saw as a bow to Murkowski.
But their recent move suspending all oil and gas leases in the Arctic National Wildlife Refuge puts the Alaska Republican in a tough spot heading into reelection, the Washington Examiner’s Kerry Picket writes.
With Alaska’s economy dependent in part on oil and gas exploration, including annual checks to residents from drilling, it’s a sensitive issue for any statewide officeholder, and particularly for Murkowski, who faces reelection in 2022.
Without leasing, Murkowski, facing MAGA loyalist Kelly Tshibaka in the Republican primary, may have a harder time championing a provision she co-authored in a 2017 GOP tax cut law that opened a 1.5-million-acre coastal section of Alaska’s ANWR to oil drilling.
BIDEN WAIVING OF NS2 SANCTIONS ‘TERRIBLE’ FOR UKRAINE: Biden’s decision to waive sanctions on the Russian company in charge of constructing the Nord Stream 2 natural gas pipeline is a blow to the Ukrainian economy that will strengthen Russia’s ability to wield its influence against the Eastern European partner, Ukrainian security analysts told the Washington Examiner’s Abraham Mahshie.
The Russian pipeline that would transport gas through the Baltic Sea to Germany would displace older Ukrainian pipelines that generate an annual revenue worth around $3 billion.
“It’s terrible for Ukraine,” said former Ukrainian national security council member Oleksandr Danylyuk.
“Russia knows how to use gas as a political weapon, and it’s a new leverage in Europe,” he added at a meeting in his office.
The former finance minister and security adviser under President Volodymyr Zelensky said Biden’s move sends the wrong message to Russian President Vladimir Putin.
In choosing not to sanction the Russian-owned Swiss company overseeing construction and its CEO, the Biden administration invited criticism that it is being soft on Russia as it looks to rehab relations with Germany and Europe
“Unless you take it serious, Russia will always win,” he said. “For Biden, it is important to get Germany on board now, and he has his own plans, unfortunately.”
UNITED STATES TEAMS UP WITH FOUR NATIONS TO PROTECT OCEAN HABITATS: The United States is joining the United Kingdom, Chile, Costa Rica, and France in a new global partnership to elevate marine protected areas as a method to curb greenhouse gas emissions and strengthen resilience to climate change effects.
Marine protected areas are portions of ocean habitat set aside for conservation purposes, restricting human activity in those areas. The new partnership will seek to use those marine protected areas as a way to curb climate change. For example, the regions often protect habitats of salt marshes, seagrasses, and mangroves that can store carbon dioxide.
“Marine protected areas — but especially highly protected ones — are an effective nature-based solution for adapting to and mitigating climate change and conserving biodiversity,” said Jane Lubchenco, deputy director for climate and environment at the White House Office of Science and Technology Policy.
The Rundown
Politico With GOP circling, Ossoff leans into climate change
Bloomberg EU eyes first-of-a-kind border levy in climate fight
New York Times A 20-foot sea wall? Miami faces the hard choices of climate change
Wall Street Journal Copper boom Has BHP, Freeport picking through waste
S&P Global Capacity prices down 64% in PJM’s first auction in three years
Calendar
TUESDAY | JUNE 8
10 a.m. 366 Dirksen. The Senate Energy and Natural Resources Committee will hold a hearing to consider the nominations of Tracy Stone-Manning to be director of the Bureau of Land Management, Shalanda Baker to be director of the office of minority economic impact at the Department of Energy, Samuel Walsh to be general counsel at the Department of Energy, and Andrew Light to be an assistant secretary of energy for international affairs.
10 a.m. SD-342 Dirksen. The Senate Homeland Security and Governmental Affairs Committee will hold a hearing titled, “Threats to Critical Infrastructure: Examining the Colonial Pipeline Cyber Attack.”
1:05 p.m. Energy Secretary Jennifer Granholm delivers remarks on her vision for nuclear energy at the Nuclear Energy Institute’s Nuclear Energy Assembly.
WEDNESDAY | JUNE 9
10 a.m. 301 Russell. The Senate Environment and Public Works Committee will hold a hearing titled, “PFAS: the View from Affected Citizens and States.”
