A long-awaited review of the nation’s energy infrastructure released Tuesday could add 1.5 million jobs through upgrades to how the United States transmits, stores and distributes fuel and electricity, the Obama administration said.
The first installment of the Energy Department’s Quadrennial Energy Review assessed vulnerabilities and needed improvements to U.S. energy infrastructure. The review, modeled after a similar Defense Department effort, was first called for in 2010.
The effort drew from 22 federal agencies and is intended to give policymakers unbiased information to inform potential legislation for modernizing energy systems. It also is meant to guide the private sector, which owns most of the infrastructure covered in the report, and the state and local governments that have regulatory jurisdiction over that infrastructure.
John Holdren, director of the White House Office of Science and Technology Policy, said he thought the endeavor would outlast President Obama’s tenure because it would be updated annually and tied together at the end of the four-year period.
“The country’s energy policy has not really been thoroughly reviewed for a long time,” he told reporters in a Tuesday conference call.
House Republicans quickly pushed back against the administration, as they noted the lower chamber has passed a trio of bills with bipartisan support that would allay concerns regarding infrastructure.
“If the Administration is serious about securing our energy future, a good start might be with the bipartisan bills passing out of the House,” Matt Sparks, a spokesman for House Majority Leader Kevin McCarthy, R-Calif., said in a memo to reporters.
One is a bill Obama vetoed that would have approved the Keystone XL pipeline. The project, which would take oil sands from Canada to the Gulf Coast, wasn’t mentioned in the Quadrennial Energy Review. Other legislation include one to shorten pipeline permitting reviews and another to expedite approvals of natural gas exports to countries that lack a free-trade agreement with the U.S.
Both chambers are working on comprehensive legislation regarding energy infrastructure, supply and efficiency that could either roll in some of the items outlined in the Quadrennial Energy Review or use different approaches. Energy Secretary Ernest Moniz said in February that conversation with the GOP committee chairs spearheading those bills were “encouraging” and that they had a “specific interest” in the report.
Dan Utech, Obama’s top energy and climate adviser, said that the administration has pilot programs in place to speed permitting periods for energy infrastructure. But Utech wouldn’t commit the White House to changing or shortening the overall National Environmental Policy Act review process, nor did he render a verdict on legislation the House has already passed.
“We are eager to engage with Congress and see where we can find common ground,” Utech said.
The report said energy infrastructure has undergone significant change in recent years: Renewable energy growth has necessitated investments in transmission lines used to carry bulk power to distribution utilities; a boom in domestically produced oil and natural gas has compelled rethinking of how producers ship fuel across the country and whether to send it overseas; ports and coastline infrastructure need strengthening to withstand risks posed by climate change and extreme weather that’s linked to it.
“The U.S. energy landscape is in a time of transition. The relevant trends include dramatic changes in the pattern of domestic coal, petroleum, and natural gas production; a drastically altered outlook for energy imports and exports; large increases in electricity generation from wind and sunlight; and an increased priority on moving rapidly to reduce greenhouse gas (GHG) emissions from the energy sector,” the report said.
Aging infrastructure must also be addressed, the report said.
“More than a decade ago, a Department of Energy (DOE) report pronounced the U.S. electricity grid ‘aging, inefficient, congested, and incapable of meeting the future energy needs of the information economy without significant operational changes and substantial public-private capital investment over the next several decades.’ … [T]he basic conclusion of the need to modernize the grid remains valid,” the report said.
The report offered some suggestions for mending the nation’s energy infrastructure.
It proposed offering financial assistance to states that encourage accelerated natural gas pipeline replacement, an effort that would cost up to $3 billion over 10 years. Leaky natural gas distribution pipelines running underneath cities could yield explosions, and they also increase greenhouse gas emissions that scientists say warm the planet. Some, but not all, states already engage in targeted pipeline upgrade schemes.
The report also recommended $3.5 billion of spending over 10 years in “smart grid” technology to modernize the electric grid. Those improvements would include monitoring devices that can alert utilities to potential cyberattacks and sensors that could allow for faster absorption of off-grid energy to smooth power supply and demand curves.
A federal grant program designed to create more space for crude oil on rail transport lines would also smooth disruptions for getting agricultural commodities and fuel to market, the report said. It suggested such an effort would cost up to $2.5 billion over 10 years while driving up to $5 billion in nonfederal investment.
The Strategic Petroleum Reserve, a cache of 691 million barrels of oil used for smoothing economic emergencies, also needs an update, the report said.
Stress tests last year revealed deficiencies in distributing the oil because the increase in domestically produced fuel has changed pipeline flows. The report recommended up to $2 billion in investment to fix those and other problems — $257 million of that pot was included in Obama’s fiscal 2016 budget proposal.
The report also suggested changing under what circumstances the Strategic Petroleum Reserve could be used. The reserve was originally conceived as a way to keep U.S. refineries in times of short supply, but the report said it should be used to respond to global oil market disruptions.
The White House also announced Tuesday that it would work with 17 private electric utility companies, such as Dominion Virginia Power and Con Edison, on enhancing resilience to extreme weather linked to climate change. The Agriculture Department also issued $72 million of loans for rural electricity projects, such as adding smart grid technology, upgrading transmission lines and adding solar power.
