Energy Update: Week of April 10

Energy Update - April 10, 2017


Now THAT was a riveting finish to the Masters.  It was incredible how each played down the stretch until the very last regulation putts on 18 when each missed shorties.  That pressure is just crazy…  As a long-time golf watcher, it is great to see Sergio Garcia finally pull one out on the first extra hole  Another great set of days at Augusta National.

And with the close of the regular NHL season yesterday, the real season begins: the Chase for the Stanley Cup.  But before we think about that, there is one matter of business with the Detroit Red Wings missing the playoffs for the first time in 25 years.  It means that the last game was played in the Joe Louis Arena, one of hockey’s new/old sacred barns.  Proud to have been there for many games from 1980 until I could take my kids in 2015.  As for playoffs, I like the caps, but the Rangers and defending Champs, Pittsburgh remain factors…and who knows what Columbus is capable of in the East.  As for the West, Chicago is strong and St. Louis is probably the hottest team in the NHL since Mike Yeo took over as coach. In the end, the Chicago Cubs have won the World Series, the Cleveland Cavaliers have won an NBA title and Sergio Garcia has won a major in golf. It seems like this lays the ground work for the Washington Capitals or St. Louis Blues to win the Stanley Cup.

Happy two-week long recess. Passover begins today at sundown and Easter is coming up on Sunday.  It has been a crazy trip since late last year.   And this is our first real break (maybe, who knows).  My whereabouts are unknown this week, but I’m still monitoring the action from my secret locale.  Hints: I will not be close to Rick Perry, who is at the G-7 energy ministers meeting in Rome, but they have held a UN climate meeting here…  Winners can get a souvenir.

In DC this week, not much, but today, Neil Gorsuch formally becomes the newest member of the U.S. Supreme Court.  Chief Justice John Roberts swears in Gorsuch at 9 a.m. at the court, followed by Justice Anthony Kennedy doing the honors at an 11 a.m. event in the Rose Garden.  Keeping our eyes on FERC as the delay in getting new Commissioners is starting to have some Impacts according  to a number of media sources.

There has also been a lot of banter this past week about the Paris Climate agreement (small “a”) and its relationship to the Executive Order dealing with the Clean Power Plan and any potential change to the Endangerment Finding.  In response to several questions, my colleague Scott Segal produce a great analysis that I am happy to share with you in memo/pdf form.  Let me know if you want to see it and I will forward.

Finally, our friends at EIA today said U.S. energy-related CO2 emissions fell 1.7% in 2016. U.S. energy-related carbon dioxide (CO2) emissions in 2016 totaled 5,170 mmt.  In 2015, the same emissions dropped 2.7%.  EIA says the recent decreases are consistent with a decade-long trend, with energy-related CO2 emissions 14% below the 2005 level in 2016.  See more charts/data here.

Enjoy your family time on this holiday week.  Call with questions…



Frank Maisano

(202) 828-5864

(202) 997-5932



“Widespread public sector investment in basic energy technology is critical to complement private investment and drive long-term economic growth in America and globally. With new energy markets only set to grow, technological breakthroughs can generate enormous economic dividends while providing the lower cost, cleaner energy the world needs.”

BPC American Energy Innovation Council member Michael Graff, chairman and CEO American Air Liquide upon the release of AEIC new Innovation report last week.



Innovation Report Highlights Role As Driver of Growth – The Bipartisan Policy Center’s American Energy Innovation Council released a new report saying America must embrace its unique abilities to innovate as a way to revitalize our economy and enhance its security.  All-the-while it will also help American industry play a stronger role in providing clean, affordable, and reliable energy. The report says access to reliable, affordable energy has such a profoundly positive impact on people’s lives. Yet unlike many other technology sectors, the energy sector in particular has suffered from underinvestment in research and development (R&D). As a generally low-cost commodity, it is often difficult for an energy supplier to differentiate itself and charge a premium, the way products in other markets can. Energy infrastructure and technologies are also generally high cost and long lived, leading to large amounts of inertia and, in some cases, risk avoidance. Further complicating these challenges is the fact that energy markets are highly fragmented and often face a significant amount of regulatory fracturing and uncertainty. The AEIC was formed in 2010 and consists of ten corporate leaders who share a common concern over America’s insufficient commitment to energy innovation.  Among these CEOs include Air Liquide’s Mike Graff, Southern’s Tom Fanning and Dominion’s Tom Farrell.

Matheson Names to FCC Advisory Board – Federal Communications Commission Chairman Ajit Pai today appointed National Rural Electric Cooperative Association (NRECA) CEO Jim Matheson and 28 others to serve on a newly created Broadband Deployment Advisory Committee (BDAC).  “Access to high speed Internet is a key ingredient for a healthy 21st century economy, particularly in rural America,” Matheson said.  “I’m honored and excited to sit on this committee, and I look forward to representing the interests of rural America as we work to close the digital divide.” The committee will meet for the first time on April 21, 2017.  Its mission is to advise and make recommendations to the FCC on how to accelerate the deployment of broadband by reducing and removing regulatory barriers to infrastructure investment. A full list of BDAC members can be found here.

ACI praises Legislation to Remove Animal Fat Tax – The American Cleaning Institute (ACI) praised legislation introduced by U.S. Rep. Randy Weber (R-TX) that would permanently put a stop to federal tax credits for biofuels produced with animal fats, according. ACI, the trade association for the cleaning product supply chain, says the bill (H.R. 1866, the “Animal Fat Tax Act”) would prevent the renewal of tax credits for biodiesel and renewable diesel that is produced from animal fats, which until the end of 2016 were eligible for a $1 per gallon tax credit. ACI’s member companies include the producers of oleochemicals, such as fatty acids and alcohols made from seed oils and animal fats, historically used in soaps and detergents. The biofuel subsidy in question distorts the domestic market for animal fats by diverting this important raw material away from use in the manufacturing of cleaning products and towards the production of biodiesel. As a result, animal fats have seen a 116% increase in cost since 2006, the year the tax credit first became law.

CCS Group Praised Legislation Sponsors – The National Enhanced Oil Recovery Initiative (NEORI) praised Sens. Rob Portman (R-OH) and Michael Bennet (D-CO) for introducing bipartisan legislation to accelerate the deployment of carbon capture technologies at power plants and industrial facilities. Similar legislation was introduced in the U.S. House by Representatives Carlos Curbelo (R-FL) and Marc Veasey (D-TX).  The Carbon Capture Improvement Act will authorize states to use private activity bonds to help finance the purchase and installation of carbon capture equipment. Private activity bonds are widely used to help develop U.S. infrastructure, such as airports and water and sewer projects, including through public-private partnerships. The bonds will reduce financing costs for carbon capture projects because interest payments to bondholders are exempt from federal tax and the bonds typically have longer repayment terms than bank debt.  Access to private activity bonds, together with extension and reform of the Section 45Q tax credit, will give carbon capture project developers another important incentive in what NEORI members hope will be a toolkit of financing mechanisms enacted as part of comprehensive tax reform legislation expected to be considered by Congress later this year.

Advance Energy Report Underscores Gains – The 5th annual Advanced Energy Now 2017 Market Report focused on the size, growth, and trends in the advanced energy market, globally and in the United States. The report features 17 stories on the trends that are driving advanced energy growth – and making the energy we use secure, clean, and affordable. This year’s edition shows global growth of 7% from 2015 to 2016, nearly twice the rate of the world economy overall.  In 2016, advanced energy represented a $1.4 trillion global market and a U.S. market of $200 billion. The advanced energy industry is also a major employer, supporting more than 3 million U.S. jobs. That’s equal to the employment provided by retail stores, and twice the jobs in building construction.

Global Renewable Growth Strong – New research by the United Nations and Bloomberg New Energy Finance says countries added record levels of renewable energy capacity in 2016 even as investment fell.  Most of the success has been due to reduced costs.  While the investment of $241.6 billion in renewable energy capacity (excluding large hydropower) was the lowest level since 2013, it was roughly double the investment in fossil fuel generation.  New renewable capacity accounted for 55% of all new power.  According to the new report that is the highest percentage ever.  Renewables including wind, solar, biomass and waste-to-energy added 138.5 gigawatts to the global power capacity in 2016, up by 8% over last year.  Solar investment was down by 34% from 2015, while capacity additions rose to an all-time high. Wind investments were down by 9%, and capacity additions fell to 54 GW from a high of 63 GW in 2015. A bright spot was Europe’s investment in offshore wind.  The share of renewables grew to 11.3% of electricity worldwide, from 10.3% the previous year, excluding large hydro. Winning bids for solar and wind “at inconceivably low” tariffs in auctions gave another boost to renewables, said the report.



Electric Power Conference Set for Chicago – The 19th annual Electric Power Conference will be held In Chicago today through Thursday at McCormick Place.  Sponsored by POWER magazine, the event provides a platform for power generation professionals to meet, network, and address the critical issues facing the power industry.

Atlantic Council Report to Look at Oil Theft – The Atlantic Council’s Global Energy Center will hold a forum today at 12:30 p.m. for a discussion about how hydrocarbons crime impacts global security, the market, the environment, and communities around the world, and how stakeholders can work together to address this under-recognized issue.  The will also release a report, Downstream Oil Theft: Global Modalities, Trends, and Remedies, by Dr. Ian M. Ralby, is the first major study of refined oil theft around the globe. Launched at the Atlantic Council Global Energy Forum in Abu Dhabi in January, this report explores the many ways that hydrocarbons crime presents a threat not only to local and regional prosperity, but also to global stability and security. Following up on this study, Dr. Ralby has written an additional report outlining the steps that need to be taken to effectively address this issue.

EESI Forum to Look at Foreign Aid, Climate Help – The Environmental and Energy Study Institute (EESI) holds a briefing tomorrow at 3:00 p.m. in 485 Russell discussing benefits to the United States from deploying foreign aid to vulnerable regions to help them become more resilient to climate change impacts. The briefing will also explore the inner workings of the Green Climate Fund (GCF), a multi-lateral effort to mobilize $100 billion in public and private financing for adaptation and mitigation projects in developing nations.

Wilson Event to Look China Energy Finance – The Wilson Center will host a forum on Thursday at 9:30 a.m. to look at China Energy Finance investments.  Since 2000, the China Development Bank and the Export-Import Bank of China have emerged as major global funders of energy infrastructure providing upwards of $160 billion in energy finance to governments across the world. To better understand the size and types of this energy investment, Kevin Gallagher and his research team at Boston University have launched a new interactive China’s Global Energy Finance database that tracks international energy investments by Chinese banks.  The database has revealed that nearly 80% of Chinese bank investment goes into power plant construction -two-thirds of which were coal plants. Besides presenting insights from the database, Dr. Gallagher will discuss how Chinese energy finance compares to other global energy financiers. Dr. Wang Yan (Peking University) will put this energy financing in a larger context by explaining the non-concessional finance approach China’s global banks are taking to promote industrial and infrastructure development around the world. Paulina Garzon will provide examples of positive and negative impacts that Chinese energy investments are having on communities in Latin America.

Forum to Look at New Fuel Economy Approaches – The R Street Institute will host a panel discussion of these recent developments in fuel economy regulations, the existing triune approach to it and what alternatives the future might hold on Friday at 12:30 p.m.  Speakers will include CEI’s Marlo Lewis, AAM’s Chris Nevers, Rod Richardson of the Grace Richardson Fund, Wayne Winegarden of the Pacific Research Institute and R Street’s Ian Adams.



Energy Storage Conference Set for Denver – The 27th Energy Storage Association annual conference and expo will be held on April 18-20 in Denver, Colorado.  Keynote speakers and expert panelists on the program include Colorado Governor John Hickenlooper, RES CEO Ivor Catto, former CO Gov Bill Ritter and NextEra Energy exec Michael O’Sullivan.

CSIS Forum to Look at Global Development – The Center for Strategic and International Studies (CSIS) will host its 3rd annual Global Development Forum (GDF) on Wednesday April 19th. The GDF will feature over 40 speakers, including key stakeholders from U.S. government agencies, leading multilateral and non-governmental organizations, foreign governments, and the private sector. The forum examines the role and purpose of official development assistance against a backdrop of rising incomes, economic growth, youth unemployment, and other continued complex challenges in many parts of the world. To address these challenges, the next U.S. administration will need to apply new approaches and remain highly flexible in a rapidly changing development landscape. In particular, this conference will explore ways in which the next few years will shape the role of the United States in international development, and how the United States can work with official donors and key partners, including the private sector, civil society, and multilateral institutions. The two keynote speakers will be Admiral William J. Fallon (ret.), former Commander of U.S. Central Command and Asian Development Bank President Takehiko Nakao.

AEE Webinar to Look at State Policy Questions – The Advanced Energy Economy (AEE) will host a webinar on April 19th at 1:00 p.m. looking at creating markets for advanced energy at the state Level.  Whatever might be happening at the federal level, states are taking the lead in creating markets for advanced energy. AEE’s State Policy Program seeks to maintain this momentum by working with our coalition of State and Regional Partners and our business members to promote advanced energy legislation in statehouses around the nation. During this webinar you will hear from policy experts who have intimate knowledge of the latest legislative developments in the following states: California: Cap & Trade, Storage, Transportation; Nevada: Retail Choice Issue, Legislative Update; Texas: Legislative Tax Issue, PUCT Regulatory Proceeding on Data Access; Virginia: Access to Advanced Energy, Legislative, and Regulatory Update.

Bloomberg New Energy Summit Set – The annual Bloomberg New Energy Finance Future of Energy Summit will be held on April 24th and 25th in New York. The Future of Energy Summit is the premier invitation-only forum at the nexus of energy markets, industry, finance, and policy. It is a year-round, global experience powered by Bloomberg New Energy Finance’s cutting edge research team, as it explores the shifting forces in the energy system and defines the implications for the energy community.

Water Power Conference Set for May – Waterpower week in Washington will be May 1st through 3rd, providing three great conferences into one when IMREC, METS and NHA’s Annual Conference are held at the Capital Hilton.  The event will discuss policy changes in the hydro and marine industry in an all-in-one event. The event highlights perspectives on the role of hydro, explores issues affecting hydro and marine resources, and helps participants develop a future game plan to meet challenges and ensure the future sustainability of the hydro and marine industry.