Energy Update: Week of December 11th

Friends,

Out early today after spending all last week in Dubai at COP 28. It was a very busy first week at the climate meeting. The conference opened with a bang with agreements on loss and damage and final actions on other key issues like tripling renewables, advancing nuclear and limiting cooling emissions. Now the second week rolls on, starting with Climate Envoy John Kerry’s 80^th birthday TODAY. Maybe as a present, negotiators will find a way to address fossil fuels Phaseout/Phasedown. While this whole debate is interesting, the energy reality most of the globe faces underscores the fact that fossil fuels like natural gas and coal will be used for quite some time in the future, even as we expand renewables and advance new technologies like hydrogen. I only suggest this for all of you for context that often times is left wanting.

Speaking of hydrogen, there has been a lot of discussion on the timing and substance of the upcoming IRS guidelines for the 45V Hydrogen Production Tax Credit. White House Advisor John Podesta said it would NOT occur during COP, which ends Thursday. That means, perhaps we could see it as early as Friday, but I suspect it is more likely to emerge the week leading up to Christmas weekend.  It looks as though the WH/IRS will initially propose some restriction demanded by enviros in its initial decision but given the disagreements on its impact, it is unclear where this will land after what many expect to be a significant comment period. A key trigger will likely be strong pushback from big group of Congressional members (remember the Carper letter and Cantwell/Durbin-led 11 Senators letter demanding max flexibility) and certainly, the majority of the hydrogen industry will see this as a setback for the growth the marketplace. We are also monitoring for EPA’s PM NAAQS plan which also could emerge over the holidays.

Congress remains in town for the last real week of action before holiday distractions take control.  January 15^th’s budget deadline is not that far away. They are working on NDAA agreements and trying to find agreements on Ukraine/Israel funding and immigration as part of the action.

Other events for the week include today’s 1:00 p.m. CSIS Energy Security and Climate Change Program as COP28 wraps up with Kevin Book and Bloomberg Opinion’s Liam Denning. Just earlier today at Noon, US Energy Assn holds media briefing with a powerhouse panel of CEOs on the potential energy crisis unfolding in the nation's electricity supply. Tomorrow, the  US Energy Assn holds a briefing on US and North American lithium just before the Senate Energy Committee discusses two pieces of critical minerals legislation.

On Wednesday ACORE holds its annual Members’ meeting while CSIS looks at methane impacts of National Oil Companies, and on Thursday, USEA hosts a briefing with DOE's Sunita Satyapel and FCHEA’s Frank Wolak looking at hydrogen hubs and the expansion of Hydrogen.

Finally, as many of you know, I left Dubai to head to Argentina to umpire the Pan American Masters Field Hockey Championships in Buenos Aires.  Yesterday, I had the USA Over-35 Men against Argentina (who had 3 just-retired Argentine National Team players) which ended in a fast-paced, 3-3 tie.  So, I send this today to keep you updated for the week but I may be off-line some through Thursday. Still tracking things on email when I am not leaving my phone in an Uber in BA (yes, I did that but was able to quickly and thankfully recover it with the help and kindness of my Uber driver who actually walked around the field hockey complex looking for me after he found it – Oye)!!!

                                                                                                                                       

FRANKLY SPOKEN

"Focus on language rather than policy is an unwelcome distraction when it comes to fossil fuels."

Bloomberg Opinion Columnists Javier Blas on X saying no matter what language might be adopted, oil use will be higher in 2030 than today.

“The rigor that is going into this — the good, healthy differences of opinion between Treasury and DOE in coming at an issue and having that be arbitrated — is incredibly robust and helpful to the overall solution, all informed by different perspectives. With up to $3 per kilogram for the cleanest of hydrogen, that is a big tax incentive and we’ve got to get that right.”

Deputy Energy Secretary David Turk speaking about the 45V Hydrogen Tax Credit at a US Chamber of Commerce event at the COP28 climate summit in Dubai.

 

ON THE PODCAST

Madam Policy Takes on COP28 Issues from Leading Women – Kicking off Madam Policy’s COP28 in 8 series is Founding Executive Editor of Cipher and top national energy and climate reporter Amy Harder. Amy joins hosts Dee Martin and Carolyn Spector from Dubai for the 28^th UN Climate Change Conference, better known as COP28. Get the inside scoop from Amy about hot topics from methane reduction measures, the “investment gap,” the role of the oil and gas industry and more in this special episode of Madam Policy! Per usual, Amy is covering it all. Tune into this fast-paced episode and come back for the other quick convos that are part of our COP28 in 8 series.  The COP28 in 8 series is a mini episode series where we have 8-minute conversations with the women involved with COP28 in Dubai.

Renewable Podcast Looks at Hydrogen Announcement, COP – This week his Week in Cleantech is a new, weekly podcast covering the most impactful stories in cleantech and climate in 15 minutes or less. Produced by Renewable Energy World and Tigercomm, This Week in Cleantech will air every Friday in the Factor This! podcast feed wherever you get your podcasts. This week’s episode features Inside Climate News reporter Dan Gearino who breaks down plummeting prices for batteries, and why it’s good news for the climate.

 

FUN OPINIONS

NYT’s Coy Says Carbon Capture May Struggle to Succeed – In his column in the New York Times, Peter Coy writes while carbon capture is intriguing and important, it won’t save us from climate change. Carbon Capture is a savior in the long run but a snare in the short run. The right combination is to spend money researching and developing the technology for when it’s eventually necessary but put the bulk of our effort into cutting emissions drastically.

 

FROG BLOG

Blog Targets Conservative Group on Climate Agenda – In an opinion blog in The Hill,  Richard Richels, Henry Jacoby, Ben Santer, Gary Yoh write don’t let the Heritage Foundation’s denialism ‘Mandate’ drive our climate agenda. The Heritage prescription for dealing with the threat of global warming today is to back out of the Paris climate agreement for the second time, impair the scientific community’s ability to collect and interpret key climate data sets, relax existing greenhouse gas regulations and gut energy provisions of the IRA. The map presented in the Heritage Foundation’s Mandate is of a road to ruin. Continuing down its suggested path will assuredly result in Heritage’s “god of nature” setting us straight, followed by frantic attempts to change course.

Biden EV Policy Pummeling US Auto Dealers – In an opinion blog in The Hill, former Trump EPA official Mandy Gunasekara writes US auto dealers are being slammed by President Biden’s push to promote electric vehicles. From inflation to gas-stove bans, it’s clear President Biden and his top officials are living in an alternate reality. Perhaps no issue proves this point more than their unrealistic mandate for electric-vehicles, a multibillion-dollar effort to force Americans into cars they simply don’t want and can’t afford. While the manufactures roll in the billions of taxpayer dollars aimed at sweetening the otherwise unrealistic transition, American auto-dealers, and by extension their customers, are left holding the proverbial bag. Most Americans cannot afford or simply don’t want EVs. “Range anxiety” is very real, as it still takes hours to recharge batteries, versus minutes to fill up gas tanks.

 

FUN FACTS

China and EVs:  EV sales in China are running far ahead of what regulations require. This is contrary to many in the West saying everyone there is being forced to buy EVs.

 

IN THE NEWS

Hydro Relicensing Reform Bill Advances in House – Reform of the hydropower licensing and relicensing process continues to advance in Congress. The House Energy Committee approved HR 4045, the Hydropower Clean Energy Future Act, championed by Chair McMorris Rodgers. Three Democrats (Reps. Kuster, Peters and Schrier) joined with all the Republicans to advance the bill to the floor. Meanwhile, the Senate Energy Committee is scheduled to mark up their bipartisan reform bill next week, S.1521, sponsored by Sens. Daines and Cantwell. The National Hydropower Assn (NHA) cheered the progress, noting that almost half of the non-federal hydropower fleet faces expensive relicensing in the next several years, with 17,000 MWs of flexible, carbon-free generation at risk of premature retirement.

Congress Heads to Dubai, COP28 – On Saturday, Members of Congress headed to COP 28 in Dubai for a series of events. Reps. Kelly Armstrong and John Curtis lead the delegation that aimed to carry to the world stage at COP 28 the message about building on America’s energy leadership, to demonstrate a path to a cleaner, more secure world, and more prosperous and resilient communities. At the same time, Democrats and Republicans were pointing out where they have made bipartisan inroads on climate action, for instance in promoting nuclear energy to lower emissions. The number of Republicans attending COP28 was also, for the first time, eclipsed the number of Democrats traveling with the E&C delegation. From the Senate, a bipartisan delegation of senators, led by Senate FR Chair Ben Cardin, arrived in Dubai on Friday to attend the second week of the two-week climate conference. The delegation includes Sens. Chris Coons, D-Del., Ed Markey, D-Mass., Sheldon Whitehouse, D-R.I., Lisa Murkowski, R-Alaska and Tom Carper, D-Del.

NM Governor Announces Water Plan at Chamber Event – At an even hosted by the US Chamber of Commerce at the 2023 UN Climate Change Conference (COP28), Gov. Michelle Lujan Grisham announced a first-of-its-kind strategic water supply to increase drought resilience and advance clean energy production and storage. The strategic water supply will support the nation’s transition to renewable energy by providing resources for water-intensive processes around creating green hydrogen, storing energy produced by wind and solar, and manufacturing electric vehicles, microchips, solar panels, and wind turbines, for example. Global warming and aridification are exacerbating water shortages throughout the Southwestern U.S. Consequently, reservoirs and groundwater supplies are critically low and not recharging to ensure future water security. In Albuquerque, the Rio Grande went dry for the first time in four decades in August 2022. Such events illustrate how current water supplies are not matched for future demand, where climate models predict up to a 25% reduction in available water across the state. Through a $500 million investment, New Mexico will purchase treated brackish and treated produced water to build the strategic water supply. In early 2024, the New Mexico Environment Department will issue guidance and seek proposals from companies interested in pursuing a contract. This contracting model, used in other industries like healthcare for manufacturing vaccines, is known as an advanced market commitment. Advanced market commitments reduce the risk of private sector investment and spur first movers to build otherwise costly infrastructure. Companies that are awarded an advanced market commitment contract can secure private capital to build and operate water treatment facilities with the assurance the State of New Mexico will purchase the water.

Stanton Energy Storage Site Opens in LA Area – A big new Southern California Edison battery storage facility opened in Stanton yesterday. The new project is one of the state’s largest energy storage systems, bringing 275.2 megawatts to Orange County — enough storage to power 65,000 homes.

It’s built by power producers Wellhead and W Power in partnership with energy storage company Energy Vault. They’re touting the project’s proximity to a natural gas plant, which they say, “further optimizes power generation and storage capabilities in the region.” The Stanton facility relies on 15,540 lithium-ion batteries, similar to the ones that power cell phones and electric vehicles. Each is roughly a quarter the size of a Tesla car battery, with the 265-pound modules stacked on top of each other more than a dozen feet high and housed inside shipping container-style metal boxes.

Kerry May Continue Climate Role – U.S. special presidential climate envoy John Kerry signaled his desire to continue in his role after this year’s U.N. climate talks conclude. Speaking to POLITICO’s Power Play podcast with Anne McElvoy, Kerry said, “As long as this is a crisis, I will be organizing and speaking and active in dealing with this challenge.” Pressed on how long he would serve as special envoy, he replied: “Maybe in one role or another, I have no idea. I intend to be a citizen until my last breath.”

Coons, Tillis Introduce Concrete Innovation Bill – Sens. Chris Coons (D-DE) and Tom Tillis (R-NC) introduced the Concrete and Asphalt Innovation Act of 2023 that would create a low-emissions concrete and asphalt research, development, and demonstration (RD&D) program - with a focus on alternative fuels and carbon capture, utilization and storage, leverage Manufacturing USA institutes to support development and testing of low-emissions concrete and asphalt, provide performance-based, low-emissions transportation materials grants through the Federal Highway Administration, authorize the Secretary of the Department of Transportation to make advance purchase commitments for low-emissions concrete and asphalt, and form an interagency task force for concrete and asphalt innovation. A one-pager and section-by-section can be found here. While the bill has room for improvement PCA welcomed its introduction and will continue to work with our members alongside other concrete and asphalt stakeholders to make improvements to the legislation. 

 

ON THE SCHEDULE THIS WEEK

COP 28 Dubai -- COP 28 week two is under way until December 12^th in Dubai.

Forum Looks at Permitting, Power Plant Development – The R Street Institute holds a virtual discussion this morning at 10:00 a.m. on reducing regulatory costs and timelines for power plant development. The event features a conversation with leading practitioners and scholars on completing reforms to achieve efficient generator interconnection practices. Speakers include Vistra’s Arnie Quinn and Karen Onaran, President and CEO of the Electricity Consumers Resource Council.

Powerhouse CEO Panel Discussions Electricity Supply Challenges – Today at Noon, the US Energy Assn holds another media briefing on a new era of energy crisis is that is unfolding in the nation's electricity supply. Experts for the discussion feature NRECA CEO Jim Matheson, ERCOT CEO Pablo Vegas, Cal ISO CEO Elliot Mainzer, President & CEO, California ISO, Tri-State G&T Association CEO Duane Highley and CPS Energy CEO Rudy Garza. Reporters asking questions of the powerhouse panel include the WSJ’s Jen Hiller, AP’s Matt Daly and Ken Silverstien of Forbes.

CSIS Reviews 2023 – Today at 1:00 p.m., CSIS Energy Security and Climate Change Program hosts a live recording of its  podcast, Energy 360. As COP28 wraps up, Kevin Book, ClearView Energy Partners, Senior Adviser (Non-resident), Energy Security and Climate Change Program, CSIS, and Liam Denning, Opinion Columnist, Bloomberg, will assess what COP28 developments have staying power and look ahead to energy and climate issues to watch next year.

Forum Tackles Climate issues in Philippines – The Henry L. Stimson Center and the U.S.-Philippines Society hold a virtual discussion tomorrow at 9:30 a.m. on COP28 and climate challenges and opportunities for the Philippines.

Senate Approps Looks at Delayed Disaster Funding – The Senate Appropriations Transportation, Housing and Urban Development, and Related Agencies Subcommittee holds a hearing tomorrow at 10:00 a.m. on delayed disaster recovery funding and its impacts.

USEA Holds Forum on Lithium – The US Energy Assn will hold a briefing tomorrow at 11:00 a.m. US and North American lithium. The event will provide speakers to discuss new technologies and production of lithium essential for the many new energy applications (batteries for cars, renewable energy used by electric utilities and industrial applications).

House Resources Panel Looks at Dam Breach Issues – The House Natural Resources Water, Wildlife and Fisheries Subcommittee holds a hearing tomorrow at 2:00 p.m. examining the Biden Administration's policy to potentially eliminate the Pacific Northwest's clean energy production through new breaching of dams.

Senate Energy Looks at Critical Mineral Legislation – The Senate Energy and Natural Resources Public Lands, Forests and Mining Subcommittee holds a hearing tomorrow at 2:30 p.m. on S. 1281 (118), the "Mining Regulatory Clarity Act of 2023"; and S. 1742 (118), the "Clean Energy Minerals Reform Act of 2023."

Forum Highlights Women Leadership – POLITICO will host key leaders in Washington tomorrow at 5:30 p.m. to discuss how we can shape policy to improve opportunities for women. Two esteemed corporate powerhouses Duke Energy’s Pepper Natonski and Dori Kreiger, Executive Director of the CTIA Wireless Foundation, will discuss their impact as leaders.

Forum Looks at Climate Urgency – The George Washington University Elliott School of International Affairs holds its 2023 Walter Roberts Annual Lecture tomorrow at 6:00 p.m. on  climate diplomacy and communicating the urgency. Iceland Ambassador to the United States Bergdis Ellertsdottir speaks.

Forum Looks at OPEC in Clean Energy World – On Wednesday at Noon, New America holds a virtual discussion on the future of OPEC in a clean energy world. The panel featuring Amy Jaffe-Myers explores the state of play for OPEC countries in this transformative era, examining the challenges and opportunities of transitioning to clean energy and the resulting shifts in geopolitics.

ACORE Annual Meeting Set – The American Council on Renewable Energy (ACORE) is hosting its Annual Member Meeting on Wednesday from 1:00 p.m. to 2:00 p.m.  Members will receive an update on ACORE's activities in 2023 and explore our key focus areas in 2024.

House Transpo Hears from WRDA Stakeholders – On Wednesday at 2:00 p.m., the House Transportation and Infrastructure Water Resources and Environment Subcommittee holds a hearing on proposals for a Water Resources Development Act of 2024 from stakeholder priorities.

Forum Looks at National Oil Companies, Methane – The Center for Strategic and International Studies (CSIS) hosts an event on Thursday at 3:00 p.m. examining the role of national oil companies (NOCs) in reducing global methane emissions. It will provide an opportunity to discuss announcements at COP28, including the Oil and Gas Decarbonization Charter, as well as a look ahead to post-COP implementation.

Forum Looks at Energy Efficiency – The Hill holds a discussion on Thursday at 8:30 a.m. focused on enhancing energy efficiency and how that technology is cutting carbon emissions. Speakers include Rep Tim Walberg, Sen Ed Markey, DOE’s Carla Frisch, Paula Glover of the Alliance to Save Energy, Rewiring America’s Jamal Lewis, Director and ACEEE’s Steve Nadel.

Forum Looks at Climate, Gender Impacts – The Henry L. Stimson Center holds a discussion on Thursday at 10:00 a.m. examining the climate crisis and gender: regional, national and local approaches. The event will feature an international panel of experts will discuss the outcomes of the conference as they pertain to the climate-gender nexus. The discussion will explore the actions needed to strengthen approaches and address the gendered dimensions and impact of climate insecurity.

Forum Looks at China–Europe Climate Tech  Dependance – The Center for Strategic and International Studies holds a virtual discussion Thursday at 10:00 a.m.  on managing European dependencies on China for climate technologies. The Trustee Chair for Chinese Business and Economics Senior Fellow Ilaria Mazzocco will present her latest publication evaluating European diversification and derisking policies on China. Following a presentation of the publication's findings, there will be a roundtable discussion about the challenges and opportunities associated with clean energy technology supply chains and green industrial policy in Europe. Panelists include Agatha Kratz of the Rhodium Group, Loyle Campbell of the German Council on Foreign Relations, and Alicia García-Herrero of Bruegel.

USEA Looks at Supply Chain Cyber Threats – The US Energy Assn holds a virtual discussion Thursday at 10:00 a.m., on emerging Cyber Threats to industrial control systems and supply chains. Part of its the Advancing Modern Power Through Utility Partnership (AmpUp) program with USAID, the event will feature Camilo Gómez, Global Cybersecurity Strategist at Yokogawa (an industry leader in Automation and Test and Measurement solutions). This webinar is the first in a ten-part series aimed at giving USAID partner-country utilities, policymakers, and regulators a clear panorama of the relevance of cybersecurity within the electricity sector, including how to mitigate supply chain risks and monitor third-party vendor access. Gómez will talk about how to recognize indicators of threat and identify intelligence sources and potential vulnerabilities. Practical strategies to prepare for, anticipate, and respond to threats both organizationally and technically, including how to recognize cybersecurity capability in the supply chain will be discussed.

DOE’s Satyapel, FCHEA’s Wolak Headline H2 Forum – On Thursday  at 12:30 p.m., USEA is hosting a briefing with Dr. Sunita Satyapel, Director of DOE’s Hydrogen Fuel Cell Technologies Office brief USEA on their program looking at hydrogen hubs and the expansion of Hydrogen. Dr. Sunyapel will be joined by Frank Wolak of Fuel Cell and Hydrogen Energy Association (FCHEA), an industry association for hydrogen energy and fuel cell technologies. This is the first of a series of 2024 USEA remote one-hour briefings on hydrogen with government and private sector experts.

IN THE FUTURE

State of American Energy Event Set – The American Petroleum Institute holds its annual State of American Energy Forum on Wednesday January 10, 2024 at Capital Turnaround.  API’s Mike Sommers will discuss the state of the industry and the event will also feature panels with experts and Congressional Leaders.

State of American Business Set – The US Chamber of Commerce holds its annual State of American Business Address on Thursday, January 11^th at 11:00 a.m. Chamber President/CEO Suzanne P. Clark will celebrate the power of American businesses discussing the innovation and impact of America’s free enterprise system that enables businesses to serve customers, solve problems, and strengthen society.

USEA Holds State of Energy – USEA holds its 20^th Annual State of the Energy Industry Forum from Noon to 4:00 p.m. on January 23, 2024 at the National Press Club.  The forum brings together CEOs from Washington’s leading energy trade associations where they outline their policy objectives and priorities for the upcoming year.