Energy Update: Week of December 16th

Friends,

As Congress heads to the finish line this week, we expect a full array of action in the energy space. Lawmakers in both parties are finalizing language for a year-end spending package that would avoid a government shutdown on Dec. 20 and fund the government through March. It's expected to be released this afternoon.

Let’s start with what we know: It is almost certain that permitting reform is off the table as Congress scratches together its final CR. While House Resources Chair Bruce Westerman and retiring Senate Energy Chair Joe Manchin still are trying to salvage modest reforms, it seems that timing and logistics will make it near impossible. Meanwhile, there is a letter from 37 groups including American Clean Power, US Chamber of Commerce, Business Council for Sustainable Energy, FCHEA, ACORE, C2ES, ClearPath, National Mining, the Clean Energy Buyers Assn, NAM, SEIA and the Progressive Policy Institute called Congress to act now.  That is a varied group! Can send you the letter if you want to see it.

In a final hoorah, the Senate Budget Committee holds one more climate hearing with Sen. Whitehouse as chair on Wednesday. One would expect the committee’s agenda next year to revert to, oh I don’t know, working on the Federal Budget. Also, tomorrow, the DC Circuit hears a Republican AGs’ challenge (probably not a great one, BTW) to the Biden Admin’s change to the National Air Quality standards for Particulate Matter (which it reduced 25% from 12 ppm to 9 ppm). The 9 ppm limit would throw most of the country out compliance on background noise alone so expect the Trump Admin to eventually take this Rule back to the drawing board. Finally, FERC holds its December Open Meeting on Thursday.

We also know that the IRS will issue its 45V hydrogen tax credit guidance later in the week, mostly likely on Friday. Let’s be clear on the three items that will create demand for a hydrogen marketplace: 1) The DOE’s Loan Program office has/continues to invest in innovative technologies to produce and develop hydrogen, 2) DOE’s $7B Hydrogen Hubs are regional stakeholder, private-public partnership that can/will implement the infrastructure and market (which has companies and advocates, as well as Govs. Greg Abbott and Gavin Newsom on the same side and 3) a FLEXIBLE IRS 45V tax credit will boost the marketplace and create demand in the expanding hydrogen industry. We have a full array of experts on the topic and will be ready to discuss. 

We are expecting the DOE to release its LNG study as soon as tomorrow, which make this a big LNG week so stay tuned.  They may be additional materials on LNG as well. Just remember, this “review’ was political from the start of the pause back in February when WH Climate official Ali Zaidi announced it (not DOE) as a means to prevent an enviro group protest at DOE in the beginning of a campaign year.

Finally, others have reported the EPA will grant California a waiver approving its planned ban on gasoline cars (despite consumer pushback), but is all but guaranteed to be rejected by the Trump administration. Meanwhile, the Supreme Court on Friday said it will consider whether oil and biofuel groups to challenge EPA’s issuance of a waiver to California for its clean car program.

Our friend and BCSE head Lisa Jacobson headlines a EESI briefing tomorrow about the recently released DOE EERE’s 2024 Investment Snapshot report. The 2024 EERE Investment Snapshot summarizes the benefits of investments in clean, efficient, and reliable energy technologies over the last decade.

Special Congrats to our long-time friend and (many times, editor/proofreader) Mary O’Driscoll who is retiring from the FERC Comms office after 17 years.  Of course, we worked with Mary as a reporter before that and wish her the best!!

No regular updates over the next two weeks but Special Updates as events warrant.  Call with questions. Best,

Frank Maisano

(202) 828-5864

C. (202) 997-5932                                                                                                                  

FRANKLY SPOKEN

 “Any person or company investing ONE BILLION DOLLARS, OR MORE, in the United States of America, will receive fully expedited approvals and permits, including, but in no way limited to, all Environmental approvals. GET READY TO ROCK!!!”

President Trump on Truth Social.

 “I think they’ve gone a bridge or two too far. We’re going to keep talking.”

Retiring Senate Environment Chair Tom Carper in objecting to House Republican demands to retool the National Environmental Policy Act as part of permit reform.

ON THE PODCAST

USEA Podcast: New Study On Grid Demand Challenges – For its 100^th episode, USEA’s Power Sector podcast features Grid Strategies John Wilson answered questions by journalist Herman K. Trabish about findings in his just-released paper, now the talk of the energy world, on the magnitude and drivers of the surging U.S. demand for electricity.

Diringer Talks COP 29 Outcomes – In this week’s Columbia Energy Exchange, host Bill Loveless talks with Elliot Diringer about the COP process and what the outcome of this year’s summit means for the global energy transition. A former senior policy advisor to Special Presidential Envoy for Climate John Kerry, Elliot is a global fellow at the Center on Global Energy Policy at Columbia University SIPA, directing the Center’s International Dialogue on Climate and Trade.

FUN OPINIONS

Harber: The Wright Person for the Energy Job – In an op-ed in the Denver Post, energy expert, media personality and former DOE consultant Aaron Harber suggests that Chris Wright brings to the DOE a depth of expertise rarely seen in Cabinet appointments. With a degree in Mechanical Engineering from the Massachusetts Institute of Technology and graduate work in Electrical Engineering at both MIT and UC Berkeley, he’s the kind of technical mind the DOE needs. However, given that “President Harris” is not making the pick, Chris Wright ultimately will be seen by even people on the Left as one of President Trump’s best and most reasonable selections over the next four years. His expertise, pragmatism, and genuine concern for both the environment and global energy equity make him a rare figure in today’s political landscape. Over time, even his critics may come to appreciate what he brings to the table.

FROG BLOG

Permit Reform is National Security Imperative LNG Pause Folly Policy – In an opinion blog in RealClearEnergy, Admiral Michelle Howard, 38^th Vice Chief of Naval Operations and LS Power CEO Paul Segal write the US is grappling with the dual challenges of escalating energy demand and mounting global competition, particularly from China. Despite the critical role of our nation’s energy infrastructure, our permitting process can prolong vital projects by several years—or even decades. SAFE’s Center for Grid Security underscores that overhauling the procedures for approving and constructing energy infrastructure is not just a matter of efficiency—it is a matter of national urgency in the face of escalating global power competition.

FUN FACTS

Geothermal has Huge Upside Potential:  Technology advances, especially drilling techniques borrowed from the US fracking industry, are making it possible to tap hotter resources deeper underground. By 2050, the IEA said, geothermal could go from providing less than 1% of global energy to more than 15%, and could be especially useful for Asian countries trying to reduce their reliance on coal, as well as for powering data centers.

IN THE NEWS

Biofuels Groups Urge Improvements in 45Z Credits – In several letters, biofuels groups are urging House Republicans to make tweaks to IRA tax credits to a request for information from six GOP lawmakers on the House Ways and Means Committee. The lawmakers called on stakeholders last month to offer input on the extended biodiesel tax credit, the sustainable aviation fuel credit and the new clean fuel production credit that begins in 2025 and laid out concerns with the current implementation of the provisions.  Gevo and the Business Council for Sustainable Energy were on board.

Gevo Purchase of North Dakota Ethanol/CCS Plant Approved – Co-op Equity Holders in a Richardson, ND Ethanol Plant have overwhelmingly approved Gevo’s planned acquisition of the plant and its carbon capture and sequestration assets. This acquisition of Red Trail Energy will accelerate Gevo’s mission to transform renewable energy into net-zero SAF/transportation fuels and chemicals while reducing the carbon footprint. Gevo CEO, Dr. Patrick Gruber said:

“With this investment, Gevo will be set on a path to becoming self-sustaining and profitable as a company in advance of our Net-Zero 1 project coming online. This acquisition also enables an ideal location for a ‘Net-Zero North’ plant to produce sustainable aviation fuel. It also mitigates risk around carbon sequestration for our Net-Zero 1 plant site in South Dakota.”

Gevo is acquiring the Red Trail Energy ethanol production assets and the CCS assets for $210 million. The transaction is expected to close by the first quarter of 2025. 

Gevo, LG Chem Extend Joint Development Agreement to Commercialize Ethanol-to-Olefins –  Speaking of Gevo, they joined LG Chem to extend a joint development agreement to assess existing assets for deploying Gevo’s Ethanol-to-Olefins (“ETO”) technology while accelerating commercialization activities, considering project scale and end-product markets. Gevo’s patented ETO technology can target carbon-neutral or carbon-negative drop-in replacements for traditional petroleum-based building blocks. These are core olefins, that can be used for renewable fuels and chemicals, including sustainable aviation fuel and bio-propylene. ETO technology is just one of multiple patented technologies that Gevo is bringing to bear on the challenges of developing cost-effective bio-based renewable fuels and chemicals. Because it can replace fossil-based products as a renewable raw material for various plastic products, bio-propylene is expected to play a pivotal role in the rapid growth of the bioplastic market and circular economy. Once commercialization is achieved, bio-propylene could be used as a drop-in replacement for use in a range of products from auto parts to flooring to diapers to replace petroleum products with bio-based materials with a low or negative carbon footprint.

Energy Vault Partnership Supports 2GW of Power for Data Centers – Energy Vault and RackScale Data Centers today announced a strategic partnership to accelerate delivery of 2GW of power for RSDC’s data centers. The partnership will focus on deployment of the Energy Vault B-Nest™, a proprietary hyperscale energy storage solution comprised of a multi-story battery system, for data center sites.  The B-Nest™ provides 8X the energy density versus standard battery solutions, enabling space-constrained sites without firm power to accelerate deployment via interruptible utility power contracts while ensuring 24/7 availability. Trent D’Ambrosio, Chief Executive Officer, RackScale Data Centers:

"Our partnership with Energy Vault is a powerful catalyst in our mission to develop cutting-edge data centers,” said. “The B-Nest system's high energy density and advanced safety design are game-changers for our operations, enabling us to accelerate firm grid power interconnections and onsite generation to meet the needs of our data center sites. We look forward to working closely with Energy Vault to achieve our shared vision of a sustainable energy future."

B-Nest™ Product Launch: Today’s announcement marks the launch of Energy Vault’s latest long-duration energy storage system solution. The B-Nest, introduced alongside Energy Vault’s B-VAULT™ suite of fully-integrated battery energy storage systems designed for reliability, flexibility, and availability, introduces a multi-story fixed frame structure to house BESS. This design enables data center developers to overcome space constraints typically associated with data center sites and thermal generation retirements in order to leverage those sites’ large interconnect capacity. The proprietary technology behind B-Nest stems from the IP developed for Energy Vault’s gravity-based energy storage systems, and will incorporate structures similar to those used in G-VAULT™ designs.

DOE Selects GLE for Uranium Enrichment Program – The U.S. Department of Energy (DOE) has selected Global Laser Enrichment (GLE) as an awardee under its Low-Enriched Uranium (LEU) Enrichment Acquisition. This funding initiative seeks to build domestic uranium enrichment capacity, promote market and technology diversity, and provide a reliable supply of commercial nuclear fuel to support energy security free from Russian influence. The award provides a minimum contract value of $2 million and a maximum value for all awardees totaling $3.4 billion. The final award value will depend on competitive task orders to be subsequently issued by DOE. GLE CEO Stephen Long said:

“This award represents another milestone for GLE’s planned deployment of the Paducah Laser Enrichment Facility and demonstrates DOE’s continued confidence in GLE’s technology and potential to deploy a commercial enrichment plant. GLE is the only awardee deploying previously licensed next-generation laser enrichment technology and the only entity capable of providing a fully domestic, single site solution to supply critically needed new U.S. capacity for uranium, conversion, and enrichment utilizing the DOE’s legacy depleted uranium tails. This project would support both new enrichment capacity and the cleanup of DOE legacy activities.”

GLE is currently working towards a commercialization decision and maintains a deployment target of no later than 2030. On November 27, 2024, GLE announced the acquisition of 665 acres in Paducah for the proposed facility. GLE plans to submit an environmental report to the Nuclear Regulatory Commission in December 2024 and a safety evaluation report in the summer of 2025 for site licensing.

ON THE SCHEDULE THIS WEEK

ACORE Holds Member Meeting – The American Council on Renewable Energy (ACORE) is hosting its Annual Member Meeting this afternoon at 1:00 p.m. Members will receive an update summarizing ACORE's activities in 2024 and a preview of what is ahead in 2025.

Forum Looks at Climate Finance – The Atlantic Council holds a virtual discussion today at 1:00 p.m. on innovative climate finance in 2025.  The event will evaluate guarantee mechanisms and focus on emerging markets and developing economies. This session will consider the future of using guarantees and how they may be deployed without an EMDE guarantee, the impacts that COP29 outcomes and new US leadership may have on climate finance flows, and updates on our Emerging Market Climate Investment Compact project.

EESI Looks at DOE Energy Efficiency Snapshot Report – The Environmental and Energy Study Institute (EESI) holds a briefing tomorrow at 10:00 a.m. about the recently released DOE’s Office of Energy Efficiency and Renewable Energy (EERE) 2024 Investment Snapshot report. The 2024 EERE Investment Snapshot summarizes the benefits of investments in clean, efficient, and reliable energy technologies over the last decade. While each field in EERE’s portfolio has seen remarkable progress, the report focuses on EERE’s impact and outcomes as a whole and shows how continued investment in EERE can continue to yield measurable and demonstrable benefits for the American people. Speakers include DOE Asst sect for EERE Alejandro Moreno, BCSE head Lisa Jacobson and ASE head Paula Glover.

WaPo Hosts Rounds for Discussion on Trump Second Term – Tomorrow at 12:15 p.m., Sen. Mike Rounds joins The Washington Post’s Leigh Ann Caldwell to discuss President-elect Donald Trump’s sweeping second-term agenda, the incoming administration’s cabinet picks and his priorities for a Republican-controlled Congress.

Senate Budget Holds Final Climate Hearing – In final climate hearing of the session, the Senate Budget Committee holds another hearing on Wednesday at 10:00 a.m. focused on climate-driven insurance issues.

AAAS Looks at PFAS – On Wednesday at 2:00 p.m., the American Association for the Advancement of Science holds a virtual discussion on land-applied biosolids and PFAS exposure.

FERC Open Meeting Set – FERC holds its December Open Meeting on Thursday.

WaPo Talks AI, China with Schmidt – Former Google CEO Eric Schmidt is the co-author of the new book, “Genesis,” which explores the opportunities and challenges of the artificial intelligence revolution. On Thursday at 12:30 p.m., Schmidt joins The Post’s Bina Venkataraman to discuss how AI could shape the future and how America stays ahead.

IN THE FUTURE

Forum Focused on Tools to Decarb Cement, Concrete – RMI and partners hold a webinar on Thursday January 9^th to look at RISE PA Industrial Decarbonization Grant application best practices, with a focus on the cement and concrete sector. RISE PA is a Pennsylvania statewide industrial decarbonization grant program funded through the US Environmental Protection Agency’s Climate Pollution Reduction Grants under the Inflation Reduction Act. The webinar covers key steps in the grant process, such as strategies for creating a strong application and meeting requirements, tips for incorporating community engagement, and insights to make your project stand out.

API Holds State of Energy – The American Petroleum Institute's State of American Energy will be held on Tuesday January 14, 2025 at The CAPITAL TURNAROUND.

Chamber Preps for State of American Business – The US Chamber will hold its annual State of American Business forum on Wednesday January 15^th

Presidential Inauguration Set – The 60^th Presidential Inauguration will be held on Monday January 20^th  in Washington, D.C. The ceremony will be held on the west front of the U.S. Capitol.

USEA to Host State of Energy Industry – The US Energy Assn holds its 21^st annual State of the Energy Industry Forum on January 23^rd from 10:30 a.m. to 5:00 p.m. at the National Press Club.