Energy Update: Week of December 9th

Energy Update - December 09, 2024

Friends,

First, some exciting news today on/from the Bracewell Team: 1) my colleagues Scott Segal, Dee Martin and Tim Urban have been named The Hill’s Top Lobbyists; 2) This Energy Update has been named the American Energy Society’s Independent Blog of the Year.  It is part of AES’s year-end awards that include Writer of the Year Rosanna Xia of the LA Times, Energy Book of the Year to our friend Ernest Scheyder for his book, The War Below, on critical minerals, Company of the Year, Southern Company, Academic Expert of the Year, Michael Webber of UT and Dave Roberts’ Volts as its Top Podcast; and 3) I had a great visit with SIRIUS XM P.O.T.U.S.’s Julie Mason on Friday to talk energy in Trump II and what we may see in Biden's closing days.

Congress continues to try to get to the finish line this week. Speaker Johnson aims to put the National Defense Authorization Act on the floor, despite a $25 billion gap between the House and Senate.  As well, some military and national security experts are urging Congressional leaders to include permitting reform in the NDAA because of its implications for national security. The House also will vote this week on the Liberty in Laundry bill would bar DOE from implementing or enforcing new efficiency rules on washing machines if they are not "cost-effective or technologically feasible" and do not result in "significant conservation of energy." There is also a House Oversight hearing tomorrow morning on the Postal Service which may feature some discussion of a recent Reuters story on whether the new Administration is considering canceling the USPS's contracts to electrify its delivery fleet.

We are also watching closely for the DOE’s LNG study which Asst Sect Brad Crabtree last week told a gas forum and Congressional hearing that it would be released in “mid-December.” Many of us think that may be Friday the 13th! Either way, there will be big LNG news in the next 10 days or so,  Definitely, keep your eyes peeled. It is a busy week for oil markets with:

Tomorrow, AGA holds a virtual presser with NiSource CEO Lloyd Yates, and incoming AGA Chair to discuss the natgas industry and insights on the increasingly vital role natural gas will play in the year ahead. Email Emily Carlin (ECarlin@aga.org) or Adam Kay (akay@aga.org) for details.

Then on Thursday, SAFE, Americans for a Clean Energy Grid (ACEG) and Conservatives Energy Network (CEN), hold a webinar on permitting reform and its nexus with America’s national and economic security.

President Trump is talking tariffs, including in yesterday’s Meet The Press interview.  My colleagues Paul Nathanson and Josh Zive are following these Issues closely and can be a good resource. 

Finally, we have the first 12-team NCAA Football Playoff set.  Oregon, after its Big Ten Championship win gets the top seed, but may run in Ohio State in Round Two.  Should be interesting to watch.  More importantly, my favorite game of the year is Saturday when Army and Navy meet here in former FedEx field in Landover, MD. President Trump will attend the game, just like he did in 2016.

Call with questions. Best,

Frank Maisano

(202) 828-5864

C. (202) 997-5932                                                                                                       

FRANKLY SPOKEN

“I hope we will look at it [IRA] very carefully and go about it in a surgical manner as opposed to just with a sledgehammer.”

Georgia Rep. Buddy Carter commenting to POLITICO’s Josh Seigel saying he supports an emerging two-step push that would give the party more time to be “deliberate” about taxes and the fate of President Biden’s climate law.

ON THE PODCAST

Resources Radio Talks SAF – In this version of the CSIS podcast Energy 360⁰, hosts Joseph `Majkut and Quill Robinson discuss the role of energy and climate in the U.S.-China relationship and the outlook for the Trump administration with Ilaria Mazzocco and Frank Fannon. China is the largest emitter of greenhouse gases and the leading global renewable energy manufacturer. The United States is the second largest contributor to greenhouse gas emissions and the world’s top oil and gas producer.

FUN OPINIONS

Ethanol SAF Key Driver of Jobs, Rural Development – In an op-ed in the Dakota Scout, South Dakota farmer Paul Casper writes that sustainable aviation fuel facilities producing it from ethanol are a much needed boon to the rural economy.  Facilities like a new plant in Lake Preston, SD are worthwhile infrastructure investments that will generate $23 million in annual federal tax revenue and $116 million in annual economic impact. “This will be a huge boon to rural economies – empowering workers, residents, and farmers across the Lake Preston region by generating new income and supporting new and existing business ventures. Moreover, these SAF manufacturing facilities like Lake Preston are self-sustaining, and will run on its own energy supply from new wind turbines.”

Auto Uncertainty Puts MI Economy at Risk – Michigan Advance Columnist Rick Haglund writes Michigan’s flagship auto industry is in a precarious position as companies scale back electric vehicle production targets and President-elect Trump promises to roll back EV incentives and enact tariffs, among other economic headwinds. It all presents a big worry for a state in which 20% of its workers are employed in the auto and “mobility” sectors. And the industry’s turmoil portends to be more intractable than the cyclical downturns we’ve come to expect in the notoriously capricious auto business.

FROG BLOG

LNG Pause Folly Policy – In a blog post, API’s Mark Green writes demand for U.S. LNG shows the folly of President Biden’s permitting pause.  Global demand for U.S. LNG remains strong, bolstering the argument for ending the LNG permitting pause – misguided and without merit – which some have characterized as “political and partisan.”  Amid record U.S. LNG exports, Americans have benefited from some of the lowest residential natural gas prices in the world. American natural gas helps allies, benefits U.S. trade and has helped grow the domestic economy – even as American families enjoyed some of the lowest natural gas prices in the world. U.S. LNG can help other nations lower their emissions and advance climate goals.

Energy Key To Economic Success – In an opinion piece in RealClearEnergy, American Consumer Institute analyst Kristen Walker writes energy is the lifeblood of the economy and consumers deserve to have it be abundant, reliable, and affordable. With energy demand on the rise, this can only be accomplished through pragmatic and sensible solutions that maximize energy output and focus on a true all-of-the-above strategy. The disastrous Biden policies that have shackled our supplies and crippled economic prosperity must be eradicated. A course correction come January will be most welcome.

FUN FACTS

Power Demand Cranking Up:  In 2022, utilities expected electricity demand to grow by 23 GW over the next 5 years.  In 2023, they upped that to 39 GW (which was at the time shocking). This year, they are projecting 128 GW of new demand.  

Source: EIA

IN THE NEWS

ACP Highlights Storage – A new analysis from the American Clean Power Association says the addition of 5GW of energy storage in Texas over the last year helped contribute to $750 million in cost reductions, avoided consumer conservation notices and enabled the power grid to better navigate extreme weather events. Key findings include:  

  • Energy demand in Texas has skyrocketed over the past two years.   
  • Large capacity additions of energy storage (5 GW) over the course of one year in Electric Reliability Council of Texas (ERCOT) region helped outpace rising energy demand. 
  • Energy storage capacity additions contributed to $750 million in cost reductions, creating savings for consumers.  
  • Energy storage capacity additions helped prevent conservation appeals during Summer 2024 and helped ERCOT navigate prolonged moments of stress that would traditionally threaten the grid with power outages. 

Texas and independent system operator ERCOT serve as "a prime example of how rapidly our energy systems must evolve in the United States to be able to consistently deliver reliable and affordable energy to consumers," the report argued.

Interior Asks for Comments on Weak 5Y Drilling Plan – Better late than never? Interior is asking the public to comment on the draft environmental impact assessment of its five-year offshore drilling plan that only (and reluctantly) calls for three offshore drilling leases through 2029, the lowest number in the program’s history, with none of them occurring outside the Gulf of Mexico. BOEM will hold three virtual public meetings on January 14th, 15th and 16th and there will be a 45-day comment period. API’s Ryan Meyers said when the plan was initially released that demand for affordable, reliable energy is only growing, yet “this administration has used every tool at its disposal to restrict access to vast energy resources in federal waters. In issuing a five-year program with the fewest lease sales in history, the administration is limiting access in a region responsible for generating among the lowest carbon-intensive barrels in the world, putting American consumers at greater risk of relying on foreign sources for our future energy needs.” 

Final 48C Clean Energy Manufacturing Rules Revised – Last week, the IRS released its final guidance for the Section 48 Energy Credit, which includes a 30% Investment Tax Credit for hydrogen energy storage property. The final rulemaking accepted several FCHEA comments requests, including removal of an energy only use requirement for hydrogen storage equipment and expanding the list of supported equipment under the credit to include limited hydrogen pipelines and liquefaction equipment. This is a huge victory for hydrogen and FCHEA our members who have worked diligently on this issue for many months.

Grid Report Shows Challenges From AI – Grid Strategies anticipates U.S. electricity demand will increase five times faster than previously estimated over the next five years, with the main drivers being the rise of data centers and manufacturing in a new report, Strategic Industries Surging: Driving U.S. Power Demand.  The report projects that the U.S. electricity load in 2029 will hit 947 gigawatts, representing 15% growth in demand in just five years. Potential load growth has increased five times over the last two years. Strategic industries like semiconductor chip manufacturing, artificial intelligence, and battery manufacturing are driving this growth.  The report added that large-scale transmission investments are needed to meet demand but policy changes like permitting reform would be required.

Coalition Urges Congress to Support Critical Mineral Price Actions – A coalition of trade groups, think tanks and companies are urging Congressional leaders in a letter to pass federal price support for the critical minerals industry to help U.S. firms compete against China’s unfair trade practices.

“While existing grants and loans help with capital costs, they are insufficient to meet our supply chain challenges,” reads the letter led by Bipartisan Policy Center Action. “For a fully integrated U.S. mineral supply chain to prosper and support manufacturing and industrial demands, additional measures are needed to ensure these projects can sell at prices that justify investment.”

The signatories include the National Mining Association, the Breakthrough Institute and NEMA, as well as companies like Sila and 6K, don’t endorse any specific legislation. To counter this alarming market dominance and unlock substantial private investment, the U.S. needs federal price support for critical minerals and materials as a key part of its strategy to secure supply chains. As outlined in the Bipartisan Policy Center’s recent report, Resilient Resource Reserve: A Plan to Catalyze the American Critical Mineral Processing Industry, federal price support can provide the certainty needed to build and scale domestic projects. Different critical minerals and materials require tailored tools to address unique market challenges, making flexible financial authority crucial.  

Reports Looks at SRM Challenges – The Energy Futures Finance Forum (EF3) of the EFI Foundation (EFIF)new report, Making Small Modular Reactors Bankable Investments. In this report, EFI offers actionable policy recommendations to overcome key barriers hindering the formation of investment-grade orderbooks for small modular reactors (SMRs) in the United States. While the first-of-a-kind builds for any new SMR design will involve higher upfront costs, economies of scale in subsequent builds have the potential to drive down costs, reduce uncertainties, and increase bankability. The report highlights the key challenges currently facing SMR commercialization and provides targeted policy recommendations to address these challenges and improve the financial viability of SMRs.

ON THE SCHEDULE THIS WEEK

AGU Meeting Set for this Week – The American Geophysical Union holds its AGU24 annual meeting at the Washington Convention Center in DC this week with the theme What's Next for Science.

IEA Webinars Look at Energy Outlook Issues – The IEA holds a series of webinars this week following the recent release of World Energy Outlook 2024.  Authors will present key findings across three webinars with the Age of Electricity today, its Fuels Outlook tomorrow and a forum on People-centered Energy Transitions on Wednesday.  Each will kick off at 8:00 a.m. ET.

CSIS Forum to Look at AI – The CSIS Wadhwani AI Center for the International AI Policy holds an Outlook for 2025 conference today. This full-day event will convene leading policymakers, industry experts, and thought leaders to explore the latest international efforts in AI governance. Panel discussions will focus on global governance initiatives such as the G7’s Hiroshima AI Process, private sector adoption of AI policy frameworks, infrastructure advancements to meet AI power demands, and what to expect AI policy to look like under the Trump Administration.

Virgin’s Branson Headlines RMI Forum – Tomorrow at Noon, Virgin Corp founder Sir Richard Branson and RMI Managers Taylor Krause and Ian Welch-Phillips hold a December RMI webinar on new climate leaders. The discussion will explore the importance of activating the next generation of climate leaders and how these leaders are partnering to advance clean energy solutions around the world.

WM Forum Looks at Hydrogen in 2025 – Wood Mackenzie holds at upcoming Hydrogen Webinar on tomorrow at noon focused on what to look for in 2025. The WM Hydrogen team will discuss key themes to look for in 2025 and answer questions about global policies and decarb challenges.

Forum Looks at Latin American Energy Challenges – The Wilson Center’s Latin America program will host a forum tomorrow at 3:00 p.mm. looking at a Latin America agenda for a new White House and Congress. US neighbors are potential partners on a range of issues, from strengthening supply chains and mining minerals for new technologies to defending democracy and supporting Taiwan.

NiSource CEO to Present on Year Ahead for Natural Gas Industry – The American Gas Association will hold a virtual press conference tomorrow at 3:00 p.m. where Lloyd Yates, Incoming Chair of the AGA’s Board of Directors and NiSource President and CEO, will present his vision for our industry and insights on the increasingly vital role natural gas will play in the year ahead.

Axios to Discuss Sustainable Transportation – Axios holds an evening event tomorrow at 5:30 p.m. in Washington, D.C., convening voices across business and transit for conversations looking at the latest advancements in sustainable transportation. The event will look at strides and challenges for various industries working to integrate and scale cleaner transportation for corporations, supply chains and customers. Axios business reporter Nathan Bomey will host one-on-one conversations with House Transportation and Infrastructure Committee members Rick Crawford and Hillary Scholten.

CSIS to look at Power Demand – On Wednesday, the CSIS Energy Security and Climate Change program holds a conference charting a path for American energy strategy in a new era of electric demand growth. The conference will feature contributions from experts across the sector. Panel discussions will cover the implications of electricity-intensive strategic industries and economic growth, policy tools for unlocking increased investment and innovation, the strategic value of high-voltage transmission infrastructure, and the trajectory of AI-sourced demand growth. Our friends Rich Powell, Rob Gramlich and Jason Grumet are among the key speakers. NERC’s Jim Robb offer the keynote speech.

USEA Holds December Presser on VPPs – The US Energy Association holds a virtual press briefing on Wednesday at 11:00 a.m. looking at issues surrounding DER and VPP. Speakers addressing this topic include Pacific Northwest National Laboratory Jason Fuller, former Nextel co-founder Morgan O’Brien, Holy Cross Energy CEO Bryan Hannegan, Bloom Energy Ravi Prasher, Brian Keane of SmartPower and EPRI’s Irene Danti Lopez.

Conservative Court Watcher Hosts Case Discussion – Following the SCOTUS arguments tomorrow, the Federalist Society for Law and Public Policy Studies holds a virtual discussion on the Seven County Infrastructure Coalition v. Eagle County Colorado case. Speakers include Prof. Andrew Mergen, who assisted respondents in the court of appeals, and Prof. Paul Salamanca, who wrote an amicus brief in support of petitioners.

Forum Looks at Renewable Project – The Urban Institute, the Communication Workers of America and the Interstate Renewable Energy Council hold a virtual event on Wednesday at 1:00 p.m. to launch the Clean IT Project. The event will explore how industry-recognized tech training can equip workers with the skills they need for IT careers in the renewable energy sector.

EESI Holds Tennessee River Forum – The Environmental and Energy Study Institute (EESI) holds a briefing on Wednesday at 2:00 p.m. about strategies to decrease pollution and increase resilience along the Tennessee River, which winds through Tennessee, Alabama, Mississippi, and Kentucky. This briefing will explore ongoing efforts to address the impacts of water pollution on environmental justice communities situated along the Tennessee. It will also highlight the importance of effective enforcement of local, state, and federal clean water laws and regulations. Panelists will discuss the role of federal policy-making in preventing and mitigating pollution in the region, as well as opportunities to support biodiversity and overall river health.

Forum Looks at Critical Minerals – The Women's Foreign Policy Group and the Embassy of Tanzania hold a discussion on Thursday at 9:00 a.m. on critical minerals and focus on economic security and the U.S.-Africa relationship. The event will highlight the role that critical minerals play in influencing both economic and national security and building global supply chains. Ambassador of Tanzania to the US Elsie Sia Kanza will give opening remarks.

SAFE Makes National Security Case for Permitting – On Thursday at 11:00 a.m., SAFE and its panelists from the Energy Security Leadership Council (ESLC), Americans for a Clean Energy Grid (ACEG), and Conservatives Energy Network (CEN), hold a webinar discussion on why permitting reform is foundational to the Trump administration’s agenda, its nexus with America’s national and economic security, and how Energy Permitting Reform Act of 2024 (EPRA) will help address the long-broken federal permitting process. This event will include a dialogue with military leaders and policy experts exploring the importance of permitting reform on American nuclear power, artificial intelligence, advanced manufacturing, and the nation's economic and national security. a webinar discussion on why permitting reform is foundational to the Trump administration’s agenda, its nexus with America’s national and economic security, and how EPRA will help address the long-broken federal permitting process. Speakers include Christina Hayes of Americans for a Clean Energy Grid, Admiral Michelle J. Howard (Ret.), 38th Vice Chief of Naval Operations, John Szoka of the Conservative Energy Network and former Carnival CEO Adam Goldstein.  SAFE’s Avery Ash moderates.

USEA Holds Advanced Energy Forum, Holiday Reception – On Thursday at Noon, the US Energy Assn holds its Advanced Energy Technology Showcase in the Ronald Reagan Building and International Trade Center to look at the future of energy. The event will feature groundbreaking technologies from the Department of Energy and industry leaders. There will also be discussions on how both public and private investments are fueling innovation for the energy transition. After the event, USEA will hold its annual holiday reception.

ACORE Forum Looks at Transmission – On Thursday at 2:00 p.m., ACORE holds a virtual discussion on historic Midwestern transmission portfolio issues. The event features Midwest grid experts to discuss the benefits of MISO’s second portfolio, how MISO succeeded in reaching consensus on such a historic build, and key takeaways other regions should consider as they seek to comply with the FERC's regional transmission planning and cost allocation rule, Order 1920.

Forum Looks at Africa Coastal Climate Resilience – The Henry Stimson Center holds a virtual discussion on Friday at 8:00 a.m. on prioritizing coastal climate resilience in Madagascar. The event will look at how the Climate and Ocean Risk Vulnerability Initiative (CORVI) is driving efforts to secure climate adaptation financing and build resilience for the region’s future.

Wilson Forum Looks at US-Canada Energy Issues – On Friday at 10:00 a.m., the Wilson Center’s Mexico and Canada Institutes will launch the final report of the North American Leadership Summit on Energy and Innovation Working Group. The report launch will feature a discussion of the report's key findings, informed by dialogue with our colleagues and North American energy experts throughout this year's workshop series. This report provides recommendations for renewed trilateral cooperation, and policy opportunities for the North American partners in the wake of major elections in Mexico and the US. Confirmed speakers include Michael Catanzaro, the Hon. Lisa Raitt and Fernando Zendejas Reyes.

Forum Look at Conflicts, Rare Earth Minerals – On Friday at Noon, the Institute for Policy Studies holds a virtual discussion on rare earth elements and war.  Rare earth elements are a key component in renewable energy infrastructure. But the powerful magnets that require REE are also increasingly a major part of armaments such as bombs, bombers, submarines, and drones. The event will look at if military applications divert much needed resources away from the transition away from fossil fuels and military supply chains impact on communities around REE mining sites.

IN THE FUTURE

Forum Focused on Tools to Decarb Cement, Concrete – RMI and partners hold a webinar on Thursday January 9th 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 holds its annual State of American Business forum on Wednesday January 15th

Presidential Inauguration Set – The 60th Presidential Inauguration will be held on Monday January 20th  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 21st annual State of the Energy Industry Forum on January 23rd from 10:30 a.m. to 5:00 p.m. at the National Press Club.