Energy Update: Week of May 29th

Friends,

Welcome to summer. I hope everyone had a few days to enjoy a deep breath even as White House and Congressional negotiators had their nose to the grindstone.  I have an abbreviated update this week to address the latest action on the debt limit and permitting.

All that work seems to have paid off as President Biden and Speaker Kevin McCarthy reached an agreement in principle over the holiday weekend to lift the debt limit for two years while cutting and capping some government spending over the same period, a breakthrough that aims to avoid a US default. Congressional passage of the plan is planned before next Monday, June 5^th, when the Treasury is projected to exhaust its ability to pay its obligations, is not assured.

As always, we’re tracking any movement on permitting as part of the debt-ceiling and its implications. It has a permitting section in it which I offer details on below. Votes are expected as early as Wednesday in the House.

Other than the debt limit, the other major item is the Sunday meeting in Vienna of the Organization of the Petroleum Exporting Countries and its allies. There have been conflicting messages swirling ahead of the meeting about whether OPEC+ would consider any additional crude output cuts.

One Senate Energy hearing on Thursday taking a closer look at last week’s NERC report on summer reliability challenges with the electric grid and a timely Punchbowl forum on Wednesday featuring API ‘s Mike Sommers, ACP’s Jason Grumet, ASE’s Paula Glover and building trades union leader Sean McGarvey looking at permitting with the weekend’s deal taking shape.  And if you miss Grumet Wednesday, on Thursday ACCF hosts Grumet in a special web forum and permitting WILL be on the list of items discussed.

We will be back in full next week Monday. Stanley Cup and NBA finals both start later this week. 

                                                                                                                                              

FRANKLY SPOKEN

“Increased, rapid deployment of wind, solar and batteries have made a positive impact. However, generator retirements continue to increase the risks associated with extreme summer temperatures, which factors into potential supply shortages in the western two-thirds of North America if summer temperatures spike.” 

Mark Olson, NERC’s manager of Reliability Assessments, following release of its 2023 Summer reliability assessment.

 

ON THE PODCAST

Energy Central Talks Natgas Future – In this week’s Power Perspectives podcast on Energy Central, host Jason Price and producer Matt Chester welcome Suzanne Ogle, the President and CEO of Southern Gas Association (SGA) to help explain ideas that may run counter to some of the common narratives.  Ogles suggests there are opportunities that gas presents to proliferate decarbonized energy, and the outlook for the industry in the years to come.

 

IN THE NEWS

Debt Limit Details – After weeks of stop-and-start negotiations, Biden and House Speaker Kevin McCarthy struck a deal “in principle” over the weekend to extend the debt limit until 2025, while capping nondefense discretionary spending at current levels, followed by a 1% increase in 2025.

Timing – Rules today, then Suspension votes Tues where they will whip the debt limit vote.  Final vote on FRA bill on Wednesday evening after 72 hours has elapsed.  Watch out for key Rules Committee Members Tom Massie, Chip Roy and Ralph Norman today.

Text for Legislation – The Link to bill text: https://docs.house.gov/billsthisweek/20230529/BILLS-118hrPIH-fiscalresponsibility.pdf

Permitting Summary – Summary from section by section on the permit provisions:

TITLE III—PERMITTING REFORM

Sec. 321. BUILDER Act. This section includes statutory reforms to the National Environmental Policy Act, including project threshold, interagency coordination and review deadlines to prevent project delay, limits on what qualifies as a major federal action, and limits to prevent agencies from missing statutory deadlines. This section provides the first significant reforms to NEPA since 1982.

Statutory Clarity and Section 102 of NEPA. Amends NEPA to clarify and narrow agency considerations to “reasonably foreseeable environmental impacts of the proposed agency action,” “reasonably foreseeable adverse environmental effects,” and “a reasonable range of alternatives to the proposed action that are technically and economically feasible and meet the purpose and need of the proposed action.”

Interagency Coordination and Timely Reviews. Codifies key elements of the One Federal Decision Framework, including development by the lead agency of a joint schedule, procedures to elevate delays or disputes, and, to the extent practicable, preparation of a single environmental document. The legislation also sets reasonable page limits for environmental documents and reasonable time limits of one year for environmental assessments and

2 years for environmental impact statements. The bill provides a right of action to project applicants if statutory deadlines are not met.

NEPA Thresholds and Streamlining. Includes threshold considerations for agencies assessing whether NEPA applies to a proposed activity. The bill also includes provisions facilitating agencies adopting categorical exclusions of other agencies through a streamlined process.

Project Sponsor Preparation. Permits a project sponsor to assist agencies in conducting environmental reviews to help speed up the process and to resolve issues without taking control or authority away from the lead agency.

Major Federal Action. Amends NEPA and clarifies that a major federal action is limited to those which are “subject to Federal control and responsibility.” It establishes a threshold consideration that is independent of the significance of impacts that may follow. It includes examples of actions that are not “major Federal actions.”

Scientific Accuracy and Modern Technology. Includes provisions requiring agencies to use reliable existing data sources and clarifies NEPA does not require undertaking new scientific and technical research to inform analyses.

E-NEPA: Directs the Council on Environmental Quality to conduct a study on applying modern digital technologies to provide efficiencies in the permitting process; requiring the consideration of a government-wide permitting portal to streamline communications and data sharing between agencies and applicants.

Sec. 322 Interregional Transfer Capability Determination Study. This section would authorize North American Electric Reliability Corporation to carry out, in consultation with regional operators, a study to examine total current transfer capabilities and provide recommendations to strengthen reliability and meet and maintain transfer capability between neighboring transmission regions.

Sec. 323 Permitting Streamlining for Energy Storage. This section adds energy storage to this list of covered projects eligible for streamlining under the FAST Act.

Sec. 324 Expediting Completion of the Mountain Valley Pipeline. This section would expedite the completion of the Mountain Valley Pipeline.

Enviros Don’t Like It But Won’t Oppose – Environmental groups widely condemned overall permitting piece, especially the MVP inclusion, but were divided on what that means for the bill as a whole. Sierra Club Executive Director Ben Jealous said in a statement that Congress should “reject this deal and swiftly pass a clean bill.”  But that won’t ever happen. The League of Conservation Voters and NRDC indicated they will not oppose the bill.

Other Items in the Deal – The deal recaptures billions in unspent COVID-19 funds, imposes tougher work requirements on food stamps and Temporary Assistance to Needy Families benefits and cuts some of the IRA’s $80 billion for new IRS personnel.

 

ON THE SCHEDULE THIS WEEK

USEA Media Brief Looks at Utilities, AI – The US Energy Association will hold another virtual press briefing today at 11:00 a.m. to examine the coming impact of AI on electric utility operations.  At the briefing, a panel of energy reporters will question a panel of experts on the power and the challenges of AI for electric utilities. The experts include Brown University’s John Savage, EPRI’s Jeremy Renshaw, Marc Spieler of Nvidia and Dan Robertson of Landis + Gyr.  The reporters include AP’s Matt Daly, Matt Chester of Energy Central, Jennifer Hiller of the Wall Street Journal. Peter Behr of E&E News and Forbes Columnist Ken Silverstein.

ITIF to release RD&D Report – Today at Noon, the Information Technology & Innovation Foundation holds a forum to release of the Center for Clean Energy Innovation’s annual report assessing the federal energy RD&D budget and an expert panel discussion on how the funding aligns with key priorities. Our friend Dan Byers of the US Chamber’s Global Energy institute is among the panelists with DOE’s Science Undersecretary Geri Richmond

Forum Targets Innovation – The Information Technology & Innovation Foundation holds a forum today at 12:00 p.m. on further energizing innovation.  The event will assess the Federal Energy RD&D Budget for FY24 and Beyond and includes the release of the Center for Clean Energy Innovation’s annual report assessing the federal energy RD&D budget and an expert panel discussion on how the funding aligns with key priorities.

WaPo Live Hosts Climate Forum – Today at 3:00 p.m., Washington Post Live hosts conversations with Ryan Panchadsaram, technical adviser at Kleiner Perkins, Mekala Krishnan, partner at McKinsey Global Institute, and Tensie Whelan, director of the Center for Sustainable Business at New York University, about the role of the private sector in fighting global warming and whether a new climate industrial revolution could be on the horizon.

Punchbowl, API Host Permitting Forum – Punchbowl News will host a conversation on permitting reform on Wednesday at 9:00 a.m. The event, moderated by Punchbowl News Founder Jake Sherman, will feature industry leaders including Mike Sommers, CEO of American Petroleum Institute, Paula Glover, president of the Alliance to Save Energy, Jason Grumet, CEO of American Clean Power and Sean McGarvey, president of the North America’s Building Trades Unions.

Forum Looks at Morocco, Climate Change – The Middle East Institute and the North Africa Policy Initiative (NAPI) hold a forum on Wednesday at Noon to look at the impacts of climate change on Morocco and what they can do about it. Experts will consider policy lessons and best practices to address the negative effects of climate change on the Moroccan environment, economy, and social wellbeing.

Carbon Pipeline Hearing Set for Iowa – PHMSA provided notice of a public meeting it will hold on CO2 pipeline safety from Wednesday and Thursday in Des Moines, Iowa. The meeting will “serve as an opportunity for pipeline stakeholders to help inform pipeline safety-related rulemaking decisions and share information surrounding CO2 pipeline safety. Key stakeholders include the public, states, tribal governments, other federal agencies, industry, and international regulators and/or organizations.”

Senate Energy Looks at Reliability Challenges – The Senate Energy Committee holds a hearing on Thursday at 10:00 a.m. to address the reliability and resiliency of electric services in the U.S. considering recent reliability assessments and alerts.  Last week, NERC released a concerning report about the summer reliability and the Committee will investigate.

ACCF Hosts, Grumet, WaPo Editor – On Thursday, the American Council for Capital Formation (ACCF) holds two special webinars.  At 10:00 a.m., they host a conversation with Jonathan Capehart, a Pulitzer-winning Associate Editor for The Washington Post.  Then at Noon, they host a conversation with Jason Grumet, CEO of the American Clean Power Association (ACP). Of course, expect the permitting issues to be front and center.

Forum to Focus on Hydrogen – EESI and the Environmental Defense Fund (EDF) hold a briefing on Thursday at 2:00 p.m. looking at the science of hydrogen and its potential as a source of clean energy. Panelists will describe the current state of research on hydrogen, including new technologies to detect hydrogen leaks, and discuss the most efficient and effective use cases for hydrogen power, such as powering industrial applications and heavy-duty transport.

 

IN THE FUTURE

Geothermal Conference Set – The Geothermal Rising Conference is set for next Monday June 5^th and Tuesday June 6^th at the Willard Hotel in Washington.  The two-day event seeks to raise the profile of all geothermal technologies and applications to DC audiences and to share policy solutions that will empower the geothermal industry as it seeks to play an impactful role in the clean energy transition and decarbonizing the economy. Former FERC Chairman Neil Chatterjee is the Keynoter while our friends Nick Loris of C3, API’s Uni Blake and ClearPath’s Jeremy Harrell speak on panels.

Forum to Highlight Climate Policy Papers – The Peterson Institute for International Economics holds a two-day event on Monday June 5^th and Tuesday June 6^th on the macroeconomic implications of climate action. This conference is organized to shed light on this new field of study, including the key mechanisms and methodologies for empirical assessment, and to draw policy conclusions. The conference will feature presentation of papers, policy panels, and discussion.

Forum Looks at EU Climate Policy – The Global CCS Institute will be hosting an EU Green Week partner event on Monday June 5^th at 9:00 a.m. to assess Europe’s place in the climate policy sphere. The event features a closer look at Europe’s ambitious climate and CCS policies, and what steps can be taken to enhance CCS deployment initiatives.

Forum to Focus on EVs, Equity – The Clean Energy States Alliance holds a forum on Tuesday June 6^th at 1:00 p.m. on electric vehicles and equity. Panelists will discuss potential pathways for electric vehicle deployment to lower harmful emissions, reduce transportation expenses, and advancing equity as well as increase energy resilience in underserved and historically marginalized communities.

Finance Forum Set for NYC – The ACORE Finance Forum returns to New York City on June 7-8^th. This year, leaders from across the renewable transaction landscape will assess risk mitigation amidst uncertainties regarding IRA implementation, inflation, permitting challenges and transmission constraints. With a great deal of capital ready to flow into the renewable sector, don’t miss this opportunity to learn how experts are navigating the possibilities and growth-driven challenges.

EESI Looks at Forestry – The Environmental and Energy Study Institute (EESI) ad U.S. Nature4Climate hold a briefing on Wednesday June 7^th at 2:00 p.m. to Look at opportunities to advance climate-friendly forestry in this year’s Farm Bill. During this briefing, panelists will explain forestry-related programs in the Farm Bill and cover essential forestry topics, including wildfire management, innovative wood products, carbon markets, and urban forestry. Sen Angus King leads off the event.

WaPo Looks at South Korea Climate Goals, Investment – On Thursday, June 8 at 6:00 a.m. ET / 7:00 p.m. KST, the Washington Post Live’s global “This is Climate” series holds an event in Seoul about South Korea’s climate goals and investments in a more sustainable economy. Guests will include Sang-Hyup Kim, co-chair of the presidential commission on carbon neutrality and green growth, Hyun Cho, South Korea’s former ambassador to the United Nations, and Sun-Jin Yun, environmental studies professor at Seoul National University.

Press Club Book Event Set to Roll Out Climate Wealth, Competitiveness Book – The National Press Club holds a Book Event on Thursday June 8^th at 9:30 a.m. featuring a discussion of Bruce Piasecki’s new book, Wealth and Climate Competitiveness: The New Narrative on Business and Society is the center piece of this two hour discussion. 

Forum to Look at Community Wind – On Thursday June 8^th at 1:00 p.m., Lawrence Berkeley National Laboratory holds a forum on revisiting community wind through the lens of community solar. Speakers will compare and contrast the community wind and community solar markets in the U.S. and ask why community wind faded in the U.S. while community solar has thrived, as well as what lessons might community wind learn from community solar.

Look at Community Engagement on Energy Issues – The Clean Energy States Alliance holds an event on Thursday June 8^th at 3:00 p.m. on six community engagement models from Energy Trust of Oregon. This presentation and accompanying case study will highlight innovative models of collaboration between state energy agencies and community-based organizations in order to better meet their shared goals.

Wilson Forum Looks at Carbon Pricing – The Wilson Center holds a forum on Friday June 9^th at 9:00 a.m. looking at carbon pricing and the energy transition. Carbon pricing has faced multiple and significant hurdles to adoption. But momentum is building. In recent years, Europe and Canada have established robust pricing schemes. While the U.S. lags on carbon pricing, policies adopted by its trade partners will likely impact investment.

US Trade Rep Headline POLITICO London Forum – POLITICO holds its inaugural Global Tech Day, taking place on Thursday June 15^th in London. US Trade Rep Katherine Tai will keynote an event that will focus on the latest in global tech and the ramifications of our world's newest innovations on international politics.