THE PATH OF LEASE RESISTANCE: The Senate Energy Committee is pushing through with hikes for federal oil and gas leasing fees as part of Democrats' reconciliation package, though at lower rates than those in the House Natural Resources version, Pro's Josh Siegel reports. The Senate committee is slated to release the text of its portions of the bill this week and Josh snagged a copy for your delectation. The Senate version would increase the minimum rate for royalties from onshore production from 12.5 percent to 16.75 percent. That's less than in the House version, which would have gone up to 18.75 percent. But offshore royalties remained consistent with the House, with rates raised to no less than 14 percent, compared to 12.5 percent currently. They would be the first raises to the royalty and rent fees in over 100 years. The Senate text also keeps a provision charging royalties on all natural gas a company produces, including gas that is consumed or lost by venting and flaring, in a bid to rein in methane emissions. Senate Energy Chair Joe Manchin (D-W.Va.) has called for reforming the federal leasing program, casting it as a fairness issue for tax payers, despite pleas from industry to nix "harmful" reforms to the program proposed by the House. But the oil and gas industry still got some concessions. The Senate Energy text does not include a ban on new leases off the Atlantic, Pacific and East Gulf coasts that was included in the House package, nor does it include new annual pipeline fees. "It's an improvement compared to the House Natural Resources language, but there are question marks on what it is trying to achieve strategically," an oil and gas industry source told Josh. "At a time of near record inflation, the legislation surprisingly includes new fees on domestic oil and gas production that will serve to benefit foreign producers to the detriment of American consumers and workers." Read more from Josh here. NDAA GOES TO BIDEN: The Senate voted 88-11 to pass its defense policy bill Wednesday, sending it up to President Joe Biden's desk. The package authorizes $768 billion for national defense programs, including $27.8 billion for the Department of Energy's nuclear weapons programs. Lawmakers managed to include a number of environmental and energy provisions into the package, including a push from Sens. Tim Kaine (D-Va.), Mark Warner (D-Va.), Chris Van Hollen (D-Md.) and Ben Cardin (D-Md.) to shore up protections for military bases and their surrounding environments from stormwater, and a push by Rep. Sean Casten (D-Ill.) to get 10 percent of military installations to reach net zero emissions by 2035. Pro's Connor O'Brien has more on the bill. MALONEY WANTS GAO CHECKS ON JUSTICE40: House Oversight Chair Carolyn Maloney (D-N.Y.) wants the Government Accountability Office to provide periodic public reports on the Biden administration's initiative to allocate 40 percent of environmental benefits to vulnerable communities in order to ensure the pledge is executed effectively and fairly. "Specifically, I request that GAO review the Justice40 framework and agencies' implementation by individual agencies, with the goal of assessing the extent to which the initiative is succeeding in targeting federal investments to disadvantaged communities," Maloney writes in a letter to Comptroller General Gene Dodaro. Maloney wants the updates released periodically through fiscal year 2026 as well as regular briefings with the committee. The administration is still working out the details for how it will execute its campaign promises for environmental justice, holding frequent meetings with activists and other stakeholders to ensure the commitment isn't lost in red tape. But some vulnerable communities are already saying accessing federal benefits to help right environmental wrongs is proving a Gordian knot of applications and authorizations that they don't have the personnel to untie. PROGRESSIVES PUSH FOR CAPTURE THRESHOLD: The Congressional Progressive Caucus is fighting back calls from carbon capture backers to get rid of a minimum capture requirement for power plants to touch tax benefits under Democrats' reconciliation package. The current clean energy tax provisions require power plants to capture at least 75 percent of carbon emissions in order to benefit from the full host of 45Q tax benefits in a bid to avoid using the credit to fund projects that don't effectively mitigate emissions. The CPC released a statement Wednesday saying getting rid of the threshold would be a "handout to the biggest polluters" and "an insult to basic tax fairness." But carbon capture backers retort having such a high threshold would discourage deployment and investment, particularly for natural gas plants. "We don't have time to sit on or shelve some of our most effective ways to reduce emissions and to do it relatively quickly," Ryan Fitzpatrick, director of Third Way's Climate and Energy Program, told ME. Third Way joined a cohort of advocacy groups in a letter last week to Senate Finance Chair Ron Wyden (D-Ore.) and Manchin urging the removal of the 75 percent threshold. The House already offered a concession to CCUS backers in getting rid of a similar threshold for non-generating industrial facilities, but backers of the minimum argue power generation has more readily available non-carbon emitting alternatives than sectors such as cement manufacturing. Senate tax writers are still negotiating the provision, a Finance Committee aide told ME. | 
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