| | | | | |  | | By Matthew Choi | With help from Kelsey Tamborrino, Ximena Bustillo, Alex Guillén and Ben Lefebvre. Editor's Note: Morning Energy is a free version of POLITICO Pro Energy's morning newsletter, which is delivered to our subscribers each morning at 6 a.m. The POLITICO Pro platform combines the news you need with tools you can use to take action on the day's biggest stories. Act on the news with POLITICO Pro. | | | — The White House lost two high-profile environmental staffers just as it is facing deadlines on its environmental justice work. The departures aren't sitting well with activists. — The Biden administration unveiled a spate of clean energy initiatives as Democrats' reconciliation agenda stalls on the Hill. — The latest consumer price index release dealt another blow to Democrats' legislative agenda, with centrist Sen. Joe Manchin calling the inflation data "very, very troubling." WELCOME TO THURSDAY! I'm your host, Matthew Choi. Congrats to ME Trivia Platinum Player Ed Chen of NRDC for knowing he was the first Asian American president of the WHCA. Ed is one of the most faithful trivia players and often accompanies his answers with interesting anecdotes. He retires this week to work on a book on climate change. We'll miss your answers, Ed! For today's trivia, finish the lyrics: "Genovia, the land _______." Send your tips and trivia answers to mchoi@politico.com. Find me on Twitter @matthewchoi2018. Check out the POLITICO Energy podcast — all the energy and environmental politics and policy news you need to start your day, in just five minutes. Listen and subscribe for free at politico.com/energy-podcast. On today's episode: Biden's offshore wind boost. | | | | | | | | STEP INSIDE THE WEST WING: What's really happening in West Wing offices? Find out who's up, who's down, and who really has the president's ear in our West Wing Playbook newsletter, the insider's guide to the Biden White House and Cabinet. For buzzy nuggets and details that you won't find anywhere else, subscribe today. | | | | | | | | OMINOUS DEPARTURES FOR EJ: Two of the White House's point people on environmental justice left in rapid succession in recent days, causing concern among activists as the administration comes up on important deadlines for its justice initiatives, Pro's Zack Colman reports. Cecilia Martinez and David Kieve both left the Council on Environmental Quality just as the White House is due to release a scorecard to track the administration's EJ goals and guidance for agencies to implement EJ policy. Advocates, including members on the White House Environmental Justice Advisory Council, fear CEQ is too short staffed to carry out Biden's justice mission. Several advisory council members told Zack that much of the work now rests on Corey Solow, now the last remaining White House official primarily focused on environmental justice. Three council members wrote to White House chief of staff Ron Klain asking how he plans to execute President Joe Biden's objectives following the departures. Advocates have already been raising concerns about the lack of clarity on how the White House was tackling the issue. Many of the key terms in Biden's stated objectives remain murky, including his Justice40 initiative designed to allocate 40 percent of federal environmental benefits to vulnerable communities. What exactly counts as a benefit or vulnerable community remains to be decided. "My concern is that either each agency will do its own thing or they might not do anything — they might do the same old thing that they've always done," said Ana Baptista, an associate director of the Tishman Environment and Design Center at The New School in New York City and an advisory council member. The White House retorts that environmental justice issues are front and center on the minds of all staffers and it will soon announce new hires. Read more from Zack. | | | THE CLEAN ENERGY CHARGE: The Biden administration unveiled a suite of clean energy initiatives across numerous agencies Wednesday, including holding its first auction for offshore wind leases in the waters off of blue states New York and New Jersey and a new push for a faster transmission buildout using funds from the bipartisan infrastructure package. Agencies will also work together to better coordinate on deploying clean energy on public lands with a memorandum of understanding between departments of the Interior, Agriculture, Defense, Energy and the Environmental Protection Agency. The multi-departmental push comes as Democrats' reconciliation package remains stalled on the Hill. Climate advocates and lawmakers insist executive action won't be enough to reach the administration's clean energy and emission reduction goals, and that the $555 billion in climate funding is an indispensable piece of the pie. Still, clean energy industry groups heralded Wednesday's announcements as important steps. The offshore wind lease sales in the New York Bight, reported by Pro's Kelsey Tamborrino on Tuesday, would be a major boost for the U.S.' fledgling offshore wind industry, industry backers say. The Energy Department also released a report outlining areas for growth and job potential with offshore wind. Kelsey has more for Pros. THE HIGH PRICE TO PAY: The consumer price index reached a four-decade high with 7 percent increase last December, POLITICO's Victoria Guida reports, dealing a serious blow to Biden in wooing support for his legislative agenda. Sen. Joe Manchin has cited inflation as a major concern about the Build Back Better package, and though he wouldn't comment at length on the new figures Wednesday, he told reporters it was "concerning," especially for West Virginians. "It's hitting us very hard," he said. Some backers of the package say it could alleviate inflation concerns by bolstering job growth. Biden said in a statement the report "shows a meaningful reduction in headline inflation over last month, with gas prices and food prices falling." Biden added inflation was impacting all economies recovering from the pandemic, but "we still have more work to do." LEAD ZEPPELIN: After years of complaining by environmental groups, EPA has taken a step toward regulating lead in aircraft fuel, the biggest remaining source of airborne lead in the U.S. Leaded fuel was phased out of most vehicles decades ago, but it remains in a type of aviation fuel known as "avgas" used by some piston-engine aircraft. EPA on Wednesday told green groups that had petitioned for action that it does intend to develop an endangerment finding for leaded aviation fuel. EPA plans to issue a proposal this year and finalize it next year, and actual regulations could take additional time. — The National Academy of Sciences in 2021 issued a report calling for multi-agency action on aircraft lead emissions, noting that EPA action could be a game-changer. DOE DISHES ON DISHWASHERS: The Energy Department finalized a rule this week to undo the Trump administration's standards for dishwashers and washers and dryers. The Trump administration had established new short-cycle product classes for residential dishwashers, residential clothes washers, and consumer clothes dryers that would not be subject to water or energy conservation standards, meaning they could consume unlimited amounts of energy and water. The Biden DOE's final rule withdraws those short-cycle classes and reverts back to the previous classes and standards from 2013. | | | | BECOME A GLOBAL INSIDER: The world is more connected than ever. It has never been more essential to identify, unpack and analyze important news, trends and decisions shaping our future — and we've got you covered! Every Monday, Wednesday and Friday, Global Insider author Ryan Heath navigates the global news maze and connects you to power players and events changing our world. Don't miss out on this influential global community. Subscribe now. | | | | | | | | NEW YEAR, NEW RFS PUSHBACK: The ethanol industry was on the defensive Wednesday after Reuters reported the Biden administration is considering lowering the 2022 ethanol blending mandate below the proposed 15 billion gallons as part of its final rule. ME readers will recall the administration proposed retroactively reducing 2020 biofuel blending requirements and setting the 2021 volume near the actual demand level, but called for ramping the levels up for 2022 in what was seen as an attempt by the administration to walk the fine line between farming and refining interests. But Reuters reported Wednesday that the administration is seeing strong backlash from the refining lobby and unions over the 2022 proposal, which argue that the U.S. ethanol industry can't support the target. Unions and refiner groups repeatedly pushed back against the proposed 2022 levels during a virtual public hearing last week, arguing the proposal was too high and would negate the benefits of the 2020 and 2021 proposals. Asked about the report during Wednesday's House Agriculture hearing on EVs, Renewable Fuels Association President and CEO Geoff Cooper said the group "would be greatly concerned" if EPA is backtracking on the 2022 proposal. "We're going to try and get to the bottom of those rumors and will be absolutely insisting that EPA and this administration follow through on their commitment to restore that 15-billion-gallon commitment for 2022 and beyond," he said. Grain of salt: Asked about the report, one person in the refining industry told Kelsey there's "some nervousness" given the extensive union pushback, as well as concerns over gas prices and jobs, but the person cautioned there haven't been any definitive signals one way or another on whether the administration will act. In the meantime, union leaders continue to press their case. There was a call earlier this week during which several union leaders from the Philadelphia area voiced their concerns about the proposal to EPA and White House officials, a person with knowledge of the call told Kelsey. EPA later confirmed there were two calls — one with national unions and a second call with unions and companies — but the agency did not provide any readouts or confirm any details. "EPA remains committed to the growth of biofuels in America," EPA spokesperson Nick Conger said. "We look forward to reviewing the robust comments that we receive from all stakeholders before finalizing our rulemaking later this year." Comments on the proposal are due Feb. 4. STRESSING OVER CLIMATE TESTING: The American Petroleum Institute has problems with the Federal Reserve's idea of having banks conduct stress tests to determine their potential exposures to climate change, trade association Chief Executive Mike Sommers told reporters Wednesday. The idea got backing from Federal Reserve chair Jerome Powell in June. But oil companies, which currently already have a hard time attracting investors, are pushing back. Sommers, speaking after the API's annual policy update, said the Fed "should stick to their mandate of tackling inflation while ensuring that unemployment remains low. We want to make sure the Federal Reserve focuses on that rather than taking capital out of the market at a time when the oil and gas sector needs more investment." Still, member companies doing business anywhere outside the U.S. border might need to get used to the idea: central banks in Europe, Hong Kong, Singapore and Australia are already taking a close look. API BACKS EPA METHANE PROPOSALS: Sommers also told Pro's Josh Siegel and Ben Lefebvre the group now backs EPA's latest proposals on regulating methane emissions. API had held off on opining on EPA's plans, though it had previously backed federal regulations for wells built before 2015. The group still does not back a methane mechanism under consideration in Democrats' reconciliation bill, Sommers said, even with $775 million allocated to help oil and gas companies comply. | | | ON HOUSE ENERGY'S RADAR: The House Energy and Commerce Committee's oversight subpanel will be meeting next Thursday for a hearing on the impacts of cryptocurrency on energy and the environment. Cryptocurrency can use enough electricity to rival entire towns, and the committee will look into "how proof of work blockchains, in particular, may migrate toward cleaner alternatives and renewable energy solutions." The committee's Energy subcommittee also has a meeting lined up for next week on subpanel Chair Bobby Rush 's (D-Ill.) pipeline reliability and cybersecurity bill, the Energy Product Reliability Act. The legislative hearing is now scheduled for Wednesday after being postponed late last year. FOR YOUR RADAR: The Senate will vote today on Sen. Ted Cruz's (R-Texas) sanctions bill on the Nord Stream 2 pipeline. Though members of both parties called for robust sanctions enforcement last year, the Biden administration urged against Cruz's bill, saying it could disrupt a united U.S.-European front as Russia builds up its military presence on the Ukrainian border. Senate Democrats led by Sen. Bob Menendez (N.J) unveiled their own alternative legislation Wednesday that would impose sanctions only if Russia invaded Ukraine. HOUSE AG TALKS EV IN RURAL AREAS: Members of the House Agriculture Committee discussed the feasibility of electric vehicle expansion specifically in rural areas during a hearing Wednesday. Lawmakers in both parties raised questions over availability, cost and practical use in remote areas with limited electric resources. Rep. Doug LaMalfa (R-Calif.) expressed concerns over time periods when power is reduced in states like California to avoid wildfires and extreme heat. "Electric vehicles won't all charge at the same time," responded Lincoln Wood, electrification policy manager at Southern Company, adding that there are similar issues with limited gas as folks look to evacuate areas in the South due to incoming hurricanes. New legislation: Rep. Abigail Spanberger (D-Va.) introduced a bill Wednesday afternoon following the hearing to expand USDA's Rural Energy for America Program to include electric vehicle supply equipment. Currently REAP can't be used for electric vehicle charging infrastructure. ENVIRONMENTAL NOMS MAKE IT OUT OF COMMITTEE… AGAIN: The Senate Environment and Public Works Committee voted Wednesday to advance the nominations of Chris Frey to be assistant EPA administrator for research and development; and Martha Williams to be director of the Fish and Wildlife Service. Frey had already been voted out of committee last December, but he and Williams had to be renominated at the start of the new year. Chair Tom Carper (D-Del.) held the nomination of David Uhlmann to be assistant EPA administrator for enforcement and compliance assurance pending an outstanding information request from one of the committee members. Uhlmann advanced out of EPW last year but also had to be renominated. Pro's Alex Guillén has more. | | | — "A Forgotten Oil Well Births a 100-Foot Geyser in West Texas," via Texas Monthly — "Zero-emission, all-electric school buses to be manufactured in West Virginia," via West Virginia MetroNews. — " Can Biden's Infrastructure Law Save Benton Harbor?" via The New Republic — "Biden team weighs killing Trump's new nuclear weapons," via POLITICO. — "IEA chief accuses Russia of worsening Europe's gas crisis," via The Financial Times. THAT'S ALL FOR ME! | | | | Follow us on Twitter | | | | Follow us | | | | |
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