Back to square Manchin

Mar 03, 2022

With help from Catherine Morehouse, Josh Siegel and Kelsey Tamborrino

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QUICK FIX

— Sen. Joe Manchin outlined what he sees as a workable framework to get Democrats' agenda back on track, and climate stalwarts reacted positively.

— The Federal Energy Regulatory Commission heads to Capitol Hill for the first time since the Democratic commissioners voted to adopt a new climate and environmental justice review policy for natural gas pipelines.

— Sen. Lisa Murkowski wants to partner with Manchin to halt Russian oil imports, even if it means raising already high gas prices.

WELCOME TO THURSDAY! I'm once again your substitute host, Zack Colman — Josh Siegel is taking over tomorrow (he's at joshuasiegel@politico.com ). Big ups to Luke Rose of The Rose Company, LLC for knowing Jim Joyce was the umpire that gave us "The Imperfect Game." Sigh. Maybe baseball will happen this year. For today: Mike Mogis and Justin Oberst, brother of Bright Eyes frontman Conor, started a record label named after what Omaha, Neb., street? Send your tips and trivia answers to me at zcolman@politico.com.

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: How the GOP is using Ukraine to attack Biden's climate policies.

Driving the Day

YOUR REGULARLY SCHEDULED MANCHIN WATCH: Sen. Joe Manchin (D-W.Va.) laid out what he could accept in a broad social spending bill, potentially giving Democrats a chance to get their political agenda back on track — including cash for addressing climate change, POLITICO's Burgess Everett and Nicholas Wu report . Here's the broad contours: Start with tax and prescription drug reform, while using half of that money to battle inflation and debt while the rest goes to climate and social spending. "If you do that, the revenue producing [measures] would be taxes and drugs. The spending is going to be climate," Manchin told Burgess and Nicholas, adding, "And the social issues, we basically have to deal with those" afterward.

Manchin noted there's no formal negotiations with the White House , though conversations happen. Notably, Manchin didn't offer a price tag. The moribund Build Back Better legislation stood at $1.7 trillion, which included $555 billion in climate-related incentives. Biden pushed for passing clean energy and manufacturing tax credits in his State of the Union address on Tuesday, using a somewhat-Manchin-friendly framing that electrifying vehicles, boosting energy efficiency and curbing greenhouse gas emissions will yield savings for everyday Americans.

Several Democratic colleagues found the West Virginia senator's comments encouraging, Josh Siegel reports. Senate Finance Committee Chair Ron Wyden (D-Ore.) said it was a boon to the clean energy tax credits he has tried to shepherd across the congressional finish line. "Sen. Manchin with his statement today clearly opened the door," he told reporters. Sen. Sheldon Whitehouse (D-R.I.) told Josh that Manchin has "been positive about a significant portion" of the tax measures that comprise a bulk of the Democrats' climate spending plans, adding Manchin also has "been supportive of a methane program'' to reduce emissions of the potent, heat-trapping gas from oil and gas operations. "So it ain't over," Whitehouse said. Added Sen. Ed Markey (D-Mass.): "He said climate was the easiest part to get to yes on, and whatever else we can get 50 votes we can throw it in. And that's a bill."

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On the Hill

BAN THE BARREL: Manchin and Sen. Lisa Murkowski (R-Alaska) are teaming up on legislation to block imports of Russian crude oil and petroleum products in hopes of pressuring the Kremlin to back off its war in Ukraine, Ben Lefebvre and Josh Siegel report for Pros. Whether it would get enough support for Senate passage is unclear, though it likely has quite a few GOP backers. Even climate hawk Markey has supported the basic idea, though he's offered his own bill.

What's more clear: Halting Russian energy shipments would take supplies off the market, hiking gasoline prices when Biden and Democrats are taking heat for rising consumer costs. Biden told reporters Wednesday that stopping Russian energy imports is not "off the table." Yet it's not a route the administration prefers – after all, Biden in his State of the Union address positioned the release of 30 million barrels of oil from the Strategic Petroleum Reserve as gas pump relief. Gas prices averaged $3.60 per gallon on Wednesday, the highest level in eight years.

But that pain is worth it to thwart Russian President Vladimir Putin, Murkowski told Josh . She said Putin "has used energy as a weapon," and the U.S. and allies must push back even if it boosts gas prices. "We are going to see price increases. Nobody wants to see that. And this is going to hurt. But we all need to recognize Europe is in the midst of a war with Russia now. Innocent people are dying, children are dying. We have not been in as volatile as a situation as anytime in my life. And so we are looking right now from a very short window."

GLICK TAKES CLIMATE POLICY TO THE HILL: All five FERC commissioners face the Senate Energy and Natural Resources Committee today, where the three Democratic regulators will have to defend their decision to open up the nation's gas infrastructure to greater climate and environmental justice scrutiny - over the objections of their Republican colleagues. The hearing marks two weeks since FERC's majority voted to update its pipeline policy for the first time since 1999 – subjecting projects above a certain GHG intensity to additional environmental reviews and promising a more robust examination of whether a pipeline is really needed, following several court rulings that questioned the commission's decision-making on gas infrastructure.

The policy change was met with derision from industry, Republicans and Manchin, who called it "reckless." In his opening statement for today's hearing, shared with ME, Manchin wrote bluntly: "I believe the new policy statements overshoot what was necessary and in the national interest," adding the guidance is a "shortsighted attack on fossil fuel resources" that is part of "an effort underway by some to inflict death by a thousand cuts."

Trade groups representing gas companies reiterated their criticisms of the policy ahead of the hearing on Wednesday: The American Gas Association sent a letter to ENR Chair Manchin and Ranking Member John Barrasso (R-Wyo.) questioning whether the commission had moved beyond its statutory authority, and the Interstate Natural Gas Association of America held a press conference where they discussed potential litigation strategies.

INGAA is still discerning how to best challenge the policy, Joan Dreskin, the trade association's senior vice president, secretary and general counsel, told reporters. A key question is whether the statement is considered a new rule that can be challenged, or guidance which is more difficult to litigate against. From INGAA's vantage point, there are aspects of the policy statement that appear more like rules, rather than guidance, and the group is continuing to dig into whether it can be appealed to the courts, she said. FERC Chair Glick told POLITICO after the vote that he does not believe the statement itself will be challenged, though individual decisions might be.

LAWMAKERS INTRODUCE NUCLEAR WASTE BILL: Bipartisan lawmakers are pushing new legislation to prevent their states from becoming the de facto permanent home of the nation's nuclear waste. Sen. Martin Heinrich (D-N.M.) and Sen. Ted Cruz (R-Texas) and Rep. Teresa Leger Fernandez (D-N.M.) and Rep. August Pfluger (R-Texas) announced legislation Wednesday that would prohibit the use of federal funds for the private interim storage of spent nuclear fuel until a permanent repository is made available. It also would require the Energy Department to submit a report to Congress on possible locations or a possible siting process.

The bill lands as two private companies have submitted applications for the construction and operation of consolidated interim storage facilities in both New Mexico and Texas. While both New Mexico Gov. Michelle Lujan Grisham and Texas Gov. Greg Abbott have opposed the facilities, the Nuclear Regulatory Commission has already granted a license to Interim Storage Partners LLC for the spent nuclear fuel facility in Texas, and is soon expected to weigh in on a plan from Holtec International for an interim facility in New Mexico.

The Biden administration — which has targeted a carbon pollution-free electricity sector by 2035 — opposes the Yucca Mountain repository in Nevada and instead has called for a return to consent-based siting, which would draw community input before deciding where to locate any storage facility. DOE is currently seeking input until Friday on the siting process for the temporary storage of spent nuclear fuel.

"Until the Department of Energy fulfills its statutory responsibility to provide permanent waste disposal, interim sites can become permanent sites. That is not something my state is signed up for," Heinrich said in a statement Wednesday.

Around the World

PLASTIC WRAPPED: The United Nations greenlit a plan to establish the first-ever legally binding agreement to end plastic pollution. The 175 nations that endorsed the resolution will begin their work this year and hope to finalize a draft agreement by 2024. It will cover the whole lifecycle for plastics, from production to disposal. Inger Andersen, the U.N. Environment Programme's executive director, called it "the most significant environmental multilateral deal since the Paris accord" on climate change. The U.N. noted curbing plastics would bring health benefits, such as reduced air pollution and exposure to potentially toxic chemicals.

Plastics production is an increasingly large slice of global greenhouse gas emissions – the U.N. forecast that making, designing and disposing plastic products would account for 15 percent of global emissions if nations were to keep temperatures from surpassing 1.5 degrees Celsius above pre-industrial levels.

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