FERC'S PIPELINE RESET: FERC will dive back into its contentious pipeline policies today, and it could deliver some clarity for the gas industry, which has been clamoring for changes in the month since the commission approved an overhaul in how it determines whether a pipeline is needed. FERC Chair Richard Glick and Commissioner Willie Phillips recently said they were open to making some changes to allay industry concerns, just weeks after they voted to pass the policies that put more scrutiny on the greenhouse gas emissions from pipelines as well as an emphasis on environmental justice in siting or approving a project. The greenhouse gas policy statement specifically was intended to be an interim policy and remains open to changes. Former FERC Chair Neil Chatterjee has been among the loudest voices calling for FERC to at least pause applying the policy statement for pending projects — and he reiterated that point in an email. "I think that would calm the waters and reduce the uncertainty the issuance of the statements has caused," he told POLITICO's Catherine Morehouse. Republicans and Senate Energy Chair Joe Manchin have blasted the policy shift as agency overreach, and committee Republicans introduced a bill Wednesday to stop the move from taking effect. During a Senate Environment and Public Works hearing on energy security Wednesday, Sen. Dan Sullivan (R-Alaska) characterized the policy statements as part of a Biden administration "focus on shutting down the production of oil and gas." (More on the hearing later.) But environmentalists say the criticisms of the policy statements are overblown. The backlash ignores or mischaracterizes a series of legal setbacks that had prompted the commission to rethink the rules in the first place, says Moneen Nasmith, a senior attorney at Earthjustice. And even though some environmentalists would like to see the policy statements go further on greenhouse gas emissions in particular, she says the current statements better balance the pros and cons of building a new pipeline — something the courts have directed FERC to do time and again. "That, to me, seems like a very rational reaction on the part of a regulator [after] having had so many of its decisions struck down," she said. ME FIRST: MCCONNELL WEIGHS IN: Senate Minority Leader Mitch McConnell is joining the chorus of conservative opposition to the FERC statements today and plans to write to Glick this morning that the timing of the policy statements was "especially baffling" with the U.S. shoring up its LNG export capacity to help meet Europe's energy needs. McConnell said the statements would complicate approvals with "new ill-defined 'environmental justice' factors" and considerations for climate effects, "many of which are not even under pipeline builders' control." McConnell cited 15 pipeline projects awaiting FERC approval, which have been pending for an average of more than 480 days, as examples of a sluggish permitting process holding up capacity growth. "At a time when we should be looking for ways to expedite the approval of these important projects, the Commission has chosen on a purely partisan basis to do the exact opposite," McConnell writes in a draft of the letter obtained by ME. "Erecting new roadblocks to affordable, abundant energy makes no sense, particularly in this tenuous time." McConnell is the highest profile Republican to speak out about the policy statements, and he pointed to Manchin's statements against the policy statements as a sign of "bipartisan opposition — if not outrage." Read the letter here. GREAT LEASING EXPECTATIONS: Signs are pointing toward the Interior Department announcing an onshore lease sale in the next month, a person with knowledge of the agency's plans tells POLITICO's Ben Lefebvre. The Department hasn't held one since President Joe Biden took office, leaving Republicans and Manchin, whose committee oversees Interior, fuming. Interior had planned to hold an onshore lease sale in March, but scrapped it after a federal judge ruled that it couldn't use the social cost of greenhouse gas as a factor in its environmental review, an aide for Congressional Democrats familiar with the situation told ME. Now that an appeals court has blocked that decision, Interior may wish to announce a sale soon, the aide said, especially given that it needs Manchin's vote to clear from committee Laura Daniel-Davis, Biden's nominee to lead the department's land and minerals office. "They did a lot of the pre-planning and analysis at the end of last year" for a potential sale in March, said the aide, requesting anonymity to speak about the issue. "I also think Joe Manchin's getting pretty wound up wanting to see some type of sale proceed." Manchin's office did not reply to questions. Interior declined to answer questions about when and where an onshore lease sale might happen. The agency announced last week that it was resuming lease sale planning given the appeals court decision, but did not offer a timeline. GOP lawmakers are wondering if the agency is in fact dragging its feet on planning, given that Interior didn't announce a single lease sale for all of 2021 until a Louisiana judge forced it to hold one in the Gulf of Mexico in November. "It does seem to be turning into a de facto moratorium," said an aide for Republicans on the House Natural Resources Committee. BIDEN TIME IN BRUSSELS: President Joe Biden is meeting in Brussels with NATO, G-7 and European Union leaders on the Russian invasion of Ukraine, and energy issues are top of mind. National Security Adviser Jake Sullivan told reporters Wednesday on Air Force One Biden will drop a big announcement Friday on reducing Europe's energy dependence on Russian gas. Sullivan wouldn't preview any action, but he said the "practical roadmap for how to do that — what steps have to be taken, what the United States can contribute, what Europe has to do itself — this has been the subject of intense back-and-forth over the course of the past few days and weeks." The reveal will probably come at an event with European Commission President Ursula von der Leyen. Sullivan stressed, however, that Biden would not pressure European leaders to join him in banning Russian energy imports. AN ENERGY MARSHALL PLAN: A handful of Democratic senators are offering up some thoughts on how to get Europeans off of Russian energy. In a letter to Biden Wednesday, Sens. Elizabeth Warren (Mass.), Ed Markey (Mass.), Martin Heinrich (N.M.), Cory Booker (N.J.) and Jeff Merkley (Ore.) urged the administration to use the Defense Production Act and military sales to boost manufacturing of electric heat pumps, efficient electric appliances and renewable energy technology. They also asked the president to push for reduced trade barriers and to ramp up clean energy exports to "mirror the Lend-Lease Act program implemented during World War II, through which the United States sent critical supplies to Allied nations invaded by Germany." Energy Secretary Jennifer Granholm also pitched a Marshall Plan-esque energy overhaul on Tuesday to transition to cleaner energy, but said that doesn't have to come at odds with her calls to produce more oil and gas to offset market disruptions over the war in Ukraine. Speaking in Paris for the International Energy Agency Ministerial, Granholm said the two priorities were not a "binary choice" and that "both crises need addressing now." "The future of energy security, the future of economic security, the future of national security, the future of climate security — these are all inextricably bound together," she said, later adding: "I think it's a moment for us to ask at this point in our history, what is going to be our version of the Marshall Plan for clean and secure energy in 2022 and beyond?" POLITICO's Kelsey Tamborrino has more on Granholm's Paris remarks. New data from the Federal Reserve Bank in Dallas shows oil and gas producers are ramping up drilling activity. Its business activity index for the 141 companies in Texas, northern Louisiana and southern New Mexico who responded to a survey jumped to 56.0 in the first quarter from 42.6 in the fourth quarter to reach its highest reading in the survey's six-year history, But oil companies are not optimistic about the long-term future of the industry, with the survey noting the "outlook uncertainty index also jumped from -1.5 to 31.9, suggesting uncertainty became much more pronounced this quarter." And many respondents blamed investors still hesitant to invest more in production in addition to government regulations and market uncertainty over the war. Ben has more on the survey. RUBLE ROLL: Russian President Vladimir Putin launched a gambit to try to undermine the sanctions that have crippled his economy and are threatening to gut the country's energy industry: he wants European countries to pay for Russian natural gas in rubles. "I have decided to implement a set of measures to transfer payment for our gas supplies to unfriendly countries into Russian rubles," Putin said at a televised government meeting. Putin said he'd still fulfill all contracted sales and the "changes will affect only the payment currency." That would be a significant change under the existing contract terms, and sets up a confrontation with the EU countries that buy $30 billion to $40 billion a year in gas from Russia. And even if they agreed to the new terms, it's not clear where the European states would get those rubles. Aside from trying to nudge Europe to moderate its sanctions, the move would help stabilize the slumping currency, whose value has plummeted 40 percent since the start of the invasion. Its value climbed 5 percent after Putin's announcement.
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