| | | | |  | | By Josh Siegel | Presented by Chevron | With help from Kelsey Tamborrino, Ben Lefebvre and Catherine Morehouse 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.
| | | — Democrats unveil their first small legislative step to counter high gasoline prices, but their options to make a difference appear limited. — Sen. Joe Manchin says expanding electric vehicle tax credits is "ludicrous," pouring cold water on a key party priority for a potentially revitalized reconciliation package. — Interior says it has no timeline for unveiling a new five-year offshore oil and gas leasing plan, upsetting an industry that sees inconsistency in Biden administration policies. WELCOME TO FRIDAY! I'm your host, Josh Siegel. Khary Cauthen of Cheniere Energy correctly answered yesterday's trivia question. Charles Mingus was a famous jazz musician who also wrote an instructional booklet for how to toilet train a cat. Today's question: Kendrick Lamar is finally giving us new music next month after five years of quiet. What is the name of his first studio album? Send your answers to joshuasiegel@politico.com and mchoi@politico.com. Find me on Twitter @SiegelScribe and Matthew @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: Democrats take gas price solutions for a spin.
| | | | | A message from Chevron: The Permian Basin in Texas and New Mexico is one of America's most prolific oil and natural gas resources. By the end of this year, we plan to increase Chevron's Permian oil and natural gas production by 10% while continuing to reduce our operations' carbon and methane emissions intensities. | | | | | | GAS PRICE WHISPERS: Democrats are saying the quiet part out loud — their scramble to contain the political fallout from high gasoline prices is intended to persuade voters, rather than actually bring down costs at the pump, since none of their ideas would likely do much to affect the marketplace. "Public sentiment is everything," House Speaker Nancy Pelosi said at a press conference Thursday in which she and Senate Majority Leader Chuck Schumer touted "new legislative efforts to lower gas prices for American families." But their only announcement to speak of is planned legislation — not formally introduced yet — to strengthen the powers of the Federal Trade Commission to investigate whether fuel manufacturers are keeping prices artificially high. Never mind that the Biden administration has already called on the FTC to issue such a probe, and that previous gasoline price gouging investigations over recent decades have not found any wrongdoing. In focusing their initial legislative efforts here, Democrats are acknowledging other ideas floated by vulnerable members, such as the gas tax holiday and providing direct rebates to drivers, are dividing the caucus. Pelosi herself threw more cold water on doing a national gas tax holiday, calling the idea "good PR" but not effective. Democrats on Thursday acknowledged the predicament they're in, while still holding out hope they can eventually rally around other legislative solutions. "I am hopeful we will do something more forceful than just a FTC investigation. That's a start," said Rep. Peter DeFazio (D-Ore.), who also opposes the gas tax holiday but is pushing a bill he introduced taxing large oil and gas companies' windfall profits from surging crude prices and returning the revenue to consumers. Rep. Pramila Jayapal (D-Wash.), the chair of the Congressional Progressive Caucus, said her group is also pushing several other ideas to address "price gouging" by oil companies. "This [legislation boosting the FTC] is a good first indication, but we are going to continue to push for something that holds oil and gas companies responsible for the profiteering," Jayapal told your ME host. Sen. Tina Smith (D-Minn.) acknowledged that going after oil companies might not be constructive in bringing down prices, even as she agrees with the political strategy behind focusing on that issue. "What's going to cause a reduction in oil prices is Saudi Arabia increasing oil production," Smith told ME. But she dismissed concerns that Democrats' searching for short-term answers that might not bear fruit would distract from their bigger picture effort to make the case for passing a reconciliation package that would accelerate the transition to clean energy. "People get that we need to try to do what we can — and what we can do is limited — to lower gas prices right now, while we make the changes we need to make so we are not in this position again, and that's moving more to clean power. You can hold both of those ideas in your head at the same time," Smith said.
| | | | DON'T MISS ANYTHING FROM THE 2022 MILKEN INSTITUTE GLOBAL CONFERENCE: POLITICO is excited to partner with the Milken Institute to produce a special edition "Global Insider" newsletter featuring exclusive coverage and insights from the 25th annual Global Conference. This year's event, May 1-4, brings together more than 3,000 of the world's most influential leaders, including 700+ speakers representing more than 80 countries. "Celebrating the Power of Connection" is this year's theme, setting the stage to connect influencers with the resources to change the world with leading experts and thinkers whose insight and creativity can implement that change. Whether you're attending in person or following along from somewhere else in the world, keep up with this year's conference with POLITICO's special edition "Global Insider" so you don't miss a beat. Subscribe today. | | | | | | | | ROLL OUT … EV TAX CREDIT 'LUDICROUS': Sen. Joe Manchin (D-W.Va.) reiterated Thursday that he is not eager to roll out generous tax credits to electric vehicles, casting further doubt into the viability of Democrats including that piece as part of a revived reconciliation bill. Manchin said continuing to offer an EV tax credit when demand for them outstrips supply is "ludicrous." "There's a waiting list for EVs right now," Manchin said during a Senate Appropriations Committee hearing on the administration's fiscal 2023 budget request for DOT, reports Pro's Tanya Snyder . "But they still want us to throw $5,000 or $7,000 or a $12,000 credit to buy an electric vehicle. It makes no sense to me whatsoever, when … we can't produce the product for the people who want it, and we're still going to pay them to take it? It's absolutely ludicrous in my mind." Biden's Build Back Better bill — which Manchin tanked last winter — would have expanded the tax credit for EVs to up to $12,000. A semiconductor shortage is currently slowing the production of all automobiles, but especially EVs, which require more than twice as many as a traditional gasoline-powered car. The supply of minerals for EV batteries is also an ongoing issue that could get worse as U.S. production of electric vehicles increases. LONG LIVE LNG: Energy Secretary Jennifer Granholm told House Republicans on Thursday that the Biden administration fully backs producing and exporting as much natural gas as possible — but argued the federal government can only do so much to get projects to the finish line, Pro's Catherine Morehouse and Kelsey Tamborrino report. DOE has permitted nearly everything that's fallen under its jurisdiction, giving a green light to LNG plants that together can ship almost three times the volume the U.S. currently exports, Granholm said at a hearing of the House Energy and Commerce Committee's energy subcommittee. But the companies that have received approvals for several LNG terminals from DOE have begun construction, as they wait to secure financing that has dried up for long-lived fossil fuel projects. "The number one thing is Wall Street; Wall Street is constricting their ability to invest in increased production," Granholm told lawmakers, citing a report polling oil and gas executives that found volatile markets, not the federal government, were preventing them from increasing fuel production. "It is a false statement, with all due respect, to say that the Biden policies have caused production to go down." FIVE-YEAR WHAT NOW? Interior says it has no timeline for unveiling a new five-year offshore leasing plan and hints that it may not have any more offshore leases to be held this fiscal year up its sleeve, either. In a budget hearing before members of the House Appropriations Committee, Interior Secretary Deb Haaland chalked up the delay to a combination of the department being in the center of a crossfire of lawsuits surrounding its leasing program and the Trump administration's own on-again, off-again work on a new five-year plan. "There's a significant amount of work that still needs to be done," Haaland said at the hearing," reports Pro's Ben Lefebvre. "You also know that there is a lot of varying and conflicting litigation that has been a complicating factor for our department." Almost needless to say, the American Petroleum Institute was not bowled over by Haaland's lack of details. "At a time of rising geopolitical volatility and global energy price shocks, the lack of progress toward a 5-year offshore program is threatening America's long-term energy supply and creating significant uncertainty across the industry," API Senior Vice President of Policy, Economics and Regulatory Affairs Frank Macchiarola said in a statement to ME. "This is yet another example of the mixed signals coming from an administration that talks about the need for more domestic production but continues to create barriers to the energy development the nation and the world needs." IT'S COMING … WRDA MARKUP: Sen. Tom Carper (D-Del.), chair of the Environment and Public Works Committee, will announce plans Friday for his committee to markup the Water Resources Development Act of 2022 next Wednesday. This year's biannual water resources legislation makes several changes to ensure that the Army Corps of Engineers addresses climate change and equity for disadvantaged, rural, and tribal communities, according to a committee aide. The bill includes the bipartisan, bicameral Shoreline Health Oversight, Restoration, Resilience and Enhancement Act that aims to broaden the scope of projects authorized for the Corps to protect shoreline communities from erosion, coastal storm hazards and other impacts of climate change. CRABTREE IN: The Senate confirmed long-time carbon management expert Brad Crabtree on Thursday to lead the Energy Department's Office of Fossil Energy and Carbon Management after Texas Sen. Ted Cruz (R) lifted his hold on the nomination. NUCLEAR NOMINEE ADVANCES: The Senate Energy and Natural Resources Committee on Thursday advanced Kathryn Huff, Biden's nominee to head the Energy Department's nuclear energy office, with bipartisan support, Kelsey also reports.
| | | | JOIN US ON 4/29 FOR A WOMEN RULE DISCUSSION ON WOMEN IN TECH : Women, particularly women of color and women from disadvantaged socioeconomic backgrounds, have historically been locked out of the tech world. But this new tech revolution could be an opportunity for women to get in on the ground floor of a new chapter. Join POLITICO for an in-depth panel discussion on the future of women in tech and how to make sure women are both participating in this fast-moving era and have access to all it offers. REGISTER FOR THE CHANCE TO JOIN US IN-PERSON. | | | | | | | | NOT DOWN WITH SCC: Louisiana and other Republican-controlled states on Thursday asked the Supreme Court effectively to block the Biden administration's social cost of carbon metric in regulations, putting a core part of the president's climate agenda in front of the conservative-dominated high court, reports Pro's Alex Guillén. The strongly worded application portrays the social cost as "the most consequential rulemaking in American history" that touches on many aspects of American life. "And which sentence in the United States Code does the Executive Branch cite as the source of its congressional authority for any of this? Zilch," the states wrote. It's unclear whether SCOTUS will bite given that the 5th Circuit, widely considered the most conservative appellate court, recently found that the states lacked standing because the social cost metric on its own does not represent imminent harm The court has ordered the Biden administration to file a response by May 9 at 5 p.m. GOING POSTAL: Environmental groups and the United Auto Workers filed two lawsuits on Thursday seeking to block the Postal Service's acquisition of thousands of gasoline-burning trucks, Alex reports. USPS, still controlled by Postmaster General Louis DeJoy, a Trump-era appointee. should have purchased almost entirely electric vehicles, environmentalists and Democrats have complained for months. A group of states led by California and New York also sued on Thursday. ZONING OUT: A report drafted by technical experts at EPA calls for retaining the nationwide ozone standard without revision, which would keep in place a Trump administration policy that drew criticism from environmentalists, Alex reports. The report, if finalized with that recommendation intact, could make it difficult for Administrator Michael Regan to justify strengthening one of the most important air pollution limits in the country. GOVERNORS CALL FOR E15 PARITY: Bipartisan governors from Iowa, Illinois, Kansas, Minnesota, Nebraska, North Dakota, South Dakota and Wisconsin called on EPA on Thursday to promulgate a regulation establishing parity between E10 and E15 in their states. While the governors applauded EPA for its recent announcement to issue an emergency waiver for E15, they said "a permanent solution allowing the year-round sale of E15 is also needed for long-term certainty." The governors write that they're exercising their authority under the Clean Air Act and call on Administrator Michael Regan to start a rulemaking that would allow E15 in their states beginning with the 2023 summer season. Related: Reuters reported Thursday EPA is expected to send its biofuel blending mandates for 2020, 2021 and 2022 to the White House for final review by early next week.
| | | | A message from Chevron:   | | | | | | UNLEASHING RENEWABLES: Members of the largest regional grid operator in the U.S. endorsed a new plan to eventually free the region's clogged interconnection queue, the organization announced Thursday. The plan, brought forward by the PJM Interconnection, which stretches from Chicago to the Mid-Atlantic, would implement a two year "transition" to relieve the line of projects waiting to connect to the grid. These stalled projects total 225 gigawatts, more than 95% of which is capacity for renewable energy or energy storage resources. The plan would prioritize the 1,200 projects submitted before 2021, and includes a "fast lane" to prioritize about 450 projects, according to PJM. It will also prioritize projects that are fully permitted and financed, and aims for "clustering" projects to better split the cost of upgrading the grid to accommodate new resources. Previously, costs would often get assigned to one project developer, despite upgrades benefiting multiple projects, which would only serve to lengthen interconnection times. PJM plans to file the proposal with FERC in May. NEWSOM JOINS SOLAR PROBE FIGHT: California Gov. Gavin Newsom is the latest renewable energy advocate to oppose the Commerce Department's inquiry into solar components from four Southeast Asian countries, arguing the inquiry — which was requested by a California-based manufacturer — threatens the state's energy reliability. In a letter to Commerce Secretary Gina Raimondo obtained by ME, the governor said uncertainty from the probe is delaying at least 4,350 megawatts of solar plus storage projects in total nameplate capacity that the state needs to come online between 2022 and 2024 to fight climate change and provide power alternatives to retiring gas-fired units.
| | | Germany Drops Opposition to Embargo on Russian Oil via WSJ Europe Struggles for Clarity on Russia's Roubles-for-Gas Scheme via Reuters Ocean Animals Face a Mass Extinction From Climate Change, Study Finds via Washington Post Interior Moves Forward on 3 Western Transmission Projects via POLITICO Pro THAT'S ALL FOR ME!
| | | | A message from Chevron: Balancing energy security, costs, and the need to reduce emissions have become an increasingly important part of the energy conversation at home and abroad. In the Permian Basin, we plan to increase oil production by 10% in 2022 while continuing to reduce both carbon and methane emissions intensities. And in the years to come, we expect to grow our Permian production beyond 1 million barrels of oil equivalent per day. Every day, we look for opportunities to make our own environmental footprint smaller as we strive to produce energy that Americans—and customers throughout the world—can count on. Find out more. | | | | | | | Follow us on Twitter | | | | Follow us | | | | |
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