- Oil & Gas Journal: Report: U.S. oil, gas spending, revenues, reserves rose last year
- Oil & Gas Journal: GOP Senate panel members criticize draft federal ozone standards
POLITICO Morning Energy for 6/4/2015
By DARIUS DIXON, with help from Alex Guillén, Elana Schor, Darren Goode, Andrew Restuccia and Jennifer Scholtes
PLEASE SIR, MAY I HAVE SOME MORE E&C: There’s plenty to say about Energy Department efficiency programs and FERC enforcement operations, and members of the House Energy and Commerce are looking to pick up the conversation again this morning. E&C’s Energy and Power subcommittee took testimony from DOE and FERC witnesses Wednesday afternoon to discuss the energy efficiency and accountability titles of draft legislation Republican leaders are molding under their Architecture of Abundance rallying cry. But if you’re listening today for the efficiency portion, you should probably find some other way to spend you morning. The half-dozen nongovernmental witnesses that lawmakers have lined up are focused on FERC enforcement, power market rules, and reforms to the Public Utility Regulatory Policies Act.
Wednesday’s hearing was pretty civil but that doesn’t mean it was tension-free. For one, FERC enforcement director Larry Parkinson made it clear that he wasn’t a fan of draft language to create new procedural rules for the agency’s market manipulation investigations. “The Office of Enforcement is not some standalone enforcement entity out there doing its thing without any oversight from the commission,” said Parkinson. He also said that it was “a little ironic” and “puzzling” that some GOP proposals would “erect barriers between the enforcement staff and the commission” if “one of the goals is to make sure the enforcement program has proper oversight by the commission.” He offered a convenient bulletpointed list of his critiques: http://1.usa.gov/1Ij266n
ME would’ve paid good money for this match-up: Without calling out anyone by name, Parkinson said that, “a couple of individuals have caricatured our enforcement program as a bit of an outlier in the federal enforcement process.” He added: “There’s been an attempt, not by this committee, but by some in the community to conflate” the investigative and adjudicative components of FERC investigations. It’s hard to imagine that William Scherman wasn’t high on — or at the top of — Parkinson’s list. Scherman, a former FERC general counsel, who has since represented firms targeted by the agency like JPMorgan, co-authored a paper criticizing the agency’s enforcement work that was coincidentally (http://politico.pro/1FUSUBy) published during Bay’s confirmation process. Well, Parkinson isn’t at the witness table today but Scherman is and there are plenty of Republicans who want to hear his side — and Democrats who’s like to cut him off at the knees.
If you go: The hearing starts at 10:15 a.m. in Rayburn 2322. http://1.usa.gov/1HL3v06.
CLIMATE GURUS TO HEADS OF STATE: SEE YOU AT THE SIGNING PARTY: But not before! Presidents and prime ministers may find themselves playing a supporting role at the December climate change talks in Paris, Pro’s Andrew Restuccia reports. Those who have to get into the weeds of the issue would prefer that the top brass use their political profiles to rally support for a deal rather than directly leading the complex negotiations. French officials are already working to curtail the involvement of heads of state in the talks. They don’t want to repeat the mistakes of a 2009 climate summit, when a cadre of world leaders converged in Copenhagen in anticipation of a breakthrough deal, only to get sucked into the negotiations that failed to yield a major agreement.
An army of presidents and prime ministers and their entourages could also inflate expectations about what can actually be accomplished at the talks; most observers expect a modest deal that won’t come anywhere close to solving the climate crisis, but will help set the course for setting a peak for emissions. Andrew has more for Pros: http://politico.pro/1GmbdTn
TAKIN’ IT TO THE EX-IM: Export-Import Bank chief Fred Hochberg is testifying before the Senate Banking Committee this morning and observers will be looking to see what panel chairman Richard Shelby has to say. He’s pressed for reforming the bank — not scrapping it altogether as some House Republicans have suggested — and said he might unveil Ex-Im-centered legislation after today’s hearing.
If you go: The hearing starts at 10 a.m. in Dirksen 538.
WELCOME TO THURSDAY! Or as your morning host is calling it, T-minus-two. I’m Darius Dixon and my brow is beginning to sweat this plan to jet off to Japan in slightly more than 48 hours. I’m sure it’ll all go fine (right?) but as a guy who likes to be overly prepared for just about everything, I feel like I’m running ahead of that boulder in the Temple of Doom. On the plus side, no one’s going to mistake me for a local so a lot will be overlooked. Send your soothing vibes — and energy tips to ddixon@politico.com, and follow us on Twitter @dariusss, @Morning_Energy and @POLITICOPro
CHARTING AVIATION’S REGULATORY FLIGHT PATH: Pro’s Alex Guillén shakes out how the EPA’s plans to regulate greenhouse gas emissions from airplanes could soar or sink: “Observers expect EPA will issue a so-called endangerment finding that concludes airline emissions pose a threat, a sequel of sorts to the agency’s 2009 ruling that emissions from cars present a health danger, a ruling later extended to include power plants. But the path forward on a rulemaking that would actually limit airplane emissions faces multiple obstacles. The airline industry’s international status makes tackling solely the U.S. portion of the emissions difficult. The European Union has instituted its own airline emissions trading scheme, but criticism from U.S. carriers prompted Congress in 2012 to ensure that U.S. flights would not have to comply.” http://politico.pro/1BLcnkd
CRS ON CRUDE EXPORTS: UNDERCUTTING RUSSIA NOT SO EASY: The potential for U.S. crude exports to counter Russia’s influential role as fuel supplier to Eastern Europe could face some hurdles, according to a Congressional Research Service memo. CRS identified three factors that as potentially limiting the ability of U.S. crude to supply Eastern Europe: infrastructure, refining capacity and pricing. The memo, a copy of which was obtained by POLITICO, presents possible ammunition to supporters of the current crude export ban as they seek to undercut the argument that a free flow of light U.S. oil would reduce Russia’s regional clout. The CRS memo underscores that researchers were not equipped to properly gauge “the suitability of existing infrastructure in the Eastern European region” to handle competing types of crude from the U.S., but noted that the bulk of Russian crude comes to its neighbors via pipeline as opposed to the marine delivery system that U.S. shipments would need. In addition, CRS notes, Eastern European refineries are broadly configured to process Russia’s heavier crudes and could demand a price discount before purchasing lighter U.S. shale grades to make up for the mismatch. “This, in turn, may result in reducing the attractiveness to U.S. producers to export crude oil to the region,” the memo states. The memo: http://politico.pro/1FvadGO
PHMSA: SANTA BARBARA SPILL PIPE CORRODED: Plains Pipeline announced late Wednesday night that it received a new filing from the Pipeline and Hazardous Materials Safety Administration that noted external corrosion and a six-inch opening near the bottom of the pipe that ruptured last month in Santa Barbara County, Calif. But the filing also said that the level of corrosion “would not be expected” given the amount of protection the company had employed. The pipe is still being tested. http://bit.ly/1KFrFfm
HOUSE POISED TO POLISH OFF THUD TODAY: Buzzing with action late into the night, the House plowed through debate on the THUD spending bill, lining up a slew of amendment votes for today. House leaders have promised lawmakers they’ll be heading back home to their districts no later than 3 p.m., so expect some legislative efficiency. During the Wednesday night debate-a-thon, the chamber agreed to several amendments by voice vote, including one to increase funding for PHMSA by $500,000.
Vote Watch: Amendments held over for roll call votes today include one by Rep. Lois Capps to increase funding for the Pipeline Safety Oil Spill Liability Trust Fund by a whopping $27.6 million.
LAWYERS AND PROFS POLLED ON CARBON REGS: Sure, you could wait for the courts to rule on the legality of EPA’s Clean Power Plan, but where’s the fun in that? Brian Potts of Foley & Lardner and Abigail Barnes, a student at Vermont Law School and Yale University, anonymously polled 130 lawyers and law professors about the legality of EPA’s carbon rules — and they found a pretty even split. Overall, 59 respondents said it is legal, while 58 said it is not and 13 said they didn’t know. Despite being unable to make any strong conclusions from the survey, Potts and Barnes write that “it’s fair to say that a significant portion of the environmental law community believes that the Clean Power Plan is on shaky legal ground.” More results: http://bit.ly/1cydtsN
By the numbers: While the overall numbers were roughly equal, things split differently when one considers demographics. Among private attorneys, who made up the majority of those polled, 45 said the CPP is illegal while 20 said it is legal. That balance flips when it comes to academia. 30 professors called the plan legal, while just 4 said it is illegal (no word on whether Laurence Tribe is one of them). In case you were wondering, 55 percent of respondents said they represent a client directly involved with the rule, and of that subset, 45 fell in the “illegal” camp while 20 fell in the “legal” camp.
DEPARTURES AND ARRIVALS: There are a lot of folks moving and shaking of late.
— Clay Schroers has joined the League of Conservation Voters as its new National Campaigns Director, taking over for Scott Fairchild. Schroers, who hails from Honolulu, recently served as Sen. Brian Schatz’s campaign manager in a race that involved running against Colleen Hanabusa, the late Sen. Daniel Inouye’s handpicked successor, in the Democratic primary. Schroers has spent more than a decade in electoral politics. For LCV, he’ll be working to promote green candidates in 2016 congressional races.
— Schatz’s policy adviser for energy, environment, and climate, Ryan Martel, is leaving Capitol Hill soon. Martel joined the Hawaii Democrat’s staff two years ago after working his way up to being former Sen. Jeff Bingaman’s staff director on the Finance Committee’s energy, natural resources, and infrastructure panel. He’s taking a job with the Boston-based climate advocacy group Ceres next week as its senior manager of the policy working with its Investor Network on Climate Risk.
— Jamison Foser, a former senior fellow at Media Matters for America and a researcher for the DCCC and DNC, has joined NextGen Climate, a baby of billionaire global warming activist Tom Steyer, as an adviser to the group. The hire comes just days after Bobby Whithorne, NextGen’s spokesman and Obama White House alum, decamped to join Porter Novelli as VP on its reputation management team.
CHAFEE CHASTISES W. ON CLIMATE, WAR: Lincoln Chafee officially threw his hat into the ring for the Democratic presidential nomination on Wednesday. And he also tied his two campaign themes — opposition to the 2003 Iraq war and environmental stewardship — together by saying his distrust of the George W. Bush administration’s WMD claims stemmed stemmed from Bush backing out of a campaign promise to regulate carbon dioxide from power plants.
Chafee recalled attending a Senate Republican breakfast featuring then Vice President Dick Cheney in early 2001. And the GOP senators “were all over” Cheney about EPA Administrator Christine Todd Whitman going on talk shows saying the administration would be regulating CO2 from power plants. Cheney stood up, Chafee said, and announced his new energy policy — sans CO2 regulation. “I just about fell off my chair,” Chafee recalled. “All of the other senators stood up and started cheering.” “When I talk about not trusting them on weapons of mass destruction, that was a big reason why,” he added. “You don’t go before the people and say something when you’re campaigning and then change it just weeks into your administration.”
PAGING TENNESSEE: The Economic Policy Institute is out with a new study today ripping the Obama administration’s proposal to sell off all or part of the Tennessee Valley Authority because of its growing bond debt. In ME’s humble opinion, this has become something of a perennial budgeting technique for the White House since it knows full well that privatizing TVA ain’t gonna happen — just like the kabuki around threats to make big cuts in the home heating oil program. But writing it down is fiscally convenient. The report: http://bit.ly/1Mnpk9Z
INDY OIL THANKS UPTON ON EXPORTS: House Energy and Commerce Chairman Fred Upton may have stopped short of endorsing unfettered crude exports when he spoke out earlier this week in favor of closer congressional scrutiny of proposals to end the long-standing ban on overseas oil sales, but that isn’t stopping the industry from continuing to cheer the Michigan Republican’s subtle shift. In a letter to Upton yesterday, the Independent Petroleum Association of America President Barry Russell said that any fears of a gasoline price increase resulting from a repeal of the export ban “have been adequately addressed” and that he was “encouraged” by Upton’s comments. The full letter: http://bit.ly/1dN86rs
QUICK HITS
— OPEC’s Problem: There Is No Minister of Shale. The Wall Street Journal: http://on.wsj.com/1RL3IHB
— California Senate approves legislation to combat global warming. San Jose Mercury News: http://bayareane.ws/1M6yG9u
— At OPEC the Saudi Oil Minister Mainly Wants to Discuss Solar Power. Bloomberg: http://bloom.bg/1BLiIMw
— Patriot Coal in Deal to Sell to Blackhawk Mining. The Wall Street Journal: http://on.wsj.com/1SXnTUg
— Why You Should Be Skeptical Of Big Oil Companies Asking For A Price On Carbon. Think Progress: http://bit.ly/1JrUldc
— Damaged Wing Grounds Solar Impulse Plane in Japan For a Week. NBC News: http://nbcnews.to/1AP1eUo
Tags: energy, fuel, gas, oil