Energy News for March 19, 2015

  • by BPC Staff
  • on March 19, 2015


POLITICO Morning Energy for 3/19/2015

By DARIUS DIXON, with help from Erica Martinson, Alex Guillén and Elana Schor

WHAT YOU NEED TO KNOW ABOUT THE SCOTUS COAL CASE: The Supreme Court is about to hear a set of legal challenges to President Barack Obama’s biggest environmental regulation to date — one that bears much of the responsibility for the trend of coal-burning power plants shutting down. Next week’s oral arguments will give states and industry groups a last-ditch chance to try to derail a mercury rule for power plants that critics consider a bulwark of Obama’s so-called “War on Coal,” just weeks before the rule is scheduled to take effect.
Last year, a federal appeals court broadly upheld the mercury rule, backing the agency in a long list of legal challenges that states and industry groups had filed. But the Supreme Court has focused next week’s arguments on a single issue: Exactly when should EPA have considered the high costs of pollution controls? The law says that before EPA regulates mercury, acid gases and toxic metals from power plants, it must first determine whether doing so is “appropriate and necessary.” EPA took that as a question entirely of public health. But the rule’s opponents say Congress clearly would have considered “appropriate” to depend on cost. Erica Martinson gets Pros prepared:

An aside: This case reminded your morning host of the King v. Burwell case on healthcare exchanges and found this paragraph from Garrett Epps in The Atlantic enlightening — “Only about a third of the Supreme Court’s cases, in fact, directly concern the Constitution. The rest require the Court to interpret rollicking federal statutes … Interpreting statutes, however dull they may be, is the heart of what twenty-first century courts do; they have developed an elaborate, and not entirely coherent, set of tools to do that.”

OBAMA TO SIGN NEW GHG EXEC ORDER: President Barack Obama intends to sign an executive order this morning aimed at further reducing greenhouse gas emissions generated by the federal government, according to a White House official. The official said that several “major” government suppliers plan to make pledges to cut their own greenhouse gas emissions. Obama has criticized Congress for failing to address the threat from climate change, and today’s move is his latest use of the power of the executive branch to rein in the pollution that scientists blame for warmer temperatures and rising sea levels. After signing the executive order, Obama will head to the Energy Department — taking in the building’s Art de Bomb-shelter architectural style, no doubt — to tour its rooftop solar panels and attend a discussion with government suppliers about their emissions reduction targets or disclosing their emission figures.

HAPPY ALMOST-FRIDAY! I’m your host, Darius Dixon, and I honestly don’t get Starbucks’ “Race Together” campaign. I can appreciate intention here while not embracing execution. Send your energy commentary, news, scoops and tips to, and follow us on Twitter @dariusss, @Morning_Energy and @POLITICOPro.

TSCA DEBATE GETS TESTY: The intra-party dispute over a toxic chemicals bill intensified yesterday, with Senate Democrats trading barbs over whether the effort to update the 40-year-old law would undercut states’ ability to police dangerous substances. Amid pleas from the late Sen. Frank Lautenberg’s widow to pass the bipartisan compromise that would revise the 1976 Toxic Substances Control Act, Sen. Tom Udall, the lead Democrat on the bill, called on his party colleagues to “reject attacks on anyone’s integrity, character and motivations.”

And Bonnie Lautenberg went for the jugular: Lautenberg opened the hearing by imploring senators to compromise on what she said was an even more important legacy to her late husband than his success in banning smoking on airplanes. “This bill on chemical safety meant everything to him,” she said. “He wanted chemical safety to be his final, enduring legacy.” Darren Goode has the news:

HOUSE PASSES EPA ‘SECRET SCIENCE’ BILL: House Science Chairman Lamar Smith’s Secret Science Reform Act was approved yesterday on the floor on a 241-175 vote. Four Democrats backed the bill, which would bar EPA from using any scientific studies to set regulations without releasing all underlying data and research to the public for review. Much of the focus of hearings and letters has been on major epidemiological studies that were used in air pollution regulations, and EPA’s failure to turn over all of the related data to Congress. But apparently, EPA was able provide some of that data to Smith’s committee:

Even House Speaker John Boehner doused the bill in praise, saying it would “be good for American jobs, and it will rein in a serial offender against the public’s right to know what goes on in its government.”

PORTMAN SLIPS ENERGY BILL INTO BUDGET RES: No, it’s not the Portman-Shaheen efficiency bill. Sen. Rob Portman secured the inclusion of legislation, S. 765, to the Senate budget resolution designed to improve how the Congressional Budget Office accounts for certain energy performance and service contracts when private companies are brought in to help reduce the federal government’s energy use. The budget resolution will come up during the second part of a two-day markup today in the Senate Budget Committee. The bill text:

D.C. CITY COUNCIL MEMBERS STEP INTO MERGER FIGHT: The proposed merger between Exelon Corp. and Pepco Holdings Inc. is really getting feisty. There have already been several editorials on both sides of the issue in Maryland and D.C., and Exelon has made efforts to sweeten its offer. But yesterday the D.C. Public Service Commission released a letter it received from three members of the D.C. City Council airing opposition to “any deal.” Councilwoman Mary Cheh, who chairs the body’s transportation and environment committee, and two colleagues, wrote that Pepco’s takeover by a large power plant-operating utility like Exelon could undermine competition and distributed generation, such as rooftop solar, in the region. Pepco essentially became a wires-only power distribution company after divesting from its power plants in 1999 and D.C. regulators need to consider “these non-monetary benefits.” Cheh adds, “Given these considerations …we have grave doubts that any deal approving this acquisition can be in the public interest.” The letter:

FERC and the states of Virginia, Delaware, and New Jersey have either signed off on the Exelon-Pepco merger or signaled their intention to do so, but D.C. and Maryland were always going to be the biggest climbs since they’re required to ensure that such deals be in the “public interest.” Maryland has put up a great deal of resistance but it’s gotten more complicated there recently. Earlier this month, the state’s Office of People’s Counsel and attorney general both ripped the potential merger. Yet, two days ago, Exelon announced that a settlement had been reached with Maryland’s Montgomery and Prince George’s counties. Those two counties represent all of Pepco’s Maryland customers and nearly three-fourths of Pepco Holdings’ total customer base in the state. The settlement agreement:

For those of you who can’t get enough of this debate, WAMU’s Kojo Nnamdi moderated a discussion on his show yesterday where the Maryland AG called in to press his points.

TODAY’S FERC MEETING: FERC kicks off its monthly meeting with an update on the state of its jurisdictional markets, and the commissioners will vote on several Order No. 1000 compliance filings. FERC will also take up a proposal from the North American Electric Reliability Corporation to revise rules regarding implementation of a risk-based registration program, a complaint from the Independent Power Producers of New York that “reliability must-run” contracts are preventing more expensive coal-fired power plants from going offline, and penalties proposed by NERC over reliability standard violations allegedly committed by NextEra. FERC HQ, 888 First St. NE. Webcast:

She’ll always be a Patriots fan: Today’s meeting is the last one where Cheryl LaFleur will wield the gavel — though she plans to serve out the rest of her term that runs into 2019 as a commissioner. On April 15, Norman Bay formally takes over as chairman, part of a confirmation deal that kept LaFleur atop the agency for nine more months. FERC’s monthly public meeting in April will be held the day after the handover, on April 16. Including her time as acting chairwoman, LaFleur will have led FERC for about a year and a half.

Hell no, they won’t go: ME also plans to keep an eye out for climate protestors at today’s meeting. Earlier this month, FERC put out an order clarifying that members of the public can observe meetings, but not disturb them. That order technically doesn’t go into effect until next month. It also may not do much to stop protestors who want FERC to take a more active role in combating climate change. The order didn’t contain any beefed-up penalties for protestors, who are typically escorted from the room.

THE NOT-SO-FAST AND THE FURIOUS: Oil industry trade groups filed a lawsuit against EPA yesterday, asking a district court to force EPA to “promptly” issue long-delayed Renewable Fuel Standard rules for 2014 and 2015. The rules, setting the volume of renewable fuels that must be blended into the nation’s gasoline supply every year, are due by law on Nov. 30 the year before they go into effect. That means the still-not-final 2014 rule should have been finished in 2013. Most recently, EPA officials have been saying the rules would be out this spring. The America Fuel and Petrochemical Manufacturers and the American Petroleum Institute lodged the suit with the D.C. District Court. The brief:

RFS BOOSTERS OFFER TO ROLL OUT CARPET FOR CRUZ: Eric Branstad, son of Iowa Gov. Terry Branstad and state director of the Renewable Fuel Standard-supporting America’s Renewable Future, wants Sen. Ted Cruz to feel the RFS love. ARF will provide experts for his campaign, take him on a tour of a biodiesel plant and invite him to RFS-themed events, if the Texas Republican is so inclined. “At the Iowa Ag Summit, you said the government should not pick winners and losers in energy policy. Though by eliminating the RFS, you would be picking a winner: Big Oil,” Branstad wrote to Cruz. The letter:


— Tar mat uncovered as BP report downplays oil spill impact. WWLTV Louisiana:

— Canada regulator probing TransCanada over safety allegations. CNBC:

— Exxon, Shell and others are pulling back from once-promising shale finds in Europe, Asia. The Wall Street Journal:
— Report: Oil and gas on public lands a ‘blind spot’ in climate fight. Fuel Fix:

— Solar-Energy Company Sunrun Preparing for Potential IPO. The Wall Street Journal:

— Feds: Oil leasing in Gulf slows due to oil price drop. The Associated Press:


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