U.S. energy policy is on hold for now, but several top-tier energy issues will be front and center when the House and Senate return to Capitol Hill after the August recess, according to Frank Maisano, senior principal in law firm Bracewell Giuliani’s Government Relations and Strategic Communications Practice. Energy watchers should be on the lookout for the following issues, Maisano said in the most recent of his regular updates on energy issues and events in and around Washington.
President Obama’s comments on the pipeline’s potential carbon footprint and its marginal positive impact on U.S. employment, followed by a State Department Inspector General inquiry into a potential conflict of interest targeting a contractor hired to assess its environmental impacts, have deflated optimism about the project’s future. No one (sane) wants to spill oil all over the Badlands. But if you accept the proposition that the U.S. is going to continue importing oil for the foreseeable future (as many well-informed people in energy do), it’s worth considering that it would be tough to find a friendlier or more environmentally conscious supplier than Canada. And shipping by rail has its own risks.
Power Plant Emissions
President Obama set a September 20 deadline for an emissions-control proposal for new power plants in the June speech that introduced his Climate Action Plan. Maisano sees that timeline as rather ambitious, perhaps intentionally so. The proposal, which would have significant implications for coal plants in particular, has prompted accusations that the Obama administration is waging a “war on coal."
“We will likely see a renewed focus on offshore drilling in light of recent events in the Gulf of Mexico,” Maisano writes. We take “recent events” to mean a fire at an offshore Gulf of Mexico gas well that began on July 23 and burned out on July 25, and perhaps the oil spill caused by the explosion of the Deepwater Horizon rig at BP’s Macondo well in 2010. Expect a focus on safety.
Renewable Fuel Standard
The Renewable Fuel Standard remains the subject of fierce debate, although the EPA release of the finalized 2013 Renewable Fuel Standard has relieved some of the pressure to satisfy renewable volume requirements that were unattainable under current market conditions, and offered some flexibility on the timing of compliance. Many in industry are calling on Congress either to amend or do away with what Columbia University’s Jason Bordoff called an “outdated RFS.” Industry groups of all stripes appear to welcome the EPA’s flexibility, but renewables advocates will likely seek to maximize mandated volumes.
FERC Chairman Nominee
Ron Binz, who received pretty harsh treatment in a July 29 Wall Street Journal editorial, is President Obama’s nominee for FERC Chairman. Binz has a reputation for being anti-coal, and apparently he once referred to natural gas is a “dead-end” resource. We weren’t there to hear those remarks, so we don’t have a sense of context, but being anti-natural gas would, in theory, put him at odds with reported comments from Energy Secretary Ernest Moniz and the president’s "all-of-the-above" energy strategy.
“While normally this issue is a sleeper, and will likely to continue to be, don’t be surprised to see lots of mindless discussion about it and how we need to take political action right away,” writes Maisano. Discussion on climate change, especially on Capitol Hill, does often stray into tinfoil-hat territory. But many climate scientists (also known as people whose job it is to understand climate change and its potential impacts on the planet and its inhabitants) and others seem to see it as a pressing issue, and one worth raising sooner rather than later in a policy context.