The Senate Energy and Natural Resources Committee on Nov. 19 reported out the nominations of Dan Brouillette to head the Department of Energy and James Danly to fill a FERC vacancy.
The committee also reported out the nomination of Katharine MacGregor to be Interior Department deputy secretary, the No. 2 executive in the department.
"All three will excel in their new roles," Sen. Lisa Murkowski (R-Alaska), the committee chairman, said.
The votes to send the nominations to the Senate floor were 16-4 for Brouillette, 12-8 for Danly and 14-6 for MacGregor. Four committee Democrats voted against advancing Brouillette's nomination, including two Westerners, Catherine Cortez Masto of Nevada and Oregon's Ron Wyden.
On Danly's nomination, Sen. Joe Manchin (D-W.Va.), the committee's ranking Democrat, blasted the White House for not "pairing" two FERC nominations, including a Democrat for the seat vacated when Cheryl LaFleur left FERC at the end of August. Danly would fill the vacancy created when Kevin McIntyre died Jan. 2.
"What the White House has done or has not done is wrong," Manchin said. He added that the presumptive Democratic choice for the commission, Allison Clements, director of the Energy Foundation's clean-energy markets program, "has been villainized, that she is so far out of the mainstream, that she shouldn't be considered. That is wrong."
Manchin indicated he wouldn't oppose Danly's nomination because "I would be no better than they are if I did this."
The eight Democrats who voted against reporting out Danly's nomination included Westerners Wyden, Cortez Masto, Washington's Maria Cantwell and New Mexico's Martin Heinrich.
Under federal law, FERC cannot have more than three commissioners from one political party. Currently, there are two Republicans on FERC, Chairman Neil Chatterjee and Bernard McNamee, and one Democrat, Richard Glick.
Nuclear Waste, Pipeline Bills Advance
The House Energy and Commerce Committee on Nov. 20 waved through bipartisan legislation, HR 2699, that would authorize DOE to build and operate interim nuclear waste storage facilities.
The bill, sponsored by Rep. Jerry McNerney (D-Calif.), also would increase the storage cap for the proposed Yucca Mountain permanent waste repository from 70,000 to 110,000 metric tons. In addition, the bill would authorize DOE to build infrastructure to support Yucca Mountain before the NRC has decided whether to license the repository.
Rep. Frank Pallone (D-N.J.), committee chairman, said the bill "gets us closer to a real national solution for moving spent fuel to an interim facility and, ultimately, to a permanent repository."
HR 2699 would authorize payments to a state for hosting both interim and permanent repositories. A state would receive $400 million upon receipt of the first spent-fuel shipment to a permanent repository and $40 million annually until the repository is closed.
The committee reported out the legislation by voice vote.
On Nov. 19, the committee reported out a bill that would reinstate an EPA rule limiting pipeline methane emissions that the Trump administration unwound. Under the bill, the Transportation Department would be given one year to issue regulations requiring gas pipelines to capture methane released during routine operations, including venting to relieve pressure and blowdowns.
The committee advanced the bill on a 30-21 vote. Its prospects in the Republican-controlled Senate are uncertain.
Pallone said negotiations with panel Republicans on compromise bill language broke down. "This is a bold bill that is necessary to make our pipelines safe and secure," he said.
Rep. Greg Walden (R-Ore.), the panel's ranking Republican, accused committee Democrats of "political gamesmanship" on the bill.
The legislation also would direct the Transportation Department to issue rules for repairing cracks in pipelines located in urban and other "high-consequence areas," requiring gas pipeline operators to use advanced leak-detection technology, and mandating installation of remote automatic shut-off valves in high-consequence areas.
In addition, Pallone said the bill would repeal what he called "duplicative" cost-benefit analysis requirements for Pipeline and Hazardous Materials Safety Administration regulations.
Bill Extending Tax Preferences Floated
The House Ways and Means Committee floated legislation on Nov. 19 to extend tax preferences for energy efficiency and renewable resources, including a five-year reprieve for the expiring wind-energy production tax credit and the solar investment tax credit.
The bill also would revive credits for residential efficiency improvements and the commercial buildings efficiency deduction that expired in 2017.
Rep. Mike Thompson (D-Calif.), chairman of the House Ways and Means Committee's Select Revenue Measures Subcommittee, said in a statement that "this bill will build on existing tax incentives that promote renewable energy and increase energy efficiency and create new models for technology and activity to reduce our carbon footprint."
Tom Kiernan, CEO of the American Wind Energy Association, praised the bill's extension of the wind production tax credit until Jan. 1, 2025, at 60 percent of the authorized level of 2.3 cents/kWh. The credit, which for this year is at 40 percent of the authorized level, is due to expire Dec. 31.
Kiernan said the market has changed since Congress passed legislation in 2015 phasing out the credit. "National carbon policy hasn't materialized, and we have new tariffs significantly raising the cost of wind energy and U.S. manufacturing," he said in a statement.
Abigail Ross Hopper, CEO of the Solar Energy Industries Association, also praised the bill's five-year extension for the solar investment tax credit. The credit would be extended at 30 percent through 2024, then step down to 26 percent in 2025, 22 percent in 2026, and 10 percent thereafter.
Under current law, the credit steps down from 26 percent to 22 percent for projects beginning construction next year, then to 22 percent in 2021. After Jan. 1, 2022, under current law, the commercial credit drops down to 10 percent and the residential credit expires.
On Nov. 19, 26 House Democrats urged Speaker Nancy Pelosi (D-Calif.) to push through legislation extending the credit.
The bill also would revive the residential energy-efficiency credit, extend it to Dec. 31, 2024, and raise the credit from 10 percent to 15 percent. Likewise, the bill would revive the commercial energy-efficiency deduction, extend it to 2024, and increase the deduction from $1.80 to $3 per square foot.
The bill would make energy storage eligible for the investment tax credit on the same terms as solar. Eligible technologies include batteries with a minimum storage capacity of 20 kWh.
In addition, the legislation would authorize a $1,250 credit for purchase of a used plug-in electric vehicle.
Panel Moves Energy Bills to Senate Floor
The Senate Energy and Natural Resources Committee on Nov. 19 reported out a dozen energy bills, including legislation to advance solar, geothermal and nuclear research.
Bills receiving committee approval included:
- S. 2368, authorizing $40 million per year in fiscal years 2020 to 2024 for studies of advanced fuels for light-water reactors that demonstrate better performance, proliferation resistance and accident tolerance.
- S. 2556, directing FERC to study "incentive-based, including performance-based, rate treatments" for wholesale transmission and electricity sales that "could be used to encourage" utilities to invest in advanced cybersecurity technology and take part in cyber-information sharing programs.
- S. 2657, directing the Interior Department to update the U.S. Geological Survey geothermal resource assessment. In addition, the bill would direct the Energy Department to demonstrate relevant oil and gas technologies for geothermal development, award prizes for demonstrating co-production of geothermal energy and critical minerals, and open a second field site for testing enhanced geothermal production methods. The current site is near Milford, Utah.
- S. 2668, directing the Energy Department to carry out solar research, demonstration and commercialization of solar-energy technologies, including advanced thin-film photovoltaics and concentrated solar power, grid integration, manufacturing technologies, and forecasting and modeling. The bill also would direct DOE to support demonstration projects in collaboration with tribes and in economically distressed areas.
FERC Approves Return on Equity Revision
FERC approved a revised methodology on Nov. 21 for determining whether base return-on-equity portions of utility rates are just and reasonable under the Federal Power Act, a response to a 2017 federal appeals court decision.
FERC approved an order settling on the discounted cash-flow and capital-asset pricing models for determining utilities' costs of equity and deciding on replacement levels if a return on equity is found to be unjust and unreasonable. The models would be used to establish a "zone of reasonableness."
FERC's staff presentation said the two models would ensure that FERC's return-on-equity determinations "more accurately reflect how investors make their investment decisions, while also avoiding deficiencies in other models."
In a separate action, FERC applied the revised methodology in directing Midcontinent Independent System Operator transmission owners to cut their return on equity from 12.38 percent to 9.88 percent, effective Sept. 28, 2016, and ordering refunds.
Trump Signs Stopgap Budget Bill
President Donald Trump signed stopgap legislation on Nov. 21 extending federal agencies' spending authority until Dec. 20.
The legislation keeps agencies operating at fiscal year 2019 appropriations levels and avoids a shutdown. Trump acted after the Senate approved the legislation Nov. 21 on a 74-20 vote. The House passed the bill Nov. 19.
States Cross Swords Over Water Bill
Officials from two Western states took opposite tacks at a Nov. 19 Senate hearing on legislation to narrow states' project-permitting authority under the Clean Water Act.
Wyoming Gov. Mark Gordon called for passage of S. 1087, a bill restricting state review of infrastructure projects under the Clean Water Act to potential discharges into "navigable waters." The bill, introduced by Sen. John Barrasso (R-Wyo.), was the topic of a hearing before the Senate Environment and Public Works Committee, which Barrasso chairs.
Wyoming officials reacted angrily in 2017 when Washington state's Department of Ecology denied certification under the law's Section 401 to the proposed Millennium Bulk coal-export terminal in Longview.
Laura Watson, senior assistant attorney general for Washington, testified against the legislation and a proposed EPA rule that would give states a one-year deadline to decide on Section 401 certifications. Under the rule, if states miss the deadline, EPA could find they have waived their rights and issue federal permits.
In EPA's latest "unified regulatory agenda," the agency said a final rule would be issued by next May.
"I don't think one year is unreasonable," Gordon said. He added that Section 401 was "not intended to be a catch-all" for potential environmental impacts of energy infrastructure projects. The Trump administration and congressional Republicans have argued that states are using their Section 401 certification authority as a regulatory cudgel to block projects, which they have argued interferes with interstate commerce.
Opponents of the bill and the proposed EPA rule have argued it would strip states of their authority to protect their water resources. Sen. Jeff Merkley (D-Ore.) characterized them as "an assault on states' rights."
Watson said that under Barrasso's bill, other water-quality considerations would be "on the chopping block," including groundwater and species protections.
In her written testimony, Watson noted that Cowlitz County denied land-use permits for the proposed terminal.
"That the local government denied land-use permits independent of the state's decision means all the brouhaha over the 401 denial-from the project sponsors, EPA, the chairman of the committee-is much ado about nothing," she testified.
The Department of Ecology's denial of Millennium Bulk's certification application cited projected impacts on wetlands, proposed dredging of the Columbia River's bed, and projected air-quality impacts of trains bringing coal to ships.
States Step Up Tailpipe Standards Battle
Two dozen states stepped up their legal battle on Nov. 15 against the Trump administration's actions blocking California's authority to set tailpipe greenhouse gas emissions standards.
In the latest litigation, filed in the U.S. Court of Appeals for the D.C. Circuit, 24 states sued EPA to challenge its rule blocking California's tailpipe GHG standards and zero-emission vehicle mandates. California's standards are partly or wholly followed by 13 other states, an option they have under the Clean Air Act. Joining the states in the litigation were the District of Columbia and the cities of Los Angeles and New York.
The Trump administration's actions would undo the One National Program, a 2012 agreement between the federal and California governments to harmonize federal and state tailpipe GHG emissions standards and federal fuel-economy requirements.
States joining California in the latest lawsuit include Colorado, Nevada, New Mexico, Oregon and Washington.
The suit is a companion to litigation the same petitioners filed against the Transportation Department's National Highway Traffic Safety Administration. They sued in U.S. District Court for the District of Columbia to challenge NHTSA's pre-emption action under the 1975 Energy Policy and Conservation Act.
The Trump administration has argued that California's GHG standard is tantamount to a fuel-economy standard. Under the 1975 statute, the federal government holds sole authority to regulate motor-vehicle fuel economy.
FERC Recommends Jordan Cove Conditions
FERC staff on Nov. 15 recommended permit conditions for the proposed Jordan Cove liquefied natural gas terminal to mitigate unavoidable impacts on 18 species that are listed or proposed for inclusion on federal threatened and endangered species lists, as well as noise, housing, aviation and visual impacts.
The report recommended the conditions to a future commission authorization for the project in a final environmental impact statement covering the proposed terminal and associated 36-inch-diameter, 229-mile-long gas feeder pipeline. The terminal would have the capacity to liquefy up to 1.04 Bcf of gas per day for shipment to export markets.
The document agreed that Jordan Cove's proposal for protecting the terminal against earthquake-caused tsunamis would be "suitable," and the terminal could withstand a surge from a 500-year storm.
In connection with listed species, FERC has begun Endangered Species Act consultation with the U.S. Fish and Wildlife Service and National Marine Fisheries Service. The FEIS said construction could not begin on the terminal until consultations are completed.
The project's developer, the Jordan Cove Project, hailed the document's release, saying it signals "significant forward momentum."
Jordan Cove still faces regulatory hurdles. In May, Oregon's Department of Environmental Quality denied a water-quality certificate for the proposed project under the Clean Water Act's Section 410. The state's action left the door open for Jordan Cove to reapply for a certificate.
At a Nov. 19 hearing of the Senate Environment and Public Works Committee, Sen. Jeff Merkley (D-Ore.) noted the proposed feeder pipeline would cross nearly 500 bodies of water.
GAO Details Climate Threat to Superfund Sites
About 60 percent of hazardous-waste Superfund sites are at risk of impacts from wildfires, sea-level rise and flooding linked to climate change, the Government Accountability Office said in a report made public Nov. 18.
GAO said EPA should specify how its management plans would address potential climate-change impacts on the sites. EPA responded that it already plans for risks of contaminant exposure, but the report noted the agency "does not include any measures related to climate change or discuss strategies for addressing the impacts of climate-change effects."
The report was requested by Democrats on the Senate Environment and Public Works Committee; Rep. Betty McCollum (D-Minn.), chair of the House Appropriations Committee's Interior and Environment Subcommittee; and five additional senators, including Kamala Harris (D-Calif.) and Jeff Merkley (D-Ore.).
The report pinpointed 945 sites that are at risk of damaging impacts, including 234 with "high or very high wildfire hazard potential" according to U.S. Forest Service criteria.
One of the vulnerable sites the report called out was the Iron Mountain Mine site near Redding, Calif., which produced iron, copper, gold, silver, zinc and pyrite until it closed in 1963. In 2018, the Carr Fire burned through the site and nearly destroyed the system in place for treating acid mine drainage, the report said.
"Firefighters, using specialized equipment, successfully extinguished the fire before it reached the ore body in the mine, which could have led to an explosion and substantial environmental and health hazards," the report noted.
Geothermal Advantages Spotlighted
Geothermal resources potentially could supply energy anywhere in the U.S., replace coal for baseload generation, and serve as a source of critical minerals, scientists told a House subcommittee hearing Nov. 14.
Geothermal is under study for replacing output from the Boardman coal plant in Oregon, due for shutdown in 2020, according to testimony from Maria Richards, director of the Geothermal Research Laboratory at Southern Methodist University. Richards spoke at a hearing of the House Science, Space and Technology Committee's Energy Subcommittee that explored geothermal and marine energy development.
According to the Seattle-based Hotrock Energy Research Organization, a nonprofit, the area near Boardman reaches the high temperature of 200 degrees Celsius at around 5 km depth, which is easily reachable with current drilling technology, and has a "stress regime" favorable for creating an enhanced geothermal resource.
Richards also said geothermal fluids are a potential source of critical minerals such as lithium. A Commerce Department report released earlier this year called for studies to develop technologies for extracting critical minerals from geothermal brines. A DOE-funded study at California's Salton Sea in 2016 found that lithium can be extracted from brines with ion-imprinted polymers.
Joseph Moore, manager of the Frontier Observatory for Research in Geothermal Energy in Utah, said granitic rock suitable for creating enhanced geothermal resources is found across the U.S. "I could suggest we could drill here to find conditions that are similar," he told the subcommittee.
In other testimony, Bryson Robertson, head of the Pacific Marine Energy Center at Oregon State University, called for passage of legislation, HR 3203, to authorize $150 million per year in fiscal years 2020 and 2021 for marine-energy research. The bill is co-sponsored by Rep. Suzanne Bonamici (D-Ore.).
A companion Senate bill, S. 1821, was reported out of the Energy and Natural Resources Committee on Sept. 25, including authorized 2020 and 2021 appropriations of $160 million per year.