The federal pipeline safety agency on Feb. 6 proposed requiring installation of remote-controlled or automatic shut-off valves on new and replacement gas and hazardous-liquids pipelines over 6 inches in diameter.
The Pipeline and Hazardous Materials Safety Administration proposed allowing installation of manual valves in places where auto shut-off is not "economically, technically or operationally feasible." Pipeline operators, however, would have to station personnel able to close the valves within 40 minutes of detecting a rupture, the same deadline the rule would set for automatic or remote-controlled valve shut-offs.
Congress in 2011 passed legislation requiring PHMSA to mandate shut-off valves on new and replacement pipelines. The law was enacted in the aftermath of the September 2010 natural gas pipeline explosion in San Bruno, California.
The proposed rule also would set standards for identifying pipeline ruptures, initiating pipeline shutdowns and isolating ruptured segments.
The proposal would require pipeline operators to notify public-safety agencies immediately after identifying a rupture. The proposal noted that in the case of the San Bruno accident, 95 minutes elapsed before Pacific Gas & Electric stopped the gas flow and isolated the break.
"The use of [automatic shut-off valves] or [remote-controlled valves] would have reduced the amount of time taken to stop the flow of gas and would have shortened the time the site was inaccessible to emergency responders," the proposal said.
PHMSA opened a 60-day public comment period on the proposal. Comments are due by April 6.
BLM OKs Plan for Lands Cut From Monuments
The Bureau of Land Management on Feb. 6 finalized a management plan for lands President Donald Trump removed from the Grand Staircase-Escalante National Monument in Utah.
The action opens approximately 650,000 acres of the removed lands, dubbed the Kanab-Escalante Planning Area, to fossil-energy and mineral leases with varying levels of development restrictions. The planning area totals 861,974 acres.
BLM also finalized management plans for the shrunken Grand Staircase-Escalante and Bears Ears national monuments, which Trump downsized in 2017. His action has been challenged in court.
The final plan makes 632,000 acres of the removed Grand Staircase lands available for utility-scale wind-energy projects. In addition, the plan said the "development potential of coal resources will be determined based on site-specific analyses" on approximately 592,000 acres. The plan closes 75,076 acres to surface coal mining.
The Kaiparowits Plateau in southeastern Utah holds an estimated 11.4 billion tons of recoverable coal, according to the Utah Geological Survey.
BLM's action was praised by Utah federal, state and local officials and denounced by environmental organizations.
"These management plans are the result of meaningful collaboration that was clearly lacking in the politically motivated monument designations by past administrations," Rep. Rob Bishop (R-Utah), ranking Republican on the House Natural Resources Committee, said.
Utah Gov. Gary Herbert said monuments designated under the 1906 Antiquities Act "should not be created over the objections of local communities."
"These plans are atrocious and entirely predictable," Sharon Buccino, senior lands director for the Natural Resources Defense Council, said.
Trump's removal of lands from the two monuments is under court challenge by environmental organizations and five tribes, which argue he lacked authority under the Antiquities Act to shrink the monuments.
Rep. Raúl Grijalva (D-Ariz.), chairman of the House Natural Resources Committee, predicted "the courts are going to overturn" Trump's reduction of the monuments. "Anyone who invests a dollar in drilling or digging in the newly opened areas should be prepared to lose their bet against public opinion and the strength of our legal system," Grijalva said in a statement.
Trump's proclamation reduced the size of Bears Ears from 1.35 million acres to 201,876 acres and split the monument into two units. In a similar proclamation, Grand Staircase-Escalante's size was cut from 1.72 million acres to slightly more than 1 million acres, and the monument was reorganized into three units.
Trump Tweets Opposition to Yucca Mountain
Trump appeared to indicate on Feb. 6 he opposes the proposed Yucca Mountain nuclear waste repository, an apparent reversal in the administration's support for licensing the only candidate site under federal law for disposing of spent fuel from nuclear power plants.
"Nevada, I hear you on Yucca Mountain and my Administration will RESPECT you!" Trump said in a Twitter post. "Congress and previous Administrations have long failed to find lasting solutions—my Administration is committed to exploring innovative approaches—I'm confident we can get it done!"
Yucca Mountain is opposed by federal and state officials in Nevada, a state with six electoral votes in the Nov. 3 presidential election.
In a response tweet, Sen. Catherine Cortez Masto (D-Nev.) said to Trump, "I look forward to working with you on this critical issue for Nevada and ensuring your budget doesn't include any funding to restart the failed Yucca Mountain project that a majority of Nevadans reject, regardless of party."
Rep. Dina Titus (D-Nev.), however, indicated she placed little stock in Trump's statement. In a tweet, Titus said, "Trump broke the promise he made when he said in Elko that he would respect our state's opposition to Yucca Mountain. I have no reason to trust him this time around."
The Trump administration's budget requests have included funding for licensing the proposed repository. The fiscal year 2020 request included $116 million for Yucca Mountain and interim storage.
Congress did not appropriate funding for the project in FY 2020 appropriations legislation.
Pipeline Policy Reforms Backed
A former FERC commissioner and the American Public Gas Association on Feb. 5 pressed for Natural Gas Act changes that would give FERC authority to set a "refund date" providing for repayment of transmission service overcharges by interstate gas pipelines.
At a hearing of the House Energy and Commerce Committee's Energy Subcommittee, former FERC Commissioner Cheryl LaFleur and other witnesses also said FERC should carry out broader need assessments and environmental impact analyses, including climate impacts, for proposed interstate pipelines.
"It has been too long since this committee explored pricing and what consumers pay for natural gas," Rep. Frank Pallone (D-N.J.), chairman of the full committee, said.
Bipartisan legislation was introduced Jan. 30 to amend the Natural Gas Act to authorize FERC to order pipelines to pay refunds for overcharging customers. The bill was introduced by Reps. G.K. Butterfield (D-N.C.) and Billy Long (R-Mo.).
Republican lawmakers and a pipeline executive raised concerns, however, that revising the law could lead to reduced pipeline investment.
"FERC has done a good job carrying out its responsibilities" under the law, Rep. Greg Walden (R-Ore.), the full committee's ranking Republican, said.
Michael McMahon, senior vice president of Boardwalk Pipelines LP, said on behalf of the Interstate Natural Gas Association of America that amending the law would "disrupt the rate stability" he said the statute provides. McMahon said the gas transmission market is competitive, noting that customers "have the ability to connect to multiple pipelines" to transport gas they have purchased.
However, Rich Worsinger, director of energy utilities for the City of Wilson, North Carolina, testifying for the American Public Gas Association, said 95 percent of publicly owned distribution gas utilities are "captive" to single pipelines.
LaFleur, who left FERC last year, said that under the Federal Power Act, the commission has authority to set "refund dates" for rate cases filed by power wholesalers and customers under sections 205 and 206. Once FERC rules on a case, the refund date starts the clock for when wholesalers must pay refunds if they have overcharged or when customers must pay more if FERC approves a rate increase.
In contrast, LaFleur testified, the Natural Gas Act does not authorize refund dates for similar filings by interstate pipelines or their customers, meaning that if FERC finds a pipeline's rates are not just and reasonable, rates are not lowered until the end of the rate proceeding.
Consequently, Worsinger testified, gas customers "do not receive full refund protection from overcharging transmission pipelines."
LaFleur said that when Congress lowered corporate tax rates in the 2017 tax legislation, the commission was forced to use a process that lasted more than a year to secure rate reductions for pipeline customers.
"Had there been the refund authority, I think FERC could have much more promptly delivered these savings to customers," LaFleur said in response to questions from Rep. Jerry McNerney (D-Calif.).
On need assessments, Susan Tierney, senior adviser to the Analysis Group consulting firm and former Energy Department assistant secretary for policy, said FERC relies too heavily on "precedent agreements," in which buyers indicate intent to buy transmission services from a proposed pipeline.
"If there's a precedent agreement in place, FERC in effect checks the box that the project is needed," Tierney said of FERC's pipeline certification process.
Instead, Tierney testified that in view of changes in energy markets, including growth of renewables, FERC should be required to examine a broader range of issues when determining whether a proposed pipeline is needed, including potential adverse economic effects, unmitigated environmental impacts, and whether there is underutilized pipeline capacity nearby. She said FERC's environmental analyses of proposed pipelines don't adequately consider no-action alternatives.
LaFleur said that when she sat on FERC, she disagreed with other commissioners on interpreting a 2017 court ruling that required disclosure of pipelines' estimated downstream climate impacts.
"I believed the majority did not properly disclose or consider the significance of climate impacts," she said in written testimony.
Court Rejects Speedup of Tailpipe Case
A federal appeals court on Feb. 4 rejected the Trump administration's request to speed up consideration of litigation challenging its revocation of California's authority to set tailpipe greenhouse gas emissions standards.
A three-judge panel of the U.S. Court of Appeals for the D.C. Circuit ruled the administration failed to make "strongly compelling" arguments for expediting the case.
California and 22 other states, along with the cities of Los Angeles and New York and the District of Columbia, sued the Environmental Protection Agency to challenge the revocation.
DOE Spending Pace Draws Lawmakers' Fire
House Democrats on Feb. 5 said the Department of Energy is dragging its feet spending funds appropriated for energy-efficiency and renewables research, pointing to $823 million in fiscal year 2019 revenues carried over into the current fiscal year.
Rep. Bill Foster (D-Ill.), chairman of the House Science, Space, and Technology Committee's Investigations and Oversight Subcommittee, suggested that the Trump administration is seeking to undermine efficiency and renewables research.
"When we want something funded at a certain level, we expect that to be executed in good faith," Foster said at a hearing of his subcommittee and the Energy Subcommittee. "It's unclear to many of us that there has been a good particularly good-faith effort."
The administration's FY 2020 budget request called for slashing funds for DOE's Office of Energy Efficiency and Renewable Energy by 86 percent, to $343 million. Congress, however, increased the office's funding by $411 million, to $2.79 billion, in FY 2020 budget legislation, which Trump signed into law on Dec. 20.
Daniel Simmons, DOE's assistant secretary heading the efficiency and renewables office, denied that the administration is slow-walking funding of research projects. He said the reason for the carryover is that "it takes a while to go through the entire [funding opportunity announcement] process."
Simmons added that large carryovers are common, pointing out that in FY 2016, during the Obama administration, "they carried over 37 percent" to FY 2017.
"We're trying to be good stewards of taxpayers' dollars. When Congress does not appropriate final-year appropriations till later in the fiscal year, it takes a while to get those funding announcements out the door, and it takes at least nine months before we can make [research project] selections."
Trump Speech Touches Briefly on Energy
Trump's State of the Union speech on Feb. 4 touched briefly on energy, with the chief executive boasting that "America is now energy independent" and that "energy jobs, like so many elements of our country, are at a record high."
"Thanks to our bold regulatory reduction campaign, the United States has become the number one producer of oil and natural gas in the world," Trump said.
According to the Energy Information Administration, the U.S. has been the world's top gas producer since 2011. The U.S. passed Saudi Arabia as the world's top petroleum producer in 2018.
EIA figures released Feb. 6 show that the U.S. is a net importer of crude oil and a net exporter of petroleum products.
Trump did not mention climate change but noted the U.S. would join the One Trillion Trees Initiative, proposed by Salesforce CEO Marc Benioff at the Davos forum last month. The initiative's goal is to plant 1 trillion trees worldwide by 2030.
At the speech, congressional Democrats wore "warming stripes" pins illustrating the rise in global temperatures.
"Without a doubt, what we won't hear from President Trump in his State of the Union address tonight is any plan for this administration to comprehensively address climate change, the greatest threat to our planet," Sen. Tom Carper (D-Del.), ranking Democrat on the Senate Environment and Public Works Committee, said in advance of the speech.
Interior Secretary David Bernhardt did not attend the speech, which Trump delivered in the Capitol's House chamber. Bernhardt was the "designated survivor" to step in as president if a catastrophe had struck the Capitol while Trump, Vice President Mike Pence, congressional leaders, and other Cabinet officials in the presidential line of succession were inside for the speech.
Senators Urge Banks Not to Fund Arctic Drilling
Sixteen Senate Democrats on Feb. 3 urged top U.S. banks to steer clear of financing oil and natural gas drilling in the Arctic National Wildlife Refuge.
"The scale of your banks' assets individually, let alone together, give you the ability to drive change in protecting the Arctic National Wildlife Refuge and in shifting towards a U.S. financial sector that effectively analyzes and plans for climate risks," the senators said in a letter to 11 top financial institutions.
The senators sent the letter to JPMorgan Chase, Bank of America, Citigroup, Wells Fargo, Morgan Stanley, U.S. Bancorp, PNC Financial Services Group, TD Bank, Capital One, Citizens Financial Group and HSBC North America Holdings.
Senators signing the letter included New Mexico's Martin Heinrich and Tom Udall, Oregon's Jeff Merkley, California's Dianne Feinstein and Kamala Harris, and Michael Bennet of Colorado.
Goldman Sachs on Dec. 15 announced it would not finance oil and gas drilling in the refuge's coastal plain.
The Interior Department on Sept. 12 released a final plan for leasing the ANWR coastal plain for oil and gas exploration and production. In 2017 tax legislation, Congress directed the Interior Department to hold at least two lease sales of at least 400,000 acres each by Dec. 22, 2024.
FERC to Speed Pipeline Dispute Rehearings
FERC Chairman Neil Chatterjee on Jan. 31 announced an office reorganization aimed at speeding landowners' requests for rehearings of commission-issued pipeline certificates.
Chatterjee ordered establishment of a rehearings section inside FERC's Office of General Counsel, including a landowner rehearings group.
"We are hopeful that these actions will help alleviate the very real landowner concerns about timing and fairness in infrastructure cases implicating landowner rights," Chatterjee said.
Rep. Frank Pallone (D-N.J.), chairman of the House Energy and Commerce Committee and a critic of FERC's pipeline siting decisions, said Feb. 5 that Chatterjee's decision "sounds good, but we'll have to see if FERC is really getting the message." Pallone spoke at a hearing that the panel's Energy Subcommittee held on revising the Natural Gas Act (see story above).
FERC Seeks Comments on Performance Metrics
FERC filed a Federal Register notice on Jan. 30 asking for public comment on 29 proposed performance metrics to be collected voluntarily from regional transmission organizations and independent system operators, as well as from utilities that perform identical functions.
Comments are due March 2. FERC's action follows up on a data-collection proposal released last July.
In the Jan. 30 notice, FERC proposed collecting three sets of data. The first set, to be collected from organized markets and utilities that submitted performance metrics in 2015, would cover operational data such as reserve margins, heat rates, capacity factors and fuel diversity. The second set, to be collected from the six organized markets running energy markets, would include pricing, revenue and demand-response data, while the third set would collect data from the four RTOs/ISOs that run capacity markets, including information on costs, deliverability and performance.
FERC rejected requests by the American Public Power Association for expanded metrics, including transmission cost data, capacity-resource cost recovery, market concentration and financial-entity profitability. The California ISO's proposed metric on congestion revenue right auction efficiency also was turned down by the commission.
FERC Holding Reliability Conference June 25
FERC will hold a technical conference June 25 on the reliability of the bulk power system, focusing on the changing resource mix, impacts of solar, wind and other inverter-based and inverter-connected distributed generation, and cybersecurity.
NERC in 2018 released guidelines recommending performance specifications for inverter-based and connected resources.
The meeting, to be held at FERC's Washington, D.C. offices, will be open to the public and will be webcast.
Doubts Raised About China LNG Promise
China's trade-deal commitment to buy $52.4 billion worth of U.S. energy products won't necessarily result in increased Chinese purchases of liquefied natural gas from the U.S. in the immediate future, a Jan. 30 Morningstar research brief said.
"Trade treaty or no, it's difficult to envision short-term growth in U.S. exports to China this year," the report said, citing continued Chinese tariffs of 25 percent on U.S. LNG, competition from Australian gas producers, falling Asian prices "that suggest oversupply," and impacts of the coronavirus outbreak on Chinese demand.
Under the agreement, China agreed to buy "no less than $18.5 billion above the 2017 baseline amount" in 2020, but Chinese Vice Premier Liu He said imports of U.S. gas would be driven by market demand, Morningstar said. In addition, the report notes, the agreement does not specify penalties for noncompliance.
China last purchased U.S. LNG in February 2019, when 3.46 Bcf was shipped. Since then, U.S. exports of LNG to China have fallen to zero, according to the Energy Information Administration.
DOE Inks Cyber Info-Sharing Initiative
Three Cabinet departments on Feb. 3 agreed to strengthen sharing of information for defending critical infrastructure against cybersecurity threats.
The Energy, Defense and Homeland Security departments signed a "pathfinder" memorandum of understanding aimed at better understanding cyberthreats to energy infrastructure "and to respond effectively should those threats materialize," Karen Evans, DOE's assistant secretary for cybersecurity, energy security and emergency response, said.