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Granholm asked about the loss of fossil fuel jobs in Senate confirmation hearing

U.S. Energy Secretary nominee Jennifer Granholm talked up the potential of creating millions of U.S. jobs as part of an effort to develop clean energy and emissions-reducing technologies as she faced stiff questioning during her Jan. 27 confirmation hearing from Republican senators concerned about a near-term hit to fossil fuel-related employment.

Drawing on her experience helping spur clean energy technology job growth as a former governor of Michigan, Granholm stressed plans to create "economic clusters" of technology-led growth and manufacturing in states hard hit by the energy transition.

"The products that reduce carbon emissions are going to create a $23 trillion global market by 2030. So we can buy electric car batteries from Asia, or we can make them in America," Granholm said. She later asserted that requiring states to act on their own to create those kinds of jobs is like "bringing a knife to a gunfight" with international competitors.

Senators representing fossil fuel-producing states expressed concern that the Biden administration's efforts to nix permits for the Keystone XL crude oil pipeline, halt new leasing for oil and gas drilling on federal lands, and transform the energy sector will threaten jobs in fossil fuel-producing areas.

"The last Democratic administration went on a regulatory rampage to slow or stop energy production," said Sen. John Barrasso, R-Wyo., the committee's incoming ranking member. "I'm not going to sit idly by ... if the Biden administration enforces policies that threaten Wyoming's economy or the lifeblood of so many people in my home state."

Pivot to emissions reductions

Pressed about her 2016 comment that the U.S. should do everything possible to keep fossil fuel energy in the ground, Granholm left room for those resources to be included in the nation's energy mix, albeit with advances.

"I think it is important that as we develop fossil fuels that we also develop the technology to reduce greenhouse gas emissions," Granholm said. The U.S. should be energy secure "in the cleanest way possible," Granholm added when asked about energy security and independence.

DOE research and development on carbon management and reduction technologies like carbon capture utilization and storage, hydrogen, and direct air capture is important to achieve net-zero carbon emissions by 2050, Granholm added.

Incoming Committee Chairman Joe Manchin, D-W.Va., asked Granholm for commitments to help "heavy lifters," meaning fuel-producing states where people feel left behind by market changes.

"This is the most important question because we know that this transition is happening, and we cannot leave our people behind," Granholm said. She spoke of opportunities to take technology, like blue hydrogen derived from natural gas, to scale, with such states specializing in technologies that reduce emissions and otherwise diversifying.

"These place-based solutions to be able to take advantage of the expertise and comparative advantages of states and build on that to allow them to diversify inside and outside their main industries is a partnership that we could have through the Department of Energy," she said.

Asked about job impacts of the administration's just-announced hold on new leasing on federal lands, Granholm offered that the halt is "prospective" and would not cost jobs related to existing leases, such as 12 million offshore acres currently under lease, not all of which is utilized.

"It gives us time to be able to work on technologies that reduce GHG emissions and keep people employed," she said.

LNG prospects

Granholm offered a few words on LNG, a fuel discussed little by the Biden campaign. Asked if LNG exports served US geopolitical interests, Granholm agreed, while offering the example of "smaller exports" to island countries where the fuel might displace coal or diesel-fired generation and thus lower emissions.

"I would also want to work with natural gas providers to see if we could reduce natural gas emissions at the point of production," she added.

Sen. Mike Lee, R-Utah, asked how climate change considerations might be factored into the DOE's LNG export decisions. Granholm offered few specifics in response, saying she would abide by the Natural Gas Act and other requirements.

Elsewhere, Granholm pivoted toward the need for electric transmission when asked about the importance of accessing energy on federal lands. She said she was eager to work with the Federal Energy Regulatory Commission to get needed new transmission lines built as soon as possible, such as to help connect wind energy-producing areas with load centers. "This is a very high priority to make that happen," she said.

Despite the tough questioning, Barrasso concluded by saying he looked forward to working with Granholm, should she be confirmed. Manchin was outspoken in his support for the nominee.

Committee action was expected in the coming days, prior to the Senate moving on to former President Donald Trump's impeachment trial, according to a congressional aide.

Maya Weber is a reporter with S&P Global Platts. S&P Global Market Intelligence and S&P Global Platts are owned by S&P Global Inc.