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Washington Week: FERC to issue long-awaited PJM capacity market order

The Federal Energy Regulatory Commission is expected to issue a pivotal decision soon on the PJM Interconnection's capacity market rules that could have major implications for clean energy development in the 13-state power market.

FERC will hold its next monthly open meeting Dec. 19. The meeting agenda includes FERC dockets EL16-49 and EL18-178, which pertain to a proposal PJM submitted in October 2018 to address the impact of subsidized energy resources on the mid-Atlantic grid operator's capacity markets.

The proposed new rules would prevent most subsidized resources, such as nuclear plants receiving state-issued zero-emission credits, from factoring the cost savings of those subsidies into their PJM capacity market bids. The tariff changes are aimed at creating a more level playing field among capacity resources, but critics have said PJM's proposal would inhibit state efforts to encourage generation from cleaner energy sources.

At the Dec. 19 meeting, FERC will also address several pending applications for natural gas pipeline projects. Those projects include an expansion of Eastern Shore Natural Gas Co.'s pipeline system in Delaware and Maryland (FERC docket CP18-548) and Dominion Energy Transmission Inc.'s application to build a pipeline expansion project to serve a new gas-fired power plant in eastern Ohio (FERC docket CP19-26).

Congress to tackle end-of-year bills

The U.S. Congress is set to adjourn for the year Dec. 20 and will take up several major pieces of legislation containing energy provisions before doing so.

Those bills include a bicameral conference report on the National Defense Authorization Act of 2019. The defense spending bill includes the Protecting Europe's Energy Security Act, which would impose sanctions on companies and vessels that help install deep-sea pipelines for Russia's Nord Stream 2 gas project. But the conference report excluded the Utilizing Significant Emissions with Innovative Technologies Act, or USE IT Act, which encourages the commercial use of carbon capture technology.

The U.S. Senate included the USE IT Act in its version of the National Defense Authorization Act bill, but the U.S. House of Representatives did not, resulting in the legislation's exclusion from the final conference report.

Before Dec. 20, Congress must also pass a spending measure to avoid a shutdown for government agencies including the U.S. Department of Energy and Environmental Protection Agency. The House will also be consumed with a resolution to impeach U.S. President Donald Trump over "high crimes and misdemeanors" tied to alleged pressure on Ukraine to investigate former Vice President Joe Biden, Trump's rival in the 2020 presidential race.

Hearing set on wildfire grid impacts

Amid the busy week, the Senate Committee on Energy and Natural Resources will hold a Dec. 19 hearing on how wildfires afflicting parts of the U.S. are affecting grid resilience and reliability.

As of Dec. 13, the committee had not announced witnesses for the hearing, which comes as PG&E Corp. struggles with the fallout of devastating wildfires in California that have prompted the company to conduct unpopular precautionary blackouts.

US, China reach phase-one trade deal

On Dec. 13, the U.S. and China said they agreed to a phase-one deal to ease an ongoing trade war between the two countries.

Among other things, the agreement canceled scheduled U.S. tariffs on Chinese goods that were slated to go into effect Dec. 15. Trump also said negotiations on a "phase two deal" would begin "immediately," and China has agreed to large purchases of agricultural products, energy and manufactured goods. But Beijing has historically not followed through on such claimed commitments.

COP climate conference winds down

The 25th annual session of the Conference of the Parties, or COP25, wrapped up Dec. 15 without participating countries reaching an agreement on how to account for carbon reductions and markets under the Paris Agreement on climate change.

Scientists have indicated that the world will need to act quickly to curb annual greenhouse gas emissions levels by 2030 and achieve net-zero emissions by 2050 to achieve that goal. But global emissions have continued to climb, and reports have indicated that current ambitions of countries fall far short of the target.

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US Congress
Dec. 17

The Senate Committee on Energy and Natural Resources will examine the nomination of Lanny Erdos to be director of the U.S. Office of Surface Mining Reclamation and Enforcement.

Dec. 19

The Senate Committee on Energy and Natural Resources will hold a hearing on the impact of wildfires on electric grid reliability and efforts to mitigate wildfire risk and increase grid resilience.

Dec. 19

The House Committee on Oversight and Reform's Subcommittee on Environment will hold the fourth in a series of hearings on climate change, this one titled "Current Economic Effects of Climate Change and the Costs of Inaction."

Federal agencies
Dec. 19

The Federal Energy Regulatory Commission will hold its monthly open meeting at FERC's headquarters in Washington, D.C.

Industry events

Dec. 16

The Brookings Institution's Asia Transnational Threats Forum will host an event in Washington, D.C., on how climate change will affect governance, the economy and human security in Asia.

Dec. 18

The Information Technology & Innovation Foundation will host an event in Washington, D.C., on using tax incentives to drive clean energy innovation. Speakers will include U.S. Rep. Tom Reed, R-N.Y.

Dec. 19

The North American Electric Reliability Corp. will hold a webinar on its 2019 Long-Term Reliability Assessment.

Notable stories from last week

US regulated utilities want energy storage tax credit proposal to go further

New energy secretary slams 'bad actors' for delaying pipeline projects

USMCA deal to keep tariffs off North American oil, gas trade

Big energy bill, confirmation of FERC nominee not likely until 2020

As gas bans proliferate, 114 Calif. governments pass energy choice resolutions

EU commits to climate neutrality despite pushback from Poland