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Washington Week: Industry awaits final Clean Power Plan hearing, tariff relief

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Washington Week: Industry awaits final Clean Power Plan hearing, tariff relief

In a slow preholiday week, the U.S. Environmental Protection Agency will hold the last public hearing on its proposed repeal of the Clean Power Plan, while energy producers hope for more relief from the White House's newly enacted tariffs on steel and aluminum imports.

On March 27, the EPA will host a public listening session in Gillette, Wyo., on its proposal to undo the Clean Power Plan — an Obama-era regulation aimed at reducing emissions of carbon dioxide from existing fossil fuel-fired power plants. The rule, which the U.S. Supreme Court put on hold in February 2016, would require states to meet individual carbon emissions rate limits that the EPA previously estimated would cut the power sector's carbon output 32% from 2005 levels by 2030.

Coal producers and over half of U.S. states opposed the Clean Power Plan, making the regulation a key target for repeal by the Trump administration. But many electric utilities, including some that are heavily reliant on coal, still want the EPA to form some sort of replacement regulation in order to have more regulatory certainty and stave off possible citizen lawsuits related to climate change.

The comment period on the Clean Power Plan repeal ends April 26. A separate comment period on a possible replacement rule ended Feb. 26.

Tariff tremors

Fears of a trade war mounted after President Donald Trump on March 22 announced that the U.S. will impose tariffs on up to $60 billion of imports from China. China quickly responded by saying it would impose tariffs on 128 U.S. products in a move that is expected to affect $3 billion in U.S. exports.

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President Donald Trump prepares to sign a memorandum imposing tariffs and investment restrictions on China at the White House on March 22.
Source: Associated Press

The announcement is the latest in a string of trade actions the White House has taken in a bid to bolster the competitiveness of U.S. manufacturers. Those actions include tariffs on steel and aluminum imports and a duty on imports of certain solar cells and panels.

Oil and gas producers and LNG terminal developers fear the steel tariffs could raise their costs and lead to retaliatory measures at a time when the U.S. is working to expand its crude and gas exports. Several countries that supply the bulk of the U.S. pipeline industry's imports have managed to secure temporary exemptions from Trump's steel and aluminum tariffs, but oil and gas industry groups want more.

"We hope that these exemptions ... are permanent, as specialty steel products for U.S. interstate natural gas pipeline projects are manufactured in several of these nations," said Martin Edwards, vice president of the Interstate Natural Gas Association of America.

On March 22, U.S. Trade Representative Robert Lighthizer said the European Union, Australia, Argentina, Brazil and South Korea will not be subject to the steel and aluminum tariffs while he negotiates with those countries. The U.S. also granted temporary exemptions to Canada and Mexico while the three countries work to update the North American Free Trade Agreement.

FERC suffers cyber breach

On March 23, the U.S. Department of Justice charged nine Iranians with conducting a "massive cyber theft campaign" against U.S. universities, companies and government agencies, including the Federal Energy Regulatory Commission. U.S. Attorney Geoffrey Berman called the cyber intrusions "one of the largest state-sponsored hacking campaigns" the Justice Department has ever prosecuted.

The charges highlight the growing threat cyber attackers pose to the U.S. energy sector and came shortly after the U.S. Department of Homeland Security blamed the Russian government for a two-year cyberattack campaign against U.S. computer networks and industrial control systems, including for the electric grid and nuclear power plants.

The U.S. Department of Energy has requested more funding for its cybersecurity efforts and received praise from industry groups for the DOE's formation of a new office focused on cybersecurity and emergency response. But some lawmakers on Capitol Hill, including Senate Energy and Natural Resources Committee Ranking Member Maria Cantwell, D-Wash., say the agency must do more to protect the power sector from possible attacks.

Congress on recess

The U.S. Congress went on recess ahead of the Passover and Easter holidays after approving a $1.3 trillion spending bill for the rest of the 2018 fiscal year. Trump signed the legislation into law March 23 only hours after indicating he might veto the measure.

The legislation rejected calls from the Trump administration to slash funding for the EPA and raised or maintained spending on DOE research efforts that the White House proposed to cut or eliminate. The bill further excluded Trump's request to sell the transmission assets of three federal power marketing administrations.

Utilities also scored a win from the bill, which included provisions to ease management of vegetation around power lines on public lands.

The U.S. Senate will reconvene April 9 and could vote soon thereafter on whether to confirm Trump's pick for the number two spot at the EPA. In the early morning hours of March 23, Senate Majority Leader Mitch McConnell invoked cloture on Andrew Wheeler's nomination as EPA deputy administrator.

Wheeler co-leads Faegre Baker Daniels Consulting's energy and natural resources practice and is a former lobbyist for coal producer Murray Energy Corp. He also previously served as staff director and chief counsel at the Senate Environment and Public Works Committee, including under former chairman U.S. Sen. James Inhofe, R-Okla.

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Federal agencies
March 27

The U.S. Environmental Protection Agency will hold a public listening session in Gillette, Wyo., on its proposed repeal of the Clean Power Plan.

Industry events
March 26-29

The Energy Thought Summit will take place in Austin, Texas.

March 27

The National Association of Regulatory Utility Commissioners will host the first of two webinars on the recent extension and expansion of federal tax credits for carbon capture storage and utilization.

March 28

The U.S. Energy Association will host a discussion at its Washington, D.C., office on what the U.S. can learn from Europe about integrating intermittent renewable energy.

Other notable stories from last week

FERC gives stakeholders more time to weigh in on resilience initiative

EPA chief takes aim at agency use of 'secret science'

FERC storage rule raises questions of cooperative federalism

US refuses EU request for softer solar tariffs

Army Corps will miss April deadline on Dakota Access review

Carbon capture, inland waterways receive spending bumps in FY'18 budget

DC Circuit affirms US EPA's regional haze rule revisions

Democrats ask BLM to get more input before rolling back methane rule