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Washington Week: Before summer recess Congress allows FERC to get back to work


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Washington Week: Before summer recess Congress allows FERC to get back to work

Congress has adjourned for its summer recess, but the U.S. energy policy landscape could heat up elsewhere the week of Aug. 7-11.

The Federal Energy Regulatory Commission may soon start to whittle down a backlog of pipeline applications and major rate cases after the U.S. Senate restored the agency's quorum right before its August break. The commission, which authorizes interstate oil and gas pipeline construction and regulates wholesale power markets, has lacked a quorum since early February, when former Chairman and commissioner Norman Bay left the agency.

The Senate voted Aug. 3 to confirm two of President Donald Trump's nominees to FERC — Republicans Neil Chatterjee and Robert Powelson bringing the commission up to three members along with Acting Chairman Cheryl LaFleur and restoring the quorum that allows FERC to decide significant matters.

But after six months without a quorum, FERC may take a while to clear the logjam of project applications and rate cases and will still not have a full five members until after Congress reconvenes from its summer break in early September. The Senate Energy and Natural Resources Committee will hold a hearing on Sept. 7 for Trump's other two FERC nominees, Kevin McIntyre and Richard Glick, after the White House submitted their official nominations to the Senate on Aug. 2.

Even a fully staffed FERC could encounter challenges. The agency has increasingly been in the crosshairs of environmental and conservation groups seeking to block controversial energy projects and push the electric power sector more toward renewable energy and away from fossil fuels.

"We remain concerned that Chatterjee and Powelson will continue FERC’s status quo, approving unneeded fracked gas pipelines that take private land for corporate gain and lock Americans into higher electricity rates while increasing our dependency on fossil fuels for decades to come," said Lena Moffitt, senior director of the Sierra Club's Our Wild America Campaign. "These nominees will be met with firm resistance from communities across the country who have fought against the buildout of fracked gas."

Elsewhere on the regulatory front, the Trump administration is following through on its goal to roll back Obama-era climate rules and policies. On Aug. 4 the U.S. State Department was preparing to submit an official notice to the United Nations that it wants to withdraw from the Paris global climate accord, a pact under which the U.S. committed to reducing its economy-wide greenhouse gas emissions by 26% to 28% from 2005 levels by 2025.

The move comes as the U.S. Environmental Protection Agency is expected to formally propose a repeal of the Clean Power Plan, which was aimed at lowering carbon emissions from existing power plants, and replace the rule with a less strict regulation.

Trump has made regulatory relief, particularly for energy producers, a key tenet of his presidency. But one of the White House's planned reforms hit a bump recently, and the EPA itself has reversed course on easing compliance with a major air quality standard.

A federal appeals court rejected EPA's request to stay implementation of Obama administration methane regulations for new and modified oil and gas sources, requiring the agency to enforce the standards. And on Aug. 2, the EPA made a surprise announcement that it would not delay designations for its 2015 ground-level ozone standard, after deciding in June to postpone the designations by one year. The EPA reinstated a deadline to decide which areas are in or out of attainment with the 2015 standard by Oct. 1, 2017.

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Other stories from last week

FERC quorum brings promise of activity to frozen pipeline industry

The news of a restored Federal Energy Regulatory Commission was greeted by a natural gas industry desperate for the body to again have a voting quorum to advance pipelines and other infrastructure projects. About $14 billion in private capital for energy infrastructure projects has been held up by the lack of a FERC quorum, the Interstate Natural Gas Association of America estimated. That number would have climbed if the Senate had not moved on the two new commissioners before its August recess.

EPA to seek Clean Power Plan repeal based on perceived statutory conflicts

The U.S. Environmental Protection Agency is said to be preparing a rulemaking to repeal the Clean Power Plan that would cite a perceived conflict between two sections of the Clean Air Act. Myron Ebell, who advised the Trump campaign on environmental policy and is director of the Competitive Enterprise Institute's Center for Energy and Environment, said in an interview July 25 that the EPA intends to repeal the Clean Power Plan based on the 111(d)/112 exclusion. This was an argument raised during the legal battle against the rule, in which opponents asserted that power plants could not be regulated for carbon emission under Section 111(d) of the Clean Air Act because they are already regulated for mercury emissions under Section 112 of the act.

Interior repeals Obama-era energy valuation reform rule

The U.S. Office of Natural Resources Revenue, or ONRR, is repealing the Obama-era federal energy valuation reform rule. The agency proposed to end the Consolidated Federal Oil & Gas and Federal & Indian Coal Valuation Reform Final Rule in April after putting a pause on it in February. The rule was announced in the summer of 2016 and took effect Jan. 1. ONRR said in the Federal Register to be published Aug. 7 that it was repealing the reform in its entirety. "ONRR discovered several significant defects in the rule that would have undermined its purpose and intent," the office said.

Sierra Club rallies for effluent rule; utilities call review 'vitally important'

The Sierra Club rallied July 31 in Washington, D.C., to press the U.S. Environmental Protection Agency to back off a planned delay and review of the 2015 effluent limitation guidelines for steam electric power plants as the agency held an open house for comment on the proposal. Ahead of the hearing, Sierra Club Beyond Coal Campaign Director Mary Anne Hitt called the actions to delay critical clean water protections from the Trump administration "shameful," and pledged to fight the agency in its efforts to roll back the rule. But the Edison Electric Institute offered its support to the agency. Richard Bozek, EEI's director of environmental and health and safety policy, testified that delay is appropriate, necessary and "vitally important" because the EPA is reconsidering certain portions of the rule following a petition from members of industry to do so.

Solar trade tariffs could upend US solar market, SunPower CEO warns

Slapping trade tariffs on solar panel imports, as two "foreign-owned" U.S.-based producers of photovoltaic cells and modules have asked the Trump administration to do, "could significantly impact the U.S. solar market," SunPower Corp. CEO Tom Werner said, "imposing a direct burden on manufacturers of solar panels and associated equipment, raising prices for customers and eliminating tens of thousands of jobs." Werner's comments to investment analysts during an Aug. 1 earnings call came as the California solar company, itself owned by French energy giant Total SA, considers how to tweak its business if the U.S. International Trade Commission were to recommend levying penalties on foreign makers of crystalline solar cells and panels.

Western lawmakers press FERC for swift review of Jordan Cove LNG

A group of 14 U.S. lawmakers put pressure on federal regulators to swiftly approve the 0.9-Bcf/d Jordan Cove LNG export project proposed for Oregon's coast, saying the $10 billion venture would stimulate economies in their home states of Colorado, Utah and Wyoming. Six senators and eight representatives wrote to the Federal Energy Regulatory Commission in support of the project. Jordan Cove Energy Project LP is again seeking approval after the commission rejected the venture in March 2016 when it determined there was a lack of commercial support for the roughly 230-mile greenfield pipeline that would supply the export terminal.

Senate approves Trump pick for DOE deputy secretary

The U.S. Senate voted 79-17 on Aug. 3 to confirm Dan Brouillette as deputy secretary of the U.S. Department of Energy, giving Energy Secretary Rick Perry his second in command. Brouillette, who served as assistant secretary of energy for congressional and intergovernmental affairs under President George W. Bush, will arrive at DOE as the agency mulls steep budget cuts to its research programs and evaluates the reliability of the electric grid in light of large-scale coal and nuclear plant retirements.