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OVERPLAYING THEIR HAND? Are progressives overplaying their hand with their attempts to shape Joe Biden’s staff and agenda?
Biden hasn’t made any Cabinet picks yet, but Politico reported yesterday that some on his transition team are annoyed at how liberals reacted to some of his early selections for White House staff.
For example, the youth climate group Sunrise Movement accused Biden this week of “betrayal” for hiring Rep. Cedric Richmond, a top campaign surrogate, as a senior adviser focused on public engagement because he has received funding from the oil and gas industry representing a fossil fuel district in Louisiana.
A liberal climate advocate who’s been in conversation with the Biden team told Josh that the backlash at Richmond doesn’t make much sense, given he’ll have little to no role in shaping climate policy.
“I do think the outcry over Cedric Richmond was a bit overplayed by some on our side,” the activist said. “He’s been a top Biden surrogate from the very beginning, this wasn’t a surprise and probably wasn’t stoppable, and it’s not clear he’ll actually have much influence on climate policy. It’s a reminder that Biden won’t be stocking the entire government with progressives, but it doesn’t tell us much about his other picks.”
Liberal climate activists, however, plan to press their demands, which include having Biden reject appointing people who’ve received fossil fuel funding or are too accommodating to natural gas. Their appeals so far seem to be working with the agencies we cover. Biden’s team is reportedly leaning toward choosing Rep. Deb Haaland, a liberal Native American from New Mexico who supports banning new drilling on federal lands, as Interior secretary over more centrist options such as Sens. Tom Udall and Martin Heinrich, both of New Mexico.
“Anonymous centrists quoted by Politico will literally never support any amount of pushback from the left. Joe Biden ran and won by a wide margin on the most progressive platform by a major party candidate in history, and we’ll continue working with his team and pushing him to live up to his mandate for bold action to help working people and frontline communities,” Collin Rees, senior campaigner with Oil Change U.S., told Josh.
Welcome to Daily on Energy, written by Washington Examiner Energy and Environment Writers Josh Siegel (@SiegelScribe) and Abby Smith (@AbbySmithDC). Email [email protected] or [email protected] for tips, suggestions, calendar items, and anything else. If a friend sent this to you and you’d like to sign up, click here. If signing up doesn’t work, shoot us an email, and we’ll add you to our list.
BIDEN TO USE PROCUREMENT TO GO GREEN: Biden will have an influential tool at his disposal to boost clean energy technologies and slash carbon emissions: the purchasing power of the federal government.
In his campaign climate plans, Biden promised to use the federal government’s $500 billion-per-year purchasing power to “drive toward 100 percent clean energy and zero-emissions vehicles.” Biden has also pledged to expand federal procurement even further, by an additional $400 billion over his four-year term.
Such increased government spending will give conservative budget hawks pause, but even they say Biden will have a lot of leeway with how the government spends its money.
And the enormous spending power of the federal government gives Biden major, and near-immediate, influence on clean energy markets.
“The government buys a lot of things, and part of what they buy is energy. They buy all kinds of products,” said Conrad Schneider, advocacy director for the Clean Air Task Force. “Using the power of the purse to procure clean energy and be able to bring new, emerging clean technologies into commercialization is actually a very, very powerful tool.”
More in Abby’s story posted this morning.
FULL SOLAR TARIFFS REINSTATED: A decision by the U.S. Court of International Trade late yesterday allowed the Trump administration, after several unsuccessful attempts, to reinstate tariffs on bifacial solar panels.
It’s a blow to solar industry groups that had been fighting to keep the exclusion for bifacial panels initially granted by the Trump administration in 2019. White House officials quickly changed their minds about the exclusion, likening it to a loophole, and sought to get rid of it. The Trump administration had been slapped down twice by the trade court.
Yesterday’s ruling, though, comes following a proclamation from President Trump last month recommending revoking the exclusion for bifacial panels. Trump said excluding bifacial solar panels from the tariffs on imported panels and modules has “impaired” their effectiveness.
In the proclamation, Trump also said it is necessary to bump up the tariffs in their fourth year from 15% to 18% to account for the effect of the exemption on bifacial panels.
The fight isn’t over: Solar industry groups were quick to note the trade court’s ruling was largely procedural (not allowing them to amend their filings in ongoing litigation to also challenge Trump’s proclamation), rather than on the merits of reinstating the tariffs.
The Solar Energy Industries Association said it is exploring all legal options, including directly challenging Trump’s proclamation.
“The latest effort by the administration to reverse direction on the bifacial exclusion, as well as increase the Section 201 tariffs starting in February, is baseless,” said John Smirnow, SEIA’s vice president of market strategy and general counsel. “The bifacial exclusion has already saved consumers hundreds of millions of dollars and many thousands of American jobs— and it should be preserved.”
SEIA is hoping to persuade Biden to remove the tariffs altogether once he gets into office.
PLEASE DON’T TARIFF US: Members of the Senate’s bipartisan climate change caucus met virtually yesterday with European officials to discuss “international climate cooperation,” according to a readout of the conversation.
The conversation with Frans Timmermans, the European Commission’s executive vice-president for the European Green Deal, and Stavros Lambrinidis, the EU ambassador to the U.S. had to be awkward.
The EU is considering imposing a border carbon adjustment on products based on their carbon and methane content as part of its mandate for the bloc to reach net-zero emissions by 2050. For the U.S. to stay competitive in that scenario, many analysts say it would need to impose a domestic carbon tax or other policy to provoke emissions reductions.
Sen. Chris Coons, the Democratic co-chair of the caucus, seemed to acknowledge the U.S.’ vulnerability to so-called “climate tariffs” by saying the U.S. “must join our European allies in leading by example on climate action by reducing our emissions.”
ON THE WAY OUT THE DOOR: The Trump administration issued a proposed rule yesterday to weaken Obama-era safety regulations for offshore drilling in the Arctic Ocean.
The Interior Department said in a statement that the revisions would “remove unnecessary, burdensome provisions” in the 2016 rules, measures put in place following the Deepwater Horizon spill.
There is no active drilling in the Arctic, after the Trump administration delayed a plan to expand drilling and in other federal waters because of a federal court ruling. The decision blocked Trump from reversing President Barack Obama’s ban on oil and gas drilling in most of the Arctic Ocean and a small portion of the Atlantic Coast.
But the Trump administration and industry groups want to pave the way for the U.S. to stay competitive in the Arctic.
“The U.S. may be missing out in a leadership role in the Arctic, a region where Russia and China are trying to take control and develop,” Erik Milito, president of the National Oceans Industries Association, told Josh.
Short shelf life: Biden will likely quickly dispose of the rule as he has proposed to ban all new offshore drilling in federal waters.
“With a new administration coming in that has pledged to keep new drilling out of the Arctic, this is an obvious play to add to the environmental rollbacks that the Trump team has sought and that the incoming Biden administration will have to roll up its sleeves to fix,” said Leah Donahey, legislative director of the Alaska Wilderness League.
MEANWHILE, MORE PRESSURE AGAINST ANWR DRILLING: A group of investment firms, conservationists, and indigenous groups are calling on insurers to not support oil drilling in the Artic National Wildlife Refuge.
The Gwich’in Steering Committee, a group representing indigenous tribes that live in Alaska, organized a letter yesterday with Boston Common Asset Management and Domini Impact Investments that was sent to insurance giants American International Group and Allianz SE. It’s a new front in a campaign against backing drilling in ANWR after similar lobbying pushed most large U.S. banks to refuse to finance oil development in the Arctic.
“The banking industry already sent a loud, clear message to oil companies. Now it’s up to insurers to say no to drilling in the Arctic Refuge,” said Bernadette Demientieff, executive director of the Gwich’in Steering Committee.
Despite the opposition, the Trump administration this week moved to beat the clock on auctioning off oil leases in ANWR before Biden can undo it.
PAGING MCCONNELL AND SCHUMER…DON’T FORGET ABOUT FERC: If you thought we could go a day without writing about FERC, you were wrong. A coalition of 27 energy, labor, and business groups across various sectors wrote to Senate leaders yesterday urging them to quickly schedule a floor vote on pending FERC nominees that would give the commission a full complement of members.
“FERC cannot approve new infrastructure, review rate or service proposals, or perform other key functions without a quorum. We ask that you support our efforts to create a modern, clean, reliable, and affordable energy system by filling the vacant seats on the Commission as quickly as possible,” said the groups, which include the U.S. Chamber of Commerce, American Petroleum Institute, American Council on Renewable Energy, the Association of Union Constructors, and more.
The Senate Energy and Natural Resources Committee approved the nominations of Republican Mark Christie and Democrat Allison Clements to FERC this week, but it’s unclear if they will get a floor vote during the lame duck.
CABINET TALK: Biden said yesterday he has settled on a choice for Treasury secretary and suggested that the person would be a crowd-pleasing pick among both centrist and liberal wings of the Democratic Party, reports the Washington Examiner’s Emily Larsen.
The pick, Biden teased, will be revealed “either just before or just after Thanksgiving.”
Who will run the Treasury is a top issue of contention among Democrats, and a big area of focus for climate activists who want to see it force companies to disclose their risks related to global warming. Biden’s choice will provide a hint about how much he will adopt progressive versus centrist policy positions in his administration.
Lael Brainard, a Federal Reserve governor and former under secretary of the Treasury under Obama, is considered a front-runner for the position. Massachusetts Sen. Elizabeth Warren and former Federal Reserve Chairwoman Janet Yellen have also been floated as potential picks.
OIL ISN’T GOING ANYWHERE YET, DALLAS FED SAYS: “There will be a healthy oil and gas industry for years to come, but it will be more consolidated,” said Robert Kaplan, president and CEO of the Federal Reserve Bank of Dallas during remarks at its energy conference this morning.
Kaplan said the U.S. oil industry is consolidating in part to deal with the costs of shifting more to automation and managing pressure to minimize its greenhouse gas footprint, all while experiencing a lower price environment.
“They’re going to need to be able to find ways to lower their costs, and scale is critical to that. Technology will be critical to that so they can operate potentially in a lower for longer price environment and adapt to a number of the environmental restrictions,” he added.
Meanwhile, the Dallas Fed sees significant growth opportunities for wind, solar, and battery storage technology, meaning fossil fuels will be a smaller portion of overall energy consumption in the years to come in the U.S. and globally.
What does that mean for jobs? Kaplan says there will continue to be “plenty of jobs,” even as oil and gas companies look to use more technology and automation to operate wells.
But he suggests the “mix” of jobs in the energy industry will shift, as the renewable energy industry continues to grow and oil and gas companies increase their use of carbon capture and storage technologies. Beefing up skills training in the U.S. will be “dramatically more important” to stay on top of those changes, Kaplan added.
The Dallas Fed isn’t pricing climate risks: While the Federal Reserve Board of Governors in Washington is turning its attention to climate change lately, the Dallas Fed isn’t following suit. Kaplan said while the Dallas Fed examines how energy markets are changing, its mandate is to address financial conditions more broadly.
“We don’t pick industries,” he said in response to a question about how the Dallas Fed views renewable energy and market risks from climate change. “That’s the role of elected officials and the executive branch.”
The Fed’s Board of Governors, however, in recent weeks has sounded the alarm on climate risks and suggested it should incorporate such risks in financial regulation. The Fed has also requested to join a global network of central banks focused on managing climate risks to the market and boosting clean energy finance.
CARBON REMOVAL HOW-TO GUIDE FOR BIDEN: Carbon removal advocates are calling on the Biden administration to prioritize boosting technologies like direct air capture and land-based approaches like storing carbon in soil and forests.
Carbon180, in recommendations yesterday to the Biden transition team, called on the incoming administration to embed carbon removal across all federal agencies and climate efforts. That includes establishing staff at the White House level, such as in the Office of Science and Technology Policy and on the Domestic Policy Council, said Giana Amador, the group’s managing director.
Amador told Abby they’re hoping the Biden administration can bring coordination to carbon removal policy in a way that supports significant growth. Carbon180’s recommendations include calls to beef up carbon removal resources at several different agencies, as well, such as the Department of Agriculture, the EPA, the Department of Energy, and the Department of Interior.
The group is also encouraging Biden to work with Congress (where he’s likely to see strong bipartisan support for carbon removal) on a “CarbonShot” initiative to boost research and development funding by $10 billion over the next decade, with a goal of bringing the cost of carbon removal down to $100 per ton by 2025.
“We’re really ready to take carbon removal and not only scale it up but have that sort of economy-wide coordination across agencies,” Erin Burns, Carbon180’s policy director, told Abby. “The new administration will be in the best position to do that.”
They might not have to do much convincing. Biden’s Energy Department transition team includes Noah Deich, Carbon180’s executive director. And Biden’s climate plans also include strong support for carbon capture and carbon removal, a step that helped bring unions on board but could cause a rift with liberal environmentalists once he enters the White House.
US ELECTRIC CAR MARKET SET TO GROW NEARLY FIVE-FOLD: New analysis from Frost and Sullivan yesterday estimates U.S. electric vehicles sales could reach nearly 7 million by 2025, up from 1.4 million sales this year.
Much of that growth will be driven by state-level incentives for electric car owners, such as exemptions from state inspections offered in states like Massachusetts and Connecticut, the analysis says.
More than 90% of states provide incentives to build EV charging infrastructure, said Prajyot Sathe, who manages Frost and Sullivan’s mobility practice. In addition, 39 states offer “meaningful quality of life incentives and exemptions” that will help increase demand for electric cars, Sathe added.
While Frost and Sullivan expects “impressive” sales of battery-electric cars in the next several years, the analysis still expects mild-hybrid electric and full-hybrid electric cars to make up the largest part of the electric market in 2025.
The Rundown
RUNDOWN
Washington Post Biden vowed to ban drilling on public lands. It won’t be easy.
New York Times Trump’s EPA chief plans two foreign trips before leaving office
Wall Street Journal GM ups bet on EVs as investors swoon for electric cars
Los Angeles Times Los Angeles can restrict oil and gas drilling with buffer zones, city attorney says
Calendar
MONDAY | NOV. 23
The House and Senate are out.
