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EPA PLAN FACES DOUBTS ON BOTH SIDES: Some climate groups and fossil fuel interests are singing in the same key about the upcoming EPA greenhouse gas rules for power plants: Carbon capture and sequestration isn’t ready.
What’s coming: The Supreme Court ruled last year that EPA can’t use generation shifting as the basis of its GHG performance standards for power plants, requiring it to pick an alternative “best system of emission reduction” upon which to build its regulations for limiting emissions.
EPA is expected to propose its GHG standards for new and existing coal- and gas-fired power plants this week, and multiple reports indicate the agency will rely on CCS as its best system of emission reduction.
The Clean Air Act requires that EPA choose a system that’s been “adequately demonstrated,” and EPA already made that determination in 2015 in setting partial CCS as the basis for its new coal-fired power plants, of which there have been none since that rule was finalized.
But several groups, including coal interests that support CCS in other contexts, are opposing it in practice here as an adequately demonstrated system of emissions reduction under the Clean Air Act.
CCS in brief: Congress provided more money for carbon management in the Inflation Reduction Act, increasing tax credit values for both the capture of carbon and its utilization.
The bipartisan infrastructure law also provided funding for new CCS demonstration at coal, gas, and industrial facilities.
Up to this point, though, the technology has struggled. A GAO report published in December 2021 found that the Department of Energy put $1.1 billion toward 11 carbon capture demonstrations over the preceding decade, only three of which were built, and only two of which remained in operation at the time of the report. Neither of those is a power generation facility.
Importantly, pro-carbon management interests have made the argument that those failures had more to do with inadequate federal policy support at the time the demonstrations were funded and rolled out, something now being righted by new laws, especially the IRA.
Who’s saying what: The National Mining Association, which represents coal interests, is among the fossil fuel interest groups speaking out against the prospect of CCS-based performance standards in the upcoming rulemaking alongside groups like Food & Water Watch, an environmental group that, unlike many of its peers, opposed the Inflation Reduction Act as too favorable to oil and gas.
NMA supports carbon capture to reduce greenhouse gas emissions and said the IRA and infrastructure law made conditions more favorable for the technology to expand, but the group said CCUS remains neither “technically or economically demonstrated” to serve as the basis for performance standards.
“Promulgating a CCUS-based standard in advance of a more robust demonstration would not only violate the Clean Air Act, it would also inhibit investment in the technology, since the additional compliance risk associated with a mandatory standard would pose yet another uncertainty that would discourage the financing needed to make these billion-dollar projects economically viable,” NMA said in comments published in January in advance of the rule.
Food & Water Watch has an entirely different philosophical position on the technology but has issued similar misgivings about the capacity for carbon capture to clean up the power sector.
Jim Walsh, FWW’s policy director, said his group fears a CCS-based standard would prolong the status quo of a power sector dominated by fossil fuels.
“This is technology that isn’t ready for primetime, that is not going to be effective,” Walsh told Jeremy, “and if it does get built, what we’re going to see is a lot of money wasted on projects that do little if anything to address climate crisis and further our dependence on fossil fuels.”
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DEMOCRATS DEMAND WH GIVE MORE SCRUTINY TO LNG PROJECTS: Congressional Democrats want more scrutiny of LNG projects from the White House, which has closely embraced the sector because it is helping meet allies’ energy needs.
The dozens of lawmakers, in a letter to CEQ this morning, said the council needs to issue NEPA guidance with “a specific review process for LNG” to include directions to relevant agencies for more comprehensive lifecycle emissions analyses to more accurately account for all emissions associated with LNG production and exports.
“The continued buildout of LNG infrastructure is at odds with the Paris climate goals and U.S. climate commitments,” wrote the lawmakers, led by Sen. Jeff Merkley and Rep. Jared Huffman.
Current methods “narrowly examine the relative emissions footprint of LNG with coal-fired electricity and fail to incorporate upstream methane emissions, which – given methane’s much higher global warming potential – make LNG exports worse than coal.”
The U.S. is now Europe’s top supplier of LNG, thanks to the Biden administration’s endorsement. The Department of Energy has been issuing authorizations to expand LNG exports, most recently with the Alaska LNG project, from existing and future terminals to serve the administration’s goal of raising exports to aid the Europeans in reducing imports from Russia.
FERC, which is independent, in November also approved Commonwealth LNG’s application to build a 1.18 billion cubic feet-per-day export terminal in Lake Charles, Louisiana, the commission’s first approval for a major new LNG export project in more than two years.
The White House pledged to crack down on methane emissions alongside its LNG export campaign and is in the process of finalizing a rulemaking to tighten methane regulations for new and existing oil and gas sources.
A price cap: The lawmakers went further, saying that where the administration decides to work to accelerate LNG exports on foreign policy grounds, the price should be limited to cover production and delivery costs and no higher “so as to remove any potential for war-time profiteering and to remove the incentives to continue exports after the short-term foreign policy needs have expired.”
UKRAINIANS FLEE ZAPORIZHZHIA AHEAD OF PLANNED COUNTEROFFENSIVE: Hundreds of Ukrainian civilians began fleeing areas near the Russian-occupied Zaporizhzhia nuclear power plant this weekend amid renewed fears of violence and danger as Ukraine readies to launch a counteroffensive to regain the lost territory.
Officials said that at least 1,600 people and 660 children have evacuated in anticipation of the counteroffensive.
Russia is overseeing the evacuations, and is giving precedence to those who accepted Russian citizenship in the first months after the area fell to their control in early 2022.
Zaporizhzhia is the largest nuclear power plant in Europe, and Russia’s control of the area and heavy shelling near the facility have come under repeated, heavy criticism from International Atomic Energy Agency Director-General Rafael Grossi. Grossi led a team of international experts to inspect the site last fall and installed several IAEA personnel full-time after his efforts to secure a safe zone around the facility failed.
Speaking to reporters over the weekend, Grossi described conditions as growing “increasingly unpredictable and potentially dangerous” near Zaporizhzhia as military activity increases, and noted that IAEA personnel stationed at the plant are now hearing shelling on a regular basis.
“I’m extremely concerned about the very real nuclear safety and security risks facing the plant,” Grossi said. “We must act now to prevent the threat of a severe nuclear accident and its associated consequences for the population and the environment.”
EL PASO VOTERS REJECT CONTROVERSIAL ‘CLIMATE CHARTER’: Voters in El Paso, Texas voted Friday to reject “Proposition K,” or the controversial climate change charter that would have set aggressive new targets for renewable energy in the city, while also drastically scaling back use of fossil fuels.
El Paso’s County Elections Department said Saturday that more than 81% of voters rejected the sweeping measure, while just 18% voted to support it.
A refresher: “Prop K,” as it was known, had set deeply ambitious targets for renewable energy in El Paso, calling for 80% of the city’s power to be generated by “clean renewable energy” by 2030, and 100% by 2045. It also would have created a new city-wide climate department in El Paso, tasked with preparing an annual climate mitigation, preparedness, and response plan, and overseeing the transition of all city-owned facilities to renewable energy sources.
Prop K had been the subject of months of heated debate in El Paso. It had pitted climate activists—in particular, the left-wing Sunrise Movement—against business and industry groups, including the El Paso Chamber, which derided the push as “rushed,” “unrealistic,” and a threat to economic development in the area.
NORTHERN VIETNAM RISKS POWER OUTAGES AS HOT SEASON BEGINS: Northern Vietnam is bracing for an electricity shortfall at the start of its hot season, state utility Vietnam Electricity Group warned in a recent report, due to dry, high conditions, lower hydroelectric power production and a dearth of coal and gas power production.
Northern Vietnam could face a supply shortage of as much as 4,900 MW between May and July, according to the utility. That’s due both to higher demand, which they predict will rise by around 15%, as well as hot and dry conditions caused by the El Nino weather pattern, which will cut into its hydropower generation.
Already, water flows to the hydroelectric reservoirs has been as low as 70% compared to normal seasonal averages, and an early-season heat wave caused temperatures in some provinces to rise as high as 111 degrees Fahrenheit over the weekend.
Meanwhile, the utility’s coal-fired plants are reporting a 1.3-million-ton production shortfall due to low supplies, and gas output is slated to drop by more than 18% compared to last year, the report said.
OIL PRICES RISE ON STRONG JOBS REPORT: Oil prices rose by more than 2% today as fears about a U.S. recession eased following Friday’s strong jobs report, and as traders, including Goldman Sachs analysts, dismissed recent concerns of an oversupplied oil market as “overblown.”
Futures for international benchmark Brent crude rose by $1.57 to $76.87 per barrel by mid-morning, while futures for West Texas Intermediate (WTI) saw a 2.4% increase, or $1.73, to $73.07 per barrel.
Back above SPR refill price: But oil’s rise once again complicates the Biden administration plan to refill the Strategic Petroleum Reserve following Biden’s historic drawdown of 180 million barrels last year, which sent the stockpile plummeting to its lowest point in more than 40 years.
The Department of Energy has said it intends to begin refilling the reserve when oil prices falls to $67 to $72 per barrel—or, where prices have been in recent weeks. And last month, when oil began to fall sharply amid recession fears and lower Chinese demand, Energy Secretary Jennifer Granholm said the administration hoped to begin refilling the SPR “soon.” But this week’s futures appear to put that out of the question again, at least for now.
The Rundown
Bloomberg Biden administration tamps down talk of US-China decoupling
Wall Street Journal ‘Over our dead bodies’: backlash builds against $3 trillion clean-energy push
