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DOMESTIC MINING STILL ON THE TABLE: The Biden administration is tentatively backing domestic mining to help meet the growing demand for critical minerals that will be created by aggressive adoption of electric vehicles and renewable energy.
In a report on supply chain vulnerabilities released this morning, the Biden administration doesn’t rule out bolstering the domestic mining sector, as previous reports had suggested it might due to environmental concerns.
The issue is tricky for President Joe Biden. Meeting his ambitious climate plans will undoubtedly prompt significant growth in the demand for critical minerals. Environmentalists and tribal groups, however, have often balked at expanding mining on U.S. soil, arguing the projects will destroy lands and habitats and jeopardize the health of low-income and minority people living closest to the mining sites.
Nonetheless, the administration’s report outlines domestic production of critical minerals, including lithium, nickel, and cobalt needed for electric car batteries, as a vital piece of the administration’s strategy to secure a domestic supply chain for minerals that China largely dominates the production of today. The report also recommends boosting the U.S. ability to process critical minerals, expanding recycling of batteries and minerals, and supporting research to produce minerals through means other than mining.
A significant caveat: The Biden administration’s report doesn’t include many recommendations that would help push pending critical minerals projects across the finish line more quickly.
For example, while the report acknowledges that mining projects in the United States often take 10 years or more to build, the administration doesn’t say whether it will work to speed up permitting for mining efforts, as industry groups and Republican lawmakers have encouraged.
Instead, the Biden administration is calling for the development of “sustainability” standards for critical minerals mining, to ensure any new domestic production meets strong environmental requirements. The report suggests the Energy Department and the EPA lead development of such standards, though it doesn’t define what would qualify as “sustainably produced” critical minerals.
“A recognized sustainability standard, potentially backed by legislation, and coordinated with trading partners, would encourage private sector investment in sustainable sources and increase supply chain resilience,” reads the critical minerals section of the report, led by the Defense Department.
Mining industry is optimistic: For now, the mining industry is welcoming the Biden administration’s report, and they’re underscoring that the supply chain risks the report identifies make it clear that more domestic minerals production is needed.
“Rebuilding domestic mineral production to underpin infrastructure reinvestment, our national security, and to deploy advanced energy technologies at the speed and scale climate action requires means we must move immediately to support domestic mining, reduce barriers to bring responsible production to market, and ensure that ‘Made in America’ is also ‘Mined in America,’” said Rich Nolan, CEO of the National Mining Association, in a statement.
Biden’s test to come, however, will be whether and how quickly his administration allows shovel-ready mining projects, most of which face environmentalist opposition, to move forward. Having a readily available supply of these minerals will be important to Biden’s climate plans.
For example, Energy Department analysis included in the supply chain report shows that reaching 100% electric vehicle sales in the United States would require a supply of lithium 200% greater than what was mined in 2019.
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.
DOJ RECOVERS COLONIAL PIPELINE RANSOM: The Justice Department has recovered most of the $4.4 million cryptocurrency ransom that Colonial Pipeline paid to the Russia-based DarkSide ransomware hacker group last month.
The Justice Department said yesterday that it had seized 63.7 bitcoins currently valued at roughly $2.3 million after Colonial had paid the hackers approximately 75 bitcoins in early May.
Our Justice Department reporter Jerry Dunleavy has more.
COLONIAL CEO DEFENDS RESPONSE TO CYBERATTACK: Colonial CEO Joseph Blount today defended his decision to pay the ransom, a move he made on his own without the government in order to restore fuel service to the nation’s Southeast as “quick as possible.”
“I believe with all my heart it was the right choice to make, but I want to respect those who see this issue differently,” Blount said in testimony before the Senate Homeland Security and Governmental Affairs Committee. Blount added the decision was the “hardest” he’s ever had to make in his 39 years in the energy industry.
The shutdown of the pipeline that provides 45% of the Southeast’s fuel prompted gasoline panic-buying resulting in thousands of gas stations closing because of a lack of product.
Despite the nation’s reliance on the pipeline, Blount acknowledged the VPN that hackers used to access the company’s computers only had single factor authentication, rather than two.
Asked by GOP Sen. Josh Hawley of Missouri how much Colonial spends on cybersecurity per year, Blount said Colonial invested $200 million the last 5 years on its IT systems, but he did not specify how much of that was to protect from cyber intrusions.
MORE INTEREST IN COAL TO SMALL NUCLEAR TRANSITION: Utility Dominion and advanced reactor company NuScale are optimistic about building new small nuclear plants at retired coal units.
Representatives from both companies spoke positively about the idea yesterday at the Nuclear Energy Institute’s Nuclear Energy Assembly, which comes a few days after TerraPower and utility PacifiCorp announced a first-of-its-kind partnership to build an advanced nuclear reactor at a retiring coal plant in Wyoming.
John Hopkins, chairman and CEO of Oregon-based NuScale, said the company is having discussions with U.S. utilities about the concept. NuScale recently produced a report documenting the overlap between coal and nuclear jobs. “We are certainly bullish on it,” Hopkins said.
Dan Stoddard, senior vice president and chief nuclear officer at Virginia-based Dominion, said the utility is in the process of evaluating potential sites to build an advanced nuclear plant. He called siting nuclear at a coal plant a “great opportunity,” noting the new plant could link up with existing transmission lines and other infrastructure.
Hurdles remain: Stoddard said small nuclear reactors have the potential to be an “important piece of the puzzle” of Dominion reaching its target for zero-carbon electricity. But he acknowledged there is a “reluctance” among investor-owned utilities to be the “first” to sign up for such projects given the technology is unproven.
“We need to see sufficient progress of, ‘yes have we have confidence this really can happen on time and on budget,’” Stoddard said.
REPUBLICANS PUSH BIDEN TO REVERSE NS2 WAIVER: More than 60 House Republicans wrote a letter to Biden yesterday calling on him to restore congressionally mandated sanctions on Russia’s Nord Stream 2 natural gas pipeline to Germany.
“This action, which will send more Russian natural gas to Europe, puts U.S. resources at a distinct competitive disadvantage, costing American jobs and reducing America’s geopolitical influence,” wrote the Republicans, including leader Kevin McCarthy of California, Energy and Commerce Committee ranking member Cathy McMorris Rodgers of Washington, and Garret Graves of Louisiana, the top GOP member of the House Select Climate Crisis Committee.
The Biden administration recently chose not to sanction the Russian company in charge of constructing the pipeline, which was mostly completed during the Trump administration, in order to rehab strained relations with Germany.
Secretary of State Antony Blinken told Republicans at a House Foreign Affairs Committee hearing yesterday it is likely too late for the Biden administration to stop the pipeline with sanctions so it is not worth damaging relations with a key ally.
ROMNEY DISMISSES CARBON PRICING TO PAY FOR INFRASTRUCTURE: Sen. Mitt Romney of Utah, a centrist Republican working on a bipartisan infrastructure deal, dashed the hopes of carbon tax proponents yesterday by telling reporters he and his colleagues are not considering carbon pricing to help pay for spending on roads and bridges.
Romney’s comments came after Fox News reported a group of centrist senators and House lawmakers are preparing to release a package focused on “hard infrastructure” that would use a carbon price as a revenue source.
Romney has come close to endorsing a carbon price proposal that would return the revenue to taxpayers, but does not support inserting the issue into infrastructure discussions. No Senate Republican has introduced carbon pricing legislation.
ENVIRONMENTALISTS’ PICK TO LEAD BIDEN’S EX-IM BANK: Eight environmental groups, including Friends of the Earth, Greenpeace, and Oil Change International, are calling on Biden to nominate veteran solar industry executive John Stanton to lead the Export-Import Bank.
Stanton, who has served on the leadership teams of SolarCity and the Solar Energy Industries Association, would be able to lead the Ex-Im away from fossil fuels, the groups said in a letter sent May 26 to the Biden administration and shared with Abby. Environmental groups have called on the bank to end all support for fossil fuels overseas, though Biden’s international climate finance plan largely skips such directives to the bank.
“EXIM is currently considering supporting oil and gas development in Bahrain, an oil refinery in Kazakhstan, and a long list of environmentally destructive projects,” the environmental groups wrote, citing the agency’s list of pending transactions. “Having strong environmental leadership at EXIM is critical to curbing support for these projects that are so harmful for the climate and local communities.”
PHMSA NUDGES PIPELINE OPERATORS TO CONTROL METHANE: The Pipeline and Hazardous Materials Safety Administration, in an advisory slated to be published later this week, is reminding pipeline operators of their obligation to reduce leaks of methane from their systems as part of bipartisan pipeline safety legislation signed into law last year.
Under the law, pipeline operators must update their inspection and maintenance plans by Dec. 27 to include methods to prevent both unintentional leaks and venting of methane. The updated plans must also address how operators will replace or remediate pipelines made from materials such as cast iron or bare steel known to leak the most.
Environmentalists welcomed PHMSA’s advisory as a sign the Biden administration intends to keep the pressure on the whole scope of the oil and gas industry to curb its methane emissions. The bipartisan measure approved last year also directs PHMSA to craft standards for pipeline operators to find and fix methane leaks, which the agency is working on through a new rulemaking.
BIGGEST Q1 FOR ENERGY STORAGE YET: The United States added 910 megawatt-hours of new energy storage in the first quarter of this year, a 252% increase over that period last year, according to the latest data released this morning by Wood Mackenzie and the Energy Storage Association.
Wood Mackenzie projects nearly 12,000 MWh of new energy storage will come online this year, triple the amount added last year. If Congress passes a standalone tax incentive for energy storage this year, as has been proposed in bipartisan legislation and backed by Biden, it would boost energy storage’s five-year market outlook by 20% to 25%, Wood Mackenzie says.
The Rundown
New York Times Pipeline protest tests Biden’s pledges on climate and Native American lands
Wall Street Journal Mining companies call themselves green in push for investor cash
Washington Post As leaders gather for G-7, a key question: Will rich countries help poor ones grapple with climate change?
Calendar
TUESDAY | JUNE 8
1:05 p.m. Energy Secretary Jennifer Granholm delivers remarks on her vision for nuclear energy at the Nuclear Energy Institute’s Nuclear Energy Assembly.
WEDNESDAY | JUNE 9
10 a.m. 301 Russell. The Senate Environment and Public Works Committee will hold a hearing titled, “PFAS: the View from Affected Citizens and States.”
