Daily on Energy: Scott Pruitt to end EPA’s ‘sue and settle’ practice

EPA is the first to right a ‘wrong’: “Regulation through litigation is wrong,” Pruitt said. “We are the first agency to issue this directive in a memorandum” to challenge and stop abuse of the sue and settle process, he said.

“It is a practice not unique to the EPA,” he said. But the number of cases brought to the agency put it “in first place,” Pruitt added.

“We are the first agency to take this action,” he said, although Attorney General Jeff Sessions is “keenly interested” in engaging the issue of sue and settle across the government. Pruitt said that “other agencies are taking notice as well.”

Tools in the toolbox: “We are in the process … [to] make a decision of what tools are in the toolbox on how to address CO2,” Pruitt said.

EPA issued its proposed rule last week to rescind the Clean Power Plan, the Obama administration’s top climate rule that required states to cut greenhouse gas emission a third by 2030. It has been stayed by the Supreme Court since last February.

Pruitt said the agency is currently reviewing where EPA has legitimate authority to regulate carbon emissions under section 111 of the Clean Air Act. EPA said the agency could not legally justify regulating carbon emission at the state level when the law under section 111 only gives it authority to regulate individual power plants.

Two-step process: “We have looked at it as a two-step process,” he said. First, EPA repeals the current regulation. Second, it looks at developing a replacement regulation.

At the White House: An advanced notice of proposed rule-making for the replacement climate regulation is currently undergoing interagency review at White House Office of Management and Budget. Look for those discussions to heat up through the end of the year.

Opposition mounts: A range of businesses, from crude oil and natural gas to wind and solar companies, have pushed back against the proposal. Analysts suggest the rule would require months of deliberation and modeling before it could even approach the proposal stage, especially for a regulation that could affect billions of dollars in investments and planning decisions.

Peculiar proposal: Instead, the Perry proposal was shipped over to the Federal Energy Regulatory Commission on Sept. 28 in a peculiar way that broke with 40 years of commission precedent. FERC typically doesn’t issue rule-makings at the behest of a Cabinet-level agency.

A proposal from the Department of Energy “is not the standard process” for writing a rule that represents a “significant departure” from the last two decades of electricity regulation, said Judah Rose, senior vice president and managing director at the energy consulting firm ICF, on a recent conference call trying to decipher the harm the rule could cause.

Growing uncertainty: Rose suggested it would be next to impossible in that time frame to do the modeling and analytics required by the commission to evaluate the proposal’s impact. On top of that, ICF sees major costs for natural gas generators trying to abide by the new rules. “So there are costs” for complying with the rule, which is “driving uncertainty,” Rose said.

Natural gas growth will slow: It also is not clear if natural gas plants would be able to benefit from the proposal under the 90-day fuel criteria. Renewables, such as wind and solar, which don’t use fuel, “do not appear to qualify” for any incentives, Rose said. A preliminary analysis by ICF said the rule would cause the growth of gas-fired power plants to drop off because fewer coal and nuclear plants would close.

Perry’s proposal would give coal and nuclear plants the added ability to make up their cost based on their ability to store 90 days worth of fuel on site. The grid operators that FERC oversees would pay the power plants for storing the fuel.

Trump transition chief dumps on plan: The latest big hit came from Thomas Pyle, the former head of Trump’s Energy Department transition team, and the president of the Institute for Energy Research.

Pyle’s group issued an analysis last week that concurred with the scores of industry group, utilities, oil companies, renewable energy groups, and other conservative groups opposing Perry’s 90-day rule.

Pyle’s group is willing to go the furthest to give the proposed rule the benefit of the doubt.

The group concedes that the Energy Department has “identified a real problem,” dinging the “growth of intermittent sources of electricity like wind and solar” that have increased the need for “reliable” baseload power plants, “but the expansion of natural gas generation is an important consideration as well.”

Caught in the middle: Now the Iraqi Prime Minister Haider al-Abadi’s government wants the territory back, in particular Kurdish-held oil fields. That puts the U.S. squarely in the middle of its two allies in the war against ISIS, which is not over yet.

What was taken: The New York Times reports military commanders in Baghdad said their troops had taken control of an industrial district on the western edge of Kirkuk, as well as a power plant and refinery adjacent to the oil fields outside the city.

Global response: Oil prices rose in response to the fighting, and market experts predicted a sustained price rally could occur.

‘Rapid’ moves: Trump, in a tweet, crowed about his “rapid termination” of the international Paris climate change agreement and approvals of the Keystone XL and Dakota Access Pipelines.

What’s really happening: The earliest Trump can remove the U.S. from the Paris deal is Nov. 4, 2020, according to the terms of the agreement. Keystone pipeline developer TransCanada may never build the pipeline, despite White House sign off, and it still needs approval from Nebraska regulators. And federal regulators are currently doing an environmental review of parts of the Dakota Access Pipeline, although the pipeline began operating in June.

Don’t forget: Trump’s repeal of former President Barack Obama’s signature Clean Power Plan, announced last week, is not official, and will prompt a long regulatory, and likely legal fight.

Not going to happen: A carbon tax “that’s just not going to happen,” said Ann Klee, GE’s vice president of environment and health and safety, at the event.

The answer is the market: “The answer has to be the market,” Klee said, adding that the tax is not what industry wants, nor is it feasible. A carbon tax, sometimes referred to as a carbon fee or price, would force industry to pay for emitting greenhouse gas emissions. Proponents say it will encourage a transition away from fossil fuels, like coal and oil, and toward renewable energy resources like wind and solar.

Many scientists blame greenhouse gas emissions, principally carbon dioxide, for increasing the temperature of the Earth, resulting in more severe weather, drought, and flooding.

Klee said the answer to the issue surrounding carbon dioxide and the climate resides in advanced technology development driven by the market, not by picking “winners and losers.”

The message from Harvard: McCarthy was speaking at a Harvard University climate change forum when she was asked by an audience member how she felt about Trump deciding to rescind her decision to raise fuel economy standards for cars and light trucks.

Simply put: “I don’t like it,” she said. “That was a very simple answer to the question.”

McCarthy went on to suggest that the auto industry would regret asking Trump to roll back her decision.

“Everybody goes to the president to ask for everything,” she said. “And he said yes. Oops.”

Trump is a bad mom: It’s like a “little kid eating birthday cake” and “they’re sick now” because “mom” said yes to too much too soon, McCarthy said. She predicted an auto-industry reversal at some point.

Automakers had lobbied Trump to reconsider McCarthy’s decision to increase the fuel-economy standards, even though many companies continue to roll out fuel-efficient car models, along with electric models that would help them meet the standards.

Two plants fade into sunset: The utility firm Luminant announced that it would close the Sandow Power Plant and the Big Brown Power Plant in early 2018. The power plants comprise 2,300 megawatts of electricity, which means 2.1 million homes in the Lone Star State will no longer be powered by coal.

What fills the gap: That gap in electricity generation is projected to be filled by wind farms in the Texas energy grid known as ERCOT, according to an analysis issued by the University of Texas at Austin’s Energy Institute soon after Luminant’s announcement.

“New coal retirements announced by Luminant (Big Brown and Sandow plants) means ERCOT will soon lose significant coal generation capacity. At the same time, wind capacity is expected to increase by nearly 4,000 [megawatts] by 2018, meaning wind capacity will soon exceed coal capacity in Texas,” the Energy Institute said.

Wind’s future: “Given current capacity factors for the respective technologies, it’s conceivable that energy generation from wind could possibly overtake coal in the near future,” it said in a release.

Facts and figures: The total amount of wind energy will reach 24,400 megawatts and coal shrinks to 20,370 megawatts, according to the university. 

Setting the standard: “From day one, I made it clear that I have zero tolerance for harassment in the workplace, and I directed leadership in the National Park Service to move rapidly to improve accountability and transparency,” Secretary Zinke said.

The scope of the problem: The National Park Services Environment Survey found 10.4 percent of the service’s employees have experienced sexual harassment in the last 12 months. Around 19 percent experienced harassment based on their gender, while just under 1 percent had reported experiencing sexual assault.

What else the study said: The study also examined instances of harassment based on age, race, ethnicity, religion, disability, and sexual orientation. “Overall, 38.7% of employees reported experiencing some form of harassment in the last 12 months and survey results indicate many experienced some form of harassment prior to the last 12 months,” said the Interior Department on Friday.

Offenders disciplined: Zinke said he has already begun to crack down on offending personnel. “I’ve removed a number of people who were abusive or acted improperly that other administrations were too afraid to or just turned a blind eye to,” he said.

“Under my leadership, we’re going to hold people accountable,” he said. “We are also fixing the problem of victims being afraid of retaliation or inaction by codifying the right for victims to report abuse to any manager in any location across the Service, and by bringing on an independent, investigative partner.”

Unknown cause: The cause of the explosion is unknown, but the City of Kenner government said on its Facebook page that “authorities on the scene report that cleaning chemicals ignited on the surface of the oil rig platform.”

Also, an oil spill: The explosion came a day after the U.S. Coast Guard responded to a spill of more than 9,000 barrels of oil in the Gulf Coast off Louisiana.

An underwater pipe burst in the gulf about 40 miles off the coast of Venice.

The offshore oil and gas exporter LLOG Exploration Offshore said up to 9,350 barrels escaped before the spill was stopped and there were no injuries reported.

Remember: The Deepwater Horizon spill occurred in 2010 and dumped nearly 5 million barrels of oil into the Gulf.

Progress made: Two of the largest wildfires, the Tubbs and Atlas fires, were 60 percent and 65 percent contained, respectively, as of Sunday evening, the Los Angeles Times reported. The fires are among many that began Oct. 8 and burned more than 220,000 acres. The death toll is the worst ever for a wildfire event in California.