Daily on Energy: Trump’s coal plans could get replaced by petrochem push

Energy Secretary Rick Perry spent part of the week in Kentucky, the home state of Republican Majority Leader Sen. Mitch McConnell, to discuss the idea of creating a multistate petrochemical hub that would include the Bluegrass State, along with Ohio, West Virginia, and Pennsylvania.

Perry began his tour of Kentucky with a visit to the office of Republican Gov. Richard Bevin to discuss the plan.

The Energy Department explained that the trip was made in conjunction with Trump’s recently signed executive order on energy infrastructure, which directs Perry to submit a report to the president with a list of opportunities to promote economic growth in the region, including the growth of the petrochemical industry.

The report will specifically assess methods for “diversifying” the Appalachian economy while promoting workforce development.

Time will tell if the administration is shifting away from focusing on coal toward other promising industries, as natural gas and chemicals from fracking have become a new growth industry in the region.

Companies from as far off as Thailand are looking for opportunities to build facilities to separate and produce highly sought-after chemicals from those natural gas resources. And the Energy Department is working with lawmakers from the region in the House and Senate to investigate the prospects of creating a petrochemical hub in Appalachia that could rival the Gulf Coast’s large more mature complex.

But what about coal? One Republican who was privy to Perry’s conversation with state legislators while in Kentucky says the Bluegrass State is moving away from steam coal production for power plants, and toward becoming a hub for manufacturing.

State Rep. Adam Bowling, the Republican vice chairman of the legislature’s energy and natural resources committee, says he is not 100% sure what a petrochemical hub would mean for Kentucky. The governor’s primary push is to use the state’s central location between the North and the South to attract manufacturers.

Kentucky is not a big fracking state. It still manufacturers coal, but that is on the wane year after year, as coal plants continue to close, Bowling explained.

He also sees the state becoming a bigger developer of solar energy, using abandoned mountaintop removal coal mining sites as the perfect place to build large solar arrays.

Bowling said the idea of transitioning to solar is generally supported in the state, but some in his district where mining is still king are a bit weary.

“A lot of coal jobs have gone away, but there are still coal jobs out there,” he explains. “People realize that steam coal that has always provided the bulk of the jobs in this area, that’s just going to continue to go away.”

The only market that will survive will be for metallurgic coal that is used to make steel, which cannot be easily replaced by renewables or natural gas. In fact, most of the mines that Trump has taken credit for opening in the last two years have been for metallurgic coal, which is in high demand in Asia.

Coal lobbyists tell John that they don’t believe the administration has given up on coal. Perry often says that it must remain a part of the nation’s energy mix along with natural gas and renewables. But new data released by the Energy Department this week shows that states are continuing to use less coal into 2019.

Welcome to Daily on Energy, written by Washington Examiner Energy and Environment Writers John Siciliano (@JohnDSiciliano) and Josh Siegel (@SiegelScribe). Email [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.

PERRY SAYS 100% RENEWABLES WOULD LEAD TO BLACKOUTS: Perry said Friday that switching the nation to 100% renewable energy would lead to permanent black outs if not backed up by other more reliable power plants like nuclear.

“Some people want us to take renewables and just rely upon them solely. But if we follow that advice, now our energy might be cleaner, but nowhere near as reliable,” Perry said Friday morning in addressing the EarthX environmental conference in Dallas.

Perry said solar and wind are too intermittent to be relied upon entirely for the nation’s energy needs. He envisioned a cyberattack or natural disaster crippling the nation indefinitely if it were powered only by solar and wind resources.

“Our lights could go out, stay out, impacting our way of life,” Perry said.

He added that such a danger can be averted if renewable energy is paired with nuclear power plants, like small modular reactors, that provide 24-hour-a-day, reliable electricity.

Perry’s idea supported by the “Green New Deal”: A closer read of the progressive “Green New Deal” resolution would appear to support Perry’s idea of joining renewables with nuclear. The resolution calls for switching the country to zero-emission energy, not exclusively renewables, which would include nuclear power.

Outside of the “Green New Deal,” however, prominent climate activist groups like 350.org do support a switch from conventional sources of energy to a grid powered entirely by 100% renewable energy.

TRUMP ADMINISTRATION POSTPONES OFFSHORE DRILLING PLAN: The Trump administration is delaying its release of a highly anticipated plan to expand offshore oil and gas drilling due to a recent court ruling that has cast doubt over the legality of opening new areas to drilling.

Interior Department Secretary David Bernhardt, in comments reported Thursday, suggested the agency will wait out a potentially lengthy appeals process over a decision last month by a federal judge blocking drilling in the Arctic before deciding which parts of federal waters to allow for fossil fuel energy development.

“By the time the court rules, that may be discombobulating to our plan,” Bernhardt told the Wall Street Journal.

Congress reacts: “The bipartisan opposition that killed this plan now needs to turn into support for permanent protections for the communities that depend on healthy oceans and healthy coasts,” said Rep. Raul Grijalva, D-Ariz., chairman of the House Committee on Natural Resources.

The committee’s top Republican, Rep. Rob Bishop of Utah, expressed confidence Interior would release a revised plan that promotes “economic development.”

What’s really going on? Molly Block, an Interior Department spokeswoman, told Josh the court decision had complicated the agency’s process forcing it to “evaluate its options,” but she disputed characterizations of the plan being indefinitely postponed or withdrawn.

Bloomberg, however, reported later Thursday the Trump administration is also making a political calculus, and is planning to defer the offshore drilling plan until after the 2020 election, due to pushback from coastal Republican lawmakers in tough races.

Rep. Francis Rooney, R-Fla., recently told Josh he’s warned the administration that Trump won’t win Florida, a key swing state, unless the administration pulls the offshore drilling plan.

Industry waits: The American Petroleum Institute and other industry groups urged the Trump administration to act quickly on expanding offshore drilling after the Arctic court case is resolved.

“We are hopeful that an appeal of this case will move quickly and that we can proceed with the important work of exploring for America’s offshore resources without unnecessary delay,” said Erik Milito, API’s vice president of Upstream and Industry Operations.

CHINA’S XI SAYS BELT AND ROAD INITIATIVE MUST BE GREEN, SUSTAINABLE: China’s President Xi Jinping said Friday the country’s Belt and Road Initiative must be green and sustainable, in response to concerns the program cause serious environmental harms and dramatically increase global greenhouse gas emissions.

Xi in a keynote speech at China’s second “Belt and Road Forum” said environmental protection must be a central component of the initiative “to protect the common home we live in.”

“Operate in the sun and fight corruption together with zero tolerance,” Xi said, in comments reported by Reuters.

The Belt and Road Initiative aims to enhance international trade through a network of infrastructure projects across Central and Southeast Asia, the Middle East, and Africa, with the Chinese providing $1 trillion in investments. Projects include highways, railroads, coal plants, thermal power plants, hydropower plants, nuclear power plants, electricity transmission systems, oil and gas pipelines, mining operations, and more.

GREENS CRITICIZE INTERIOR PLAN TO REOPEN CALIFORNIA LAND TO DRILLING: Environmental groups jumped Thursday on an Interior Department draft plan to reopen more than 1 million acres of federal land in central California to oil and gas drilling.

A Bureau of Land Management draft environmental impact statement would end a five-year-old moratorium on leasing on the land in Fresno, Kern, Kings, Madera, San Luis Obispo, Santa Barbara, Tulare, and Ventura counties

“Trump’s plan would unleash a fracking frenzy that puts California’s people and wildlife in harm’s way,” said Clare Lakewood, a senior attorney at the Center for Biological Diversity.

BLM has not issued an oil and gas lease in California since 2013, the group said.

DEMOCRATS AND REPUBLICANS ASK GAO FOR COST ESTIMATE OF TOXIC PFAS CLEAN UP: Democrat and Republican senators asked the Government Accountability Office on Thursday to assess the cost of cleaning up the toxic chemical known as PFAS.

Ron Johnson, R-Wisc., the chairman of the Homeland Security and Governmental Affairs Committee, joined with Tom Carper, D-Del., the ranking member of the Environment and Public Works Committee, in requesting the estimated costs for the federal government to clean up PFAS contamination. Gary Peters, D-Mich., the ranking member on the Homeland Security committee also joined in sending the letter.

Many of the sites with high levels of PFAS contamination are government facilities, like military bases, the letter to GAO explained.

The Rundown

New York Times EPA proposes weaker standards on chemicals contaminating drinking water

Reuters Going Dutch on clean energy? Polluters push for state to split the bill

Dallas Business Journal Lindsey Graham: ‘Climate change is real, the science is sound and solutions are available’

E&E News White House cracks down on agency use of science

Calendar

FRIDAY | April 26

9 a.m., Dallas. The EarthX environmental expo, April 26-28, kicks off in Texas, the largest environment and energy gathering. Former Trump climate adviser George David Banks will be addressing the expo’s energy conference, along with conservative clean energy advocates ClearPath, with Sen. Lindsay Graham, R-SC, opening the conference. Energy Secretary Rick Perry also announced he will be attending.

MONDAY | April 29

9 a.m., National Rural Electric Cooperative Association hold legislative conference with FERC Chairman Neil Chatterjee, DOE Assistant Secretary for Electricity Bruce Walker, Sen. Joe Manchin, D-W.Va., and Rep. Steny Hoyer, D-Md.

11:59 p.m., Deadline for submitting comments on EPA proposed rule to waive Reid vapor requirements to allow E15 fuels to be sold year round; and modifications to ethanol RIN credit market rules.

THURSDAY | May 2

10 a.m., 366 Dirksen. The Senate Energy and Natural Resources Committee holds a hearing to consider the following nominations: Daniel Jorjani to be solicitor of the Department of the Interior; and Mark Lee Greenblatt to be inspector general of the Department of the Interior.