WHAT’S HAPPENING TODAY: Good afternoon and happy Thursday, readers! In today’s Daily on Energy, Callie and Maydeen take a look at the drop in the price of oil as OPEC+ announced it would speed up plans to increase oil output. We also take a look at several bills introduced by House Republicans aimed at reversing California regulations to boost the electric vehicle industry.
Plus, keep reading for details on the Energy Department’s announcement on its plan to use federal land to develop AI-powered data centers.
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Welcome to Daily on Energy, written by Washington Examiner energy and environment writers Callie Patteson (@CalliePatteson) and Maydeen Merino (@MaydeenMerino). Email cpatteson@washingtonexaminer dot com or mmerino@washingtonexaminer dot com 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.
OIL PLUMMETS ON HIGHER-THAN EXPECTED OPEC+ OUTPUT HIKES: The price of oil crashed today, as OPEC+ announced this morning that it would be speeding up its planned increase in oil output by hiking production more than expected in May.
The details: Throughout early trading, both international and domestic benchmark oil prices had dropped by roughly $5 a barrel, with losses shrinking slightly in the afternoon. By around 2:30 pm EST Brent Crude was down $4.92, selling at $70.03 per barrel. West Texas Intermediate had dipped by $4.89 to $66.82 per barrel.
The plummeting prices appeared to be a response to Saudi Arabia, Russia, Iraq, UAE, Kuwait, Kazakhstan, Algeria, and Oman’s decision to increase oil production by 411,000 barrels a day starting in May. This is dramatically higher than the roughly 137,000 that had been anticipated. OPEC+ said that next month’s increase is “equivalent to three monthly increments.” The bloc said planned gradual increases may be “paused or reversed” at any time due to evolving market conditions in order for the group to best support “oil market stability.’
The oil-producing bloc started to gradually ease production cuts of around 2.2 million barrels a day this month after nearly six months of delays. The group is looking to fully recover the cuts by September 2026.
Following tariffs: OPEC+’s announcement comes just one day after President Donald Trump announced sweeping tariffs on dozens of countries. The energy sector was largely spared from the tariffs, which included a baseline 10% tariff on all exports to the United States, with minimal exceptions, and higher tariffs on nations with large trade surpluses with the U.S.
While the White House confirmed energy and energy products are exempt from these added tariffs, experts have said the new levies still spell trouble for the industry.
“It’s unquestionably a good thing that some of the energy market has been protected from the impact of these tariffs. But I think what it failed to account for is all the equipment and products that are necessary for the transportation and distribution of energy,” Josh Zive, a senior principal with Bracewell, told Callie.
“Whether you’re talking the steel that goes into the pipes or compressors that are used to move product, it often depends on international inputs, and so as a result, those inputs are still facing significant price uncertainties as a result of these tariffs,” Zive continued, warning that the market is bracing for energy prices to ultimately increase.
Read more from Callie here.
SENATE REVERSES ENERGY STANDARDS FOR WALK-IN COOLERS AND FREEZERS: Lawmakers in the Senate voted 53 to 42 on party lines to undo energy efficiency standards for walk-in coolers and freezers.
The bill reversed the Energy Department’s standards for walk-in coolers and freezers, which set requirements to limit the energy used by the appliances. It was sponsored by Republican Oklahoma Rep. Stephanie Bice. The House passed the resolution last week.
The bill was passed through the Congressional Review Act, allowing lawmakers to bypass the filibuster and take a simple majority vote in both chambers to cancel regulations. Once a CRA bill is passed and signed by the president, an agency cannot propose a similar bill in the future.
Republicans argue that energy efficiency regulations could increase costs for consumers and limit consumer choice. GOP-lawmakers in recent weeks have used the CRA to reverse a number of Biden-era energy regulations.
Bice’s resolution now heads to Trump’s desk to be signed into law.
Read more from Maydeen here.
IN OTHER NEWS FROM CONGRESS… House Republicans introduced three CRA bills aimed at undoing California regulations meant to boost the electric vehicle industry.
Regulations on the chopping block: Republicans will look to undo California’s rule to ban gas vehicles by 2035. Last year, the Environmental Protection Agency granted the state the authority to implement stricter vehicle emissions than federal requirements under the California Clean Act Waiver.
Lawmakers will also look to reverse a state regulation that implements nitrogen oxide engine emission standards for heavy-duty vehicles and undo another EPA waiver that allowed the state to require manufactures to increase the sale of zero-emission trucks.
Republicans have deemed these regulations “California EV mandates” as they force consumers to purchase battery-powered vehicles.
“The American people should choose what vehicle is right for them, not California bureaucrats. By submitting the three California waivers to Congress, Administrator Zeldin is ensuring that Congress has oversight of these major rules that impact every American,” said Energy and Commerce Committee Chairman Brett Guthrie.
TRUMP ADMINISTRATION MOVES FORWARD ON USING FEDERAL LANDS TO GET AHEAD IN AI RACE: In a bid to win the race with artificial intelligence, the Department of Energy has identified 16 sites on federal lands to further develop AI-powered data centers.
The details: This morning, the agency released a request for information to inform the possible use of thousands of acres of federal land for AI data center development. These projects would also be co-located with new energy infrastructure, guaranteeing Big Tech investors that the power these large load facilities demand would be available. Some of this new energy generation is expected to be advanced nuclear projects, like small modular reactors, that can come online quickly and be fast-tracked by the federal government.
“The global race for AI dominance is the next Manhattan project, and with President Trump’s leadership and the innovation of our National Labs, the United States can and will win,” Energy Secretary Chris Wright said in a statement.
The Department of Energy is currently seeking information and comments from data center developers, energy developers, and the general public to advance these potential co-located projects. The agency is looking to have the first sites operational by the end of 2027.
Biden’s footsteps: In today’s announcement, the agency said it was acting in accordance with the president’s executive orders on reducing barriers for AI development and unleashing American energy. However, it also comes just months after the Biden administration took similar steps to open up federal lands for data centers and energy infrastructure.
President Joe Biden’s executive order, issued on Jan. 14, directed the Secretaries of Energy and Defense to identify at least three sites on federal land managed by their agencies that would be suitable for the construction and operation of an AI data center and co-located energy facilities. The order also sought to see these facilities operational by the end of 2027.
DEADLY STORM HITS A NUMBER OF STATES: Tornadoes and strong winds ripped across Southern and Midwestern states, resulting in several deaths.
Tornadoes caused at least six deaths in Tennessee, Missouri, and Indiana. The tornadoes started Wednesday, moving into early this morning. AccuWeather said that the National Weather Service yesterday afternoon issued 728 tornadoes and thunderstorms warnings. The third highest number of warnings issued in a 24-hour period since 1986, the outlet said.
Forecasters predict historic rainfall to hit much of the central U.S. this weekend bringing high risks for flooding across the region. States like Arkansas, Kentucky, and Ohio could be affected by the thunderstorms.
“Should the amount of rain occur that we anticipate over the middle of the nation, it would exceed the 500 to 1,000-year average,” AccuWeather Senior Storm Warning Meteorologist William Clark said. “Truly, the potential is there for a historic flash flooding event.”
UK CLIMATE ADVISOR SAYS RICH PEOPLE SHOULD FLY LESS: Emma Pinchbeck, the CEO of the Climate Change Committee, said those with higher incomes should cut back on flying to ensure low-income families can vacation abroad, the Financial Times reported.
Pinchbeck said the committee, which advises parliament, said the government should protect the “annual family holiday to somewhere sunny like Spain.” She added that rich people should take one less flight to ensure low-income travellers could fly more.
The committee recently published a report calling for emission cuts by 2040. The report called for most of the emission cuts to come from consumers.
EUROPEAN UNION WEIGHS SOFTENING GAS STORAGE GOALS: Members of the European Union are reportedly negotiating whether to ease up on the bloc’s targets for gas storage later this year.
The details: A number of EU diplomats confirmed the discussions to Reuters this week, revealing that the bloc is looking at changing obligations for gas storage targets in 2026 and 2027. EU member states currently face a deadline of Nov. 1 in both years to fill their gas storage by 90% to ensure countries had a cushion of gas reserves before heading into that year’s winter season. However, the bloc may change that deadline to anytime between Oct. 1 and Dec. 1.
EU diplomats told Reuters that the bloc may even consider applying the change to this year’s November deadline, depending on when new rules can be finalized. The EU also has similar gas storage targets scheduled for February, May, July, and September. As it will likely take months for the bloc to come to an agreement on new rules before it can become law, November would be the first target affected.
Seeking flexibility: Members like Germany, France, and Netherlands have been leading the charge for softened rules, over concerns of market manipulation. Critics have claimed that as nations have been bound to these yearly targets, it opens the door for sellers to raise prices around these deadlines. In addition to softening the deadlines, some nations are pushing for the bloc to lower the storage threshold goals from 90% to 80%.
“We support less rigid storage level requirements,” a spokesperson for the German government told Bloomberg late last month. “More flexibility can ensure that the pressure to fill all gas storage facilities equally decreases and that market conditions normalize.”
ICYMI – FEDERAL REGULATORS EXTEND LIFE OF SOUTH CAROLINA NUCLEAR PLANT: The Nuclear Regulatory Commission has renewed the operating licenses for the Oconee Nuclear Station, allowing the power plant to remain open until the mid 2050s.
The details: The Oconee Nuclear Station, located in Seneca, South Carolina, roughly 140 miles Northwest of Columbia, has three pressurized water reactor units that have been in operation since 1973 and 1974. All U.S. nuclear facilities must receive operating licenses from the NRC, which limits original licenses to operate for 40 years. Facilities have the opportunity to renew their licenses, for an additional 20 years in each request.
The Oconee Nuclear Station first license renewal for its three reactors went into effect in 2013 and 2014, set to expire in the mid 2030s. On Monday, the NRC gave approval for a second license renewal request, extending the plant’s operations until 2053 and 2054 for a total of 80 years in operation.
About the power: With its three reactors, Oconee Nuclear Station generates more than 2,500 megawatts of energy, enough to power around 1.9 million homes. The nuclear facility is operated by Duke Energy, which runs and maintains a total of six nuclear plants.
These six nuclear plants make up more than 96% of the utility’s clean energy production, and support more than 50% of its customers’ electricity in both North and South Carolina. Duke Energy is also planning to seek license renewals for these other plants, starting with the Robinson Nuclear Plant in Hartsville, South Carolina, later this month.
CORRECTION: In yesterday’s newsletter, we misidentified Invenergy president and co-founder Jim Murphy’s title. We apologize for the mistake and have corrected it on the web version.
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