WHAT’S HAPPENING TODAY: Good afternoon and happy Wednesday readers! The complete Daily on Energy team is back in action today bringing you the latest from Energy Secretary Chris Wright’s testimony before the Senate and the Supreme Court’s latest pollution-related opinion. 

Debates over the Senate budget reconciliation proposal continue this week, and it’s clear the Republican Party is struggling to come to agreement. Conservatives in the House, like Texas Rep. Chip Roy, have vowed to vote against the current Senate proposal and called for strong cuts to clean energy tax credits. Meanwhile, other Republicans, like West Virginia Sen. Shelley Moore Capito, are asking leadership to be more lenient with regard to those same credits. We’ll be monitoring the situation closely over the coming days to see if the upper chamber is able to work together and get the legislation on the president’s desk by Independence Day. 

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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.

POWERING UP, TRUMP ADMIN LOOKS TO BUILD SMRS NEXT YEAR: The nuclear energy renaissance could be getting a jumpstart from the Trump administration, as it looks to have three small modular reactors built by next July. 

Energy Secretary Chris Wright revealed during a Senate hearing this morning that the Department of Energy is announcing a solicitation to get three SMRs built and producing power at the Idaho National Laboratory by July 4, 2026. 

This directly delivers on President Donald Trump’s executive orders aimed at boosting domestic nuclear energy development and would pave the way for using SMRs to power artificial intelligence advancements and data centers. 

What’s the catch? There has been limited progress made on deploying SMRs in recent years, as there are none operational in the U.S. and only three running around the globe. While SMRs are widely considered to be easier and faster to build, the regulatory approval process has remained fairly slow. The Nuclear Regulatory Commission has only given approval for two SMR designs, both to the same company – NuScale. 

To accelerate his agenda, Trump has taken action to reform the independent regulatory commission and even fired one member this week. 

Read more from Callie here.   

SCOTUS BACKS STATES IN EPA ‘GOOD NEIGHBOR’ CASE: The Supreme Court ruled that states can challenge the Environmental Protection Agency’s disapproval of pollution plans in regional courts instead of the D.C. Circuit Court. 

The high court ruled 8-0 siding with states that they can challenge the EPA’s disapproval of their “good neighbor” pollution plans. 

“The Court holds that EPA’s [state implementation plan] disapprovals were not based on any determination of nationwide scope or effect,” Justice Clarence Thomas wrote in the decision. 

The good neighbor rule, implemented in the Biden administration, is a provision under the Clean Air Act that is aimed at limiting out-of-state air pollution. The high court’s decision is a win for Utah, Oklahoma, and other red states that challenged the EPA’s rejection of state plans in 2023. 

Challenges to national regulations are typically heard in the U.S. Court of Appeals for the District of Columbia Circuit. But following the ruling, these cases can now also be in regional appellate courts located in Republican-led states. 

FIRST ESTIMATE OF RECOVERABLE OIL AND GAS UNDER PUBLIC LANDS IN DECADES RELEASED: For the first time in nearly 30 years, the Department of Interior’s U.S. Geological Survey has released an estimate of the amount of oil and natural gas that could be recovered and used to meet energy demands. 

The survey estimates that there are roughly 29.4 million barrels of oil and 291.6 trillion cubic feet of gas technically recoverable under federally managed public lands across the U.S. If 100% of this is recovered and produced, the agency said, it would be enough oil to meet the country’s current consumption needs for 4 years and enough gas to meet current needs for nearly 12 years. The last time the agency released a similar estimate was in 1998. 

The public lands debate: The updated USGS estimate comes as Congress weighs ordering the Departments of Interior and Agriculture to sell 0.5-0.75% of lands managed by the Bureau of Land Management and Forest Service. This could result in more than 3 million acres of public land being up for sale. 

It remains to be determined how much of the estimated recoverable oil and gas resources would fall under these currently protected lands. USGS officials told members of the press this afternoon that their report only broke down the estimates by state and geological provinces, and did not look closely at protected wilderness or park areas. 

The findings, though, could very well support the administration’s efforts to open more federal land for energy development. 

“We expect these estimates to be useful for state and national land management, energy futures analysis, and economic development planning,” USGS acting director Sarah Ryker said in a statement. 

EPA EFFORTS TO TERMINATE JUSTICE GRANTS WERE UNLAWFUL, JUDGE RULES: A federal judge yesterday ruled that the EPA’s effort to cancel millions of dollars in environmental justice grants is unlawful. 

In February, the EPA sought to terminate $600 million in environmental justice grants for 11 groups selected by Biden’s EPA Thriving Communities Grantmakers program to address pollution in low-income communities. Three nonprofit groups – the Green and Healthy Homes Initiative; the Minneapolis Foundation, and the Philanthropy Northwest – filed a lawsuit against the EPA’s termination. 

The program received funding from the Inflation Reduction Act, but the Trump administration has sought to end programs related to climate justice and diversity, equity, and inclusion (DEI). 

Judge Adam Abelson of the U.S. District Court for the District of Maryland ruled that the cancellation violated the Administrative Procedure Act. 

“EPA contends that it has authority to thumb its nose at Congress and refuse to comply with its directives. That constitutes a clear example of an agency acting “in excess of statutory jurisdiction, authority, or limitations, or short of statutory right,” and thereby violating the APA,” the judge wrote. 

The judge’s ruling comes as the EPA is battling in court to terminate funding from the Greenhouse Gas Reduction Fund, which the agency has claimed is rife with mismanagement and fraud. 

OIL PRICES DRIVEN BY GEOPOLITICAL RISKS: Higher oil prices seen in the last week won’t be sticking around for long, as analysts say that they are driven by a geopolitical risk premium that is likely to prove temporary. 

Norbert Rücker of Julius Baer said the conflict between Israel and Iran is “fluid,” emphasizing the importance of considering what has not yet happened. He added that energy infrastructure in the Persian Gulf remains untouched and the U.S. has not been fully pulled into the conflict. 

“This lack of escalation so far explains the surprisingly unemotional oil price reaction,” Rücker told the Wall Street Journal. 

As the conflict in the Middle East enters its sixth day, Trump has said his patience had “run out” after Iranian supreme leader, Ayatollah Ali Khamenei, declared Iran would not surrender.

Analysts said the market will remain quiet as long as the conflict remains contained. 

“How much U.S. participation is now priced in given Trump’s rather transparent comments on the subject remains to be seen,” analysts said. 

Where it sits: Just after 3 p.m. EST, both international and domestic benchmarks were up by nearly $10 compared to this time last week. Brent Crude was priced at around $76.74 per barrel and West Texas Intermediate was selling at roughly $75.19 per barrel. 

POLL SHOWS SUPPORT FOR OFFSHORE WIND TO POWER HIGH-TECH FACILITIES: New polling shows that Americans increasingly support wind energy as a tool to meet energy demand. 

Polling done by Tarrance Group shows that nearly 70% of Americans support new construction of offshore wind projects in their states. Also, almost 80% of respondents support more renewable energy to meet the growing energy demand from the rise of artificial intelligence and data centers. 

The poll comes as the Trump administration has taken action to halt offshore wind projects. 

“Offshore wind is a critical part of that vision, and it checks every box,” Turn Forward Executive Director Hillary Bright said. “It creates jobs, provides much needed energy at utility scale, and bolsters our nation’s self-reliance in an unpredictable world.”

The poll asked people in states like California, Connecticut, Louisiana, Maine, Maryland, Massachusetts, New Jersey, New York, North Carolina, Texas, and Virginia.

ICYMI – ALASKA STEPS CLOSER TO DRILL, BABY, DRILL: Yesterday, the Department of Interior announced it was taking action to support opening more than 80% of the National Petroleum Reserve in Alaska for oil and gas exploration and drilling, the latest effort from the administration to unleash the state’s resource potential. 

The department released a draft analysis for public comment that supported a plan which would open up to 82% of the 23-million-acre reserve for energy leasing and development. NPR-A, a roughly 23-million-acre area in Alaska’s North Slope Borough, was first set aside by President Warren Harding in 1923 as an emergency oil supply for the U.S. Navy. Jurisdiction of the land was transferred to the Interior Department in the 1970s, opening it up to oil and gas leasing.

Center of the debate: Alaska’s North Slope has remained central to the debate in Washington over increasing domestic energy production. Alaska Rep. Nick Begich told Callie this week that the region has become a “political football” for those within the environmental left that have opposed increased development. 

Typically, Begich said, the opposition seen around increased drilling in Alaska’s North Slope is from individuals who don’t live in Alaska and have never traveled to that region. Meanwhile, support has grown among Native tribes in the North Slope for energy development, as taxation on projects is tied to their economic growth. 

“It’s a great fundraising tool for those groups, but it, as a consequence, it hurts the state of Alaska, and it hurts the people in that region because it denies them access to resources that would make their life much more prosperous,” Begich said. 

RUNDOWN

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