WHAT’S HAPPENING TODAY: Good afternoon and happy Friday, readers! As we wrap up another week, today’s edition of Daily on Energy highlights a top oil executive’s concerns over where prices have been teetering in recent days.
Support is growing for the preservation of the Department of Energy’s Loan Programs Office, with one staunch Republican governor calling on Washington to use the office to boost nuclear energy development in the U.S.
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Plus, President Donald Trump is poised to sign a bill that would overturn the Energy Department’s efficiency rules for commercial refrigerators, freezers, and refrigerator-freezers this afternoon.
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.
QUOTE OF THE WEEK: Diamondback Energy, the largest oil producer in the Permian Basin, is predicting that U.S. shale production has peaked as prices have dropped.
“We have a very good view of what the U.S. looks like. And right now that’s a business that’s slowing dramatically and likely declining in terms of production,” Diamondback Energy CEO Travis Stice said on the company’s earnings call.
“We know a lot of people in the business,” Stice told analysts. “Every single conversation I’ve had with … operators is that this oil price doesn’t work.”
SUPPORT FOR ENERGY DEPARTMENT’S LOAN PROGRAMS OFFICE GROWS AMONG CONSERVATIVE LEADERS: More conservatives have spoken in favor of the Department of Energy’s Loan Programs Office, with staunch Republicans like South Carolina Gov. Henry McMaster calling on Washington to utilize the office to fuel domestic nuclear energy development.
The details: McMaster sent a letter to the Congressional delegation of South Carolina this morning, saying the state is at risk of losing a “historic opportunity” amid nuclear energy’s revival in the U.S. He pointed to the need for federal support in order to restart construction of two nuclear reactors that was halted more than seven years ago.
The reactors are located at the V.C. Summer Nuclear Station, which currently has one reactor in operation. Utility company Santee Cooper announced earlier this year its intent to restart construction of the other two reactors, something that can’t be done without federal loans or subsidies, McMaster said.
“I will soon sign S. 51, legislation dealing with Santee Cooper’s current effort to gauge the
feasibility of finishing nuclear reactors (#2 and #3) at the V.C. Summer Nuclear Station in
Jenkinsville,” McMaster wrote. “But without the existing federal tax credits and loan programs for nuclear power that make financing new nuclear power generation possible, our efforts to finish V.C. Summer are dead. And Congress is on the edge of eliminating them in budget reconciliation.”
The Republican governor is specifically asking Congress to preserve clean-electricity- and nuclear-focused tax credits like 45U, 45Y, and 48E, as well as the LPO’s infrastructure reinvestment program. Not only will this help support construction of the two reactors, McMaster said, it will encourage billions of dollars of private investment as well.
The governor’s letter is the latest call to lawmakers and administration officials to protect the LPO in order to deliver on the Trump administration’s energy agenda. Dozens of policy think tanks, clean energy companies, and nuclear energy firms, as well as employees inside the department, have called the LPO vital to funding and supporting new energy projects.
Some background: McMaster’s plea comes just days after Energy Secretary Chris Wright told members of the House Appropriations Committee that he intended to use the LPO for nuclear energy development. Wright testified before the Subcommittee on Energy and Water Development on Wednesday saying DOE will utilize grants from the Nuclear Energy Office and the LPO to provide capital for the nuclear industry. He emphasized, though, that the majority of the money going into the industry will need to be private.
“There will be government capital, as you’re well aware of, there’ll be government loans and loan guarantees, and they’ll be catalyzing regulatory events to bring that private capital in,” Wright said.
TRUMP TO SIGN REPEAL OF RULES ON COMMERCIAL REFRIGERATORS AND FREEZERS: A White House official confirmed to the Washington Examiner that President Donald Trump will sign into law a Congressional Review Act resolution that would overturn the Energy Department’s efficiency rules for commercial refrigerators, freezers, and refrigerator-freezers.
The bill was introduced by Texas Rep. Craig Goldman and Florida Sen. Ashley Moody. The Republicans introduced the bill through the CRA, which allows Congress to bypass the filibuster and vote in a simple majority to repeal a regulation. Once a CRA bill is signed into law, the agency cannot propose a similar rule in the future.
Goldman told Maydeen that Biden’s DOE rule is yet another example of the “government getting involved in an area of American people’s lives that they should not be in.”
He added that when the government mandates how commercial refrigerators are made, it is interfering with the market and results in higher prices for businesses, which will end up falling on the consumer.
“The last thing we need is for prices to increase when the government mandates how certain things can be or should be made,” Goldman said.
GOP lawmakers have used this legislative tool in an effort to repeal former President Joe Biden energy and climate regulations that are not aligned with the current administration’s agenda. Trump has signed five CRA resolutions.
Republicans argue that energy efficiency regulations on appliances limit consumer choice and raise costs.
TRUMP FIRES CONSUMER WATCHDOG WHO FLOATED GAS STOVE BAN: In other consumer choice news, the president has fired three Democrats serving on the Consumer Product Safety Commission, including the man who triggered political controversy over a potential ban of gas stoves.
Following a visit to the agency by the Department of Government Efficiency on Thursday, the administration axed former chairman Alex Hoehn-Saric, Mary Boyle and Richard L. Trumka Jr.
The proposed gas ban: Trumka was tapped to serve as CPSC commissioner by President Joe Biden in July 2021. His time in the seat was swiftly marred by his suggestions that the five-member commission was considering a ban on gas stoves due to health hazards – a suggestion the chairman was later forced to walk back.
Ahead of a commission meeting in October 2022, Trumka moved to propose that CPSC begin rulemaking to regulate gas stoves. His proposal did not receive any support from the other four commissioners, forcing him to retract the amendment. Despite the lack of support, Trumka continued on his campaign.
In December of the same year, Trumka told reporters that a ban on natural gas stoves was a “real possibility” and in January 2023 he told Bloomberg “any option is on the table” to regulate the household appliance. As his remarks sparked uproar among Republicans, then-chairman Hoehn-Saric publicly stated the commission had no plans to ban gas stoves.
Standing ground: In a statement released today, Trumka said he intends to complete his term on the commission, which runs through October 2028. He said he did not know why he was fired but suggested it was because he voted in favor of making flammable lithium-ion batteries safe.
“The President would like to end this nation’s long history of independent agencies, so he’s chosen to ignore the law and pretend independence doesn’t exist. I’ll see him in court,” Trumka said.
BRITAIN BOOSTS OFFSHORE WIND BONUS AS INDUSTRY SUFFERS BIG BLOW: The United Kingdom is more than doubling the amount of funding available under its “Clean Industry Bonus” program focused on supporting offshore wind development.
The details: The U.K. government announced today that it would be increasing the bonus from its initial £200 million to £544 million (roughly $265 million to $722 million). This program is aimed at developers and investors prioritizing projects in regions in need of cleaner supply chains, such as those who have traditionally relied on oil and gas. The government said today that it increased the bonus due to “higher than expected demand.”
“Industry have backed our clean energy superpower mission, and we are helping them to deliver it,” Energy Secretary Ed Miliband said in a statement. “This is the type of muscular industrial policy Britain needs to create jobs, drive growth and transform the fortunes of industrial towns and cities, delivering our Plan for Change.”
Some background: Offshore wind has remained at the center of the government’s clean energy targets, including having a power grid made of 95% low-carbon energy by 2030. Many have begun to speculate whether that is possible, as Danish wind developer Ørsted canceled plans to construct a 2.4 gigawatt offshore wind farm earlier this week. The company said the project no longer made economic sense due to increased supply chain costs, higher interest rates and increased execution risk. It has yet to be seen if other projects will suffer a similar fate or if the increased bonus will improve financial viability.
ALUMINUM SECTOR IS NOT MOVING TO THE U.S. DESPITE TARIFFS: Trump has imposed sweeping tariffs in an effort to move production back to the U.S., including the aluminum sector, but high electricity costs are undermining the effort, CNBC reports.
A CNBC analysis found that rising costs, particularly for electricity, are leading to factory closures rather than openings. The impact on the aluminum sector is “starkly visible,” CNBC said.
Trump has imposed 25% tariffs on imports of aluminum, including those from Canada, which is the U.S. largest supplier of aluminum. Since then, the price of aluminum has risen up to 60%.
Trond Olaf Christophersen, the chief financial officer of Norway-based Hydro, one of the world’s largest aluminum producers, told CNBC that “It’s very likely that this will end up as higher prices for U.S. consumers.”
ICYMI – REWIRING AMERICA LAYS OFF WORKERS, CITING EPA’S HOLD ON BILLIONS IN GRANT MONEY: Rewiring America has announced it will lay off 28% of its workers, citing the Environmental Protection Agency’s hold on billions of dollars in grant money.
Rewiring America is a nonprofit group that works on electrifying homes. It is also a coalition member of Power Forward Communities, a green group that was picked to receive grant money from Biden’s EPA Greenhouse Gas Reduction program. The program provided billions for groups like Power Forward Communities to invest in green projects across the nation.
However, EPA Administrator Lee Zeldin has sought to defund the program, claiming that it was mismanaged by the Biden administration, which routed the grant money through Citibank. The EPA blocked the disbursement of the money held by Citibank, sparking litigation from Power Forward Communities and other grantees, including Climate United and Coalition for Green Capital.
During the ensuing legal battle, the Greenhouse Gas Reduction Fund money has been frozen in Citibank and grantees have yet to receive their promised funding.
“[W]e will continue defending our rights in court and fight optimistically to victory. But, unfortunately, we are now forced to act financially as though the GGRF award does not exist,” CEO of Rewiring America, Ari Matusiak wrote. “Because we are not able to access our funds, we will adjust expenses accordingly in order to become more resilient, not more vulnerable, with each passing month.”
Recently, the EPA has appealed and a hearing is set for later this month.
ICYMI – FEMA CHIEF FIRED AFTER ADVOCATING FOR AGENCY BEFORE CONGRESS: The acting administrator of the Federal Emergency Management Agency, Cameron Hamilton, has been fired from his role after telling Congress he did not believe it was in the American people’s interests to slash the agency.
The details: The Department of Homeland Security confirmed to the Washington Examiner early yesterday afternoon that Hamilton was no longer the head of FEMA, hours after he had posted on X that he was looking forward to the continued work in that post.
His firing came one day after Hamilton told House lawmakers on the appropriations committee for homeland security that he did not believe the agency should be abolished – a break from Trump, who has called for the agency’s dismantling.
During the hearing, Connecticut Democratic Rep. Rosa DeLauro asked Hamilton whether the Trump administration planned to eliminate FEMA and whether he believed it ought to be dismantled. Hamilton responded by saying FEMA was necessary and could not be replaced by state efforts.
“As the senior adviser to the president on disasters and emergency management and to the secretary of homeland security, I do not believe it is in the best interest of the American people to eliminate the Federal Emergency Management Agency,” Hamilton said. “Having said that, I am not in a position to make decisions and impact outcomes.”
Read more from the Examiner’s Anna Giaritelli and Naomi Lim here.
RUNDOWN
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