WHAT’S HAPPENING TODAY: Good afternoon and happy Tuesday, readers! In today’s Daily on Energy, Callie and Maydeen take a look at the future of permitting reform in the new Congress, with key lawmakers indicating uncertainty on whether reform could fit into budget reconciliation.
We also take a look at how oil shipping rates have increased after the U.S. implemented sweeping sanctions on Russia’s energy sector last week due to the continuation of the war in Ukraine. Read on for the latest on the Los Angeles County wildfires.
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.
RECONCILIATION AND PERMITTING, WILL IT HAPPEN? THUNE AND WESTERMAN SPEAK: House and Senate Republicans may not be aligned as to whether permitting reform can make it into budget reconciliation as permitting reform remains top of mind for the new Congress.
The details: Senate Majority Leader John Thune and House Natural Resources Committee Chairman Bruce Westerman appeared at the American Petroleum’s State of Energy today, touting the party’s efforts to support the incoming administration’s energy agenda. While both lawmakers agreed that Congress has several tools it can use to boost energy security, it remains unclear where permitting reform fits.
Democrats and Republicans had failed to come to a deal on permitting reform in the final hours of the last Congress, with many disagreements surrounding changes to the National Environmental Policy Act. Republicans could pursue looping some reform into budget reconciliation, but Thune threw doubts on the possibility Tuesday.
“There are a lot of questions swirling about whether or not that is eligible for budget reconciliation,” the North Dakota Republican said. Reconciliation is limited to changes that affect spending or taxation.
Meanwhile, Westerman indicated there is a pathway available. When pressed on Thune’s remarks, Westerman told reporters that reconciliation will start in the House, giving Republicans the opportunity to make the case that permitting has a place in the budget. However, he noted he isn’t planning to push sweeping reform in the reconciliation package.
“When you talk about comprehensive permitting reform, I’m not saying we can put that in budget reconciliation, but I think there are certain parts of permitting or regulation in certain industries that fall both under the Natural Resource Committee and Energy Conference Committee that definitely have an impact,” he said.
A reminder: Last year, Westerman had introduced legislation primarily focused on reforming NEPA as both chambers had primarily discussed a reform bill put forward by Sen. Joe Manchin and Sen. John Barrasso. Westerman told reporters today that he would still prioritize changes to NEPA, calling it the “linchpin in permitting reform.”
“Nobody wants to do away with NEPA. We just want to make NEPA work and put some time restraints on it, put some judicial review restraints on it, and have a permitting process that does its job without hindering the economy,” he said.
HEINRICH CALLS ON LEE TO POSTPONE CHRIS WRIGHT’S NOMINATION HEARING: Energy Secretary nominee Chris Wright is scheduled to testify at his confirmation hearing tomorrow, but committee Democrats are calling for a postponement.
Sen. Martin Heinrich, the ranking member of the Energy and Natural Resources committee, along with several Democrat lawmakers, sent a letter to Chairman Mike Lee, requesting that he postpone tomorrow’s nomination hearing due to the committee having yet to receive the proper documents.
“The Committee still has not received the standard financial disclosure report, ethics agreement, or the opinions from the designated agency ethics officer and the Office of Government Ethics stating that the nominee is in compliance with the ethics laws, which are required by law of all nominees for positions that require Senate confirmation,” the lawmakers wrote.
The letter was signed by Democrat Sens. Ron Wyden, Maria Cantwell, Mazie Hirono, Catherine Cortez Masto, John Hickenlooper, Alex Padilla, Ruben Gallego, and Independent Sen. Angus King.
Last week, Heinrich accused Lee of not following protocol for the hearing for Interior secretary nominee Doug Burgum, which has been postponed to Thursday.
GERMANY LEANS ON OIL AMID SOARING ENERGY DEMAND: As demand for power in Germany has reached its highest level in nearly a year, the European country has been forced to rely on fossil fuels.
The details: Today, Germany’s oil generation jumped to the highest it’s been in over seven years, according to data compiled by Bloomberg. Gas electricity generation has also increased to its highest levels in two years.
As Germany and many of its European neighbors have increased their renewable fleet for their national grids, many are now having to lean on these fossil fuel energy sources as power demand continues to rise during the winter months.
The cost of power is also on the uptick, with day-ahead prices in Germany alone hitting €222.18 ($228.26) a megawatt-hour for tomorrow on the Epex Spot SE contract, per Bloomberg. In the last two years, that contract has hit above €200 a total of less than 10 times.
OIL SHIPPING RATES SURGE AS A RESULT OF U.S. SANCTIONS: Oil shipping rates increased following the U.S. implementing tough new sanctions on Russia’s energy sector last week.
Shipbrokers and traders told Reuters that supertanker freight rates increased and traders are seeking to book vessels to ship supply from other countries to China and India. Reuters added that Chinese and Indian refiners are seeking alternative fuel supplies after the new U.S. sanctions.
Last week, the U.S. Treasury Department announced new sanctions to target Russia’s revenue from oil that has been shipped through the “shadow fleet” of tankers, a fleet that has been used to avoid sanctions and redirect its oil to China or India. The sanctions target over 180 vessels apart from the dark fleet and two major Russian oil producers, Gazprom Neft and Surgutneftegas, as well as their subsidiaries.
Oil prices rose on the news of the sanctions, although they moderated Tuesday.
THE LATEST ON THE LOS ANGELES FIRES: Dangerously high winds returned to Los Angeles County today, raising the threat of new wildfires as firefighters continue to battle the current ones.
The National Weather Service said on X today that Southern California will see “dangerous fire weather conditions” until tomorrow. The forecasted winds are not expected to be as strong as last week’s winds, but the “combination of 20-40 mph offshore winds (with higher gusts) and low relative humidity (8-15%) will support rapid fire growth and potential for extreme fire behavior,” NWS said.
As of this morning, the Palisades Fire has burned 23,713 acres and is 17% contained. The Eaton fire has burned 14,117 acres and is 35% contained. The Hurst Fire has burned 799 acres and is 97% contained.
“Firefighters will continue to work tirelessly throughout the day to increase containment lines, to prevent further spread and address any flare-ups,” Los Angeles Fire Chief Kristin Crowley said Tuesday morning.
The death toll remains at 24 and there have been 35 missing people. More than 100,000 people have been displaced from their homes and more than 12,300 structures have been destroyed.
Yesterday, President Joe Biden pledged to give one-time payments to those who suffered losses from the wildfires. “People impacted by these fires are going to receive a one-time payment of $770, one-time payment, so they quickly purchase things like water, baby formula and prescriptions,” he said.
“FOREVER CHEMICALS” IN FERTILIZER COULD POSE RISKS: The Environmental Protection Agency today released a draft risk assessment finding there is human health risk associated with exposure to per- and polyfluoroalkyl substances (PFAS) chemicals in sewage sludge that is used as fertilizer.
PFAS, also known as “forever chemicals,” have been found in a range of consumer products, from cookware to clothing. The chemicals have been linked to health risks such as cancers and developmental effects.
The agency’s assessment looked at the population of people likely to be exposed by sewage sludge, such as farmers. The draft’s finding said that the risk for those exposed by the chemical likely exceeds the EPA’s thresholds. Farmers have raised concerns about contamination on their farmlands from using sewage sludge for fertilizers.
The preliminary findings could indicate future regulations on PFAS in sewage sludge.
“This draft assessment provides important information to help inform future actions by federal and state agencies as well as steps that wastewater systems, farmers and other stakeholders can take to protect people from PFAS exposure, while ensuring American industry keeps feeding and fueling our nation,” said EPA Acting Administrator Jane Nishida.
RUNDOWN
The Wall Street Journal The Race to Remove ‘Forever Chemicals’ from Clothing Ahead of Bans
Inside Climate News Building Decarbonization Could Push Out Low-Income Renters. A San Francisco Program Hopes to Prevent That
The New York Times U.S. Oil Production Is Booming. Oil Jobs Are Not.