Today’s Key Takeaways: Oil prices, broader operations, shareholder pressure are trends to watch in oil industry. Battle for future of oil and gas leasing in Gulf of Mexico escalating. Alaska’s new pipeline – copper? Centrist democrats push shift away from partisan initiatives in U.S. Senate.
NEWS OF THE DAY:
3 trends to watch with Big Oil
Mike Lee, ENERGYWIRE, February 9, 2022
Flush in cash, the oil industry is taking new directions on drilling, climate, renewables, and energy sources like hydrogen, according to earnings reports in the past week.
Big Oil finished 2021 on a roll, with high prices boosting companies’ profits for the full year, according to earnings reports released over the last two weeks.
The trend has brought some swagger back to the big U.S. producers, and to some extent to their European peers, after they collectively lost tens of billions of dollars during the coronavirus pandemic and the global recession.
Despite ongoing pressure from climate investors and net-zero emissions pledges, oil companies — particularly big U.S. producers like Exxon Mobil Corp., Chevron Corp., and ConocoPhillips — are arguing that the world will need oil and gas for decades.
“It’s becoming increasingly clear that the energy transition isn’t going to happen with the flip of a switch,” ConocoPhillips CEO Ryan Lance said on a call last week with analysts.
“The simple reality is that most alternative energy sources still have a long way to go toward becoming as scalable, reliable, affordable and accessible as the world needs them to be,” Lance said.
For European companies BP PLC and Shell PLC, which have invested aggressively in new forms of energy, high oil prices are providing a cushion that could help them through the transition. BP expects to grow its earnings from oil production through 2030, even as it focuses on other types of energy, CEO Bernard Looney said yesterday.
Oil prices broke over $90 a barrel last week. That’s the highest level since 2014, and it likely guarantees another profitable quarter for the oil producers. The high prices could influence global emissions because they give companies an incentive to keep drilling, even though companies say they’ll use higher profits to buy back shares and pay dividends.
But even as the companies talked about their recovery, they sounded notes of caution about the future during their conference calls with stock analysts.
The oil companies acknowledge that prices are likely to slide, and that the world will eventually move away from fossil fuels. They’re also under continuing pressure from investors to adapt to a climate-constrained world.
Here are three key trends shaping the industry:
1. High prices may not last forever
High oil and gas prices are likely to fade by the middle of the year, according to research from the Federal Reserve Bank of Dallas. Oil production will start to outstrip consumption, pushing prices down, the bank’s researchers said in a slide presentation this month.
Yet the oil companies are prepared for it. Chevron’s long-term plans include an assumption that international oil prices stay about $60 a barrel, and Wirth reaffirmed that during a call with analysts.
“Our longer-term view on the price environment hasn’t changed a lot,” Wirth said. “There’s a lot of resource out there that can be produced economically at prices lower than what we see today.”
That’s similar to Exxon CEO Darren Woods’ prediction, which he made last month in an interview with CNBC. Like a lot of oil producers, Exxon expected oil to rebound and then decline as the pandemic waned.
″We anticipated higher prices,” Woods told CNN in an interview last month. “We also anticipate a lot of volatility. And frankly, we’re anticipating lower prices as we go forward.”
The high prices have spurred more drilling, and the U.S. Energy Information Administration this week raised its prediction for U.S. oil output to 11.97 million barrels a day this year, up from 11.8 million barrels.
The companies are also keeping an eye on inflation in the prices of the supplies and services they rely on to keep their oil fields producing. The bulk of drilling, fracking and other work is handled by oil field service companies like Schlumberger and Halliburton, and they typically charge more for their work when oil prices rise.
Conoco and other producers try to offset those cost increases by making the rest of their operations more efficient. But Lance acknowledged in response to an analyst’s question that the company does have to pay more for some equipment and services.
“We are exposed, like most everybody is, to what you describe as spot condition or what’s happening in the service side of the industry,” he said.
2. Renewables, hydrogen, and carbon capture
Despite the improvement in their base oil business, the European companies are still pushing to convert themselves into broader operations that provide everything from wind power to hydrogen.
BP accelerated its plans to cut emissions from its operations, saying yesterday it would cut pollution from its own operations in half by 2030, compared to its previous goal of a 30 to 35 percent cut. The company also said it aims to eliminate all emissions from the products it sells by 2050, up from its previous goal of a 50 percent reduction.
That will entail a different type of business model — selling energy as a service in some cases, rather than as a commodity — and require different types of risks, Shell CEO Ben van Beurden said.
For instance, Shell and BP both plan to develop hydrogen as a source of fuel for trucks and other heavy equipment that can’t be easily electrified.
“Can we shape that market as it comes into being? What risks can we take as this market is building up?” van Beurden said. “What do we do with all this hydrogen before customers start showing up with their hydrogen trucks?”
The U.S. producers also are beginning to broaden their plans for new types of energy. Both Exxon and Chevron started low-carbon businesses in 2021, although they’re looking to invest in ideas like biofuels and carbon capture that are closer to their base businesses.
Exxon in January reorganized itself so that its low-carbon division is one of three primary business lines, next to its upstream (exploration) division and its combined refining and chemical division (Energywire, Feb. 1).
3. New shareholder pressure
Activist investors have helped push the industry toward greener investments, and that trend is likely to continue. They’ve attracted attention in Congress — the House Committee on Oversight and Reform began holding hearings this week on oil producers’ climate pledges (E&E Daily, Feb. 7).
Exxon, for instance, announced its low-carbon investment plans last year after a small investment fund, Engine No. 1, started a proxy campaign to replace some of the company’s board members.
The company is still being pressed by activists to show that it’s not risking shareholder money on investments that could lose value as the world shifts away from oil and gas.
“To date ExxonMobil has not provided information in its financial statements so investors can understand how it is managing these risks,” the Carbon Tracker Initiative said in a blog post this week. “It is therefore imperative that investors continue to press ExxonMobil to disclose the resilience of its business model under low-carbon scenarios.”
Exxon’s Woods didn’t address the shareholder activism directly in the company’s Feb. 1 call, but said policymakers are beginning to listen to the company’s long-standing argument that emissions reductions have to be balanced against the quality of life that low-cost energy provides.
“This is a really complicated space, and it deals with a really important part of people’s lives,” he said. “There’s a growing recognition and a growing acceptance of the need for a variety of approaches.”
Conoco is also facing a resolution from activists who want the company to cut or offset emissions from the products it sells. Vice President Dominic Macklon said the majority of Conoco’s investors don’t support the idea, and the company would prefer a carbon tax or some other price on carbon.
“That’s so important to address both the supply side, but so important, the demand side,” he said.
Other groups, including the Amsterdam-based group Follow This, are urging oil companies to set more aggressive decarbonization targets (Climatewire, Jan. 7).
Andrew Logan, at the sustainable investment group Ceres, said in a letter to the House committee that the industry as a whole needs to do more to clarify its plans. BP’s climate pledges, for instance, don’t include its 20 percent stake in the Russian oil producer Rosneft. Meanwhile, Shell “has outwardly committed to net zero goals … but lacks a reasonable road map to get there,” he wrote.
And companies across the board have been achieving their emissions targets by selling off older oil and gas fields, which only moves the emissions from one company to another.
“Investors have lost patience with the oil and gas industry,” Logan wrote.
From the Washington Examiner, Daily on Energy:
TENSIONS IN THE GULF: The battle for the future of oil and gas leasing in the Gulf of Mexico is escalating now that D.C. District Judge Rudolph Contreras blocked and sent back to the agency the Interior Department’s November lease sale.
The American Petroleum Institute, which intervened in the suit as a defendant, appealed Contreras’s ruling yesterday. Frank Macchiarola, the industry group’s vice president of policy, said the decision was “misguided” and creates uncertainty for producers at a time of high energy prices.
Meanwhile: Some 300 environmental and other advocacy groups are formally petitioning the Interior Department to immediately cease authorization of exploration plans and new drilling permits in the Gulf.
In an emergency petition sent to Interior yesterday, the groups expressed that Interior’s decision to carry on with the lease sale showed a “spectacular failure of climate leadership” and said the entire existing Gulf oil and gas leasing regime is illegal for relying on flawed environmental analyses that comply neither with the National Environmental Policy Act nor the Outer Continental Shelf Lands Act.
Authorization of new drilling “puts our climate, wildlife, and frontline communities at even greater risk from the numerous harms inherent in offshore oil and gas activities,” write the signatories, which include the Center for Biological Diversity, Sierra Club, and Friends of the Earth.
Hallie Templeton, Friends of the Earth’s legal director who has helped lead the group’s work against the sale, said in a statement that petitioners want President Joe Biden to “turn this ship around” and end offshore drilling.
Sale 257: The Gulf lease auction in November was the largest, in terms of total acreage, on record, and as the only one Interior conducted last year, it’s a perfect representative of the battle over energy between environmental groups and fossil fuel interests.
Moreover, the sale, to an extent almost unique unto itself, has driven a wedge between the Biden administration and some of these environmentalist and other liberal constituencies demanding more aggressive green energy policies than the administration is overseeing.
Macchiarola, on the other hand, called on the Interior Department to join its effort in appealing the decision, something that would seem to be highly unlikely considering the administration’s posture on why it held the sale at all.
Interior said after Contreras ruled that it was reviewing the decision but White House officials, speaking in recent weeks about the sale in light of criticism, maintained that the administration’s hand was forced by a court decision enjoining Biden’s moratorium on new oil and gas leases.
One final note: Laura Daniel-Davis, Biden’s nominee to be assistant secretary of the Interior for Land and Minerals Management, was grilled by Republicans on the Senate Energy and Natural Resources Committee yesterday about where she would take the agency if confirmed.
She said the department’s and its sub-agencies’ offshore work “to responsibly and safely develop energy resources on our Outer Continental Shelf helps assure our country’s energy independence and is critical to our energy future.”
Wave of U.S. LNG Ships Headed to Europe Sends Freight Rates Below Zero
Ann Koh, Bloomberg, February 8, 2022
- Spot charter rate in the Atlantic falls to -$750/day: Spark
- Diversions from Asia means too many LNG vessels in Atlantic
The cost to transport a shipment of U.S. liquefied natural gas to energy-starved Europe turned negative, a dramatic reversal that illustrates a growing glut of ships in the Atlantic ferrying American fuel.
Spot freight rates in the Atlantic crashed to -$750 per day on Tuesday, down from $273,000 in early December, according to Spark Commodities, which tracks LNG shipping prices. That’s the first time the marker has turned negative in Spark data going back to 2019 and means that — at least theoretically — owners are paying charterers to use their ships.
Hiring an LNG ship to send a U.S. cargo to Europe is negative for first time
LNG deliveries to Europe hit a record-high last month as traders redirected shipments toward the continent and away from Asia in order to take advantage of attractive spot prices. The enormous shift in trade flows has meant that there are now too many LNG vessels in the Atlantic Basin.
“If your vessels are going to Europe rather than Asia, the trip is much faster, so the ships get back sooner and are then ready to go again. This creates more availability in the system,” said Tim Mendelssohn, managing director of Spark. “There just aren’t enough charter requirements to keep these ships fully utilized.”
The negative rate “highlights how current vessel charter payments for the Atlantic Basin do not cover the fuel cost of ballasting the vessel back to the load port,” said Mendelssohn.
The surge in shipments to Europe has left fewer vessels available in Asia, with freight rates in the Pacific Basin at $16,250 per day on Tuesday, according to Spark.
The emerging new oil pipeline in Alaska
Shane Lasley, North of 60 Mining News, January 27, 2022
Goldman Sachs’ declaration that “copper is the new oil” may serve as a foreshadowing of Alaska’s economic future, one that is not so heavily reliant on the revenues from petroleum flowing from the North Slope and leans more heavily on the state’s rich endowment of precious, critical, and base metals.
The investment bank’s suggestion that copper is to become the strategically most important commodity on Earth is due to the vital role the conductive metal plays in global ambitions to phase out fossil fuel-burning automobiles in favor of electric vehicles charged with lower-carbon energy.
With the 2050 climate goals of the Paris Agreement serving as a waypoint, the vast majority of automotive companies and global governments have set 2035 as the target for a complete transition to electric vehicle sales.
The World Bank Group estimates that more than 3 billion tons of minerals and metals will be required to manufacture the EVs and low-carbon electrical generation to stay under the 2-degree Celsius temperature increase limit set by this global accord. This includes an estimated 550 million tons of copper for wind turbines, solar panels, EVS, and the wiring to connect them over the next 25 years, which is roughly equivalent to the total copper mined by humankind since the dawn of the Bronze Age, some 5,000 years ago.
As the demand for the metals needed to build this low-carbon future rapidly grows, the need for the petroleum that has been the stalwart of Alaska’s economy for the past half century is expected to decline.
“There is kind of the perfect storm brewing here,” Contango ORE Inc. President and CEO Rick Van Nieuwenhuyse told Mining News. “If the long-term view is to reduce our dependence on oil and gas, Alaska needs to start planning on what that future is going to look like.”
Fortunately, the state hosts a pipeline of world-class deposits of the minerals and metals needed to build the envisioned global low-carbon economy and diversify the state’s economic future.
With the opening of the Gil Mine on Kinross Gold Corp.’s Fort Knox property north of Fairbanks, Alaska now has seven large-scale mines producing gold, silver, zinc, lead, and coal. While copper stands out as a metal not being produced, this current omission belies the massive stores of this energy metal found across the Last Frontier – and several projects are set to begin delivering “new oil” into global markets in the coming years.
In addition, several Alaska projects in various stages of exploration and development are poised to deliver cobalt, graphite, rare earths, and other minerals expected to see massive new demand powered by increasingly ambitious targets for the phasing out of fossil fuel-burning automobiles in favor of EVs charged with green energy.
As the urgency for precious, base, and energy metals grows, so too does the interest in Alaska’s rich endowment of these metals.
While Alaska does not currently have a copper-producing mine, it is a past supplier of this critical electric conductor and has more than 30 million tons of the new oil in resources that are ready for delivery over the coming years and decades.
By far the largest deposit of copper in Alaska, and among the biggest in the world, is locked up in a long and drawn-out battle for regulatory approvals.
This world-class project is Pebble, which hosts 6.5 billion metric tons of measured and indicated resources averaging 0.4% (57 billion lb) copper, 0.34 g/t (71 million oz) gold, 240 ppm (3.4 billion lb) molybdenum, 1.7 g/t (345 million oz) silver, and 0.41 ppm (2.6 million kg) rhenium.
The Southwest Alaska deposit hosts another 25 billion lb of copper in the lower confidence inferred resource category.
A preliminary economic assessment published by Northern Dynasty Minerals Ltd. in 2021 outlines plans for a mine at Pebble that would produce an average of 320 million lb of copper; 363,000 oz of gold; 15 million lb of molybdenum; 1.8 million oz of silver; and 12,000 kilograms of rhenium annually over an initial 20 years of mining.
“The significant metal production forecasts and robust financial estimates … clearly suggest that Pebble is potentially more than just one of the greatest accumulations of copper and other strategic metals ever discovered on American soil,” said Northern Dynasty Minerals President and CEO Ron Thiessen. “It’s also a mineral resource that has the potential to sustain an environmentally sound and financially rewarding mining operation in the near-term and become one of America’s most important metals producers for decades to come.”
Even so, it would take around 170 of these Pebbles to meet the World Bank’s estimates on how much copper is demanded by the electric mobility and renewable energy sectors over roughly the same time frame.
Though Pebble is considered one of the largest undeveloped deposits of new oil on Earth, the project has been roiled in controversy due to its proximity to the Bristol Bay watershed and the world-class salmon fishery found there.
Proponents argue that a modern mine at Pebble could coexist with the fishery and deliver the copper and other metals the world needs. The opposition, however, says the Bristol Bay region is too unique to take a chance.
Toward the end of 2020, the U.S. Army Corps of Engineers denied the federal permits needed to move ahead with the development of a mine at Pebble expected to produce 5.74 billion lb of copper, 6.4 million oz of gold, 260 million lb of molybdenum, and 32 million oz of silver over a 20-year mine life.
Arguing that this decision is contrary to the law and the Army Corps’ own findings in the final environmental impact statement, Pebble Limited Partnership, the Alaska-based Northern Dynasty subsidiary advancing this world-class deposit, has appealed the federal agency’s record of decision.
“The FEIS found that the project can be developed without damage to the Bristol Bay fishery, a finding that was mostly ignored in the decision to deny Pebble a permit,” said Pebble Partnership CEO John Shively.
Ambler Mining District
Pebble is not the only advanced copper exploration project in Alaska that has healthy quantities of critical byproduct metals.
Not quite as large as Pebble but less controversial and much higher grade, the Arctic and Bornite deposits in the Ambler Mining District of Northwest Alaska host roughly 9 billion lb of copper, along with other base, precious, and critical minerals.
Ambler Metals LLC, a joint venture operating company equally owned by Trilogy Metals Inc. and South32 Ltd., is advancing the exploration, permitting, and future development of these and more than a dozen other copper-enriched projects across their Upper Kobuk Mineral Projects (UKMP).
Arctic, which is in the early stages of permitting, hosts roughly 2.5 billion lb of this copper.
A 2020 feasibility study for Arctic detailed plans for a mine that is slated to produce an average of more than 155 million lb of copper, 192 million lb of zinc, 32 million lb of lead, 32,165 oz of gold, and 3.4 million oz of silver per year over a 12-year mine life.
Budgeted at US$27 million, the 2021 exploration program at UKMP focused primarily on mission-critical metallurgical, geotechnical, and condemnation drilling needed for further engineering and permitting a mine at Arctic.
When it comes to copper, the Bornite project, about 16 miles southwest of Arctic, hosts the largest deposit discovered so far at UKMP.
According to the most recent resource calculation, Bornite hosts roughly 6.4 billion lb of copper and 77 million lb of cobalt, a critical metal used in the lithium-ion batteries powering EVs and storing intermittent wind and solar electricity.
Bornite also carries at least two other critical minerals – germanium and gallium – though the concentrations and recoverability of these technology metals have yet to be determined.
Ambler Metals currently envisions Bornite as the second mine to be developed at UKMP.
Arctic, Bornite, and several other potential mines in the larger Ambler District will require road access to be economically viable. Such a road to be built by the Alaska Industrial Development and Export Authority (AIDEA) and paid for by tolls collected from the transport of concentrates over the private industrial access received major federal permit approvals with the mid-2021 joint record of decision issued by the U.S. Army Corps of Engineers and Bureau of Land Management.
In addition to being a major milestone for UKMP, the road approvals bolster other projects along the route, including the Sun VMS project being advanced by Valhalla Metals and several projects recently being explored by South32 and Trilogy independently of their JV work in the Ambler district.
“Given our relationships and significant technical experience within the Ambler Mining District, we decided to stake some prospective ground in our backyard,” said Trilogy Metals President and CEO Tony Giardini said.
Alaska’s new oil pipeline
Besides Pebble and the Ambler District, Alaska hosts a pipeline of earlier staged projects that could deliver copper into global markets in the coming years.
Amongst the most advanced are the Palmer and Niblack VMS projects in Southeast Alaska.
Being advanced under a joint venture between Dowa Metals & Mining Alaska Ltd. and Constantine Metal Resources Ltd., the Palmer project at the north end of the Southeast Alaska Panhandle is an advanced mineral exploration project enriched with copper, zinc, silver, gold, and the critical mineral barite.
A 2019 preliminary economic assessment outlined plans for a 3,500-metric-ton-per-day mill at Palmer that would produce 1.07 billion lb of zinc, 196 million lb of copper, 18 million oz of silver, 91,000 oz of gold, and 2.89 million metric tons of barite over an initial 11-year mine life.
Budgeted at US$8.8 million, the 2021 program at Palmer primarily focused on geotechnical and environmental drilling to support a planned underground exploration program and feasibility-level studies for a future mine.
Blackwolf Copper and Gold Ltd.’s (formerly Heatherdale Resources) Niblack project at the southern end of the Southeast Alaska panhandle hosts a similar VMS deposit with 4.14 million metric tons of indicated resource averaging 0.95% (118.1 million lb) copper, 1.73% (215 million lb) zinc, 1.75 g/t (317,220 oz) gold, and 29.5 g/t (5.4 million oz) silver.
With new ideas brought by President and CEO Rob McLeod, Blackwolf Copper and Gold is expanding upon this resource with drilling that cut much wider intervals than previous modeling had predicted, with remarkably consistent polymetallic grades.
Based on 2021 drill results that exceeded expectations, McLeod said “Blackwolf has decided to initiate a significant upgrade of site facilities including camp, fuel storage, underground support and core processing that can accommodate greatly expanded programs at Niblack.”
PolarX Ltd.’s Caribou Dome is another copper enriched project where 2021 drilling exceeded expectations.
Part of PolarX’ larger Alaska Range property, Caribou Dome hosts 2.8 million metric tons of combined measured, indicated, and inferred resources averaging 3.1% (189.6 million pounds) copper in nine lenses of volcanic sediment-hosted mineralization.
Three out of four holes testing coincident geophysical and geochemical anomalies outside the resource area cut native copper that indicates the high-grade copper at Caribou Dome could be much more prevalent than previously known.
“This discovery is a potential game-changer for PolarX because the same volcanic host rocks, along with multiple IP (geophysical) and geochemical targets, are widespread at Caribou Dome, meaning the exploration upside here is immense,” said PolarX Managing Director Frazer Tabeart. “With copper being such an important metal for the green energy transition, we’re increasingly well placed to play a role in this market.”
In addition to testing potential expansion of the high-grade copper resource at Caribou Dome, the 2021 program included drilling into known massive sulfide lenses to collect fresh samples for metallurgical testing to support a scoping study on the potential of processing ore from Caribou Dome in combination with ore mined from the high-grade Zackly copper-gold project about 15 miles (nine kilometers) to the northeast.
Based on drilling by PolarX and previous explorers, Zackly Main hosts 3.4 million metric tons of Australian Joint Ore Reserves Committee- (JORC) compliant inferred resource averaging 1.2% (90.4 million lb) copper, 2 grams per metric ton (213,000 oz) gold, and 14 g/t (1.5 million oz) silver.
While smaller in terms of the potential to supply global demands, projects like Caribou Dome-Zackly, Niblack, and Palmer have the advantage of being nimble enough to potentially be near- to medium-term sources of copper for a world that is rapidly transitioning to electrified transportation and zero-carbon energy.
Kenorland Minerals Ltd.’s Tanacross project in eastern Alaska and the Round Top deposit on Western Alaska Minerals’ Illinois Creek project in the western part of the state host earlier stage porphyry copper deposits that offer the potential to add to the reserves of new oil in Alaska over the longer term.
Senate Democrats shift strategy after progressive agenda falters
Alexander Bolton, The Hill, February 9, 2022
Senate Democratic moderates are urging their leadership to tack to the center by moving bills to the floor that can pass with strong Republican support, but it’s creating tension with liberals who don’t want to abandon the core components of Build Back Better, voting rights legislation and other progressive priorities.
Senate Majority Leader Charles Schumer (D-N.Y.) appears to have heard the message from moderates in his caucus loud and clear.
This week, Schumer is stressing plans to vote on legislation that has bipartisan support, such as ending the use of forced arbitration clauses to avoid sexual harassment and assault lawsuits, a bill to strengthen the nation’s cybersecurity infrastructure and a measure to improve U.S. competitiveness with China.
“We’re gearing up to have a productive couple of weeks,” Schumer announced at a press conference at which he and his colleagues highlighted those bills.
The shift away from partisan initiatives that occupied the Senate’s time and attention last month and the end of last year — filibuster reform, voting rights legislation and Build Back Better — comes after centrist Democrats made clear that they wanted to focus on more bipartisan legislation.
Democrats in both chambers of Congress are growing more anxious about the midterm elections in November. Political handicappers expect the House to flip to the GOP, while control of the Senate is more of a toss-up.
“We’ve tried on Build Back Better to go our separate ways, do it through reconciliation, fell short. We tried to go our separate ways, get something done with respect to voting rights and protecting them, and we’ve fallen short,” said Sen. Tom Carper (D-Del.), a longtime ally of President Biden’s.
Carper said the desire among Democrats and Republicans to shift away from purely partisan initiatives to bills that had more likelihood of passing with bipartisan support is “almost palpable.”
“I can feel it in both caucuses,” he said, adding that colleagues “are beginning to yearn for, like, ‘Let’s try to work together on some stuff and get some things done.’”
“We showed what we can do on infrastructure,” he added, referring to the $1 trillion bipartisan infrastructure bill that passed the Senate last year by a vote of 69-30.
“There’s a real hunger for that now,” he said of the desire among moderate Democrats to start working more with Republicans. “I’m interested in finding what works and getting stuff done.”
Sen. Chris Coons (D-Del.), a Biden surrogate on the 2020 campaign trail, said, “I think we can and should do bipartisan legislation.”
“There are a number of bills that are ready to move,” he said, citing a reauthorization of the Violence Against Women Act and the bipartisan Recovering America’s Wildlife Act.
Coons also highlighted negotiations on an omnibus spending package and legislation to improve U.S. competitiveness and bolster the domestic semiconductor manufacturing industry as top near-term priorities.
Bipartisan postal reform legislation is another bill that several Democratic senators are now touting.
Schumer’s allies say the focus on bipartisan legislation over the next several weeks dovetails with the pledge he made shortly after Democrats won the Senate majority to pursue bipartisanship wherever possible.
Democrats note that former President Trump’s second impeachment trial was bipartisan, as seven Republicans voted to convict him on a charge of inciting insurrection.
The Senate also passed a bill combating hate crimes against Asians and the U.S. Innovation and Competition Act with bipartisan majorities last year.
But some liberal Democratic caucus members aren’t happy about leaving Biden’s climate and social spending agenda in limbo while their colleagues ramp up work on passing less ambitious bills with Republican support.
“I think we have legislation that is enormously popular, which meets the needs of working families, and I think we’ve got to stay on it as aggressively as we can,” said Sen. Bernie Sanders (I-Vt.).
Sen. Elizabeth Warren (D-Mass.) said that “the big pieces are still there in Build Back Better,” which she called “an ongoing issue right now.”
“I don’t think we’ve ever entirely left it,” she said.
Several Senate progressives are discussing the possibility of breaking up their sweeping election reform bill, the For the People Act, into smaller pieces that could be brought to the floor for votes.
However, many Democratic senators were left with a bitter taste in their mouths after spending most of the fall working on Build Back Better only to fail to pass a bill because Sen. Joe Manchin (D-W.Va.) refused to support it.
They were also left frustrated by the weeks spent working on filibuster reform and voting rights legislation, which predictably came up short on the Senate floor. That has left Democrats up for reelection with fewer accomplishments under their belt than they want heading into what is expected to be a tough midterm election.
Schumer, who is up for reelection this year, signaled to colleagues that he’s aware of their frustration over the inability to move major priorities with only 51 votes.
Speaking to colleagues on the Senate floor Monday, Schumer emphasized that “there are numerous good proposals that we can address here in the Senate on a bipartisan basis.”
The Democratic leader has made no recent mention of holding a vote on Build Back Better, Biden’s sweeping climate and social spending bill, which Manchin effectively blew up when he told “Fox News Sunday” in December: “I cannot vote to continue with this piece of legislation.”
Schumer pledged then to bring the massive bill up for a vote anyway, to put Manchin and others on the record.
“Senators should be aware that the Senate will, in fact, consider the Build Back Better Act, very early in the new year so that every member of this body has the opportunity to make their position known on the Senate floor, not just on television,” he wrote in a Dec. 20 “Dear Colleague” letter.
Seven weeks later, however, Schumer is showing little desire to ratchet up pressure on Manchin by forcing him to vote on Build Back Better.
Manchin on Tuesday said he’s ready to pivot to bipartisan measures, such as an overhaul of the Electoral Count Act of 1887 that he is working on with Sen. Susan Collins (R-Maine) and Sen. Lisa Murkowski (R-Alaska).
“Hopefully, we’re going to bring the bipartisan bill of fixing the Electoral Count Act,” he said. “Hopefully within a couple weeks we can get that one ready.”
Manchin said he’s not eager to revive the debate over Build Back Better.
“I’d like to think we never want to get back to that. You can’t do it when you have a divided Congress, and you got a country that’s being split apart. We need to bring it back together,” he said.
Utilities’ climate goals have little impact on emissions
U.S. carbon dioxide emissions would be 12% lower by 2050 if electric utility companies achieve their climate goals compared to a business as usual scenario, according to a new report by the U.S. Energy Information Administration (EIA).
Utilities have been at the forefront of a corporate-wide move in pledging new goals to slash carbon emissions. But many of these goals lack integrity, according to a new study by the NewClimate Institute.
Although 12% isn’t nothing, it’s also a far cry from zero emissions, which is where the entire U.S. economy needs to be by 2050 if the world is to meet goals in line with the Paris Climate Agreement.
That limited emissions reduction reflects the fact that although corporate goals are important, more systemic change is needed, likely prodded by government policy.
Overall CO2 emissions from the energy sector would be just 3% lower by 2050 with these corporate goals achieved.
Such a small reduction reflects the fact that the electricity sector accounts for just a quarter of U.S. emissions.
A primary factor driving the 12% reduction in electricity emissions is utilities’ plans to keep operating nuclear power plants.
“This outcome occurs in part because our model identifies existing nuclear generation as being among the lowest-cost options for meeting clean energy or carbon-reduction goals. Existing nuclear plants typically have operation and maintenance costs that are less than the cost of building new low-carbon capacity.”
— U.S. Energy Information Administration
The reference case EIA is comparing the corporate goals against reflects current laws and regulations, including state-level mandates for renewable and zero-emitting electricity.