NEWS OF THE DAY:
Six moderate Democrats raise concerns about spending bill’s energy measures
Rachel Frazin, The Hill, September 13, 2021
Six moderate Democrats are raising concerns about the energy provisions put forth by their colleagues as part of a $3.5 trillion spending package.
In a new letter to House leadership, Reps. Henry Cuellar, Vicente Gonzalez, Lizzie Fletcher, Sylvia Garcia, Marc Veasey, Filemon Vela and Colin Allred criticized policies from their colleagues that are “targeting the U.S. oil, natural gas, and refining industries.”
“We firmly believe that the budget reconciliation bill should not unduly disadvantage any industry, and oppose the targeting of U.S. oil, natural gas, and refining with increased taxes and fees and the exclusion of natural gas production from clean energy initiatives,” wrote the lawmakers, all of whom represent districts in Texas.
“These inequitable policies will cost American jobs, move America farther away from energy independence, and will slow the country’s move toward a lower carbon future,” they added.
Their letter comes as Democrats hold slim majorities in both chambers and struggle to keep their coalition together in support of their spending proposal.
In the Senate, Democrats can’t have any defectors, while in the House, they hold an eight-vote majority.
Recently, a group of nine lawmakers, including Cuellar, Gonzalez, and Vela, expressed reservations about the two-track system for the bipartisan and Democratic-only spending bills.
Among proposals pushed by Democrats are a methane fee on pollution from the oil and gas industry and increased payments for drilling on public lands.
Another major policy is known as a Clean Electricity Performance Program, which would pay or penalize power providers in order to shift the country toward clean electricity. The House version of this program, unveiled last week, would exclude natural gas unless it doesn’t use technology to capture its emissions.
Sen. Joe Manchin (D-W.Va.) also expressed opposition to this program over the weekend, saying that “it makes no sense at all” and arguing that senators should not place incentives toward a place where the market is already going.
Oil and gas are less carbon intensive than coal, but their production and use still contribute planet-warming emissions to the atmosphere.
OIL:
Norway’s center-left Labour begins coalition talks as anti-oil Greens sidelined
Ivana Kottasová, CNN, September 14, 2021
Norway’s main opposition Labour Party is beginning coalition talks to form a government Tuesday after the ruling Conservatives lost their command in parliamentary elections and the anti-oil Greens failed to win enough seats to become the potential kingmaker.
Labour is likely to form an alliance with the country’s Center Party and the Socialist Left Party, following an election campaign period heavily focused on the climate crisis and the future of the country’s lucrative oil industry. Though it has not ruled out talks with the Greens, the only party calling for a complete end to fossil fuel exploration.
Norway is Europe’s second-biggest oil-producing nation, after Russia, and the world’s third-biggest natural gas exporter. Even with political will, phasing out fossil fuels was unlikely to be quick.
But the future of fossil fuels in the country became a hot-button issue in the election period, as oil contributes significantly to the nation’s wealth but sits at odds with Norway’s other credentials as a global climate leader.
The results unseat Prime Minister Erna Solberg, who after eight years of rule became Norway’s longest-serving Conservative leader. Solberg has refused to put an end date on fossil fuel production, planning for its continuation beyond 2050.
But her ouster wasn’t the boon for climate some had projected. Polling ahead of the election and early results had suggested the Greens would win enough seats to force Labour to accept it in its coalition.
Labour leader Jonas Gahr Støre, a former foreign minister, is seen generally as a pro-oil figure. His party is supporting the continued production of oil, although it has indicated new exploration should be limited.
But after more results came in overnight, the Greens’ hopes for gains had evaporated, and by Tuesday morning, the party appeared to have lost its position as an obvious member of the coalition.
In remarks to party supporters, Støre said that he would invite leaders of “all parties who want a change” to come forward for talks.
Labour leader Jonas Gahr Støre, center, surrounded by security guards and journalists in the early hours of Tuesday.
“It is natural to start with the Center Party and SV [Socialists], our preferred partners,” he said, adding he would also “listen” to the Greens and Reds, another smaller socialist party.
“In this election, the Labour Party had a goal that was more important than anything other than a new government, a change in Norway after eight years of right-wing politics and increased differences, a government based on community and justice so that it is the turn of ordinary people.”
Støre appeared to target the other key election issue of inequality over climate, saying that his government would pursue a policy for a “fairer Norway with less differences.”
He also said that his government would pursue “a fair climate policy that cuts emissions and creates jobs,” and that “take the sides of ordinary people,” including “young people who demand that we do everything in our power to save the Earth from the climate crisis.”
According to a full preliminary count of the vote, Labour secured some 26% of the ballots, which translates to 48 seats in the 169-seat parliament. The Eurosceptic Progress Party came in third but is an unlikely Labour ally.
The smaller Center Party and the Socialist Left Party gained 28 and 13 seats, respectively. The Greens ended with just three seats, two more than it already had.
The results will be made official when a final count is completed.
A climate paradox
The Socialists have a stronger climate agenda than Labour, so they could still have some influence over the country’s future energy policies.
Lars-Henrik Paarup Michelsen, the director of the Norwegian Climate Foundation, said Labour needed the support of at least one green party to achieve command of parliament.
Despite the results, he said, the elections had but the climate crisis more firmly in public debate and on the government’s agenda.
“Everyone expects that climate policy will be tightened after the election,” he added.
But Fay Farstad, a senior researcher at CICERO, a Norwegian institute for interdisciplinary climate research, said the gains posted by the Center Party indicate the debate around oil is not so clear cut.
“They support Norway’s climate goals and agreements, but where they differ is on the issue on CO2 tax increases. They ran on the platform of rejecting it,” she said.
Norwegians enjoy a high standard of living by many measures, largely because of its $1.1 trillion sovereign wealth fund — the biggest in the world — which invests revenues from the oil industry. Its website displays a real-time value of the fund, so Norwegians can marvel at their seemingly ever-growing riches.
The country’s approach to the climate crisis has been paradoxical for some time. The oil and gas sector remains crucial for the Norwegian economy, employing 200,000 people — between 6% and 7% of its workforce — and accounting for 14% of GDP and 41% of exports.
The Norwegian Petroleum Directorate said earlier this year that it expected oil production to keep rising in the next few years, from 1.7 million barrels a day in 2020 to just over 2 million a day in 2025.
But it has also pledged to become carbon neutral by 2030, way ahead of many other rich countries. The US, UK and the EU are all hoping to achieve net zero by mid-century. The country is also offering generous subsidies for electric cars and investing heavily into renewable energy sources.
“There have been many debates over the course of the last year and a half or two years, but when the [UN] report came in August, just as the campaign was picking up steam, it really did put climate change at the center of attention,” Ole Jacob Sending, director of research at the Norwegian Institute of International Affairs think tank, told CNN.
The UN report found that climate change was happening faster than scientists previously thought and was published as much of the Northern Hemisphere battled heatwaves, wildfires, and flooding. In Norway, a country that generally experiences cooler climes, was scorched in parts by a heatwave during the summer.
While climate change itself is not up for a debate in Norway — all of the main political parties acknowledge climate change is real and already happening — the question of how to handle it is.
“Climate is now one of the main fault lines in Norwegian politics … there are disagreements on what are the best policies and how urgent is it that we take action,” Sending said.
“It’s less of an elephant in the room now … there’s an increased recognition that Norway is having a challenge.”
GAS:
Tankers line up off Qatar to satisfy buyers’ hunger for LNG
Bloomberg, September 14, 2021
More than a dozen liquefied natural gas tankers are waiting their turn to fill up at Qatar’s port of Ras Laffan in a clear sign of how tight the global gas market has become.
South Korean and Pakistani buyers are among those seeking to maximize shipments under long-term supply contracts with the Middle Eastern emirate, one of the world’s biggest natural gas exporters, according to traders with knowledge of the matter. The cargoes are linked to oil prices and cost about half of the current rate in spot gas markets, where a global supply crunch has seen prices rise to seasonal highs.
Qatar Petroleum, which markets the nation’s fuel, and Qatargas, which operates the facilities, didn’t immediately respond to a request for comment.
Utilities and city gas suppliers around the world are vying to lock in a finite amount of natural gas before the winter, when demand for the fuel peaks in the Northern Hemisphere. Qatar is seeking to sign more contracts to underpin a massive expansion and has been more willing than its rivals to adjust contracted volumes, whether up as currently or down as during the peak of demand destruction because of the coronavirus epidemic.
Over a dozen ballast liquefied natural gas carriers are offshore Qatar’s coast, while another five are currently loading, according to ship-tracking data compiled by Bloomberg. Seasonally low output has also resulted in the lines, BloombergNEF analysts said last month.
MINING:
Germany: Coal tops wind as primary electricity source
DW.Com, September 14, 2021
Despite efforts to boost renewable energy sources, coal unseated wind power as the biggest energy contributor to the German network in the first six months of 2021, according to official statistics released on Monday.
The data comes as Germany looks to speed up its exit from coal-powered plants after years of mounting pressure from climate experts and activists over the country’s dependence on coal and its detrimental impact in fueling the climate crisis.
But the latest figures also reveal the challenges that lie ahead with the country’s energy shift.
What did the data show?
Data published by the Federal Statistics Office (Destatis) found that the production of electricity from “conventional” energy sources rose by 20.9% this year, compared to the first half of 2020.
In total, conventional energy sources — including coal, natural gas, and nuclear energy — comprised 56% of the total electricity fed into Germany’s grid in the first half of 2021.
Coal was the leader out of the conventional energy sources, comprising over 27% of Germany’s electricity.
Wind power’s contribution to the electric grid, on the other hand, dropped significantly compared to the previous year — from 29% to 22%.
Wind had been the top producer of electricity but has now logged its lowest figures since 2018.
Why did renewable energy dip?
Renewable energies in total dropped during the first half of this year — going from the top producers of electricity to comprising 44%.
But what led to wind power’s sudden fall? Statistics officials said the weather was partly to blame.
A lack of wind from January to March this year sharply reduced the amount of electricity produced by Germany’s wind turbines. In contrast, stormy weather in the first quarters of 2019 and 2020 sharply boosted the electricity produced.
Germany is seeking to have wind, solar, biogas, and other renewable energy sources play a bigger role, as the country looks to completely phase out nuclear power by 2022 and coal-fired power plants by 2038.
POLITICS :
Alaska special session nears end with unresolved debates
Becky Bohrer, Associated Press, September 14, 2021
A bill that would set a dividend for Alaska residents this year sat another day in a Senate committee on Monday, while a bill intended to help with medical facility staffing concerns amid a COVID-19 surge appeared dead in the House as lawmakers neared the end of their third special session.
The Senate Finance Committee has yet to advance a version of the dividend bill passed by the House on Aug. 31. The special session is set to expire Tuesday.
A hearing on the bill was set for Tuesday morning, following days in which the bill had been scheduled for hearing but not taken up.
“We’re trying to get an agreement. The deadline’s midnight Tuesday night,” said Sen. Bert Stedman, a committee co-chair.
If the version that passes the Senate differs from what passed the House, the House will be asked if it agrees with the changes. Disagreements between the chambers often lead to conference committees, which can take time to set up and time for members to try to come to terms.
The House version called for a roughly $1,100 dividend, which House Speaker Louise Stutes has said was “the most the state can afford to pay until Alaska’s structural budget deficit is resolved.”
Senate Minority Leader Tom Begich, an Anchorage Democrat, said he would work in the session’s final hours to encourage colleagues to support the House version, which he said was the “only sure guarantee of a dividend this year. … And people need a dividend.”
Lawmakers in recent years have sought to limit annual withdrawals from earnings of the state’s oil-wealth fund for dividends and government costs, though they can breach the cap if they choose to do so. Members of the bipartisan coalition that Stutes leads have been resistant to exceeding that limit without an agreement on a long-range fiscal plan.
Other lawmakers said the state can afford a larger dividend and that residents could use the help. Gov. Mike Dunleavy has advocated for a check of around $2,350.
This year’s draw from earnings has already gone into the state general fund, the director of the Legislative Finance Division has said.
House majority lawmakers and Dunleavy’s office have different views on whether some of the funds targeted for use for the dividend in the House bill are available without a three-quarter vote.
Begich said he has to leave by 3 p.m. Tuesday for family obligations and hoped the issue in the Senate could be addressed by then.
Meanwhile, the House majority said it will not bring back for debate a bill introduced by Dunleavy that was intended to help address staffing concerns at medical facilities.
The Alaska State Hospital and Nursing Home Association in a statement said recent legislative debates on the bill led to “a host of misinformation, distraction and efforts to undermine sound science and mitigation efforts that individual Alaskans can take to persevere through the pandemic.”
The group’s president and CEO, Jared Kosin, said the group made known that “we’re not interested in going any further” with the bill. He cited concerns with “anti-vaccine” proposals in the Senate and an amendment that passed the House Sunday that said emergency medical service providers were to allow a patient to have a support person with them during treatment.
The House amendment, largely supported by minority Republicans, also drew support from three majority coalition members. Some supporters saw the provision as compassionate.
But Kosin said it “feels like politicians are trying to dictate what a safe environment looks like inside a hospital when doing amendments like this.”
The Senate version included a provision that would allow someone to object to a COVID-19 vaccine “based on religious, medical, or other grounds.” Another provision said businesses or state agencies could not require individuals to be vaccinated against COVID-19 for individuals to access areas or services that are open to the public. Those provisions were removed by a House committee.
Rep. Ben Carpenter, a Nikiski Republican, said Alaskans are concerned about immunization rights. He and other minority Republicans disagreed with the decision to pull the bill from debate, saying a fuller discussion on vaccine and other health care-related issues is warranted.
CLIMATE CHANGE :
From the Washington Examiner, Daily on Energy:
ENVIRONMENTALISTS CRITICIZE DEMOCRATS FOR KEEPING OIL INDUSTRY TAX BREAKS: As the House Ways and Means Committee this morning marks up Democrats’ green energy tax plan, environmentalists are blasting tax breaks for the oil and gas industry that are preserved as part of the package.
House Democrats’ proposal “neglects crucial provisions” to end oil and gas subsidies in the domestic tax code,” said Collin Rees, U.S. Campaigns Manager at Oil Change International.
Democrats’ draft, which could be amended, doesn’t address a Biden request to eliminate oil and gas companies’ ability to expense so-called “intangible drilling costs,” such as labor costs and developing a well site.
It also spares a percentage depletion deduction that allows producers to recoup costs based on how depleted the resource is at a particular drilling site, which is predominantly used by small, independent producers and royalty owners.
Environmental activists are turning their attention to the Senate, where a tax plan advanced by Democrats on the Finance Committee earlier this year targets many of the same favorable provisions for oil and gas companies that Biden has asked Congress to eliminate.
The Ways and Means Committee’s sweeping clean energy tax package features a host of green tax credits worth a combined $235 billion over 10 years, including extending wind and solar incentives through 2033, as well as boosts for carbon capture, direct air capture, existing nuclear plants, transmission, energy storage, and more.