Today’s Key Takeaways: Will SCOTUS restrict federal agency powers? Alaska escalates ANWR fight. FERC fights back. Alaska Miners highlight 2024 state issues of concern. Alaska legislators get a big pay raise.
NEWS OF THE DAY:
The Case for the Supreme Court to Overturn Chevron Deference
The Editorial Board, The Wall Street Journal, January 15, 2024
The Supreme Court has been trying to restore the proper constitutional balance of power, and its next opportunity comes Wednesday when it hears two cases challenging its own landmark
In 1984 in Chevron v. NRDC, the Justices ruled that courts should defer to administrative agencies’ interpretation of laws when the statutory text is silent or ambiguous. In practice this has become a license for Congress to write vague laws that delegate legislative power to administrative agencies. Over the last 40 years the federal register of regulations has grown by tens of thousands of pages.
Wednesday’s cases are textbook examples of how regulators invoke Chevron to expand their power and impose enormous burdens on Americans. Family-owned herring fisheries and vessel operators are challenging an obscure Commerce rule that requires New England fisheries to pay for on-board monitors.
OIL:
Alaska Escalates Arctic Refuge Oil Feud Over ‘Lease’ Definition
Bobby Magill, Bloomberg Law, January 17, 2024
- Alaska accuses Interior of illegally revoking leases
- Agency canceled seven Arctic Refuge oil leases
Alaska is accusing the Interior Department of illegally treating an oil and gas lease like a license in an amended complaint the state filed Tuesday in its challenge to the agency’s cancellation of the state’s Arctic National Wildlife Refuge oil and gas leases.
The Interior Department in 2023 canceled seven oil and gas leases the Alaska Industrial Development and Export Authority purchased during the Trump administration within the refuge. The department said the leases were sold illegally, and it’s urgent to cancel them because of their expected contributions to climate change.
GAS:
A RUBBER STAMP FOR LNG EXPORT PROJECTS? The former head of the Federal Energy Regulatory Commission pushed back on criticisms from Democrats that the Biden administration is “rubber stamping” the approval of new LNG export terminals.
First, the criticism: Sen. Jeff Merkley of Oregon and other liberal Democrats have pressed the administration to reconsider the criteria it uses to approve new LNG export terminals. At least 11 proposed LNG projects have been fully approved by FERC and the Energy Department.
Merkley has accused FERC of “rubber-stamping” every application that has come before it, at the expense of “climate chaos.” And in a letter to the DOE he led in November, more than 60 Democrats faulted DOE for never denying LNG project approval based on climate considerations.
The pushback: Former FERC chairman Neil Chatterjee took umbrage at the criticism, arguing that the approval rate is somewhat misleading. He said that projects must go through a demanding process and that ones that don’t meet the criteria are turned away before an official approval decision is sought.
Before DOE can issue final determinations on LNG projects, FERC is tasked with overseeing all environmental impact assessments and ensuring NEPA compliance.
It’s during the lengthy and expensive safety and environmental certification process overseen by FERC that many would-be projects flame out, Chatterjee told the Washington Examiner in an interview.
The “rubber stamp” criticism “doesn’t account for all of the permit applications that are withdrawn or don’t complete the process, because project sponsors recognize that their applications are not viable” before they even reach DOE, Chatterjee said.
“The FERC process is incredibly rigorous, it’s expensive, it’s time consuming, and it’s thorough,” he added.
Members of FERC—a separate, independent agency with a bipartisan configuration— are also “subject to legal scrutiny of their decisions and sticking to past precedents,” Chatterjee said.
Another key point: It is only after FERC grants the certification to proposed LNG facilities that they are passed on to the Energy Department for final authorization. DOE is required to automatically approve FERC-certified LNG exports to any free trade agreement (FTA) countries, thanks to a requirement Congress included in the Natural Gas Act.
In fact, DOE can only make the “public determination” decisions for non-FTA countries, or if trade to a certain country is expressly prohibited by current law or policy.
(Currently, neither EU countries nor Japan are FTA-designated countries, giving DOE a bit more wiggle room on this.)
We asked the offices of Merkley and other Democrats for any response and will provide an update if one is provided.
Why it matters: The U.S. is in the process of building out more than 70 million tons per year in baseload LNG export capacity, according to a report from the Center for Strategic and International Studies.
The explosion of U.S. exports — especially following Russia’s invasion of Ukraine, which increased EU LNG demand by 60%—led to an escalation in the debate. Industry groups argue LNG exports are fundamental to energy security and Democrats say they put climate and emissions targets at risk.
MINING:
2024 STATE ISSUES OF CONCERN FOR THE ALASKA MINING INDUSTRY
The Alaska Miners Association State Oversight Committee has finalized its 2024 Issues of Concern, a document outlining policies that can grow Alaska’s mining industry and the benefits it provides.
The document is public and is provided to policymakers, AMA members, and the general public.
Key policies covered in this document include promotion and defense of our robust permitting system, reasonable and science-based water policy and regulation, responsible fiscal policy, equitable local taxation, ballot initiative reform, funding disclosure for nonprofit advocacy, management of Alaska’s lands and minerals in accordance with the Alaska Constitution, mining education and training, infrastructure investment, and support of State of Alaska efforts to oppose harmful federal policies that impede investment and ignore the intent of ANILCA, ANCSA, and more.
The annual Issues of Concern document is compiled and approved by AMA’s 50-plus member State Oversight Committee, comprised of AMA members across all types of mining and support sectors.
POLITICS:
What we’re watching this week: production forecasts, revenue forecasts, critical minerals plan and report and conversations about a smaller diameter pipeline.
Alaska Legislature Convenes Session Focused on Education and Energy Issues
Alaska Legislators Start 2024 Session With Pay Raises and a Busy Docket