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Daily on Energy: White House commits to carbon capture in climate agenda

Josh Siegel Abby Smith July 01, 12:27 PM July 01, 12:41 PM

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STRONG SUPPORT FOR CARBON CAPTURE: The White House is reiterating its support for carbon capture, removal, and storage as a key part of its climate agenda and committing to accelerate its deployment, countering the views of some environmental activists who have urged the Biden administration to exclude the technology.

In a report yesterday, the White House Council on Environmental Quality says the United States “will likely have to capture, transport, and permanently sequester significant quantities of carbon dioxide” in order to meet President Joe Biden’s aggressive emissions goals. The report also underscores that promoting carbon capture development in the U.S. could help drive technology costs down worldwide.

The report, which was required by Congress in a bipartisan measure passed as part of the 2020 year-end spending bill, focuses on whether and how to speed permitting of carbon capture projects and CO2 pipelines. It also touts actions Biden has proposed in his infrastructure plan to boost tax incentives for carbon capture and fund additional pilot projects.

In fact, the carbon capture support proposed by Biden and echoed by legislation in Congress could deliver a 13-fold scale up of the U.S. capacity to capture and store carbon, according to Lee Beck, international director of carbon capture at the Clean Air Task Force.

“Still, incentives alone are not enough for successful and responsible technological deployment, which also requires standards that provide regulatory certainty and safeguard public health and the environment,” the CEQ report reads.

The report won’t put tensions to bed: Certain left-wing environmental groups, as well as the White House’s own environmental justice advisers, have criticized any reliance on carbon capture to curb emissions. In a draft report in May, an independent council of environmental justice advisers to the White House listed carbon capture and storage as a technology that “will not benefit a community,” indicating they don’t believe such projects would alleviate the pollution burden on minority and low-income people.

The Biden administration could face a tough task convincing these opponents of the climate benefits of carbon capture. Nonetheless, the CEQ report does allude to these concerns, stressing the importance of securing buy-in from the places where carbon capture projects would be deployed.

“Responsible CCUS projects should address cumulative pollution and should incorporate environmental justice and equity considerations,” the CEQ wrote.

Some carbon capture advocates, too, say it is incumbent upon the technology’s supporters to broaden their political arguments beyond simply emissions math and economic benefits.

“We have to broaden this lens, w particular focus on elevating community groups and environmental justice voices to ensure CCUS only happens in places where communities truly want them to happen, in a way that delivers benefits to those communities equitably,” said Noah Deich, president of Carbon180, in a tweet thread on the report.

Welcome to Daily on Energy, written by Washington Examiner Energy and Environment Writers Josh Siegel (@SiegelScribe) and Abby Smith (@AbbySmithDC). Email jsiegel@washingtonexaminer.com or asmith@washingtonexaminer.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.

MAKING SENSE OF EXXON’S MESS: There is a lot to unpack from the video of an ExxonMobil lobbyist divulging to an undercover environmental activist that the oil and gas giant funded “shadow groups” to undermine climate policies, even as the company has transformed its public stance on global warming.

But let’s focus on two of the biggest take-aways to us.

First, the senior lobbyist, Keith McCoy, revealed the identities of 11 senators “crucial” to Exxon’s lobbying on Capitol Hill, including a host of Democrats who probably won’t appreciate being named. It could make life harder for centrist Democrats who are known for convening business leaders, including the oil industry, in hopes of advancing bipartisan clean energy and climate legislation.

Among the senators listed as allies, McCoy calls Joe Manchin the “kingmaker” on energy issues because of his status as a Democrat representing West Virginia. Other lobbying targets of Exxon include centrist Democrats Sens. Kyrsten Sinema of Arizona and Jon Tester of Montana. McCoy also singles out Sen. Chris Coons, a Delaware Democrat, as an important contact because of his close relationship with Biden.

“This certainly complicates the politics of this issue for consensus-building members who understand that the best climate solution and only durable solution is bipartisan legislation that can garner support from a diversity of stakeholders including environmental groups and oil and gas companies,” former GOP Rep. Carlos Curbelo of Florida, who introduced a carbon tax bill in 2018, told Josh.

Exxon CEO Darren Woods issued a statement yesterday afternoon condemning the lobbyist’s comments and apologizing for them, specifically those “regarding interactions with elected officials.”

Curbelo said Woods’ cleanup attempt was “smart and necessary,” but he urged the Exxon chief to meet with Senate allies and “clearly state what policies Exxon is advocating for and why, and what resources are behind advocating for those policies.”

The carbon tax question: Exxon is one of many large oil and gas companies and their lobby groups that have endorsed the concept of a carbon tax as preferable to mandates and regulations.

But Exxon’s lobbyist McCoy suggests in the video that the company is only publicly supporting a carbon tax to appear to be environmentally friendly with little consequence because it sees the policy as politically impossible to pass.

Woods stressed Exxon’s “firm commitment” to supporting carbon pricing. Allied groups advocating for a carbon tax are defending Exxon, saying it is sincere.

Greg Bertelsen, CEO of the Climate Leadership Council, noted that Exxon was the first oil company to endorse its carbon tax and dividend proposal in 2017. The following year, Exxon committed to providing $1 million over two years to the Council to help promote the plan.

Oil and gas lobby American Petroleum Institute, which counts Exxon as a member and endorsed a carbon tax this year, says it has held 160 meetings on Capitol Hill regarding carbon pricing.

Curbelo, meanwhile, told Josh that McCoy was an Exxon lobbyist assigned to him when he was in Congress. He said McCoy and other Exxon officials offered “encouraging words” about his carbon tax bill, which would have spent the revenue on infrastructure investments.

“All of our interactions were positive,” Curbelo said. “It was surprising to me to watch those clips because I have been told the opposite. This is a serious crisis for Exxon given all the investments the company has made in this space the last few years.”

HOUSE DEMOCRATS KICK OFF INFRASTRUCTURE BATTLE BY PASSING BILL: The House voted 221-201 this morning to pass a $715 billion transportation and water infrastructure measure that Democrats plan to use to negotiate a larger deal with the Senate and the Biden administration, the Washington Examiner’s Susan Ferrechio reports.

The measure passed mostly along party lines (only two Republicans voted for it) and centered on mitigating climate change by reducing fossil fuels and directing more people to mass transit, electric cars, and other modes of transportation.

“The largest single source of fossil pollution is transportation in this country,” said House Transportation and Infrastructure Committee Chairman Peter DeFazio, an Oregon Democrat. “But where the world is moving to electric, like the corporations in America are moving to electric, but we’re stuck in the past.”

What’s in the bill: While it dedicates $343 billion to upgrading the nation’s crumbling roads and bridges, it provides $109 billion for transit, and $95 billion to passenger and freight rail. The measure would spend nearly $170 billion on water infrastructure projects.

The measure includes new policy directives aimed at reducing fossil fuel use. One provision would require municipalities to first repair existing roads and bridges that need work before dedicating funding to building new ones. It also provides $4 billion for electric vehicle charging infrastructure

The bill sets surface transportation spending levels for the next five years after a current authorization expires on Sept. 30.

The real purpose: But the bill will play a much larger role, Democratic leaders said, by serving as a starting point in the negotiations with the Senate and White House on a much larger infrastructure and social program spending package they hope to pass in the coming months.

MEANWHILE, HOUSE DEMOCRATS PROD BIDEN FOR MORE: Over 130 House Democrats wrote a letter to Biden today urging him to ensure an infrastructure package (presumably through reconciliation) includes a clean electricity standard requiring 100% carbon-free power by 2035, among other “robust” climate policies.

The 133 Democrats, led by Rep. Mike Levin of California and representing more than 60% of the caucus, also call for inclusion of 10-year clean energy tax credits, “major electric vehicle purchasing,” and manufacturing incentives.

There is broad representation among Democrats on the letter, including Progressive Caucus Chair Rep. Pramila Jayapal of Washington and centrist Problem Solvers Caucus co-chair Josh Gottheimer of New Jersey. Chairs of key committees also signed on, among them, Budget Chair John Yarmuth of Kentucky, and Natural Resources Chair Raúl Grijalva of Arizona, and DeFazio of the Transportation Committee.

On the same page: Their push comes a day after White House national climate adviser Gina McCarthy listed renewable energy tax credits and a clean electricity standard when asked what her “non-negotiables” are for a Democrats-only reconciliation bill.

BIDEN SIGNS METHANE CRA: Biden signed a Congressional Review Act resolution yesterday reinstating requirements for oil and gas operators to identify and fix leaks of the potent greenhouse gas methane, canceling a Trump administration action that would have kept the EPA from directly regulating methane emissions.

The Senate approved the resolution in April, and the House approved it last week, both in largely partisan votes with only a handful of Republicans supporting it. Two House Republicans, Reps. Fred Upton and Peter Meijer, joined Biden on stage as he signed the resolution, along with more than dozen Democrats, including House Speaker Nancy Pelosi and House Energy and Commerce Chairman Frank Pallone.

“We’ve learned that methane is even more dangerous to the climate than we knew back then in 2016,” Biden said in remarks before the signing, referring to the Obama administration’s oil and gas methane standards.

“This is an important first step in cutting methane pollution,” Biden added. He touted funding in the bipartisan infrastructure deal that would help cap “millions of abandoned leaking oil and gas wells.” Biden has also tasked the EPA with proposing stricter methane regulations by September.

INTERIOR TO ADVANCE VIRGINIA OFFSHORE WIND PROJECT: The Bureau of Ocean Energy Management announced this morning it would issue a notice of intent for the largest proposed commercial offshore wind project in the U.S. to date, Dominion Energy’s project off the shores of Virginia Beach.

The notice kicks off a 30-day public comment period on Dominion’s plans and signals BOEM’s intent to begin an environmental review of the project. Dominion officials have said they hope to obtain a completed environmental review in 2023 so they can begin construction in 2024 and bring the project into service in 2026.

“Building a domestic offshore wind supply chain is a key step needed to meet this administration’s goal of 30 [gigawatts] by 2030,” said BOEM director Amanda Lefton.

For more on Dominion’s project, see Abby’s recent story following a trip out to tour the company’s two pilot turbines last month.

GOP SENATORS RAISE ALARM OVER ASSET MANAGERS AND CLIMATE: Sens. Pat Toomey and Ron Johnson are raising concerns that major asset managers BlackRock and State Street Global Advisors, which manage federal employees’ retirement investments, are prioritizing issues such as climate change over fiduciary responsibility.

The senators pointed to recent comments from the CEOs of BlackRock and State Street that they would focus on climate change risks and the transition to a low-carbon economy, as well as diversity issues, as part of their proxy voting agendas.

“Specifically, recent statements by the CEOs of BlackRock and State Street Global Advisors (SSGA) indicate they are using their control of proxy votes for federal employees’ Thrift Savings Plan investments to pressure other companies to adhere to their own environmental and social policy views,” the senators wrote in a letter yesterday to David Jones, acting chairman of the Federal Retirement Thrift Investment Board.

The senators are asking Jones for a briefing on the issue, including what oversight the Board has of proxy voting use by the plan’s investment managers, by July 26.

The Rundown

Bloomberg Saudis, Russia in tentative deal for gradual oil-output hike

New York Times Are ‘heat pumps’ the answer to heat waves? Some cities think so.

Washington Post Federal program debuts climate change, racial justice criteria as part of infrastructure grants

Axios Wall Street vet leaving Kerry’s climate team

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