Friends,

I thought I’d do a quick update for you this week despite this being the holiday week.  While Friday, July 4th is the US independence Day, tomorrow July 1st is also Canada Day. For those of us who spent a large part of our younger days traveling from rink to rink in lots of northern environs, the day mean almost as much, eh!  The occasion marks the joining of the British North American colonies of Nova Scotia, New Brunswick, and the Province of Canada into a federation of four provinces (the Province of Canada being divided into Ontario and Quebec) on July 1, 1867.

While we blow off fireworks, have barbeques and the Stars and Stripes, the Canadians see their birthday a little differently.  In fact, our friends at Molson, with the Stanley Cup having been awarded and hockey on hiatus, are tapping the Molson Canadian traveling beer fridge, tempting Canadians with the promise of free beer only after they unlock it with a few verses of the Canadian national anthem, Oh Canada.  (Here are the lyrics in case you run into the Molson Beer Fridge.)

If you’re still working tomorrow, my Bracewell colleagues Eric Washburn and Lowell Rothschild will be hosting a Bloomberg BNA webinar at 1:00 p.m. focusing on new proposed rules on endangered species and waters. The webinar will address environmental and public policy issues associated with community environmental resources located on private lands, how the rules fit into the broader regulatory policy of the Obama Administration and interact with active NGO agendas and how the rules might impact energy development, agriculture, manufacturing, and electrical generation.  Let me know if you’re interested and we’ll get you the info.

Enjoy the week… Call if you have questions

Frank Maisano
(202) 828-5864
c. (202) 997-5932

IN THE NEWS

Industry Asks for Comment Extension – The utility industry has requested that EPA extend the comment period on the new GHG rule for existing power plants by 60 additional days.  The request comes as industry and other groups detail the complexity of the rule and how it will impact the overall economy.

Segal on Diane Rehm Show – The SCOTUS ruling on the tailoring rule which we discussed last week also launched Scott Segal onto the Diane Rehm Show.  Take a listen to hear Segal add Michael Brune to the list of enviro activists that he give a policy beat down to.  It is entertaining.

Loveland Voters Reject Moratorium –Voters in Loveland, CO rejected a moratorium last week confirming a hypothesis Coloradans for Responsible Energy Development (CRED) has been promoting for over nine months: when individuals have the facts, they support fracking. Citing Loveland as a perfect case study and microcosm of the national debate on fracking, CRED pointed to Loveland’s special election as proving its hypothesis true and applauded voters who had the courage to have an honest, open dialogue about fracking.  As a part of the primary election held on June 24, 2014, residents in Loveland were asked whether or not a two-year moratorium on fracking should be enacted in order to further study the time-tested and well-proven energy production technique of fracking. CRED applauded Loveland voters who saw through the “delay tactics” behind the call for further studies, and encouraged other Colorado communities to follow their lead and learn more about fracking’s 60 year history.  These election results follow an announcement by the U.S. Bureau of Labor Statistics that neighboring Weld County, Colorado – home to 85% of Colorado’s oil production and the heart of responsible energy development – is thriving and had the largest percentage increase in employment in the US in 2013. Duke University separately drew attention to the tax revenue Weld County received from oil and natural gas development, increasing from roughly $50 million per year in the early 2000s to over $200 million in 2012. Statewide, Colorado’s oil and natural gas industry supported more than 110,000 jobs, generated $29.6 billion in economic activity in Colorado and $1.6 billion in tax revenues that go to schools, roads, infrastructure, and other critical services.

New CU Study Highlights Drilling Ban Impacts – A study released by researchers at the Business Research Division of the Leeds School of Business at CU Boulder quantified the ill effects of a potential statewide ban on fracking in Colorado. The study, titled Hydraulic Fracturing Ban: The Economic Impact of a Statewide Fracking Ban in Colorado, showed that a statewide fracking ban would “result in 93,000 fewer jobs, $12 billion in lost gross domestic product (GDP) and an annual reduction of $985 million in tax revenue for local and state governments between 2015 and 2040.” Additionally, the National Association of Royalty Owners (NARO) released a report quantifying the effect of a county-level ban on fracking in nearby Boulder County, concluding that such a ban would cost the county over $1 billion in compensation to mineral owners and those who receive royalties from energy development on their property.

Utility Scale Solar Growth Makes CA ISO Records – On June 1, 2014, the California Independent System Operator (CAISO) recorded a record midday hourly peak of 4,767 MWAC of utility generated solar electricity delivered into the California grid. With rapidly growing utility-scale solar capacity, CAISO has regularly recorded new hourly output records going back to 2010 when it first began publishing the daily data.  EIA has a great chart on the subject which includes a lot of power from Ivanpah, which was brought on line in January of this year.

EIA Reports Document Increases in Renewables, Fossil Fuels –Speaking of EIA, two new back-to-back reports provide a snapshot of U.S. energy trends for the first months of 2014.  EIA’s “Electric Power Monthly” (released on June 23rd) provides data for the nation’s electrical sector through April 30th.  EIA’s “Monthly Energy Review” (released June 25th) provides 1Q data for all energy sectors.  From EIA’s “Electric Power Monthly” report, developments of particular note include 1) Renewable energy sources provided over 14% of the nation’s electricity – a level that the EIA has been saying might not be reached until 2040. 2) Wind has now passed the 5% percent (5.15) threshold. 3) Electrical generation from solar for the first four months of 2014 is more than double that for the same period in 2013 (increasingly 108.9%).  4) electrical generation from nuclear power rose 0.7% in the first four months of 2014 compared to the first third of 2013; however, as a share of total U.S. electrical generation, nuclear declined from 19.71% in the first third of 2013 to 19.15% in first third of 2014.  From EIA’s “Monthly Energy Review,” key findings include 1) domestic energy production from renewable sources grew by 4.36% during the first quarter of 2014 compared to the same period in 2013, accounting for 11.41% of total U.S. energy production. 2) Compared to 2013 1Q activity, production of fuel ethanol  – used primarily in the transportation sector – grew by 11.74% and biodiesel by 10.85%.  3) As well, consumption of fossil fuels increased by 5.17% in 1Q 2014 with coal by 8.91%, natural gas by 7.43%, and petroleum by 1.07%.  4) Finally, carbon dioxide (CO2) emissions from the consumption of fossil fuels rose by 5.48% during 1Q 2014 compared to the same period in 2013 and by 10.52% when compared to the first quarter of 2012.

IER Report Outlines GHG Rule Impacts – The Institute for Energy Research released a report last week assessing the implications of the federal government’s anti-coal policies. The report, “Protect the American People: Moratorium on Coal Plant Closures Essential,” was co-authored by Dr. Roger Bezdek and Dr. Frank Clemente and comes in the wake of the EPA’s newly proposed greenhouse gas regulations, which will force electricity providers to reduce their emissions of carbon dioxide.  The report calls for an immediate moratorium on closure of coal plants to protect reliability, maintain affordability and security of our energy system for families and businesses. Key findings include 1) Policies that hurt the U.S. coal fleet will significantly increase wholesale electric rates – and could increase them by as much as 80%, 2) Anti-coal policies harm those who can least afford it – low income families, minorities, children and the elderly, 3) By taking coal out of our energy mix, huge price increases for other electricity sources will be necessary to make sure the lights stay on, 4) Coal met 92% of the year-over-year incremental electricity demand during the first two months of 2014, 5) In early 2014, without coal plants, parts of New England, the Midwest and other regions would have experienced brownouts and blackouts that would have been economically disastrous and threatened human health and safety, and next winter many of those plants will not operate due to government policies, 6) U.S. coal used for electricity generation has increased 170% since 1970 as key emission rates have been reduced by 90% and 7) Regional impacts in key states will be significant, including Indiana, Iowa, Michigan, Missouri, Ohio, West Virginia and Wyoming.

Steyer Report Angles at Business – Former Treasury Secretary Hank Paulson, billionaire Tom Steyer and former New York Mayor Michael Bloomberg warned in a new report last week that rising sea levels, increasing storm surges and warmer temperatures will cost the U.S. billions if little action is taken to mitigate climate change. The report concludes that, in the next 15 years, higher sea levels and storm surges will increase the cost of damages along the Eastern Seaboard and the Gulf of Mexico by $2 billion to $3.5 billion a year.

Extenders Coalitions Rolls Out Letter Calling for Action – A new coalition of companies, organizations and associations, released a letter late last week calling on Congress to act immediately on the EXPIRE Act (tax extenders) to ensure the continued growth of the renewable energy, energy efficiency, and advanced biofuels industries.  Major portions of the economy are represented including commercial energy efficiency, biggest biofuels maker, wind turbine makers (on the call) and letter-signers like the American Farm Bureau, the biggest steelmaker in America, and Sherwin Williams among many others.  I have a copy of the letter but it is also online here.

ON THE SCHEDULE THIS WEEK

Forum to Discuss Russia, Ukraine, Energy – The Woodrow Wilson Center will hold a forum tomorrow at 10:30 a.m. looking at energy and its potential impact on future solutions to the Ukraine crisis, as well as overall relations among Russia, other Eurasian states, the European Union, and the United States.  Editors of the second edition of Energy and Security (now in its second printing by the Wilson Center Press and Johns Hopkins University Press) Jan Kalicki and David Goldwyn have served in leading energy and foreign policy roles in five U.S. administrations, Democratic and Republican.

Bracewell Experts to Address ESA at BNA Webinar – My Bracewell colleagues Eric Washburn and Lowell Rothschild will be hosting a Bloomberg BNA webinar tomorrow  at 1:00 p.m. focusing on new proposed rules on endangered species & waters. Recent regulatory changes proposed by the EPA, FWS and the Corps would expand the scope of Endangered Species Critical Habitat Designations, limit the ability of federal agencies to approve actions adversely affecting critical habitat, and expand the jurisdiction of EPA and the Corps over wetlands and other waters.  The webinar will address environmental and public policy issues associated with community environmental resources located on private lands, how the rules fit into the broader regulatory policy of the Obama Administration and interact with active NGO agendas and how the rules might impact energy development, agriculture, manufacturing, and electrical generation.  Let me know if you’re interested and we’ll get you the info.

Forum to Look at Energy Efficiency Financing – The Alliance to Save Energy for the first in a series of Energy 2030 Congressional briefings on Tuesday, July 1st at 12:00 p.m. in 2456 Rayburn looking at perspectives on energy efficiency financing.  Speakers will include EDF’s Elgie Holstein and several others.

Forum to Feature European Energy Official – The CSIS Energy and National Security and Europe Programs will host a forum tomorrow at 1:00 p.m. featuring Dominique Ristori, Director General for Energy for the European Commission, to discuss the strategic importance of transatlantic cooperation for key energy priorities. With a rapidly evolving energy landscape featuring novel sources of supply alongside supply disruptions, the need for cooperation has become increasingly salient. Ristori will discuss the common objectives of the U.S. and the EU, including competitiveness, security of supply, and decarbonization, and the importance of cooperation on those objectives. Sarah Ladislaw, Director and Senior Fellow in the CSIS Energy and National Security Program, will moderate.  Ristori has worked in the European Commission since 1978 and has held several senior positions.

July 4th Holiday

FUTURE EVENTS

Forum Focused on Mexican Energy Issues – The CSIS Energy and National Security and Americas Programs will host a forum on Monday July 7th at 1:30 p.m. featuring Jesus Reyes Heroles, Former General Director of Petroleos Mexicanos (PEMEX) and Executive President of Grupo de Economistas y Asociados,  Pedro Haas, Senior Adviser at McKinsey & Co and Ed Morse, Head of Commodities Research at Citigroup, to discuss the recently introduced reforms to the Mexican Oil and Gas sector, the likely path forward, the implications for PEMEX and the resultant impacts on world oil markets. Ambassador Medina Mora, Mexican Ambassador to the United States, will provide introductory remarks. Guy Caruso, Senior Adviser at CSIS, will moderate. Despite its position as the world’s 9th largest producer of oil and the third-largest in the Western Hemisphere, Mexico has been plagued by consistent declines in production. At the end of 2013, Mexico approved historic legislation that would end the ban on private sector participation in the Mexican energy sector. These reforms promise to address many of the obstacles that have led to the country’s declining oil production. Before the reforms can take effect, however, the Mexican Legislature must pass secondary laws that focus on the fiscal regime, especially important will be the exploration and production contracts.

IEA Chief to Discuss Gas Market Report – The CSIS Energy and National Security Program will host a forum on Tuesday, July 8th at 10:00 a.m. featuring Anne-Sophie Corbeau, who will present the IEA’s Medium-Term Gas Market Report. The annual report, which gives a detailed analysis and five-year projections of natural gas demand, supply and trade developments, sees global demand rising by 2.2% per year by the end of the forecast period, compared with the 2.4% rate projected in last year’s outlook. Liquefied natural gas (LNG) will meet much of this demand, with new pipelines also playing a role. The Medium-Term Gas Market Report is part of a series of annual reports the IEA devotes to each of the main primary energy sources: oil, gas, coal, renewable energy and – as of last year – energy efficiency.

Enviro Groups to Host Anti-NatGas Rally – The Chesapeake Climate Action Network is hosting a national rally to stop natural gas exports at Cove Point on Sunday, July 13th on the National Mall.

NARUC Summer Meetings Set – The National Association of Regulatory Utility Commissioners’ Summer Committee Meetings, one of three conferences NARUC holds each year, will take place at the Omni Dallas Hotel in Dallas, Texas, from July 13-16. The meeting will feature discussions on the top regulatory challenges across all utility sectors—water, electricity, natural gas, and telecommunications. Panels will tackle the latest developments on the Environmental Protection Agency’s landmark greenhouse gas-emissions proposals, Liquefied Natural Gas exports, Internet neutrality and the transition from traditional telephone service to IP-based networks.  Featured speakers include Federal Energy Regulatory Commission Acting Chair Cheryl LaFleur, FERC Commissioner Tony Clark, Federal Communications Commission Member Mignon Clyburn, Environmental Protection Agency Acting Assistant Administrator for the Office of Air and Radiation Janet McCabe, Pipeline and Hazardous Materials Safety Administration Administrator Cynthia Quarterman, Duke Energy President, CEO Lynn Good, Luminant CEO Mark McFarland, and many more.

CSIS to Host IEA Mid-Term Gas Report – The CSIS Energy and National Security Program will host Anne-Sophie Corbeau to present the IEA’s Medium-Term Gas Market Report on Tuesday July 8th at 10:00 a.m.. The annual report, which gives a detailed analysis and five-year projections of natural gas demand, supply and trade developments, sees global demand rising by 2.2 percent per year by the end of the forecast period, compared with the 2.4 percent rate projected in last year’s outlook. Liquefied natural gas (LNG) will meet much of this demand, with new pipelines also playing a role. The Medium-Term Gas Market Report is part of a series of annual reports the IEA devotes to each of the main primary energy sources: oil, gas, coal, renewable energy and – as of last year – energy efficiency. Jane  Nakano, Fellow with the CSIS Energy and National Security Program, will moderate.

EIA Energy Conference to Feature Upton – The U.S. Energy Information Administration (EIA) will hold its 2014 EIA Energy Conference on July 14th and 15th.  The EIA Energy Conference has become a premier forum for addressing energy issues in the United States and around the world. This event will bring together thought leaders from industry, government, and academia to discuss current and future challenges facing domestic and international energy markets and policymakers. The conference will feature keynote speakers including House Energy and Commerce Committee Chair Fred Upton, IEA Director Maria van der Hoeven and IHS Vice Chairman Daniel Yergin, among many others.

McCabe to Address ICF Energy Breakfast –ICF hosts its July Energy Breakfast on Thursday July 17th at the National Press Club featuring EPA Air Administrator Janet McCabe.  McCabe will discuss EPA’s newly released Existing Source Performance Standards (ESPS) regulations for power plants.  The discussion will focus on how the regulations affect states, regions, companies and customers as well as are the benefits worth the costs.

Forum to Look at SCOTUS Decisions on Air Rules – The Women’s Council on Energy and the Environment (WCEE) and Air and Waste Management Assn (AWMA) will hold a forum on Thursday, July 17th to look at an industry view of recent Supreme Court Decisions on Air Rules.  The forum will look at the Supreme Court decisions on the Cross State Air Pollution Rule (CSAPR) and the GHG PSD Rule.  CSAPR applies to air emissions from electric generation facilities that EPA determined has impact across state lines; the GHG PSD rule applies to all industry and if upheld, EPA can lower the trigger threshold to cover more facilities. EPA’s exercise of authority for both rules are likely to have broader implications for industry for other air pollution issues.   Roger Martella, former General Counsel of EPA and partner at Sidley Austin LLP, and Linda Kelly, Vice President and General Counsel for the National Association of Manufacturers, will share their views on the Supreme Court decisions and the implications for industry. Clara Maria Poffenberger will serve as moderator.

EPA Public Meetings Set – EPA will Hold public Meetings in Atlanta, Denver, Washington and Pittsburgh.  The Atlanta and Denver meeting will be on July 29th while DC will be July 30 and Pittsburgh on July 31st.

Annual Congressional Renewable Expo Set – The 17th annual Congressional Renewable Energy & Energy Efficiency EXPO + Forum  will be held Thursday – July 31 (9:30 am – 4:30 pm) in the Cannon House Office building in cooperation with the House and Senate Renewable Energy & Energy Efficiency Caucuses.

TX Enviro Superconference Set for Austin – The 26th annual Texas Environmental Superconference will be held on Thursday and Friday on August 7th and 8th at the Four Seasons.  Several Bracewell attorneys will be speaking on panels on the many speakers, including Lowell Rothschild, Rich Alonso and Tim Wilkins.  TCEQ’s Bryan Shaw and EPA’s Ron Curry will also speak.