I hope you are enjoying the heart of the August break. Just a short note to alert you to a few items of interest. With all the politics, I’m already growing tired, so we’ll leave that alone.
The annual SEJ conference is right around the corner in Sacramento, September 21-24. As usual, we will have our regular reception on Thursday night but You should start preparing now as it will be a great event. Here is the link to the conference.
Finally, you might have missed this over recess, but Robin Bravender wrote an embarrassingly nice profile my work and our team here at Bracewell. While many of you have probably seen it, I wanted to forward it.
Congress returns September 7th for a few weeks before ending for elections, but I’m around this week/next so let’s connect while we have some free time. You know it is getting crazy for the rest of the fall!!
Finally, I am now on Instagram (fvmaisano) as well as Facebook and Twitter, so I’ve changed my Twitter handle to make it consistent (@fvmaisano). If you’re on these social media platforms, I would encourage you to follow me and PRG (@PolicyRez) because we put a lot of cool stuff on all of these platforms so we can keep you informed.
Ryan Energy Staffer to Head Government Affairs for Sempra Energy – Former senior energy and environment counsel for House Speaker Paul Ryan, Maryam Sabbaghian Brown, has been named Sempra Energy’s new vice president of Federal Government Affairs, based in Washington, D.C. Brown has experience as both a senior energy policy advisor in the U.S. Congress and in management within the energy industry, serving Ryan since 2012. In her new role, Brown will oversee representation of the Sempra family of companies with the executive and legislative branches of the U.S. government, as well as with federal agencies. Reporting to Brown will be Bill Lansinger, director of FERC Relations, and Allison Hull, director of Federal Government Affairs, both based in Sempra Energy’s Washington, D.C., office. Brown succeeds Scott Crider, who, last month, joined SDG&E as its vice president of Customer Services after four years as Sempra Energy’s vice president of Federal Government Affairs.
SMU Paper Shows Small Retailers Hit Hard by RINs Debate – A new paper from Southern Methodist University’s (SMU) Maguire Energy Institute says the structure of EPA’s much-criticized renewable fuels standard (RFS) program has created an unfair playing field that allows big gasoline retailers to reap huge profits that don’t promote increased biofuel use but rather are used to box out small fuel retailers who have historically formed the backbone of the consumer fuel market. According to the study, the unintended consequences of EPA’s choice to place the RFS point of obligation on refiners rather than at the fuel terminal rack are undermining the key purpose of the program: to get more biofuels to market.
Who is Benefiting From RINs – “Large retailers aren’t obligated parties so they have no incentive to increase the blending infrastructure for renewable fuels and promote higher blends,” study author Bernard “Bud” Weinstein wrote in the report, commissioned by a newly-formed coalition of small fuel retailers. “If the RFS obligation were placed at the blending point, and large retailers became obligated parties, these retailers would be more likely to promote the goals of the RFS and increase their marketing and distribution of higher renewable fuel blends.”
Small Retailers Hurt Most – The Small Retailers Coalition, who commissioned the report, was formed to combat the threat of the current RFS structure to the market. Already, it has urged EPA to move the so-called point of obligation to the “rack,” terminals that hold bulk fuels before they move to retail outlets. The current set-up needlessly tilts the playing field towards large retailers by giving large retailers the ability to use windfall profits from RIN sales, profits that small retailers can’t obtain, to discount their gasoline prices. “This study underscores that moving the obligation would reflect the needs of all market participants,” former Natl Assn of Convenience Stores (NACS) President Bill Douglass said. “There are thousands of smaller retailers feeling the adverse impact of the large retailers advantaged by RIN revenue that will share their observation on this market failure. The end result is that small independent retailers will be driven from the market.”
Chamber Energy Institute Highlights Impacts on Banning Energy Production on Federal Lands, Waters – The first report in the Energy Institute’s Energy Accountability Series finds that proposals from Hillary Clinton and other politicians to ban oil, gas, and coal production on federal lands and waters would cost America hundreds of thousands of jobs and billions in revenue. The Series takes a substantive look at what would happen if energy proposals from candidates and interest groups were actually adopted. Over the past year, a growing number of politicians and interest groups—and the Democratic Party itself—have called for an end to oil, natural gas and coal extraction from federal lands and offshore waters. That concept is the basis of the “Keep it in the Ground Act,” a House bill with over 20 cosponsors. If these policies were to be enacted, the Energy Institute’s new report found that it will cost the U.S. $11.3 billion in annual royalties lost, 380,000 jobs, and $70 billion in annual GDP. 25% of America’s oil, natural gas and coal production would be halted.
“American voters deserve to understand the real-world impacts of the proposals that candidates and their allies make,” said Karen Harbert, president and CEO of the U.S. Chamber’s Institute for 21st Century Energy. “In an effort to appeal to the ‘keep it in the ground’ movement, a number of prominent politicians have proposed ending energy production on federal lands, onshore and off. Their proposals will have a direct, harmful effect on the American economy, and in particular decimate several states that rely heavily on revenues from federal land production. Given the implications, these policy proposals should not be taken lightly.”
Who Would Be Most Impacted – Certain states and regions would be disproportionately affected by a cessation on federal-lands energy development. The report provides specific analysis for several of these states. For instance, Wyoming would lose $900 million in annual royalty collections—which represents 20 percent of the state’s annual expenditures. New Mexico could lose $500 million—8 percent of the state’s total General Fund Revenues. Colorado would see the loss of 50,000 jobs, while the Gulf States (Texas, Louisiana, Mississippi and Alabama) would see 110,000 fewer jobs.
“Since 2010, the share of energy production on federal lands has dipped because of increasing regulatory hurdles from the Obama administration,” said Harbert. “Nevertheless, production on federal lands and waters still accounts for a quarter of all oil, natural gas, and coal produced. If that were to end, it would hit Western and Gulf Coast states particularly hard, and could result in production moving overseas, which would harm our national security and impact prices.”
Report Scenarios: Lost Economic Output, Impacts – The Energy Institute’s report provides two scenarios. The first examines the economic output that would be lost or placed at risk if energy development was immediately stopped on all federal acreage. The second scenario analyzes the cumulative impacts of immediately ceasing new leasing while leaving existing leases in place. While the above-mentioned figures apply to scenario 1, scenario 2 also has major impacts, with $6 billion in lost revenues over the next 15 years, and nearly 270,000 impacted jobs. The report utilizes publically available data on jobs, royalties, and production levels and the IMPLAN macro-economic model. A Technical Appendix to the report explains the methodology and sources of data.