Preview Newsletter
ACC PM 4/10/2017
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(ACC Mentioned) We Were ‘Forceful’ With Trump, Says Building Trades President
Apr 10, 2017 | People's World
By Mark Gruenberg
“Understanding, appreciating and successfully operating within the political realities as they exist today in the United States is strategically necessary if we are to continue to make gains for our members and our unions,” said North America’s Building Trade Unions (NABTU) President Sean McGarvey. -
FDA Seeks Public Input for Next International Cosmetics Meeting
Apr 10, 2017 | Chemical Watch
The US Food and Drug Administration (FDA) plans to hold a public meeting to gather input for the upcoming International Cooperation of Cosmetics Regulation (ICCR-11). -
10 Things You Should Know About the Clean Power Plan
Apr 7, 2017 | Energy Post (via Real Clear Energy)
By Tomas Carbonell
The Trump Administration has taken action to revoke the Obama Administration’s Clean Power Plan – one of the major ways in which the U.S. government is implementing its pledge under the Paris Climate Agreement. -
Is Peak Oil Demand for Real?
Apr 10, 2017 | Fuel Fix
By James Osborne
Standing at the front of a windowless room in downtown Washington last week, the Swiss energy economist Christoff Frei lectured on how the world’s energy sector is about to undergo an upheaval the likes of which has not been seen in a century. -
Carbon Emissions from Energy Sector Drop
Apr 10, 2017 | The Hill - E2 Wire
By Timothy Cama
Carbon dioxide emissions from the United States’ energy sector fell last year, due mainly to a significant drop in the use of coal. -
Hundreds Comment on Atlantic Coast Pipeline EIS; Forest Service OKs Appalachian Trail Crossing
Apr 10, 2017 | Natural Gas Intelligence
By Charlie Passut
The U.S. Forest Service (USFS) told FERC that a proposal to use horizontal directional drilling (HDD) to construct the Atlantic Coast Pipeline (ACP) -- to avoid impacts to the Appalachian Trail and the Blue Ridge Parkway -- is feasible, and it would not object to concurrent construction through other forest lands before the crossing is completed. -
Renewable Energy Tax Credits Challenge Markets
Apr 10, 2017 | Houston Chronicle
By Chris Tomlinson
In the spring and fall, the wind blows so hard at night that wind turbines supply all of the power that Texas needs in the wee hours of the morning. -
N.D. Loosens Reporting Standards for Oil Spills
Apr 10, 2017 | E&E Energywire
By Mike Lee
North Dakota has rolled back part of its strict reporting requirements for oil spills, just over three years after they were enacted. -
NCDOT Obtains Grant to Reduce Locomotive Emissions
Apr 10, 2017 | Progressive Railroading
The North Carolina Department of Environmental Quality has awarded a $39,000 grant to the N.C. Department of Transportation's (NCDOT) Rail Division to continue work on minimizing air pollution from its locomotive fleet. -
Trump May Change or Scrap Obama Ozone Standard
Apr 10, 2017 | E&E Greenwire
By Amanda Reilly
The Trump administration is considering whether to change the national ozone standard set by the Obama administration in 2015, a court filing reveals. -
Senators to Pruitt: How Will You Cut CO2 Now?
Apr 10, 2017 | E&E Climatewire
By Niina Heikkinen
Leading Democrats in the Senate and state attorney general offices are calling for greater transparency and more documents from U.S. EPA Administrator Scott Pruitt. -
Skeptics Pressure Pruitt to Undermine Climate Science
Apr 10, 2017 | E&E Greenwire
By Hannah Hess
A group of homeowners concerned about how a government-mandated shift toward renewable energy sources might affect their electric bills has petitioned U.S. EPA for reconsideration of the agency's finding that greenhouse gases "endanger" public health and welfare. -
Agency Touts Perry's Carbon-Cutting Cred
Apr 10, 2017 | E&E Climatewire
By Umair Irfan
The Department of Energy is celebrating Secretary Rick Perry's record of reducing greenhouse gases during his term as governor of Texas. -
US Delays G7 Climate Statement
Apr 10, 2017 | The Hill - E2 Wire
By Devin Henry
Nations attending a G7 summit could not release a joint climate statement at the end of a meeting this week because the Trump administration is reviewing its policies. -
Environmentalists Say EPA Lacks Legal Basis to Delay Ozone NAAQS Suit
Apr 10, 2017 | Inside EPA
By Anthony Lacey
Environmentalists are urging a federal appeals court to reject EPA's request to delay April 19 oral argument in litigation over the Obama-era decision to tighten the federal ozone limit, saying the agency's “thin excuse” to postpone argument while it weighs potential reconsideration of the rule falls far short of the legal basis for a delay. -
A Glimpse into the Future of Environmental Policy
Apr 10, 2017 | Forbes
By Simon Flowers
What will the energy world look like in twenty years time and beyond? Advances in technology and environmental policy are among the factors influencing demand growth and shaping what may be a very different energy mix in the future.
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(ACC Mentioned) We Were ‘Forceful’ With Trump, Says Building Trades President
Apr 10, 2017 | People's World
By Mark Gruenberg
“Understanding, appreciating and successfully operating within the political realities as they exist today in the United States is strategically necessary if we are to continue to make gains for our members and our unions,” said North America’s Building Trade Unions (NABTU) President Sean McGarvey.
McGarvey delivered the keynote address at the recent legislative conference of NABTU, a division of the AFL-CIO.
He acknowledged that he has received criticism from other sectors of the labor movement when he and building trade union presidents met with Donald Trump at the White House.
However, McGarvey said, building trades unions must continue to seek common ground on specific issues from politicians on both sides of the aisle.
“We were quite forceful with the president in stating our concerns that infrastructure investments must be coupled with strong community wage and benefit standards afforded under the Davis-Bacon Act,” he said.
The Davis-Bacon Act, passed in 1931, requires construction contractors working on federally funded projects to pay their workers at rates established by the federal government for each area of the country. Many states have also passed laws similar to Davis-Bacon.
McGarvey continued, “It is in the best economic interests of our members and our unions for us to go everywhere and anywhere with business and industry leaders, community leaders and political leaders, and to engage in deliberations, conversations and discussions that have the potential to advance the economic interests of our members and their families.”
He urged the NABTU delegates to support formal labor-management committees with entire industries and individual large corporations. He pointed out that unions had recently established such a committee with the American Chemistry Council and that there are ongoing committees with the oil and natural gas industry, the nuclear industry and the electric utilities industry.
“And it is not by mere coincidence,” he said, “that these same organizations have all expressed public support for the federal Davis-Bacon Act.”
McGarvey also called for increasing partnerships with community groups, pointing out that building trades apprenticeship programs have been a boost for minorities and women. He reported that more than four-fifths of the unions’ most recent graduating classes of apprentices were minorities and that 23 percent were female.
Furthermore, McGarvey said that unions must invest their funds into construction projects that employ union workers. “There is our increasingly aggressive expansion of our Capital Strategies Approach, focused upon marshaling building trades’ pension assets and investments, in order to further our ability to provide financing for commercial, residential and infrastructure investments that rebuild this country and produce job opportunities for our members and future members,” he said.
What’s more, Garvey said, “We intend to transition our ‘Hardhats for America’ effort from 2016 into a formal organization known as Re-Build USA.”
It will work to hold the president, and all elected officials accountable. It will also fight any efforts to undermine pay standards set by existing federal and state laws.
But most important, McGarvey said, Re-Build USA “will design and execute a comprehensive and effective communications campaign designed to reach our members where they live and work” at their job sites, at home and through social media.
This must start now, McGarvey warned.
“There can be no doubt,” he said. “The critical lesson from the 2016 election (when the building trade unions endorsed the Democratic candidate, Hillary Clinton) is that we must collectively do a better job of communicating with our membership.
“We cannot wait until Labor Day of an Election Year to start talking about issues and candidates.”
http://www.peoplesworld.org/article/we-were-forceful-with-trump-says-building-trades-president/
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FDA Seeks Public Input for Next International Cosmetics Meeting
Apr 10, 2017 | Chemical Watch
The US Food and Drug Administration (FDA) plans to hold a public meeting to gather input for the upcoming International Cooperation of Cosmetics Regulation (ICCR-11).
Interested parties may present proposals for future IRCC agenda items, as well as data or information on issues related to the regulation of cosmetics.
ICCR is a voluntary international group of cosmetics regulatory authorities from Brazil, Canada, Japan, the US and the EU. It meets annually to discuss common issues on cosmetics safety, and to determine possible actions where it can promote convergence of regulatory policies and practices.
Topics addressed by the group, since it was established in 2007, include:
product preservation;
alternatives to animal testing;
allergens;
cosmetics safety assessments;
nanotechnology/nanomaterials; and
unwanted trace elements.
The FDA meeting is scheduled for 25 May in College Park, Maryland. Those interested in attending or speaking must register by 11 May.
ICCR-11 will be held in Brasilia, Brazil on 12-14 July.
The FDA held a similar meeting last year in preparation for ICCR-10.
https://chemicalwatch.com/55078/fda-seeks-public-input-for-next-international-cosmetics-meeting
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10 Things You Should Know About the Clean Power Plan
Apr 7, 2017 | Energy Post (via Real Clear Energy)
By Tomas Carbonell
The Trump Administration has taken action to revoke the Obama Administration’s Clean Power Plan – one of the major ways in which the U.S. government is implementing its pledge under the Paris Climate Agreement. According to Tomas Carbonell of the U.S.-based NGO Environmental Defense Fund (EDF), Trump’s action has little public support.
On 28 March, just hours after President Trump signed an executive order to weaken a wide range of America’s important climate and heath protections, the Administration filed a motion to delay the D.C Circuit court’s review of the Clean Power Plan case.
That’s only the first of what we expect will be many attacks on the Clean Power Plan – our only nationwide limit on climate pollution from power plants. However, the Clean Power Plan is popular with Americans across the country, and an extraordinarily broad and diverse group of leaders and experts from across America have announced their support for the Clean Power Plan since the executive order.
You’ll likely be hearing a lot about this story in the near future. While you follow the news, here are 10 things you should know about the Clean Power Plan.The Clean Power Plan is expected to save thousands of lives and protect the health of Americans across the country. According to EPA’s analysis, when fully implemented the Clean Power Plan will:Prevent up to 3,600 premature deaths each yearPrevent up to 1,700 heart attacks each yearPrevent up to 90,000 asthma attacks each yearPrevent up to 300,000 missed work days and school days each yearThe Clean Power Plan’s pollution reduction targets are eminently achievable.
Carbon pollution from the power sector has decreased by more than 20 percent since 2005, meaning that we’re already more than two-thirds of the way toward meeting the Clean Power Plan standards for 2030. In fact, most states that are litigating against the Clean Power Plan are on track to meet these pollution limits. The Clean Power Plan is essential to ensure that this momentum is sustained and that power sector investments in clean energy are deployed in a way that maximizes their pollution reduction benefits.The Clean Power Plan can reduce electricity bills for families.
The Clean Power Plan gives states and power companies tremendous flexibility in deciding how to meet the pollution reduction targets – including through cost-effective energy efficiency measures that save families money. Independent analyses of the Clean Power Plan have found that average bills could decline by as much as 11 percent as a result of these measures. That’s why leading consumer and ratepayer advocates, including Consumers Union, support the Clean Power Plan.Our vibrant clean energy sector employs millions of Americans and it is thriving.
According to a recent assessment by Advanced Energy Economy, the United States clean energy sector is now a rapidly-growing, $200 billion industry that employs 3.3 million Americans.Clean energy is creating economic opportunities in communities across the nation.
The American Wind Energy Association estimates that 70 percent of wind farms are located in low-income counties, and that wind developers currently pay $222 million a year in lease payments to U.S. farmers, ranchers and other rural landowners. AWEA also estimates that wind energy has created more than 25,000 manufacturing jobs in 43 states.The Administration’s promises that revoking climate and clean air protections will bring back coal jobs are false, as the coal industry itself recognizes.
Independent analyses have found that employment in the coal industry has been falling steadily since 1975, due largely to changing methods of coal production and – in more recent years – by competition from inexpensive natural gas. These trends cannot be reversed by revoking the Clean Power Plan or other protections for clean air and clean water. Even coal company executives have acknowledged that the executive order can’t bring mining jobs back.An extraordinarily broad and diverse coalition is supporting the Clean Power Plan in court.
This coalition includes, among others: eighteen states and sixty municipalities; power companies that own and operate nearly ten percent of the nation’s generating capacity; leading businesses like Amazon, Apple, Google, Mars, and IKEA; former Republican heads of EPA; public health and environmental organizations; consumer and ratepayer advocates; faith organizations; and many others.Large majorities of Americans in red and blue states alike support reducing climate pollution from existing power plants.
According to a recent national poll, 69 percent of Americans support placing limits on climate pollution from existing power plants – including a majority of Americans in every Congressional district in the country.The nation’s leading businesses support policies to reduce climate pollution.
Just this month, over 1,000 companies and investors called on the Trump Administration to continue low-carbon policies, noting that “failure to build a low-carbon economy puts American prosperity at risk” and that “the right action now will create jobs and boost U.S. competitiveness.”The Clean Power Plan rests on a rock-solid legal foundation.
The Supreme Court has held on three separate occasions that Congress has vested EPA with the responsibility – and the tools – to reduce carbon pollution under the Clean Air Act. Numerous legal experts – including drafters of the Clean Air Act, former EPA Administrators who served under Presidents Nixon, Reagan, and Bush, and former state energy and environmental officials – have affirmed the strong legal basis for the Clean Power Plan
Attacks on the Clean Power Plan and our other clean air protections present an unprecedented attack on our children’s health. It takes our nation backwards – to more pollution, more disease – even though Americans support forward progress towards clean air and clean energy.
http://energypost.eu/10-things-know-clean-power-plan/
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Apr 10, 2017 | Fuel Fix
By James Osborne
Standing at the front of a windowless room in downtown Washington last week, the Swiss energy economist Christoff Frei lectured on how the world’s energy sector is about to undergo an upheaval the likes of which has not been seen in a century.
Between the insurgence of electric cars, climate change policy and a host of economic factors, Frei posited the world’s thirst for oil might well peak within the next decade as society gets more and more of our energy from the power grid.
“Electricity is the new oil,” he quipped.
Asked what he was seeing that organizations including the International Energy Agency and Exxon Mobil are not, Frei, who was recently named secretary general of the inter-governmental group World Energy Council, turned coy.
“They do quite a wide range of scenarios,” Frei said. “But don’t quote me on IEA scenarios.”
Peak oil demand theory has quickly become the conversation du jour within the world’s energy corridors, following on from a surprise pronouncement by Royal Dutch Shell CEO Ben van Beurden in Houston earlier this year that their models showed demand potentially peaking as early as the late 2020s.
With so many companies and organizations offering different forecasts – or scenarios, depending on their confidence – predicting the world’s oil needs has become more a matter of art than science.
Economists like Frie argue that the long held correlation that with economic growth comes growth in energy demand is diminishing, as buildings and cars get more efficient and rapidly advancing digital technology allows humans to change their lifestyles. Think ride sharing instead of driving your own car or video conferencing instead of getting on an airplane.
Add in the growing shift to natural gas and improvements in renewable technology, and not only is oil’s market share shrinking but so is the market itself.
Yet the IEA, which has long served as a guiding light for the world’s oil industry, said last November that even with the Paris agreement on climate change oil demand would continue to rise through 2040 – mirroring predictions by the likes of Exxon Mobil.
Michael Lynch, a former researcher at the Massachusetts Institute of Technology who now runs the consulting firm Strategic Energy and Economic Research Inc., likens the buzz around peak oil demand to that around peak supply in the early 2000s.
At the time, Lynch drew angry criticism when he argued technology would ultimately win out and allow more oil to be accessed – as came to pass with the advent of hydraulic fracturing. Now, Lynch says, peak oil demand proponents are making too much of the impact digitization and renewables will have on energy demand.
“I was looking at air miles traveled, and the internet doesn’t seem to have made as much difference as people thought. It’s slowed a little in the U.S. but not in other places,” he said. “Let me ask you, When you saw this guy talk yesterday, was he present?”
What IEA is essentially counting on is that the trends of the oil industry’s entire existence – namely that energy consumption rises with economic growth – will continue. And with countries like China and India expected to grow their economies considerably in the decades ahead, it would make sense to assume they will need lots of energy to get there.
That isn’t proving out the way it used to, said Andrew Logan, director of oil and gas program at CERES, a nonprofit investment firm that advocates for corporate sustainability.
“IEA projections are always declining. Every year they have to notch it down. It’s pretty incredible they get it wrong year after year,” he said. “I don’t know the answer on when (oil demand peaks), but the way we look at it the future of energy is more uncertain than it’s been in a very long time.”
So why would a CEO like van Beurden openly discuss a decreasing demand for his product within the next decade when environmentalists are not entirely convinced the timetable is so short?
Lynch said he wasn’t sure, but he offered, “It sounds a lot sexier than we’re going to keep driving cars with gasoline and diesel for the next 30 years.”
http://fuelfix.com/blog/2017/04/10/is-peak-oil-demand-for-real/
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Carbon Emissions from Energy Sector Drop
Apr 10, 2017 | The Hill - E2 Wire
By Timothy Cama
Carbon dioxide emissions from the United States’ energy sector fell last year, due mainly to a significant drop in the use of coal.
The Energy Information Administration (EIA) reported Monday that energy-related emissions of carbon dioxide, the most common human-emitted greenhouse gas, were down 1.7 percent in 2016, compared with the previous year.
That came despite increases in the use of both oil and natural gas, and a resulting growth in carbon emissions from both fossil fuels.
The main reason for the emissions drop was an 8.6 percent decrease in pollution from coal, which resulted from a 1.3 percent decline in coal use, the EIA said.
“A significant reduction in coal use for electricity generation was offset by increased generation from natural gas and renewable sources,” the EIA explained.
“Renewables do not emit CO2, and a shift towards natural gas from coal lowers CO2 because natural gas has lower emissions per unit of energy than coal and because natural gas generators typically use less energy than coal plants to generate each kilowatt-hour of electricity.”
The weather was also a big factor in the emissions drop, according to the EIA. Warmer weather means buildings use less energy for heating, reducing the use of fuels that cause emissions.
Preliminary data show that the United States likely had an average 10 percent fewer days in 2016 when buildings had to use heat, when compared with the previous year. That would be the second-lowest number of such days since 1949, the EIA said.
http://thehill.com/policy/energy-environment/328070-carbon-emissions-from-energy-sector-drop
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Hundreds Comment on Atlantic Coast Pipeline EIS; Forest Service OKs Appalachian Trail Crossing
Apr 10, 2017 | Natural Gas Intelligence
By Charlie Passut
The U.S. Forest Service (USFS) told FERC that a proposal to use horizontal directional drilling (HDD) to construct the Atlantic Coast Pipeline (ACP) -- to avoid impacts to the Appalachian Trail and the Blue Ridge Parkway -- is feasible, and it would not object to concurrent construction through other forest lands before the crossing is completed.
Meanwhile, the U.S. Environmental Protection Agency (EPA) recommended that FERC conduct further analysis before releasing its final environmental impact statement (EIS) for the project [CP15-554]. The Department of Interior (DOI) also voiced several concerns, including potential disturbance to its stream gauges along the proposed pipeline's route.
The comments by the federal agencies were among nearly 800 filed at the Federal Energy Regulatory Commission on Thursday -- the official last day for public comments on its draft environmental impact statement (DEIS) for the project -- and through mid-day on Friday.
In a letter dated last Tuesday, USFS said it had reviewed Atlantic Coast Pipeline LLC's proposal to use HDD as the primary method to cross the Appalachian Trail and Blue Ridge Parkway, as well as the company's contingency method to use direct pipe installation (DPI) for the crossing.
"ACP's filings contain sufficient information to assess the feasibility of the proposals. Based on the USFS' review, the HDD would be feasible at the proposed location and the DPI would be a feasible contingency option," wrote USFS Forest Supervisor Clyde Thompson. He added that USFS had no further questions or requests regarding the crossing.
In January 2016, USFSdenied ACP a special use permit (SUP) to cross the Monongahela and George Washington national forests in West Virginia and Virginia. Thompson said USFS told FERC at the time that since ACP had not yet submitted any detailed proposals, any SUP issued to ACP may be conditioned to require successful completion of HDD at the crossing -- essentially halting any concurrent construction across forest lands elsewhere.
But Thompson said USFS has since decided to drop that condition.
"Because ACP subsequently filed adequate documentation for the USFS to assess the feasibility of the primary and contingency proposals, and based on our independent assessment that the proposals are feasible, such a condition in the SUP would no longer be necessary," Thompson said. "Thus, the USFS would not prohibit concurrent construction at other spread on [National Forest System] lands before the completion of the [Appalachian Trail and Blue Ridge Parkway] crossing."
EPA, DOI voice concerns
In a separate letter, EPA Region 3, based in Philadelphia, told FERC that its final EIS for the project would be strengthened if it conducted additional testing and analysis on geology and soils, streams and wetlands, and groundwater and drinking water protection.
Specifically, EPA said the project will likely encounter "challenging geologic conditions," and that blasting -- coupled with steep slopes, karst topography, and active and abandoned mines and quarries along the project's route -- pose additional challenges to protecting local residents and their sources for drinking water.
"EPA appreciates the special consideration that crossing karst streams and terrain has received in the DEIS," the EPA said. "In light of the DEIS, which indicates over 50% of karst hazards throughout the 71 miles of karst terrain crossed are identified as 'high risk,' we recommend the final EIS consider ecological risks to karst systems, and risk mitigation that includes avoidance measures."
EPA also recommended that the final EIS complete ongoing wetland and stream surveys, and offered to assist in that endeavor. Other recommendations included considering alternative crossings for the Neuse River; the inclusion of various studies on the impacts to watersheds and ecosystems; and additional analysis of cumulative impacts, especially on groundwater, stream crossings and water withdrawals.
DOI also voiced concerns in another letter to FERC. Its "greatest concern" is that the ACP will cross the South River upstream of Waynesboro, VA, at a point less than five miles from a former textile plant that discharged high levels of mercury waste between 1929 and 1950. DOI said mercury in the streambed could be disturbed when a trench for the pipeline crossing is built.
"If the pipeline route were altered again to where it crossed the South River downstream of this site, or disturbed contaminated areas, the high potential for mercury release could become a critical environmental issue," DOI said. "Total mercury should be quantified upstream and downstream of the crossing point as an essential element of the water quality monitoring conducted before and after installation of the pipeline."
DOI added that it was concerned over potential impacts to eight stream gauges operated by its U.S. Geological Survey (USGS) located within one mile of the pipeline route or access roads. The USGS uses the gauges to measure water quantity and quality for a variety of purposes.
Other concerns raised by DOI include alerting towns along the pipeline route of construction activities upstream of their public water supply intakes; impacts to drinking water wells; potential damage to nearby pipelines and other structures from blasting; the potential for landslides from construction in steep-sloped areas; and potential impacts to aquatic species.
Backed by a joint venture between Dominion, Duke Energy and Southern Company Gas, ACP aims to transport 1.5 Bcf/d of natural gas from the Marcellus and Utica shales to satisfy heating and electric generation demand in the Southeast. The project is around 96% subscribed under long-term commitments.
ACP filed with FERC for a Natural Gas Act certificate in 2015. Originally it was targeting a 2018 start-up, but the denial of an SUP by USFS caused Dominion to push the in-service date to 2019.
Earlier this month, a bipartisan group of lawmakers from all three states the pipeline will traverse sent a letter to FERC, urging the agency to approve the project. Separately, a labor union also hand-delivered nearly 1,600 letters of support to the offices of Virginia’s two senators, both Democrats, Tim Kaine and Mark Warner.
http://www.naturalgasintel.com/articles/110063-hundreds-comment-on-atlantic-coast-pipeline-eis-forest-service-oks-appalachian-trail-crossing
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Renewable Energy Tax Credits Challenge Markets
Apr 10, 2017 | Houston Chronicle
By Chris Tomlinson
In the spring and fall, the wind blows so hard at night that wind turbines supply all of the power that Texas needs in the wee hours of the morning.
More surprising is that all of that wind means the price of electricity turns negative. That's right, electric power is not just free, but generators have to pay the grid operator to take their electricity.
Negative pricing can occur because Texas and other states operate a wholesale electricity market, where the grid purchases the cheapest electrons possible first. So the day before generators bid to supply the expected demand and ERCOT, which manages most of the Texas grid, buys the cheapest electricity.
Prices then adjust every 15 minutes in real time based on actual market and weather conditions.
Wind is more predictable than you might think, so Texas wind energy generators have bid negative prices into the market for for years now. But the newest surprise comes from the U.S. Energy Information Administration which reports that the same thing is now happening in California between 11 a.m. and 2 p.m., but this time it's solar power.Solar energy plants have been generating more than 40 percent of the state's electricity needs in late winter and early spring this year, and it's causing negative pricing in California's wholesale energy market.
How is it possible for wind and solar power to generate electricity at negative prices? Tax credits.
Federal law grants a $23 production tax credit for every megawatt hour of electricity produced by a wind turbine or a solar array that did not collect an investment tax credit. Solar projects can receive an investment tax credit worth 30 percent of the cost of the project, which brings down the cost of the power plant.
Theoretically, wind and solar generators can therefore pay grid operators up to $22 a megawatt hour to take their electricity and still make a profit. Before California began adding solar energy, average hourly prices in March ranged from $14 a megawatt hour to $45 a megawatt hour. Now it's less than zero.
That has companies that own coal, natural gas and nuclear power plants furious, because unlike renewable energy companies, they have to pay for their fuel costs and pollution control equipment to generate electricity. And coal and nuclear plants can't shutdown and restart quickly, which means they have to keep spinning even when prices go negative.
"Negative prices usually result when generators with high shut-down or restart costs must compete with other generators to avoid operating below equipment minimum ratings or shutting down completely," the EIA reports.
Coal and nuclear plant owners say they can't compete with tax credits and complain that they distort what is supposed to be a free and fair wholesale market.
"The current markets are not sustainable for an all-of-the-above strategy," Chris Crane, CEO of Exelon, the nation's largest competitive energy provider operating in 48 states, told the Energy Thought Summit. "When the government and the markets decided to pick winners and losers versus outcomes, it skews the market. In Texas ... the overemphasis on wind has destabilized this market significantly."
Not so fast, says John Hall, clean energy director at the Environmental Defense Fund. When Texas switched to a competitive wholesale market, and away from the old regulated market, the state gave traditional generators $6 billion in the early 2000s to make up for stranded resources. Federal tax laws still give fossil fuel and nuclear generators all kinds of advantages, just not tax credits.
"We say let's do away with all of the subsidies for everybody," Hall said. "We think bailing out coal again is bad public policy, and will have a huge economic impact on the state. The fact is that they can't compete."
It's easy to blame the negative pricing on wind and solar during the periods when they are most productive, but the truth is that the prices wouldn't go negative if coal and nuclear power plants could shut down at night. Their inability to switch on and off quickly is what creates the surplus electricity on the grid.
"The grid of the future will be flexible and composed of resources that can ramp up or down and still economically operate," Hall said. "Large base-load plants where you simply can't shut them down quickly and can't bring them online quickly, and that aren't price competitive with natural gas and renewables, are destined to fail."
We're already seeing this trend in the market place. Nuclear and coal plants are shutting down, natural gas plants are more popular than ever and 80 percent of the world's new generation capacity this year will be from renewable sources.
Two years ago, Congress voted to begin phasing out tax credits for wind and solar energy. The tax credits start dropping next year and all new projects after 2020 will receive none at all.
The big question is whether the fossil fuel and nuclear industries will be ready to give up their tax advantages too, or will they remain dependent on government handouts.
http://www.houstonchronicle.com/business/columnists/tomlinson/article/Renewable-energy-tax-credits-challenge-markets-11058236.php
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N.D. Loosens Reporting Standards for Oil Spills
Apr 10, 2017 | E&E Energywire
By Mike Lee
North Dakota has rolled back part of its strict reporting requirements for oil spills, just over three years after they were enacted.
Gov. Doug Burgum (R) on Friday signed H.B. 1151, which exempts companies that own newer wells and other facilities from reporting spills and other releases unless they are over 10 barrels (420 gallons) or the fluid escapes from a drill pad. Companies will have to continue reporting spills as small as 1 barrel if their equipment was installed before 2000.
Burgum said in a statement that the law "streamlines reporting requirements to match federal standards while continuing to hold industry responsible for cleaning up 100 percent of spills on or off oil well pads and saltwater disposal well sites."
The North Dakota Department of Health began publishing data online about spills in the state in the wake of a massive pipeline leak in 2013. State regulators at the North Dakota Industrial Commission knew about the 20,000-barrel leak outside the town of Tioga for a week before making it public or informing legislators (Energywire, Jan. 15, 2014).
Spills of oil and waste products like brine rose steadily during the first part of the decade as drillers rushed to develop the Bakken Shale oil field. The number of spills tapered off as producers standardized their drilling methods and state regulators cracked down (Energywire, May 12, 2014; Energywire, July 21, 2016).
https://www.eenews.net/energywire/2017/04/10/stories/1060052846
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NCDOT Obtains Grant to Reduce Locomotive Emissions
Apr 10, 2017 | Progressive Railroading
The North Carolina Department of Environmental Quality has awarded a $39,000 grant to the N.C. Department of Transportation's (NCDOT) Rail Division to continue work on minimizing air pollution from its locomotive fleet.
The grant will allow additional technologies to be added to the blended after-treatment system (BATS) that was installed and tested on the F59H Locomotive 1859, according to NCDOT's April rail report newsletter.
The BATS mitigates the four components of diesel exhaust known to be harmful to humans. The current system has migrated three of the four compounds to the Tier 4 emissions level required by the U.S. Environmental Protection Agency (EPA) for new locomotives. The fourth component, particulate matter, was lowered to Tier 3.
With the addition of the technology, NCDOT Rail Division officials anticipate achieving the EPA Tier 4 level for particulate matter, which will bring the department's F59PH 1859 Locomotive to the functional equivalent of new locomotives.
http://www.progressiverailroading.com/mechanical/article/NCDOT-obtains-grant-to-reduce-locomotive-emissions--51314
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Trump May Change or Scrap Obama Ozone Standard
Apr 10, 2017 | E&E Greenwire
By Amanda Reilly
The Trump administration is considering whether to change the national ozone standard set by the Obama administration in 2015, a court filing reveals.
On Friday evening, U.S. EPA filed a motion seeking to postpone next week's oral arguments over the standard, saying the new administration is "closely scrutinizing" whether the agency should "reconsider the rule or some part of it."
"The prior positions taken by the agency with respect to the 2015 rule may not necessarily reflect its ultimate conclusions after that review is complete," the EPA motion said.
Environmental and public health groups immediately blasted the request to delay the case.
"The Trump administration is taking the first step toward tearing down a crucial protection against dirty air," Earthjustice attorney Seth Johnson said in a statement. "We're going to fight this in court."
EPA in 2015 lowered the national ambient air quality standard for ozone from 75 parts per billion, which was set during the George W. Bush administration, to 70 ppb. Ozone is a key component of smog that's formed when nitrogen dioxide and volatile organic compounds react in sunlight.
At the time, the agency said the 75 ppb limit was no longer adequate to protect public health as the Clean Air Act required. It based its decision on a multiyear review of public health science.
EPA also set a 75 ppb secondary standard for ozone, a separate limit that is aimed at protecting ecosystems.
Industry entities, 10 states and environmentalists filed lawsuits over the rule in the U.S. Court of Appeals for the District of Columbia Circuit. But while industry says the 70 ppb limit is too strict and cannot be achieved around the country, environmental groups wanted the agency to set an even tighter standard.
The D.C. Circuit already rescheduled the arguments in the case from February to April 19. Last month, the court announced that lawyers would have 80 minutes to present the case.
While it has taken steps to undo the Obama administration's climate change agenda, the Trump administration has so far been relatively quiet on what it plans to do with the ozone standard.
EPA Administrator Scott Pruitt, though, was among the foes of the rule during his time as attorney general of Oklahoma.
At his confirmation hearing in the Senate Environment and Public Works Committee, Pruitt expressed concerns about lowering the standard when many areas of the country had not yet attained the limit set during the George W. Bush administration.
"Perhaps there should be focus on how to meet the level already in statute or already in rule," Pruitt said.
In Friday's motion, the Trump administration said it would need more time to review the standard given the "large and complex body of scientific, medical, and technical evidence" backing the Obama rule.
The new administration will determine whether the standards "should be maintained, modified, or otherwise reconsidered," the motion said.
If the court goes ahead with next week's arguments, lawyers for EPA would be "unlikely" to represent the agency's conclusive thinking on the standard, the government argued.
The agency asked the D.C. Circuit to either require it to file a status report in 90 days or to hold the case in abeyance until it decides what to do with the 2015 rule.
Separately, congressional foes of the Obama rule are seeking to delay implementation of the new limit until well into the next decade (E&E Daily, Feb. 2).
This morning, environmental and public health groups asked the court to reject the government's motion. EPA provided only a "thin excuse" for delaying the oral arguments, the American Lung Association, Natural Resources Defense Council, Sierra Club and others told the D.C. Circuit.
The groups also said that delaying the litigation would likely lead to a delay in implementing the 2015 standards. A ruling in the case would be relevant no matter what the Trump administration does with the standard, they said.
"Resolution of the important legal issues in this case could clarify the agency's authority in matters that will arise regularly," according to the response today in the D.C. Circuit.
Environmentalists further slammed EPA for filing the motion eight business days before the scheduled arguments — and 2 ½ months after the inauguration.
"EPA identifies no reason why it required so much time just to decide it wanted to have time to review the ozone standards," they said.
https://www.eenews.net/greenwire/2017/04/10/stories/1060052869
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Senators to Pruitt: How Will You Cut CO2 Now?
Apr 10, 2017 | E&E Climatewire
By Niina Heikkinen
Leading Democrats in the Senate and state attorney general offices are calling for greater transparency and more documents from U.S. EPA Administrator Scott Pruitt.
The requests follow recent moves by the Trump administration to roll back President Obama's climate policies. Liberal politicians and some conservatives have expressed concern that EPA has shifted its focus from protecting public health and the environment to shielding the financial interests of the private sector.
Senate Environment and Public Works ranking member Tom Carper (D-Del.), along with 22 other senators, sent a letter to Pruitt on Friday requesting the administrator lay out how the agency will meet legally required controls of carbon emissions without the Clean Power Plan.
In the letter, the senators say EPA has a "clear obligation" to limit CO2 emissions. They cite the 2009 endangerment finding by then-EPA Administrator Lisa Jackson, which established that greenhouse gases were harmful to human health and welfare and laid the groundwork for the Clean Power Plan.
They also defended the process for implementing the plan for limiting carbon emissions from coal-fired power plants, saying it was the result of two years of outreach and public comment from states, the electric power sector and the general public.
"The Clean Power Plan provides both long-term certainty for our nation's power sector, and tools to enable the more than two dozen states that have policies either limiting power sector CO2 emissions, or expanding renewable energy, to integrate those policies with a national program," the letter reads. "Rescinding the Clean Power Plan also means that Americans will never realize its numerous health and economic benefits."
The senators requested a clear timeline for when the agency planned to follow through with the directives in President Trump's "energy independence" executive order, signed late last month, including any alternate plans the administration might have for limiting CO2 emissions.
They also requested any relevant documents outlining how EPA would follow through with the administration's plans, as well as any evidence that rescinding the Clean Power Plan would lead to the opening, construction or expansion of coal mines and coal-fired power plants.
The same day, California Attorney General Xavier Becerra (D) filed a Freedom of Information Act request with EPA, seeking documents outlining the administrator's potential conflicts of interest.
The FOIA included 32 categories of documents, such as documents or communications related to the ethics agreement he filed before being confirmed as EPA administrator.
The attorney general also sought any information on ethics waivers or communication about anything that might disqualify Pruitt for the position or require him to recuse himself from taking action as administrator.
"The public has a right to know whether Administrator Pruitt and EPA are complying with federal ethics laws," Becerra said in a press release Friday. "Mr. Pruitt's numerous conflicts of interest merit close examination now that he has taken a direct role in initiating reviews of numerous EPA regulations he sought to undo through litigation in his previous role."
https://www.eenews.net/climatewire/2017/04/10/stories/1060052836
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Skeptics Pressure Pruitt to Undermine Climate Science
Apr 10, 2017 | E&E Greenwire
By Hannah Hess
A group of homeowners concerned about how a government-mandated shift toward renewable energy sources might affect their electric bills has petitioned U.S. EPA for reconsideration of the agency's finding that greenhouse gases "endanger" public health and welfare.
The Concerned Household Electricity Consumers Council, represented by attorney Francis Menton, announced last week that it filed its petition on Jan. 20, the day of President Trump's inauguration.
The council, which stated it receives no funding from any industry source, sides with far-right critics of Obama-era climate policies. Attorneys for the Competitive Enterprise Institute have also asked Administrator Scott Pruitt to revisit the 2009 finding that set the stage for the previous administration's suite of greenhouse gas regulations (Greenwire, March 31).
Council members include economist James P. Wallace III and climatologist Joseph D'Aleo, who forecasted "global cooling" in the 2008 edition of "The Old Farmer's Almanac" (Climatewire, Oct. 14, 2008). Both Wallace and D'Aleo have criticized EPA's authority in past court battles. Three Supreme Court decisions have affirmed EPA's authority to regulate greenhouse gases under the Clean Air Act.
"Each of CHECC's members is a citizen of the United States and a member of a household that pays a monthly electricity bill to a utility that in turn is regulated by EPA," the brief states, arguing those bills will inevitably increase over the coming years by many thousands of dollars per year.
The petitioners claim that the Trump administration's review of the Clean Power Plan does not go far enough. If the endangerment finding is not vacated, they say, it is certain that electric utilities and many other industries will face ongoing regulation of their carbon dioxide emissions by EPA.
Democrats fight back
The petition is based in part on a Sept. 21, 2016, research report by Wallace, D'Aleo and John Christy, an atmospheric scientist at the University of Alabama, Huntsville, who has called into question the full extent of humanity's role in global warming. It presents an analysis that seeks to invalidate the scientific consensus that increased concentrations of greenhouse gases in Earth's atmosphere are the primary driver of climate change.
"The scientific invalidity of the Endangerment Finding is now obvious, undeniable and easily demonstrated. It is time for an honest and rigorous scientific re-evaluation of this Obama-era political document," Menton wrote in a news release.
Menton, a Manhattan-based attorney who has argued on behalf of the conservative Federalist Society, did not respond today to questions from E&E News.
Pruitt signaled in a recent interview with Breitbart News Network that he would be willing to revisit the endangerment finding. EPA did not comment on the topic today.
Pruitt concluded in a widely panned March 9 interview with CNBC, currently under investigation by the agency's scientific integrity official, that CO2 is not the main driver behind climate change.
Top Democrats in the Senate and state attorney general offices have made it clear they will hold the former Oklahoma attorney general to the legal obligation to address carbon pollution emissions.
Senate Environment and Public Works Committee ranking member Tom Carper (D-Del.) led a letter with 22 of his colleagues Friday requesting that Pruitt lay out how the agency will meet legally required controls of CO2 emissions without the Clean Power Plan. They cite court decisions affirming EPA's authority, and the endangerment finding by then-EPA Administrator Lisa Jackson.
The senators requested Pruitt provide a copy of all documents, including hand-written notes, paper files, telephone logs or meeting minutes, related to his decisionmaking on the Clean Power Plan.
California Attorney General Xavier Becerra (D) filed a request under the Freedom of Information Act on Friday seeking communications from Pruitt discussing EPA's greenhouse gas regulations and documents that might show Pruitt's past ties to the fossil fuel industry.
"The public has a right to know whether Administrator Pruitt and EPA are complying with federal ethics laws," Becerra said in a statement. "Mr. Pruitt's numerous conflicts of interest merit close examination now that he has taken a direct role in initiating reviews of numerous EPA regulations he sought to undo through litigation in his previous role."
https://www.eenews.net/greenwire/2017/04/10/stories/1060052872
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Agency Touts Perry's Carbon-Cutting Cred
Apr 10, 2017 | E&E Climatewire
By Umair Irfan
The Department of Energy is celebrating Secretary Rick Perry's record of reducing greenhouse gases during his term as governor of Texas.
The boast was part of a "Get to Know Energy Secretary Rick Perry" video the agency posted Friday. It came ahead of a weekend trip to Rome for a meeting with energy ministers from Group of Seven countries: Canada, France, Germany, Italy, Japan, the United States and the United Kingdom (E&E News PM, April 7).
During his 15-year tenure as the longest-serving governor of Texas, Perry presided over a massive expansion of energy production, making Texas the nation's largest producer of oil, gas and wind energy.
At the same time, Texas experienced declines in air pollutants including nitrogen oxides, sulfur oxides and carbon dioxide while the state's population grew by 5.6 million people and the state's economy added 1.3 million jobs.
Raising carbon dioxide reductions as a point of pride is odd from someone who described climate change as "all one contrived phony mess," a point Perry himself acknowledged at a 2015 speech before the Conservative Political Action Conference.
"[W]e decreased our nitrogen oxide levels — which, by the way, is a real pollutant, it's a real emission — nitrogen oxide levels were down by 62 ½ percent, ozone levels were down by 23 percent, sulfur dioxide levels down by 50 percent, and our CO2 levels were down. Whether you believe in this whole concept of climate change or not, CO2 levels were down by 9 percent in that state," he said.
During his confirmation hearing, Perry softened his tone on climate change, acknowledging that human activity plays a role, but would not state to what extent.
However, Perry, as leader of the largest science agency in the United States, has not found much company for even this delicate rhetorical compromise in the Trump administration.
White House budget director Mick Mulvaney described funding climate change responses as "a waste" in a press conference last month.
This may become a point of tension between the United States and other countries looking to make good on promises to cut back on greenhouse gas emissions.
Perry's trip to Rome overlapped with Secretary of State Rex Tillerson's participation in the G-7 foreign ministers' meeting in Lucca, Italy. The meetings are meant to tee up an agreement due from the G-7 leaders' meeting next month in Taormina, Italy, which may include language on climate change and fossil fuel subsidies.
DOE did not respond to a request for comment.
https://www.eenews.net/climatewire/2017/04/10/stories/1060052837
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US Delays G7 Climate Statement
Apr 10, 2017 | The Hill - E2 Wire
By Devin Henry
Nations attending a G7 summit could not release a joint climate statement at the end of a meeting this week because the Trump administration is reviewing its policies.
Energy Secretary Rick Perry attended the G7 energy summit in Rome this weekend. But Italian officials said the U.S. was not able to sign a joint declaration about shared economic goals.
“The United States is in the process of reviewing many of its policies. This includes a review of policies relating to climate change and the Paris agreement," Italian Industry Minister Carlo Calenda said, Reuters reported Monday.
“While this is under way, the United States reserves its position on these key priorities. ... It was not possible to sign a joint declaration since it would not cover the whole range of topics in the agenda.”
The Energy Department did not immediately return a request for comment.
Trump and his administration are reassessing the commitments former President Barack Obama made via international climate agreements during his administration, including the U.S.’s involvement in the landmark Paris climate deal reached in 2015.
European officials told the Financial Times that they had hoped to include language related to the G7’s involvement in the Paris deal as part of the group’s joint declaration, but that the U.S. delegation objected.
Miguel Arias Cañete, the European Union’s energy and climate commissioner, tweeted Monday that “while some review their climate and clean energy policies, most of us move forward and implement them in line with [the] Paris agreement.”
In his own readout from the Rome meeting, Perry didn’t address the issue regarding the joint climate statement or the Paris agreement.
But he reiterated the position that he and Trump take, that fossil fuels can still be used while the environment gets cleaner.
“I discussed with my fellow ministers that the Trump administration believes that economic growth and the environment can successfully go hand-in-hand,” Perry said in his statement.
“As the [International Energy Agency] shared with us during the meeting, renewables will continue to have an important role but traditional sources are still needed for energy and economic security into the foreseeable future,” he continued. “Therefore, we believe it is wise for countries to use and pursue highly efficient energy resources.”
http://thehill.com/policy/energy-environment/328098-us-delays-g7-climate-statement
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Environmentalists Say EPA Lacks Legal Basis to Delay Ozone NAAQS Suit
Apr 10, 2017 | Inside EPA
By Anthony Lacey
Environmentalists are urging a federal appeals court to reject EPA's request to delay April 19 oral argument in litigation over the Obama-era decision to tighten the federal ozone limit, saying the agency's “thin excuse” to postpone argument while it weighs potential reconsideration of the rule falls far short of the legal basis for a delay.
“EPA has failed to provide the requisite 'extraordinary cause' for postponing the argument,” says an April 10 response filed by environmentalists to the agency's April 7 request for the U.S. Court of Appeals for the District of Columbia Circuit to delay the case, Murray Energy Corporation v. EPA. They argue that the fact an agency might in the future reconsider a rule is inadequate justification to postpone litigation over an existing rule, and also say public health would be harmed as a halt would also delay health benefits expected from the ozone limit.
The agency in its motion says it intends to “closely review” the Obama EPA's October 2015 final rule that tightened the ozone national ambient air quality standard (NAAQS) from 75 parts per billion (ppb) to 70 ppb. “[T]he prior positions taken by the Agency with respect to the 2015 Rule may not necessarily reflect its ultimate conclusions after that review is complete,” and argument should therefore not take place during the review, EPA says.
EPA claims that if the argument takes place as scheduled April 19, the agency's counsel would “likely be unable to represent the current Administration's conclusive position on the 2015 Rule. Nor would it be proper for counsel for EPA to speculate as to the likely outcome of the current Administration's review.”
According to the motion, the agency also needs more time to assess whether the ozone NAAQS decision is subject to President Donald Trump's March 28 executive order (EO) directing EPA to reconsider rules that could burden energy development. It argues that the time needed to reconsider the rule warrants delaying oral argument, with status reports due 90 days after a court order granting the delay, and at 90 day intervals after that.
Alternatively, the agency asks the court to hold the consolidated litigation in abeyance until it files a notice with the court indicating that it has decided to either reconsider all or part of the rule, or to maintain it.
Ozone Litigation
Several states and industry groups filed suit in the D.C. Circuit challenging the decision to tighten the NAAQS, arguing the agency lacked a scientific basis for the decision and that the rule would impose massive costs.
Environmentalists also sued but claimed the standard should have been set even stricter at 60 ppb, although they are intervening on EPA's behalf to defend the decision to tighten the limit from 75 ppb to 70 ppb.
In their motion opposing the delay, the environmentalists and public health groups say that EPA's need to review whether the ozone NAAQS is “potentially” subject to Trump's EO is “double speculation” that fails the federal appellate courts' “extraordinary cause” requirement for postponing oral argument in a case.
They also argue that even if the Trump EPA does not agree with the stricter ozone limit, that it no reason for granting delay. “That the agency may have to defend a rule that may not entirely accord with the new Administration's views is not extraordinary; it is routine under the rule of law,” they say.
EPA also failed to file its request “reasonably in advance of the hearing date” as required by circuit court rules, they claim. “It comes only eight business days before the argument -- but two and a half months after Inauguration Day, and five months after Election Day. EPA identifies no reason why it required so much time just to decide it wanted to have time to review the ozone standards,” says the response.
Environmentalists add that delay to allow reconsideration of the rule would also likely postpone implementation of the stricter ozone NAAQS and its expected health benefits. They say EPA has not shown any “pressing need” for delay that would outweigh the need to protect public health.
https://insideepa.com/daily-news/environmentalists-say-epa-lacks-legal-basis-delay-ozone-naaqs-suit
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A Glimpse into the Future of Environmental Policy
Apr 10, 2017 | Forbes
By Simon Flowers
What will the energy world look like in twenty years time and beyond? Advances in technology and environmental policy are among the factors influencing demand growth and shaping what may be a very different energy mix in the future.
Our Energy view to 2035, led by Paul McConnell of our Global Trends team, distils the work of our team of analysts working across energy commodities. Five main themes leap out.
First, India’s emerging lead role in global energy demand growth. China has been the mainstay for two decades or more and will still be the world’s biggest consumer of energy for the foreseeable future. But China’ s economy is pivoting away from industrialisation towards services. Environmental policy, focusing on clean air in particular, will also slow the rate of energy demand growth.
India will take over the mantle, becoming the biggest growth engine in the 2020s.
An economic focus on manufacturing will spur demand growth at 3% CAGR through 2035. Energy security is India’s concern, as an importer of oil and gas; a planned rapid build-out of solar and wind capacity provides just part of the answer.
Second, ‘lift off’ for zero carbon energy. Energy systems are being transformed by the rapid progress of technology and by regulation. Globally, carbon intensity and energy intensity have already peaked and will trend down through 2035. But the revolution, with the Paris Agreement a signal moment, has only just begun and carbon emissions continue to rise over the period. Developing economies’ dependence on coal is one of the factors. But China is already showing how swiftly change can come as an energy intensive/high emissions developing economy matures. Other high growth economies will follow the same path, in time.
Third, transportation goes electric. It’s not going to happen quickly, but it will certainly happen. We aren’t believers in peak oil demand, at least not yet - oil dominates the transportation sector and will still do so in 2035. Electric vehicles have come a long way in the last year or two, in aspiration at least. But there are many barriers to entry, not least battery technology, cost, government policy – and inertia. We expect just 2 million b/d or 2% of oil demand is lost to EVs by 2035.
A tipping point will eventually come, but when?
The oil industry is beginning to grasp the nettle, the Majors investing in renewables to build optionality for future proofing. The fundamentals aren’t there yet for a decarbonised transport sector. But air quality initiatives in China and other emerging markets, and the audacious entrepreneurial zeal of the tech sector point to disruption some time down the line.
Fourth, the power sector’s influence on the changing commodity mix. Gas demand will grow by 41% over the next two decades, overtaking coal as the second most consumed energy source by 2030. The rise of gas consumption is a global phenomenon; as increasingly is renewables which are set to triple their share of energy supply to 13% from 2015 to 2035. Coal will remain vital to global energy supply through the period, but incremental demand growth is isolated to India, South Korea and SE Asia, as environmental policy and competition from other fuels eat into traditional OECD coal heartlands.
Fifth, shifting regional supply dynamics. We expect the US to be energy independent by 2021 and a near Saudi Arabia-scale exporter (oil and gas combined) by 2035. The EU in contrast becomes increasingly reliant on imports. Climate change policy and other regulation are dampening demand in Europe, but indigenous oil and gas production continues to decline long-term. Asia Pacific supply is set for rapid growth, driven by gas and to a lesser extent coal; whereas oil is in decline.
Most of these themes are only just emerging, and the energy mix in 2035 may not be vastly different to what it is today.
But there is, presently, the sense of an incipient paradigm shift in energy consumption with decarbonisation at the centre - the global energy mix will look very different by 2050.
Adjusting for what the world may look like more than 20 years from now is perhaps the biggest strategic challenge ahead for energy producers. Quite what the right business model is won’t be clear perhaps for some years. But adjust they must, and build optionality for changes that will surely come.
https://www.forbes.com/sites/woodmackenzie/2017/04/10/and-the-strategic-challenge-for-energy-producers/#2081bd931197
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