Energy and Environment News

Energy and Environment News

November 25, 2014

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EPA.  The U.S. Supreme Court agreed to hear industry and state arguments against the EPA’s proposed Power Plant Mercury Rule with an expected ruling date in June of next year.  Opponents of the rule — including industry trade groups and two dozen states — argue that the EPA violated the Clean Air Act by not considering compliance costs earlier in the regulatory process.  Bloomberg

Oil.  The Wall Street Journal reports that OPEC members are close to reaching a compromise that would lead to oil supply cuts.  Such an agreement would hinge on tighter compliance with existing OPEC output limits rather than an additional cut to its production target, amounting to a cut of around 300,000 barrels of oil per day compared with October supply levels.  WSJ

Energy Policy.  The Financial Times reports that Germany’s Energiewende (“energy change”) policy has created an environment where Berlin must rely on electricity generation from coal-fired power stations due to the unreliability of renewable sources and the exit of nuclear capacity.  Additionally, the cost of the program’s green-energy subsidies have increased electricity costs for consumers more than 30% in four years, placing great pressure Germany’s global economic competitiveness.  FT

Oil.  In the Wall Street Journal, two energy experts debate the decades-old U.S. ban on oil exports.  Jason Bordoff, former energy adviser to President Obama, asserts that the oil-export ban should be lifted because it will allow the U.S. to better respond to global prices and temper supply shocks with negligible and even negative impact on U.S. oil prices.  Tyson Slocum, director of the Energy Program at Public Citizen, argues that the ban should be maintained in order to insulate the economy from supply disruptions abroad and asserts that research suggesting insignificant price impacts is suspect.  WSJ

Energy and Environment News

Energy and Environment News

November 24, 2014

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Energy Policy.  In an interview with two energy policy experts about the political climate for forthcoming national energy policy, the Wall Street Journal found that much gridlock is to be expected next year.  In general, Republicans are looking to pull back on new carbon-pollution standards, approve the Keystone XL pipeline, and lift the ban on crude-oil exports, and significant push-back is expected on all accounts from Democrats in Congress and President Obama.  WSJ

Solar & Wind.  The New York Times reports that electricity from wind and solar power plants became cheaper than coal or natural gas in some U.S. markets last year.  New technologies and innovative approaches to financing and operations have helped both industries lower costs over the past five years, although industry experts warn that neither renewable source is likely to replace conventional power plants anytime soon.  NY Times

Biofuels.  The EPA announced on Friday that it will postpone a rule detailing levels of biofuel required to be blended into conventional vehicle fuels. Industry analysts note that much of the motivation for biofuel mandates is gone, particularly because American dependence on foreign oil has waned and supplies of advanced biofuels have fallen short of the mandate’s requirements.  NY Times

Keystone XL.  An op-ed in the Financial Times asserts that debates surrounding the Keystone XL pipeline have been wildly exaggerated both in terms of its modest economic benefits and implications for the global climate.  The author asserts that though the benefits and environmental costs are overstated, the pipeline should be approved because it will provide a friendly supply source and a more secure route for oil to reach the US in the event of an international crisis.  FT

Energy and Environment News

Energy and Environment News

November 21, 2014

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Oil.  Venezuela announced that it would be willing to cut oil production if OPEC decides to limit output when it meets later this month.  According to oil industry analysts, there is increased likelihood that OPEC will agree to reduce production, so long as financially-strained members such as Venezuela continue to push for higher oil prices.  Reuters

Energy Security.  The Federal Energy Regulatory Commission (FERC) issued a new rule yesterday that will require U.S. utility companies to protect important electrical equipment from potential attackers by identifying key transmission substations and hubs that could cause blackouts if knocked out.  Utility companies forecast spending hundreds of millions of dollars in security upgrades over the next several years to improve defenses.  WSJ

Climate Policy.  Jeffrey Frankel, a professor at Harvard University, examines the historic relationship between individual countries’ emissions reduction targets and per-capita incomes.  He finds a significant statistical relationship between these two variables — an average 10% increase in per-capita incomes for each 1.4% cut in emissions — which he suggests could be used as a historical “yardstick” from which to gauge the level of burden countries should bare in future climate policy negotiations.  Project Syndicate

Energy and Environment News

Energy and Environment News

November 20, 2014

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Climate Change.  United Nations scientists reported that new greenhouse-gas targets from the U.S., China, and European Union will not be enough to significantly limit climate change in the next century.  The UN scientists will release another report in March with a more formal assessment of the likelihood that the world will surpass the 2-degree “red line” of global warming.  WSJ

Keystone XL.  The Wall Street Journal reports that the fate of the Keystone XL pipeline may lie in constitutional questions surfacing in Nebraska regarding legal terminology and the right of state officials to approve its route.  If the Nebraska court rules in opposition of the state officials, the Keystone decision may remain unresolved for one year or more; if the court rules in favor, President Obama will likely be able to make a decision on the issue very quickly.  WSJ

Energy Outlook.  Yesterday China released details of a new energy strategy aiming to cap coal consumption by 2020 as part of efforts to meet the goal of peak carbon dioxide emissions in 2030.   Independent researchers have confirmed that this 2020 target is consistent with China’s slowing rate of growth in coal use.  NY Times

Energy Policy.  Christopher Flavelle reviews the “Secret Science Reform Act” — a bill up for a House vote tomorrow that aims to prohibit the EPA from issuing regulations “based upon science that is not transparent or reproducible”.  Flavelle asserts that the bill calls for disclosure of information that is often illegal and that such data reporting requirements are prohibitively expensive — two outcomes that would undoubtedly result in far fewer EPA rules, but also more litigation and rules based on fewer studies.  Bloomberg

Energy and Environment News

Energy and Environment News

November 19, 2014

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Keystone XL.  Legislation to approve the Keystone XL pipeline was one vote shy of passing through the Senate last night.  All 45 Senate Republicans voted in favor of the bill, and promised to bring the pipeline up for a vote as one of their first acts upon taking control of the Senate in January.  WSJ

Oil.  Economists at the Financial Times examine the U.S. supply-side implications of the recent slump in oil prices and suggest that so long as oil prices don’t fall much further, almost all of the “hit” to oil companies’ profits will be borne by shareholders who consume little of their income.  If prices continue to decline, some analysts argue that U.S. production and exploration cannot be sustained; others note that rapidly improving technologies have the potential to push production costs lower yet.  FT

Energy Policy.  Eduardo Porter of the New York Times argues that a carbon tax is the “one tool available to trim carbon emissions on a relevant scale” by offering both businesses and individuals a monetary incentive to reduce their use of fossil fuels and invest in alternatives.  Porter asserts that these investments are needed to spur the development of carbon capture and storage, cheaper renewable fuels, and new “green” energy technologies — all of which will be required to stay on the “safe side” of climate change.  NY Times