Energy and Environment News

Energy and Environment News

June 2, 2015

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Energy Policy.  In prepared remarks at a hearing today, Representative Fred Upton (R-MI), chairman of the House of Representatives’ energy panel, endorsed lifting the 40-year-old ban on U.S. oil exports.  Representative Upton’s backing will likely boost support for legislation to overturn the restriction, which currently has 40 co-sponsors in the House.  Reuters

Oil Outlook.  The Wall Street Journal reports that access to “easy money” has allowed U.S. oil companies to avoid liquidity problems and has kept U.S. crude production from falling sharply in recent months.  Investment analysts report that this oil-price downturn is inherently different from the episode of the 1980s due primarily to historically low interest rates, which have made drilling activity attractive to investors despite low prices.  WSJ

Climate Change.  In a united stand against coal use, Europe’s largest oil companies announced to industry officials that their increased production of natural gas could help to reduce carbon emissions and lessen the world’s reliance on coal for heating homes and creating electricity. In response, officials from the coal industry defended the resource’s role in the global energy mix, highlighting the potential of advanced technologies and the importance of the fossil fuel for developing countries.  WSJ

Climate Change. According to a recent study from the International Center for Integrated Mountain Development, the Everest region of Nepal could lose most of its glaciers as the planet continues to warm.   Using a climate model, the study’s authors find that moderate reductions in greenhouse gas emissions could result in a 70 percent loss of glaciers around Mount Everest; however, if emission levels remain at current levels, glaciers in the region could virtually disappear

Energy and Environment News

Energy and Environment News

June 1, 2015

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Climate Change.  Executives from six of Europe’s largest oil and gas companies have jointly called for a carbon pricing agreement at the United Nations-led summit on climate change this December.  In letters to the Financial Times and UN Framework Convention on Climate Change, the CEOs contend that a global carbon pricing system will discourage the use of carbon-based energy and “help stimulate investments in the right low carbon technologies and the right resources at the right pace.”    FT

Oil.  The Wall Street Journal reports that OPEC’s vow to maintain current production levels is a clear indicator that its pricing power has significantly diminished in recent months.  Amid excess global supply and faltering global demand, industry observers note that geopolitics between OPEC countries and heightened competition from non-OPEC rivals have reduced the group’s ability and desire to cooperate.  WSJ

EPA.  The EPA is expected to propose new regulations to cut greenhouse gas emissions from heavy-duty trucks later this week, requiring that the trucks increase their fuel economy by up to 40% by 2027 relative to 2010 levels.  While new rules are expected to add up to $12,000 to $14,000 to the manufacturing cost of new tractor-trailers, EPA expects the added cost to be recouped in fuel savings within the first two years.  NY Times

Oil.  As global oil prices begin to slowly tick upward, nearly 100 U.S. shale oil producers are weighing the decision to resume new drilling activity to capture revenues lost during the recent price decline. Producers are hesitant to ramp up production and contribute to another slump in the fragile global market; nonetheless, industry analysts predict that the rig count will begin picking up again in the third quarter and gain momentum in the fourth quarter, with a full recovery as early as 2016.  Reuters

Energy and Environment News

Energy and Environment News

May 29, 2015

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EPA.  The Environmental Protection Agency released a long-awaited proposal today regarding the amount of biofuel that must be blended into conventional vehicle fuel, recommending that the total volume of renewable fuel required by the Renewable Fuel Standard increase by 1.5 billion gallons, or 9%,  by the end of 2016.  While the EPA views the proposal as a positive step forward in improving the standard, opponents in Congress are less optimistic and suggest that the mandate be overhauled completely.  NY Times

Oil.   Struggling to offload cargoes amid persistent global surplus,  sellers of North Sea and West African “Dated Brent” are now offering the biggest discount on this grade since December 2008.   Because Dated Brent is used to price two-thirds of the world’s physical oil supplies, many traders and analysts are concerned about another large drop in oil futures prices. FT

Climate Change.  A group of Brookings scholars highlights the progress of Latin American countries leading up to the global conference on climate change in Paris this December.  The authors assert that while the region has achieved high levels of human development while emitting relatively small amounts of greenhouse gas emissions, policies that promote renewable energy and sustainable management of natural resources remain key to these nations’ paths forward.  Brookings

Oil.  Yesterday, the Obama administration issued a limit on petroleum drilling and other activities on land in the American West that is inhabited by grouse.  This move — which includes a collection of 14 land-management plans spanning 10 states — represents an effort to prevent the bird from becoming an endangered species, following warnings in 2010 from the federal Fish and Wildlife Service.  NY Times

Energy and Environment News

Energy and Environment News

May 28, 2015

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Energy Outlook.  According to U.S. Energy Secretary Ernest Moniz, Mexico’s recent energy overhaul may prove to be  a bigger boon to the integration of U.S. and Mexican power utility systems than the opening of the country’s oil industry. Moniz reports that the recent overhaul will better link cross-border utilities and natural gas pipelines, with additional opportunities for clean energy sources such as nuclear power.  Bloomberg

Climate Change.  The Financial Times reports that a growing number of companies and senior executives are “leading the fight against climate change” in the lead-up to the international climate conference in Paris this December. The Financial Times reports that while some companies have adopted internal carbon prices, others have increased efforts to incorporate risks associated with climate change into their decision-making and have made pledges to increase investments in “green” technologies.  FT

Oil.  In a draft report of OPEC’s long-term strategy, the producer group reports that the North American oil boom has proven “resilient” despite low oil prices, and suggests that the global oil glut could persist for another two years.  Furthermore, the long-term report identifies North American shale plays — which have demonstrated high short-term price elasticity and short lead-times in ramping up production —  as the potential new “swing producer” of the global market.  Reuters

Energy and Environment News

Energy and Environment News

May 27, 2015

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Environmental Policy.  The Obama administration announced a new major clean water regulation today that will restore the federal government’s authority to limit pollution across the country.  The rule — which was issued under the Clean Water Act of 1972 — clarifies the government’s command over about 60 percent of the nation’s waters including smaller bodies of water such as streams, headwaters, and wetlands.  NY Times

Energy Policy.  In a recently released analysis of the EPA’s proposed Clean Power Plan rule, the EIA finds that the regulation would result in major changes in the fuel mix used to produce electricity in the United States.  Specifically, the analysis finds that the Clean Power Plan would increase natural gas-fired generation to displace and ultimately surpass coal-fired generation, and that wind, solar, and other renewable generation would also eventually surpass coal-fired generation.  EIA

Energy Outlook.  According to a report released today by GTM Research and Energy Storage Association, the U.S. installed 5.8 megawatts of energy storage systems during the first quarter of this year — up 16% from the same period a year ago.  Most of these systems were installed by businesses looking to evade the hefty “demand charge” levied by utilities companies to ensure that they have enough power generation capacity on hand to meet demand — which can amount to as much as 50% of a business’s monthly bill.  Forbes

Energy Policy.  In a review of state environmental agencies’ comments on the Clean Power Plan, Brookings scholars Philip Wallach and Curtlyn Kramer find that substantive concerns remain across party lines regarding the rule’s overall fairness, grid reliability, and feasibility.  Wallach and Kramer explain that these environmental agencies are critical to the rule’s ultimate success, and that their concerns “signal” important legal and political difficulties ahead of the finalized regulation.  Brookings