Energy and Environment News

Energy and Environment News

November 26, 2014

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EPA.  The EPA proposed lowering ground-level ozone standards to between the range of 65 and 70 parts per billion next year, and will seek comment on a potential range of 60 to 75 parts per billion. As part of its mandate under the Clean Air Act, the EPA must legally update ozone limits considering only science — though several groups have estimated that the lowered standards could be “the most expensive regulation ever imposed on the American public”.  WSJ

Oil.  As OPEC prepares to meet tomorrow to discuss cutting its production of oil, Iran announced that it has no plans to cut its own production and in fact plans to boost it.  Iran currently exports 1.5 million barrels of oil per day and could boost this number by 1 million barrels per day if sanctions by the U.S. and its allies are lifted.  WSJ

Energy Outlook.  Reuters reports that China is likely holding twice the amount of crude oil in strategic reserves than indicated in its official plan — nearly 30 days of current imports.  The nation is taking advantage of low oil prices as part of a long-term stockpiling strategy, and is developing storage capacity to cover as much as 90 days of oil reserves within the next few years.  Reuters

Oil.  Michael Levi of the Financial Times writes that recent global oil market volatility creates unique policy opportunities such as subsidy reform and eased relations between Ukraine and Russia.  Levi argues that policymakers must take care not to pare back support for energy efficiency and alternative fuels investments however, as global prices will not remain low indefinitely.  FT

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