Energy Brief: Renewables Don’t Threaten Grid Security, Draft Report Says


Government Brief

  • A draft of the U.S. power grid report ordered by Energy Secretary Rick Perry noted that solar and wind energy don’t threaten national energy reliability. (Bloomberg)
  • The United Mine Workers of America and boiler and utility unions presented a legal basis for replacing the Obama administration’s Clean Power Plan to the Office of Management and Budget. The proposal is not public while under review, but a Trump Clean Power Plan would likely support coal-fired power plants. (Washington Examiner)
  • The Department of Homeland Security cybersecurity division did not identify public safety risks to the hacking targeting energy, nuclear and manufacturing firms recently, but agency specialists said more analysis needs to be done. (E&E News)

Business Brief

  • Duke Energy Corp.’s Kentucky subsidiary announced the construction of three solar plants in the state known for its coal industry. The Kentucky Public Service Commission said the projects, anticipated online in early 2018, will cost $14.8 million. (The Charlotte Business Journal)
  • A $2-billion private-equity energy fund managed by EnerVest Ltd. borrowed more than $1 billion to buy oil and natural gas wells before the price of oil plummeted and cannot satisfy its debts. The fund’s lenders, including Wells Fargo & Co., began negotiating to take control of its assets. (The Wall Street Journal)
  • Oil prices reached $49 a barrel after the United States slowed down the installation of new rigs, adding fewer rigs over the past four weeks than any period since last November. U.S. crude oil inventories last week showed the largest drop in 10 months. (Reuters)

Chart Review

Events Calendar (All Times Local)

Monday
No scheduled events
Tuesday
House Natural Resources oversight subcommittee hearing on federal natural resources 10 a.m.
House Energy and Commerce subcommittee hearing on market participation in the electric industry 10 a.m.
Senate Energy and Natural Resources Committee hearing on energy and resource security 10:30 a.m.
Resources for the Future webinar: Future of California’s Cap-and-Trade Program 12 p.m.
House Natural Resources oversight subcommittee hearing on onshore oil and gas development in Alaska 2 p.m.
Wednesday
Senate Energy and Natural Resources national parks subcommittee legislative hearing 10 a.m.
Center for Strategic and International Studies discussion on the Renewable Fuel Standard 10 a.m.
House Natural Resources Committee legislative hearing 10 a.m.
Senate Environment and Public Works subcommittee hearing 10 a.m.
House Natural Resources oversight subcommittee hearing on the Magnuson-Stevens Act 2 p.m.
Thursday
House Natural Resources oversight subcommittee hearing on the future of hardrock mining 9 a.m.
Senate Energy and Natural Resources Committee nomination hearing for Interior and Energy Department nominees 10 a.m.
Senate Environment and Public Works subcommittee hearing on water infrastructure 10 a.m.
Friday
No scheduled events

General

Trump Names Energy Lawyer McIntyre as FERC Chair
Michael Brooks, RTO Insider

The co-leader of Jones Day’s energy practice in D.C., Kevin McIntyre has represented energy companies in litigation, compliance and enforcement matters and corporate transactions. McIntyre, who has been rumored for months as Trump’s choice for the chair, would join more than a dozen other Jones Day alumni in the administration, including White House Counsel Don McGahn, a former Jones Day partner. Trump’s campaign reportedly has paid the firm $3.3 million in legal fees since 2015.

Rick Perry: We aim for energy domination
Salena Zito, Washington Examiner

A day after Secretary of Energy Rick Perry toured a coal-fired power plant in northern West Virginia, the former Texas governor sat down with the Washington Examiner at the National Energy Technology Laboratory in suburban Pittsburgh. He praised work the lab is also doing to identify and extract rare-earth elements from coal and coal byproducts.

Oil edges above $49 on U.S. drilling slowdown
Alex Lawler, Reuters

Oil rose above $49 a barrel on Monday as a slowdown in the growth of rigs drilling in the United States eased concern that surging shale supplies will undermine OPEC-led cuts. U.S. drillers added two oil rigs in the week to July 14, bringing the total to 765, Baker Hughes said on Friday. Rig additions over the past four weeks averaged five, the lowest since November.

Oil and Natural Gas

From $2 Billion to Zero: A Private-Equity Fund Goes Bust in the Oil Patch
Ryan Dezember, The Wall Street Journal

A $2 billion private-equity fund that borrowed heavily to buy oil and gas wells before energy prices plunged is now worth essentially nothing, an unusual debacle that is wiping out investments by major pensions, endowments and charitable foundations. EnerVest Ltd., a Houston private-equity firm that focuses on energy investments, manages the fund.

U.S. Seeks One57 Condo Cash in Nigerian Oil Corruption Case
Tom Schoenberg and Oshrat Carmiel, Bloomberg

The U.S. is seeking to recover $144 million in assets, including proceeds from a luxury condominium on Manhattan’s Billionaires’ Row in New York, which prosecutors claim were spoils from bribes paid for Nigerian oil contracts. The Justice Department, in a lawsuit filed Friday in Houston, said two Nigerian businessmen made corrupt payments to a Nigerian official who oversaw the country’s state-owned oil company in exchange for contracts. They then laundered the money through the U.S., according to the filing.

Alaska Legislature passes last-minute oil tax deal, but capital budget is still pending
Nathaniel Herz, Alaska Dispatch News

The Alaska Legislature passed a late-night deal Saturday to end cash payments to oil companies, beating a midnight deadline to end its special session with an hour to spare. There was also no agreement on what would come next for lawmakers, who have been meeting continuously since January and have struggled to reach agreements on legislation to reduce the state’s $2.5 billion deficit, as well as on Alaska’s annual spending plans.

Oil Skeptics Let a Little Sunshine In
Jessica Summers, Bloomberg

After the worst June for oil in six years, hedge-fund bets on declining West Texas Intermediate retreated. That made room for futures to rebound more than 5 percent last week on optimism that the summer will finally boost demand for crude and gasoline.

Utilities and Infrastructure

Chao talks Trump infrastructure plan in Louisville speech
Marcus Green, WDRB

U.S. Transportation Secretary Elaine Chao said Friday that “nothing is off the table” as President Trump’s administration assembles a 10-year infrastructure plan, including the possibility of a federal gasoline tax increase. Trump has previously said he is open to raising the tax, which has been set at 18.4 cents per gallon for unleaded fuel since 1993, to help fund his initiative.

Renewables

Renewable Energy Not a Threat to Grid, Draft of U.S. Study Finds
Catherine Traywick et al., Bloomberg

Wind and solar power don’t pose a significant threat to the reliability of the U.S. power grid, Energy Department staff members said in a draft report, contradicting statements by their leader Rick Perry. The findings — which are still under review by the department’s leadership — contrast with Perry’s arguments that “baseload” sources such as coal and nuclear power that provide constant power are jeopardized by Obama-era incentives for renewable energy, making the grid unreliable.

Duke Energy will build three utility-owned solar projects in Kentucky
John Downey, The Charlotte Business Journal

Duke Energy will build three utility-owned and operated solar projects in Kentucky. Construction will start by the end of the summer, and the projects are likely to be online by early 2018, Duke says. This will be the fourth state in which a Duke regulated utility owns solar farms.

A $5.25 Million Self-Powered Hydrogen Boat Has Set Off on a 6-Year Trip Around the World
Aric Jenkins, Fortune

A multi-million-dollar boat that powers itself without any fuel has set off to begin a 6-year trip around the world in hopes of launching a movement of emissions-free travel. The Energy Observer, a former racing boat converted by a team of nearly 50 engineers, designers and naval architects, will use a combination of a hydrogen fuel cell system, solar panels and wind turbines to sail throughout its voyage spanning 50 countries and 101 stopovers.

Coal

EPA mulls unions’ ideas for a Trump ‘clean coal’ power plan
John Siciliano, Washington Examiner

The meeting was part of a series of meetings OMB is holding to review an EPA proposed rule on the Clean Power Plan that many believe will result in a replacement rule, rather than a repeal. But the proposal won’t be made public until after the review period concludes.

China June coal output rises as summer power demand heats up
Muyu Xu, Reuters

China’s coal production rose 10.6 percent to 308 million tonnes in June from a year ago, data showed on Monday, as miners ramped up output to meet a pick-up in demand during the hot summer months, data from the National Statistics Bureau showed. Authorities have called for coal miners to boost output to ensure power supplies as people crank up air conditioners with a prolonged heatwave hitting across the country.

Rising from the ashes, a Buffalo suburb ends its dependence on coal
Elizabeth McGowan, Salon

Sixteen months ago, the coal-fired Huntley Generating Station, which sits on the banks of the Niagara River, stopped producing power for first time since World War I. Erie County lost its largest air and water polluter. But the town of Tonawanda, a working class Buffalo suburb 13 miles downstream of America’s most storied waterfalls, also lost its biggest taxpayer.

Nuclear

DHS sorts through ‘mountain’ of data on energy cyberthreat
Blake Sobczak, E&E News

Department of Homeland Security specialists are in the “early” stages of decoding a sophisticated hacking campaign targeting energy, nuclear power and manufacturing firms this year, according to an official familiar with the case.

Illinois Zero-Emission Credit Suit Dismissed
Rich Heidorn Jr., RTO Insider

A federal judge on Friday dismissed challenges to Illinois’ zero-emission credit program, saying the customers and independent power producers who filed suit lacked standing and failed to exhaust their remedies at FERC. U.S. District Court for the Northern District of Illinois Judge Manish S. Shah ruled in favor of motions by the state and Exelon to dismiss the case.

France must define possible scenarios to reduce nuclear: minister
Bate Felix and Mathieu Rosemain, Reuters

France should define a clear roadmap to fulfill its pledge to cut the share of nuclear power in its electricity generation to 50 percent by 2025, French ecology minister said in an interview in the Sunday edition of regional daily Ouest-France. A 2015 law requires France to reduce in eight years the share of atomic power generation to 50 percent from over 75 percent currently, and include more renewable wind and solar generation.

Climate

Where Else Does the U.S. Have an Infrastructure Problem? Antarctica
Justing Gillis and Jonathan Corum, The New York Times

The United States has had the most ambitious research program in Antarctica for 50 years. But its infrastructure is old, and the new price tags are high.

Calif. lawmakers to decide fate of landmark climate law
Jonathan J. Cooper, The Associated Press

California lawmakers are nearing a high-stakes decision that will decide the fate of a climate initiative that Gov. Jerry Brown holds up as a model to be replicated around the world to confront rising global temperatures. The vote Monday on whether to give another decade of life to California’s cap-and-trade program has global implications as the largest U.S. state moves to be a leader in reducing carbon emissions at a time when President Donald Trump is pulling back from fighting global warming.

A new documentary seeks to make coral reefs the ‘poster image of climate change’
Chelsea Harvey, The Washington Post

For years now, the melting ice sheets of Greenland and Antarctica have been the poster children for climate change, iconic harbingers of a warming world. A new documentary, “Chasing Coral,” released Friday on Netflix, aims to bring the same attention to the plight of the world’s coral reefs.

Trump regrets ‘bizarre mistake’ of Paris climate pullout, Branson claims
Oliver Milman, The Guardian

Donald Trump regrets the “bizarre mistake” of withdrawing the US from the Paris climate agreement, Sir Richard Branson has said. The British billionaire also urged the president to help phase out the ailing US coal industry.

Opinions, Editorials and Perspectives

DOE Study Seeks Answers to Important Energy Questions
Grant Kidwell, Morning Consult

Imagine running a business where the state government mandates that your competitors automatically get a third of the market. On top of that, the federal government provides your competitors with generous tax credits. Even more frustrating, your product is more reliable.

Should Advanced Coal Projects Be Part Of The Green Climate Fund?
Ken Silverstein, Forbes

At issue now is the so-called Green Climate Fund established by the United Nations that exist to distribute monies to developing countries to help them fight climate change. The U.S. has given $1 billion of the $3 billion it has pledged, all while President Obama was in office. Trump is reneging on that promise, although he is now saying that he could revisit the issue if monies would be targeted to advanced coal projects — causes that he says would serve to electrify many parts of the world in the fastest and most cost effective manner.

U.S. is falling behind on nuclear power
Mike Wallace, The Baltimore Sun

Despite successful energy efficiency efforts, our increasingly “wired” economy is projected to grow U.S. electricity demand 22 percent by 2040. At that rate, we need to build 20-25 new nuclear reactors just to keep U.S. nuclear power where it is today.

Research Reports

Creating a More Perennial Problem? Mountaintop Removal Coal Mining Enhances and Sustains Saline Baseflows of Appalachian Watersheds
Fabian Nippgen et al., Environmental Science & Technology

Mountaintop removal coal mining (MTM) is a form of surface mining where ridges and mountain tops are removed with explosives to access underlying coal seams. The crushed rock material is subsequently deposited in headwater valley fills (VF). We examined how this added water storage potential affects streamflow using a paired watershed approach consisting of two sets of mined and unmined watersheds in West Virginia.