Energy Brief: Zinke Plans to Cut Interior Workforce by 4,000

Washington Brief

  • Interior Secretary Ryan Zinke testified before Senate about his plans to cut 4,000 employees (about 8 percent of his department’s workforce) through attrition, buyouts and reassignments. (The Washington Post)
  • Zinke accused Senate Democrats of delaying the confirmation of his department’s nominees. (The Hill)
  • Democrats renewed their calls for a national bank to specifically fund renewable investments on a local level. Legislation will be reintroduced today in an attempt to support the local and state decisions stand by the Paris climate accord. (The Hartford Courant)

Business Brief

  • Lower energy costs from wind and solar power prompted more private U.S. companies, such as General Motors Co. and Wal-Mart Stores Inc., to sign green power contracts and meet their renewable energy goals. (Reuters)
  • Coal giant, India Coal, announced it will stop building coal plants after 2022 and will begin decommissioning plants next year. (The Independent)
  • Mississippi regulators asked Southern Co. to negotiate a deal for their clean coal Kemper plant to run on natural gas instead, due to uncertainties in carbon capture technology. (Bloomberg News)

Chart Review

Events Calendar (All Times Local)

Thursday
Senate Agriculture Committee hearing on Commodity Futures Trading Commission nominee 9:30 a.m.
House Natural Resources Committee hearing on Interior’s budget 9:30 a.m.
House Transportation and Infrastructure subcommittee hearing on rail infrastructure 10 a.m.
Senate Commerce subcommittee hearing on marine debris 10 a.m.
Senate Energy and Natural Resources Committee hearing on Energy Department’s budget 10 a.m.
Statoil Energy Perspectives 2017 discussion at CSIS 1 p.m.
Friday
No events scheduled

 

General

Interior chief wants to shed 4,000 employees in department shake-up
Lisa Rein, The Washington Post

Interior Secretary Ryan Zinke told lawmakers Wednesday that he plans to shrink his department’s sprawling workforce by 4,000 employees — about 8 percent of the full-time staff — as part of budget cuts to downsize the government’s largest public lands agency. Zinke, testifying before a Senate panel on the White House’s proposed budget for the Department of the Interior for fiscal 2018, said he would rely on a combination of attrition, reassignments and buyouts to make the cuts.

Zinke hits Dems for delaying Interior nominees
Will Costello, The Hill

Interior Secretary Ryan Zinke hit back at Democrats on Wednesday during a contentious budget hearing, accusing them of “willfully” delaying the confirmation of his department’s nominees.

Senators jab Perry over energy research cuts
John Siciliano, The Washington Examiner

Senate appropriators criticized President Trump’s Energy Department budget on Wednesday for a perceived desire to unravel decades of energy and scientific research through funding cuts that would place other countries ahead of the United States. “The federal debt is not the result of Congress overspending on science and energy research each year,” said Sen. Lamar Alexander, R-Tenn., chairman of the Appropriations Committee’s energy and water panel.

Donald Trump says ‘beautiful’ solar panels would allow Mexico border wall to ‘pay for itself’
ABC News

US President Donald Trump has vowed he will eventually get funding for his proposed wall on the Mexican border, saying he is considering a barrier clad with solar panels that would “create energy and pay for itself”. Mr Trump made the comments during a raucous political rally in Iowa on Wednesday (local time), where he also defended his record, rejected a Russia investigation as a witch hunt and said he was succeeding against all odds, despite no major legislative achievements.

Obama energy secretary launches nonprofit
Timothy Cama, The Hill

The former energy secretary under President Barack Obama is launching a new nonprofit organization focused on studying advancements in the energy field. Ernest Moniz, who taught physics at the Massachusetts Institute of Technology for decades before becoming energy secretary in 2013, is heading up the Energy Futures Initiative (EFI) along with two high-level staffers from his time at the Department of Energy (DOE).

Oil and Natural Gas

Oil falls again, despite decline in U.S. crude supplies
Caroline Spiezio, The Associated Press

Oil prices fell further Wednesday, with the international benchmark for crude sliding below $45 a barrel in London. The U.S. benchmark fell below $43 a barrel in New York. The recent drop in price indicates that efforts by OPEC and 10 other oil-producing countries to cut their production to reduce a supply glut and push prices higher are falling short.

Saudi Prince’s Elevation Will Have Far- Reaching Consequences in Energy
Stanley Reed, The New York Times

As the new heir apparent to the throne of Saudi Arabia, Prince Mohammed bin Salman will play an even more influential role in world oil markets at a time when big crude-producing nations are struggling to prop up prices. Whereas the royal family had previously been content to leave the running of the oil industry to seasoned technocrats, the prince has sought to exert influence over the country’s huge energy resources.

Wednesday Is Fast Becoming Oil’s Least Favorite Day of the Week
Tracy Alloway, Bloomberg News

With investors focused on the question of oversupply in the oil market, a familiar pattern is emerging in the price of crude. On Wednesdays — when the Energy Information Administration releases its latest data for U.S. production and inventories — oil prices take a tumble. The pattern has held for the past month, with losses on a barrel of West Texas Intermediate averaging 3.2 percent, or $1.56, over the past four Wednesdays.

Oil prices slip as physical excess overpowers OPEC
Libby George, Reuters

Oil slid back toward multi-month lows on Thursday, after a brief recovery early in the session, as traders warily eyed a glut of physical supply that has persisted despite OPEC-led efforts to balance the market. Brent crude futures were down 15 cents at $44.67 a barrel at 0850 GMT, after spending much of the Asian trading day in positive territory. They fell 2.6 percent in the previous session to their lowest since November.

Utilities and Infrastructure

Trump huddles with national security staff on how to protect the electric grid
John Siciliano, Washington Examiner

President Trump met with his top national security advisers on Wednesday, along with energy industry leaders and top confidants, to discuss the cybersecurity threats facing the nation’s electric grid.

N.C. regulators call for proceeding on Duke Energy’s proposed 14.9% rate hike
John Downey, The Charlotte Business Journal

The N.C. Utilities Commission issued an order Tuesday clearing the way for it to consider Duke Energy Progress’ proposed 14.9% rate increase. The order issued Tuesday by the commission requires a full rate case proceeding and suspends the rates Duke Energy proposes to implement Jan. 1 for 270 days. That last part is a formality, but a required one, to give the commission time to take testimony, hold hearings and rule on the proposed increase.

Renewables

Murphy and Esty Want $10 Billion for ‘National Green Bank’
Russell Blair, The Hartford Courant

Based on a successful energy financing model that was first implemented in Connecticut, Rep. Elizabeth Esty and Sen. Chris Murphy are leading renewed calls for the creation of a National Green Bank. The National Green Bank would lend to state and local green banks, which leverage public funds to attract private money for energy projects. The goal of the banks is to make energy efficiency and renewable energy projects more accessible so homeowners and businesses can reduce their energy costs.

America’s hungriest wind and solar power users: big companies
Nichola Groom, Reuters

Major U.S. corporations such as Wal-Mart Stores Inc and General Motors Co have become some of America’s biggest buyers of renewable energy, driving growth in an industry seen as key to helping the United States cut carbon emissions. Last year nearly 40 percent of U.S. wind contracts were signed by corporate power users, along with university and military customers. That’s up from just 5 percent in 2013, according to the American Wind Energy Association trade group.

Renewable energy is no threat to power reliability
Robert Walton, Utility Dive

There’s been some concern that DOE’s study of the power grid may be weighted towards fossil fuels, given President Trump’s many statements about bringing back the coal industry. A report funded by the Advanced Energy Economy Institute and the American Wind Energy Association concluded the United States’ power mix is changing, largely due to cheaper natural gas, flat demand and more efficient generation.

Coal

A First-of-Its-Kind Clean Coal Plant May End Up Burning No Coal
Jim Polson, Bloomberg Government

A first-of-its-kind “clean coal” power plant that utility owner Southern Co. spent years constructing in Mississippi could end up burning no coal at all — and instead run just like any other natural-gas generator. After years of delays and billions of dollars in cost overruns, Mississippi regulators on Wednesday called on Southern to work on a deal that would have the Kemper plant fueled only by gas.

World’s biggest coal company closes 37 mines as solar power’s influence grows
Harriet Agerholm, The Independent

The largest coal mining company in the world has announced it will close 37 mines because they are no longer economically viable. Coal India, which produces around 82 per cent of India’s coal, said the mines would be decommissioned by March 2018.

Nuclear

Scrutiny intensifies over safety at Los Alamos lab
Susan Montoya Bryan, The Associated Press

The safety record at the U.S. laboratory that created the atomic bomb is facing intensifying criticism as work ramps up to produce a key component for the nation’s nuclear weapons cache. In an internal memo obtained by The Associated Press, Los Alamos officials took aim at critics and reassured employees of the safety of the lab’s facility for making plutonium cores used to trigger the explosions in nuclear bombs.

Hold ’em or fold ’em: New nuclear build permits hold ‘option value’ for five utilities
Peter Maloney, Utility Dive

Recent news about nuclear power plants would not seem to be conducive to building a new nuclear plant, but five electric companies are keeping their plans for new reactors alive. Earlier this month, the Nuclear Regulatory Commission authorized a combined construction and operating license (COL) for a third reactor at Dominion Virginia Power’s operating North Anna nuclear plant in near Mineral Spring, Va. Dominion filed with the NRC for the COL in 2007.

Sen. Alexander Urges Administration to Support Private Nuclear Waste Storage
Iulia Gheorghiu, Morning Consult

A key senator on Wednesday urged the Energy Department to support private interim facilities for the nation’s nuclear waste, amid a growing stalemate over how to store the radioactive material.

Climate

Rick Perry floats adversarial ‘red teams’ to resolve climate debate
John Siciliano, The Washington Examiner

Energy Secretary Rick Perry on Wednesday proposed using a process floated by a former Obama administration official to resolve the debate over global warming by allowing government scientists to hash out the facts through an open “adversarial” process.

Former energy chief says Rick Perry’s view on climate and CO2 ‘flies in the face of science’
Tom Benning, The Dallas Morning News

Former Energy Secretary Ernest Moniz said Wednesday that he was “disappointed” in his successor Rick Perry’s recent questioning of how much carbon dioxide emissions contribute to climate change, saying it “flies in the face of science.” Perry created a stir this week when he said in a TV interview that it’s “inappropriate” to treat those who don’t believe the science on climate change is settled as if they are Neanderthals.

How well have climate models done in the upper atmosphere?
Scott Johnson, Ars Technica

If people who reject climate science ever point to actual data, you can just about bet the farm it will be data from satellite measurements of upper-atmosphere temperatures. At least until the record-setting global heat in 2015 and 2016, some of the satellite data was amenable to the claim that global warming had magically ended in 1998. That was always nonsense, involving cherry-picking a start year and ignoring ongoing corrections to the complex satellite measurements. That said, it is certainly fair to compare the satellite records to climate models to see what we can learn.

Climate change could lower the quality of your coffee
Nancy Coleman, CNN

Cooler temperatures allow the coffee to ripen more slowly — and that means more time to develop more complex flavor elements like acidity and sweetness. But when temperatures rise, as they have slowly been doing in Ethiopia for years, the warmth causes the coffee to ripen too quickly, which means less flavorful beans. A shift in quality is the main difference consumers will see.

Opinions, Editorials and Perspectives

Pipeline Fighters Take a Stand in Virginia Vote
David Turnbull, Morning Consult

Much has been written about last week’s Democratic gubernatorial primary in Virginia, where former Rep. Tom Perriello challenged establishment candidate Ralph Northam in a late charge. The race was billed as “establishment” vs. the “Bernie wing” of the party, but there’s another story to be told in Virginia: that of the pipeline fighters and the critical votes they could provide in November’s hotly contested general election.

Does Coal Stand a Chance Against Renewable Energy?
Frank Holmes, Forbes

You might have heard the news that the first new coal mine in a decade opened this month in a small Pennsylvania town called Friedens. The Acosta Mine—the output from which will be used in the production of steel—is expected to employ between 70 and 100 people over 15 years, with salaries ranging between $50,000 and $100,000. President Donald Trump, a strong supporter of coal and fossil fuels in general, even appeared live on video during the grand opening, saying it “signals a new chapter in America’s long, proud coal mining tradition.”

Pa. should just say no to a tax on gas drillers
David Spigelmyer, PennLive

After a challenging 2016, we’re beginning to see signs of a fragile energy market recovery. With efforts at the federal level to reform taxes and reduce bureaucratic red tape, states are engaged in a fierce competition for capital and job-creating investment resources.

Coal mining operation has a future
Bill White, The Morning Call

I went from darkness to sunlight, primitive to modern, past to future last Friday. The Lehigh Anthracite site still includes the entrance to the old No. 8 mine, whose coal these modern-day miners are reclaiming in the sunlight instead of the darkness.

Research Reports

Resilience potential of the Ethiopian coffee sector under climate change
Justin Moat et al., Nature Plants

Using a modelling approach in combination with remote sensing, supported by rigorous ground-truthing, we project changes in suitability for coffee farming under various climate change scenarios, specifically by assessing the exposure of coffee farming to future climatic shifts. We show that 39–59% of the current growing area could experience climatic changes that are large enough to render them unsuitable for coffee farming, in the absence of significant interventions or major influencing factors.

The Breakdown of the Merchant Generation Business Model
Raymond Gifford et al., Wilkinson Barker Knauer LLP and the Power Research Group

Over 40% of U.S. power demand is supplied by merchant generators rather than regulated utilities. During the advent of electricity restructuring in the 1990s, private generators funded by private risk capital were going to be the future of electric generation in the U.S. It has not turned out that way. To the contrary, some large merchants may be headed toward a second round of bankruptcies in less than twenty years.