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Illustration: Rebecca Zisser / Axios

Washington isn't even close to a coherent strategy on energy and climate change, and that puts these issues all over the map, literally. Here's what I'm watching this year and why.

1. Gritty details of Trump's deregulatory efforts

If 2017 was mostly talk, then 2018 is necessarily going to be mostly action. This is a common theme on a host of issues in Washington, but none is more pronounced than in the deregulatory slog President Trump has promised.

At the top of this long list are the Environmental Protection Agency's plans to eventually replace former President Obama's power-plant carbon regulations, as well as one setting standards for emissions of methane, another greenhouse gas, from new oil and gas wells. The Interior Department is also working to replace Obama's offshore drilling leases with more sweeping plans, including just-allowed leasing in the Arctic National Wildlife Refuge.

2. Rubber meets the road on trade battles

Whether you install solar power or move oil around, you're probably nervous about Trump's trade agenda. 2017 was the year of articulating promises — or threats — and this year will be the first chance to put those to the test.

The White House faces a Jan. 26 deadline to decide whether to issue tariffs or another remedy against cheap solar imports, coming mostly from China or Chinese-owned companies. Other trade cases, such as ones involving imported steel used in pipelines and other infrastructure, are pending too.

Energy companies are also watching to see to what extent the administration looks to revise — or withdraw from — the North American Free Trade Agreement, whose negotiations have dragged into at least the first quarter of this year.

3. Electricity market mayhem gets real

The Federal Energy Regulatory Commission faces a Jan. 10 deadline to respond to the Energy Department's request to propose a rule that would compensate nuclear and coal plants for their ability to store electricity fuel on site for 90 days. (Most other electricity sources can't do that). It's wonky as all get-out, but the fight over America's stagnant electricity market is a fight that affects almost all parts of the energy sector.

On top of this unfolding debate, expect to see more companies announce shutdowns of coal and nuclear power plants, due to increasingly tough competition from cheap natural gas and renewables.

4. The roads from Paris and Kigali

The Paris climate deal and Kigali amendment to the Montreal Protocol, both Obama-era climate policies, represent two widely different Trump administration approaches to global climate negotiations. Trump has vowed to withdraw from the Paris accord unless he can get a better deal, while his administration has signaled tacit support for the Kigali amendment. This year will likely move from words to action.

  • Negotiators will meet in December in Poland for a key annual meeting laying the groundwork for the next stage of the Paris climate deal. This will offer the most concrete chance for the Trump administration to show whether it genuinely wants a better deal to stay in the Paris accord. So far the evidence is that it actually does not.
  • The Kigali amendment was signed in October 2016 in Kigali, Rwanda, as part of the Montreal Protocol, a treaty protecting the Earth's ozone layer. It's about reducing hydrofluorocarbons (HFCs), which are potent greenhouse gases used in appliances like air conditioners and fridges. The administration needs to send the amendment to the Senate for a ratification vote within this next year to ensure timely U.S. participation in the policy.
5. Carbon tax battles heat up

It is a perennial favorite issue of academics and economists to tout despite almost zero publicly stated interest in Congress or the White House. But this year might actually see some tectonic plates shift around a carbon tax. As I wrote in December, experts for and against a carbon tax — and those that are agnostic about it — are going to be ramping up their work on this front.

6. Hunger Games of transportation

In October, I wrote about the Hunger Games of electricity: different fuels battling it out for a piece of the finite electricity market. I'm starting to see on the horizon a similar battle brewing in the transportation mix.

Demand for transportation fuel isn't growing much in the U.S., yet choices are increasing. Electric cars get a lot of hype. This year will help show to what degree this hype — pronouncements made by China and car companies for example — are more than just rhetoric.

The Trump administration also seems serious about urging Congress to overhaul the federal ethanol mandate, which requires refineries to blend increasing amounts of biofuels (mostly from corn) into the nation's gasoline supply.

7. Oil prices hovering upward

This is a bit of a catch-all for the myriad of issues stemming from oil prices' every move. Oil prices are projected to be hovering higher this year than in previous years. One big question is whether oil companies will boost their investments and ward off a supply crunch — and subsequently much higher prices — in a few years, as the International Energy Agency has been warning for at least a year.

2018 could also see pivotal changes in, or dissolution of, the relationship between OPEC and other oil-producing countries, notably Russia. The relationship was established to address the global oil glut that began a few years ago and appears to be dissolving.

8. Saudi Aramco IPO

It would be the world's biggest initial public offering ever. It's probably already the most-talked about, even if it never happens. Saudi Aramco, the state-owned oil giant in Saudi Arabia that is the biggest oil-producing company in the world, has said it's sticking with its plans to sell up to 5% of its shares this year.

What exchange it'll list the shares on — New York, London or elsewhere — remains a mystery. Let's also not forget that the whole purpose of the IPO is to diversify Saudi Arabia's oil-dependent economy away from being too dependent upon oil. That's emblematic of a larger trend among the world's biggest oil companies that I also expect will accelerate in 2018.

Go deeper

43 mins ago - Health

Treasury begins dispersing $350 billion in COVID relief funding to states and localities

Treasury Secretary Janet Yellen. Photo: Tasos Katopodis/UPI/Bloomberg via Getty Images

The U.S. Treasury on Monday began giving state and local governments access to $350 billion in emergency funding from the American Rescue Plan, the department announced Monday.

Why it matters: Though the money is aimed at helping state, local, territorial and tribal governments recover from the pandemic's economic fallout, the administration will generally give them wide latitude on how they can use the funds.

Game developers break silence around salaries

Illustration: Annelise Capossela/Axios

Developers are sharing their salaries on Twitter under the hashtag #GameDevPaidMe to encourage pay transparency in their industry.

The big picture: The hashtag started circulating last year, but has returned periodically as developers fight for better working conditions. Salary sharing is a way to equalize the field. By removing the secrecy, as well as the stigma, around discussing pay, workers have more power to advocate for themselves when negotiating salaries and raises.

1 hour ago - World

Jerusalem crisis: Hamas fires rockets, Israel begins military campaign

Palestinian protesters and an Israeli police officer near the Damascus Gate. Photo: Amir Levy/Getty Images

Days of tension in Jerusalem escalated into an exchange of fire on Monday, as Hamas fired dozens of rockets toward Israel and the Israeli military responded with strikes of its own and said it was preparing for a military operation that could last several days.

Why it matters: This is the first time Hamas has fired rockets at Jerusalem since 2014, and it's the most serious escalation between the Israelis and Palestinians in many months. It comes during the most sensitive days on the calendar — the last days of Ramadan and the Jerusalem Day commemoration on Monday — and as political crises roil both the Israeli and Palestinian governments.