May 03, 2017
Good morning. Welcome back! It has been a while since I mentioned that Axios had a bunch of cool, informative and breezy newsletters on tech, finance, health care and more. You can sign up here. One other thing: Big thanks to Amy Harder and several other Axios colleagues for their contributions to today's newsletter. Ok let's dive in . . .
The campaign for Paris
We're watching an important dynamic in light of reports last night, including ours, that White House momentum is shifting toward an exit from the Paris climate pact — the prospect of a NAFTA redux.
What we're hearing: Sources tell Axios that advocates for the U.S. staying in the Paris deal are upping their efforts to have heads of state directly weigh in with President Donald Trump in favor of remaining, similar to how the leaders of Mexico and Canada reportedly called Trump and persuaded him to renegotiate instead of terminate NAFTA.
- "One of the things we're doing as the green group contingency is to talk to other countries to make sure to tell them that now is the time to make your voice heard," an environmentalist said.
What they hope: To shift the momentum back towards staying in the Paris pact.
- "It's not over until it's over when it comes to Trump," a longtime global climate diplomacy insider told Axios.
Exclusive from Amy’s notebook: Data shows coal decline
Coal mining jobs dropped almost 8% in the first quarter of 2017 compared with the same period last year, according to Labor Department data obtained by Axios.
Reality check: The coal industry in the U.S. is not going to have a big and lasting comeback. Any upward tick will be peripheral and temporary, and mostly driven by market trends like natural gas prices and coal demand in China, not Trump's rhetoric and his efforts to repeal Obama-era environmental rules.
What they're saying:
"I have no illusion we'll suddenly go back to the production we were at five years ago," Colin Marshall, CEO of Cloud Peak Energy, one of the biggest coal producers in the U.S., said in a recent interview with Axios.
The race to save ARPA-E
In private Capitol Hill meetings and public advocacy, cleantech companies and universities are lobbying to preserve an Energy Department program that funds research into cutting-edge technologies.
Driving the news: A fight between the White House and Congress over the fate of the Advanced Research Projects Agency-Energy, a program with bipartisan backing that Trump's fiscal year 2018 budget plan would zero out.
- Round one: The new federal spending deal that runs through September is a win for ARPA-E backers, providing $306 million, which is actually a slight boost over current funding. But the battle for 2018 money remains.
Going public: A letter out today from over 100 companies, universities and groups to top congressional appropriators to provide at least $325 million, arguing the program provides a "tremendous competitive advantage to our nation."
Behind the scenes: Energy company leaders, researchers and university officials have been meeting with their delegations urging support.
- CEOs with the American Energy Innovation Council, a coalition of big companies and advocates including Bill Gates, have privately urged key appropriators that ARPA-E and related programs are "critical to U.S. long-term energy technology competitiveness and U.S. economic growth," a source with the group said. More meetings are expected as the FY 2018 fight heats up in coming months.
Even more ARPA-E
There's a lot of angst and confusion over what exactly is going on. According to multiple press accounts and your host's own reporting, funding for some projects approved under existing appropriations has been halted by Trump's Energy Department personnel.
High-level attention: It's something that's on the radar screen of GOP Sen. Lisa Murkowski, who heads the Energy and Natural Resources Committee and is also a senior member of the Appropriations Committee.
What they're saying: Murkowski said yesterday that she's been in touch with staff about the fate of the projects. The upshot of what she said is that the projects are not scuttled.
- "It means that until they get this release on the authorization to send the monies out, that they are just on hold. It is my understanding that we have not lost those projects, but there is kind of a process issue that we are dealing with right now," she said.
Climate change and Saudi Aramco’s IPO
Not the usual fare on the mother of all IPOs: An essay in The Economist Intelligence Unit makes the case that Saudi Aramco's massive initial public offering next year has a climate change "upside."
The take: Ben Caldecott, director of the Sustainable Finance Programme at the University of Oxford, says:
- Cash raised can help Saudi Arabia, the world's 10th-largest GHG emitter, invest in renewables to help move its "inefficient and heavily polluting economy" off of oil.
- Aramco's reserves are low-carbon intensity compared to some of the hard to reach, expensive holdings of international oil companies (IOCs) like BP and Shell. Investors can cut exposure to IOCs by shifting to Aramco. This should have a double impact: It will make it harder for IOCs to raise money for costly and environmentally harmful projects, and it should "jolt" the IOCs to diversify away from fossil fuels.
- If Aramco is listed on an exchange with high standards, like the London Stock Exchange, it will pressure the company and the kingdom for more transparency and accountability — it might even push Aramco into implementing climate risk disclosure recommendations.
IPO details: Reuters has the latest on the planned Aramco IPO.
Utilities: Power giant Southern Company reported $658 million profit in the first quarter of 2017 on Wednesday.
Solar: The Wall Street Journal reports that the Securities and Exchange Commission is probing whether solar energy companies are "masking how many customers they're losing."
Regulations: Bloomberg reports that a congressional vote to kill one of Obama's climate regulations could hinge on an unrelated ethanol dispute.
Tesla: Axios' Steve LeVine has a smart look at the difficulties confronting Elon Musk's vision of underground tunnels, which would carry self-driving cars, to ease traffic.
sets the stage
for the company's first-quarter earnings call this evening.
One fun thing
Climate activist Bill McKibben hasn't read the scientific paper recently penned about his influence in the climate debate, but he writes to Axios' Amy Harder that it makes him "feel suitably ancient to be the subject of academic inquiry..."
For the record: The paper's title is "Bill McKibben's Effect on the US Climate Change Debate: Shifting the Institutional Environment Through Radical Flank Effects."
Thanks for reading! Oh, and a little going away present: my Axios colleague Stef W. Kight has a handy guide to the blowback over New York Times' columnist Bret Stephens' piece on climate change. Your confidential tips and feedback are welcome at [email protected] See you tomorrow.