Jul 25, 2017

Axios Generate

By Ben Geman
Ben GemanAmy Harder

Good morning and welcome back! Thanks as always to my colleague Amy Harder for her contributions to Generate.

Don't forget, your tips and feedback are welcome at ben@axios.com. Why not listen to Mark Knopfler's excellent guitar playing while you read this? Ok, let's get to it . . .

Tesla lobbies against solar trade protections

Tesla's second-quarter lobby filing shows that the electric vehicle and solar company is lobbying against a petition by two panel makers — Suniva and SolarWorld — that are asking the Trump administration to impose steep import penalties on solar cells and modules.

  • "Although we are currently building the largest solar cell and module manufacturing plant in the US, we still oppose this petition. Tesla is committed to expanding its domestic manufacturing with or without any tariff or price guarantees," a Tesla spokesman tells Axios.

The newly revealed lobbying arrives amid wider pushback from several entities like the Energy Trade Action Coalition and Solar Energy Industries Association against the petition, which we wrote about in Generate last week.

Go deeper: Reuters just published an in-depth piece about how even the prospect of new Trump administration solar trade restrictions is affecting the sector.

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Overall, Tesla reported $170,000 in total second-quarter lobbying, compared to $190,000 the prior quarter. The Silicon Valley company reported lobbying on a range of EV and energy tax credit and other topics. The sum is relatively modest stuff by Beltway standards.

Amy’s notebook: IEA chief says coal sector dropped the ball

Coal companies were expected to invest in technology to capture and store carbon emissions over the last decade, but didn't — and that's probably hastening the sector's decline, according to the International Energy Agency chief.

"I thought fossil fuel companies, especially coal companies, would make a major push for the [carbon capture technology], just to protect their businesses [and] investment strategy, not because of climate change," IEA executive director Fatih Birol told Axios last week in Washington. "But they didn't do it." The result, he said, is that global coal consumption has declined for two years in a row.

Why it matters: Birol's comments offer a glimpse into how one of the most powerful energy organizations views the coal industry's relative standing in the global fuel mix. While fossil fuels still account for 81% of the world's energy consumption — a statistic that hasn't changed in 30 years — natural gas has eaten into much of coal's market share in the U.S. and is expected to grow globally.

On the other hand: Luke Popovich, spokesman for the National Mining Association, lays the blame at former President Obama's feet, saying the industry had a coalition prepared to fund its share of a carbon capture project called FutureGen 2.0 but federal funding was pulled due to a statutory deadline.

ICYMI:

Check out

my Harder Line column

this week for more on the latest about clean coal technologies.

Latest in oil

Up we go: Prices are ticking upward Tuesday as traders appear to have more confidence following yesterday's meeting in Russia that OPEC and allied producers can eventually make some progress in taming the global supply glut.

  • The Wall Street Journal notes that markets are responding to several meeting takeaways: OPEC officials are now contemplating a crackdown on countries that haven't stuck to the deal, Saudi Arabia has pledged to cut exports next month, and Nigeria (which is exempt from the agreement) nonetheless pledged to cap its rising output at 1.8 million barrels per day.

Oil peak soon? Goldman Sachs lays out an unlikely-but-possible peak in worldwide oil demand in less than a decade, according to Reuters. The peak could arrive as soon as 2024 "if there are more efficiency gains in vehicles, greater market penetration by electric cars, lower economic growth and higher fuel prices," Goldman said in a note, while calling this an "extreme" case.

Interior Department in focus

A few pieces of news about the department...

Brass tacks on fracking regs: Interior's Bureau of Land Management is slated to issue a proposal today that will formally withdraw Obama-era regulation of hydraulic fracturing on federal and tribal lands.

  • Why it matters (eventually): The action has no immediate practical impact because the 2015 rules have been frozen in the courts and never took effect. But following broad statements of intent to kill Obama-era regulations, the formal administrative documents require Trump officials to show in detail how they will justify regulatory rollbacks.
  • What to expect: Bank on attorneys for green groups to scour the proposal and subsequent final rule for legal vulnerabilities. Litigation is likely to follow any final action to kill the rules that cover disclosure of chemicals, water management, and construction standards for wells.

Dems want IG probe of staff moves: 8 Senate Democrats on the Energy and Natural Resources Committee are asking Interior's inspector general to investigate "troubling" reports of the "arbitrary reassignment" of dozens of career staff.

  • Their letter, available here, stems from allegations by a department scientist that he was shuffled to an unrelated job in retaliation for speaking out about the threat of climate change.
  • "The OIG received the letter this afternoon and will promptly access resources and methods that could fulfill the request. We currently do not have any related work," a spokeswoman for the IG tells Axios.
  • The Washington Post has more on the letter and Interior's response here.

Interior deputy confirmed: The Senate voted 53-43 yesterday to confirm lobbyist David Bernhardt as deputy secretary, the number two slot at the department. Vote breakdown here.

  • More help en route: The Senate ENR Committee announced that it will vote Thursday on several nominees for high-level slots at Interior and the Energy Department.
On my screen

Carbon pricing: Researchers with the think tank Resources For the Future have a new paper that explores the benefits and potential drawbacks of linking separate regional carbon pricing systems (using California and the northeast's Regional Greenhouse Gas Initiative as a test case).

  • It finds that linking separate systems can provide benefits, including more cost-effective reductions, but policymakers also must be aware of negative effects, including the prospect that some areas may see disproportionately little reduction in conventional air pollutants.
  • Why it matters: While there's little near-term hope for a unified national CO2 price, the authors see potential benefits to linking regional systems. California's recent decision to extend its cap-and-trade system through 2030 could provide new opportunities.

Climate science: A new paper concludes that humankind's available carbon "budget" — the amount of emissions that can be emitted in years ahead while still preventing the most dangerous warming levels — may be smaller than previously estimated.

  • In essence, the paper in Nature Climate Change says that while the researchers have commonly viewed "pre-industrial" as the mid-late 1800s, even the small amounts of human-influenced warming that occurred before that means there is less leeway to avoid more than two degrees celsius of temperature rise.
  • "For stabilization at 2 ◦ C, allowable emissions decrease by as much as 40% when earlier than nineteenth-century climates are considered as a baseline," the paper states.
  • The Washington Post has a detailed piece on the new paper here. A summary from Penn State, where scientist and co-author Michael Mann is a professor, is available here, and the full paper ($) is here.

Electric cars: Your Generate is a little late to this one, but three cheers for this useful chart from Bloomberg New Energy Finance that compares a slew of forecasts (including their own) of EV market penetration increases in coming years and decades.

Heat: Over at the University of California-Berkeley, Lucas Davis looks at how changes to electricity pricing in India could prevent use of the most inefficient air conditioners, which are problematic as air conditioning is expanding as the hot continent gets hotter.

One cool (but warming) thing

NASA has released new photos of Operation IceBridge, an airborne survey of a specific kind of thick Arctic sea ice that has been around for multiple years.

According to the agency, this type of ice has "dramatically thinned" and shrunk in area as the climate has warmed. NASA says it once accounted for 70% of winter Arctic sea ice, but these days it's less than 20% of total sea ice reach.

Why it matters: Nathan Kurtz, a scientist with the project, says in the short report released Monday that this thick form of ice serves an important purpose by reflecting sunshine away.

  • "But we have now lost most of this old ice and exposed the open ocean below, which absorbs most of the sun's energy. That's one reason the Arctic warming has increased nearly twice the global average — when we lose the reflecting cover of the Arctic Ocean, we lose a mechanism to cool the planet," he said.
Ben GemanAmy Harder