Oct 18, 2019

Axios Generate

Happy Friday! Today's Smart Brevity count: 1,085 words, ~ 4 minutes.

Situational awareness: “Axios on HBO” returns this Sunday! Tune in at 6pm ET/PT on HBO. On this week's show...

  • Sen. Lindsey Graham and Sen. Mitt Romney talk impeachment.
  • Economists behind Sen. Elizabeth Warren's "ultra-millionaire tax" give us an inside look into the plan.
  • We dive into the future of esports.

Onto music. At this moment 35 years ago, the late Prince was enjoying a 5-month reign atop the Billboard album charts with "Purple Rain," which provides today's intro tune...

1 big thing: Climate's G7 vanishing act

Illustration: Lazaro Gamio/Axios

Next year's G7 summit is shaping up to be unusual, and not only because the White House will host it at the Trump National Doral Miami resort.

Driving the news: Acting White House Chief of Staff Mick Mulvaney told reporters Thursday that "climate change will not be on the agenda" at the June meeting.

Why it matters: Climate's absence from the discussions will mark a sharp break with G7 meetings dating back a decade, according to veterans of global climate diplomacy.

And it will occur in a state that's grappling with sea-level rise and threatened by Atlantic hurricanes that global warming is making more powerful.

The big picture: The decision underscores the White House reversal of Obama-era norms and policies — something most evident in Trump's intention to withdraw the U.S. from the Paris climate agreement.

Most recently, Trump skipped the climate session at the August G7 meeting in France.

What they're saying: "The interesting question is how much other countries might push back against the U.S. for doing this," said Andrew Light, a senior climate aide in Obama's State Department, in an email exchange.

The intrigue: Light says the reaction of other countries will be especially important because he expects the administration will initiate the formal withdrawal from Paris as early as Nov. 4.

  • That's the first day, under the Paris agreement's structure, that the U.S. can begin the 1-year exit process, said Light, who is now with the nonprofit World Resources Institute.
  • "If I were advising another G7 leader, I would be worried about how their complicity with an agenda without climate might be interpreted in their home countries when public frustration with climate inaction is at an all-time high," he said.

Quick take: The decision to host the meeting at Doral already guarantees immense attention, given that throughout his presidency, Trump has faced allegations that he is using his office to enrich his own business.

Go deeper: Miami grapples with rising seas and stifling heat. But climate change won’t be on the G7 agenda at Trump’s Doral resort. (Washington Post)

2. Aramco reportedly delays IPO launch

Stop if you've heard this one before: Saudi Arabia is postponing plans to float shares in state oil giant Aramco, according to multiple reports Thursday.

Why it matters: Plans to offer a small slice of Aramco are aimed at raising buckets of money to fund the kingdom's economic diversification, but the effort has been beset by delays.

The Wall Street Journal sums it up this way...

  • "The delay is likely to again raise questions about whether Aramco and the Saudi government are serious about listing the kingdom’s prized asset and opening up the oil firm to scrutiny from global investors."

Where it stands: Per Bloomberg, officials are no longer planning an Oct. 20 launch of the IPO process that would have been followed by a listing on the kingdom's domestic exchange by late November.

  • "Now, a listing is unlikely before December or perhaps January," they report. The WSJ's sources offered the same timeline for plans to list up to 3% of the company.
  • Crown Prince Mohammed bin Salman is aiming for a $2 trillion valuation, but that's well above analysts' estimates.
3. Making sense of the Senate climate vote

Illustration: Sarah Grillo/Axios

The Senate yesterday rejected a resolution to overturn EPA's recent decision to scrap Obama-era carbon emissions regulations for power plants and replace them with more modest rules.

Driving the news: 3 Democrats — Kyrsten Sinema, Doug Jones, and Joe Manchin — joined Republicans in opposing the Democratic measure. Susan Collins was the only Republican to support the resolution in the 41-53 vote.

The big picture: This was a messaging vote to hit Trump's regulatory rollbacks and rejection of mainstream climate science — and put Republicans on record about it.

But, but, but: Defection of 3 moderate Democrats highlights why passing a big climate bill will be extremely hard even if Democrats somehow eke out a small Senate majority in the 2020 election.

Go deeper:

  • Senate votes to keep Trump's power plant rule (E&E News)
  • Senate Democrats plan to force vote on Trump's power plant emissions rule (Axios)
4. Rick Perry's unusual DOE tenure is ending

ICYMI, Energy Secretary Rick Perry has made it official: he's leaving the Trump administration by year-end.

Driving the news: Perry announced the move last night after reports of his resignation emerged earlier in the day, which President Trump himself later confirmed.

Why it matters: The former Texas governor had unusual longevity compared to many of Trump's other initial Cabinet picks.

  • He avoided the kind of controversies that plagued now-former Trump agency heads like Scott Pruitt and Ryan Zinke.
  • However, as Axios' Zachary Basu writes, Perry's now embroiled in the Ukraine scandal at the heart of the House's impeachment inquiry.

The intrigue: There's been a split-screen effect with Perry, which I wrote about when his plans first started leaking out 2 weeks ago.

  • He's been a vocal advocate for U.S. oil, gas and coal, although his efforts to create new support for coal-fired power plants at risk of closure didn't succeed.
  • But Perry also backs key DOE alternative energy programs, a delicate role because White House officials have sought steep cuts that Congress has rejected on a bipartisan basis.

One big question: Politico reports that his exit "doesn't resolve the most pressing question about his role in the Ukraine scandal — whether he will cooperate with House Democrats' impeachment probe."

The big picture: Per Axios' Amy Harder, DOE's posture is unlikely to change much.

Deputy Secretary Dan Brouillette will likely be acting secretary for the time being. Brouillette supports the same basic agenda, including nuclear power and LNG exports.

Go deeper: Perry's resignation letter and message to DOE employees are here.

5. Biz and market news: Pipelines, solar, OPEC

Solar: Via Greentech Media, "Leyline Renewable Capital has raised $150 million from private equity firm Newlight Partners to finance early-stage solar projects and anaerobic digesters backed by other developers."

Oil markets: Bloomberg reports that OPEC and allied producers (notably Russia) may agree in December to trim production further than their current pact that curbs output by 1.2 million barrels per day.

  • Why it matters: "If extra cutbacks are announced, it would mark a break with tradition for the cartel, which typically waits for a glut to emerge before responding," it reports.

Pipelines: Per Reuters, "DTE Energy’s midstream business said on Friday it would buy a natural gas gathering system and pipeline in Louisiana’s Haynesville shale for $2.25 billion in cash."

They're buying the assets from Momentum Midstream and Indigo Natural Resources.

6. Following up on carbon tax lobbying

The pro-carbon tax group Americans for Carbon Dividends is expanding its lobbying activities more than I initially thought.

Driving the news: A newly available filing shows the group has retained Six-7 Strategies LLC to lobby for its proposal for a tax that starts at $40-per-ton and returns revenues to the public.

It's the firm headed by Kevin Sweeney, a former aide to GOP Sen. Lisa Murkowski of Alaska.

Flashback: Yesterday we reported that Americans for Carbon Dividends also recently registered to lobby on its own behalf.

And the big K Street firm Squire Patton Boggs began lobbying for them last year.