Good morning and welcome back! I buried two song references from the 1980s today (sorry, it's where I'm most comfortable). One is from Run-DMC, the other is a snippet from a one hit wonder who charted in the U.S. in 1983. Ok, let's get to it . . .
One of the best things I've heard this week is the interview (available here) with Russian energy expert Tatiana Mitrova, director of the SKOLKOVO Energy Centre in Moscow. A couple of key points from her 40-minute chat on the Columbia Energy Exchange...
Fling, not marriage: Don't look for Russia's work with OPEC to limit output as a long-term relationship between the large producers. It may not even extend past the expiration of the current agreement that runs through March of next year.
Sanctions: They have little effect on current crude production capacity. Instead the big question is whether U.S. sanctions will ultimately affect future output, which depends on whether Russia can develop tech on its own to replace the know-how of western firms needed to tap unconventional and offshore resources.
Nord Stream 2: Gazprom's controversial gas pipeline that goes to Germany is likely to be built, she added, despite U.S. opposition and the complex European politics of the project that would bypass Ukraine and other key states.
Speaking of Nord Stream 2: The Russian sanctions law that President Trump signed August 2 creates the option to impose sanctions against the project, and as Generate readers know, the Gazprom subsidiary working with several European energy companies to build Nord Stream has hired U.S. lobbying firms.
Plus, as Politico noted yesterday, the pro-pipeline European gas companies have also brought on a U.S. lobbying firm (McLarty Inbound).
My thought bubble: Maybe they should all just save their money. "Despite the Administration's stated opposition to Nord Stream 2, it has demonstrated little interest in taking a tougher line on Russian energy projects, even with the authority it already has to do so," Jason Bordoff, who heads Columbia's Center on Global Energy Policy, tells Axios in an email.
My Axios colleague Amy Harder passed along these observations about the current messaging about coal...
The National Mining Association, which represents coal miners, wrote a blog post Wednesday declaring: "Neither the dead nor the living read their obituaries. Coal isn't reading them because it isn't dead." That's being bolstered by a Wall Street Journal lead editorial: "Coal makes a comeback."
Let's contrast that with a story in the trade publication SNL (subscription required) that quotes several traditionally coal-based utility executives touting their transition away from coal.
My thought bubble: The talking points by industry in Washington often differ and are rosier than those made during earnings calls. I take what I hear on an earnings call over what I hear in Washington any day.
Bottom line: By repealing his predecessor's regulations, Trump is helping give a small boost to an industry that is never going to be back at its previous level. The increase in exports cited in both the blog post and the WSJ editorial are not due to Trump's actions, by the way. Flashback: Axios reported that this was going to happen back in April, when we quoted a coal mining CEO who said the expected rise was due to increased demand from Asia.
It begins: As NAFTA renegotiation gets underway, much of the U.S. energy industry is taking a "do no harm" stance toward the agreement that they're basically happy with already.
Yes, but: A new paper from the think tank Resources for the Future finds that the NAFTA talks are a chance to solidify the North American energy and environmental relationship.
It also uses the talks as a jumping off point to look at the North American energy relationship more broadly. Among the areas ripe for more cooperation...
Go deeper: The Center for Strategic and International Studies podcast has a new episode about the stakes for NAFTA renegotiation. Listen here.
Something to watch: Canadian Foreign Affairs minister Chrystia Freeland, heading into the talks that began this week, said one key Canadian goal is strengthening environmental provisions in NAFTA, and wants an agreement that "fully supports efforts to address climate change." Maclean's posted her broader remarks this week ahead of the talks here.
Not too late: A newly released Rocky Mountain Institute study makes the case that limiting the global temperature rise below 2 degrees Celsius is still within reach.
It's tricky: An interesting new analysis from Carbon Brief seeks to specifically quantify the factors behind the 14% drop in U.S. carbon emissions since 2005. It turns out there are lots of reasons, even though the coal-to-gas transition in the power sector gets so much attention.
Gulf of Mexico: Yesterday's Interior Department lease sale for tracts in the Gulf of Mexico drew $121 million in winning bids, with the largest total spending from Chevron, Shell, Exxon, and Total (in that order). Data here.
While the numbers weren't huge, the sale shows continuing interest in the region by a number of companies.
OPEC: Bloomberg issued a QuickTake today with a helpful and brief primer on the cartel, including its history, recent weakened market influence, and renewed efforts to regain leverage. "[T]he group's inability to sustain higher prices in 2017 advances the view that OPEC lacks the control over the market that it had in the past," they note.
Howard's departure: A familiar name in energy policy circles is leaving government. Howard Gruenspecht, acting head of the Energy Information Administration, told colleagues he'll leave the Energy Department's independent stats and forecasting arm at the end of August.
He's been there 14 years and served as acting chief three times. I contacted former EIA administrator Adam Sieminski for some thoughts on his former colleague, and he responded quickly that American policymakers and taxpayers will miss him.
Here's a few of Sieminski's recollections...
Sieminski, now at the Center for Strategic and International Studies, credits Gruenspecht with helping to usher in some important advances at EIA, noting he knew how to get things done in a large bureaucracy. He says Gruenspecht particularly helped his efforts to get EIA to adapt to the age of big data, such as by playing a key role in ushering in the collection of hourly power generation stats.
What's next: Per Gruenspecht's memo to colleagues, EIA senior adviser John Conti will be appointed deputy administrator and serve as acting administrator when Gruenspecht departs. It's unclear when the White House will nominate a new administrator, but Gruenspecht, in the memo, said he's been informed that the process to find one is "well along."
Earth below us: Check out this new primer and video about NASA's Ice, Cloud and land Elevation Satellite-2 (ICESat-2), which is slated to launch next year with a system that will precisely measure the elevation of ice sheets, sea ice, and glaciers — and how they're changing.
Why it matters: Getting such exact measurements of topographic features will help track the effects of climate change.