Apr 3, 2017

Axios Generate

By Ben Geman
Ben GemanAmy Harder

Good morning and welcome back to Generate! I hope you had a nice weekend. Some good news for those who don't know already: Amy Harder joins the Axios energy team this week. Amy does great work and has broken tons of big stories for the Wall Street Journal and other stops, and we're thrilled she's here. If you don't already, you can follow her on Twitter at @amyaharder. Ok, let's dive back in . . .

Elon Musk's weekend update

Tesla announced Sunday that it delivered 25,000 vehicles to customers and produced 25,418 in the the first three months of 2017 — both quarterly records for the Silicon Valley electric automaker.

Why it matters: It's a good sign for the automaker as it prepares to launch the Model 3. The figures beat estimates, according to several reports, and the deliveries represent a 69 percent increase over the first quarter of 2016.

  • "The results should help fuel further investor confidence in Chief Executive Elon Musk as he works to bring out later this year a $35,000 sedan called the Model 3," the Wall Street Journal notes.

And why not: As long as we're on Tesla, while Musk might be among President Donald Trump's private sector advisors, he nonetheless doesn't think much of Trump's bid to revive the coal industry.

  • "It won't matter....Coal is dying due to nat gas fracking. It's basically dead," Musk tweeted over the weekend in an exchange about a story in The Verge on Trump's plan.
McCain: Don’t bail on the Paris climate deal

Deep into his new interview with Sen. John McCain, David Axelrod asks McCain whether the U.S. should pull out of the Paris climate deal:

  • "I don't think I would. I think I would certainly review it to see if there's excessive areas and all that, but I would not announce a pull out," McCain tells Obama's former top political adviser on his "Axe Files" podcast.

Why it matters: McCain is a prominent GOP voice on foreign policy, and the comments arrive as the White House is getting closer to a decision about its stance.

Memories:

Time was McCain made a big deal about climate change — he cosponsored cap-and-trade bills in 2003, 2005 and 2007. But he also opposes Obama-era regulations that Trump has started rolling back.

The EPA chief was on tv

EPA chief Scott Pruitt sparred with Fox News Sunday host Chris Wallace yesterday. He didn't really make news, but a couple of things stood out.…

Back to his climate safe(er) space: Pruitt declined the chance to repeat his claim from early March that carbon dioxide is not a primary contributor to global warming.

  • But he still stayed way outside the scientific mainstream by telling Wallace that while humans contribute to global warming "in some measure," the degree is unknown. The overwhelming view among scientists is that human-driven emissions have been the primary driver of warming since the mid-20th century.

The China message: Ahead of Trump's meeting this week with Chinese President Xi Jinping, Pruitt pushed back against the idea that Trump's climate policy rollbacks have ceded leadership to China on the topic, arguing the U.S. "has nothing to be apologetic about."

  • Pruitt noted that U.S. carbon emissions are already at their lowest levels since the mid-90s thanks largely to the fracking-driven growth of natural gas in power markets.
  • He contrasted that with China's pledge under the Paris accords, which allows an emissions peak as late as 2030. (There are signs it could happen much sooner.)
  • He argued it's "quite false" to think China and India are more committed to carbon reduction than the U.S.
Looking forward

Some noteworthy events this week....

Trump and Xi: Trump is hosting Chinese President Xi Jinping at Mar-a-Lago late in the week. The summit between the world's top two greenhouse gas emitters arrives as Trump weighs his options on the Paris climate accord, but it's not clear whether it will make the agenda.

  • Context: NPR chatted with Council on Foreign Relations energy expert Varum Sivaram about where the U.S and China stand ahead of the visit. He noted that China is "well poised to fill the void here in American leadership" and continue to be a powerhouse in global cleantech industries.
  • But...it's not all good: Sivaram said that China's goals are "not necessarily aligned" with the global goal of limiting climate change even as it moves toward cleaner power domestically. "China has an economic incentive to export, for example, inefficient coal power plants to other markets."

Cybersecurity:

The Senate Energy and Natural Resources Committee will hear from senior federal officials and other experts Tuesday when it gathers for a

hearing

on cyber threats to energy delivery.

Around the web

Weed: Bloomberg reports that energy-hungry legalized pot operations might not become as large of a new market as utilities had once envisioned.

  • "That's partly because the once-illicit business may no longer have to keep plants hidden from law enforcement and producers are upgrading to energy-efficient lights, pumps and cooling systems," the report says.

Money: A Wall Street Journal analysis finds that oil majors like Exxon and Shell are "struggling just to break even" despite cutting costs and experiencing a rebound in crude prices.

  • "For companies once known as profit machines — whose executives were hauled before Congress in 2005 to explain their enormous earnings — their cash problems demonstrate just how unprepared they were for a historic crash and tepid recovery in oil prices," the paper reports.

Influence: Via the Lobbying Disclosure Act database, here's the latest in the energy/environment influence world…

  • E2 Strategies is now representing the National Audubon Society and the Wilderness Society (filings here and here).
  • The National Venture Capital Association has brought on Capitol Tax Partners to work on tax reform.
Final thought

"In this business, I don't think much has changed since people were selling encyclopedias door to door or vacuum cleaners or anything else. I think the internet is great for data, but otherwise this is really about old-is-new business models," solar entrepreneur and expert Jigar Shah says.

That's one line from an interesting discussion on Greentech Media's latest Energy Gang podcast, which delves into what strategies work and don't work in the residential solar sales business.

Ben GemanAmy Harder

That's it for now! Thanks for reading, and please send tips (I promise to keep them confidential) and feedback to ben@axios.com.