Washington Energy Update

As the November 8th elections approach, Congress is in recess to allow Members and Senators time to campaign. They will return on November 14 as a Lame Duck congress, with various measures still needing to be addressed before year’s end. The legislative agenda for the remainder of 2016 will, in many ways, be dictated by the outcome of the election of Hillary Clinton or Donald Trump to the presidency. Also at play is the question of whether Republicans will maintain their House and Senate majorities. For now, the House majority is likely safe, although the GOP is expected to lose some seats, but the Senate is a toss-up with Democrats making a play to retake the majority. Of the 34 Senate seats up for election in November, 24 are currently held by Republicans, giving the Democrats a wider range of opportunities for pick-ups.

From a global perspective, 72 parties accounting for 56.75 percent of global greenhouse gas emissions have, as of October 5, joined the climate agreement negotiated at COP21 in Paris, meeting the requirements of 55 parties representing 55 percent of global emissions needed for the Paris Agreement to enter into force in 30 days, prior to the COP22 meeting in Morocco. Energy Secretary Ernest Moniz, “Passing the threshold for the Paris Agreement’s entry into force is a historic moment, marking a new era of global consensus on climate change action. This agreement will further accelerate development of a multi-trillion dollar market for clean energy technology solutions that reduce heat-trapping emissions….The central challenge for this new era will be to accelerate the deployment of energy technologies, develop new innovative low-carbon solutions quickly, meet the goals our nations have declared before the world, and encourage even greater ambition.”

CONGRESS

When Congress returns next month, the primary energy issue remaining on the calendar is the energy bill. While conferees have been appointed by the House and Senate, here has only been one formal conference meeting to discuss the measure, although staff are reportedly doing behind-the-scenes work to position the energy bill for action in the Lame Duck. 

Another potential Lame Duck agenda item is a tax extenders package, which would address the renewable energy and energy efficiency tax provisions which were left out of the extension language approved in December 2015. These technologies include fuel cell power plants, microturbines, small wind energy property, combined heat and power systems, and geothermal heat pumps. A tax extenders package could be approved as part of a year-end Omnibus bill.

Related to last year’s tax extenders deal, which extended both wind and solar credits but left out offshore wind, on September 15, Rep. Jim Langevin (D-RI) introduced the Offshore Wind Incentives for New Development (WIND) Act, which is a companion bill to S. 3036, introduced earlier this year by Sens. Ed Markey (D-MA) and Sheldon Whitehouse (D-RI). The Offshore WIND Act would extend until 2025 the Investment Tax Credit for offshore wind which is currently set to expire in 2019. Due to the relatively longer process of siting and building turbines offshore, the Department of Energy has found that no offshore wind projects are projected to qualify for this tax credit before it expires. The bill has 15 cosponsors.

Hearings

On September 7, the House Energy and Commerce Subcommittee on Energy and Power held a hearing on “Federal Power Act: Historical Perspectives” with testimony from representatives of the Federal Energy Regulatory Commission and the Department of Energy.

On September 15, the House Energy and Commerce Subcommittee on Energy and Power held a hearing on “The Department of Energy’s Role in Advancing the National, Economic, and Energy Security of the United States” with testimony from Energy Secretary Ernest Moniz.

Legislation Introduced

Rep. Mike Pompeo (R-KS) has introduced the Power and Security Systems (PASS) Act which provides for consideration of the extension under the Energy Policy and Conservation Act of non-application of No-Load Mode energy efficiency standards to certain security or life safety alarms or surveillance systems.

Rep. Matt Cartwright (D-PA) has introduced the Scoring Calculations for Our Residential Energy (SCORE) Act, which authorizes the Department of Energy to assess and score new and existing homes for cost-effective reductions in energy use. A score document would grade the home on its energy consumption for heating, cooling, water heating, and other variables.

Rep. Ryan Zinke (R-MT) has introduced the CO2 Regulatory Certainty Act, which would amend the Internal Revenue Service Code of 1986 to enhance the requirements for secure geologic storage of carbon dioxide for purposes of the carbon dioxide sequestration credit.

Rep. Mark Takano (D-CA) has introduced the Storage Technology for Operational Readiness and Generating Energy Act (S.T.O.R.A.G.E. Act), which amends the Public Utility Regulatory Policies Act of 1978 to require that electric utilities consider an investment in an energy storage system based on several factors including total costs and normalized life cycle costs, cost effectiveness, improved reliability, security, and system performance and efficiency.

ADMINISTRATION

Montreal Protocol Agreement to Cut Use of HFCs

Meeting in Kigali, Rwanda, the United States and nearly 200 other nations reached an agreement to amend the Montreal Protocol to phase down the production and use of potent heat-trapping chemicals known as hydrofluorocarbons (HFCs). According the Energy Secretary Ernest Moniz, the agreement unlocks $80 million, including $53 million from philanthropic partners, to help developing countries that have chosen to take early action to decrease HFC use and increase energy efficiency. The Department of Energy is working with industry partners and national labs to develop a new generation of air conditioning and heating technologies to revolutionize the industry by utilizing low- to zero-global warming potential (GWP) innovations.

National Offshore Wind Strategy

The Department of Energy’s Wind Energy Technology Office and the Department of Interior’s Bureau of Ocean Energy Management have released an updated national strategy to facilitate the responsible development of offshore wind energy in the United States. According to the National Offshore Wind Strategy: Facilitating the Development of the Offshore Wind Industry in the United States, offshore wind could help enable 86 gigawatts of offshore wind in the U.S. by 2050. The strategy was published just weeks after construction was completed on America’s first offshore commercial wind farm off of Block Island, RI. The new 30 MW wind farm was BOEM’s first right-of-way grant and is expected to start operating by the end of 2016. It will generate enough electricity to power 17,000 homes in New England.

DOE Report on Deployment of Clean Energy Technologies

The Department of Energy has released a new report that highlights the accelerated deployment of five clean energy technologies: wind turbines, solar technologies for both utility-scale and distributed photovoltaic (PV), electric vehicles (EVs) and light-emitting diodes (LEDs). The report, Revolution…Now, was announced by Secretary Moniz during a discussion at The Atlantic’s Washington Ideas Forum. Revolution…Now is annually updated and describes the decreasing cost and increasing deployment of clean-energy technologies in the United States. As the world continues to move toward a low-carbon economy, this 2016 update released today builds upon last year’s edition and details the economic and environmental benefits our nation is already starting to realize thanks to the increased deployment.