With help from Annie Snider and Gavin Bade
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— An impasse over nuclear plant subsidies ahead of PJM Interconnection’s capacity market auction in August has left grid watchers concerned over what the final rules will be.
— The Trump administration is proposing a drinking water limit for the chemical perchlorate that is more than three times higher than EPA previously said was safe.
— Before heading home for the holiday, senators passed a long-awaited disaster aid package that would provide agencies like the Army Corps of Engineers and EPA funds to repair infrastructure and build more resilient installations.
TGIF! I’m your host, Kelsey Tamborrino. FirstEnergy’s Colin Mount knew William Howard Taft had the first official White House car — a White Model M steam car. For today: In 1868, who first designated May 30 as a memorial day? Send your tips, energy gossip and comments to ktamborrino@politico.com.
NO RULES OF ENGAGEMENT: The United States’ largest interstate electricity market will soon hold a multibillion-dollar auction to determine which power plants will supply it in the years to come. But more than six months after FERC tossed out the rules PJM had planned for the capacity market over the fairness of nuclear subsidies, federal regulators have yet to approve a rewrite — leaving some power players on edge, Pro’s Gavin Bade reports this morning.
PJM has never conducted a capacity market auction under invalidated rules — something that some observers worry could prompt FERC to throw out the auction results or issue refunds to generators if rules change. “My view is they should not run the auction unless FERC tells them it’s OK to run it under the old set of rules,” Joseph Bowring, the independent market monitor overseeing PJM, told Gavin.
Others are less concerned FERC will alter the results of the auction even if it proceeds under the invalidated rules. Ari Peskoe, director of the Harvard Electricity Law Initiative, said the commission typically avoids issuing refunds in wholesale power markets and is unlikely to order the auction be re-run. The most probable conclusion, he said, is that PJM runs its auction under invalidated rules this year, and then FERC approves new rules PJM proposed last year ahead of next year’s auction.
FERC, for its part, has been largely silent on the issue since it received PJM’s rewrite. Chairman Neil Chatterjee has said repeatedly the commission’s 2-2 split isn’t causing the delay, and instead has pointed to the complexity of the issues at play in wholesale markets. “I fully understand and my colleagues fully understand not just the complexity of this but the urgency with which to provide the clarity that market participants are looking for,” Chatterjee told reporters Thursday. “We are working on this every minute, every hour, every day and are going to continue to do so.”
PERCHLORATE PROPOSAL: The Trump administration proposed a drinking water limit of 56 parts-per-billion for perchlorate — the rocket fuel ingredient that is linked with thyroid problems — which is more than three times higher than the level EPA previously said was safe. EPA is also soliciting public comment on three other options: one limit that is higher, one limit that is lower, and reversing the decision to set a limit altogether.
It’s the latest move in a long-running saga over perchlorate, and is the first new drinking water limit that EPA has proposed since Congress amended the Safe Drinking Water Act in 1996, Pro’s Annie Snider reports.
PFAS implications: The perchlorate proposal comes as EPA plans to make a formal decision on whether or not the chemicals PFOA and PFOS warrant drinking water limits, and serves as a reminder that even if the agency decides to set a drinking water limit, it could be far higher than EPA’s health advisory level of 70 parts per trillion for those two chemicals.
“What [the perchlorate proposal] tells us is the underlying law is definitely broken,” said Erik Olson, the head of health program at the Natural Resources Defense Council, which sued to force the perchlorate proposal. “If EPA can be proposing a drinking water standard that is more than triple what they said is safe in drinking water … it clearly indicates we need to fix the underlying statute if we’re ever going to have health protective standards.”
ALASKA OIL LEASE SALE ON SCHEDULE: Interior is on track to complete a lease sale for oil exploration areas in the Arctic National Wildlife Refuge, Assistant Secretary for Land and Minerals Joe Balash told a Washington energy conference Thursday. The department will complete a final environmental impact statement by August, after which Balash said Interior expects to “complete a lease sale in the 10-02 area this calendar year.”
ICYMI: At the same conference, EPA Administrator Andrew Wheeler made the case Thursday for avoiding regulating methane emissions from oil and gas production, by instead splitting the industry into multiple discrete sectors — like production, processing, transmission and storage — rather than lumping those activities together for Clean Air Act accounting purposes, Pro’s Alex Guillén reports.
NOTHING LIKE THE LAST MINUTE: Senators in an 85-8 vote passed their long-awaited disaster aid package, H.R. 2157 (116), after reaching a deal with the president, POLITICO’s Marianne LeVine, Burgess Everett and John Bresnahan report. Although the House has left for Memorial Day recess, the legislation could theoretically be approved on a voice vote as soon as today.
But, the trio reports, Republicans are expected to reject a unanimous consent request, forcing the House to wait until June to pass the Senate bill.
So, what’s in it? The Senate measure would provide $3.25 billion to the U.S. Army Corps of Engineers to repair infrastructure damaged by extreme weather and construct more resilient installations, Pro’s Anthony Adragna reports. (See the breakdown here.) It also contains $311.9 million for the Interior Department to repair and rebuild damaged facilities, and $414 million for EPA — $349.4 million of which goes to state revolving funds to repair damaged drinking water infrastructure.
DEMS SAY WHEELER MISLED CONGRESS: Senate Environment and Public Works ranking member Tom Carper and House Energy and Commerce Chairman Frank Pallone are calling on Wheeler to provide documents related to the agency’s public defense of its proposed Safer Affordable Fuel-Efficient Vehicles rule.
In their letter, the Democrats say they are “concerned” that Wheeler has made “numerous public statements, including statements to Congress, that directly conflict with the information and analyses prepared by EPA’s career experts,” listing a mischaracterization of the emissions impact of the proposed rule as an example. Asked for comment on the letter, an EPA spokesperson told ME it “will respond through the proper channels.”
SENATORS INTRODUCE CARBON CAPTURE BILL: Bipartisan Sens. John Cornyn (R-Texas), Chris Coons (D-Del.), Bill Cassidy (R-La.) and Kyrsten Sinema (D-Ariz.) introduced the LEADING Act on Thursday amid a larger rollout by Senate Republicans of energy technology bills.
The bill would spur research and development of carbon capture technology for natural gas power plants by requiring DOE to establish a program to develop cost-effective carbon capture technologies, while also including participation by the national laboratories, universities and the private sector.
WHAT’S THE PLAN? Presidential candidate and former Maryland Rep. John Delaney released his $4 trillion climate change plan Thursday, most of which focuses on implementation of a carbon “cap and dividend” program. Delaney proposed starting the $15 fee on every ton of carbon dioxide emitted, which would increase by $10 per year until U.S. emissions fall by 90 percent compared to a 2015 baseline. Gavin has more details here.
ANOTHER ONE: Democratic contender Julián Castro said Thursday he has signed onto the “No Fossil Fuel Money” pledge, swearing off money from oil executives, lobbyists or PACs. Castro tweeted that his campaign has refused contributions from PACs, corporations, and lobbyists since Day One, but is now refusing contributions from oil, gas and coal executives “so you know my priorities are with the health of our families, climate and democracy.”
FOR YOUR RADAR: Former New York Mayor Michael Bloomberg will today announce $2.3 million to the University of Maryland’s Center for Global Sustainability and the Rocky Mountain Institute for the third “America’s Pledge” research report, on progress toward meeting Paris agreement goals, which will be presented to the U.N. at this year’s COP25.
— “Investigators sought appraiser’s help on Pruitt’s condo,” E&E News.
— “Exclusive: EPA to unveil less ambitious U.S. biofuel credit reform – sources,” Reuters.
— “Finding new opportunity for old coal-fired power plant sites,” NPR.
— “Mississippi floodway may be opened for just third time in history,” Bloomberg.
THAT’S ALL FOR ME!
