With help from Anthony Adragna, Annie Snider and Daniel Lippman
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— Two top Trump administration officials are on the Hill today to defend the president’s budget request for fiscal 2021.
— The U.S. LNG industry isn’t seeing any gains from the president’s trade deal with China, which was touted as a win for the energy industry.
— Several Cabinet officials are set to announce a cross-government effort today on water reuse.
WELCOME TO THURSDAY! I’m your host, Kelsey Tamborrino. Check out the POLITICO Energy podcast — all the energy and environmental politics and policy news you need to start your day, in just five minutes. Listen and subscribe for free at politico.com/energy-podcast.
The trivia winner is FERC’s Joe McClelland, who correctly answered that there were 35 national parks and monuments under the National Park Service when it was created in 1916. For today: Which Congress was the first to have 435 members in the House? Send your tips, energy gossip and comments to ktamborrino@politico.com.
TIME TO TALK SPENDING: Both Energy Secretary Dan Brouillette and EPA Administrator Andrew Wheeler are on Capitol Hill today for hearings on their agencies’ budgets for fiscal 2021. The appearances will give lawmakers a chance to press the Trump officials on a range of issues, including nuclear waste storage and PFAS chemicals.
As in previous years, President Donald Trump’s budget requests for both EPA and the Energy Department call for cuts that won’t fly with lawmakers. For EPA, Trump is seeking a nearly 27 percent decrease, and calls for reducing Superfund money by $113 million and cutting spending for programs like those under the Clean Air Act, Clean Water Act and Safe Drinking Water Act.
A House Energy and Commerce Committee aide told ME to expect Wheeler to be questioned on the agency’s Superfund backlog and reinstating funding for the program, following the Associated Press’ recent report that EPA under Trump completed the fewest cleanups of Superfund sites in more than 30 years. The aide also said to expect the administrator to be questioned about climate change broadly and Trump’s regulatory rollbacks, including on CAFE standards. Several Democrats on the committee, including Michigan Rep. Debbie Dingell, have also been vocal on EPA’s plans for toxic PFAS chemicals, making it very likely Wheeler will be pressed about the administration’s action plan.
Trump is also calling for an 8 percent reduction in DOE’s budget. He proposes slashing funding for DOE’s Office of Energy Efficiency and Renewable Energy for the third year in a row, as well as eliminating the Advanced Research Projects Agency-Energy. Brouillette, who is appearing for the first time on the Hill since his confirmation as secretary, is sure to be questioned about the Trump administration’s plans following its about-face on the Yucca Mountain nuclear waste repository. He’ll also likely be asked about DOE’s recent moves on energy efficiency, and changes to its process rule and testing procedures.
If you go: Wheeler is up first at 10 a.m. before the House Energy and Commerce Environment and Climate Change Subcommittee in 2123 Rayburn. Brouillette will appear before the House Appropriations Energy-Water Subcommittee at 2 p.m. in 2362-B Rayburn.
SUBPOENA WAIT CONTINUES: House Natural Resources Chairman Raúl Grijalva told reporters he intended to issue subpoenas “soon” to Interior and warned any court battle over them would suggest the administration has something to hide. He expressed particular interest in contacts between the administration and fossil fuel companies ahead of revisions to the National Environmental Policy Act, as well as a mountaintop mining health study canceled early in the Trump administration. (Grijalva asked CEQ for information on the NEPA contacts in a Feb. 20 letter).
“I think the process around NEPA was rigged and that they canceled the health study because of the pressure from the coal companies. OK, prove me wrong. If they litigate it, I think it just reinforces that maybe that opinion is correct,” Grijvala said. Earlier this month, the Arizona Democrat said he anticipated legal battles over the forthcoming subpoenas.
NATURAL RESOURCES DEMS UNVEIL EJ BILL: Grijalva and Rep. Donald McEachin (D-Va.) will unveil the environmental justice legislation today that they’ve been working on for a year and a half. The Environmental Justice for All Act would create a Federal Energy Transition Economic Development Assistance Fund from fees on fossil fuel companies, which in turn would support communities and workers to transition away from “greenhouse gas-dependent economies.” The legislation would also put millions into grants supporting education, research and development into environmental and public health projects in environmental justice communities.
It would also require the consideration of cumulative impacts in permitting decisions under the Clean Water Act and the Clean Air Act and require “federal agencies to provide early and meaningful community involvement opportunities under NEPA when proposing an action affecting an environmental justice community,” according to a bill summary shared with ME.
TREES COMPANY: Democrats on the Natural Resources panel used Wednesday’s legislative hearing on two climate bills to send a message to Republicans: Tree planting alone isn’t enough. Pro’s Anthony Adragna reports that while panel Democrats expressed concern that Rep. Bruce Westerman‘s (R-Ark.) legislation H.R. 5859 (116) would allow continued logging without sufficiently combating deforestation, they also stressed that it would be necessary to sequester more carbon emissions in trees and soil. But they said those approaches would not be enough to rapidly wean the country off fossil fuels to avoid the worst effects of climate change.
“We all agree that nature-based solutions are critical to combat climate change, but we must not lose focus on what science tells us we must do to stabilize global temperatures and avoid catastrophic impacts,” Grijalva said during the hearing. The chairman told reporters he granted the hearing on Westerman’s bill because he’s “very generous” but does not plan to hold a markup and does not support the legislation. He expressed concern it would only distract from more ambitious legislation necessary to address the problem.
Westerman agreed his bill is “absolutely not” a silver bullet solution to climate change but said it would offer a positive contribution in addressing the problem. “My legislation represents a pragmatic, science-based, first step in addressing global carbon emissions,” he said. “Sure, we need to reduce the amount of carbon going into the atmosphere, but what do you do about the carbon that’s already in the atmosphere? And trees are the natural, logical answer to that.”
GIVE US THE DETAILS: Democratic senators, including 2020 presidential candidate Elizabeth Warren, wrote to BlackRock CEO Larry Fink to request more details on how the asset manager will assess companies’ commitment to addressing climate change, Pro’s Zack Colman reports. The letter follows Fink’s January letter to CEOs and clients outlining the firm’s intent to center sustainability in its investing strategy. The senators on Wednesday said BlackRock’s plan for implementing that vision is vague and ask Fink to write back with details on the “tangible actions” he plans to take.
LNG FEELING CHILL AFTER CHINA TRADE DEAL: The president has cheered his trade deal with China as a win for the U.S. energy industry, but so far it has been more bust than boom for liquefied natural gas sellers along the Texas Gulf Coast, industry sources and analysts told Pro’s Ben Lefebvre. Several industry sources said the White House has still not shared details about how China would proceed with the promised energy purchases of $50 billion over the next two years. And the terms surrounding Beijing’s pledge to ease the 25 percent tariff on imports of U.S. LNG will likely prevent Chinese buyers from committing to the long-term investments that developers of export projects in Texas and Louisiana are seeking.
China announced earlier this month that would-be importers of U.S. natural gas could apply for exemptions to its tariffs. But those exemptions would expire after one year — likely too short to entice companies to sign contracts of 10 years or more that the U.S. LNG producers need to secure financing for their new plants, said Charlie Riedl, executive director of trade association Center for Liquefied Natural Gas. “It’s unlikely a Chinese buyer is going to sign up for a long-term contract if the tariff exemption is only for one year,” Riedl said.
GOING STRONG: In the face of the Trump administration’s threats to California’s emissions trading agreement with Quebec, both the Golden State and Quebec sold all of the greenhouse gas allowances they offered in this month’s cap-and-trade auction, Pro’s Debra Kahn reports. California and Quebec sold permits to cover companies’ 2020 and 2023 emissions, at prices more than $1 per ton above the state-set floor price of $16.68 per ton. California raised $612 million total from the sale and Quebec raised $246 million in Canadian dollars.
REUSE THIS: A trio of Cabinet secretaries is due at EPA this afternoon to announce a cross-government effort to increase the reuse of water as a way of dealing with drought and increasing demand in many states across the country. While water wonks have long argued that water reuse must be part of the solution for tightening supplies, major progress has been hindered by questions like who should regulate how clean water produced from oil and gas operations must be in order to be used as agricultural irrigation water. EPA last year put a draft National Water Reuse Action Plan out for public comment.
EPA TO REDUCE RFS REFINERY EXEMPTIONS: EPA will drastically reduce the number of exemptions it grants to small refineries looking to reduce their 2020 ethanol blending requirements under the Renewable Fuel Standard, Pro’s Eric Wolff reports. The agency will apply across the nation a 10th Circuit Court ruling from January that voided three previous EPA exemptions. The court said only refineries that had exemptions continuously since 2011 could apply for new ones.
While EPA does not disclose the names of the refiners that received waivers, biofuels and oil industry sources have said the number of eligible small refineries could be as few as three. The agency, which declined comment, is now reviewing 23 petitions for exemptions, and it appears most of those will be rejected, one person in the oil industry and another person familiar with the decision said.
In response, Iowa Sen. Chuck Grassley tweeted that he was glad to see Wheeler “seems 2b taking farmer concerns seriously This wld be a major promise kept by Pres @realDonaldTrump &help him in Iowa+the Midwest.” Chet Thompson, president and CEO of the American Fuel and Petrochemical Manufacturers, released a statement calling the issue unsettled, and said Trump and his EPA should fight the ruling and limit its impact. “If President Trump is serious about his promise to protect small refineries and the women, men, and communities that rely on them, he would appeal this decision,” he said.
INTERIOR SAYS NO IMPACT ON COAL LEASING MORATORIUM: The Bureau of Land Management concluded Wednesday that lifting a moratorium on federal coal leasing early had no significant environmental impacts, completing a key step toward resuming leasing, Pro’s Alex Guillén reports. The announcement follows former Interior Secretary Ryan Zinke’s reversal of a Obama-era move that stayed the leasing as part of a broader review of the federal coal program. Last year however a federal judge faulted Zinke’s decision because the department did not conduct any review under NEPA.
In its final environmental assessment and its finding of no significant impact, BLM concluded that the temporary nature of the Obama-era moratorium meant that the environmental and climate effects associated with new coal leases were merely delayed, not avoided. That means Zinke’s decision to lift the moratorium early “created no significant, unstudied impacts.”
— Claire Nance has joined the White House Communications Office as a government communications adviser. Nance most recently was a press assistant at the Department of Energy.
— “When safety rules on oil drilling were changed, some staff objected. Those notes were cut,” via The Wall Street Journal.
— “The climate impact no one can ignore: A dead phone,” via E&E News.
— “EPA handling multiple PFAS-related criminal investigations,” via Bloomberg Environment.
— “Navajo company reaches immunity deal with U.S. for coal mines,” via Associated Press.
Did we miss anything? Send future events to: energycalendar@politicopro.com.
THAT’S ALL FOR ME!
