Document Rp1G9a0bDKy449NV1jy6nq657

To: From: Sent: Subject: Jackson, Ryan[jackson.ryan@epa.gov] Bloomberg BNA Tue 5/30/2017 8:03:34 PM May 30 - Energy and Climate Report - Afternoon Briefing Energy and Climate Report Afternoon Briefing - Your Preview of Today's News The following news provides a snapshot of what Bloomberg BNA is working on today. Read the full version of all the stories in the final issue, published each night. EPA Regulatory Review Floodgates Open, Leaving Pruitt to Mop Up Posted May 30, 2017, 7:01 A.M. ET By Andrew Childers When asked which EPA regulations stifle economic growth and should be reconsidered or rescinded, industry groups responded, "All of them." High-profile Obama-era regulations limiting carbon dioxide from power plants or establishing the reach of the Clean Water Act, which Environmental Protection Agency Administrator Scott Pruitt had opposed, will certainly be targeted. However, businesses are left wondering whether the agency, which so far lacks political appointees to run the EPA's water, chemicals and air pollution offices, will have bandwidth to tackle a host of other, less splashy regulatory fixes that could reduce costs or ease burdens. "We're in new territory. It's a process that has no clear precedent within the federal system," Randall Lutter, a professor of public policy at the University of Virginia and a former senior economist at White House Office of Management and Budget under President Barack Obama, told Bloomberg BNA. Open the Floodgates The EPA has received a barrage of requests from regulated industries to open and reconsider regulations from every sector the agency touches. The requests range from drastic changes to the way the agency regulates air pollution--Ameren suggested replacing the agency's ambient air standards with pollution trading programs--to the more targeted--the American Water Works Association recommended that the EPA streamline its application process for loans to improve drinking water systems. While a host of industries are looking ease their regulatory burdens, chemical manufacturer Chemours Co. actually went to bat for Obama-era rules that approved new chemicals to replace ozone depleting substances and clamped down on leaks from refrigeration equipment. The chemical company recommended that Pruitt retain those rules. Environmental and public health groups, of course, vow to fight any attempt to weaken EPA protections, with Earthjustice, the Sierra Club, and Clean Air Task Force calling the regulatory Sierra Club v. EPA, 1:17-cv-01906 ED_001523_00003269-00001 review process "an illegal and arbitrary sham." The Sierra Club has received funding from Bloomberg Philanthropies, the charitable organization founded by Michael Bloomberg, founder of Bloomberg L.P.Bloomberg BNA is an affiliate of Bloomberg L.P. The Waterkeeper Alliance also dismissed the process as rushed and opaque, calling on the EPA to provide more details about how it will manage the review process and decide which regulations will be reevaluated. Who's Driving the Process? Every new administration takes office vowing to streamline the regulatory process, but Trump has taken that further than ever before, requiring agencies to repeal two regulations for every new directive issued and capping costs that can be imposed on industries. It's an ambitious plan to transform the regulatory state, but seeing that process through will require coordination and planning. Right now the EPA is short of the political appointees necessary to make those decisions. "In any one of these big rulemakings, there are dozens of intermediate decisions made along the way," Jeffrey Holmstead, a partner at Bracewell LLP in Washington, D.C., who previously served as the EPA's assistant administrator for air pollution in the George W. Bush administration, told Bloomberg BNA. "If you have the administrator sign off on every one, you can only do two or three." Trump lags behind his predecessors in staffing the EPA, according to data provided by the Center for Presidential Transition. So far only Pruitt has been confirmed, and Susan Parker Bodine, Trump's pick for the agency's enforcement office, is awaiting confirmation. The Trump EPA lacks nominees to head the water, air and chemicals offices who will be central to the regulatory review process. Unlike past administrations, though, Trump has made easing burdens on businesses central to his domestic priorities. "The biggest single difference is that Trump has appointed someone to be EPA administrator whose primary focus is on reducing the regulatory burden," Holmstead said. When President George W. Bush took office, his EPA preferred legislative rather than regulatory approaches, Holmstead said. But when bills such as the Clear Skies Act faltered in Congress, that's when the Bush administration attempted to regulate pollutants such as mercury emissions from power plants. "In the air office, we were not as ambitious as the Trump administration when it comes to regulatory reform," Holmstead said. What's unknown is how the EPA will make decisions on which regulations it will target and when that process will get started. An EPA spokesman could not be reached for comment. Without assistant administrators to guide the process, Pruitt has appointed a regulatory reform task force of Ryan Jackson, the chief of staff; Byron Brown, the deputy chief of staff for policy; and Brittany Bolen, deputy associate administrator of the Office of Policy, to oversee the effort. All three previously served on the Senate Environment and Public Works Committee with past Chairman James Inhofe (R-Okla.), who was a vocal critic of the Obama EPA's regulations. Sierra Club v. EPA, 1:17-cv-01906 ED_001523_00003269-00002 "They are certainly knowledgeable enough to be looking for more regulations to be going after," Inhofe told Bloomberg BNA. "And they are doing the job pretty well." While agencies are tasked with implementing the regulatory reform efforts, the White House will still play a significant role in reducing compliance costs through the Office of Information and Regulatory Affairs, which reviews regulations, said Tracy Mehan, executive director of the American Water Works Association's government affairs office. "No doubt in a Republican administration, OIRA is very much empowered--not that they were pushovers in the Obama administration, but it's fair to say they're going to be more empowered," Mehan, who previously served as the EPA assistant administrator for water under President George W. Bush, told Bloomberg BNA. However, Neomi Rao, Trump's pick to head that office, also hasn't been confirmed. Smaller Fixes Have Big Benefits While rolling back the Clean Power Plan and replacing the Waters of the U.S. rule are top priorities for Pruitt, more modest updates to the EPA's various regulations could provide the biggest long term boons for businesses. Many industry groups in their comments are targeting smaller adjustments to existing regulations that they say can be quickly updated to reduce costs and make them more efficient. For example, the Class of'85 Regulatory Response Group, a coalition of 30 utility companies, suggested the agency eliminate unnecessary air pollution monitoring requirements. The Association of Air Pollution Control Agencies recommended streamlining a variety of air pollution permitting provisions to ease burdens on both businesses and state permitting officials. "Those [smaller fixes] would be valuable investments of time," Megan Berge, a partner at Baker Botts LLP who represents utilities and other industries, told Bloomberg BNA. "Those are the investments that have the possibility of having a lasting good in terms of making these programs efficient." Taking on the EPA's largest regulations will spark an inevitable battle with environmental groups, which could bog down the entire effort. But tackling some of the smaller changes sought by businesses could be a way for the Trump administration to claim some quick victories. "The good news is that, at least from EPA and the administration's perspective, these slight deregulatory acts are somewhat quicker than the big rules," Sam Batkins, director of regulatory policy at the American Action Forum, which has argued many EPA regulations have costs that exceed benefits, told Bloomberg BNA. "Maybe to some extent they can prioritize the small, minor tweaks to the rules and generate some savings." --With assistance from Dean Scott in Washington. Only Place in America Where Coal Demand Has Risen Is Nebraska Posted May 30, 2017, 9:21 A.M. ET By Tim Loh Sierra Club v. EPA, 1:17-cv-01906 ED_001523_00003269-00003 Looking for a rare bright spot in U.S. coal? Consider Nebraska, the only state producing more electricity from the fossil fuel than it did a decade ago, according to a Bloomberg analysis of U.S. government data. While America's slashed its coal-fired electricity generation by more than a third between 2006 and 2016--creating havoc for the coal sector, which once dominated the country's utility space--Nebraska raised its coal-fired power output by 6 percent, according to data from the U.S. Energy Information Administration. Nebraska's better known for corn. But it's home, too, to some of America's newest coal-fired power plants. In 2009, the Omaha Public Power District opened the almost 700-megawatt Nebraska City Station Unit II coal-fired facility. In 2011, the 220-megawatt Whelan Energy Center Unit 2 plant came online. Meanwhile, the Fort Calhoun nuclear power plant shut down for good last year. "That will bump up our reliance on coal a little bit," said David Bracht, director of the Nebraska Energy Office, in a phone interview. While Nebraska doesn't mine its own coal, it's located conveniently close to Wyoming, which is home to the Powder River Basin, America's largest and cheapest coal-producing region. Nebraska is also unique in that all of its utilities are publicly owned--a result of Great Depression-era legislation--which may have slowed its buildout of alternative energy sources, according to Bracht. That said, Nebraska's love affair with coal may have peaked in 2013, when it generated more than 26,000 gigawatt-hours of electricity from coal, according to the EIA. In 2016, it only generated about 22,000 gigawatt-hours from the mineral. Meanwhile, the state's roughly doubled the electricity it's generating from wind. "We have significant wind resources to be developed," Bracht said. "We expect that to be increased as well." 2017 Bloomberg L.P. All rights reserved. Used with permission World Carbon Price Seen Needing to Increase Sevenfold by 2020 Posted May 30, 2017, 8:51 A.M. ET By Mathew Carr Carbon prices need to jump sevenfold by 2020 from current rates in the world's biggest market to meet climate goals cost-effectively, according to a commission of economists and scientists. A price of about $40 a ton along with adoption of other policies that encourage emission cuts would achieve targets in the 2015 climate deal agreed in Paris, according to a report published May 29 by a commission of economists and scientists. Under the Paris agreement, almost 200 countries will try to limit the global temperature increase to "well below" 2 degrees Celsius (3.6 Fahrenheit) above pre industrial levels. Costs from the higher carbon prices would not hurt ordinary consumers much, said Joseph Stiglitz from Columbia University, who led the High-Level Commission on Carbon Prices with fellow Sierra Club v. EPA, 1:17-cv-01906 ED_001523_00003269-00004 economist Nicholas Stern. "Businesses are already using prices in the range that we're talking about," Stiglitz said on a call with reporters. New carbon prices in seven jurisdictions including China and South Africa will take the portion of global emissions covered to more than 20 percent in 2017, the World Bank said last week in a separate report. In Europe, which has the world's biggest greenhouse-gas market, lawmakers are meeting May 30 to deal with an accumulated glut that's driven down prices by more than four-fifths in the past decade. The commission concluded that a $40 to $80 a ton range in 2020, rising to $50 to $100 a ton by 2030, would be consistent with the Paris target. EU carbon settled Friday at 5.19 euros ($5.80) a ton on ICE Futures Europe in London. From the report: "Carbon pricing makes sense in all countries, but low-income countries, which may be more challenged to protect the people vulnerable to the initial economic impacts, may decide to start pricing carbon at a lower level and gradually increase over time": commission member Harald Winkler of the University ofCape Town, South Africa Commission analyzed national emissions and development pathways, technological road maps and global economic models to reach its conclusions Eliminating fossil-fuel subsidies would mean lower carbon prices are needed "A well-designed carbon price is an indispensable part of a strategy for efficiently reducing greenhouse gas emissions while also fostering growth." Report was put together starting last year by The Carbon Pricing Leadership Coalition, a voluntary partnership of national and sub-national governments, businesses, and civil society organizations that agree to advance carbon pricing through the global economy. It's housed in the Washington based World Bank Group. 2017 Bloomberg L.P. All rights reserved. Used with permission Trump Decides Next Week If He'll Quit Paris Climate Accord Posted May 27, 2017, 03:06 P.M. ET By Joe Ryan and Josh Wingrove Donald Trump continued to distance himself from fellow world leaders over climate change at the G7 summit, and said he'll determine next week whether to pull the U.S. out of the landmark Paris climate accord. "I will make my final decision on the Paris Accord next week!" the president told his almost 31 million Twitter followers on Saturday. Sierra Club v. EPA, 1:17-cv-01906 ED_001523_00003269-00005 Trump, who for months has delayed a decision on the climate agreement, made his announcement at the conclusion of the Group of Seven summit in the resort town of Taormina, Italy. In an unprecedented step, the U.S. broke from the other six nations in a joint statement issued at the summit's conclusion, saying America is reviewing its climate policies while the G-7 members others remain committed to the Paris Agreement. Climate was among the most disputed issues separating Trump from other leaders at the two-day meeting on the Sicilian coast. A top White House adviser said the president's views were evolving on the issue, but Trump wasn't immediately swayed by arguments from Chancellor Angela Merkel of Germany, France's President Emmanuel Macron and others to honor the Paris Agreement, brokered in 2015 by almost 200 nations to slash fossil fuel emissions and boost funding to ease impacts of global warming. "The whole discussion about climate has been difficult, or rather very unsatisfactory," Merkel told reporters after the summit. "Here we have the situation that six members, or even seven if you want to add the EU, stand against one." `Stark Isolation' Diplomats spent days trying to hammer out language for the G-7 joint statement. Past communiques, which are painstakingly crafted to reflect common goals and values of all seven nations, have dedicated lengthy sections to climate change. At one point this week, the words "Paris Agreement" were nearly excluded from the statement, underscoring how contentious the issue became in Taormina, said a Canadian government official who spoke on the condition on anonymity to discuss private deliberations. Trump, who once said the concept of global warming "was created by and for the Chinese in order to make U.S. manufacturing non-competitive," repeatedly vowed to pull out of the Paris deal during his election campaign, but has sidestepped the issue since taking office. Delaying a decision about the accord provided opportunity for G-7 leaders and Pope Francis to press Trump to honor U.S. environmental commitments. Now the president heads back to Washington, where much of his party is pushing him to do the opposite. Issue Deadlock Last week, 22 Republican senators, including Majority Leader Mitch McConnell, sent a letter to Trump urging him to exit the Paris accord. Members of his administration, meanwhile, are deadlocked on the issue. Environmental chief Scott Pruitt and top strategist Steve Bannon are pushing for a pullout. Secretary of State Rex Tillerson, White House adviser Jared Kushner and Ivanka Trump, the president's son-in-law and daughter respectively, have urged the president to stay in the deal. John Kirton, director of the University of Toronto's G8 Research Group, said Trump's trip home may not bode well for those in favor of Paris. "If you let him go back to the civil war within the White House, Pruitt might win," he said. Trump has criticized efforts to cut emissions, saying they limit U.S. economic competitiveness. The president's views on the Paris accord, however, are evolving, White House National Economic Council director Gary Cohn told reporters Friday in Italy. Trump may be willing to stay in the agreement, Cohn said, if the U.S. can scale back commitments made by former President Barack Sierra Club v. EPA, 1:17-cv-01906 ED_001523_00003269-00006 Obama. "His views are evolving, and he came here to learn," Cohn said. "His basis for decision is ultimately going to be what's best for the United States." The Paris Agreement is broader than any previous climate accord. It calls for reducing pollution in hopes of limiting global warming to 2 degrees Celsius (3.6 degrees Fahrenheit) above temperatures at the outset of the industrial revolution. Hundreds of corporations and investors have endorsed the pact, including oil majors Royal Dutch Shell Plc, BP Plc and Exxon Mobil Corp., which was previously led by Tillerson. Alden Meyer, who's followed climate talks for two decades as director of policy at the Union of Concerned Scientists, said Trump's reluctance to support it puts him at odds with much of the world. "He stands in stark isolation," Meyer said. "The leaders from Europe, Canada, and Japan have made it crystal clear that they intend to fully implement their national commitments under the Paris Agreement." --With assistance from Jennifer A. Dlouhy. 2017 Bloomberg L.P. All rights reserved. Used with permission Privacy Policy | Terms of Service | Manage Your Email | Contact Us 1801 South Bell Street, Arlington, VA 22202 Copyright 2017 The Bureau of National Affairs, Inc.. Energy and Climate Report Sierra Club v. EPA, 1:17-cv-01906 ED_001523_00003269-00007