Energy Update (December 13)
This week, President-elect Biden announced the following nominees, appointees, and advisers:
General Lloyd Austin, Secretary of Defense
- Retired four-star General with more than 40 years of military service
Xavier Becerra, Secretary of Health and Human Services
- Current Attorney General of California
Tom Vilsack, Secretary of Agriculture
- Confirmed by unanimous consent in the Senate in 2009 to serve as Secretary of Agriculture – served from 2009-2017
Marcia Fudge, Secretary of Housing and Urban Development
- Current representative for the 11th Congressional District of Ohio
Denis McDonough, Secretary of Veterans Affairs
- Served as White House Chief of Staff, Deputy National Security Advisor, and Chief of Staff of the National Security Council during the Obama-Biden administration
Katherine Tai, United States Trade Representative
- Served as the chief lawyer for the House Ways and Means Committee
Susan Rice, Director of the Domestic Policy Council
- Served as National Security Advisor from 2013-2017
- Served as U.S. Ambassador to the United Nations from 2009-2013
Dr. Rochelle Walensky, Director of the Centers for Disease Control and Prevention (CDC)
- Chief of the Division of Infectious Diseases at Massachusetts General Hospital and Professor of Medicine at Harvard Medical School
Dr. Vivek Murthy, Surgeon General
Dr. Marcella Nunez-Smith, COVID-19 Equity Task Force Chair
Dr. Anthony Fauci, Chief Medical Adviser to the President on COVID-19 and Director of the National Institute of Allergy and Infectious Diseases
Jeff Zients, Coordinator of the COVID-19 Response and Counselor to the President
Natalie Quillian, Deputy Coordinator of the COVID-19 Response
Tom Vilsack, nominee for Secretary of Agriculture, served in the role for eight years under the Obama-Biden administration, and served two terms as the Governor of Iowa. While secretary, Vilsack oversaw increased investments in rural communities, new policies for the nation’s school meal system, and increased food safety standards. Under the Biden-Harris administration, the Department of Agriculture is expected to play a key role in various climate priorities.
Vilsack was selected as a traditional choice for the role and will likely continue the department’s focus on the well-being of farmers. He is expected to make climate change a core issue in his second tenure and could expand grants that incentivize farmers to capture and store carbon in soil. Vilsack was unanimously confirmed by the Senate in 2009.
Iowa Sen. Chuck Grassley (R) said he would be happy to have Vilsack return as Secretary of Agriculture. “Two reasons—one, he understands the role of the family farmer and the importance of that institution in the production of food,” Grassley said.
To view a full list of the Biden-Harris nominees, appointees, and White House staff, click here.
On Wednesday (Dec. 9), the House passed a one-week stopgap spending bill, moving the government funding deadline from Friday (Dec. 11) to Friday (Dec. 18). Lawmakers have funded the government by a continuing resolution (CR) since September. On Friday (Dec. 11), the Senate passed the CR.
If they do not reach an agreement on a spending package by Dec. 18, a shutdown could be avoided by passing another CR that would extend until early next year.
Congressional leaders and appropriators are negotiating both a $1.4 trillion,12-bill spending package as well as COVID-19 stimulus. Committee leaders in both chambers have begun negotiations on noncontroversial aspects of the relief package, including small business funding.
A bipartisan group of senators released the framework for a $908 billion COVID-19 stimulus package this week. This legislation includes $300 billion for the Paycheck Protection Program (PPP), extends unemployment insurance programs by 16 weeks, and $160 billion for state, local, and tribal governments.
To view a framework summary of the “Bipartisan Emergency COVID Relief Act of 2020,” click here.
The House and Senate both passed the National Defense Authorization Act (NDAA) this week with veto-proof majorities. On Tuesday (Dec. 8), President Trump tweeted that he would veto the NDAA unless it repeals Section 230. Trump also wanted Congress to remove a provision that allows the renaming of military bases that honor Confederate leaders.
This week, a group of House Republicans wrote a letter to Federal Reserve Chair Jerome Powell and Fed Vice Chair for Supervision Randal Quarles and warned against proceeding with climate risk regulations for the financial system. The letter is the first political challenge to the Fed’s new efforts.
The 47 Republican lawmakers discouraged the Fed from imposing stress tests on lenders to measure their vulnerability to climate change. The members also argued the Fed should limit its involvement in the International Network for Greening the Financial System.
Stress tests on climate could measure banks’ resilience to financial risks posed by extreme weather and the transition to a carbon-neutral economy.
This work is expected to accelerate under the incoming Biden administration. Treasury Secretary nominee Janet Yellen has signaled climate change will be a prevalent issue for the financial system.
House Republican Conference Chair Liz Cheney (R-WY), as well as several members on the Financial Services Committee, signed the letter.
To view the letter, click here.
On Tuesday (Dec. 8), the House of Representatives passed the conferenced version of S. 1811, the Water Resources Development Act (WRDA) of 2020.
The bill would approve 46 new flood control, harbor, ecosystem, and local and dam projects on waterways across the country. Additionally, it would authorize the study of 27 other projects, as well as increase the use of funds for harbor maintenance and dredging. It also would give flexibility to the Army Corps of Engineers to undertake projects aiding low-income and disadvantaged communities.
However, Senate Appropriations Chair Richard Shelby (R-AL) has raised objections to language in the bill related to the spending for port and harbor dredging, which complicates the path forward in the chamber.
Republicans have been pushing to advance the bill as part of the year-end spending package, but the legislation could also be moved on its own.
To view the legislation, click here.
On Wednesday (Dec. 9), the Environmental Protection Agency (EPA) finalized a rule that requires the agency’s cost benefit analyses to segregate and downplay international benefits and co-benefits for Clean Air Act regulations. The rule also requires the EPA to differentiate domestic and foreign benefits.
“The agency can still take into account co-benefits. This does not stop that,” EPA Administrator Andrew Wheeler said.
“But what it does do is require the agency to be upfront about how they’re addressing that,” he added.
The rule will take effect immediately once published in the Federal Register.
To view the final version of the rule, click here.
To view an agency fact sheet, click here.
The EPA also released the text of its final soot review rule. The rule retains, without changes, the current national standards for particulate matter.
To view the rule, click here.
A bipartisan group of lawmakers are pushing for broad energy-related tax policy changes in the last days of the 116th Congress. The proposals cover carbon capture, hydrogen energy, and home heating units.
Senate Finance Chairman Chuck Grassley (R-IA) told reporters on Tuesday (Dec. 8) that talks continue on possible tax extensions. An agreement could go through on the year-end spending deal, or the COVID-19 relief package.
A bipartisan group of senators, including Shelley Moore Capito (R-WV), John Barrasso (R-WY), and Joe Manchin (D-WV), introduced legislation to extend the 45Q tax credit for five years.
“These small modifications, following the models of previous energy policies that are supported by members of both parties for now well-established industries, will make a big difference in putting American innovation to work growing our economy and combating climate change in a responsible way, regardless of the current economic circumstances,” Capito said in a statement.
Representatives David McKinley (R-WV) and Marc Veasey (D-TX) introduced companion legislation in the House last week.
To view the bill, click here.
A pair of Senate lawmakers also introduced legislation this week that would expand the production tax credit (PTC) to additional technologies.
Senators Sheldon Whitehouse (D-RI) and Todd Young (R-IN) proposed the bill, which would enable hydrogen energy technologies to qualify for the PTC.
“We need to find alternative low-carbon fuels to power the economy,” Whitehouse said.
“Our bipartisan hydrogen-based energy incentive holds promise to open additional carbon-free pathways as we reassert America’s global leadership on climate change,” he added.
To view the legislation, click here.
Separately, Sen. Angus King (I-ME) introduced a bill that would provide a tax credit for homeowners who install energy-efficient heat pumps.
To view a press release from King’s office, click here.
Senators Chris Coons (D-DE) and Mike Braun (R-IN) introduced legislation on Wednesday (Dec. 9) that would support the global effort to plant one trillion trees to help sequester carbon.
The “Trillion Trees and Natural Carbon Storage Act” would authorize new efforts at the Departments of State and Agriculture to align the U.S. with the World Economic Forum’s Trillion Trees Initiative.
To view the bill, click here.
Canadian Prime Minister Justin Trudeau announced on Friday (Dec. 11) that his government is planning to increase the national carbon tax to C$170 per metric ton in 2030. The move is a key change in the government’s new climate plan to exceed its emissions targets under the Paris Climate Agreement.
The plan includes 64 new measures and C$15 billion in spending to reduce emissions and enhance the low-carbon economy.
 Warmbrodt, Zachary. “Republicans warn Powell about Fed plans for climate regulation.” Politico, 10 Dec. 2020. https://link.edgepilot.com/s/0082c58d/MS-e7mV3_0yFRmpdUT4k4A?u=https://www.politico.com/news/2020/12/10/republicans-federal-reserve-climate-regulation-444194
 Tamborrino, Kelsey. “Grijalva defends Haaland for Interior.” Morning Energy, 10 Dec. 2020. https://link.edgepilot.com/s/2ddc415a/U0dK01J8BEOTuRViol8GOg?u=https://www.politico.com/newsletters/morning-energy/2020/12/10/grijalva-defends-haaland-for-interior-792183
 Dillon, Jeremy. “Lawmakers make last-minute push for flurry of energy credits.” E&E Daily, 9 Dec. 2020. https://link.edgepilot.com/s/4bcec04b/vlWkZK_sIUusiJZa2REOtQ?u=https://www.eenews.net/eedaily/2020/12/09/stories/1063720217
 “Canada plans to ramp up carbon price as part of climate change fight -Ottowa.” Reuters, 11 Dec. 2020. https://link.edgepilot.com/s/3d4d9652/cWehoSKKLECTDnMjnRMPLw?u=https://financialpost.com/pmn/business-pmn/canada-plans-to-ramp-up-carbon-price-as-part-of-climate-change-fight-ottawa-3