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Energy

Every two weeks Viohl & Associates publishes an Energy Update, which provides summaries of significant federal and state energy news.  

Energy Update, May 27

May 31, 2016

In the States

IA – Governor Terry Branstad signed legislation to extend the state’s biodiesel incentives through 2024. The measure retains a state tax credit – two cents per gallon on the first 25 million gallons of production per biodiesel plant – that “helps keep Iowa’s 13 biodiesel producers competitive on a national scale.” The bill also extends a retailers’ credit, which encourages fuel retailers to sell higher blends of biodiesel. According to state officials, in 2015 Iowa’s biodiesel plants produced a record 242 million gallons of biodiesel, supporting at least 3,000 jobs and providing nearly $345 million in economic impact in the state. "We’re pleased to be here in Newton, which is the leader in biodiesel,” the governor said. “We’ve come a long way in the past 20 years, and we want to continue to have Iowa be a leader in renewables, be it ethanol, other biodiesels or wind energy.” Branstad signs bill to expand biodiesel incentives in NewtonThe Newton Daily News

MI – Governor Rick Snyder declared a state of energy emergency via executive order due to a potential shortage of gasoline in Michigan thanks to the shutdown of a Wisconsin fuel pipeline and a power outage at a Detroit refinery. The Governor’s order will allow vehicles transporting fuel “to spend more hours on the road to ensure fuels are available,” suspending state fuel transportation and hours-of-service regulations until June 6th.  The executive order, however, does not waive environmental rules. “We want to make sure the fuel Michiganders need for their travels to work, school or a long weekend trip is available,” Governor Snyder said. “This executive order will help ensure there are no artificial shortages of fuel impacting the state’s residents or visitors.” The last time Governor Snyder declared a statewide energy emergency was in July 2012. Snyder declares energy emergency over fuelThe Detroit News

MT – Governor Steve Bullock attended the ribbon-cutting of a new community solar energy project in the state’s southwestern Bitterroot Valley. The project, spearheaded by the nonprofit Ravalli Electric Cooperative, includes two sets of 88 solar panels that have already produced nearly 11,000 kilowatt-hours of energy since beginning operations in early April. “Today we are seeing a great example of forward-thinking leadership,” Governor Steve Bullock said. “As a result, not only are you meeting the expectations of your customers and harnessing home-grown energy from the sun, but you’ve put more Montanans to work in doing so – from the local electricians to the Montana company that fabricated the racks.” The Bitterroot Valley farm is the third community solar project in Montana, all of which are operated by electric cooperatives. Governor attends REC Valley Solar project ribbon cuttingThe Ravalli Republic News

UT – During his recent Energy Development Summit, Governor Gary Herbert announced that the state, in partnership with Alberta, Canada-based Crescent Point Energy, will begin exploring “the vast oil and natural gas deposits of Utah’s Uinta Basin” in the eastern part of the state. The plans include a potential 4,000-well oil and gas exploration project in the region, which already includes 300 horizontally drilled wells. Governor Herbert hopes the exploratory activities will help decrease the Uinta Basin’s high unemployment rate by providing long-term energy sector jobs, but concurrently noted the importance of diversify the region’s economy. The federal Bureau of Land Management is currently reviewing the project, which includes nearly 160,000 acres across two Utah counties. Crescent Point Energy is planning to invest at least $50 million this year in the Uinta Basin, according to their CEO Scott Saxberg. "The basin has not yet been developed through horizontal means, which has been very successful in other states in opening up plays that people didn't realize were as good,” Mr. Saxberg said. Energy summit details massive project planned for Uinta BasinThe Deseret News

Federal and Regional

The Department of Energy (DOE) is considered awarding a $40 million grant to a University of Maine-led coalition that aspires to develop a wind turbine project off Monhegan Island, a less-than-a-mile rocky outpost ten miles from the mainland. Called the New England Aqua Ventus I, the deep-water wind farm is one of three projects up for consideration by the DOE, which hopes to develop more offshore wind capacity since 80% of the nation’s power demand occurs in coastal states. Aqua Ventus was previously passed over for investment by the DOE in 2014, and if it is awarded federal grant money this year, it will still need close to $100 million in private investment to be completed. The project’s turbine hubs are expected to reach 350 feet above the water while the blades will extend to 600 feet. “The Aqua Ventus project represents a tremendous opportunity for the state to capitalize on our advanced and highly skilled workforce paired with our clean energy ambitions,” said Jeremy Payne, executive director of the Maine Renewable Energy Association. “This project brings together the best of all three worlds: economic growth and innovation; emission-free electricity; and Maine-made secure energy.” UMaine wind project back in running for major federal grantThe Portland Press Herald

Energy Update, May 13

May 31, 2016

In the States

CO – The state’s Supreme Court recently ruled that local government bans and moratoriums on hydraulic fracturing, commonly known as fracking, conflict with state law. Proponents of local government action are now collecting signatures to place on the November ballot a constitutional amendment to restrict oil and gas drilling or to give local governments the authority to do so. One of the proposed constitutional amendments, which would supplant the state Supreme Court ruling if passed, would require minimum distances between wells and homes. “We're taking them as a serious threat to responsible oil and gas development in the state of Colorado," said Karen Crummy, a spokeswoman for an industry-backed group called Protecting Colorado's Environment, Economy and Energy Independence, which will campaign against the amendments. Colorado’s battle over regulating fracking shifts to ballotAP

GA – In collaboration with the Department of the Navy and state officials, Georgia Power announced it will build a new 31 megawatt (MW) alternating current solar generation facility at the Marine Corps Logistics Base in Albany, Georgia. The new project is the fifth of its kind by Georgia Power – the state’s largest utility and a subsidiary of Southern Company – to be built, maintained, and operated on a military base in the state. The $75 million facility will include nearly 140,000 ground-mounted photovoltaic (PV) panels across 150 acres and is expected to start generating electricity within the next year. "This project will generate solar energy as part of a diverse generation mix, while providing security for the base and a positive economic impact in the local community," said Kenny Coleman, senior vice president of marketing for Georgia Power. "The projects we are developing on our state's military bases are great examples of renewable energy growth being driven by collaboration and innovative partnerships." Georgia Power begins construction on new on-base solar facilityMidtown Patch

KS – Governor Sam Brownback recently signed legislation to suspend the state’s work on a plan to comply with federal regulations on carbon dioxide emissions from coal-fired power plants. The new law is scheduled to take effect on May 19th, making Kansas, which is among 27 states challenging the Obama administration’s new rules, the third state to shelve its compliance plans. Specifically, the new measure prohibits the state from “conducting studies or doing other work towards drafting a compliance plan until the U.S. Supreme Court’s stay [on the regulations] are lifted.”  Eileen Hawley, a spokeswoman for Governor Brownback, called the EPA's rules "an unprecedented expansion of its regulatory power" and "an affront to our constitutional order and the rights of our citizens." Kansas suspending work on limiting plans’ carbon emissionsPennEnergy/AP

NJ – At a hearing of the Senate Budget and Appropriations Committee, some lawmakers raised concerns about the cumulative $1.3 billion that was diverted from a state-created, taxpayer-supported clean energy fund to balance state budgets by Governor Chris Christie, a practice first initiated by former Governor Jon Corzine. The clean energy funds, which were originally intended to “reduce energy use and cut emissions contributing to global warming,” have been diverted by the executive branch in every budget since the 2008 state fiscal year. In next year’s budget, Governor Christie proposes to use $114.5 million from the fund to pay for energy costs at state buildings and for NJ Transit while another $3.7 million will pay for operational costs of the clean energy offices at both the state Department of Environmental Protection and the Board of Public Utilities. However, Board of Public Utilities President Richard Mroz, who appeared before a legislative committee, assured the legislators that “New Jersey has and continues to have a robust energy-efficiency program that is meeting our needs and reducing emissions.”  He also noted that the state has invested more than $2.4 billion in energy efficiency over the last 15 years. Over $1 billion meant for NJ clean energy fund diverted for other usesNJ Spotlight

Federal and Regional

A group of 68 United States Representatives, led by California Rep. Jared Huffman, sent a letter to Interior Secretary Sally Jewell asking the Department to exclude certain portions of Alaskan Arctic Ocean from all future oil and gas lease sales. The two areas noted by the Members of Congress include the Chukchi and Beaufort seas, which have already been approved for drilling by the Obama administration. The letter, which was signed by one Republican – Rep. Robert Dold of Illinois – and 67 Democratic lawmakers, noted that barring lease sales in the Alaskan Arctic Ocean will help the United States meet the Paris Agreement’s target of keeping global temperature increases below 2 degrees Celsius. According to the Interior Department, the area slated for exploration in the Chukchi Sea includes approximately 15 billion barrels of recoverable oil and 78 trillion cubic feet of recoverable natural gas while the Beaufort Sea could hold 8 billion barrels of oil and close to 28 trillion cubic feet of natural gas. "Ending oil and gas development in the Arctic would send a powerful international signal that the United States is committed to investing its resources in a climate safe, clean-energy future," the letter stated. Lawmakers want to end Arctic oil and gas leasingThe Washington Examiner

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