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Blog posts January 2013

Energy Update, Jan. 25

In the States

MD – Governor Martin O’Malley is preparing to introduce a bill in the state legislature to incentivize the development of several offshore wind farms, though a similar proposal has failed the previous two years. The measure, which offers developers subsidies to build turbines and maintains a fixed price for the power they produce, would require the State’s electricity suppliers to provide as much as 2.5 percent of their power from offshore wind turbines by 2017. The federal Bureau of Ocean Energy Management is expected to invite bids for offshore leases in a 124-square mile section of the Outer Continental Shelf off Maryland later this year to expand wind power production, further prompting the reintroduction of the Governor’s legislation. “The time to act is now,” said Governor O’Malley, who also acknowledged it may take several years before the turbines are completed, even if his bill passes the legislature. O’Malley readies new offshore wind bid and O’Malley offshore wind bill gets fast startThe Baltimore Sun

 NE – Governor Dave Heineman, in a letter to President Barack Obama and Secretary of State Hillary Clinton, announced his approval of a new route for the Keystone XL oil pipeline that will transverse his state. The 1,700 mile pipeline, a project that supporters argue will increase North American energy independence, would bring Canadian carbon-heavy crude oil from Canada’s tar sands region to refineries in Texas. According to the Governor, if completed, the pipeline project would produce $418.1 million in economic benefits for the state, several million dollars in additional state tax revenue, and thousands of new jobs. The $7 billion project requires review by both the State Department and President Obama and it may take months for a final decision. Nebraska governors OKs Keystone XL route through stateThe Bismarck Tribune

 WV – Governor Earl Ray Tomblin, joined by officials from IGS Energy CNG Services and state energy officials, announced the construction of four natural gas fueling stations along the Interstate Route 79 corridor in Pennsylvania and West Virginia. The $10 million project will include stations in the towns of Bridgeport, Charleston, and Jane Lew. The corridor’s construction is set to take place during the first quarter of this year, and is planned to support all types of vehicles that operate on compressed natural gas (CNG). IGS Energy CNG Services stated that it chose West Virginia as the location for its fueling stations because of Governor Tomblin and the state legislature’s decision to incentivize the development of the CNG industry in the state. “West Virginia is one step closer to lessening our reliance on foreign fuel sources,” said Governor Tomblin. IGS Energy CNG Services to construct compresses natural gas fueling corridorThe Hampshire Review


New global investment in clean energy dropped 11% in 2012, according to a Bloomberg New Energy Finance report. Though total investment dipped to $269 billion, down from $302 billion in 2011, that figure still represents the second-highest year for clean energy investment. The report states investment was “weighed down by regulatory uncertainty and policy changes in big markets such as the US, India, Spain, and Italy.” Strong clean energy performers included countries like China, which saw a record $67.7 billion outlay, and South Africa, which saw investments increase by $5.5 billion. Similarly, Japan also increased investment and refocused its efforts on renewable power sources in the wake of the Fukushima nuclear disaster. Bloomberg states solar energy again led in terms of overall clean energy investment last year, with wind, energy-smart technologies such as smart grids and electric vehicles, biomass, and waste-to-energy following behind. Almost all sectors, with the exception of small hydro power or projects less than 50 megawatts, showed negative investment growth in comparison to 2011 figures. New investment in clean energy fell 11% in 2012Bloomberg

 In his second Inaugural Address, President Barack Obama addressed several energy topics, including renewable energy production and climate change, though the latter received little-to-no attention during the presidential campaign. Some policy experts predict the Environmental Protection Agency (EPA) will play a higher profile role than during the President’s first term, pursuing restrictions on emissions from coal-burning plants, while others contend the administration will continue to elevate alternative forms of energy, including natural gas. “We will respond to the threat of climate change, knowing that failure to do so would betray our children and future generations,” the President said. “…The path toward sustainable energy sources will be long and sometimes difficult, but America cannot resist this transition; we must lead it.” Speech gives climate goals center stageThe New York Times

 The House Energy and Commerce Committee passed legislation this week to help facilitate the development of small hydropower projects. Co-sponsored by Reps. Cathy McMorris Rodgers (R-Wash) and Diana DeGette (D-Colo.), the bill directs the Federal Energy Regulatory Commission (FERC) to study and implement a streamlined, two-year permitting process for hydropower projects. The legislation, which mirrors a bill passed by the full House last July, specifically deals with projects at non-powered dams and would benefit hydropower-based energy storage technology, which stores energy developed from irregular sources that can be released by utilities during periods of high electrical demand. According to the National Hydropower Association (NHA), the bill has the potential to add almost 60,000 megawatts of hydropower by 2025. Bipartisan support moves hydropower bill – The Hill

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Energy Update, Jan. 11

In the States

AL – Governor Robert Bentley will serve as the chairman of the Interstate Oil and Gas Compact Commission (IOGCC), a multi-state government agency that promotes the conservation and efficient development of domestic oil and natural gas resources. The first Alabama governor to chair the IOGCC, Governor Bentley plans to focus on oil and gas inspector certification, bettering communication among member states, and the sharing of best practices on regulatory and technical issues. “By working with other states, we can conserve and develop oil and gas resources through safe and environmentally-sound operations,” Governor Bentley said. Governor Bentley begins chairmanship of IOGCCThe Cherokee County Herald 

VA – Governor Bob McDonnell is proposing to eliminate the State’s tax on gasoline purchases as part of a transportation funding plan. The current 17.5 cents per gallon tax on gasoline would be replaced with a 0.8% increase in Virginia’s sales tax to offset the revenue lost by eliminating the gas tax and provide additional transportation funding. Governor McDonnell estimates his proposal will generate at least $3.1 billion over five years for transportation projects in the State. “The gas tax is a stagnant revenue source, and no changes to it will provide a reliable growth mechanism for transportation in the state,” said Governor McDonnell. Virginia Gov. Bob McDonnell proposes eliminating state’s gas taxThe Hill

 Governors across the country are giving their annual State of the State address, a speech customarily given before a joint session of the state legislature in which a Governor highlights his or her executive agenda and priorities for the upcoming legislative session. Governor Cuomo of New York announced his intention to coordinate his State’s energy portfolio through the appointment of a Cabinet-level “energy czar,” an investment in an electric car network, and the expansion of solar panel installations for homes and businesses. In Wyoming, Governor Matt Mead is urging state lawmakers to increase the state fuel tax and to redirect roughly $130 million in annual state energy revenues into a state rainy day fund. North Dakota Governor Jack Dalrymple emphasized the state’s budget surplus, due in part to its increased barrel-per-day oil and natural gas production. The National Governors Associations’ State of the States Address, the first ever held, was given by Delaware Governor Jack Markell, the NGA Chair, and Vice Chair Governor Mary Fallin of Oklahoma. It touched upon the topics of energy independence and the continued conversion of state automobile fleets to natural gas vehicles.

National News

As part of the recent fiscal cliff package, Congress extended the wind production tax credit (PTC) through 2013. The PTC renewal allows wind energy developers to choose between a production tax credit of 2.2 cents per kilowatt-hour for the first ten years of production or an investment tax credit, which is a payment of 30 percent of the construction costs. Further, the law allows any project that has begun construction by the end of 2013 to qualify for the PTC. The extension also now applies to several other energy sources, including geothermal and biomass. The fiscal cliff package also included several other energy tax provisions, including an investment tax credits for offshore wind development and energy efficient homes and appliances. The wind industry gets to draw another breathThe New York Times

 After four years at the helm of the Environmental Protection Agency (EPA), Lisa Jackson has resigned. Her tenure at the EPA followed six years leading the New Jersey Department of Environmental Protection and a brief stint as the Chief of Staff to former New Jersey Governor Jon Corzine. Under Jackson’s administration, the EPA ruled that carbon dioxide and other gases that contribute to global warming meet the definition of pollutants under the Clean Air Act and also promulgated new vehicle fuel efficiency standards. Emissions standards for mercury, arsenic, and numerous other airborne toxins were also finalized during Jackson’s term. E.P.A. chief set to leave; term fell shy of early hopeThe New York Times and EPA Administrator Lisa Jackson announces resignationTime

 Senator Lisa Murkowski (R-Alaska), the ranking member of the Senate Energy and Natural Resources Committee, is working on a bill to increase energy-related revenue sharing between the federal government and states to include fossil fuels and renewable energy sources, both offshore and on federal property. According to a draft version of the bill, Sen. Murkowski’s plan would set revenue sharing at 27.5% for new states that create wind, oil, natural gas, and other energy production offshore with another 10% available only for research and development, efficiency, and conservation. The combined 37.5% in the draft legislation is the current total percentage of cost sharing given only to Gulf States. The bill would also give states 50% in guaranteed revenue sharing for oil and gas discovered on federal lands within their borders. Lisa Murkowski pens revenue-sharing expansion billPolitico

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Energy Update, Dec.28

In the States

NY – Governor Andrew Cuomo’s administration announced that the State will provide $250 million in funding for renewable energy projects next year, as recommended by the Governor’s Energy Highway Blueprint. With a focus on electric generation, prospective projects include several clean energy sources such as hydroelectricity, wind, solar, and biomass and will attempt to upgrade the State’s energy infrastructure and further encourage the development of renewable energy generation projects. Successful applicants will be notified next summer. “As New York state looks to upgrade and improve its energy infrastructure, renewable energy will play an even greater role in providing power that is more reliable, efficient and environmentally sustainable,” Governor Cuomo said. New York renewable energy projects receive $250 million boostThe Oneida Daily Dispatch

 OR – After months of public comment, Governor John Kitzhaber released the final version of his 10-year Energy Action Plan, which strives to improve energy efficiency while advancing clean energy development. According to state energy officials, the plan will help to keep the more than $14 billion that Oregon spends on energy within its borders. The plan, which includes the creation of a new State Building Innovation Lab that will conduct energy audits, sets new energy conservation goals and seeks to remove burdensome financial and regulatory barriers. "Energy is the issue of our time, both globally and here in Oregon," Kitzhaber said. Gov. John Kitzhaber released 10-year energy action planThe Oregonian and Gov. Kitzhaber releases final 10-year energy plan for OregonPortland Business Journal

 WY – Governor Matt Mead, along with several state and local officials, dedicated a carbon dioxide pipeline in western Wyoming. The 232-mile pipeline, which will be operated by Texas-based Denbury Resources, will transport carbon dioxide to several oil fields across Wyoming and Montana. The carbon dioxide will be used in oil field flooding, or the process by which gas is injected into the ground, thereby releasing trapped oil deposits. The pipeline is projected to increase the life span of numerous oil fields and is the first phase of a larger plan by Denbury to build carbon dioxide infrastructure throughout the Rocky Mountains. Wyoming, Montana carbon dioxide pipeline opens Jan. 1The Billings Gazette

 National News

Congressional Republicans, citing concerns from AAA, automakers, and the oil industry, will call for a hearing on new the renewable fuel standard (RFS) during the next Congress, according to staff of on the House Energy and Commerce Committee. The  fuel standard now mandates refiners to mix 36 billion gallons of ethanol into traditional fuel sources by 2022, thereby rendering higher ethanol-concentrated fuel. Critics of the RFS and E15, a fuel blend that contains 15 percent ethanol compared to the regular 10 percent blend, believe the new fuel rules and blends will damage cars and will eventually negatively impact consumers. “Hearings on the RFS are not necessary,” said Renewable Fuels Association CEO Bob Dinneen, “but should they proceed, we believe the hearings would shine a spotlight on the success of the RFS in terms of energy independence, job creation, and environmental benefits.” House Republicans plan to put fuel standard on trial in next CongressThe Hill

 The U.S. Department of Commerce increased import duties or tariffs on wind tower products made in China and Vietnam, which account for 25 percent of the total U.S. market combined. The final punitive rate, which includes both anti-dumping and countervailing duties, sets combined tariffs as high as 105.4 percent on utility-scale wind towers. The Commerce Department believes the new rates will combat government subsidies and the practice of dumping, or the selling of goods in the U.S. below production costs. Though the new tariffs need approval from the independent U.S. International Trade Commission and are at a lower rate than initially expected, domestic manufacturers are hoping the duties will allow them to compete in this market. U.S. boosts import duties on Chinese wind-energy firmsBloomberg

 The Obama administration has announced its plan to allow oil and gas drilling in the National Petroleum Reserve in Alaska (NPR-A), a 23-million acre stretch of public land on the State’s North Slope. Interior Secretary Ken Salazar said the plan opens 11.8 million acres for development in an area believed to hold 549 million barrels of oil and 8.6 trillion cubic feet of natural gas. The plan prevents oil and gas extraction on the remaining parts of the NPR-A. According to the Secretary, the plan allows for pipeline construction to transport oil and gas from the Chukchi and Beaufort seas through the NPR-A. U.S. Representative Don Young (R-Alaska), who would like to see more of the NPR-A opened to oil and gas exploration, said the plan “does nothing more than cave to environmental special interests and unnecessarily restricts access to rich oil and natural gas resources within a petroleum reserve.” Alaska oil plans draw fire, praiseUnited Press International

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