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Blog posts January 2014

Energy Update, January 17

In the States

AK – Governor Sean Parnell praised the recently signed commercial agreement between the Alaska Gasline Development Corporation, TransCanada Corporation, British Petroleum, ConocoPhillips, and ExxonMobil Corporation. The agreement, which the Governor called an “historic achievement,” details terms for a natural gas pipeline project. According to the agreement, the State’s equity share in the future pipeline will about approximately 20 to 25 percent. Legislative enabling authority is needed, however, for the State to engage in developing contract terms and the state legislature must also agree to the State’s estimated equity share. The involved parties estimate that project will cost about $45 billion to more than $65 billion for the roughly 800-mile pipeline. "Not only have all the necessary parties aligned around a single project, but we're moving forward with a project that's on Alaska's terms and in Alaskans' interests," said Governor Parnell. Agreement sets road map for gas line projectThe Anchorage Daily News

MA – Governor Deval Patrick announced $52 million in state funding to help Massachusetts towns to address climate change impacts. Approximately $40 million of the total funding will take the form of municipal grants and will be dedicated to making energy infrastructure “more resilient using clean energy technology.” Another $10 million will be dedicated to coastal infrastructure while the remaining $2 million will fund smaller energy-related projects. Fro example, the State is hiring a climatologist for the University of Massachusetts Amherst to work with the Northeast Climate Science Center. Other projects include natural disaster vulnerability assessments for state agencies and departments and funds to monitor potential for “diseases associated or attributed to climate-related factors.” The world's climate is changing,” said Governor Patrick, “and human activity is contributing to that change. Massachusetts needs to be ready." Gov. Patrick announces $52 million in state funding to combat effects of climate changeThe Boston Globe

NM – Governor Susana Martinez, state energy officials, and representatives from Cyrq Energy celebrated the opening of the State’s first utility-scale geothermal plant. The new Cyrq Energy geothermal plant, which is located in Hidalgo County, will provide electricity to PNM Resources, the State’s largest utility, and is projected to produce enough electricity to power up to 5,000 homes. Geothermal power is generated by the pumping of naturally hot water to the surface and then transferring such heat to spin turbines that in turn produce electricity. "We are proud of Cyrq's continuing commitment to New Mexico," said Governor Martinez. "This project is an excellent example of what we can accomplish when we work together to reduce duplicative and burdensome government red tape, so that businesses can create the jobs New Mexico families and communities need succeed." State’s first utility-scale geothermal plant heats upAlbuquerque Business First and Geothermal plant now operating in Hidalgo CountyThe San Francisco Chronicle

WV –  Following a massive toxic chemical oil spill that contaminated the State’s water supply, leaving more than 300,000 people without drinking or bathing water, State officials are slowly beginning to lift a ban on tap water, according to Governor Earl Ray Tomblin. The leak, which was discovered on January 9, emanated from a ruptured chemical tank that contained the coal-washing chemical 4-methylcyclohexane methanol, known as MCHM, which proceeded to spill into the Elk River. The Governor said the chemical company was to blame, calling the episode “unacceptable.” “We have made a lot of progress,” Governor Tomblin said, but I ask all West Virginians to continue to be patient as we work to safely restore service to the affected areas.” West Virginia puzzled, outraged over chemical leakThe Los Angeles Times and CDC: W. Va. water crisis ‘a dynamic and evolving event’The Charleston Gazette


Several Governors, including Mary Falling of Oklahoma and John Hickenlooper of Colorado, who respectively serve as chair and vice chair of the National Governors Association (NGA), recently met with President Barack Obama to discuss a range of issues, including states’ work on energy production and regulation. Governors Mike Beebe or Arkansas, Minnesota Governor Mark Dayton, Utah Governor Gary Herbert, and Wisconsin Governor Scott Walker also took part in the NGA meetings with the Obama administration. After their meeting, Governor Hickenlooper stated he told the President that States should take the lead in regulating energy production and that it would be easier for Governors to work across party lines on such issues as opposed to members of Congress. “We think we can get a bunch of states to create a national framework in regulation that would vary from region to region based on differences in geology or geography,” Governor Hickenlooper said. “But each governor is going to want to hold their state to the highest standard. I think every governor, without exception, wants to make it as least onerous…on business. You want to give your businesses every chance to succeed.” Gov. Hickenlooper to President Obama: Let governors come up with energy planThe Denver Post

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Energy Update, Jan. 3

In the States

MI – Governor Rick Snyder recently gave a briefing on energy policy, during which he stressed the need for the State to develop strategies that include more renewable energy and energy savings programs. Though the Governor did not set specific goals, the Governor said he hopes to help enact policies that bring “affordable, reliable energy” to Michigan through 2025. Several new reports were published citing the capability of the State’s utilities to reach a goal of 15% of energy from renewable sources by 2020 and 30% by 2035. Michigan currently requires utilities to obtain 10% of their energy from renewables, including wind and solar power, by 2015. Several organizations, including the League of Conservation Voters and the Natural Resources Defense Council, in addition to the State’s utilities like DTE Energy, commended the Governor for his remarks. Gov. Snyder on state's energy policy: 'We need affordable, reliable energy with no regrets'The Detroit Free Press

 NV – In partnership with NV Energy and Carson City Public Works, Governor Brian Sandoval’s Office of Energy (GOE) developed a new electric vehicle charging station in the State’s capitol. Funding for the project came in part from the GOE’s State Energy Program (SEP), which includes federal funds from the U.S. Department of Energy. The GOE’s grant’s are intended “to improve the reliability and affordability of energy supplies available to Nevada’s residents and businesses consistent with the need to protect the state’s environment and human health.” Carson City free charging station installedThe Nevada Appeal

 RI – Governor Lincoln Chafee is partnering with the State’s largest electric utility, National Grid, on a new effort to increase the State’s hydropower resources. National Grid is collaboratively working with the Governor and his staff on hydropower legislation for the General Assembly’s consideration. According to the U.S. Energy Information Administration, Rhode Island’s primary source of electric power is natural gas, and even though the State consumes less energy per resident than any other state, Rhode Island’s electric expenses are higher than the national average. "We have the potential to be the low-cost, green energy capital of America," said Governor Chafee. National Grid working with Chafee on hydropowerWPRI News


Six Midwestern Governors sent a letter supporting the Renewable Fuel Standard (RFS) to President Barack Obama, Environmental Protection Agency (EPA) Administrator Gina McCarthy, and Agriculture Secretary Tom Vilsack. The letter was signed by Governors Terry Branstad of Iowa, Sam Brownback of Kansas, Jack Dalrymple of North Dakota, Mark Dayton of Minnesota, Dennis Daugaard of South Dakota, and Dave Heineman of Nebraska. The Obama administration, through the EPA’s regulatory authority, has proposed lowering the RFS by reducing the amount of renewable fuels that must be blended into the nation’s fuel supply by 3 billion gallons. The letter highlights current ethanol and other biodiesel production levels, hoping that the EPA will actually increase the biodiesel volume in the fuel supply in 2014. The Governors also believe that decreasing the RFS could negatively impact farmers, the cost of corn, and the overall American economy. Branstad, five other Governors lobby President for higher ethanol mandateThe Des Moines Register

Twelve Governors penned an open letter to national energy policy leaders urging them to leave regulatory programs related to the exploration and production of oil and gas, including oversight of hydraulic fracturing, in the hands of States, which the letter asserts are “the labora­tories of effective regulatory development.” The letter is part of a new initiative called States First, which is a partnership of the Interstate Oil and Gas Compact Commission (IOGCC) and the Groundwater Protection Council (GWPC). The letter was signed by Governors Phil Bryant of Mississippi, who chairs the IOGCC, Robert Bentley of Alabama, Steve Beshear of Kentucky, Steve Bullock of Montana, Tom Corbett of Pennsylvania, Jack Dalrymple of North Dakota, Mary Fallin of Oklahoma, Gary Herbert of Utah, John Hickenlooper of Colorado, Sean Parnell of Alaska, Rick Perry of Texas, and Brian Sandoval of Nevada. The letter can be found here.


The U.S. Senate’s Energy and Natural Resources Committee late last year approved a bipartisan bill that seeks to strengthen collaboration between the United States and Israel on energy issues. Titled the United States-Israel Energy Cooperation Enhancement Bill, Senators Mary Landrieu of Louisiana, Ron Wyden of Oregon, and Lisa Murkowski of Alaska believe the legislation will lead to partnerships between the two countries on national gas and alternative fuels. The bill also called for the cooperation of the Department of Energy’s (DOE) national laboratories and the Israeli government. “Today’s Senate vote is a huge step forward in our work to enhance the partnership between Israel and the U.S. on energy production,” Senator Landrieu said, following the committee’s decision to approve the bill. US Senate committee passes bipartisan US-Israel energy billThe Jerusalem Post

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Energy Update, Dec. 13

In the States

OH – Following Governor John Kasich’s earlier request in his two-year budget, Ohio House leaders have proposed a new severance tax bill, House Bill 375, that would collect 1 percent of all new proceeds from each horizontally drilled oil and gas shale well for the first five years a well is in production. Starting in Year 6, the severance tax would increase to 2 percent and would decrease again when well production declines to lower levels. State officials predict the legislation could raise nearly $2 billion in new revenue over the next ten years. After first appropriating money for the State’s Department of Natural Resources’ division of oil and gas resource management, the money collected by the severance tax will be used to reduce state income taxes and to find and cap abandoned oil and gas wells. The State currently collects only 20 cents per barrel of oil while the tax on natural gas is 3 cents per thousand cubic feet, thereby giving the State around $2.8 million in oil and gas severance taxes in fiscal year 2013. Proposed tax hike on oil and gas drilling would provide industry stability but leaves critics wanting moreThe Cleveland Plain Dealer 

WA – Governor Jay Inslee joined officials from the University of Washington to launch the university’s new Clean Energy Institute. The institute was created and will be supported with $6 million appropriated by the State’s legislature for the next two years. The institute will focus on renewable energy, including nanoscale molecules for solar cells, smart-grid, and electrical storage technology. The Clean Energy Institute will also examine the effects of new clean energy technology, for example, the use of hydropower and its effects on fish populations. Clean energy “is going to make tons of money and create thousands of jobs,” said Governor Inslee, and Washington is in an excellent position to benefit from those innovations. UW flips the switch on new Clean Energy InstituteThe Seattle Times 

WY – Governor Matt Mead announced his plan to cap more than 1,200 abandoned oil and gas wells within the next four years. The Governor’s plan, which would cost anywhere from $8 to $32 million, seeks to close at least 305 orphaned wells each of the four years. Governor Mead’s plan also calls for the development of plugging standards and a program managed to oversee the process. “Energy production and environmental stewardship are inextricably connected," said Governor Mead. "Plugging wells and reclaiming the land are expensive endeavors, but they are necessary to minimize disturbance to landowners and to safeguard our land, water, and wildlife." Wyoming Gov. Matt Mead announced plan to plug 1,200 abandoned oil and gas wellsThe Casper Star Tribune and Governor releases plan for plugging abandoned oil and gas wellsWyoming Public Media


The Governors from the New England region have signed an agreement to expand gas and electric transmission projects. Called the Regional Energy Infrastructure Initiative, the cooperative pact was signed Thursday by Governors Paul LePage of Maine, Dannel Malloy of Connecticut, Deval Patrick of Massachusetts, Maggie Hassan of New Hampshire, Lincoln Chafee of Rhode Island, and Peter Shumlin of Vermont. The signed agreement directs each State’s energy and environment agencies to collaboratively develop a multi-state strategy to meet the States’ collective energy objectives. According to Patrick Woodcock, director of Governor LePage’s energy office, the agreement represents the “first step in pursuing a regional strategy” that could also lead to alignment with Canadian energy infrastructure goals and projects. Recently, several of the States have been exploring purchasing hydropower from Canadian sources. "This is an economically and environmentally important collaboration," said Governor Patrick. "By expanding opportunities for large-scale hydro, wind and other renewable energy sources, we are putting thousands of our residents to work and creating a healthier region for the next generation." All six New England Governors commit to joint energy infrastructure agendaThe Bangor Daily News and New England governors forge energy pactThe Connecticut Post


Tom Vilsack, the Secretary of Agriculture, and Ray Mabus, the Secretary of the Navy, announced the creation of a new program to power Navy ships with advanced biofuels. Titled the Farm to Fleet initiative, the program seeks to lower the nation’s reliance on foreign oil while helping to support American farmers. "The Navy's intensifying efforts to use advanced, homegrown fuels to power our military benefits both America's national security and our rural communities," said Secretary Vilsack, a former Governor of Iowa. "Not only will production of these fuels create jobs in rural America, they're cost effective for our military, which is the biggest consumer of petroleum in the nation.” The program will begin with regular procurement practices and solicitations next year, and the first deliveries of the new fuel will take place in mid-2015. Agriculture, Navy Secretaries promote U.S. military energy independence with “Farm-to-Fleet”KTIC

 The Department of Energy (DOE) is offering up to $8 billion in loan guarantees for fossil-energy projects that use new technology to lessen carbon emissions. The funds, which were appropriated in the 2005 Energy Policy Act, are targeted towards extraction and generation projects involving oil, gas, and coal. According to Peter Davidson, executive director of the loan program office at DOE, this is the first new solicitation in DOE’s loan guarantee program in almost three years. DOE to offer $8 billion in clean fossil-fuel project loan guaranteesPlatts


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