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Blog posts December 2014

Energy Update, Dec. 19

In the States

NY – Following the release of a multi-year study of the public health implications of hydraulic fracturing, Governor Andrew Cuomo announced his administration will move to ban the practice in New York State. Hydraulic fracturing, commonly known as fracking, is the process by which fluids are injected into wellbores to help release natural gas and oil. Dr. Howard Zucker, the state’s acting health commissioner, said the study found “significant public health risks” associated with fracking, and during a Governor’s cabinet meeting, Dr. Zucker “listed concerns about water contamination and air pollution.” Governor Cuomo, who received much praise from environmental groups for his decision, said “I’ve never had anyone say to me, ‘I believe fracking is great.’ Not a single person in those (Southern Tier) communities. What I get is, ‘I have no alternative but fracking.’” Citing health risks, Cuomo bans fracking in New York stateThe New York Times and Cuomo administration rules against frackingThe Washington Post

WA – Governor Jay Inslee recently released his plan to cut the state’s carbon emissions by creating a cap-and-trade system, which would set a price on the right to emit carbon and other greenhouse gases. The proposal, which is called the Carbon Pollution Accountability Act, would apply to companies that “emit more than 25,000 metric tons of carbon emissions per year,” which according to the Governor’s office, “would cover about 85% of the state’s total greenhouse gases.” Early projections estimate the state would raise nearly one billion dollars, if the program was implemented, to support transportation projects. The Governor’s plan also includes tax breaks for electric and zero-emission automobiles and investments in renewable energy sources. Opponents of the Governor’s plan called his proposal a “massive energy tax on the people of Washington State.” Washington governor proposes billion-dollar carbon emissions cap-and-trade planThe Washington Post and Inslee targets polluters with billion-dollar cap-and-trade planThe Seattle Times

Federal and Regional

Interior Secretary Sally Jewel recently announced the appointment of Abigail Ross Hopper, the director of the Maryland Energy Administration, to lead the Bureau of Ocean Energy Management. Ms. Hopper is expected to assume the position on January 5th. The Bureau oversees energy development, namely natural gas, oil, renewables, and other mineral resources, on the Outer Continental Shelf. Republican Senator David Vitter and Senator-elect Bill Cassidy, both of Louisiana, voiced their concerns about Ms. Hopper’s appointment, noting that she’s “too focused on renewable energy and lacks experience with oil and gas.” Senator Vitter said “There is so much untapped potential off our shores, and I fear that Ms. Hopper's far-left environmental background will slow down offshore production and further limit access to fossil resources - hurting jobs and businesses.” Interior Secretary Jewell names new chief for Outer Continental Shelf energyThe Times-Picayune

Sixty-seven organizations signed a letter, which was spearheaded by the Sierra Club, to the Governors and Governors-elect of the Northeast and Mid-Atlantic states urging them to support the development and adoption of electric vehicles (EVs). The letter, which was signed by a range of environmental advocacy and renewable energy groups, as well as some energy companies including Con Edison, said electric vehicles could “save a consumer thousands of dollars in fuel costs over the life of the vehicle,” while also noting that EVs have significant climate benefits, such as “little to no tailpipe emissions.” The letter also encourages the Governors and Governors-elect to establish a high-level EV task force, provide financial and other incentives for EVs, and educate consumers, businesses, and other stakeholders about EVs’ benefits.

The Environmental Protection Agency (EPA) announced it will hold off on a decision to pursue new methane emissions rules for the oil and gas industry until 2015. The Obama administration had previously set a deadline of December 21st to choose a strategy to reduce methane pollution. Several Democratic lawmakers have asked the EPA to speed up their decision process on future rules for methane, which is considered much more damaging than carbon dioxide over a 20-year timeframe. Methane, according to the EPA, is most often released from leaky or inefficient oil and gas industry equipment. EPA punts decision on methane regsThe Hill and Oil and gas industry faces its methane problemNational Geographic

The Department of Energy (DOE) recently issued solicitations for the Advanced Nuclear Energy Projects loan guarantee, which will offer up to $12.5 billion for nuclear energy projects. The solicitation will support four technological areas: advanced nuclear reactors, small modular reactors, upgrades for existing facilities, and front-end projects like uranium enrichment and conversion. The full solicitation is can be found here.

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Energy Update, Dec. 5

In the States

AR – Following a review that it had not met “specified employment goals,” LM Wind Power has repaid the State of Arkansas more than $3 million that it had received as part of a larger incentives package to build a wind turbine production plant near Little Rock. The company received almost $9 million from the Governor’s Quick Action Closing Fund. Those funds were contingent on meeting an employment goal of more than 1,000 employees in Little Rock by fall 2014. The State’s Economic Development Commission (AEDC), according to the Danish manufacturer, has recouped the funds, which took into account employment and payroll estimates. "Although LM is not operating at the employment level the company originally announced in 2007, AEDC is encouraged the company still employs more than 500 people in a volatile wind energy market," said a company representative. AEDC: LM Wind Power paid back $3.4M in incentivesArkansas Business

MD – Outgoing Governor Martin O’Malley’s administration said it will release proposed rules next month on hydraulic fracturing, commonly known as fracking, in western Maryland. Fracking is the process by which fluids are injected into wellbores to help release natural gas and oil. Governor O’Malley, who previously ordered a study be completed on the risks and impacts of fracking, believes it can be done safely and will benefit Maryland economically. Governor-elect Larry Hogan will take office in January and said he will review the O’Malley administration’s rules and decide on whether to proceed with fracking immediately. "We're committed to ensuring that Marylanders have access to the economic opportunities associated with fracking," Governor O'Malley said, "while also putting the most complete practices into place to ensure the highest level of protection for Maryland residents." O’Malley administration sets out path to fracking in MDThe Baltimore Sun and Maryland to begin drafting fracking regulationsSouthern Maryland Newspapers Online

UT – Working to decrease air pollution and to improve public health, Governor Gary Herbert is proposing a ban on the use of wood-burning devices. Recently, the Utah Air Quality Board voted to explore the Governor’s idea, which was met with skepticism from some private sector companies and strong support from clean air activists. State regulators believe a total ban on wood-burning would be easier to enforce as opposed to a partial or temporary ban. The Governor’s office believes a total ban would “yield big air quality benefits” and “emphasize public health over ambiance.” Utah wholesaler John Mortensen, who owns Energy Distribution Systems and disagrees with the Governor’s proposal, said “it would be good to encourage upgrading to cleaner technology, allowing some carrot instead of all stick to reduce emissions related to wood burning.” Gov. Gary Herbert proposes wood-burning ban in UtahThe Salt Lake Tribune

Federal and Regional

 The current and former chairmen and vice chairmen of the Governors’ Wind Energy Coalition, a bipartisan group of governors from 23 states, recently sent a letter to House and Senate leadership urging Congress to approve a multi-year extension of the wind energy production tax credit (PTC) and investment tax credit (ITC). The letter cites several state examples as important “achievements directly attributable to the PTC,” including in one state where, for example, an estimated $2 billion was added to the state’s economy thanks to the construction of a tax credit-supported wind farm. The Governors’ letter also asks Congress to consider the role of the PTC and ITC in furthering the nation’s off-shore wind energy goals and contends that energy prices have decreased over the last few years in states that produced at least seven percent of their energy from wind power. “While we recognize there is support in Congress for phasing down these various tax incentives for all sectors in a comprehensive tax reform package, until we do, we must allow the nation’s wind industry to compete with other energy sources that also receive federal support.”

The Department of the Interior announced it had distributed more than $13 billion in 2014 to several government entities resulting from royalties and other fees collected thanks to energy production on federal and Native American lands. The Department, which distributes revenues each month, said “revenue generated from developing public energy resources that belong to all Americans helps fund critical investments in communities across the United States and creates American jobs, fosters land and water conservation efforts, improves critical infrastructure, and supports education.” Royalties paid to Native American tribes totaled more than $1 billion, primarily due to the increased production on a North Dakota reservation. Tribes, unlike state and local governments, receive all revenues resulting from energy production on their land while other local or state agencies receive a certain percentage. Feds distribute revenues from energy production on federal, Indian landThe Hill


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