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Blog posts March 2016

Energy Update, March 25

In the States

AK – Governor Bill Walker will seek the state legislature’s approval to sell a significant part of the state’s royalty crude oil. The current plan would sell oil of up to 25,000 barrels per day to Tesoro Alaska, one of the country’s largest refining companies, under a five year contract. The state Department of Natural Resources (DNR) recently concluded that the sale, which is projected to generate about $45 to $56 million in revenue, is in the state’s best interest. The DNR’s decision follows a favorable recommendation to the state legislature from the Alaska Royalty Oil and Gas Development Board, which oversees proposed royalty sales. Alaska is currently facing a $3.8 billion budget deficit,  largely attributable to low oil and gas prices. Walker administration plans to sell much of state’s royalty oil to TesoroThe Alaska Dispatch News

MA – Governor Charlie Baker said he would support efforts by the General Court, the state’s legislature, to pass an omnibus energy package that helps “to spur the development of offshore wind.” The Governor, in his message to legislators, also reiterated his primary focus of allowing the state’s utilities to solicit up to 2,400 megawatts of Canadian hydroelectricity, which the Governor notes will help the state meet its carbon emissions targets. Concurrent with the Governor’s announcement, three former secretaries of energy and environmental affairs, all under former Governor Deval Patrick, announced their support of Governor Baker’s plans. The state House of Representatives is expected to begin debate on a comprehensive energy bill in April. Baker amenable to offshore windThe Commonwealth and Former Patrick secretaries have Baker’s back on hydropower pushWWLP 22

WY – Governor Matt Mead published his administration’s updated statewide energy strategy. The Governor’s new plan, which builds upon previously-issued goals in 2013, seeks to “make coal a more viable resource and [includes] efforts to grow the state’s wind-energy sector.” Comparing the original and updated energy strategies, Governor Mead noted that 29 of the 47 energy-, conservation-, and economic development-focused initiatives listed in the initial plan were completed, including promoting liquefied natural gas and updating requirements around oil and gas operations. The 2016 strategy features 11 new initiatives, including completing an inventory of state and federal cooperative agreements, reviewing state oil and gas environmental regulations, and executing timely energy audits to improve efficiency. “Wyoming has a track record of excellence in energy development and stewardship,” said Governor Mead. “The energy strategy provides a systematic approach. The strategy is dynamic and this update continues this important work.” Mead unveils a new energy strategy to reflect the timesThe Casper Star Tribune

Federal and Regional

The Obama administration released a revised proposed offshore leasing plan that “eliminates the administration’s initial plan to auction off drilling rights in as many as 104 million acres of the mid- and south-Atlantic in 2021.” The modified program, however, allows for the selling of oil and gas leases in the Gulf of Mexico and in the Arctic waters, namely in the Chukchi and Beaufort seas. The policy change followed months of lobbying by both environmentalists and coastal communities in favor of the alteration and those opposed, including the oil industry and some Governors, principally Nathan Deal of Georgia, Nikki Haley of South Carolina, and Terry McAuliffe of Virginia. The revised proposal, which does not affect the oil industry’s existing drilling rights, is subject to public comment, which may further impact the final leasing plan that is expected to be completed by the end of this year. “This is a balanced proposal that protects sensitive resources and supports safe and responsible development of the nation’s domestic energy resources to create jobs and reduce our dependence on foreign oil,” said Interior Secretary Sally Jewell. Obama bars Atlantic offshore oil drilling in policy reversalBloomberg

A bipartisan group of 19 Senators wrote to Environmental Protection Agency (EPA) Administrator Gina McCarthy, urging her to set higher blending targets under the national Renewable Fuel Standard (RFS) in 2017. The EPA retroactively set blending targets for the RFS for 2014, 2015, and 2016 last November and is expected to issue the 2017 targets in the coming weeks. According to the Senators, the EPA’s setting of low blending targets in previous years, primarily due to concerns that higher percentages could cause vehicle issues and the lack of distribution infrastructure, does not follow congressional intent. “We need a strong RFS, and we need more biofuels. “We expect that you get the program ‘back on track’,” wrote the Senators, “and we look forward to seeing a proposed rule released on time that removes the distribution waiver and re-establishes the United States as a leader in the biofuel sector.” Senators want higher blending targets for RFS in 2017Morning Consult

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Energy Update, March 11

In the States

ME – Governor Paul LePage announced his opposition to a proposal to expand solar power capacity in Maine. The proposal, which was supported by solar power companies, the state’s Office of the Public Advocate, and utilities Central Maine Power and Emera Maine, seeks to “grow solar capacity in Maine from about 28 megawatts to 250 megawatts in five years, or two percent of the state’s power needs.” According to supporters, the plan would have created an estimated 800 jobs and allowed net metering through 2029 by encouraging the growth of community, industrial, and commercial solar farms. “We’re not opposed to solar,” said Lisa Smith, a senior planner in the Governor’s energy office. “But we’re looking out for the cost to all ratepayers. We were in favor of a mechanism that went in a market-based direction, but this isn’t it.” LePage opposes compromise to rapidly expand solar powerThe Portland Press Herald

NH – The House of Representatives supported a bill to raise the cap on the state’s net metering program, which permits solar power-generating residents and businesses to sell their excess energy into the greater electric grid. The current cap on reimbursement for residents is set at 50 megawatts (MW) while the recently-passed measure would double the cap to 100MW. The state Senate, earlier in the current session, backed a measure to increase the cap to 75MW. Governor Maggie Hassan supports lifting the cap to 100MW, a step she called a “critical part of New Hampshire’s move toward a clean energy economy.” NH House votes to raise cap on net meteringNHPR

OR – The Legislative Assembly approved a measure to exclude coal from the state’s energy supply by 2030 and to double mandates for renewable energy by 2040. Specifically, the bill requires the state’s utilities – Portland General Electric (PGE) and Pacific Power – to follow timelines to remove coal-fired electricity generation while also mandating a 50% renewable energy standard, up from a 25% standard by 2025 that was set in 2007. PGE, which serves more than 900,000 customers across the state, projects the change will increase costs for the average consumer by about 1.5% annually between 2017 and 2040. Known as the Clean Electricity and Coal Transition Plan, the legislation received bipartisan support in both the House and the Senate and now heads to Governor Kate Brown’s desk for her signature. Governor Brown indicated earlier that she would support the legislation, noting she believes it "equips Oregon with a bold and progressive path towards the energy resource mix of the future." Oregon Senate passes bill to scrap coal power by 2030Associated Press/KTVZ

TX – Net Power, a collaboration between Exelon Corporation, CB&I, and 8 Rivers Capital, broke ground on a “first-of-its-kind” natural gas power plant near Houston. The 50-megawatt pilot project, which is projected to be operational in 2017, is unique because it will send carbon dioxide emitted from the power plant into a sequestration pipeline that will allow the gas to be stored, used for oil recovery, or employed in industrial practices. The $140 billion pilot plant will utilize the Allam Cycle, a thermodynamic cycle technology that generates power from fossil fuels by burning natural gas with oxygen and high-pressure carbon dioxide. “Net Power is the first technology that allows policy and economics to work together, instead of against each other, to ensure the world meets our climate targets,” said Net Power CEO Bill Brown. Net Power beaks ground on demonstration plantsYahoo News

UT – The State Legislature passed legislation to invest at least $50 million for a deep-water, coal shipping facility at the Port of Oakland, California. Supporters believe the bill, which now heads to Governor Gary Herbert’s desk for his consideration, will assist Utah in selling coal and other products overseas. The bill transfers sales-tax revenue funds along with federal mineral royalties to a new infrastructure fund to be controlled by the state’s Permanent Community Impact Board. The Board traditionally has loaned or granted funds to Utah’s rural coal counties to pay for local developments and projects. Before any money can be spent, the new facility requires the approval of Governor Jerry Brown of California and the Oakland City Council. Utah Legislature Oks $53 million case swap to fund Oakland coal portThe Salt Lake Tribune

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Energy Update, February 26

In the States

MD – The state Senate recently approved a measure by a 38 to 8 vote to require the state to cut its greenhouse gas emission by 40% below 2006 levels by 2030. The previous goal, which was set by the state in 2010, was to reduce emissions by 25% by 2020. The bill reauthorizes and expands the Greenhouse Gas Reduction Act’s requirements, which will expire at the end of 2016 if the General Assembly does not pass the legislation. The bill now heads to the Maryland House of Delegates for its consideration. “This bill is not only important, it’s urgent,” said state Senator Jamie Raskin after voting in favor of the measure. The new goal stems from the state’s Climate Chance Commission, which includes state legislators, private businesses, and state agency secretaries. Maryland Senate Oks new goal for reducing greenhouse gasesThe Baltimore Sun

NV – Governor Brian Sandoval issued an executive order to reconvene the state’s New Energy Industry Task Force, which will help the Governor’s Office of Energy to support the development of “renewable energy and distributed energy resources in Nevada.” The Task Force is required to make recommendations to the state regarding compliance with federal regulations and laws but also to analyze clean energy sources, including rooftop solar power, and the creation of a modern, cost-effective energy grid. Angela Dykema, director of the Office of Energy, will chair the Task Force and will be joined by Kathryn Arbeit of First Solar and Jeremy Susac of Sunstreet. “There are few more critical issues to Nevada’s future than clean and renewable energy. Not only does this sector drive many economic-development opportunities,” said Governor Sandoval, “but it also helps us improve the quality of life for many Nevadans by helping keep our air clean, water fresh, and allows us to explore our unlimited potential in the wealth of renewables Nevada has to offer.” Nevada Governor reconvenes Energy Industry Task ForceSolar Industry News and Nevada Governor brings back Energy Industry Task ForcePV Tech

WV – The state legislature is considering easing oil and gas industry restrictions and dropping surtaxes on coal mining and natural gas drilling in West Virginia. The House of Delegates recently voted 96 to 3 to eliminate  the severance taxes of 56 cents per ton of coal and 4.7 cents per thousand cubic feet of natural gas. According to Governor Earl Ray Tomblin, who proposed dropping the severance taxes, the two levies had raised  nearly $110 million in state  revenue annually. Meanwhile, the state Senate recently passed two bills – SB 508 and SB 565 –which limit property owner’s ability to sue when their property has been devalued thanks to nearby drilling operations and to allow drillers to begin building well pads and access roads prior to getting a state-approved permit, respectively. Bills in each chamber now go to the other chamber for their consideration. WV lawmakers OK bill to drop coal, natural gas surtaxThe State Journal and Senate advanced two bills to aid gas drillersThe Charleston Gazette-Mail

Federal and Regional

The Governors of 17 states signed a pact to develop cleaner energy and transportation. Known as the Governors’ Accord for a New Energy Future, the pact calls for “embracing new energy solutions to expand the economy and protect the health of communities and natural resources.” Governor Jerry Brown of California noted the pact will explore energy-efficient regional electric grids, pooling buying power to purchase cheaper clean-energy vehicles, and research and development for  energy storage. "We believe that this is a robust driver of economic growth, not a brake on economic growth," said Washington State Governor Jay Inslee. Other states involved in the pact include Delaware, Connecticut, Hawaii, Iowa, Massachusetts, Michigan, Minnesota, New Hampshire, Nevada, New York, Oregon, Pennsylvania, Rhode Island, Vermont, and Virginia. 17 Governors announce clean energy, transportation agreementABC News

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Energy Update, February 5

In the States

AZ – The Arizona Corporation Commission voted 3 to 2 in favor of the proposed SunZia transmission line between Arizona and New Mexico. The $2 billion, 515-mile-long project seeks to export electricity generated from wind, solar, and geothermalEmilistaEmilista power in Arizona and New Mexico to markets in the western United States. SunZia, which is a joint project between Salt River Project, Shell WindEnergy, Southwestern Power Group, Tri-State Generation and Transmission Association and Tuscon Electric Power, will now go to the New Mexico Public Regulation Commission for its approval. The project received approval from the federal government last year. According to an economic impact assessment by New Mexico State University and the University of Arizona, the project could create about 35,000 jobs and help to transport power from sites that have nearly 22,000 megawatts of untapped solar and wind resources. “Today’s action by the ACC represents a significant milestone in the development of critical electric infrastructure in the Southwest United States,” Ian Calkins, a SunZia spokesman, said. SunZia gets approval for Arizona lineThe Albuquerque Business Journal

CA – A state legislator announced his intentions to bypass Governor Jerry Brown and to seek the public’s disapproval of the state’s Public Utilities Commission (CPUC) through a statewide referendum and ballot initiative. Democratic Assemblyman Mike Gatto of Glendale, who also chairs the Assembly Utilities and Commerce Committee, believes the CPUC “has been a profound disappointment to residents and hopes voters will approve his plan to dismantle it by 2018. Mr. Gatto contends the PUC is not only too close to the companies it regulates but also is slow to respect to crises, including to an ongoing gas leak in Southern California. His proposal, which needs approval by two-thirds of lawmakers to be placed on the 2016 ballot, would strip the CPUC of its constitutional protections and reallocate its responsibilities to other departments or agencies. A co-author of the measure, Assemblyman Marc Levine, a San Rafael Democrat, said “In recent history the PUC has been riddled with questions about the commission's ability to regulate with the people's best interest in mind.” Lawmaker Seeks To Dissolve California Utilities RegulatorAssociated Press

OR – Secretary of State Jeanne Atkins is investigating the state’s Business Energy Tax Credit for cases of fraud and wrongdoing. The Secretary announced that her department will issue a request for proposal to audit the entire tax credit program, which is run by the state’s Department of energy, after she and her staff discovered “extensive gaps in the [program’s] files” for the $1 billion tax credits the program has granted. Chris Pair, a spokesman for Governor Kate Brown, said “Governor Brown welcomes the effort to learn more about financial incentive program issues at the Oregon Department of Energy through this audit.” In addition to the Secretary’s review, which is slated to be completed by August 2016, the Federal Bureau of Investigations, the Oregon Department of Justice, and the state legislature are analyzing and investigating the tax credit program. Oregon Secretary of State joins crowd investigating Energy Department tax creditsThe Oregonian

SC – Governor Nikki Haley and officials from the National Renewable Energy Corporation (NARENCO) announced the company is planning to invest at least $85 million in solar power operations and projects in Allendale County.  NARENCO, which is headquartered in Charlotte, North Carolina and was established in 2009, expects their Allendale facility will be operational by the end of 2017. The project is expected to produce nearly 70 megawatts of alternating current, or enough solar energy to power approximately 14,000 homes. NARENCO has roughly 70 other solar facilities across the southeastern United States. "NARENCO's investment in Allendale is another example of a company seeing the opportunities being created by Team South Carolina's approach to creating a business-friendly environment that companies from any industry can thrive in,” said Governor Haley. “We're excited to welcome NARENCO to the South Carolina family, and to celebrate its $85 million investment in our state and our people.” NARENCO expands solar power center in Allendale, SCSouth Carolina Area Development News

Federal and Regional

The Federal Energy Regulatory Commission has approved the construction of a proposed 515-mile-long natural gas pipeline, which would cross Alabama, Georgia, and Florida. The project, which still requires the approval of the Army Corps of Engineers, is expected to deliver nearly 1 billion cubic feet per day of natural gas to Florida Power & Light, a subsidiary of NextEra Energy. Known as the Sabal Trail pipeline, the project is a joint venture between Duke Energy, Spectra Energy, and NextEra Energy. Pipeline gets federal permitThe Suwannee Democrat

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Energy Update, January 22

In the States

NY – Governor Andrew Cuomo announced the state plans to spend at least $5 billion over the next ten years  through a Clean Energy Fund established to reduce carbon dioxide emissions, to increase energy efficiency, and to promote renewable energy projects and infrastructure. The Governor’s plan, which was proposed several years ago, finally received approval from the state’s Public Service Commission. The Clean Energy Fund, according to the Governor, will help the state achieve its latest goal of generating 50% of its electricity from renewable sources by 2030 and will be managed by the state’s Energy Research and Development Authority. Approximately $1 billion of the Fund will be appropriated to solar energy projects while nearly $800 million will go to the New York Green Bank, a state-run lending program for clean energy projects. “We are raising the bar when it comes to increasing the use of renewable energy and reducing harmful carbon emissions,” said Governor Cuomo, “And I am proud that the Empire State is continuing to set the example for the future." New York Governor unveils $5B Clean Energy FundFortune

SC – Governor Nikki Haley announced that Cypress Creek Renewables, which specializes in long-term solar energy projects, will expand its operations and invest at least $12 million in South Carolina. Cypress Creek Renewables, which is based in California, is planning to build two solar power facilities in Saluda County – one nine-megawatt and one four-megawatt solar power station, or enough power to supply electricity to approximately 2,800 homes. The latest investment follows an earlier announcement by Cypress last year to invest nearly $70 million in six solar energy projects in Hampton County. All of these projects, which are expected to create hundreds of jobs, are slated to be operational by the end of 2016. “Team South Carolina’s approach to providing a business-friendly environment for all types of companies continues to pay off, and Cypress Creek’s investment in Saluda County is a testament to that,” said Governor Haley. “We look forward to seeing the impact that the renewable energy industry will have in Saluda, and across the state.” Cypress Creek Renewables establishes solar power operations in Saluda CountyThe Times and Democrat and Cypress Creek Renewables establishes solar power operations -- SGA

VA – Two state legislators, Senator Donald McEachin (D) of Henrico and Delegate Ronald Villanueva (R) of Virginia Beach, introduced legislation requiring the commonwealth’s participation in the Regional Greenhouse Gas Initiative (RGGI), a regional cap-and-trade program and cooperative effort between nine northeastern states. The bill, according to its sponsors, would “generate $250 million in new state revenue if Virginia [became] the 10th state to join RGGI, which counts Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New York, Rhode Island, and Vermont as members. The legislation also allows the state to create its own cap-and-trade program for carbon dioxide emissions. Additionally, the bill aims to direct any new state revenue received as part of Virginia joining RGGI to helping coastal communities and to energy efficiency projects. “Trying to do the right thing by the environment is not a Democratic issue; it’s not a Republican issue. It’s something we should all be concerned about,” Senator McEachin said. Lawmakers push for a cap and trade energy law with a focus on conservationThe Richmond Times-Dispatch

Federal and Regional

Following a unanimous vote from its bipartisan 22-member governors, the Governors’ Wind Energy Coalition has changed its name to the Governors’ Wind and Solar Energy Coalition (GWSC). The group plans to broaden its agenda to include solar energy issues and advocacy, which has included support for long-term extensions of federal renewable energy production and investment tax credits. The new group’s leadership, which was recently selected for 2016, will remain in place with Iowa Governor Terry Branstad as chair and Rhode Island Governor Gina Raimondo as vice chair. “The addition of solar to the Coalition’s portfolio,” said Governor Branstad, “represents a commitments to future economic and renewable energy growth, and further diversification of our nation’s energy portfolio.” Governor Raimondo added, “I support the foresight of my colleagues to broaden the Coalition’s focus and include solar energy development as a policy priority. Wind and solar provide complementary benefits to the U.S. electric grid and will help diversify the country’s energy mix.” According to SNL Energy, wind and solar energy accounted for 61% of all new generation capacity in 2015. Governors’ coalition teams up with wind energy and solar power to advance renewable energy across U.S.REVE

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