| | | | | |  | | By Kelsey Tamborrino | With help from Anthony Adragna and Annie Snider Editor's Note: Morning Energy is a free version of POLITICO Pro Energy's morning newsletter, which is delivered to our subscribers each morning at 6 a.m. The POLITICO Pro platform combines the news you need with tools you can use to take action on the day's biggest stories. Act on the news with POLITICO Pro. | | | | | | | — The same U.S. companies that fought rules to tamp down methane emissions are now signaling that the Biden administration's promised crackdown on methane emissions may be just what the industry needs. — World leaders convened virtually this weekend for a climate summit aimed at delivering new, ambitious pledges on the five-year anniversary of the Paris climate agreement. — Congress managed to skirt a brief government shutdown on Friday, buying a few more days for congressional negotiators to finalize a massive funding package and a stimulus deal that has eluded lawmakers for months. WELCOME BACK! IT'S MONDAY. I'm your host, Kelsey Tamborrino. James Noe at Jones Walker LLP gets the trivia win for knowing Charles Lindbergh was the first TIME Man of the Year in 1927 for making the first solo nonstop flight across the Atlantic Ocean. For today: What bill broke a 114-year history of not holding votes in the Senate on Christmas Eve? Send your tips and trivia answers to ktamborrino@politico.com. Check out the POLITICO Energy podcast — all the energy and environmental politics and policy news you need to start your day, in just five minutes. Listen and subscribe for free at politico.com/energy-podcast. On today's episode: Why American oil is ready for more regulation | | | JUST WHAT THEY NEEDED: U.S. oil and gas producers have spent years fighting government rules clamping down on emissions of the greenhouse gas methane. Now, a growing number of companies say they think President-elect Joe Biden's promised methane regulations may be just what the industry needs, Pro's Ben Lefebvre reports this morning. "Certainly you've got a situation where certain industry leaders have come out in support of regulations," said Mark Brownstein, vice president and Environmental Defense Fund, which works with companies to try to track and reduce their methane emissions. "In part it's because they get the global picture. They understand it's no longer tenable to make the claim that gas is a clean, low-carbon resource and then fight against implementing regulations that guarantee that's the case." | 
President-elect Joe Biden speaks during an event at the Queen Theatre on Dec. 11, 2020 in Wilmington, Del. | Photo by Chip Somodevilla/Getty Images | But that change of heart doesn't come from a new-found well of environmental consciousness, Ben writes, but rather growing pressure to placate investors who are increasingly worried about sustainability and climate issues, people in the oil and banking industries said. The industry is fighting to continue tapping the massive U.S. shale reserves that have made gas the fuel of choice for utilities at home, while expanding U.S. exports to foreign markets. But the sharp growth in production that helped natural gas replace coal as the leading fuel for U.S. power in the U.S. has been accompanied by methane emissions that are a far more potent greenhouse gas than carbon dioxide, though they have a shorter lifespan in the atmosphere. "They need regulations to be explicit," one oil and gas lobbyist said of what the industry is looking for out of the Biden administration. "They need to be able to say [to investors] what they are doing is sustainable gas or whatever you want to call it. And without a federal regulation, that will be tough to do." Biden has promised to crack down on methane as soon as he is sworn in next month. On his first day in office, he "will take actions including requiring aggressive methane pollution limits for new and existing oil and gas operations," according to his website. The Biden administration will also negotiate with foreign governments to form new, tougher international emission targets. | | | | BIG SCOOPS IN TRANSITION PLAYBOOK: In the runup to Inauguration Day, president-elect Joe Biden's staffing decisions are sending clear-cut signals about his priorities. What do these signals foretell? Transition Playbook is the definitive guide to one of the most consequential transfers of power in American history. Written for political insiders, this scoop-filled newsletter is breaking big news and analyzing the appointments, people and emerging power centers of the new administration. Track the transition and the first 100 days of the incoming administration. Subscribe today. | | | | | | | | WHAT HAPPENED AT THE CLIMATE SUMMIT? More than 70 world leaders took part in Saturday's U.N.-led virtual summit aimed at squeezing countries for bigger climate pledges, Pro's Kalina Oroschakoff reports . During the event, leaders from China to Argentina, Canada, the U.K. and the EU all touted new emissions promises that are meant to speed up the effort to combat climate change on the fifth anniversary of the Paris agreement. Here are some takeaways: — Most of the attention was fixed on Chinese leader Xi Jinping, who in September surprised the world with a plan to slash carbon pollution to net zero before 2060. There was hope that he'd flesh out the declaration with more specifics, Kalina writes. In his video message, Xi pledged to cut carbon dioxide emissions per unit of GDP by 65 percent from 2005, boost the share of non-fossil fuels in primary energy use by 25 percent, increase the country's forest stock from 2005 levels, and increase the total capacity of solar and wind to over 1.2 billion kilowatts. Climate campaigners hoped he'd pledge to peak emissions by 2025 — which he didn't do. — The United States, which is the world's second-largest polluter, wasn't at the meeting. However, Biden issued a statement that again committed to rejoining the Paris agreement on his first day in office and said his administration would "put the country on a sustainable path to achieve net-zero emissions no later than 2050." — The European Union, which emits about a tenth of the world's greenhouse gases, showed up with its hard-fought pledge to slash its emissions by 55 percent by 2030. — The event was also a chance for the U.K. to tout its post-Brexit example of climate leadership by promising to raise the country's 2030 emissions cut to 68 percent and pursue a green industrial strategy that would make the country "the Saudi Arabia of wind," as Prime Minister Boris Johnson said. Campaigners cheered his announcement to end foreign fossil fuel financing. — Some action also came from the G20 nations. Argentina announced net-zero emission goals by 2050. India touted its renewable achievements without committing to higher emission cuts in the coming years. Canada promised to raise its 2030 emissions target, and on Friday committed to hiking its national carbon tax to C$170 per metric ton. — Russia, Brazil, Saudi Arabia and Australia were missing from the event, which was only open to countries making substantial new climate pledges. | | | SHUTDOWN STOPPED, BUT FUNDING FIGHT CONTINUES: The Senate thwarted a government shutdown Friday by passing a one-week funding bill by voice vote, capping off hours of drama after several senators threatened to hold up the resolution, POLITICO's Caitlin Emma, Marianne LeVine and Andrew Desiderio report. President Donald Trump signed the measure on Friday night. The bill buys congressional negotiators a little more time to finish up talks on a $1.4 trillion omnibus spending package that would boost federal agency budgets for the rest of the fiscal year, in addition to billions of dollars in pandemic aid that millions of Americans will lose over the holidays. While the weeklong stopgap punts the government funding deadline to this Friday, congressional negotiators realistically only have a few more days to finalize a massive government funding package and a fiscal stimulus deal that has eluded Congress for months. | 
Senate Majority Leader Mitch McConnell walks to his office from the Senate Floor on Dec. 11, 2020. The Senate passed a one week stop-gap bill on Friday, avoiding a partial government shutdown. | Photo by Stefani Reynolds/Getty Images | One thing to watch: Even as — incredibly — the contours of the end-of-year package remain unclear before the Dec. 18 deadline to fund the government, ME will be watching to see whether any energy package hitches a ride on the eventual package. Sources on and off the Hill said energy bill negotiators made substantial progress in the last week at negotiating a package pulling from the Senate's energy bill, S. 2657 (116), and a House-passed measure, H.R. 4447 (116) , that would likely include bills boosting technologies like energy storage, advanced nuclear and carbon capture technologies, as well as a compromise phasing down the use of hydrofluorocarbons. However, the emerging package has drawn the ire of progressive and environmental justice groups who are urging Democrats to walk away and try again next Congress. "We have serious concerns about the prospects of the Senate moving legislation in lame duck that will provide subsidies to support fossil fuels, offshore drilling, and nuclear energy, as well as support false climate solutions like carbon capture and storage, biofuels, offsets and carbon pricing," read a letter they sent last week. The situation remains fluid on the Hill but if any sort of package emerges beyond a continuing resolution, there's a good likelihood an energy package could hitch a ride on that vehicle. It should be a wild week. NDAA HEADS TO TRUMP: The Senate on Friday also overwhelmingly approved this year's defense policy legislation, H.R. 6395 (116), setting up a confrontation with Trump, who again threatened to veto the bill on Sunday. Congressional leaders have telegraphed that they'll likely be able to muster enough votes to overturn Trump's veto, Pro's Connor O'Brien reports, though some Republicans could side with Trump on an override vote. Both the House and Senate passed the compromise bill with veto-proof majorities. | | | CDC STUDYING LINK BETWEEN PFAS & COVID: The CDC is researching whether there is a link between PFAS levels in a person's body and their vulnerability to Covid-19, CDC Director Robert Redfield said in a Nov. 6 letter to Rep. Dan Kildee that was released Friday . The work is part of a broader study focused on health care personnel and first responders, and will also look at potential implications of PFAS exposure for vaccine efficacy, after prior research has shown that PFAS can harm the immune system and decrease the body's response to vaccines. Redfield said his agency has also solicited applications for research on the impact of other environmental exposures on Covid-19. | | | | HAPPENING TUESDAY - CONFRONTING INEQUALITY IN AMERICA TOWN HALL : The pandemic-induced recession has put over 40 million Americans at risk of foreclosure and eviction and caused a steady decline in Black homeownership. What solutions need to happen to make housing more inclusive and fair? Join POLITICO for its fourth town hall in the series "Confronting Inequality in America." Our latest town hall explores "The Housing Gap" and will convene policymakers, lawmakers, advocates and mortgage industry leaders to discuss various approaches for eliminating housing inequality as we begin to recover from the Covid-19 recession. REGISTER HERE. | | | | | | | | SOUTHEAST COMPANIES AIM TO FORM LIMITED ENERGY MARKET: Utilities and power cooperatives in the Southeast, including Southern Company, Duke Energy and TVA, plan to ask FERC to let them form a limited energy exchange, the companies said Friday. They plan to create a platform to facilitate 15 minute-ahead, bilateral power trades called the Southeast Energy Exchange Market, Pro's Eric Wolff reports. The founding members conducted a study and found that even a limited market could save them $40 million to $50 million annually, with that figure potentially doubling later as solar and wind become a larger part of their portfolios. Unlike the other major power markets around the country , SEEM members will still own all of their transmission, generation and distribution assets. The companies plan to ask FERC for approval of the market by the end of the year. HOME IS WHERE THE EMISSIONS ARE: Three years ago, California homebuilders worked out a deal with state regulators: In exchange for installing solar panels on new homes starting in 2020, future properties wouldn't face stricter climate rules for a decade. Now, it appears that arrangement isn't as ironclad as they hoped, California Pro's Colby Bermel reports. Since the agreement, which was only revealed recently, two Californias have emerged for developers. Forty cities have banned or phased out natural gas in new buildings. What's left — some 85 percent of the state — remains governed by the California building code, which is updated every three years. State agencies are working to significantly slash California's air pollution by 2045 , and a big piece of the puzzle is how to tackle the 25 percent of the state's emissions that come from buildings, Colby reports. But uncovering that little-known 2017 handshake deal has shaken up the California Energy Commission's latest update to building energy efficiency standards just as draft rules are slated to be released in February. And environmentalists are seizing on the agreement as a sign the CEC has a predetermined outcome. Meanwhile, California Building Industry Association, the main trade group representing developers, is crying foul, claiming the agency is moving to strongly regulate industry in 2022 despite pledging to hold off until 2025. | | | — "Bipartisan group to offer 2-part coronavirus relief package," via POLITICO. — "Forest Service supports Mountain Valley Pipeline route through Jefferson National Forest," via Charleston Gazette-Mail. — "Nord Stream 2 work resumes despite U.S. efforts to stop it," via Bloomberg. — "Army Corps report supports Mississippi flood-control pumps," via Associated Press. THAT'S ALL FOR ME! | | | | Follow us on Twitter | | | | Follow us | | | | |
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