Tuesday, May 30, 2023

Debt deal short-circuits help for the grid

Your guide to the political forces shaping the energy transformation
May 30, 2023 View in browser
 
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By Arianna Skibell

One of the major transmission lines that runs to the west of Albuquerque, N.M.

One of the major transmission lines that runs to the west of Albuquerque, N.M. | Susan Montoya Bryan/AP Photo

President Joe Biden is casting his debt ceiling deal with Republicans as a win for clean energy.

But one of the greatest hurdles to greening the U.S. electric grid — transmission — was largely unaddressed by the agreement to raise the country’s borrowing limit.

The final deal, which Congress must still pass, mandates a single study on the issue of connecting solar and wind power to urban areas. But studies take time — and experts say the U.S. needs to double its rate of transmission expansion to meet Biden’s pledge to transition to a net-zero grid by 2035.

The debt compromise includes some provisions to speed up energy permitting, such as a one-year deadline for producing environmental assessments and a two-year maximum for environmental impact statements.

But without significant improvements in transmission, the nation could fail to meet its climate goals, said Jason Grumet, CEO of American Clean Power Association.

“It is critical that Congress build upon these initial steps,” Grumet said in a statement.

Kicking the electric can: While lawmakers across the political spectrum agree transmission infrastructure needs improvement, Republicans say they are wary of Democrats’ approach.

That’s why an electric grid provision from Rep. Scott Peters (D-Calif.) and Sen. John Hickenlooper (D-Colo.) ultimately failed to make it into the debt agreement.

The proposal would have effectively required regions across the country to build more transmission lines so they could transfer electricity among their power networks during times of stress. The aim was to boost resilience and the spread of more clean energy.

Rep. Garret Graves (R-La.), who helped negotiate the fiscal deal, told Nidhi Prakash that the issue is not well enough understood in Congress — hence, the study. South Carolina Rep. Jeff Duncan, a GOP member of the Energy and Commerce Committee, also told POLITICO last week that he told Graves to “not give in” to the Democrats on transmission because Republicans are “just sticking our toe in the water” on the issue.

In the meantime, the transmission clock is ticking. Abe Silverman, who studies barriers to clean energy growth at Columbia University’s Center on Global Energy Policy, said the worst-case scenario is that adding the study into the debt ceiling deal delays any real action.

“We need thousands of miles of new transmission by the early 2030s. That’s going to take at least five years to permit and at least another five years to build,” he told Nidhi. “So we’re in 2025 before we even get started.”

Read more about it: What’s in and what’s out of the debt limit agreement.

 

It's Tuesday — thank you for tuning in to POLITICO's Power Switch. I'm your host, Arianna Skibell. Power Switch is brought to you by the journalists behind E&E News and POLITICO Energy. Send your tips, comments, questions to askibell@eenews.net.

 

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Today in POLITICO Energy’s podcast: Josh Siegel speaks with Pedro Pizarro, the president and CEO of Edison International, about the federal policy issues affecting the nation’s power grid.

Power Centers

President Joe Biden talks with reporters

President Joe Biden talks with reporters before boarding Marine One on the South Lawn of the White House. | Susan Walsh/AP Photo

Debt deal climate gamble
Climate advocates are assailing what they call “poison pills” in the debt limit deal the White House made with congressional Republicans over the weekend. Some are even vowing to blockade Senate Majority Leader Chuck Schumer’s (D-N.Y.) home in Brooklyn, write Robin Bravender and Timothy Cama.

The backlash from the left marks the latest skirmish between the Biden White House and climate hawks still fuming over the administration’s decision earlier this year to greenlight the massive Willow oil and gas drilling project on federal land in Alaska.

Manchin's pet pipeline
One of the major points of contention in the bill is a provision to fast-track the embattled Mountain Valley pipeline, a 303-mile natural gas project favored by West Virginia Democratic Sen. Joe Manchin, write Carlos Anchondo and Niina H. Farah.

Legal experts said Congress’ proposed legislation would likely shield the project — which has seen permit after permit tossed out by the 4th U.S. Circuit Court of Appeals — from new efforts to hold it up in court.

Carbon border tax tension
Two senior U.K. ministers are at odds over a potential new green border tax on carbon-intensive imports, writes Stefan Boscia.

Energy Secretary Grant Shapps and his department want a carbon border adjustment mechanism as part of Britain's drive to cut emissions to net-zero, while Business and Trade Secretary Kemi Badenoch is pushing in the other direction.

In Other News

A mechanized shovel loads a haul truck with coal at the Spring Creek coal mine near Decker, Mont.

A mechanized shovel loads a haul truck with coal at a mine near Decker, Mont. | Matthew Brown/AP Photo

Polluters on trial: A Montana judge has refused to cancel the first U.S. climate trial.

Insurance: State Farm says it won’t insure new California customers due to wildfires and high costs. The startling decision threatens to further destabilize the state’s insurance market.

 

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A showcase of some of our best subscriber content.

A wind turbine.

A turbine spinning off the coast of Block Island, R.I. | David Goldman/AP Photo

Massachusetts and Connecticut are hoping to leverage millions of federal dollars to ready the New England grid for offshore wind.

Several international insurance companies have exited a major climate finance alliance amid attacks from U.S. conservatives on the industry’s environmental efforts.

Canada has yet to commission a single offshore wind project. It hopes to change that by modernizing petroleum rights provisions.

That's it for today, folks! Thanks for reading.

 

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