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On this episode of The Unregulated Podcast Tom Pyle and Mike McKenna recap the latest happenings on Capitol Hill and are joined by The Honorable Jason Isaac, of the Texas Public Policy Institute, for a wide ranging discussion on all things energy.
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Biden’s Department of Energy (DOE) has increased the time it takes to review a permit for exporting LNG from 7 weeks to a minimum of 11 months. The slowing of permit approval could mean that nearly-completed LNG projects are not able to supply European buyers in need of gas because they do not have the permit. The drastic slowing of LNG export permits represents the most significant limit thus far on an industry planning to add 50 percent more to U.S. export capacity by 2026. The average time for issuing an export license for supplying the super-chilled gas to non-Free Trade Agreement (non-FTA) countries, climbed under the Biden administration to over 330 days from 155 days under the Obama administration and 48 days under the Trump administration. Non-FTA countries are the biggest buyers of U.S. LNG, but the Biden administration’s DOE has slowed decisions for economic, political and environmental reasons as Biden’s allies in the climate activist business have rallied to oppose new LNG facilities. Without these permits, projects that supply non-FTA countries cannot move forward. By law, exports to FTA nations must be approved quickly and affirmatively.
Commonwealth LNG has been waiting for almost a year after receiving its environmental approval for a permit to export LNG to non-FTA countries. Its Cameron, Louisiana, project has plans to start construction in the third quarter of next year with preliminary deals for the sale of 5 million metric tons per annum, mainly to non-FTA countries. New Fortress Energy filed 11 months ago for a non-FTA authorization for its Altamira FLNG facility, which is near to starting production. But the 1.4 million metric ton project will be unable to sell its gas to non-FTA countries including the Netherlands, UK, France, Spain and Germany. This is despite Biden’s promises to make LNG exports to Europe easier.
According to a DOE spokesperson, the agency considers more than environmental approvals in its non-FTA decisions. Many factors affect the amount of time DOE needs to review an application, including issues raised by “interveners” in any specific proceeding. DOE claims it approved non-FTA authorizations for projects representing almost 45 percent of the about 103 billion cubic feet per day production of domestic dry gas.
Background
In August 2014, DOE revised the process it uses to determine approval for a non-FTA permit application. Under the rule, DOE may act on a non-FTA request within 30 days after the Federal Energy Regulatory Commission (FERC) has issued a final environmental impact statement for the project. In practice, however, DOE has waited until after FERC has issued a final order, which usually adds a few months to the timeline.
According to an article in Real Clear Energy, Obama’s Energy Department made nine major non-FTA decisions for eight projects, taking an average of 155 days to reach a decision after the FERC order was issued. During the Trump administration, the number of major LNG decisions made by DOE increased to 13 while the average time to make a decision dropped to 48 days. President Biden promised to “end fossil fuels,” while President Trump promoted American energy dominance.
The Real Clear Energy article also noted that there are two major U.S. LNG projects that have been approved by FERC since Biden was inaugurated in 2021. One of those projects was recently authorized unanimously (Port Arthur Phase II), but the other (Commonwealth LNG) was given approval by FERC on November 18, 2022. It has been awaiting a DOE non-FTA decision for over 325 days, which is more than twice as long as the average during the Obama years and almost seven times longer than in the Trump administration.
The article also noted that while DOE has yet to act on a major U.S. LNG export application request, it approved five smaller requests for U.S. LNG export project capacity increases, primarily from operating facilities. Even the minor decisions have taken a very long time. The average time from FERC to DOE action was 330 days, and the longest application was pending for 678 days. President Biden’s rhetoric about helping European allies seems to conflict with his inactions and delays.
Conclusion
The House of Representatives twice passed legislation to simplify the U.S. LNG regulatory process by granting full authority to FERC to make U.S. LNG export decisions. U.S. LNG exports are making substantial contributions to U.S. trade balances and domestic employment and bolstering the energy security of our allies. The disruption of pipeline gas shipments to Europe following the Russian invasion of Ukraine hurt European economic growth and security. Without U.S. LNG, Europe’s energy situation after the Russian invasion of Ukraine would be much more problematic. Ditte Juul Jørgensen, the European Commission’s Director-General for Energy, noted that the EU will need U.S. gas for decades. DOE’s slow permit approvals could result in delays for new U.S. LNG supplies and cost increases.
On this episode of The Unregulated Podcast Tom Pyle and Mike McKenna discuss carbon tax news in the states and north of the border, the latest lunacy from America’s left wing, and give some insight into the evolving situation involving Iran.
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Today, Senators Cassidy and Graham introduced a carbon tax on imports from high-greenhouse gas emitting countries. We have some questions for the Senators:
The first major legislation House Republicans passed under Speaker Mike Johnson’s leadership would cut billions of dollars in green subsidies for energy efficiency upgrades included in President Biden’s climate law, the Inflation Reduction Act. The $58 billion measure, which funds the Energy Department and other agencies, rescinds more than $5.5 billion from the Inflation Reduction Act, including a $4.5 billion program for homeowners to switch to more energy efficient appliances and a $1 billion grant program to help states develop more stringent building energy codes, presumably so the states can do the Administration’s dirty work telling people what kind of appliances they can buy. The bill, approved on a 210-199 vote, also slashes the Energy Department’s energy efficiency and renewable energy office funding by 42 percent below last year’s levels and revokes $15 billion in loan authority from the department’s loan guarantee program. The House measure is not expected to pass the Senate or receive Biden’s signature without changes. It represents the House Republicans’ starting point as they negotiate spending ahead of a mid-November government shutdown deadline, and it is a good start.
Jonson’s Aggressive Schedule
Johnson has pledged the House will vote on the remaining spending bills in the coming weeks. In an October 23 memorandum to colleagues, Johnson indicated that the House would work through the eight remaining appropriations bills between now and November 17, when the government would shut down absent congressional action. The Energy-Water bill would be followed by the bill to fund the Department of the Interior and EPA. Both the Energy-Water and Interior-EPA bills have deep cuts from Biden’s wish list of “green” spending. Such spending in various bills has exploded under Biden, with Vice President Kamala Harris admitting that they plan to spend $1 trillion on their climate plans. In addition, the Speaker pledged that in December, the House will pass a reauthorization of the farm bill in time to avoid an expiration of the three-month extension Congress approved in September. Johnson also planned to launch negotiations with the Senate on the National Defense Authorization Act by next month for passage by December. That bill usually carries significant energy and environment provisions. Johnson also wants to begin negotiations on the FAA reauthorization “as soon as the Senate passes it,” presumably sometime in the next four weeks.
For next year, the Speaker expects that between May and July, the House should complete consideration of all fiscal year 2025 spending bills as well as funding for the Water Resources Development Act and the fiscal year 2025 National Defense Authorization Act. Johnson believes the chamber should not break for its annual summer district work period unless all 12 of next year’s appropriations bills have passed the House. If they do, he plans to wrap up negotiations with the White House and Senate before the next fiscal year ends on September 30.
Johnson committed to pursuing single-issue spending bills rather than opting for a larger spending package like a continuing resolution or an omnibus. In the past, such omnibus bills have been used to throw all spending in together, so members of Congress must vote for or against everything. Few Congresspeople who might want to reduce funding for crony “green capitalism” want to be accused of voting against Veterans benefits when they are lumped together. Johnson, however, cautioned in his October 23 memorandum that if another stopgap measure is needed to extend government funding beyond the November 17 deadline, he would propose a measure that expires on January 15 or April 15 (based on what can obtain Conference consensus), to ensure the Senate cannot jam the House with a Christmas omnibus.
Johnson will also be confronted with a $50 billion supplemental spending request for domestic programs, including disaster relief and wildfire prevention that really should be part of the appropriation bills, and a request of more than $100 billion for Ukraine, Israel and other things Biden wants. Johnson has proposed cutting $14.3 billion from the $80 billion of new funding provided for the IRS to pay for the Israel aid.
Conclusion
Johnson sees each of these actions as a “return to legislating” and an opportunity to get back to “effectively messaging on our top issues and priorities.” He believes his objectives can be accomplished in a manner that delivers on principled commitments to rein in wasteful spending, and put the country back on a path to fiscal responsibility. The House will no doubt have fights with the Biden White House that considers climate a more existential threat than wars in the Middle East and Russia. House Republicans projected unity and confidence that they would be able to fulfill Johnson’s objectives. However, time will tell if he can accomplish the huge task.
#152: Speaker for a Day (10/13/23)
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Harvard student groups: www.forbes.com/sites/brianbushar…iticizing-israel/
Special K Moves Out of His Lane:
x.com/ClimateEnvoy/status/1712195662899495233?s=20
Jennifer Rubin:
x.com/JRubinBlogger/status/1…10735911418315152?s=20
Economy: consumers buckle Walmart CEO warns: www.cnbc.com/2023/10/09/consume…almart-us-ceo.html
Biden: You Get More Legs
x.com/atrupar/status/1710333560953979242?s=20
Energy: Renewables aren’t profitable in Europe: www.reuters.com/business/energy/e…mc_eid=cba1fa94e8
EVs: Treasury Guidance
home.treasury.gov/news/press-releases/jy1783
Climate: Survivor Might Not Survive Because Climate Change
www.nytimes.com/2023/10/10/arts/t…amazing-race.html
The Biden administration finalized national efficiency rules for residential gas furnaces, which will require non-weatherized gas furnaces and those used in mobile homes to achieve a 95 percent annual fuel utilization efficiency standard by late 2028. That is, manufacturers would only be allowed to sell furnaces that convert at least 95 percent of fuel into heat. The current market standard for a residential furnace is 80 percent. The new standards will phase out older furnaces and make newer models mandatory, affecting about a third of U.S. homes, and eliminate consumer choice in another appliance area. Because of the stringent requirements, the regulations would largely take non-condensing gas furnaces, which are cheaper, off the market. Replacing a non-condensing furnace with a condensing furnace would entail hefty installation costs as many consumers will need to install new equipment to exhaust gas out of their home to accommodate the higher efficiency units, the condensing units.
The rule is part of the Department of Energy’s new efficiency standards that it has proposed or finalized for 24 appliances, according to its press release. The new gas furnace rule, opposed by the American Gas Association (AGA), could prohibit 40 to 60 percent of gas furnaces currently in homes. According to the AGA, gas furnaces are more cost effective, and the electrification of multiple appliances would be costly to consumers as many gas appliances are more cost effective. DOE claims that the new regulations will eventually cut household utility costs by $1.5 billion on an annual basis. Residential gas furnaces account for approximately 19 percent of annual residential energy use in the United States. They are particularly favored in colder regions of the country where heat pumps have not been able to handle heating comfortably.
Over the last several months, the DOE has unveiled new standards for a wide variety of appliances including gas stoves, dish washers, clothes washers, refrigerators and air conditioners. The crack down on appliance efficiency standards is a part of Biden administration’s push to electrify all appliances as part of its climate agenda. The DOE plans to spend $225 million helping state and local governments adopt building codes that push electrification and move away from gas appliances. The Biden administration is supporting a transition to electric heat pumps, despite the cost to American families to convert and the operating expense as electricity prices are increasing despite substantial subsidies for renewable generation technologies.
In February, the DOE proposed a rule to create new energy efficiency standards for gas stoves that would make at least half of U.S. stove models ineligible for repurchase in stores, and potentially a much higher percentage. The Biden administration also proposed a rule in June that would require gas generators to turn off after reaching a certain level of emissions. In July, the Biden administration announced a proposed rule affecting water heaters and proposed new rules in March for refrigerators and laundry machines that could impose billions of dollars of new costs on consumers.
According to the current federal Unified Agenda, a government-wide, semiannual list that highlights regulations agencies plan to propose or finalize within the next 12 months, the Biden administration is additionally moving forward with rules impacting dozens more appliances, including pool pumps, battery chargers, ceiling fans and dehumidifiers.
Conclusion
Biden’s energy department announced a new standard on gas furnaces requiring a 95 percent efficiency rate that would phase out less expensive gas units. The new rule would require retrofits for many homes that would be extremely cost prohibitive as many consumers would need to install new equipment to exhaust gas out of their home to accommodate the higher efficiency condensing units. The rule will force consumers toward electrification as the Biden administration would prefer consumers to switch to heat pumps whether they make sense for their area or their house or not.
The Biden administration’s energy department is working feverishly on updating appliance standards that would phase out many appliances that are currently in American homes. In December, DOE boasted that it had taken 110 actions on energy efficiency rules in 2022 alone as part of the President’s climate agenda, indicating that they would save consumers money. President Biden’s green energy policies, however, seek to control consumers’ choice and they are actually a costly and increasingly disruptive burden on American households.
*This article was adapted from content originally published by the Institute for Energy Research.
On this episode of The Unregulated Podcast Tom Pyle and Mike McKenna discuss the fight for the speakership, California’s new senator, busted electric buses, and Germany’s return to coal.
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