RNG NEWS
EPA Sets 2018 Cellulosic Waiver Credit Price at $1.96 Each
The U.S. Environmental Protection Agency (EPA) announced that the federally issued waiver credits needed to meet certain cellulosic fuel blending mandates in 2018 will cost $1.96 each.
For any calendar year for which the projected volume of cellulosic biofuel production is less than the applicable volume of cellulosic biofuel set forth in Clean Air Act (CAA), EPA must reduce the required volume of cellulosic biofuel for that year to the projected volume, and must provide obligated parties the opportunity to purchase cellulosic waiver credits (CWC). The price of these credits is determined using a formula specified in CAA section 211(o)(2)(B)(III).
Con Edison Calls for Non-Pipeline Solutions to Manage Natural Gas Demand
New York gas provider Con Edison published notification that it is launching a Smart Solutions for Natural Gas Customers Program in order to manage the growth of peak demand and advance environmentally-sound energy, while considering the overall cost impact to customers. The program is designed to meet customers’ heating needs cost effectively and contribute to the achievement of state and local environmental goals, without requiring the development of new pipelines.
Con Edison will issue an RFP in mid-December for non-pipeline solutions to help reduce natural gas demand, particularly calling for innovative and substantial non-pipeline projects that can reduce winter peak day gas load or provide gas supplies from local alternatives.
New York gas provider Con Edison published notification that it is launching a Smart Solutions for Natural Gas Customers Program in order to manage the growth of peak demand and advance environmentally-sound energy, while considering the overall cost impact to customers. The program is designed to meet customers’ heating needs cost effectively and contribute to the achievement of state and local environmental goals, without requiring the development of new pipelines.
Con Edison will issue an RFP in mid-December for non-pipeline solutions to help reduce natural gas demand, particularly calling for innovative and substantial non-pipeline projects that can reduce winter peak day gas load or provide gas supplies from local alternatives.
Large contracts are available and proposals can address either the supply or demand side. Solutions could include, but are not limited to:
- energy efficiency
- beneficial electrification of space or water heating
- demand response programs
- provision of biogas
- distributed natural gas storage, CNG, or LNG
- and/or other projects that can offset the need for incremental pipeline capacity.
Con Edison delivers gas to 1.1 million customers in Manhattan, the Bronx, parts of Queens, and most of Westchester County. Demand for natural gas has grown substantially in recent years, and is expected to continue growing throughout the next 20 years.
President Trump Says He Remains committed to the RFS in Meeting with Senators Over RFS Compliance Concerns
On December 7, at the request of Senator Ted Cruz (R-TX.), President Trump met with a group of Senators to discuss the Renewable Fuel Standard (RFS) program and possible reforms. Those in attendance were largely Senators from States with oil interests (particularly states with merchant refiner interests), as well as EPA Administrator Pruitt, Agriculture Secretary Perdue, and Energy Secretary Perry.
Refiners, particularly merchant refiners, have opposed the RFS and have raised concerns with high RIN prices largely related to ethanol under the “implied conventional” biofuel requirement. Statements from those attending the meeting indicated that President Trump expressed a desire to help refiners, but also wants to protect the interests of farmers and remains committed to the RFS. Sen. Cruz indicated that there will be ongoing discussion, including reconvening with President Trump next week to discuss potential solutions.
On December 7, at the request of Senator Ted Cruz (R-TX.), President Trump met with a group of Senators to discuss the Renewable Fuel Standard (RFS) program and possible reforms. Those in attendance were largely Senators from states with oil interests (particularly states with merchant refiner interests), as well as EPA Administrator Pruitt, Agriculture Secretary Perdue, and Energy Secretary Perry.
Refiners have opposed the RFS and have raised concerns with high RIN prices. Statements from those attending the meeting indicated that President Trump expressed a desire to help refiners, but also wants to protect the interests of farmers and remains committed to the RFS. Sen. Cruz indicated that there will be ongoing discussion, including reconvening with President Trump next week to discuss potential solutions.
Read more about the meeting HERE.
EPA Administrator Pruitt Fields Questions from House Energy & Commerce Subcommittee on Environment
EPA Administrator Pruitt fielded questions at a hearing before the House Energy & Commerce Subcommittee on Environment, entitled “The Mission of the U.S. Environmental Protection Agency.”
During the question and answer portion of the hearing, some of the Subcommittee members raised questions regarding the RFS. Rep. Green (D.-Tex.) asked if EPA would limit the ethanol portion of the program to 9.7% of the gasoline pool, which has been a request of the refining industry, and Rep. Olson (R.-Tex.) asserted EPA had “leeway” moving forward until Congress may act. Rep. Loebsack (D.-Iowa) asked Administrator Pruitt about the cellulosic volume for 2018, which he noted was still less than what was finalized for 2017.
Pruitt's responses gave no indication of any potential actions beyond that EPA is monitoring and concerned with issues raised by Subcommittee Members. He did note, in response to a question, that EPA has begun its analysis of the environmental impacts of the RFS program, which is required by statute and the prior Administration had agreed to complete.
Joint House/Senate Conference Committee Working to Produce Final Tax Reform Bill
With both the House and Senate having approved their respective versions of H.R. 1, the Tax Cuts and Jobs Act, a joint House/Senate conference committee has been formed to reconcile the differences between the measures.
The conferees are expected to ultimately report a final package for both the House and Senate to consider prior to December 22. If the conference report is approved, it will be sent to the President to sign into law. Republican Leadership and the White House have made completing tax reform legislation prior to Christmas their top legislative priority.
With both the House and Senate having approved their respective versions of H.R. 1, the Tax Cuts and Jobs Act, a joint House/Senate conference committee has been formed to reconcile the differences between the measures.
The conferees are expected to ultimately report a final package for both the House and Senate to consider prior to December 22. If the conference report is approved, it will be sent to the President to sign into law. Republican Leadership and the White House have made completing tax reform legislation prior to Christmas their top legislative priority.
Though there are notable similarities between the packages, conferees will need to resolve specific differences between the bills, and do so in a way that complies with the strict procedural rules that govern consideration of a reconciliation bill in the U.S. Senate.
EPA Issues Interpretation of its RFS Periodic Review Obligations
On November 30, U.S. EPA published a document titled "Periodic Reviews for the Renewable Fuel Standard Program,” describing EPA's interpretation of its requirement under the RFS [in 42 U.S.C. §7545(o)(11)] to conduct periodic reviews of existing technologies and the feasibility of compliance with the RFS related to prescribed volume requirements [in paragraph (o)(2)(B)].
On November 30, U.S. EPA published a document titled "Periodic Reviews for the Renewable Fuel Standard Program,” describing EPA's interpretation of its requirement under the RFS [in 42 U.S.C. §7545(o)(11)] to conduct periodic reviews of existing technologies and the feasibility of compliance with the RFS related to prescribed volume requirements [in paragraph (o)(2)(B)].
The document explains how EPA has fulfilled its obligation to conduct these reviews to date, which has largely been through its consideration and application of its waiver authority. EPA’s notice does not explain the impetus for issuing this interpretation, aside from noting certain ambiguities in the statutory language.
View more information on EPA’s interpretation in the document HERE.
Texas Governor Asks EPA for Additional Waivers Under RFS
On December 1, the day after EPA issued its final 2018 standards under the Renewable Fuel Standard (RFS) program, Governor Abbott (R) of Texas sent a letter to EPA Administrator Pruitt requesting EPA use its general waiver authority, citing the number of refiners in the State of Texas allegedly being harmed by high RIN prices. The letter appears to be limited to a request that EPA reduce the D6 requirements (sometimes referred to as the implied “conventional biofuel” requirement) under the RFS to 9.7% of the gasoline pool.
This letter is in addition to a similar letter sent by the Governor of Pennsylvania in November, which also cited the economic impacts on refiners in the state. EPA has since indicated it will respond to the Pennsylvania Governor’s request in a separate action.
EPA Finalizes Denial of Requests to Change “Point of Obligation”
On November 30, U.S. EPA published its final determination to deny requests to change the “point of obligation” under the Renewable Fuel Standard (RFS) program. The decision was consistent with EPA Administrator Pruitt’s earlier indications, including an October 2017 letter to seven Senators.
Previous requests generally sought to move compliance with the RFS volume requirements from refiners and importers of gasoline and diesel fuel to entities downstream (e.g., “position holders” at the rack). The decision re-affirmed that EPA's existing definition of “obligated party” applies “in all years going forward unless and until it is revised.”
On November 30, U.S. EPA published its final determination to deny requests to change the “point of obligation” under the Renewable Fuel Standard (RFS) program. The decision was consistent with EPA Administrator Pruitt’s earlier indications, including an October 2017 letter to seven Senators.
Previous requests generally sought to move compliance with the RFS volume requirements from refiners and importers of gasoline and diesel fuel to entities downstream (e.g., “position holders” at the rack). The decision re-affirmed that EPA's existing definition of “obligated party” applies “in all years going forward unless and until it is revised.”
Among the several reasons identified in support of its denial was that EPA did not believe a change in the definition of obligated party would result in increased investment in cellulosic biofuels. The denial constitutes final agency action that is judicially reviewable under 42 U.S.C. §7607(b) of the Clean Air Act, id., and there are already several cases involving this issue.
View more information on EPA’s determination HERE.
French utility Engie plans to switch all of its gas operations to biogas and renewable hydrogen by 2050
By Geert De Clercq, Reuters.
PARIS - French utility Engie plans to switch all of its gas operations to biogas and renewable hydrogen by 2050, making it 100 percent green, its chief executive said on Monday.
By Geert De Clercq, Reuters.
PARIS - French utility Engie plans to switch all of its gas operations to biogas and renewable hydrogen by 2050, making it 100 percent green, its chief executive said on Monday.
The power and gas group has some 70 biogas projects worldwide, including 40 in France, and says that if all its projects get approval its annual investment in biogas could soar tenfold to hundreds of millions of euros per year.
Engie, which has sold its fossil gas activities as part of a broader restructuring, is also looking to invest in industrial-scale hydrogen production by electrolyze water in places where solar energy is cheap.
Oil and gas companies to engage in voluntary program to reduce methane emissions
By Amy Harder, Axios.
The American Petroleum Institute is announcing today a new voluntary program to cut emissions of methane, a potent greenhouse gas, and other air pollution from oil and natural gas wells.
Why it matters: This is the first time in API's nearly 100-year history that it has launched a program to cut air pollution. It's also the most concrete sign climate change is becoming a significant mainstream concern within the disparate oil and gas industry. Moves like this by trade groups represent the lowest, not highest, common denominator for positions within any given sector.
By Amy Harder, Axios.
The American Petroleum Institute is announcing today a new voluntary program to cut emissions of methane, a potent greenhouse gas, and other air pollution from oil and natural gas wells.
Why it matters: This is the first time in API's nearly 100-year history that it has launched a program to cut air pollution. It's also the most concrete sign climate change is becoming a significant mainstream concern within the disparate oil and gas industry. Moves like this by trade groups represent the lowest, not highest, common denominator for positions within any given sector.
Between the lines: Don't expect climate change per se to be a big part of the Tuesday rollout or its website. The talking points are centered broadly on "the environment." Such rhetoric is in line with most Republicans and the Trump administration when it comes to climate change.