Senate Passes First Comprehensive Energy Bill Since 2007

On Wednesday of last week, the Senate overwhelmingly approved the first major energy bill in nearly a decade. The bill, entitled the Energy Policy Modernization Act, passed 85 to 12 with bipartisan support and includes measures to expand renewable energy and to modernize energy infrastructure.


Among other things, the Energy Policy Modernization Act will expedite the federal permitting process for new pipelines and for exporting natural gas and includes a number of plans to increase energy efficiency. The bill also includes measures to encourage clean coal technology and grow public-private partnerships to develop advanced nuclear technologies. Significantly, it also attempts to protect the electric grid from extreme weather and from cyber attacks. Also included are measures aimed at increasing the export of liquified natural gas (LNG), allowing European nations to decrease their dependence on Russia for natural gas.

‘‘Moving forward with this act will help America produce more energy, help Americans save more money, and bring us one step closer to becoming a global energy superpower,’’ says Senator Lisa Murkowski, an Alaska Republican and chairwoman of the Senate Energy and Natural Resources Committee.

A similar bill passed the U.S. House in December, but the White House disagreed with portions of that bill, including expedited oil exports, and threatened a veto. Congress now plans to combine the two bills. It is unclear at the moment whether the president will sign the legislation into law.

Last year, Congress lifted the U.S. ban on oil exports and extended solar and wind power tax credits. Those relatively controversial energy policies were off the table for this piece of legislation, clearing the path for lawmakers to move forward with less contentious policy changes. After all, passing an energy bill was critical; the last major energy bill was passed by Congress in 2007. The U.S. energy landscape has changed drastically since then.

For example, thanks to advanced drilling techniques, American oil production has increased by nearly 80% and domestic natural gas production has increased by around 30% over the past nine years. The U.S. is now a world leader in oil and gas production.  Renewable energy is also growing. The U.S. Energy Information Administration says renewables will grow by 9% over the next year and currently account for 13% of the U.S. energy mix.

If the president does sign the new energy bill into law, it could have a pronounced impact on several sectors of the energy marketplace.

“The progress is a small positive for LNG [liquefied natural gas] projects still hoping to win approval, because it would require expedited LNG project consideration,” says a research note by analysts at FBR & Co. “The bill also contains numerous energy efficiency and energy storage provisions that individually do not appear to represent a significant shift in policy but collectively could benefit larger companies.”

While the bill has garnered support in some circles, it has received opposition in others. Some conservative groups say the bill continues a heavy-handed government approach toward energy policy. Others, such as the nation’s largest environmental group, the Sierra Club, claim the bill undermines the Clean Power Plan.

“As Congress continues to fine tune the Energy Policy Modernization Act, PACE will continue to monitor the bill for potential impacts on energy customers and state policies,” says PACE Executive Director Lance Brown. “It is a significant development to have the first comprehensive energy bill since 2007 and we look forward to examining it more closely.”


TVA and Private Partner to Build Largest Solar Farm in TN History

According to information released by Tennessee Valley Authority (TVA) officials, the utility is poised to help develop a 53-megawatt solar project housed at Naval Support Activity Mid-South in Millington, Tennessee. When complete, the large-scale solar project will provide enough electricity to power more than 7,500 homes. Spanning more than 400 acres and using more than half-a-million solar panels, it will also be the largest solar project ever built in Tennessee.


The solar project is part of a long-term power-purchase agreement with Nashville-based Silicon Ranch Corporation, one of the top fifteen solar owner-operators in the U.S. According to TVA officials, it will provide power to the utility’s customers at cost-competitive rates for the next twenty years. It will also help satisfy TVA’s commitment to pursue renewable projects within its own service territory.

“TVA is committed to providing renewable energy in a way that best serves our local power company customers and the more than nine million people of the Tennessee Valley,” said Van Wardlaw, TVA Executive Vice President of External Relations. “This solar project supports our commitment to a diversified and cleaner energy portfolio, which includes energy efficiency and competitively priced renewable energy.”

Similar to projects recently announced in Alabama that bring together electric utilities and military installations, the Tennessee project is a collaborative effort between the private developer, Silicon Ranch, and partners such as TVA and the Department of the Navy. When complete, it will help fulfill the Department of the Navy’s “One Gigawatt” initiative to enhance energy security and resiliency on military bases. Construction and development will cost an estimated $100 million, with Silicon Ranch owning and operating the facility over the twenty-year life of the agreement.

When it comes to solar deployment, PACE has argued that large-scale projects provide inherent advantages to residential applications. We have applauded a number of large-scale projects across the Southeast as examples of responsible collaborations between regulators, utilities, private partners, and communities.

“This announcement by TVA shows a clear commitment to not only bringing their customers more renewables, but deploying those renewables within the Valley,” remarked PACE Executive Director Lance Brown, who is serving his second term on TVA’s Regional Energy Resource Council. “This type of large-scale project, in collaboration with multiple partners, represents a responsible, smart approach to solar.”

For their part, local economic development officials such as those at the Millington Industrial Development Board are also pleased to see TVA’s large-scale solar project developed in the region.

“NSA Mid-South provides an annual economic impact of over $330 million to this area. We are grateful to TVA and to Silicon Ranch for bringing a clean renewable energy source to Millington,” said Millington Industrial Development Board Chair Carey Parham. “It not only supports this critical naval base, but it also sends a strong signal to the business community that Millington is a great place to locate their operations and that the MIDB is innovative and creative in working on important economic development projects.”


Democratic Governor Pushing Back on EPA Ozone Rule

According to recent reporting from Chris White of The Daily Caller, Colorado Governor John Hickenlooper wants the Environmental Protection Agency to pump the brakes on its new ozone regulations. That is significant, since Hickenlooper is a Democrat from a swing state.


Late last year, EPA lowered the acceptable threshold for ground-level ozone from 75 parts per billion to 70 parts per billion. PACE has continued to follow the EPA’s efforts to further restrict ozone emissions. In January, we reported that groups such as the National Association of Manufacturers and the U.S. Chamber of Commerce filed suit against EPA over the rule.

“I think it would be a great idea if they suspended the standard,” Gov. John Hickenlooper said Thursday during a meeting in Denver. “I mean, just with the background [ozone emissions], if you’re not going to be able to conform to a standard like this, you are leaving the risk or the possibility that there will be penalties of one sort or another that come from your lack of compliance.”

Many are concerned that EPA’s new ozone standard could hurt the manufacturing and transportation sectors. Officials in California, for example, are particularly concerned that simultaneously complying with EPA ozone rules and greenhouse gas rules could require a total overhaul of the state’s transportation sector within the next 20 years.

“We have to go to zero tailpipe emissions,” Mark Z. Jacobson, professor of environmental engineering at Stanford University, told the Los Angeles Times. “There’s really no other solution.”

Meanwhile, local government officials in other regions of the country are also worried about the impact of the new rule. Tucker Dorsey, a county commissioner from Baldwin County, Alabama, has expressed concern that some local areas, such as his county, have very little control over ozone levels, yet remain in jeopardy of federal penalties. Dorsey laid out those concerns in a guest blog in December of 2014 when EPA was still considering changes to the ozone standard.

Governor Hickenlooper’s remarks on ozone could be a harbinger of future dissent from other elected officials. Like some other governors, Hickenlooper has attempted to navigate between his party’s anti-fossil fuel positions and his state’s significant oil and gas economy. The recent boom in oil and gas production nationwide, as well as the jobs and cost savings brought to energy consumers, has only made it more difficult for governors to support positions that could restrain the energy economy.

“When the Democratic governor of a swing state sounds the alarm, you know there must be something really wrong with the Obama EPA’s new ozone cap,” Simon Lomax, energy analyst at the Colorado-based Independence Institute, told The Daily Caller News Foundation.