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TRUMP’S VISIT TO PETROCHEMICAL PLANT SHOWS A DEMOCRATIC ‘BLIND SPOT’ ON FOSSIL FUELS: President Trump is touring a petrochemical plant in western Pennsylvania Tuesday afternoon to tout booming U.S. energy production and its ties to the economy of a swing state whose Democratic leadership is more embracing of fossil fuels than the national party.
While no one can guess how Trump will focus his visit, his allies say he has the opportunity to make the case for the growing demand for oil and gas for petrochemicals used in plastics, fertilizers, clothing, digital devices, and other everyday products, and how that contrasts with pledges from Democratic presidential candidates to phase out fossil fuels.
“There is such a contrast for the president going out to celebrate the fact that petrochemicals are the building blocks of modern day life, versus the Democrats who want to shut that industry down,” said Mandy Gunasekara, a former senior EPA official in the Trump administration who now runs the Energy 45 Fund, a nonprofit organization supporting the president’s energy agenda.
“It’s within the strategy of the Democrats to go after these plants because of their demand for fossil-based energy to do what they do,” Gunasekara told me in an interview.
Demand for petrochemicals is booming: Petrochemicals derived from oil and gas are becoming the largest drivers of global oil demand, the International Energy Agency said in a report last year, outpacing demand from cars, planes and trucks. IEA projects that petrochemicals will account for more than a third of oil demand growth over the next decade, and nearly half of growth through 2050. Petrochemicals could consume an additional 56 billion cubic meters of natural gas by 2030, and 83 bcm by 2050, IEA said.
The U.S. is poised to be a major part of serving that demand growth. It has become a low-cost location for chemicals production thanks to the shale gas revolution and is now home to around 40% of the global ethane-based petrochemical production capacity.
Production of ethane, a byproduct of natural gas that can be made into polyethylene, a form of plastic, is projected to increase more than 20 times by the year 2025, according to the Department of Energy.
Petrochemicals also have a role in the clean energy transition: That is because of their presence in materials used to manufacture solar panels, wind turbines, batteries, and electric vehicles.
“Petrochemicals are one of the key blind spots in the global energy debate, especially given the influence they will exert on future energy trends,” said Fatih Birol, the IEA’s executive director.
Shell, the European oil and gas giant that is building the Pennsylvania Petrochemicals Complex that Trump is visiting, says some of the plastic produced at the plant can be used to create fuel-efficient vehicles.
The plant will convert natural gas produced in the Marcellus and Utica shale regions into plastic to be used in the manufacturing of consumer products. It is one of more than a dozen petrochemical plants that are being built, or have been proposed, across the world, according to the New York Times. That includes several across Ohio, West Virginia, and Pennsylvania, as the Trump administration works with state regulators to build the country’s first natural gas and petrochemical hub in Appalachia.
The politics of petrochemical growth: But oil and gas companies have been getting in the petrochemical business before Trump took office. Shell approved the Pennsylvania plant in the Obama administration, when the growth of oil and gas production began. The U.S. has continued on that path under Trump, becoming the world’s largest combined producer of oil and natural gas.
“Trump is trying to claim credit in swing states like Pennsylvania for the shale boom which actually began and peaked under Obama,” Paul Bledsoe, a strategic adviser at the Progressive Policy Institute, and former Clinton White House climate change advisor, told me.
Bledsoe, however, said Trump could potentially exploit national Democrats’ aggressive plans to phase out fossil fuels by playing up the continued demand for natural gas and petrochemicals.
“Democrats would be smart to recognize that shale gas will continue to be an important part of the energy economy for many years in Pennsylvania and Ohio, even as the clean energy jobs in wind, solar and electric vehicles also surge in those states,” he said.
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DEMOCRATS STRUGGLING TO FACE FACT THEIR PLANS WOULD ALL BUT END FOSSIL FUELS: Most Democratic presidential candidates running for president have rallied around a shared goal: cutting greenhouse gas emissions to net-zero by 2050.
However, few candidates appear to appreciate the ambition of that target, or explicitly say that it would necessitate almost entirely ending the use of fossil fuels such as coal, oil, and gas. Fossil fuels — petroleum, natural gas, and coal — accounted for 80% of U.S. total energy consumption in 2018, according to the Energy Information Administration.
“Getting to net-zero by 2050, which some people try to diminish, will take a herculean effort and will require a reorganization of our energy economy in ways never imagined before,” John Delaney, a presidential candidate and former congressman from Maryland, told me.
Although many Democrats have embraced the goal of net-zero, few have outlined policy prescriptions for reaching the goal, or mentioned how they would get Americans to stop using fossil fuels.
Contrasts between plans: The exception to the rule is Jay Inslee, who has offered a comprehensive plan for ending the use of fossil fuels, which includes more immediate, specific goals of eliminating coal by 2030 and having fossil fuel-free electricity by 2035. His agenda includes working with Congress to ban the technique of fracking for natural gas, and rejecting new fossil fuel infrastructure such as pipelines.
Inslee, the governor of Washington state, accused front-runner Joe Biden during last month’s presidential debate of not sufficiently committing to eliminate fossil fuels from the U.S. economy.
Most candidates, including Biden, have also vowed to ban new oil and gas drilling leases on public lands — nearly a quarter of U.S. greenhouse emissions come from energy production on public lands. But they leave the door open for fossil fuel use more broadly, with some candidates specifically mentioning carbon capture as an important technology during the clean energy transition.
Read more in this week’s Washington Examiner magazine.
DEMOCRATIC STATES TO SUE TRUMP FOR ‘EVISCERATING’ ENDANGERED SPECIES ACT: Democratic states promised Monday to sue the Trump administration for its move to “eviscerate” the Endangered Species Act by modifying how the federal government implements the law in a manner more accommodating to businesses.
Democratic Attorneys General Xavier Becerra of California and Maura Healey of Massachusetts said they would file a lawsuit, along with “many” other states, in the coming weeks.
“This is another attempt by the Trump administration to end-run existing law and find a way to eviscerate it through rulemaking,” Healey told reporters on a press call. “These new rules are misguided, they are dangerous, and they are illegal.”
The states are basing their lawsuit on three allegations, Healey said: The administration acted “arbitrarily” by not adequately considering science, it failed to properly absorb public comment, and the changes violate the text and purpose of the statute to protect vulnerable species from extinction.
Environmental groups are also planning to sue: “This administration’s attempt to twist and reinterpret the law in ways that are illegal completely violates the spirit and intent of the law itself,” Jamie Clark, president and CEO of the Defenders of Wildlife, said on the press call. “Regulations cannot change law. Only Congress can.”
Industry groups supportive of the changes said Democratic states are overreacting.
“Everybody knows how hard it is to change anything related to Endangered Species Act because of the demagoguery surrounding it,” Kathleen Sgamma, president of the Western Energy Alliance, told me. “You try to do anything to make ESA work more practically and you would think someone is out there shooting polar bears.”
Read more about what the Trump administration is changing about the law here.
SOLAR PANEL IMPORTS PARTIALLY RECOVER AFTER TRUMP TARIFFS: The U.S. imported an average of 644,000 kilowatts of solar panels per month in the first four months of 2019, an increase compared to the level after Trump imposed tariffs on imported solar panels.
Solar panel imports had fallen to 300,000 kilowatts per month in the months following Trump’s imposition of tariffs on solar panels in early 2018, according to data released Tuesday by the Energy Information Administration.
The EIA said continued decline in the cost of solar PV modules may have offset some of the effects of the solar tariffs.
But that higher number of imports in early 2019 is still lower than the level of solar panel imports in mid-2017, before the tariffs were announced, when they were at more than 1,000 kilowatts per month.
In January 2018, Trump imposed a 30% tariff on imported solar panels as part of his trade agenda to target cheap products made by China and other Asian countries. The tariffs, to be levied over four years, are for 30% in the first year, 25% in the second, 20% in the third, and 15% in the fourth year.
BUTTIGIEG BACKS BIOFUEL INDUSTRY AGAINST REFINERY EXEMPTIONS TO RFS: Presidential candidate Pete Buttigieg is pledging to stop the “abuse” of small refinery exemptions to the Renewable Fuel Standard, a process that he says has been excessively used under the Trump administration to the detriment of U.S. farmers.
Buttigieg, the mayor of South Bend, Indiana, said he plans to side with biofuels and “rural America” by supporting the RFS “as written.”
“Pete will stop the abuse of small refinery exemptions established by the current administration, which allows fossil fuel giants to skirt their obligations to blend biofuels,” his campaign said Tuesday, as part of a plan he released on “unleashing the potential of rural America.”
Corn farmers and their representatives in Congress have accused the Trump administration of excessive use of the refinery exemptions, which they argue are eroding the market for ethanol.
The Environmental Protection Agency said Friday that it exempted 31 oil refineries from 2018 requirements to use renewable fuel, while denying six applications — the first time the Trump administration denied small refiner exemption applications under the RFS.
Buttigieg, like other candidates, also calls for empowering rural communities to help combat climate change, by supporting R&D into soil carbon sequestration, providing incentives for farmers to conserve their land, and providing “resilience” grants to communities to help them prepare for climate-fueled weather disasters.
CLIMATE COMMITTEE REPUBLICANS HIRE ANALYST WHO CO-WROTE DISPUTED GREEN NEW DEAL STUDY: An analyst who co-authored a disputed study finding the Green New Deal would cost trillions of dollars is joining the Republican staff of the House’s climate change committee.
Philip Rossetti will work for Republicans on the Select Climate Crisis Committee, led by ranking member Garret Graves of Louisiana, as a fellow focused on energy and climate policy.
Rossetti was the director of energy policy at American Action Forum, a center-right group led by Douglas Holtz-Eakin, the former director of the nonpartisan Congressional Budget Office.
Rossetti contributed to a study released by the think tank in February that claimed the bulk of the cost of the Green New Deal would come from its call for a federal job guarantee and universal healthcare.
Republicans in Congress quickly used the report as evidence of the Green New Deal being an overly expensive and broad method to combat climate change.
But Holtz-Eakin later said the often cited cost figure from the report — $93 trillion — did not actually appear anywhere in the text.
“Is it billions or trillions?” Holtz-Eakin told Politico. “Any precision past that is illusory.”
Democrats say the report was misleading because it focused on the social proposals of the Green New Deal rather than the costs of transitioning to carbon-free power and transportation.
The Rundown
Houston Chronicle As Trump spars with China, future of huge market for US energy falls into doubt
Vox Colorado’s most powerful climate tool isn’t what you think
S&P Global As states continue 100% clean energy push, regional complexities await
Bloomberg Sweltering Texas is the most expensive place to buy power in America
New York Times Saudi Aramco says it’s ‘ready’ for IPO as it reports half-year earnings
Calendar
WEDNESDAY | August 14
American Wind Week 2019 continues, lasting through Aug. 17. During Wind Week, the American Wind Energy Association and supporters of wind energy highlight the “many ways that wind powers opportunity” at dozens of events across the country and online with #AmericanWindWeek.
