With help from Leah Nylen, Alex Guillén and Daniel Lippman
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— House Democrats all voted to advance the budget resolution that will launch the reconciliation process following a fraught two days of bitter intraparty fighting.
— The Interior Department is moving to have new federal oil and gas lease sales as soon as this fall while it continues to appeal a court order ending its pause on new leases.
— Several energy and water CEOs are at the White House today to partake in a cybersecurity discussion with President Joe Biden and his national security team.
HAPPY WEDNESDAY! I’m your host, Matthew Choi. Christina Baworowsky of ChargePoint gets the trivia for knowing Cairo had the first metro in Africa. For today: Where does Marjane move for high school in “Persepolis”? Send your tips and trivia answers to [email protected]. Find me on Twitter @matthewchoi2018.
Check out the POLITICO Energy podcast — all the energy and environmental politics and policy news you need to start your day, in just five minutes. Listen and subscribe for free at politico.com/energy-podcast. On today’s episode: The Corn in Biden’s side.
DEMOCRATS HAVE A DEAL: The House Democrats’ ideological standoff ended Tuesday, with the entire caucus voting to advance the budget framework that would kick start the reconciliation process for the party’s more partisan climate and social spending priorities. House Speaker Nancy Pelosi reached an agreement with the party’s centrists who’d held up the framework, setting a hard Sept. 27 date for the House to vote on the Senate-passed bipartisan infrastructure bill.
The centrists also pushed for a commitment from Democratic leadership that the House would work with their Senate counterparts to come up with a budget framework that both chambers could pass. That means negotiating with Sens. Joe Manchin (D-W.Va.) and Kyrsten Sinema (D-Ariz.), who have both expressed consternation about the $3.5 trillion scope of the budget framework.
“We’re not gonna vote on a measure that doesn’t have 51 votes in the Senate,” Rep. Jim Costa (D-Calif.), one of the moderate holdouts, said Tuesday.
With the two-day fireball intraparty negotiations out of the way, the House is now back in recess. But there’s still work to be done over the coming weeks for top Democrats in both chambers to craft a passable spending bill. POLITICO’s Heather Caygle, Sarah Ferris, Nicholas Wu and Anthony Adragna have more for Pros. Among those budget targets would be another $6 billion in additional funding for the priorities of the House Natural Resources Committee, with increases on fossil fuel production payments and fees helping cover the cost, according to a committee memo Pro’s Ben Lefebvre reports.
RELATED: “Anatomy of a power play: How 9 House Dems cut their deal with Pelosi,” from Sarah and Heather.
LEASING TO RECOMMENCE: The Interior Department is getting the ball rolling for federal oil and gas lease sales to resume, including one in the Gulf of Mexico as soon as this fall and a notice of sale for onshore leasing in December. The department is working to comply with a Louisiana federal court order calling for the resumption of lease sales while also appealing the ruling.
The department has been coming under attack over the leasing pause from Republicans, who say DOI has been dragging its feet in complying with the court’s order. Six Senate Energy Republicans wrote to President Joe Biden on Monday lambasting the lease pause as a vulnerability to foreign competitors (more on the letter later). But the department defended itself against the criticisms, saying in a Tuesday court filing that “over the last ten weeks, Interior has devoted more than 650 person-hours toward holding further proposed sales”.
Still, the department said it won’t be exactly the same as before and that DOI will take action to prevent any potential losses in revenue from private drilling on public land. “In complying with the district court’s injunction, the Interior Department will continue to exercise the authority and discretion provided under law to conduct leasing in a manner that fulfills Interior’s legal responsibilities, including to take into account the programs’ documented deficiencies,” the agency said in a press release announcing the start of the lease sale process. Ben has more for Pros.
Western Energy Alliance president Kathleen Sgamma trashed the announcement as just another prolongment of the pause, saying in a statement Tuesday night: “BLM shouldn’t be doing additional scoping and analysis, which are just stalling tactics. The parcels originally slated for the 2021 first and second quarter sales are scoped and ready to put on the calendar. The brief filed today with the court appears to show progress, but the slow walk indicates one step forward and three steps back.”
PREVENTING THE NEXT COLONIAL PIPELINE: Several energy and water CEOs are meeting at the White House today to discuss cybersecurity with Biden and members of his national security team. Duke Energy, PG&E, American Water, San Jose Water, Southern Company, Williams Companies and ConocoPhillips will be represented, according to an attendee list snagged by Pro’s Emily Birnbaum. The meeting will also include heads of major tech and banking firms, including Apple, JPMorgan Chase, IBM and Bank of America.
White House press secretary Jen Psaki announced the meeting back in July as the administration and Congress were taking stock of May’s cyberattack on the Colonial Pipeline. “The president felt it was important to use the White House as a forum for bringing together private sector leaders to have a discussion about both how we can work together and also what best practices are, which is including them taking — hardening their own cybersecurity protections and also what the U.S. government can do,” she said at the time.
GOP A HARD NO ON OPEC: Republicans on the Senate Energy Committee bashed Biden for asking for greater OPEC+ oil output in the midst of a hiatus on federal oil and gas leasing. The lawmakers wrote in a letter Monday that the administration’s request to OPEC and its allies earlier this month was at odds with both its stated climate goals and domestic policy, including halting the Keystone XL pipeline project and issuing the pause on new oil and gas leases.
“Your Administration’s request to OPEC+ will strengthen their economies, while weakening ours,” they wrote in a letter sent just before DOI announced new moves to resume lease sales. “We ask that your Administration cease making these ill-advised requests to the international energy community and immediately resume robust federal oil and gas leasing here at home.”
OPEC and its allies haven’t signaled that they’ll increase their output to alleviate domestic American political pressures, like rising gas prices. And Reuters reported earlier this month that the cartel doesn’t see a need to raise output beyond its plans at this time. The White House didn’t respond to ME’s request for comment.
LOBBYING MONEY IS POWER: As the oil and gas industry became dominated by fewer, bigger companies, those firms spent more on lobbying the federal government, according to new research out today by anti-monopoly group American Economic Liberties Project. The study takes a deep dive into the tech, pharmaceutical and oil and gas industries, looking at how the number of companies in the market impacts lobbying over time. (Fair warning for the less math-inclined: there are a lot of graphs and equations).
The results show a strong correlation between lobbying dollars and the concentration level, meaning that while the industry shrunk in terms of the number of companies, the amount of money spent to influence the government rose. Since 1998, oil and gas companies have spent nearly $2 billion dollars on federal lobbying, when adjusted for inflation. The industry comes in fifth place, spending $126 million in 2017.
Study author Reed Showalter, now of Kanter Law Group, the law firm started by Justice Department antitrust nominee Jonathan Kanter, acknowledged that lobbying in itself is not bad. “But as industries become more consolidated, they don’t spend resources on competing with each other. They turn their eyes to rent-seeking and government influence,” he said. “That’s not the goal of what we want businesses in America doing.”
DIGGERS DON’T DIG OIL AND GAS: A century of oil and gas development has significantly changed the Southwest landscape, and changes in how the Interior Department leases and regulates extraction are necessary to protect archaeological and cultural sites, the nonprofit group Archaeology Southwest argues in a new report. While individual sites are easier to protect, “it is the larger, connected ancient and historic landscapes that are some of the most significant—and at-risk—resources on our public lands,” wrote archaeologist Paul F. Reed, a longtime critic of oil and gas development’s archaeological impacts in Chaco Canyon.
Recommendations include: Proactively removing sensitive areas from leasing zones before sales; review previously leased lands for “enhanced rehabilitation”; “meaningfully consult” with tribes earlier in the process and truly hear their concerns; and develop new guidelines that consider holistic preservation analyses of “soundscapes and viewsheds.” Reed said he is “optimistic” that many of these issues will be addressed in the Biden administration’s forthcoming review of the program.
Coming soon? Brian Vallo, governor of the Pueblo of Acoma, told reporters on Tuesday that a meeting is being planned between tribal leaders and the Biden administration “and this will likely be one of those central issues that will be discussed during this gathering.”
GARDEN STATE’S GAS STATUS: The New Jersey gas tax will decrease 8.3 cents in October, following a formula put in place under former Gov. Chris Christie. The lowered tax will offer some relief for Gov. Phil Murphy as he seeks reelection, with any increase in taxes likely to have been folded into attacks against him, POLITICO’s Ry Rivard reports.
An annually adjusted gas tax in the state increased last year due to a dramatic reduction in cars on roads due to the pandemic. But state Treasurer Elizabeth Maher Muoio said last year’s increase was based on projections that were worse than expected, allowing the tax this year to go down.
ALSO IN JERSEY: The state’s League of Conservation Voters chapter is pushing for buildings in the state not to have natural gas hookups, with a proposal for all new commercial and residential buildings to be 100 percent electric by 2030. That would mean no more gas stoves, heaters or any other gas appliances. The league is making their case at a press conference in Trenton where it will outline its policy recommendations for electrifying the state’s buildings. Ry has more for Pros.
NO, I WILL NOT SHUT UP: Ukrainian Foreign Minister Dmytro Kuleba “will never shut up on Nord Stream 2,” he told POLITICO Europe’s David Herszenhorn. The country’s administration remains bitter over the German-American deal on the pipeline that was announced without input from Kyiv, and Kuleba told David that he and his colleagues “firmly believe” talks between Ukrainian Energy Minister Herman Halushchenko, Germany Economic Affairs and Energy Minister Peter Altmaier and Energy Secretary Jennifer Granholm should have taken place months ago before the German-American announcement. Still, he acknowledged the talks were useful in sorting out differences ahead of direct negotiations with Russia to ensure Ukrainian transit revenues past 2024. Read more from David.
A related read from Germany: “German election a toss-up as Merkel’s center-right fades,” via POLITICO Europe’s Matthew Karnitschnig. AND “Armin Laschet warns lofty green targets threaten ‘social peace’,” via POLITICO Europe’s Hans von der Burchard.
BREAKING RECORDS: 2021 has so far had a record number of clean power installations, according to a report by the American Clean Power Association, with more than 180 gigawatts of operating clean power capacity in the country. More than 9,915 megawatts were added in the first half of the year — a 17 percent increase compared to the same period in 2020. Kelsey Tamborrino has more for Pros.
— Chuck Cunningham is now working on policy and legislation focusing on Southeastern states for Hunter Nation. He was special adviser in the office of congressional and intergovernmental affairs at the Department of Energy in the Trump administration and was the longest serving top federal lobbyist for the National Rifle Association and also their top state lobbyist.
— “Venezuela swapped PDVSA oil for food, then punished the dealmakers,” via Reuters.
— “The Cotton Tote Crisis,” via The New York Times.
— “Fossil leaves may reveal climate in last era of dinosaurs,” via The Associated Press.
THAT’S ALL FOR ME!