Overnight Energy & Environment

Energy & Environment — Interior punts on offshore drilling plan

by Rachel Frazin and Zack Budryk 07/01/22 07:17 PM ET

The Biden administration has released its proposed five-year offshore drilling plan … sort of. We’ll dive into the details.

Plus: The Supreme Court gives Senate Democratic leader Charles Schumer renewed urgency on climate and former EPA head Andrew Wheeler has a new position.

This is Overnight Energy & Environment, your source for the latest news focused on energy, the environment and beyond. For The Hill, we’re Rachel Frazin and Zack Budryk. Subscribe here.

Interior proposes 0-11 offshore sales

The Biden administration is punting a decision on whether to open up more lease sales for offshore drilling.

In a statement issued Friday, the administration said it is still working on a plan, and that when issued it could include as many as 11 specific lease sales for offshore oil and gas drilling or as few as zero.
An Interior Department official said equal weight is being given to scenarios with zero sales, some sales or all 11 sales.

The statement and department’s proposal for the program’s future was issued one day after a previous five-year offshore drilling plan expired. That plan had been launched by the Obama administration.

The sales under consideration include an area in the Cook Inlet near Alaska, and as many as 10 sales in the Gulf of Mexico. Earlier this year, the department canceled a planned lease sale in Cook Inlet, citing lack of industry interest.

The political context: The move comes as the administration grapples with the politics of high gas prices, which recently reached as high as $5 per gallon nationally.

It also follows a major Supreme Court decision curbing the Environmental Protection Agency’s powers to regulate climate contributions of power plants.
And it comes as Democrats are still trying to sell their social and climate agenda to swing vote Sen. Joe Manchin (D-W.Va.), who is generally supportive of fossil fuels.

Manchin, in a statement, said he was “pleased” that the department released its proposal, but “disappointed” that the zero-sale option is being considered.

The Interior official defended not deciding on a specific number of lease sales at this stage, saying it intended to put a range of options before the American people.

The actual possible schedule: The department on Friday released a schedule accompanying its proposed plan, saying the first lease sale could take place in 2023.

Of the remaining ten potential sales, as many as two could take place in 2024, two could take place in 2025, three — including the Alaska sale — could take place in 2026, two could be in 2027 and one could be in 2028.

Ruling puts pressure on Schumer to get climate deal

The Supreme Court’s decision Thursday to dramatically limit the Environmental Protection Agency’s (EPA) authority to regulate the greenhouse gas emissions of power plants puts new pressure on Senate Majority Leader Charles Schumer (D-N.Y.) to strike a climate deal with Sen. Joe Manchin (D-W.Va.).

The conservative court’s 6-3 decision in West Virginia v. EPA strikes a blow to President Biden’s climate agenda and has Democrats and activists scrambling to salvage Biden’s pledge to reduce greenhouse gas pollution by 50 percent by 2030.
The setback places renewed importance on Schumer’s efforts to revive a budget reconciliation bill that would include climate provisions such as clean energy tax credits and incentives for cutting methane emissions.

“This devastating decision is only the latest shot in the arm to Congress to legislate action on climate,” said Melinda Pierce, the legislative director of the Sierra Club. “Today’s Supreme Court decision is stark reminder that the clock is ticking and Congress and must act.”

So what does he have to say? Schumer on Thursday said the court’s decision lights a fire under Congress to get something done to limit carbon emissions.

“Make no mistake — the consequences of this decision will ripple across the entire federal government, from the regulation of food and drugs to our nation’s health care system, all of which will put American lives at risk, making it all the more imperative that Democrats soon pass meaningful legislation to address the climate crisis,” he said in a statement responding to the opinion penned by Chief Justice John Roberts.

Many Democratic lawmakers have become pessimistic about getting Manchin to agree to any budget reconciliation deal that would include provisions to significantly reduce carbon emissions.

Signs of life: Schumer is continuing to negotiate with Manchin, and there are some signs of progress.

The Washington Post reported Wednesday that Democratic leaders have finalized a proposal to lower the price of prescription drugs for seniors, which would be a core element of the budget reconciliation package.
This development puts Schumer and Manchin in position to negotiate the other pillars of the reconciliation package: tax reform and climate provisions.

Schumer’s and Manchin’s staffs have continued to negotiate over the two-week July 4 recess, leaving some Democrats optimistic of getting a deal in July or early August.

EX-TRUMP CABINET MEMBER HEADS TO VIRGINIA DEREGULATION OFFICE

Virginia Gov. Glenn Youngkin (R) on Friday appointed former Environmental Protection Agency head Andrew Wheeler to a newly created Office of Regulatory Management, months after state lawmakers voted Wheeler down for another role.

Wheeler will head the new office, which Youngkin said in a statement will aim to reduce state regulatory requirements by 25 percent.
The Trump administration implemented a similar policy in 2017, imposing a requirement that any new regulations be accompanied by the repeal of two existing regulations.

“Last year, I pledged to Virginians that we would remove 25% of the regulatory requirements in the Commonwealth,” Youngkin said in a statement Friday.

“In the spirit of this objective, we have created the Office of Regulatory Management, led by Andrew Wheeler, which will create much needed transparency and efficiency in Virginia’s regulatory process to ensure that we have a government that works for the citizens of the Commonwealth.”

Wheeler, who served as EPA administrator from 2019 to 2021, was initially Youngkin’s nominee as Virginia’s secretary of natural resources.

His nomination immediately faced pushback in the Democratic-majority state Senate, due to his history with the Trump administration and as a coal industry lobbyist.

A spokesman for Youngkin’s office told The Hill that Wheeler will not require General Assembly confirmation as head of the new office.