With less than twenty-one days legislative days remaining until the onset of Fiscal Year 2014, and no fiscal bills yet ready for the President’s signature, the Senate could find itself mired in even more partisanship with Majority Leader Reid (D-NV) potentially expected to invoke a Senate procedure—also known as the nuclear option—to modify the 60-vote threshold to advance executive branch nominees. If invoked and successful, only 51 votes would be required to approve nominees. Republicans, claiming concern regarding spillover effects on vote thresholds for judicial nominations and later legislation, have not responded well to this potential action.
Intertwined, although not the reason for the Senate procedure controversy, is the nomination of the EPA Administrator. As reported in Sidley’s previous Washington Energy Update, Gina McCarthy’s nomination will be considered, and likely approved. Senator Vitter (R-LA), senior Republican on the Environment and Public Works Committee (EPW), who had significant concerns regarding her nomination and remained dissatisfied with the Agency’s response to his concerns regarding EPA’s transparency, this past week indicated that he would oppose a filibuster on her nomination, after confirming that his various requests had been sufficiently satisfied. Alternatively, Senator Blunt (R-MO) continues to keep his hold on McCarthy’s nomination pending the release of the St. John’s Bayou-New Madrid Floodway Project draft environmental impact statement (EIS) that has been at the center of Blunt’s hold on McCarthy’s nomination.
In other nominee related news, three other EPA nominees—Avi Garbow, nominee to head the EPA office of General Counsel; Jim Jones, nominee to run the Office of Chemical Safety and Pollution Prevention; and Ken Kopocis, nominee to head the EPA Office of Water—will come before the EPW Committee on July 23, 2013 for their confirmation hearings. Of the three, Kopocis’s nomination is likely to remain the most controversial given a previous hold on him (he was first nominated in the 112th Congress) as a result of controversy surrounding certain Administration water policies. Separately, a confirmation hearing date before the Senate Energy and Natural Resources Committee is being negotiated for Ron Binz, former Colorado Public Utilities Commission Chairman, who was recently nominated to serve as Chair of the Federal Energy Regulatory Commission.
Re-Proposed New Source Performance Standard (NSPS) for New Facilities Sent to OMB; Option Selection on NSPS for Existing Facilities is Imminent
On July 1, 2013, EPA transmitted to the Office of Management and Budget (OMB) its re-proposal to regulate carbon emission standards for new facilities. The issuance of the re-proposal to OMB came less than a week after the issuance of President Obama’s “Power Sector Carbon Pollution Standards Memorandum,” which directed EPA to issue a new proposal for carbon emissions standards for new power plants under the Clean Air Act Section 111 NSPS program by September 20, 2013, and to issue a final rule “in a timely fashion.” As we reported in The Obama Climate Change Action Plan: Five Things You Need to Know, sources suspected that the re-proposal would include separate standards for coal-fired utilities and natural gas-fired utilities. The initial proposal combined the coal and natural gas sectors and required a standard of 1,000 pounds of carbon dioxide per megawatt hour – essentially the natural gas carbon dioxide emission profile. Heather Zichal, Deputy Assistant to the President for Energy and Climate Change, confirmed the separate standard speculation last week when she met with Senate Democrats and informed them of the separate standard approach, which compared to the previous proposal is anticipated to be more lenient on greenhouse gas coal plant requirements, while possibly making the standard more stringent for natural gas facilities. Still unclear is the level at which the new, separate standards will be set.
The President also directed EPA to propose carbon emission “standards, regulations, or guidelines” for emissions from existing, modified, and reconstructed power plants by June 1, 2014 and to finalize the guidelines by June 2015. Sources indicate that in order to meet this aggressive schedule, Agency staff could present the EPA Administrator with options from which the Administrator will ultimately make a selection for a potential standard, a process otherwise known as option selection, in late September or early to mid-October.
On a related note, senior EPW Republican Vitter and the panel’s other Republicans asked EPW Chair Boxer (D-CA) to invite to testify various applicable government officials at her upcoming climate change hearing so as to allow for “congressional oversight of federal policy decisions related to those attempts at controlling the climate.” As anticipated, Boxer will oversee an EPW hearing entitled “Climate Change: It’s Happening Now” on July 18, 2013.
Other Items of Interest:
- House Energy and Commerce Committee Releases 5th and Final RFS White Paper: As part of its continued bi-partisan approach to review the Renewable Fuel Standard (RFS), the House Energy and Commerce (E&C) Committee released its final White Paper focused on RFS implementation. Comments are due on the White Paper on July 26, 2013. On a related note, the Committee is expected to hold a hearing regarding the RFS the week of July 22, 2013 with various impacted stakeholders invited to testify. Much of the hearing focus will be on “blend wall” concerns. Further, insiders anticipate E&C Committee RFS related legislation could be crafted as early as August during the congressional recess.
- House Still Anticipated to Consider Coal Ash Legislation in July; Senate Unlikely to Unveil its Version during this Work Period: Consideration on the House floor of the Coal Residuals Reuse and Management Act (H.R. 2218) could come as early as next week. Designed to pre-empt EPA’s authority to regulate coal ash by setting minimum federal standards and allowing states to develop a permit program, the bill is expected to clear the House. Passage of a similar bill in the Democratic-controlled Senate remains an open question. Senate sponsors are being urged to re-draft legislation to address some of their colleagues’ concerns. The bill is unlikely to be released before the end of the July work period.
- Revised Offshore Revenue Sharing Bill Introduced; Hearing Scheduled for July 23, 2013: Senators Murkowski (R-AK) and Landrieu (D-LA) have introduced revised legislation (S.1273) regarding offshore revenue sharing. Their original bill, S. 630, raised concerns regarding its budget impacts. Similar to S. 630, the bill would transfer up to 37.5 percent of revenue from offshore energy production—including fossil fuel and renewable energy projects—from federal waters to coastal state treasuries. Under the proposed measure, Gulf of Mexico areas currently eligible to initiate revenue sharing in fiscal year 2017 from oil and gas drilling are not included. Further, the bill would not be applicable to leases already in place upon enactment of the system. The bill does not include offsets.
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