Departmental Notices

One proposal is out; another stirs the pot

Two major announcements came from the U.S. government within the past week that could have potential consequences for the energy sector. Last Thursday (January 4), the Department of the Interior announced a proposal for offshore drilling that has been bombarded with criticism in the ensuing week since. This Monday (1/8), the Federal Energy Regulatory Council rejected the Notice of Proposed Rulemaking filed back in September by the Department of Energy that would have backed funding for coal and nuclear plants.

DOI drafts offshore proposal. U.S. Secretary of the Interior Ryan Zinke announced January 4 a proposal for developing the National Outer Continental Shelf Oil and Gas Leasing Program (National OCS Program) for 2019-2024. The DOI proposal boldly projected to “make over” 90 percent of the total OCS acreage and more than 98 percent of “undiscovered, technically recoverable oil and gas resources in federal offshore areas available to consider for future exploration and development.” By comparison, the current program puts 94 percent of the OCS off-limits. In addition, the program proposes the largest number of lease sales in U.S. history. Earlier this year, 155 Members of both the House and the Senate sent letters to Secretary Zinke in support of a new 5-year plan that “recognizes America’s potential for energy dominance.” The Draft Proposed Program (DPP) includes 47 potential lease sales in 25 of the 26 planning areas – 19 sales off the coast of Alaska, 7 in the Pacific Region, 12 in the Gulf of Mexico, and 9 in the Atlantic Region. The proposal has been met with staunch opposition in some places, including a requested meeting with Zinke from Delaware’s governor today. Opponents say the proposal greatly threatens the environments and economies of certain coastal states.

DOE NOPR rejected by FERC. After being in limbo for nearly half a year, the Department of Energy’s push for coal and nuclear compensation appears to finally be over. FERC rejected the DOE’s Notice of Proposed Rulemaking (NOPR) on Monday, which would have provided monetary assistance for power plants that keep 90 days worth of fuel onsite. Instead, FERC requested that regional grid operators review a questionnaire about improving power system resilience and report back within 60 days. In its September letter announcing the NOPR, the DOE argued that the expected retirement of coal and nuclear plants in the nation’s wholesale power markets could put the U.S. power supply at risk. FERC, however, said the agency and supporters of the rule failed to prove that to the commission, according to Utility Dive.

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