Trump, Cabinet Members Tout Energy Policy at DOE; White House to Nominate Richard Glick to FERC

President Donald Trump on June 29, announced energy policy initiatives at a Department of Energy (DOE) event, with few details and a lot of enthusiasm for ending the war on coal and regulatory reforms to usher in a new period of using domestic energy resources to their full potential.

“The golden era of American energy is now underway,” Trump said at the DOE event. He emphasized how his administration is aiding exploration and production of fossil fuels, saying “we’re putting coal miners back to work” with a new coal mine opening in Pennsylvania, allowing more energy exports to foreign countries and “I’m dramatically reducing restrictions on the development of natural gas.”

His speech marked one of the few times a president and multiple cabinet members spoke at DOE, as Trump, Vice President Mike Pence, and three cabinet members emphasized the growing role American energy resources play in boosting the domestic economy and meeting energy demand in other countries.

DOE Secretary Rick Perry, Secretary of the Interior Department Ryan Zinke, Environmental Protection Agency Administrator Scott Pruitt, and Gary Cohn, director of the National Economic Council, discussed the importance of having low-cost energy resources in the U.S. drive job growth, aid domestic manufacturing, and provide energy security for global trading partners.

Trump echoed some of what Pence, Perry, and others said about how other countries have used their energy resources as an economic weapon and the U.S. previously was not in a position of strength. With the shale oil and gas revolution however, the U.S. has nearly 100 years’ worth of natural gas and “we’re really in the driver’s seat” to sell domestic energy resources all around the world. “We’ll seek not only energy independence but energy dominance,” he said.

“Today I’m proudly announcing six brand new initiatives to propel this new era of American energy dominance,” Trump said, but several of them have no details other than what was said in the speech, such as approving construction of a new petroleum pipeline to Mexico and a revival of the nuclear energy sector. The new oil pipeline “will go right under the wall, right?” he joked, in reference to the border wall with Mexico that he has promoted.

Regarding the nuclear revival, he said “a complete review of U.S. nuclear energy policy will help us find new ways to revitalize this crucial energy resource.”

Two other initiatives involve Sempra Energy signing an agreement to begin negotiations to sell more natural gas to South Korea – with Trump noting that South Korean officials are visiting the White House later on June 29 – and having the Treasury Department address barriers to financing coal-fired power plants overseas so that U.S. coal exports can be increased.

Another initiative involves DOE approving two applications to export additional LNG from the Lake Charles LNG Liquefaction Project in Lake Charles, Louisiana, Trump said. In a statement released shortly after Trump spoke, DOE said it had previously authorized Lake Charles LNG to export up to 2 Bcf/d from the project, and that the additional export authorizations amount to 0.33 Bcf/d from the same facility. With engineering changes at the planned project, the additional design capacity can be realized by Lake Charles LNG Export Co., DOE said.

The final initiative is a new offshore oil and natural gas leasing program to open up more offshore acreage that had been closed to development by the Obama administration, Trump said. “We’re creating a new offshore oil and gas leasing program. America will be allowed to access the vast energy wealth located right off our shores. And this is all just the beginning, believe me,” he said.

In their discussion as a panel, Perry, Zinke, Pruitt, and Cohn emphasized regulatory reforms at their respective agencies and Cohn told of how in meeting with business leaders in the first few weeks of the Trump administration, every group struck the same them when asked about how they can improve the economy and hire more workers. The answers always were about regulation, taxes and infrastructure, in that order, which is why the administration has focused on those elements, Cohn said.

“Predictability in the regulatory climate is the single most important thing” for businesses, Perry said, recalling his time as governor of Texas, where the economy grew and the environment was improved.

At the Interior Department, “we’re going through a large reorganization” to change the way the agency addresses its numerous tasks, Zinke said. He views his role as leading the reorganization to simplify and streamline regulations, since strength comes from stability.

“We’ve been a bit busy on regulatory reform,” added Pruitt, commenting on how his goal is to have smarter regulation with less overlap and unnecessary rules that hinder the economy.

With several members of Congress at the DOE event, Perry said he will work with lawmakers to pass legislation to unleash domestic energy for foreign trade and pursue an “all of the above” strategy that includes all types of resources.

Industry representatives also spoke at the “Unleashing American Energy” event, which was held in conjunction with what the White House dubbed Energy Week. Earlier in the week, White House functions included a press conference by Perry, where he fielded questions on nuclear waste storage, infrastructure development, cybersecurity, and technology innovations, and a discussion with Native American leaders about energy resources on tribal lands.

Much of the discussion at the DOE event centered around how the U.S. has pivoted from being at the whim of global oil prices and importing oil from not-so-friendly foreign countries in the 1970s to becoming a global supplier of oil products and LNG. Around 2007, before the shale revolution began in earnest, some experts were predicting fossil fuel resources in the U.S. were limited, but with the tapping of large oil and gas reserves at low costs, the country has an asset that is foundational for a growing economy and energy security, said Karen Harbert, president and CEO of the U.S. Chamber of Commerce’s Global Energy Institute.

“We need to be an innovation nation rather than a regulation nation,” Harbert said.

Industry Panel. The industry panel included Harbert, Joe Craft, president and CEO of coal company Alliance Resources Partners, Ryan Lance, chairman and CEO of ConocoPhillips and Sean McGarvey, president of North America’s Building Trades Unions. Several of them mentioned the importance of infrastructure and pipelines to deliver oil and gas to new markets, and the need to restore a quorum at FERC associated with that.

Panel moderator Daniel Yergin, vice chairman at IHS Markit, mentioned how the energy industry is investing billions of dollars in LNG export facilities and other infrastructure projects, but the most economical investment the country could make is for the Senate to approve the two White House nominees for FERC.

FERC Nominees. Those Republican nominees, Neil Chatterjee and Robert Powelson, have been approved by the Senate Energy and Natural Resources Committee and awaiting a floor vote by the full Senate to take open commissioner seats at FERC. They received some good news from the White House, which late in the day June 28 announced an intent to nominate Richard Glick, general counsel for Sen. Maria Cantwell (D-Wash.), ranking minority member on the Senate energy committee, to fill the spot of FERC Commissioner Colette Honorable, a Democrat.

Honorable has indicated that she will be leaving FERC at the end of her term on June 30, meaning Acting Chairman Cheryl LaFleur, also a Democrat, will be the only commissioner at FERC until new commissioners are approved by the Senate.

When that will be remains to be seen, but the move to put Glick in place of Honorable may help break a stalemate that the Democrats in the Senate have held following committee approval of Chatterjee, the energy policy advisor for Senate Majority Leader Mitch McConnell (R-Ky.), and Powelson, a commissioner with the Pennsylvania Public Utility Commission. Democrats in the chamber have maintained the position that they will not vote on Chatterjee and Powelson until Trump announces a Democrat nominee for FERC.

Because an intent to nominate precedes the actual nomination paperwork being sent from the White House to the Senate, sources were not willing to speculate on whether Senate Democrats would agree to vote on Chatterjee and Powelson separately or hold out and seek a vote with Glick as part of a package. The latter route would add time to the process, with the energy sector anxious to have a quorum restored at the Commission to address matters that have been pending for nearly six months, following the departure of former Chairman Norman Bay in early February.

As reported previously,[1] Glick served as vice president of government affairs at Iberdrola before his most recent role in the Senate. He also worked at utility PacifiCorp and as senior policy advisor to former Secretary of Energy Bill Richardson. Prior to his stint at DOE, Glick was chief counsel to former Sen. Dale Bumpers (D-Ark.), and from 1988 to 1992, he was an associate at Verner, Liipfert, Bernhard, McPherson and Hand.

In a statement, Cantwell said Glick has had an accomplished career working on cutting-edge issues associated with the changes in the energy industry, and he will make an excellent addition at FERC. “I look forward to Rich’s swift confirmation and thoughtful contributions to a fully functioning FERC,” she said.

Industry groups also praised the choice of Glick and expressed hope that the Senate will quickly consider a nomination from the White House. The head of the Interstate Natural Gas Association of America urged President Trump to follow up the announcement with a formal nomination to be sent to the Senate.

“It is our hope that nominating Glick for the soon-to-be-open Democratic seat will facilitate a bipartisan agreement in the Senate on restoring a quorum at FERC,” said Don Santa, president and CEO of INGAA.

“Billions of dollars of investment and thousands of job opportunities in the U.S. are sidelined by a lack of a quorum at FERC and it is essential that the nominees be given the opportunity to be approved as quickly as possible,” said Dena Wiggins, president and CEO of the Natural Gas Supply Association.

The intent to nominate Glick came before any announcement from the White House on the other remaining open Republican spot at FERC. That seat has been expected to be filled by Kevin McIntyre, an attorney and co-leader of the energy practice at Jones Day.

It has been anticipated that Trump will nominate McIntyre, but his nomination paperwork has been taking longer than that of Chatterjee and Powelson, sources have said. McIntyre is expected to be tapped as chairman for his nomination, but when that nomination makes its way to the Senate and lawmakers hold a hearing to consider his nomination remains to be seen.

By Tom Tiernan TTiernan@fosterreport.com

[1]   See, Glick Seen as Likely FERC Nominee While Trade Groups Seek Senate Vote, FR No. 3154, pp. 1-2.

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