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RUNDOWN OF THREATS TO THE GRID: The threats that extreme weather and reserve capacity shortages pose to the nation’s power grid headline NERC’s new summer reliability assessment, but the regulatory body charts out several other factors that could add additional strain on utilities’ ability to meet electricity demand and raise the prospect of outages.

The list:

  • Deficient supply chains: NERC expects supply chain issues related to lack of product availability and labor shortages to cause problems for new resource and transmission projects. That could lead to delays or cancellations of transmission projects, which NERC noted “can cause transmission system congestion during peak conditions and affect the ability to serve load in localized areas.”
  • Coal sourcing: Power generators may also have difficulty sourcing coal, something Mark Olson, NERC's manager of reliability assessments, said is already happening. He pointed to insufficient freight availability and again, shortage of labor.

    “We don't see it affecting bulk power system reliability going into the summer, but it is a concern,” Olson told reporters yesterday.

  • Cyber threats: The threat of cyberattacks, especially from Russia, also imperil the grid, NERC said. The Energy Department and intelligence agencies alerted the sector to the threat of attacks over a month ago.
  • Storms or smoke reducing solar output: Grid disturbances may also trigger solar photovoltaic resources to trip offline, which happened on separate occasions in California and Texas last year.

    “These events happen when a normal grid disturbance like tripping some equipment or a lightning strike, that type of event,” Olson said.

    Where wildfires pop up, smoke may also stress the grid by diminishing output from solar PVs.

One final point: Regions managed by the Midcontinent Independent System Operator, or MISO, are in a particularly tough spot this summer. NERC deemed it to be the only jurisdiction at high risk of struggling with insufficient operating reserves in normal peak conditions.

“Retirement is an issue, and it's particularly in the MISO area, and we're seeing it manifested in this way,” Olson said, referring to retirement of coal-fired power plants.

MISO has retired around 18,300 megawatts since 2015, according to coal-fired power trade group America's Power.

Reliability “has to be the driver” of operators’ decisions, he said, adding that MISO is in “a bad spot” on that front.

Welcome to Daily on Energy, written by Washington Examiner Energy and Environment Writers Jeremy Beaman (@jeremywbeaman) and Breanne Deppisch (@breanne_dep). Email or for tips, suggestions, calendar items, and anything else. If a friend sent this to you and you’d like to sign up, click here. If signing up doesn’t work, shoot us an email, and we’ll add you to our list.

DEMOCRATS’ ANTI-GOUGING BILL PASSES: The House this early afternoon passed the Consumer Fuel Price Gouging Prevention Act, one of Democrats’ multiple proposals designed to stop market manipulation which they say is responsible for record gasoline prices. It passed 217-207 and a list of Democrats who voted against it was not yet available as of this writing.

The bill would authorize the president to issue an energy emergency and prohibit sales of consumer fuel at an “unconscionably excessive” price, and charge the Federal Trade Commission with enforcing a prohibition of excessive prices.

Energy and Commerce Chairman Frank Pallone, whose committee held a hearing with oil executives last month to consider why drivers are being “gouged at the gas station,” said on the House floor this morning oil companies are manipulating the market and “deliberately keeping production low” to enrich themselves.

Industry groups and analysts have strongly disputed the gouging allegations and said their higher profits are being driven by high oil prices and high demand.

Patrick De Haan, petroleum analyst with GasBuddy, called the gouging theory a “headfake” and said, as oil executives repeatedly told Pallone’s committee, that oil companies don’t set prices but rather “take” them.

“The Democrats are creating this illusion that oil companies are somehow suddenly the ones that can determine price when oil companies, again, are takers of whatever the market determines,” he told Jeremy.

HAALAND SAYS NEW OFFSHORE LEASING PROGRAM TO BE FILED BY END OF JUNE: Interior Secretary Deb Haaland said today that the Interior Department plans to file its new five-year offshore leasing proposal by the end of June—giving the first concrete date for submission of the plan, following pressure from Republicans and some Democrats to submit its proposal before the current one expires on June 30.

BOEM “is moving forward expeditiously” on development of the new five-year program, Haaland said today during an appearance before the Senate Energy and Natural Resources Committee. "The [Interior] Department will release the proposed program, which the next step in the five-year planning process—by June 30, which is the expiration of the current program."

"We take this responsibility seriously, and are not prejudging an outcome," Haaland told lawmakers. "I welcome your continued interest in inquiries and my team will follow up next month with details of a proposed plan,” she added.

Haaland's announcement follows weeks of mounting concern and calls to submit the five-year plan both from Republicans and some Democrats, who noted that, once submitted, the offshore proposals typically take anywhere between 6-12 months to be approved. Read more from Breanne here.

GAS PRICE WARNINGS: National gas averages could surpass $6 per gallon by the end of summer, according to new research from JPMorgan Chase.

The news comes as national average gas prices climbed to $4.48 per gallon Thursday, according to AAA—a 17-cent increase from the previous week, and a more than $1.50 surge from the same point last year.

HALF OF GAZPROM CLIENTS PAYING UNDER RUBLE SCHEME: About half of Russian gas giant Gazprom’s clients have agreed to pay for natural gas imports under Vladimir Putin’s rubles decree, Deputy Prime Minister Alexander Novak said.

The European Commission has recently shared new guidance with members explaining that companies could open accounts to pay for gas in accordance with Putin’s decree and still comply with sanctions against Russia, according to multiple reports.

Novak said some 54 companies with Gazprom contracts have opened accounts with Gazprombank as Putin ordered, Bloomberg reported, at the threat of shutting off supplies if customers don’t comply.

A number of European leaders were wary of the decree to pay in rubles when it was announced, calling it at a minimum a clear violation of gas supply agreements, which set out in clear language the currency of payment.

But Putin insisted nothing would change for customers. Beyond the opening of new special accounts and the addition of new procedures on the back end, the decree still allows transfers in euros. After that, the euros are to be sold on currency exchange and until that happens, payment isn’t considered complete.

For that, some EU leaders, including French ecology minister Barbara Pompili, said gas contracts would be respected under the decree.

Still, EU Energy Commissioner Kadri Simson emphasized the commission’s view that the decree is a unilateral change to contracts as recently as May 2, saying it is “perfectly legitimate under commercial law to reject it,” which has been keeping energy companies confused as to how to do right by EU sanctions rules.

CHINA EYES REFILLING STOCKPILE WITH RUSSIAN OIL: China is in talks with Russia about purchasing oil to refill its strategic petroleum reserves, Bloomberg reported. It’s not clear what volumes are under consideration, but such sales would allow China to refill its stockpiles cheaply while undercutting Europe’s efforts to punish Putin.

A CASE AGAINST SEC CLIMATE RULE: A new paper from conservative policy group CRES Forum is challenging the SEC’s rationale for its proposed climate-related risk disclosure rule, especially Chairman Gary Gensler’s claim that it’s a natural extension of SEC’s historic responsibility to help keep investors informed.

The paper argues that SEC’s proposed disclosure requirements on Scope 3 emissions, which cover everything from emissions associated with employee commuting and transportation and distribution activities, as well as emissions stemming from the use of a company’s products, would be especially burdensome to companies and beyond SEC’s scope as they are distant from immediate company operations and difficult to quantify.

“Scope 3 are just inherently difficult to obtain,” author Tim Doyle told Jeremy. “Scope 3 are not in the possession of or control of the company. Disclosure rules in the past, or historically, have always been information that is obtainable or that the company has.”

Doyle said further the essence of the rule is effectively a regulatory imperative “driving a company’s behavior towards a low carbon economy, which crosses into policy.”

“As soon as the entity crosses over into policy, they're out of their lane,” he added.

Environmental groups and Democratic lawmakers hailed the rule as a way to keep investors informed about the risks of climate change, although some environmentalists have sought stronger disclosure requirements, especially on Scope 3.

SEC extended the comment period for the rule by a month to June 17 after a number of industry groups requested more time to digest and weigh in on the proposal.

ELECTRIC VEHICLE SALES SEEING STRONG GROWTH AROUND THE WORLD: Global sales of electric vehicles grew by a whopping 103% in 2021, according to a new report from research firm Bloomberg NEF—an encouraging trend for EVs that comes as leaders around the world seek to reduce greenhouse gas emissions and incentivize more consumers to make the switch to electric.

In total, nearly 6.6 million EVs were sold in 2021, NEF researchers found. EV sales accounted for 13% of the total vehicles sold in the last quarter of 2021, or 9% when excluding plug-in hybrids. Researchers also found progress on publicly accessible EV charging stations. The global ratio of EVs to public charging stations globally is now 9.2—up from 7.4 the previous year. Read more on the group’s findings here.

OIL AND GAS EMPLOYMENT REBOUNDING: Employment in the U.S. oil and gas industry is rising and estimated to surpass pre-pandemic levels in the next five years, according to data from Rystad Energy.

The industry bled hundreds of thousands of jobs over the past two years, amounting to a loss of 20% of the total workforce, but Rystad estimates the rebound will mean a rise from about 863,000 to 971,000 total jobs through the end of the year. Estimates suggest the total number of O&G sector jobs will reach 1.09 million in 2027, compared to 1.07 million in 2019.

Analysts said rapidly rising oil prices and demand recovery are helping to drive the growth trajectory.

The Rundown

Bloomberg Predicting the future of Texas’s grid is a Texas-sized challenge

The Verge Why tech giants’ cash is a hidden source of greenhouse gas emissions



4:00 p.m. Evergreen Action will host Sen. Tina Smith and Rep. Ro Khanna for a “Policy + Pints'' discussion about passing the $555 billion in energy and climate change-related investments from the Democrats' stalled reconciliation proposal.


12 p.m. The House Select Climate Crisis Committee will hold a hearing that examines ways to create an affordable and resilient food supply chain in the face of climate change. The panel will hear testimony from nonprofit groups including ReFED, the North American Renderers Association, the National Audubon Society, and more.