Energy & Environment — Bipartisan talks push on, but some see delay tactic 

Bipartisan energy talks are running full steam ahead while reconciliation remains on ice, and the Biden administration is pitching a new efficiency rule for commercial water heaters.  

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. Someone forward you this newsletter? Subscribe here. 

Bipartisan talks pick up steam 

A group of about a dozen lawmakers is pushing for a bipartisan deal on climate change, meeting three times in two weeks to try to work out a deal that could get 60 votes in an evenly divided Senate.   

The talks, led by Sens. Joe Manchin (D-W.Va.) and Lisa Murkowski (R-Alaska), appear to have gained momentum as work on a separate reconciliation package that would have included climate provisions sits on ice. 

However, lawmakers are describing discussions on the bipartisan maneuver as still being relatively early, and it’s not clear whether they will be able to reach a deal that satisfies enough senators on both sides.  

The latest talks, which took place Wednesday evening, focused on tax credits, which were also a major component of Democrats’ failed Build Back Better bill. 

Specifically, Build Back Better had incorporated tax credits expected to benefit energy sources including solar, wind and nuclear and things like batteries and carbon capture.  

Some Democrats had expressed hope that the bipartisan route may be a way to get some of these credits across the finish line and to President Biden’s desk.  

“There’s a way to get real climate action. In other words, a lot of what was in the reconciliation bill could be in this bipartisan bill,” Sen. John Hickenlooper (D-Colo.) told The Hill on Tuesday. 

Irreconcilable differences? Asked why Democrats were pursuing a bipartisan strategy rather than trying to negotiate among themselves, Hickenlooper said, “we don’t have 50 votes.” 

However, others see a potential bipartisan package as running concurrently with a reconciliation bill.  

Sen. Tom Carper (D-Del.) described a “two-track process” that would include a bipartisan climate change bill that “builds on” the bipartisan infrastructure law and another that may “go beyond that.”

“We can do both at the same time,” he said.   

Read more about the talks picking up steam here, from Rachel. 

MEANWHILE, SOME FEAR IT’S A STALLING MANEUVER 

Democratic senators worry the bipartisan energy talks are Manchin’s excuse to avoid negotiating a budget reconciliation package, which some of them believe needs to get sketched out by Memorial Day to have a chance of passing.   

“We’re running out of time. The calendar is staring us in the face, and I’m concerned we have no time to waste on conversations that are futile,” said one Democratic senator.   

A second Senate Democrat also expressed anxiety that Manchin, the chairman of the Senate Energy and Natural Resources Committee, may chew up several weeks of the Senate calendar trying to hash out an energy deal with Republicans without getting a result and stall any movement on Biden’s agenda.   

“I share that concern,” the senator said.   

The lawmaker added that Manchin appears to be entirely focused on the bipartisan energy talks, which took place throughout this week.  

“Chairman Manchin seems genuinely interested in the opinions of everyone at the table,” the source said.   

At this point, several Democratic senators are close to giving up hope that Manchin will support any kind of budget reconciliation package, given his oft-stated desire to work in a bipartisan way with Republicans. 

“I’m the skeptic on budget reconciliation,” said Senate Majority Whip Dick Durbin (D-Ill.). “I announced when I came back here in January it was not on my agenda. I was going to really focus on everything outside of reconciliation.”  

He said it’s ultimately up to Manchin and fellow centrist Sen. Kyrsten Sinema (D-Ariz.) whether a budget reconciliation bill moves, but he’s not counting on it.   

Read more about the fears it could be a stalling tactic here, from The Hill’s Alexander Bolton.

Energy proposes regulations for water heaters 

The Department of Energy on Thursday announced new proposed energy efficiency rules for commercial hot water heaters that would require the use of condensation technology.  

The department projects that the proposed rules could save up to $140 million in energy costs per year and up to $2.4 billion over 30 years. They are also projected to reduce carbon emissions by the equivalent of 4.8 million homes and slash methane emission by 2.3 million cars’ worth.  

Water heaters are a major driver of energy costs and most are a model that has not been meaningfully upgraded in about a century.  

A 2021 report from the American Council for an Energy-Efficient Economy estimates they are particularly energy inefficient in multi-household buildings, where they use more energy than cooling, light or space heating. 

The same analysis projects that replacing those units with energy efficient hot water heaters would cut their greenhouse gas emissions by an estimated 58 percent.  

In commercial buildings, meanwhile, the cost of heating with gas-powered equipment comprises nearly 20 percent of commercial buildings’ natural gas usage, according to the Energy Information Administration.   

Read more about the proposal here, from Zack. 

SOME PERSONNEL NEWS

• On Thursday, the White House Council on Environmental Quality announced that Jalonne White-Newsome would serve as its Senior Director for Environmental Justice. White-Newsome founded a consulting firm focused on issues including environmental justice and climate change. Her appointment comes after the departure of predecessor Cecilia Martinez. 
• Also on Thursday, the Senate confirmed Kathryn Huff to lead the Energy Department’s nuclear energy office in an 80-11 vote. Since last year, Huff had been the Office of Nuclear Energy’s principal deputy assistant secretary and previously was an assistant professor in the nuclear, plasma, and radiological engineering department at the University of Illinois at Urbana-Champaign. 

ON TAP NEXT WEEK

    Wednesday: 

• White House Council on Environmental Quality Chair Brenda Mallory will testify before the Senate Environment and Public Works Committee in an oversight hearing 

    Thursday: 

• The House Natural Resources Committee will hold a hearing on “reforming the Mining Law of 1872” 
• The House Energy and Commerce Committee will hold a hearing on hydropower 
• The House Foreign Affairs Committee will hold a hearing on forest conservation and climate change 

WHAT WE’RE READING

• Oil giant Shell reports highest quarterly profit since 2008 on soaring commodity prices (CNBC) 
• Louisiana state legislator pushes bills benefiting the oil and gas industry — and her husband (Floodlight) 
• West Virginia legislative leaders all in on federally funded hydrogen hub that critics call a costly gamble (The Charleston Gazette-Mail) 
• The Ocean’s Biggest Garbage Pile Is Full of Floating Life (The New York Times) 
• A solar battle in sleepy Wareham, Mass., is pitting environmentalists against each other (The Boston Globe) 

That’s it for today, thanks for reading. Check out The Hill’s Energy & Environment page for the latest news and coverage. We’ll see you next week.  

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