Federal Energy Issues Joe Nipper, Sr. VP, Government Relations American Public Power Association at the California Municipal Utilities Association

Transcription

1 Federal Energy Issues Joe Nipper, Sr. VP, Government Relations American Public Power Association at the California Municipal Utilities Association Annual Conference Wednesday, March 30, 2011 Rancho Mirage, California

2 Overview General notes Energy and climate legislation EPA regulation Tax legislation Dodd-Frank implementation Cyber security legislation Federal power program Etc., etc.

3 General Notes Focus on federal budget and deficit Deficit Commission recommendation to be introduced as legislation in the Senate Elimination of tax-exempt bonds Increase PMA power to market rates Continuing Resolutions pile up awaiting real negotiation on the budget; current CR expires April 8 th Comity and comedy in short supply it s all about 2012

4 Climate Change/ GHG Emissions The primary legislative effort is to block the EPA, temporarily or permanently, from regulating GHG emissions under the Clean Air Act H.R. 910 (Upton, Whitfield) and S. 482 (Inhofe), The Energy Tax Prevention Act, would permanently block EPA. H.R. 910 has passed the House Energy and Commerce Committee and will be taken up soon on the House Floor. APPA supports the bill. S. 231 (Rockefeller) would block EPA regulations for two years. APPA supports this bill as well. Both S. 482 and S. 231 have been filed as potential amendments to the Small Business Act reauthorization bill now pending on the Senate floor. Sen. Baucus has also filed an amendment to the SBA bill that would codify EPA s tailoring rule and address application of New Source Review under proposed GHG regulation.

5 Energy Legislation House Speaker Boehner has indicated that the chamber may consider some small targeted bills addressing particular fuels, e.g. nuclear, but no comprehensive legislation. Conversely, Senate Energy Committee Chairman Bingman and Ranking Minority Member Murkowski have some interest in a package of energy provisions; perhaps a smaller version of S from last year. The committee is holding a hearing tomorrow (3/31) on S.629, The Hydropower Improvement Act (Bingaman/Murtowski) Sen. Bingaman and Murtowski have released a detailed survey seeking input on the President s proposal for a Clean Energy Standard of 80% by Responses are due by April 11 and APPA intends to respond.

6 EPA Regulation New Source Performance Standards for GHGs: EPA has held several listening sessions, APPA participated in the first one on 2/4/11. APPA recently filed comments emphasizing use of energy efficiency, opposing fuel switching, asking for more consideration (ANOPR and SBREFA panel) and extension of timeline. EPA has said it will issue proposed NSPS on July 26, which takes effect immediately for new and existing sources. EPA may issue a final rule by July EGU Mercury MACT proposed rule issued a few days ago with 60 day comment period. Includes acid gases which makes it more difficult. 900 pages are still being analyzed. Proposed rule for cooling water structures (CWA Section 316 (b)) is expected soon.

7 Tax Issues Legislation to reauthorize the Clean Renewable Energy Bond program will be introduced soon in the House and Senate. Will likely shorten the authorization period to 12/31/13 to lower the score. Seeking Republican support. When energy tax legislation is developed, APPA will seek to include clarification of the ability for public power to receive a transferrable tax credit under the Nuclear Production Tax Credit program. This was scored at zero cost to the Treasury. House Ways and Means Committee Democrats have introduced H.R. 992 to authorize a range of state and municipal bond programs including Build America Bonds.

8 The Dodd-Frank Wall Street Reform and Consumer Protection Act The CFTC still has not issued a swap definition or rules on margin. The CFTC continues to hold open meetings to issue proposed rules, with the next one scheduled for March 30. Congressional Committees of jurisdiction continue to hold hearings regarding Dodd-Frank implementation with CFTC Chairman Gensler testifying at almost all of them. APPA has filed a number of comments: Business conduct standards for swap dealers (as they apply to governmental entities) SEC municipal advisor rule (appointed utility board members could be required to register as financial advisors) End user exception for mandatory clearing of swaps Reporting and recordkeeping rules APPA recently signed onto a letter asking Senators to extend implementation of the Dodd- Frank Act so that the agency is given more time to enact the rules carefully and thoroughly. APPA supports full funding in the appropriations process for the CFTC as they are currently understaffed.

9 Cyber Security The White House: The Obama Administration undergoing a thorough interagency review to develop its own standards for what should be included in cyber security legislation. No details of this review have been made public. The Senate: Majority Leader Harry Reid (D-NW) gave the Chairs and Ranking Members of the seven Senate Committees with jurisdiction over some portion of potential comprehensive cyber security legislation until March 15 to work to achieve consensus. As that deadline has passed, the Committees will likely begin to work on their own individual bills. The House: House Speaker John Boehner (R-OH) has tasked Congressman Mac Thornberry (R-TX) with overseeing the House s effort on cyber security. Congressman Trent Franks (R-AZ) has been pushing his bill, the SHIELD Act, but there no movement towards consensus in the House either. NERC has been working aggressively to defend their role as defined under Section 215 of EPAct05. They have been meeting regularly with FERC and with important Members of Congress and Hill staffers to explain why they better suited than FERC to oversee reliability standards for the North American grid. There is a vendor-driven push for a broad, one size fits all fix to cyber security vulnerabilities. The cyber security coalition is wary of this effort and believes that this could lead to a top down approach on cyber security rather than allowing the inclusive and participatory NERC process to work as it was intended. It appears that Congress (especially the Senate) is reluctant to act until the White House releases the results of its interagency review. The longer the Administration waits to act, however, the more likely Congress is to act. Both the House and the Senate have begun to hold hearings on cyber security legislation.

10 Federal Power Program Proposals for market-based rates to assist deficit reduction. April 5th House Water and Power Subcommittee hearing on job growth and Restoring Common Sense to Federal Regulations. April 11th field hearing of House Water and Power Subcommittee in Fresno examining the man made drought resulting from federal policies on water allocation House Resources Committee Chairman Hastings will introduce his bill from last congress related to power customer liability in WAPA s Transmission Infrastructure Program

11 Other Issues Federal Energy Regulatory Commission Capacity markets; Must Offer Pricing Rule Demand response; approved full LMP payments; APPA will seek rehearing Telecom FCC order on pole attachments are due soon Seeking to share spectrum with public safety networks Smart grid

12 Questions?