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The Biden administration needs help understanding the meaning of “foreign entity of concern” (FEOC) as this term relates to investing billions of taxpayer dollars into bolstering the supply chains for materials critical to electric vehicles and renewable energy.

The Bipartisan Infrastructure Law and Inflation Reduction Act allotted billions of dollars for establishing secure and reliable supplies for the minerals, metals, and materials needed for EVs and low-carbon energy infrastructure in the United States.

Congress included stipulations in these bills that require energy transition minerals to be mined or processed in the U.S. or a free trade agreement country, and prohibits the involvement of an FEOC in order to qualify for the generous tax credits and funding offered.

Earlier this year, S&P Global analysts forecast that the U.S. would come up short of the minerals and metals required to meet Biden administration energy transition goals.

“This new comprehensive analysis shows that the Inflation Reduction Act is indeed transformative on the demand side,” said S&P Global Vice Chairman Daniel Yergin. “However, challenges remain in securing supply of critical minerals needed to meet growing demand and achieve its goal of accelerating the energy transition.”

These challenges include U.S. permitting timelines that are much too long to fit within the White House’s clean energy ambitions.

“Timely and transparent permitting is a fundamental operational challenge to supplying metals for the energy transition, particularly in developed markets such as the United States that have high levels of transparency and both political and civil society scrutiny of policy,” said S&P Global Market Intelligence Executive Director Mohsen Bonakdarpour.

Loosening up the definition of FEOC would broaden the scope of critical mineral suppliers that meet BIL and IRA eligibility.

“This smacks of regulatory overreach and purposeful misinterpretation of the Bipartisan Infrastructure Law (BIL), designed to ‘bolster the growth of domestic and friend-shored battery materials processing and manufacturing,” Ann Bridges, co-author of “Groundbreaking! America’s New Quest for Mineral Independence”, told Metal Tech News.

Reinterpreting Congress

When drafting the Bipartisan Infrastructure Law, Congress described an FEOC as being “owned by, controlled by, or subject to the jurisdiction or direction of a government of a foreign country that is a covered nation.”

Covered nations include China, North Korea, Russia, and Iran.

Now, DOE is seeking input on its reinterpretation of the terms “government of a foreign country;” “foreign entity;” “subject to the jurisdiction;” and “owned by, controlled by, or subject to the direction.”

Using Merriam-Webster definitions of the keywords that DOE is seeking to reinterpret, an FEOC is defined as: An organization, business, or governmental unit owned by; restrained or directed by; subject to the authority of; or under the restraining or directing influence of China, North Korea, Russia, or Iran.

The Biden administration, however, is not seeking a literal definition of what Congress wrote into the Bipartisan Infrastructure Law and Inflation Reduction Act.

Instead, DOE has rolled out its own proposed “interpretive guidance” for a foreign entity of concern.

Under this guidance, an FEOC would be incorporated in, headquartered in, and operating within China, North Korea, Russia, or Iran; and the government of the covered nation also directly or indirectly controls at least 25% of the company’s voting or equity interests or board seats.

Companies that operate outside of China, North Korea, Russia, or Iran but contract with or license technology from any of these nations must retain certain rights over their operations.

“The proposed guidance will provide clarity and certainty to the U.S. automakers, battery manufacturers and producers of critical minerals. It will encourage these industries to invest in diversified and resilient critical mineral and battery supply chains,” said John Podesta, who is serving as renewable energy advisor to the White House.

The guidance will also temporarily exempt certain critical minerals from FEOC restrictions altogether. The Treasury Department, which is working with the Internal Revenue Service to implement EV tax credits subject to FEOC stipulations, said the exemptions only account for 2% of materials used in batteries.

Green energy shove

Silicon Valley author and critical minerals expert Bridges contends that the White House is attempting to circumvent the domestic energy materials sourcing rules intended by Congress to push forward the administration’s own clean energy plan.

“Biden’s Department of Energy is once again muscling aside Congress’ intent, representing both Democrats and Republicans, in a last-minute effort to shove through a green agenda that consumers don’t want, our country can’t afford, for technology simply isn’t ready yet for large-scale deployment,” she wrote in an email to Metal Tech News.

“The appropriate department to determine which country is a Foreign Entity of Concern seems to fall squarely in the Department of State instead – and requires CFIUS (Committee on Foreign Investment in the United States) review, too,” she added.

DOE has published its proposed interpretation of the statutory definition of FEOC on the National Register for 30 days of public comment before official adoption.

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Imagine if nearly half of New York City lost heat for months during the winter. That’s not the plot of a new survival drama. Such a catastrophe nearly occurred last Christmas, according to an alarming recent report by energy regulators that deserves more attention.

The Federal Energy Regulatory Commission (FERC) and the North American Electric Reliability Corporation last month published a 168-page review of the electricity and natural gas problems during winter storm Elliott last December. It was the fifth time in 11 years that power plant failures caused by cold weather jeopardized grid reliability.

At the same time demand for electricity to heat homes ramped up, many gas generators failed for technical reasons or lack of fuel. Hundreds of thousands of Americans in the southeastern U.S. lost power on Christmas Eve while millions more were urged to conserve power.

It “is especially disconcerting that it happened in the Eastern Interconnection which normally has ample generation and transmission ties to other grid operators that allow them to import and export power,” the report notes. Yet problems cascaded through the eastern U.S.’s interdependent energy systems, which nearly caused New York City’s gas distribution to collapse.

A particular problem was that wells in the Marcellus and Utica shale deposits that supply much of the eastern U.S. with natural gas froze, reducing production by 23% to 54%. While gas supply fell, demand for electricity and heating surged, causing the pressure in interstate pipelines that supply downstate New York to plunge.

New York City utility Con Edison, “given its downstream location near the end of the interstate pipelines, was disproportionately impacted by the deteriorating pipeline conditions, through no fault of its own,” the report says. To restore pipeline pressure, Con Edison curtailed gas to some customers and activated a liquefied natural gas regasification plant.

Otherwise, Con Edison “could have faced an unprecedented loss of its entire system that, in this worst case scenario, would have taken months to restore, even with mutual assistance” while customers “would have been unable to heat their apartments and houses while the outside temperature was in the single digits, for months,” the report says.

Winter storms happen, but U.S. energy systems are becoming less resilient as coal and nuclear power plants shut down owing to competition from heavily subsidized green energy and cheaper natural gas. While gas power is more reliable than wind and solar, icy winter conditions can still cause fuel shortages.

Allowing shale fracking in upstate New York might have mitigated the gas supply shortage at the margin, but former Gov. Andrew Cuomo blocked that. The climate lobby’s antidote is electric heat pumps, but that would have increased strain on an already stressed grid. If New York City relied mostly on electricity for heat, millions could have lost both power and heat during the arctic blast. How’s that for a zombie apocalypse?

The New York Independent System Operator reported this week that the Empire State would need to rely on power plants that can switch to burning oil during the winter into the next decade owing to gas shortages and lulls in offshore wind. Another problem: “EV charging load is higher on colder days due to reduced battery efficiency and reduced EV range in cold temperature.”

You’d think all this would be news given the growing risks of grid failure, but such talk is taboo among those who want the U.S. economy to run solely on electricity driven by wind and solar energy. Don’t say New Yorkers weren’t warned.

Source: WSJ

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ENB Pub Note: Make no mistakes; The Biden Administration has absolutely

The Biden Administration is forging ahead with its green agenda by committing the United States to not building any new coal plants and phasing out existing plants.

U.S. Special Envoy for Climate John Kerry announced at the annual United Nations climate change summit, known as COP28 and which is being held in Dubai, although no date was given for when the existing plants would have to go.

“We will be working to accelerate unabated coal phase-out across the world, building stronger economies and more resilient communities,” Kerry said in a statement.

“The first step is to stop making the problem worse: stop building new unabated coal power plants.”

Kerry said America was joining the Powering Past Coal Alliance, a pact of nearly 60 countries that have promised to accelerate the phasing out of coal-fired power stations, except the very few that have carbon capture and storage.

WHITE HOUSE PROHIBITING OFFICIAL TRAVEL TO FOSSIL FUEL CONFERENCES, INTERNAL MEMO SHOWS

Kerry said the action forms part of America’s plan to limit global warming to 1.5 Celsius.

As of October, just under 20% of the U.S. electricity is powered by coal, according to the Department of Energy. The amount of coal burned in the United States last year was less than half what it was in 2008.

Last month President Biden said that coal plants “all across America” will be shut down, to be replaced with wind and solar.

A move to close down coal plants in the U.S. is already underway as federal clean energy tax credits and regulations make it harder for operators to compete economically.

A report by the nonpartisan Institute for Energy Economics and Finance Analysis found that 173 coal plants are set to close by 2030 and another 54 by 2040.

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Fifty oil and gas companies, representing more than 40 per cent of global oil production, made pledges on methane and carbon dioxide at the Cop28 climate conference on Saturday.

The companies, of which 60 per cent are national oil companies, signed on the Oil and Gas Decarbonisation Charter, which calls for net zero emissions by 2050 or before.

They will also aim for “near-zero” upstream methane emissions and zero routine flaring by 2030.

The charter was launched by the Cop28 Presidency and Saudi Arabia at the UN climate summit as part of efforts to decarbonise the oil and gas industry, which directly and indirectly accounts for 42 per cent of global emissions.

The signatories include NOCs such as the UAE’s Adnoc, Bahrain’s Bapco Energies and Saudi Aramco, the world’s largest oil-exporting company.

Italy’s Eni, ExxonMobil, Occidental Petroleum, Shell and TotalEnergies were among the international oil majors that signed the charter.

The Cop28 Presidency also said it would mobilise $1 billion for methane abatement projects.

“The launch of the OGDC is a great first step – and while many national oil companies have adopted net-zero 2050 targets for the first time, I know that they and others, can and need to do more. We need the entire industry to keep 1.5°C within reach and set even stronger ambitions for decarbonisation,” said Dr Sultan Al Jaber, Cop28 President.

“I am committed to both inclusivity and transparency. If we want to accelerate progress across the climate agenda, we must bring everyone in to be accountable and responsible for climate action,” added Dr Al Jaber, who is also UAE Minister of Industry and Advanced Technology.

After CO2 emissions, methane is the second largest contributor to climate change, caused by humans. It is a greenhouse gas that warms up quickly, more than 80 times faster than carbon dioxide.

Climate experts say that reducing the international output of methane emissions is the most effective and least disruptive way to slow down the increase in global temperatures over the next few decades.

“The announcement mentions investing in energy systems for the future but all oil and gas companies are already doing this. It’s about how much they are doing, compared to fossil fuel developments,” said Antony Froggatt, deputy director of the Environment and Society Centre at Chatham House.

Investments worth $75 billion will be required to reduce global oil and gas methane emissions by 2030 under the International Energy Agency’s Net Zero by 2050 scenario.

More than 150 countries participated in the Global Methane Pledge that was launched at Cop26 in 2021.

The pledge aims to achieve a reduction of methane emissions by at least 30 percent below 2020 levels by 2030.

However, India, Russia and China, who are among the world’s largest methane emitters, have stayed out of it.

The safeguards are expected to reduce tens of millions of tonnes of methane and other pollutants from oil and gas leaks, venting and flaring.

Global oil companies have been investing billions of dollars into carbon capture technology and hydrogen as part of their decarbonisation plans, but the IEA has warned against “excessive expectations and reliance” on carbon capture or storage.

If oil and natural gas consumption were to evolve as projected under the current policy settings, this would require an “inconceivable” 32 billion tonnes of carbon capture utilisation and storage by 2050, including 23 billion tonnes through direct air capture, the Paris-based agency said in a report last month.

“The idea that the oil and gas producers can carry on doing what they do, while diverting some emissions through massive deployment of CCUS is, I will say, a fantasy. It will never happen. The numbers don’t add up,” Fatih Birol, the IEA’s executive director said.

The oil and gas charter is a part of the global decarbonisation accelerator, a series of initiatives aimed at speeding up the energy transition and drastically reduce global emissions.

It focuses on scaling the energy system of the future; decarbonising the existing energy system; and targeting methane and other non-CO2 greenhouse gases.

The Cop28 Presidency said that more than 110 countries had signed the global renewables and energy efficiency pledge.

The countries will commit to work together to triple the world’s current renewable energy generation capacity to at least 11,000 gigawatts by 2030, considering “different starting points and national circumstances.”

They will also aim to double the global average annual rate of energy efficiency improvements to 4 per cent from 2 per cent currently amid efforts to limit the global temperature rise to 1.5°C, the key Paris Agreement goal.

“We should see it as providing momentum, a means not an end, for landing the global target to triple renewable energy by 2030,” said Andreas Sieber, associate director of policy at environmental organisation 350.org.

“It is crucial that the global renewable energy transition occurs at the scale and speed necessary and does not exclude wide parts of the Global South substantial support,” Mr Sieber said.

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Michigan Governor Gretchen Whitmer signed Democrat-proposed energy bills, implementing some of the strictest energy mandates in the country.

The plan requires utility providers to transition to completely carbon-free energy generation by 2040, with specific targets set for 2030 and 2035.

Proponents claim the bills will create jobs and lower utility costs, but critics argue that the legislation will increase power outages, industrialize farmland, and raise costs for residents while providing less reliable electricity. (Trending: Greta Thunberg Caught on Video Going Full Anti-Semite)

“With passage of these game-changing bills, Michigan will become a national leader on clean energy,” wrote Whitemer.

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ENB Pub Note: We will review these regulations and report on the first-, second-, and third-order magnitude impacts. 

EPA has issued a final rule that will sharply reduce emissions of methane and other harmful air pollution from oil and natural gas operations — including, for the first time, from existing sources nationwide. The final action includes New Source Performance Standards to reduce methane and smog-forming volatile organic compounds from new, modified and reconstructed sources. It also includes Emissions Guidelines, which set procedures for states to follow as they develop plans to limit methane from existing sources. Oil and natural gas operations are the largest industrial source of methane pollution in the U.S.

Methane is a climate “super pollutant” that is more potent than carbon dioxide and is responsible for approximately one third of current warming resulting from human activities. Rapid, sharp cuts in methane can generate near-immediate climate benefits and are a crucial addition to cutting carbon dioxide in slowing the rate of warming of Earth’s atmosphere.

Regulatory Documents

Final Rule and Regulatory Text (pdf) (5.85 MB)
Regulatory Impact Analysis (pdf) (3.31 MB)

Supplementary Material for the Regulatory Impact Analysis: Report on the Social Cost of Greenhouse Gases (pdf) (8.94 MB)

Fact Sheets

Key Things to Know About EPA’s Final Rule for Oil and Natural Gas Operations (pdf) (184.1 KB)
EPA’s Final Rule for Oil and Natural Gas Operations: Overview   (pdf) (183.74 KB)
Technical Fact Sheet: Appendix K: Requirements for Using Optical Gas Imaging, Applied to Natural Gas Processing Plants  (pdf) (180.93 KB)

Tables

Table of Covered Sources by Site: EPA’s 2012, 2016 and 2023 Rules (pdf) (226.53 KB)
Summary of Requirements: Final New Source Performance Standards and Emissions Guidelines (pdf) (248.17 KB)

Upcoming Trainings

EPA will hold trainings in early 2024 to provide an overview of the final rule for  communities, Tribes, tribal environmental professionals and small businesses. The Agency also will hold trainings on how to apply to use alternate test methods for detecting methane and on how to apply to be EPA-certified for the Super Emitter Program. We will post information on the trainings on this web page as they are scheduled.

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Former Wall Street banker Randall Atkins got a lot more than he bargained for when he paid $2 million for a Wyoming coal mine without even seeing it in 2012. At the time, he planned to make money selling coal from his mine to other plants. That was before he conducted a study in conjunction with the Department of Energy and discovered he was sitting on a treasure worth more than the gross domestic product (GDP) of some small countries.

It turns out that his coal mine was also home to an estimated $37 billion worth of rare earth elements (REEs). These elements are part of a rich vein of unconditional deposits running throughout the mine. Unconditional deposits are rare earth elements contained inside other minerals and rocks, such as cobalt.

They must be harvested through a different process than normal mining. The rocks containing the REEs must be crushed, ground down or broken so that the REEs they contain can be accessed. It sounds like a complicated and expensive process, but the potential value of REEs makes that process worth the trouble.

Why Are REEs So Valuable?

REEs are valuable for several reasons, the first of which is that they’re hard to find in great quantities. That’s where the “rare” in REEs comes from. Second, REEs are valuable in several key technologies and industries. Some of the products that require REEs as part of their production process include:

Lasers
Cell phones
Jet engines
Batteries
High-end specialty glass products

As the world’s technological dependence grows, the REEs used in the manufacture of things like computer and cell phone batteries become more valuable. An REE study by the U.S. Geological Survey showed that America imported over $150 million worth of REEs in 2021.

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ENB Pub Note: Some may argue that the title of this article should read: “Efforts to Slow Climate Change Could Create Humanitarian Crises.” There is way too much talk from the WEF and Bill Gates-type folks wanting to intentionally reduce the global population through pandemics or controlling food. What was once a conspiracy theory is now something to be reviewed.

As leaders converge on COP 28 in the United Arab Emirates, the international climate change meeting will have for the first time an explicit focus on climate change’s effect on health and wellness.

As physicians based in the Democratic Republic of Congo (DRC) and the U.S., we applaud that meeting organizers are doing a deep dive on health issues; health and human rights should be an integral part of discussions throughout COP 28, particularly as they involve the mining of natural resources to meet renewable energy demands. The DRC is an example of this, where even seemingly progressive and beneficial energy policy could make worse the working conditions, the overall health and the living conditions of the poorest children and adults who work in mines. Countries striving for independence from fossil fuels must ensure that shifting to a green economy does not add to what some public health experts call “modern day slavery.”

Our own countries, both part of the meeting, seem to be business-oriented, taking for granted some of the health disparities propagated by climate change initiatives. In November the World Bank released its DRC Country Development Country Climate and Development Report. It noted the DRC’s potential to be at the forefront of fighting climate change. Similarly, President Biden’s Bipartisan Infrastructure Law and Inflation Reduction Act has provided lucrative incentives for Americans to invest in a number of options to support clean energy.

But these policies increase the demand for the raw materials to make green technology, particularly a key ingredient: the mineral cobalt. The DRC produces more than 70 percent of the world’s cobalt, which has to be mined through intensive labor efforts that often go unregulated. And while a World Bank report acknowledged greater transparency is needed in the mining industry to ensure economic equity, it did not discuss the vast health disparities currently being driven by policies like Biden’s that are meant to better the environment.

Up to 30 percent of the DRC’s cobalt is extracted through “artisanal mining”—small scale operations that rely on child labor, unsafe working conditions and exposure to hazardous pollutants that lead to poor health outcomes, such as neurological impairment or respiratory failure. Children often start working in the mines at an early age, without proper equipment, food or health care. Many mines have high levels of radioactivity, and a high risk of collapse, leading to injury or death.

The global push towards renewable sources of energy has overshadowed the humanitarian crisis that has been happening over the past several decades in the DRC. More than five million people have been displaced within the country and more than one million Congolese have sought asylum. While much of the displacement has been fueled by conflict, mining has also caused people to be evicted or otherwise threatened to leave their homes, contributing to further forced relocation.

The world often refers to the DRC as an under-resourced country. However, the DRC is one of the richest countries in terms of natural resources. The majority of Congolese do not benefit financially from the world’s demand for cobalt. A significant part of the health care system is dependent on fees paid directly by patients for services. As a result, the poor and displaced, including some of those mining for cobalt, have difficulty accessing care, because of inability to pay and the lack of health insurance. Health care providers in the country care for these people, some with conditions resulting from their hazardous work, with little infrastructure to support them.

The Biden administration has increased its focus on the DRC’s natural resources, but has taken little responsibility in supporting Congolese refugees, who top the list of countries of origin for U.S. asylum applicants. The DRC is the only country of the top five, which includes Syria, Sudan, Burma and Ukraine, not designated for Temporary Protected Status, which would allow for streamlined acceptance of asylum seekers. It is unfathomable that the U.S. government has not granted TPS to DRC refugees and has taken a selective solidarity approach by not including this one country along with the others.

There is an overwhelming price for the shift to energy independence, and it is being paid by the most vulnerable citizens of the DRC. Most of the world is aware of the devastating effects of climate change, but many are not aware of the unintended consequences that sourcing of minerals like cobalt have caused. We cannot selectively demand for decreasing carbon emissions and at the same time be blind to the injustices that are happening in the DRC.

The delegates at COP 28 and the world need to ensure that the focus on renewable energy is not myopic. While funds have been provided to the DRC to support better mining conditions, there needs to be more transparency about how the funds are being used, and if the individual workers are indeed experiencing improvements to their quality of life. COP 28 countries should also support those who have been displaced with more fair and just asylum practices. The world’s environmental freedom should not come at the expense of disenfranchisement of the citizens of the DRC.

Scientificamerican.com

This is an opinion and analysis article, and the views expressed by the author or authors are not necessarily those of Scientific American.

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