SORRY, CANADA
JENNIFER GRANHOLM AS U.S. ENERGY SECRETARY SIGNALS SEISMIC SHIFT AWAY FROM OIL TO RENEWABLES.
calgary • Canadian-born, former Michigan Governor and future U.s. Energy secretary Jennifer Granholm will begin her term Wednesday handling a big row with canada as president-elect Joe Biden is set to cancel a major cross-border oil pipeline.
Vancouver-native Granholm will oversee a massive shift in U.s. energy policy as Biden seeks to transition the country — until recently the world’s largest producer and consumer of oil — towards more renewable energy.
in a symbolic effort to begin that shift, Biden on Wednesday is expected to cancel permits for the 830,000-barrels-per-day Keystone XL oil pipeline, which would limit the future growth of canada’s largest export to the U.s. and affect the trading relationship between the two countries.
“canada, unfortunately perhaps for canada, is collateral damage for a statement that is being made,” said Jim Bowe, a Washington, D.c.-based lawyer focused on energy at King and Spalding LLP.
“this isn’t intended to be a swipe at canada,” he said, but noted the Biden administration will start on rough terms with its largest trading partner if Keystone XL is cancelled.
Still, Bowe said there are many areas where a Biden administration can work with Canada on energy-related issues and Granholm will enable some co-ordination between Ottawa and Washington given her understanding of trade between both countries as the former governor of Michigan.
“She’s quite conversant in the importance of Canada/u.s. energy trade and Canada/u.s. auto trade,” said Bowe. “I think she’s pretty respectful of that relationship.”
Granholm, 61, is considered a clean-energy leader, giving speeches in recent years on how the u.s. can create jobs in renewable energy.
She sat on the boards of two green energy companies while teaching law at the university of California, Berkeley: electric-vehicle technology maker Proterra Inc. — which last week merged with blank-cheque company Arclight Clean Transition Corp. — and Chargepoint Inc., which operates a network of electric-vehicle charging stations.
Granholm also sat on the board of the u.s. subsidiary of Italian shipbuilder Fincantieri SPA, europe’s largest shipbuilding company.
American experts widely view Biden’s decision to appoint Granholm as a signal that a key focus of his administration will be increasing renewable energy use and working with detroit automakers to encourage more electric-vehicle manufacturing in the u.s.
“Canada is the largest u.s. energy trading partner and I think that will continue under a Biden administration, but I think the mix is going to change,” said Bernard Mcnamee at Mcguirewoods Consulting LLC in richmond, Va., and a former commissioner at the u.s. Federal energy regulatory Commission (Ferc).
Among the changes Mcnamee expects is an increased willingness to approve power lines connecting northeastern states with hydroelectric generating stations in places such as Quebec, as well as fewer oil pipelines connecting Alberta and Saskatchewan with refineries in the u.s.
“I think there’s going to be significant pressure on the Biden administration to review any pending permits for any oil and gas pipelines that would be built and enter into the united States,” Mcnamee said, adding those reviews could limit investment in pipeline construction.
In addition to Granholm, experts say the Biden administration looks keen to align multiple cabinet picks with the goal of transitioning the u.s. electric grid to non-emitting power sources and forcing the electrification of vehicles.
These picks include incoming Climate Change envoy John Kerry and Transportation Secretary Pete Buttigieg, as well as expected changes at the energy commission.
right now, Ferc’s five commissioners include three republicans and two democrats. It is expected that Biden will replace current Ferc chair James danly, a republican from Nashville, on Wednesday. He will also be able to replace Buffalo, N.y., republican commissioner Neil Chatterjee when his term expires at the end of June.
As a result, democrats will likely hold a 3-to-2 majority at the commission by the end of the week and a 4-1 majority by mid-year, thereby allowing Biden’s administration to push policies forward with an energy regulator in full alignment.
experts expect the newlook Ferc, as well as a restrengthened u.s. environmental Protection Agency led by North Carolina democrat Michael regan, will make it more difficult for oil and gas pipeline companies to build new inter-state projects, because regulators will likely require projects to account for both upstream and downstream carbon emissions, just as the Canada energy regulator does now.
“The policies of green-lighting linear infrastructure are going to change,” said Kevin Book at Clearview energy Partners LLC, a Washington, d.c.based energy research and consulting firm.
Book said the new administration intends to move “from molecules to electrons,” meaning new policies and regulations will encourage electrification and clean power, and rely less on fossil fuels. “We have a very fossil-intensive grid,” he said.
In addition, Book said, Granholm is a clear indication that Biden intends to push to transition automobiles away from internal combustion engines in the near future.
Granholm’s experience as Michigan’s governor means she will be tapped to work with American automakers as the u.s. federal government pushes for more electric vehicles while likely ratcheting up standards for vehicle emissions.
Book believes this will be a key focus for Biden, since the incoming president has picked two cabinet members from regions with large auto manufacturing sectors in Granholm from Michigan and Buttigieg, the former mayor of South Bend, Ind.
“One would have been significant, but two is unmistakable,” he said. “These are Biden’s ambassadors to car country.”
these are Biden’s ambassadors to car country.