Utility Dive: Lawmakers press DOE head nominee Granholm over potential job, revenue losses in fossil fuel sector

Dive Brief:

  • Republican and Democrat Senators on Wednesday pressed former Michigan Gov. Jennifer Granholm for assurance that the clean energy transition will not lead to a segment of Americans being "left behind" by the nascent green economy.
  • Granholm is President Biden's pick to lead the U.S. Department of Energy. At her confirmation hearing, she told the Senate Committee on Energy and Natural Resources that the administration's clean energy plan could lead to the creation of 10 million jobs.
  • Granholm took questions on a range of topics, including electric vehicles, cybersecurity, carbon capture, utilization and storage (CCUS), and the development of a U.S. battery supply chain. Many of her responses returned to themes of economic revitalization.

Dive Insight:

The Biden administration is viewing climate change and clean energy as an opportunity to bolster employment and grow the economy, Granholm said. But lawmakers from oil- and gas-producing states appeared skeptical — in part due to a new executive order implementing a temporary moratorium on new oil and gas leases on federal lands.

"Half of Wyoming is federally owned," said Sen. John Barrasso, R-Wyo. He said a long-term ban on leasing would cost about 62,000 jobs in New Mexico, 33,000 jobs in Wyoming, and 18,000 jobs in Colorado, and would cut revenues to the states by hundreds of millions of dollars.

"I'm not going to sit idly by ... while the Biden administration enforces policies that threaten Wyoming's economy and the life bloods of so many people in my state," Barrasso said. "Coal, oil, and natural gas are not going away, and America should not leave these assets stranded in the ground."

Granholm responded that the Biden clean energy plan would create more jobs in clean energy "than the jobs which might be sacrificed."

With regards to the leasing moratorium and its potential employment impacts, "this is something we're going to have to work on together," Granholm told Barrasso. She also added that currently-operating licenses will not be impacted by the moratorium.

Sen. Bill Cassidy, R-La., maintained skepticism regarding the Biden administration's energy plan. "There's a question before the American people: Does the Biden administration care about their jobs?"

Cassidy pointed to the Keystone XL oil pipeline, which Biden halted by withdrawing a key permit on his first day in office.

"How do we square the fact that we're killing 11,000 jobs," Cassidy asked, with a promise of green jobs that may not show up for some time.

"I totally get the concern about job losses," Granholm replied. "What I can tell you is from my experience in Michigan, that when we focused on providing incentives for job providers to locate clean energy in Michigan, they came."

"Place-based strategies are critical for areas that have been left behind," she told Sen. Martin Heinrich, D-N.M., in response to another employment question. Granholm committed to working with him to develop a location-specific plan to invest in and diversify oil and gas communities in New Mexico.

Batteries, carbon capture, security and more

There was also discussion of electric vehicles, in light of Biden's executive order Wednesday to electrify the federal fleet.

Granholm touted her insight into the sector, as she led Michigan during the Great Recession when auto manufacturing bankruptcies devastated her state. To recover, she said the state worked to attract investment from the electric vehicle industry and today about a third of all North American electric vehicle battery production is in Michigan.

"We can buy electric car batteries from Asia or we can make them in America," Granholm said. She discussed the necessary supply chain in response to a question from Sen. Lisa Murkowski, R-Alaska, and the broader implications of creating that domestically.

"If we allow for China to corner the market on lithium, or for the Democratic Republic of Congo to be the place where everyone gets cobalt, when there may be child labor or human rights violations associated with that supply, then we are missing a massive opportunity," Granholm said. "For our own security, but also for our trading partners who may want access to minerals mined in a responsible way."

Responding to a question from Sen. Steve Daines, R-Mont., Granholm reassured lawmakers from fossil fuel-producing states that there remains a place for oil, gas and coal in the U.S. energy mix.

"If we are going to get to net carbon zero emissions by 2050, we cannot do it without coal, oil and gas being part of the mix. But without CCUS technology ... without carbon management technologies being researched at the Department of Energy, we won't get to the goal of net carbon zero," Granholm said. "We must use those technologies to keep people employed and to clean up and remain energy independent."

Murkowski asked the sole question on cybersecurity, pointing to the SolarWinds hack and the need for "increased coordination throughout the executive branch." She also said Biden's decision to suspend an executive order issued by President Trump, which blocked utilities from installing equipment on the bulk power system that was sourced from adversarial countries, was "unwise" and puts the electric grid at greater risk for cyberattacks.

"This entire committee is concerned about where we are with reliability and the resilience of the grid, when it comes to cyber," said Murkowski.

Granholm said she had not been fully briefed on the SolarWinds attack, but acknowledged "we're getting hacked all the time and attacked all the time."

"We will have inside the DOE a person at a high level that is responsible for making sure the response to this is coordinated," said Granholm. "We have to harden our electric grid ... I hope is this is a part of the infrastructure package that will be coming from the administration."

By:  Robert Walton
Source: Utility Dive