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ADMINISTRATION SCRAMBLES TO GET READY FOR EV CREDITS: The Biden administration is trying to get out ahead of what’s expected to be a messy start to the rollout of the new electric vehicle tax credit.

Some foreign-assembled vehicles (such as Kia and Hyundai models) that were eligible for the credit as it stood yesterday, before President Joe Biden signed the Inflation Reduction Act into law, are no longer eligible as of today.

The Biden administration introduced a new frequently asked questions webpage laying out the most immediate changes to the credit. It is also directing buyers to the Department of Transportation’s vehicle identification number tool, which allows them to find manufacturing information, including location of assembly, to double-check a model’s eligibility before making the purchase.

The Department of Energy also just published its own list of eligible 2022 and 2023 EVs, based on its most up-to-date manufacture information: 21 models are immediately eligible, while another 10 Tesla and GM models will be once the existing cap lifts on Jan. 1.

But the list is going to be fluid. A Treasury Department official emphasized yesterday that it provides “a general sense” of what vehicles are eligible as of this summer.

Other things that will change: How purchasers can actually receive the credit will also change. For now, they’ll have to wait until they file their next tax return, but starting in 2024, it will be made available at the point of sale to reduce the purchase prices.

When the novel battery component sourcing requirements start to take effect in 2024, purchasers will also have to negotiate new eligibility requirements.

The assembly requirement and materials qualifications will be challenging for some automakers, who jumped at the chance to lock in contracts before the new rules take place.

“This next three months will be confusing,” said Jesse Jenkins, a professor of engineering at Princeton University. He expects 2023 to be better for some leading automakers, especially Tesla and GM, whose models will be eligible again after the 200k-unit cap is lifted.

“Where things get tricky again then is in ‘24 and ‘25,” he said, referring to the battery and mineral sourcing requirements.

Welcome to Daily on Energy, written by Washington Examiner Energy and Environment Writers Jeremy Beaman (@jeremywbeaman) and Breanne Deppisch (@breanne_dep). Email [email protected] or [email protected] for tips, suggestions, calendar items, and anything else. If a friend sent this to you and you’d like to sign up, click here. If signing up doesn’t work, shoot us an email, and we’ll add you to our list.

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RUSSIA’S GAZPROM FORECASTS 60% SPIKE IN GAS PRICES THIS WINTER: Russian state-owned gas giant Gazprom warned yesterday that European gas prices could surge by an additional 60% this winter—up to more than $4,000 per 1,000 cubic meters, as it slows its own exports and productions, citing Western sanctions passed in response to its invasion of Ukraine.

Since Jan. 1, Gazprom said its exports have fallen by more than 36%, down to just 78.5 bcm in mid-August. The company’s production has also slowed to 274.8 bcm as of August 15—a 13.2% drop compared to the same point last year.

"European spot gas prices have reached $2,500 [per 1,000 cubic meters],” Gazprom said in a Telegram post. “According to conservative estimates, if such a tendency persists, prices will exceed $4,000 per 1,000 cubic [meters] this winter.”

Moscow’s fossil fuel exports are central to its economy, with oil and gas exports alone accounting for nearly half of its federal budget in 2021, according to data from the International Energy Agency.

NORWAY VOWS TO SEND GERMANY AS MUCH GAS AS POSSIBLE: Norwegian Prime Minister Jonas Gahr Støre, speaking alongside German Chancellor Olaf Scholz after a meeting focused on energy security, described Germany as “Norway’s most important partner in Europe,” and vowed his country will “[deliver] as much gas as possible to Germany.”

"In total, we have been increasing our gas exports compared to what we had at the outset by close to 10%, which is really maximum, so we will do whatever we can with the companies to maintain a high level," Støre said, adding that any increases beyond that would depend on Oslo finding and developing additional resources.

Meanwhile, in Berlin… Germany signed a deal yesterday with its four top gas utilities to keep two floating liquified natural gas (LNG) terminals fully supplied until March 2024. The terminals, to be located in Wilhelmshaven and Brunsbüttel, are expected to become fully operational by the end of the year, and to fill roughly one-fifth of Germany’s gas demand.

German Economic Minister Robert Habeck described the new terminals as part of an effort "to make ourselves independent and less susceptible to blackmail from Putin … and to give Germany a robust and resilient energy infrastructure, or in this case, gas infrastructure."

Even so, Habeck warned that there is “no guaranteed scenario for next winter” when it comes to securing reliable, alternative energy supplies: “The situation, the challenge, is far too dynamic for that,” he added.

BRITAIN ALSO BRACES FOR GAS CUTOFFS: Britain is slated to receive a rare shipment of LNG from Australia next week, according to data from the firm Kpler, as the U.K. also seeks to diversify its supplies and protect itself from a feared Russian gas cutoff.

Though Britain is home to three of Europe’s largest LNG terminals, Reuters notes, shipments from Australia are relatively rare due to the massive costs of transporting LNG across such a distance, as well as demand from other, closer Asian countries.

The tanker in transit has a capacity of 174,000 cubic meters, and is slated to arrive in southern England on August 22.

CHILDHOOD CANCER LINKED TO PROXIMITY TO FRACKING SITES:  A new study from the Yale School of Public Health found that Pennsylvania children who lived near fracking sites at birth face a heightened risk of leukemia in early childhood compared to their peers who did not live near these sites.

According to the study, published today in the journal Environmental Health Perspectives, children exposed to this type of unconventional oil and gas development, or UOGD, were two to three times as likely to be diagnosed with acute lymphoblastic leukemia between the ages of 2-7 than their peers who did not live near such sites. (The study also took into account other factors that could influence cancer risk).

To date, very few studies have examined the link between children exposed to UOG sites and those diagnosed with acute lymphoblastic leukemia (ALL). Researchers examined data from 2,500 Pennsylvania children, 405 of whom were diagnosed with ALL, which is the most common type of children’s cancer.

“Unconventional oil and gas development can both use and release chemicals that have been linked to cancer, so the potential for children living near UOG to be exposed to these chemical carcinogens is a major public health concern,” Nicole Deziel, an associate professor of epidemiology and the paper’s senior author, said in a statement. Read the full study here.

U.S. ORDERS COLORADO RIVER REDUCTIONS FOR BOTH ARIZONA AND NEVADA: Federal officials ordered Arizona and Nevada yesterday to reduce the amount of water they can draw from the Colorado River, the second mandatory cuts to be ordered in as many years—and ones that come after both states failed to meet a federal deadline proposing ways to cut their water usage by 15%.

"We are taking steps to protect the 40 million people who depend on the Colorado River for their lives and livelihoods," Bureau of Reclamation Commissioner Camille Touton said yesterday.

Under the new cuts, Arizona will receive a cumulative total of 21% less than its normal share of water from the Colorado River. Nevada will lose roughly 8% of its total supply.

Western states are scrambling to preserve water supplies amid drought conditions, which have caused water levels at Lake Mead, the largest U.S. reservoir, to fall to historic lows. Federal officials have said state water reductions ranging from 15% to 30% could be necessary to ensure there is no disruption to water deliveries and hydroelectric power production in the West.

FEMA’S NEW FLOOD INSURANCE RATES PROMPT HUNDREDS OF THOUSANDS TO DROP COVERAGE: In the months since the Federal Emergency Management Agency announced it would overhaul its flood insurance program to more accurately reflect flood risk, hundreds of thousands of Americans have dropped their flood policies completely—exposing them to potentially catastrophic financial loss.

According to records obtained by E&E News, roughly 425,000 Americans have discontinued their coverage through FEMA’s National Flood Insurance Program since the program (and prices) were updated in October. The number of policies has dropped by nearly 9% in total, though it is unclear how many have switched to private insurers.

Still, the decline in FEMA coverage has raised fears that more people will not be able to recover financially in the event of a devastating storm—especially as hurricanes are expected to increase in the years to come.

The Rundown

New York Times Lawyer who defeated Cheney spent career fighting environmental rules

Financial Times EU digs for more lithium, cobalt and graphite in green energy push

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Calendar

THURSDAY | AUGUST 18 

1 p.m. Vinson & Elkins will hold a virtual panel to discuss current foreign investment and national security priorities of the U.S. Department of Energy. Speakers will include Michael Considine, the Deputy Assistant Secretary at the DOE’s of Foreign Investment and National Security, and Richard Sofield, the former director of foreign investment review at the Justice Department’s National Security Division. Learn more and register for the event here.

FRIDAY | AUGUST 19 

11 a.m. The United States Energy Association (USEA) will hold a briefing titled, "A New Day for Nuclear Power." See the list of speakers and register here.