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NEW PRESSURE ON INTERIOR: The clock is ticking on the Interior Department’s directive from Congress to award bids in accordance with Lease Sale 257, the lone offshore oil and gas lease sale carried out last year but which was subsequently smacked down by a federal judge.

Democrats’ Inflation Reduction Act provides for the “reinstatement” of the November 2021 Gulf of Mexico lease sale, ordering the department to accept the highest bid for each tract that was offered within 30 days of the bill's passage and to do so “without modification or delay.”

The directive is one thing, but the new law also ties the issuance of new offshore wind leases to the sale of oil and gas leases in the Outer Continental Shelf, potentially meaning the Biden administration will have to reinstate the sale if it wants to keep to its schedule and award wind leases it aims to put up for sale in September.

Catch up on L257: Interior held 257 on Nov. 17, but environmental groups later sued and won vacatur of the department’s record of decision. Judge Rudolph Contreras ruled that its NEPA review was deficient and remanded the ROD back to the agency, without specific instructions as to how or when the agency had to draw up a new ROD. No leases were ever awarded in the sale.

The American Petroleum Institute and other industry groups appealed the ruling, while the Biden administration declined to participate. The government later argued in a June 27 filing that it was unable to complete Contreras’s remand order because the time required to finish another draft supplemental NEPA analysis, take and review comments, issue a new record of decision, and then carry out a new Lease Sale 257 would run past the life of the 2017-2022 offshore program in which the sale was contemplated.

The government submitted a filing yesterday containing language from the IRA to notify the court of the leasing provisions, including the requirement that Interior reinstate 257, and said the federal defendants are reviewing the legislation and considering its effect on the litigation.

Interior spokesperson Melissa Schwartz said via email the department has “nothing to offer beyond the language in the Act right now.”

Where things stand: One oil and gas industry source expressed confidence that Congress’s direction to reinstate the sale and the other leasing provisions would end up superseding Contreras’s decision, saying he thought it would be difficult for any judge to justify blocking such a clear directives from Congress.

Environmental groups are not sitting idly by. Hallie Templeton, legal director for Friends of the Earth, which led the suit against 257, said the leasing provisions have made things “messy.”

Congress is “basically snubbing their nose at checks and balances” with its instructions on Lease Sale 257, Templeton told Jeremy. She said Congress was flouting NEPA and the judiciary on 257, effectively trying to work around Contreras’s ruling.

“We are not ruling out litigation over a future agency action,” she said, adding that NEPA and other environmental laws “are in place for a reason.”

A win elsewhere for greens: Templeton said she was encouraged by a ruling in a separate case yesterday, which vacated District Judge Terry Doughty’s preliminary injunction against President Joe Biden’s pause on new oil and gas leasing.

A panel of the Fifth Circuit Court of Appeals found Doughty’s order enjoining the administration from implementing a leasing pause to be technically deficient and remanded it back to the lower court.

Kathleen Sgamma, president of the Western Energy Alliance, emphasized that the appeal court’s decision did not rule on the merits of the case. WEA is litigating its own case in a different court against the Biden administration for not holding quarterly onshore oil and gas lease sales.

“We’re hoping the judge rules soon, since the Interior Department has not taken any actions for onshore lease sales since the June sales,” Sgamma said about the case. The onshore lease sales performed in June are the only yet to be carried out since Biden took office.

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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RENEWABLES TO COMPRISE NEARLY ONE QUARTER OF GENERATION THIS YEAR: Renewable energy generation is expected to comprise 22% of U.S. electricity generation this year, according to a new report from the Energy Information Administration — a trend it expects to continue as more wind and solar come online.

The EIA’s short-term energy outlook sees an increase in U.S. renewables from previous years, which accounted for 20% of electricity generation in both 2020 and 2021. In 2023, EIA said, it expects renewables to account for 24% of total U.S. electricity generation.

The two U.S. regions that saw the largest shares of renewable generation in 2021 were the Northwest, where renewables comprised roughly half of electricity generation, and California, where renewables accounted for a slightly smaller 44%. Read more on EIA’s findings here.

RUSSIAN GAS CUTS HAVE UNIPER AT ‘BRINK OF INSOLVENCY’: Germany’s largest gas importer, Uniper, posted a loss of $12.5 billion for the first half of 2022, saying yesterday that it has been pushed to the “brink of insolvency” following an abrupt halt of gas deliveries from Russia.

Uniper CEO Klaus-Dieter Maubach said Russian gas cuts were responsible for more than half of the company’s recorded losses, adding that Unier has become a “pawn” in Russia’s war in Ukraine.

“In Germany … there is not a single energy company that such a development would not bring to its knees,” Maubach said yesterday, noting that Uniper has lost an average daily loss of $60 million since mid-June, when Russia first began to reduce its gas deliveries via the Nord Stream 1 pipeline.

“We do assume that Gazprom, if it wanted to, could considerably increase its gas deliveries through Nord Stream 1,” he said, adding that gas prices remained deeply volatile due to “concerns about the reliability of energy supply.” Maubach also said Uniper is examining legal steps against Russian state-owned gas giant, Gazprom, for the abrupt halt in supplies.

Uniper received a $15 billion bailout from the German government last month, in exchange for a 30% equity stake. Lawmakers also advanced a new gas levy that will allow utilities to pass on a portion of costs to customers beginning in October.

Maubach said Uniper is expecting losses to continue for the remainder of 2022, though he added that it would be “almost impossible” to predict the company’s performance in the second half of the year. The utility is scrambling to build out infrastructure for a floating LNG terminal, which it hopes to bring online before the end of the year.

RUSSIA ATTEMPTS ‘UNPRECEDENTED’ CYBERATTACK AGAINST UKRAINIAN NUCLEAR OPERATOR: Ukrainian state-owned nuclear operator Energoatom said this week that Russian hackers launched their most ambitious cyberattack to date on its official website. Though the hackers did not appear to breach the site, the attack underscored the pervasive threats, both digital and physical, that Russia poses to Ukraine’s fleet of 15 nuclear reactors.

Daily shelling near the Zaporizhzhia nuclear power plant in Ukraine has continued to intensify, sparking international fears of a possible nuclear catastrophe.

Earlier this week, 41 countries, including EU members and the U.S., demanded Russian forces “immediately withdraw” from the nuclear plant, saying in a joint statement that it is "undeniable that Russia's invasion and its continued presence at Ukraine’s nuclear facilities significantly raise the risk of nuclear incidents and accidents.”

The shelling at Zaporizhzhia also prompted strong condemnation from UN Secretary-General António Guterres, who described the situation as “suicidal.”

Guterres traveled to Ukraine today to meet with Ukrainian President Volodymyr Zelensky and Turkish President Recep Tayyip Erdogan. Following their meeting, Zelensky said they had reached agreement to allow an international team of nuclear inspectors with the U.N.’s International Atomic Energy Agency to visit Zaporizhzhia in an effort to ensure the safety of the plant. It is unclear whether Russia will agree to the arrangements.

In his nightly video address yesterday, Zelensky reiterated his demand that Russian troops leave Zaporizhzhia, stressing the need for “absolute transparency and control of the situation” by nuclear experts from the IAEA.

DODGE UNVEILS PLANS FOR FULLY ELECTRIC MUSCLE CARS; WILL HALT GAS-POWERED CHALLENGER, CHARGER MODELS: Dodge unveiled plans for a fully-electric concept muscle car yesterday, the Charger Daytona SRT, as part of the company’s broader effort to transition to all-electric vehicles.

Dodge announced this week that it will halt production of its popular gas-powered Challenger and Charger models beginning in 2023, the Washington Examiner’s Jenny Goldsberry reports.

The final gas-powered Challenger and Chargers—as well as seven other heritage-influenced models—will be available for purchase at the automaker’s top dealerships on a first-come, first-serve basis, as well as at the Specialty Equipment Market Association Show in Las Vegas in November.

EU WARNS OF MORE PAIN AHEAD AMID WORST FIRE SEASON ON RECORD: EU leaders said today that the bloc is on track for its worst fire season on record. As of mid-August, the bloc has recorded 2,300 fires—up significantly from 2006 to 2021, when it saw an average of 1,349 fires annually.

In total, the land burned so far this year is roughly four times the size of Monaco; quadrupling the surface area burned in 2006, when the EU first began keeping such data. And this season alone, leaders said they have dispatched 29 aircraft, eight helicopters, and nearly 370 firefighters across at least a dozen EU countries to fight the fires.

The vulnerable areas are also expanding: Unlike previous years, when wildfires were concentrated in the Mediterranean, EU officials said they continue to burn through more territory in central and northern Europe, including Spain, Portugal, and France, which all saw major fires this summer.

And since Europe’s fire season does not end until October, leaders warned that more territory could be at risk as high-heat conditions and drought continue.

NEW FEMA EFFORT SEEKS TO ENGAGE NATIVE AMERICAN TRIBES ON CLIMATE: The Federal Emergency Management Agency announced a new plan today aimed at increasing engagement with more than 570 Native American tribes as they navigate the effects of climate change and climate change-related disasters.

As part of the new plan, FEMA said it has earmarked more than $50 million in grant funds for tribes who are dealing with extreme weather conditions, and will begin offering more training to tribes on how to navigate applying for FEMA funds in the aftermath of a natural disaster—a complex and often lengthy process.

In addition, tribal liaisons will begin briefing FEMA annually on how prepared the tribes are for climate change-related disasters.

“We are seeing communities across the country that are facing increased threats as a result of climate change,” FEMA Administrator Deanne Criswell told reporters on a conference call announcing the effort. “What we want to do in this strategy is make sure that we can reach out to tribal nations and help them understand what the potential future threats are going to be.”

The Rundown

New York Times A frustrating hassle holding electric cars back: broken chargers

E&E News N.J. pipeline project could shake up FERC gas reviews

Washington Post Why the climate bill’s impact might not match what many expect

The Guardian Major cities blighted by nitrogen dioxide pollution, research finds

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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.