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THE LATEST ON RUSSIAN GAS THROTTLING: Just six months ago, Germany and Russia were finalizing plans for Nord Stream 2, the massive gas pipeline that would have doubled Russia’s deliveries to Berlin and German Chancellor Olaf Scholz was trying to keep the project alive even in the face of the feared invasion of Ukraine.
Today, Scholz and the rest of the EU find themselves in a wildly different situation, staring down the worst energy crisis in a generation and, as of yesterday, supporting the emergency construction of a once-shelved gas pipeline (known as the Midi-Catalonia, or MidCat project) that would link Portugal, Spain, and France to central Europe.
And, of course, Scholz and other European leaders are trying to demonstrate that Russia’s excuses don’t hold up and that it is intentionally throttling gas shipments.
What’s happening with Russian gas deliveries: In early July, Russia slashed gas deliveries via its Nord Stream 1 pipeline to just 20%, forcing Western countries to embrace once unthinkable steps, such as returning to coal-fired plans and, more recently, dusting off plans for the MidCat pipeline in order to keep its grid powered through winter.
As one might recall, Russia had blamed a faulty 29-foot Nord Stream 1 turbine sent to Canada earlier this summer as its reason for slashing gas supply to the EU by half; saying repairs were needed before it could resume normal deliveries.
(In fact, the turbine in question was later revealed to be a spare not needed for functioning of the pipeline—a simple detail that still took weeks to be publicly confirmed.)
Russia’s demands put Justin Trudeau’s government, and the Montreal Siemens Energy plant tasked with its repair, in a fraught situation—and at risk of exacerbating Europe’s gas crisis, Canada granted a rare sanctions exemption to Siemens, whose engineers worked at record speed to repair and return the piece to Europe (by plane rather than freight, to further speed up the delivery), in mid-July.
Its transport was purposely shrouded in secrecy—with both Siemens and Ontario refusing multiple requests for comment—in order to ensure safe and quick return to Russia.
It was shipped to Europe on July 18, according to Russian media outlet Kommersant, which said then that Russian state-owned energy giant, Gazprom, planned to collect the turbine on July 24.
Not so, however. Moscow has since refused to accept it, accusing the West of failing to provide proper documentation for its transport back to Russia, and blaming the lack of documentation for the ongoing gas reductions. Siemens and Germany have both dismissed that claim outright, saying there is no other paperwork needed.
In response, Russia fired back last week with yet another rationale to justify the ongoing gas cuts. Gazprom said in a statement that three additional turbines now also need major overhauls, claiming the pipeline cannot function properly without it. And it said just one of Nord Stream’s six turbines was operating properly—a deeply implausible scenario, at best.
For now, the spare turbine remains untouched at a Siemens factory in Germany, the location revealed for the first time only after Scholz visited last week to show the public that the piece is fully intact, operational, and ready for transport on Russia’s orders.
It was an event designed to highlight the absurdity of Russia’s claims, and to drive home a theory now widely accepted by the EU—that Moscow is weaponizing its energy supplies in an effort to weaken the EU.
“It is obvious that nothing, nothing at all, stands in the way of the further transport of this turbine and its installation in Russia. It can be transported and used at any time,” Scholz told reporters, stopping momentarily to pose for photos in front of the turbine.
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U.N. SEC-GEN WARNS OF POTENTIAL ZAPORIZHZHIA ‘DISASTER’: United Nations Secretary-General António Guterres issued a new and urgent warning about conditions at the Zaporizhzhia nuclear power plant in Ukraine—citing new reports of “further deeply worrying incidents” in recent days “that could, if they continue, lead to disaster.”
Russian forces have recently increased their shelling in areas near the plant. Kyiv said that the complex was struck five times yesterday alone—including areas near where nuclear materials are stored.
Guterres urged both Russian and Ukrainian military personnel to withdraw from the area and “refrain from any further deployment of forces or equipment to the site.”
“We must be clear that any potential damage to Zaporizhzhia or any other nuclear facilities in Ukraine, or anywhere else, could lead to catastrophic consequences not only for the immediate vicinity, but for the region and beyond,” he said, adding that he is “gravely concerned” about the situation there.
RUSSIA FIRES BACK: Russian ex-president Dmitry Medvedev issued a thinly-veiled threat to the rest of the EU today, describing assessments that Russia carried out the recent shelling as “obviously 100% nonsense.”
“What can I say? Let’s not forget that the European Union also has nuclear power plants,” said Medvedev, now deputy chairman of Russia’s Security Council. “And accidents can happen there, too.”
BRITS SHOULDERING TOUGH DROUGHT CONDITIONS: British authorities declared drought conditions in eight different regions in England today, including London and virtually the entire southern portion of the country.
The National Drought Group announced the conditions in the midst of Britain’s second heatwave of the summer. Temperatures over the next few days are expected to be lower than the triple-digit (Farenheit) temperatures endured during July’s heatwave but elevated enough to merit excessive heat warnings.
The NDG concluded that water supplies are safe in the face of it but Harvey Bradshaw, who chairs the National Drought Group, said the dry conditions “have exacerbated pressures on wildlife and our water environment.”
July was the driest month across England since 1935, and for the East and South East, it was the driest month on record, the British Environment Agency found.
The Brits are not alone. Across the channel, France is reckoning with its own drought conditions, which are forecast to limit crop output.
The heat and drought are also making electricity supply conditions tighter. Power giant EDF has been forced to limit generation from some nuclear plants where river waters needed to cool reactors exceed temperature limits.
MASSACHUSETTS ENACTS NEW GREEN ENERGY LAW: Republican Gov. Charlie Baker signed wide-ranging legislation yesterday designed to encourage development of more green energy, including in the state’s burgeoning wind energy industry.
The new Massachusetts law creates an offshore wind industry investment program to facilitate more renewable energy manufacturing and employment opportunities, as well as a wind energy tax incentive program for offshore wind companies.
It also serves other green priorities by expanding rebates for individual and corporate zero-emissions vehicle purchases and would allow cities to ban hookups for fossil fuels, such as propane or natural gas, in new construction or major building renovation projects.
The bill’s passage coincides with the impending approval of Democrats’ reconciliation bill, which rests on the same green energy and climate change mitigation priorities.
Its provisions are of the sort that a number of environmental groups and analysts have said will be necessary to help make up the difference between the estimated 40% reduction in emissions (relative to 2005 levels) tied to the Democrats’ bill and Biden’s target of a minimum 50% reduction by 2030.
GREEN GROUPS SECURE AGREEMENT TO DELAY NEW LEASING: Environmental groups finalized a settlement agreement yesterday with the Bureau of Land Management that will preclude the agency from selling new oil and gas leases on 2.2 million acres of federal land in southwestern Colorado pending new environmental analysis for the covered areas.
The settlement stems from a lawsuit that Citizens for a Healthy Community, Sierra Club, and a number of other groups filed in 2020 challenging BLM’s analysis for leasing acreage under jurisdiction of its Uncompahgre Field Office. The petitioners argued that BLM failed to adequately consider how new leasing would contribute to climate change, as well as how it would threaten various species in the region, including Gunnison sage grouse.
BLM will have to develop an amended plan for the area to include at least one alternative that reduces oil and gas leasing, and the overall process is expected to take two years, according to Sierra Club.
Taylor McKinnon of co-petitioner Center for Biological Diversity asked the Biden administration to end new leasing in the area and said “any fossil fuel expansion is flatly incompatible with avoiding climate catastrophes and preserving a livable world.”
The administration’s stated climate policies fall more or less in line with McKinnon’s preferences on leasing, but both BLM and the Bureau of Ocean Energy Management have carried out lease sales after a court put Biden’s leasing pause on hold (the administration is appealing the injunction).
Moreover, beyond the resolution of that litigation, Biden’s ideal of restricting new leasing will be further undercut if the Democrats’ reconciliation bill passes the House as is. It includes explicit directions to BOEM to carry out three canceled offshore oil and gas lease sales and would make the expansion of renewable energy on federal lands and in the Outer Continental Shelf contingent upon new oil and gas leasing.
IOWA TRADE GROUP’S NEW PROGRAM PAYS FARMERS USE BIOFUEL: The Iowa Renewable Fuels Association launched its new On-Farm Biodiesel Credit Program yesterday to incentivize farmers to use the fuel for their agricultural operations.
Iowa farmers filling on-farm tanks can earn 25 cents per gallon for filling up with B11 fuel (11% biodiesel) and 50 cents per gallon for B20. The credit maxes out at $500.
“Biodiesel adds value to soybean oil, corn oil, and animal fats,” said Lisa Coffelt, IRFA marketing director. “So when farmers use biodiesel, not only are they helping the environment, they are also supporting their own bottom line.”
Since we’re on the topic: The Democrats’ Inflation Reduction Act would extend the existing credit of $1 per gallon for biodiesel and renewable diesel through 2024 and provide more than $500 million in grant authority to EPA for biofuels infrastructure.
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House lawmakers are poised to pass the the Inflation Reduction Act. Time TBA.