Daily on Energy: Randy Weber’s plea for the Jones Act

WHAT’S HAPPENING TODAY: Good afternoon and happy Tuesday readers! Temperatures are on the rise in the East Coast as a summer heatwave is rolling through the area. If you are on the East Coast, here are some ways to stay cool this week. 🫠☀️

In other news, the World Bank has ended its climate financing goal that set out to provide at least 45% of its funding to climate-related projects to help reduce greenhouse gas emissions. 🌍♻️

WEBER ON JONES ACT WAIVER: Republican Rep. Randy Weber of Texas said he does not want Jones Act waivers to become the norm, even as the Trump administration uses them as part of an effort to lower energy prices driven by the war in Iran.

“Whatever it might be, whether it’s war over the Gulf … we don’t want the first thing to happen is they veer away from American shipping, we want American ships, American sailors,” Weber told Maydeen earlier today. 

Since March, the Trump administration has issued a waiver to the Jones Act, allowing refiners to use foreign-flagged ships to transport fuel between U.S. ports. The waiver is part of the administration’s broader effort to lower oil and gasoline prices, which have remained elevated due to the war in Iran.

Weber acknowledged that the situation in Iran remains complicated, with strikes still occurring, but said the waiver “ought to be coming off as quickly as we can.” 

He added that he told Energy Secretary Chris Wright earlier this month during a hearing that the Jones Act should be reinstated as soon as possible.

Some have argued that waiving the Jones Act would not substantially lower prices for consumers.

“It hasn’t had as good of an impact as we would have liked to see it have,” Weber said. “That’s another reason why we’re saying, look, let’s keep American vessels in the scheme of things going on.” 

WORLD BANK SCRAPS CLIMATE FINANCING: The Trump administration has secured another win in its campaign to end climate-related policies and regulations on the international stage, forcing the World Bank to retire its ambitious climate financing goals. 

The World Bank Group announced yesterday that it was retiring its goal of 45% of its funding being dedicated to climate-related projects, with the aim of reducing greenhouse gas emissions from the largest emitters while propping up developing countries in need of resources to adapt to climate change. 

The bank is preserving its broader climate-related framework, known as the Climate Change Action Plan, and will have an independent group conduct an evaluation of the plan. 

“We will retire the 45% climate co-benefits target,” the bank said, saying that the goals have done “significant work in answering client demand and needs.” 

The 45% target was set following the United Nations’ climate conference in 2023, pledging the funding to climate-related projects by 2025. The bank exceeded that goal last year, committing 48% of its financing, or around $39.2 billion.

What to expect: Gautam Jain, a senior research scholar at Columbia University’s Center on Global Energy Policy, told Callie this week ditching the financing goals will also make it more difficult for nations to deliver on climate mitigation targets outlined in the Paris Agreement, such as lowering greenhouse gas emissions. 

During the 2024 United Nations Climate Conference, nations agreed to contribute at least $300 billion in climate finance annually, with about half to two-thirds being sourced from multilateral institutions led by the World Bank. 

“With the U.S. not contributing currently, it will make achieving the target — which is already a fraction of $1.3 trillion that’s needed annually — even more challenging,” Jain said.

BIG OIL PRESSURED TO LOWER PRICES AT THE PUMP: The Trump administration is increasing pressure on oil and gas majors to lower prices of gasoline for consumers and match the price falls seen for crude in recent days. 

Last night, President Donald Trump took to social media again to urge retailers to lower gasoline prices – as higher prices at the pump could very well become a sticking point for Republicans during the November elections. 

“Gasoline Retailers must get their Prices down, IMMEDIATELY! They’re too high considering that Oil is now at $68 a Barrel, and heading south,” Trump said in the Truth Social post. “The Retailers must quickly react to this statement, and do what they know is right — DROP YOUR PRICE FOR OUR GREAT AMERICAN PEOPLE!”

As of this afternoon around 2:30 p.m. EDT, domestic crude benchmakers were back below $70 a barrel. West Texas Intermediate had fallen 1.99% and was selling at $69.34 a barrel. Similarly, Brent crude was down 1.56% and priced at $72.76 a barrel. 

While market prices for oil have significantly fallen in the last few weeks, gasoline prices have been slow to return to around $3 a gallon. This feather-like decline in gasoline prices is largely due to a lag seen from when refiners buy crude and when the refined product is sold. Meaning, oil purchased when prices are high is likely to be sold at a premium once put to market, even if overall prices have dropped. 

As of today, AAA was reporting the national average price of gasoline to be $3.847 a gallon, less than 10 cents lower than where the average was last week. 

Treasury Secretary Scott Bessent upped the pressure on gasoline retailers this morning, warning that the administration would be watching their actions around the July 4th holiday. 

“I ‌would encourage all the gasoline retailers, some of them ⁠are owned ⁠by Big Oil, some are independent, some are international ​convenience chains,” he told Fox News. “I would encourage them to be good actors, especially in the 250th anniversary, ​because we’re watching.”

ANOTHER BP SHAKEUP: BP’s deputy chief executive officer is retiring later this year, causing more turmoil for the British oil major which has seen massive shakeup at its management level in just a matter of months. 

Carol Howle will be retiring less than three months after taking the deputy chief role, according to the Financial Times. She first joined the company via its commercial team in London in 2000, rising through the ranks over the next 25 years. 

In addition to serving as deputy CEO, Howle also worked as head of trading. That position is expected to be replaced by Sam Skerry, who currently works at BP’s head of mergers and acquisitions. 

BP has allegedly said that it agreed Howle’s position would be temporary, however, the Financial Times reported that the company never made that information public. 

Some background: Over the last few months, BP has undergone significant changes amongst its leadership. Earlier this month, the company’s head of global gas and low-carbon energy business said he was leaving after 30 years with the company. And one week prior, BP ousted its board chair Albert Manifold over concerns regarding his conduct. 

The shakeups have come as the company has shifted away from its clean energy strategies and pivoted back to focusing primarily on its oil and gas business. 

FCC SEEKS TO BAN CHINESE-INVERTERS: The Federal Communications Commission is drafting a rule to ban foreign-made inverters due to concerns that China could use the devices to disrupt the power grid. 

Reuters reported that the rule would apply to new foreign models of inverters and could be published as early as this year. Inverters are devices used to convert power produced by solar panels or stored in batteries into electricity for homes or businesses. 

China is a global producer of inverters, led by companies Sungrow Power Supply and Huawei. It was reported last year that U.S. experts discovered rogue communication devices inside Chinese solar power inverters after taking apart grid-connected equipment to check for security issues. 

Reuters noted that the Trump administration previously considered banning Chinese inverters through the Commerce Department but those efforts were stalled. It added that sources said the administration revived its efforts in part due to the European Commission’s ban on Chinese inverters in May. 

SURVEY SHOWS VOTERS SUPPORT MAKING DATA CENTERS PAY THEIR FAIR SHARE: A survey conducted by the American Edge Project and Mercury Analytics has found that as voters are overwhelming in support of building out artificial intelligence for jobs, innovation, and American competitiveness, Big Tech needs to pay for the electricity these power-hungry facilities consume. 

The survey, which was conducted in March and April with the results released this week, found that a majority of voters believe high energy consumption connected to AI is “worth it,” when it is tied to specific outcomes. For example, 76% said the high energy use was “worth it” if it leads to more health care breakthroughs, 74% said it was “worth it” for lowering energy day costs, and 72% said it was “worth it” for strengthening the U.S. economy. 

Voters across the political spectrum are in agreement that tech companies developing AI and data centers should commit to covering the costs of the high energy use, as detailed in the voluntary commitments of the Ratepayer Protection Pledge. 

Roughly 72% of Democratic voters and 76% of Republican voters support the pledge. “MAGA Republicans” had the largest show of support for the pledge at 78%, while only 56% of Independent voters said the same.  

Can’t remember what the Taxpayer Protection Pledge is? The pledge is broken into five main promises, the first being to build, bring, or buy all new energy needed for their data centers and to pay the full cost of infrastructure upgrades as needed to support their operations. The second promise is to pay for all new power-delivery infrastructure upgrades required to service their data centers. 

The third is to voluntarily negotiate new separate rate structures with utilities and states. The fourth section includes a promise to invest in local communities where the companies build data centers by hiring locally and establishing programs to develop relevant skill sets. And the final section includes a pledge to coordinate with grid operators to make backup generation resources available during times of scarcity. 

TEXAS CITY DATA CENTERS FACES CHALLENGES FROM STATE SENATOR: San Marcos, a small town in Central Texas, became the first city in the state to ban centers this month. However, those efforts are now being challenged by state Sen. Paul Bettencourt. 

The San Marcos City Council in June voted 4-3 to make data centers ineligible in the city’s zoning laws. There were concerns over data centers impact over water and energy resources. Bettencourt said this week he plans to appeal the ban, arguing that the ban defies state laws. 

“They should not use zoning to ban anything everywhere in the city, because that’s not lawful under the state of Texas guidelines,” Bettencourt told the Texas Tribune Monday. 

There’s been growing concerns raised by communities across the country over data centers impact on water, energy, and noise pollution. The mounting concerns have pushed local communities and cities to start proposing and implementing regulations and data center bans.