The chances of the 114th Republican-led Congress reaching compromise with the White House on key legislation are dim, according to John Kneiss, director, Stratas Advisors, a Hart Energy company.

Kneiss, an energy public policy expert with more than 25 years of experience who is based in Washington, spoke at Hart Energy’s recent Marcellus-Utica Midstream Conference.

In the past a divided government, where one party controlled the Congress and the other party held the White House, has resulted in a more pragmatic government where “things got done,” Kneiss said. However, he does not think that will happen now.

“But the good news is gridlocked government can’t do much harm,” he added.

Some progress, however, is being made. Since the new Congress convened in January, the Senate has approved more than 24 amendments, compared to 2014 in which only seven made it through the chamber.

Kneiss outlined proposed federal legislation making its way on Capitol Hill that could affect and assist the midstream community:

  • H.R. 351 (Rep. Johnson, R-Ohio) and S. 33 (Sen. Barrasso, R-Wyo.) would require the Department of Energy to issue final decisions on LNG export license applications within 60 days, which would expedite judicial review; and
  • H.R. 161 (Rep. Pompeo, R-Kan.) would accelerate the Federal Energy Regulatory Commission’s review of infrastructure/pipelines (passed in House; administration veto threatened).

Regulatory action to watch is the Environmental Protection Agency’s (EPA) methane and volatile organic compound (VOC) emissions control, which is part of the Climate Action Plan to reduce emissions by 45% by 2025 only for new and modified oil and natural gas wells, according to Kneiss.

“Of course, the sections of the Clean Air Act that the agency is using may allow them to proceed to develop controls for existing systems,” Kneiss said.

Another regulatory issue Kneiss explained is the EPA’s ozone National Ambient Air Quality Standard. The EPA has proposed lowering the standard from 75 parts per billion (ppb) to between 65 ppb and 70 ppb.

“If they said 65 ppb, it would put as much as 90% of the country in a non-attainment status. It would dramatically increase areas throughout the country that would have to monitor for ground-level ozone, and states would have to modify their implementation plans for how they intend to control VOC emissions, including methane. That could limit manufacturing and E&P. It could be one of the most costly regulatory standards ever developed,” Kneiss said. Most of Pennsylvania, Ohio and West Virginia would be brought into regulatory requirements, he added.

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