Fossil Fuels Necessary in Clean Energy Transition, Granholm Says

Traditional fossil fuels like oil, gas, and coal still have a role to play in the transition to a clean energy economy, President Joe Biden’s choice for secretary of energy told senators.

“If we are going to get to net carbon zero emissions by 2050, we cannot do it without coal, oil, gas being part of the mix,” Jennifer Granholm said in response to Sen. Steve Daines (R-Mont.) at Wednesday’s Senate Energy and Natural Resources Committee hearing on her nomination. She said she did not believe the fossil fuels should be completely taken out of the country’s energy portfolio.

The former Michigan governor added that the Energy Department needs to continue investing in carbon capture, utilization, and storage research and development to ultimately reach that 2050 goal.

Photographer: Graeme Jennings/Washington Examiner/Bloomberg

Granholm testified at the Senate Energy and Natural Resources Committee on Wednesday.

Granholm carefully responded to Republican and Democratic senators’ worries over how the administration’s clean energy goals and a move away from fossil fuel production would affect workers—their constituents—in those traditional industries. She acknowledged that Biden’s executive order pausing new fossil fuel production on federal lands is a concern for states such as Wyoming, West Virginia, and New Mexico that “have these jobs in abundance.”

Biden Climate Plan Includes Oil-Lease Pause, Subsidy Review

“The Biden administration is not going to take their jobs away on existing leasing,” Granholm told Sen. Cindy Hyde-Smith (R-Miss.), who asked the nominee what she was supposed to tell her anxious constituents. Mississippi’s economy is tied to offshore drilling.

Granholm said the executive order only affects new, prospective onshore and offshore leases. “This gives us time to work on the technologies that will reduce greenhouse gas emissions that will keep people employed,” she said.

Bipartisan Job Loss Concerns

Democrats, including Sens. Joe Manchin (W.Va.) and Martin Heinrich (N.M.), also expressed concern over potential job losses in their energy-producing states.

Manchin, who will lead the committee when it formally organizes and expects to hold his first hearing next week, issued a gentle warning to the Biden administration.

“If they come out and say, ‘We’re going to eliminate this, moratorium on that,’ it makes it much more difficult for us in a bipartisan way to be helpful and constructive,” he said, gesturing toward the Republican side of the dais. “I think they are listening,” he said of the administration. “I hope they do.”

Sen. John Barrasso (Wyo.), the committee’s top Republican, noted that “collectively, we are the resource anchor for the country,” referring to states like Wyoming, West Virginia, Alaska, and New Mexico.

“I believe that the people who work in those sectors now and in the past, are like our nation’s energy veterans,” said Heinrich, whose state just broke ground on a large wind farm. “These are men and women who have powered this nation for the last half century and gave their working lives to that goal.”

While the transition to a clean energy future “is incredibly important,” Heinrich said, “it’s not going to be easy.”

Granholm committed to Heinrich that if confirmed as energy secretary, she would ensure there were “place-based” strategies that help states maximize their unique attributes to help workers transition and stay in their communities. “Every state has something to offer” when it comes to moving toward a clean energy future and economy, she said.

‘Seared My Soul’

Granholm said the administration, through its executive order, will put together a federal government “swat team” to help communities that have traditionally powered America and ensure those workers aren’t left behind.

She said her experience as Michigan governor during the Great Recession working with the auto industry and addressing the job loss and anxiety of workers “seared her soul.” But when “we focused on incentive to locate for jobs in clean energy, they came,” Granholm said.

“I can’t tell you how important this is to me personally, that we don’t leave people behind,” she said, citing the Biden administration’s commitment to invest in traditional fossil fuel-producing communities as well as areas that have borne the brunt of pollution to help them transition to a clean energy economy.

Outgoing Chair Lisa Murkowski (R-Alaska) said she doesn’t want to keep her state that has experienced first-hand the effects of climate change “back in time” but reiterated the anxiety that many Americans in fossil-fuel producing states are feeling right now. “My state of Alaska, it’s our oil resources that have allowed us to build our schools and roads.”

Granholm is likely to win backing by the committee when it meets to advance her nomination, and drew vocal support from Manchin at Wednesday’s hearing.

“We are very fortunate to have such a well-qualified and talented nominee for the important position of secretary of energy,” Manchin said in his opening remarks. “I wholeheartedly support your nomination, and am very pleased to welcome you to our committee.”

To contact the reporter on this story: Kellie Lunney in Washington at klunney@bloombergindustry.com

To contact the editors responsible for this story: Zachary Sherwood at zsherwood@bgov.com; Giuseppe Macri at gmacri@bgov.com