NEW SCRUTINY FOR KEYSTONE CONTRACTOR'S TIES TO ENERGY GROUPS...

By Alex Guillén

NEW SCRUTINY FOR KEYSTONE CONTRACTOR'S TIES TO ENERGY GROUPS: A contractor working on the State Department's environmental review of the Keystone XL pipeline is a member of several energy industry groups that have urged the government to support the project. Climate activists have already complained about alleged conflicts of interest by the London-based firm Environmental Resources Management, a company that worked on a State Department draft study concluding that the pipeline would pose little risk to the environment. While a previous State Department investigation found no conflicts of interest, the latest information could further roil the debate. Andrew Restuccia and Byron Tau have the story: http://politi.co/1fA06FE

INTERIOR, CSB NOMINEES COULD GET CONFIRMED BEFORE CHRISTMAS: Some energy nominees may get a last-minute Christmas gift if Senate Majority Leader Harry Reid has his way. Reid has filed cloture on several more nominations for the Senate to tackle before it breaks for winter recess - and his list included Mike Connor, the nominee for deputy Interior Secretary, and Richard Engler to join the Chemical Safety Board. Before senators get to Connor, Engler and other nominees, they'll have to tackle the budget bill passed last week by the House and an annual defense authorization bill.

Speaking of CSB: Via Reuters: "The U.S. Chemical Safety Board on Monday called on California officials to adopt new rules for crude oil refineries that would force owners to prove they can operate their plants at the lowest risk practicable, the federal investigative agency said. An interagency working group representing California state agencies recommended similar action to California Gov. Jerry Brown in July." More: http://reut.rs/1kaWQDu

HAPPY TUESDAY and welcome to Morning Energy. Send your news toaguillen@politico.com, and follow on Twitter @alexcguillen, @Morning_Energy and @POLITICOPro.

MURKOWSKI'S ENERGY EXPORT DAY - JAN. 7: Senate Energy and Natural Resources ranking member Lisa Murkowski will release a white paper and give a speech on energy exports Jan. 7, her office announced Monday. "This isn't about introducing legislation per se but about starting and having a dialog about the issue," Murkowski spokesman Robert Dillon said. Part of the paper will deal with oil exports, an issue that has become increasingly prominent with oil companies starting to argue that the U.S. oil export ban should be lifted amid booming domestic production.

Menendez urges Obama not to list oil export embargo: Even Energy Secretary Ernest Moniz last week suggested that perhaps now was a good time to review whether the export ban is outdated, prompting Sen. Robert Menendez to write President Barack Obama Monday with "deep concerns" over Moniz's comments. "When Congress first enacted limits on crude exports in the 1970s following the oil embargo, these laws were designed to enhance American energy security and protect U.S. consumers from volatility and price spikes," Menendez wrote:http://1.usa.gov/1dj6qyZ . As Moniz emphasized last week, the export ban is under the auspices of the Commerce Department, which has declined to comment on the matter.

STEYER PUSHES OIL EXTRACTION TAX IN CALIFORNIA: California billionaire Tom Steyer is turning his attention toward pushing for an oil extraction tax, his group NextGen Climate Action said yesterday. The Contra Costa Times has more: "The oil industry, which claims such taxes would make California less hospitable to business and increase reliance on foreign oil, put up $95 million to defeat a ballot measure in 2006, and lawmakers have balked at taking the plunge ever since. This 'Reclaim Our Resources' campaign will host public round-table discussions, share research, conduct polling, run advertising blitzes via social and traditional media, and provide policy and media support for like-minded lawmakers. Voters in 2006 rejected Proposition 87, an oil-extraction tax plan, after real estate heir and movie mogul Steve Bing spent about $49.6 million to support it, only to be outshouted by the industry." More:http://bit.ly/18SzkXm

INTERIOR MAKES OFFSHORE WIND ANNOUNCEMENT DELAYED BY SHUTDOWN: The Interior Department today will announce its plans to auction off areas off the coast of Maryland for offshore wind projects - an announcement that was set to come months ago but got delayed because of the shutdown. The area up for grabs (and subject to public comment first) covers almost 80,000 acres and could support up to 1.2 gigawatts of wind power, according to the National Renewable Energy Laboratory. O'Malley has worked to make Maryland for attractive for offshore wind, including recently passed legislation requiring utilities to get 2.5 percent of their electricity from offshore wind by 2017. Map of the proposed lease area: http://1.usa.gov/1ej2AuZ

If you're interested: Interior Secretary Sally Jewell, Gov. Martin O'Malley and BOEM Director Tommy Beaudreau make the announcement at 10:30 a.m. at the Maritime Applied Physics Corporation Headquarters in Baltimore.

ALSO IN OFFSHORE WIND NEWS - CAPE WIND WILL QUALIFY FOR CREDITS: The long-delayed Cape Wind project has begun construction and will qualify for an investment tax credit that is set to expire at the end of this year, according to Siemens, the project's turbine supplier. A spokesman for the 468-megawatt project would only say the company is 'hopeful we will qualify.' The tax credit would be worth around $780 million for Cape Wind. Bloomberg: http://bloom.bg/199mmqQ

But wait, there's more: Siemens said yesterday that a 1,050-megawatt turbine order the company has gotten from MidAmerican Energy Company is the biggest ever onshore wind order in the world. (By comparison, the U.S. has about 60,000 megawatts of installed wind capacity right now). BusinessWeek: http://buswk.co/1cwFOJ9

**More than 500 influential voices in energy. One platform. Chevron is proud to be the originating sponsor of the #EnergyInsider Tweet Hub. Visit the Tweet Hub now to get the latest insights on energyhttp://bit.ly/19mVphp **

CYBER POLICY BRINGS PRIVACY CONCERNS: An Obama administration plan to improve the country's digital defenses has become a makeshift privacy battlefield. A draft set of cybersecurity best practices commissioned by the president and authored alongside industry prescribes that power plants, financial institutions and others should secure their systems by limiting their collection and storage of sensitive customer information - the very data often in hackers' crosshairs. Tony Romm has more for Pros: http://politico.pro/19abAk3

PUMP UPDATE: The average price of a gallon of gasoline in the U.S. is $3.23, up two cents from a month ago but down three cents from both a week ago and the same point last year, according to AAA's weekly report. Factors driving down the national average include the end of some production problems on the Gulf Coast, less seasonal demand and snowstorms keeping many in the mid-Atlantic and Northeast off the roads.

MUST BE NATIONAL AMICUS BRIEF DAY: Senate Minority Leader Mitch McConnell and other lawmakers yesterday wrote in a brief for the Supreme Court that the narrow portion of EPA's greenhouse gas regulations the court is considering go against the will of Congress and step over the administration's authority: http://politico.pro/1c89Vf6. And 75 state and local chambers of commerce wrote in their own brief that the economic consequences of EPA's rule would be 'severe' and that the agency did not consult enough with business interests:http://politico.pro/1cNmdYM

And NAM, others file on EPA 'veto': The National Association of Manufacturers and other business groups filed an amicus brief with the Supreme Court over EPA's "veto" authority over Clean Water Act dredge and fill permits. The Obama EPA retroactively withdrew parts of a permit for a major mountaintop removal coal mine in Mingo County, W.Va., and despite a strong rebuke from a district court judge, the appeals court said the move was within EPA's authority. The brief:http://bit.ly/18SbY44. The high court hasn't decided yet whether to take up the case.

COMING TODAY - FIRST CVD DETERMINATION ON OIL TUBES IMPORTS: The Commerce Department today will announce its preliminary determination for countervailing duties on 'oil country tubular goods' from India and Turkey. OCTG are well casings and metal tubes used in oil and gas wells. The countervailing duties are a small part of Commerce's investigation, which was spurred by a complaint from U.S. Steel Corp. and other companies. Commerce is also weighing anti-dumping duties on OCTG imports from nine countries. Imports from India and Turkey were worth a combined $352.5 million in 2012.

FROM ME'S MAILBAG: DOE should 'conduct a study on operations energy efficiency tools, and ... recommend uniform methodologies for measuring the energy and cost savings from these technologies and services," Sens. Ron Wyden, Mike Crapo and Elizabeth Warren write. Warren and Crapo included an amendment directing DOE to conduct the study to the long-delayed Shaheen-Portman energy efficiency bill. Letter: http://politico.pro/JARaoS

THE OLD WORLD WILL BURN IN THE FIRES OF INDUSTRY: We're a little late on this one, but just had to share: Scientists at the University of Bristol used IPCC data to model what the climate and weather of Middle Earth would have been in 'The Lord of the Rings.' Those carbon-emitting Orcs need more study, the paper concludes. "In particular, given the undoubted variations in CO2 due to the nefarious activities of Sauron and Saruman, evaluating the climate sensitivity of Middle Earth would be an interesting exercise." http://bit.ly/IHf4O9

SIXTY PERCENT OF THE TIME, IT WORKS EVERY TIME: The Fish and Wildlife Service wants to survey residents in parts of Arizona and New Mexico on their feelings about jaguars. Federal Register:http://1.usa.gov/J0GLSj

QUICK HITS

- DOE had to block 2,200 attempts this year by users looking to get data before the wider public. Wall Street Journal: http://on.wsj.com/199MZM8

- Associated Press national political editor Liz Sidoti is leaving to head up BP's U.S. communications. Huffington Post: http://huff.to/J0JjzM

- Kinder Morgan wants to triple the size of a pipelines moving oil from Alberta to the Pacific Coast. Wall Street Journal:http://on.wsj.com/1hfpQaO

- Mexico's state legislatures have approved a plan to let private companies produce oil and gas in the nation. AP: http://bo.st/19upcoe

- Florida Power & Light wants its customers to pay for emissions reduction upgrades to peak demand plants, but not everyone likes that plan. Miami Herald: http://hrld.us/1bVY81V

- A proposed solar project in California may get shot down by regulators over concerns about risks to birds. Mercury News: http://bit.ly/18NpeUq

- Pennsylvania Gov. John Corbett gave a $1 million grant to GE to develop an LNG locomotive. Erie Times-News: http://bit.ly/1c8vvjH

**The energy industry supports 9.8 million American jobs. And every job created by the energy industry creates nearly three more indirect and induced jobs across the economy. This year alone, Chevron is investing $8.9 billion in U.S. energy projects. See what else Chevron is doing to move our economy forward http://bit.ly/JgZoBL **

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