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Jamie Dimon: Eminent Domain for Renewables

JPMorgan Chase CEO Jamie Dimon has called for potentially radical reform of permitting requirements that he believes sandbag clean energy development in America.

Dimon, whose annual letter shareholders glean for insights on the US economy writ large, called for a new “Marshall Plan for America.” Such a plan would focus on student debt and infrastructure, while addressing “threatening clouds” hanging over the US economy.

“[P]ermitting reforms are desperately needed to allow investment to be done in any kind of timely way,” Dimon wrote in his letter. “We may even need to evoke eminent domain – we simply are not getting the adequate investments fast enough for grid, solar, wind and pipeline initiatives.”

Dimon then implied that the Bipartisan Infrastructure Law, the Creating Helpful Incentives to Produce Semiconductors (CHIPS) and Science Act, and the Inflation Reduction Act (IRA) could not be successfully implemented without the use of eminent domain—the state seizure of private property.

Dimon cited climate change as a reason to pursue radical and aggressive permitting reform. “The window for action to avert the costliest impacts of global climate change is closing,” he wrote. “The need to provide energy affordably and reliably for today, as well as make the necessary investments to decarbonize for tomorrow, underscores the inextricable links between economic growth, energy security and climate change. We need to do more, and we need to do so immediately.”

More energy projects besides wind and solar could benefit from permitting reform, which has inspired a bi-partisan push to tackle it. But suggesting that emergency conditions brought on by climate change necessitate the invocation of eminent domain is concerning.

China Ponders Rare Earth Export Ban

China wants to ban the export of technologies used to produce high-performance rare earth magnets, citing "national security" as a reason.

“Beijing is currently in the process of revising its Catalogue of Technologies Prohibited and Restricted from Export — a list of manufacturing and other industrial technologies subject to export controls — and released a draft of the revised catalog for public comment in December,” reports The Japan News. “In the draft, manufacturing technologies for high-performance magnets using such rare earth elements as neodymium and samarium cobalt were added to the export ban. The solicitation of comments ceased late January and the revisions are expected to be adopted as early as this year.”

Rare earth magnets are key components in electric vehicles, wind turbines, aircraft, and other products. China likely aspires to control the magnet supply chain as the global pursuit of decarbonization drives a shift towards green tech.

Western countries have been trying to decrease their dependence, but an export ban would still deal a significant blow. “[W]hile China's share of all rare earths produced globally dropped to roughly 70% last year from about 90% a decade earlier, according to the U.S. Geological Survey, China still remains the dominant producer of rare earths,” reports Oilprice.com. “Furthermore, China still holds a tight grip on processing rare earths. Ironically, most rare earths extracted in the U.S. go to China for refining before being shipped back to the U.S.”

Markets+ Begins in Southwest Power Pool

A group of utilities, power generators, market participants, and climate advocates have signed agreements to participate in the first phase of Southwest Power Pool’s Markets+ initiative in the West.

The initiative will expand on SPP’s Western Energy Imbalance Services market and establish an independent governance structure. “As part of the first phase, Markets+ participants and stakeholder representatives will meet in committees and working groups to develop market protocols, tariff and governing documents that SPP must file with the Federal Energy Regulatory Commission for approval,” reports Utility Dive. “SPP’s WEIS began operating two years ago.”

However, signing on to the development phase does not necessarily mean entities will participate in the market. The deadline for interested parties to sign up for the early phase of SPP’s Markets+ initiative passed on Monday, though the grid operator said it had already begun development after funding reached a “critical mass” a month ahead of schedule.

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Conversation Starters

1. Japan continues to heal from the Fukushima incident. “The area of Tomioka, southwest of the wrecked Daiichi Nuclear Power Plant, was evacuated following the disaster in March 2011,” reports Sky News. “Its reopening was celebrated on Saturday, in time for the popular cherry blossom season. Former residents and visitors celebrated as they strolled along a street known as ‘the cherry blossoms tunnel.’”

2. A government was likely responsible for the Nordstream sabotage. “A state actor's involvement in the blast of the Nord Stream pipelines last year is the "absolute main scenario", though confirming identity will prove difficult, the Swedish prosecutor investigating the attack said on Thursday,” reports Reuters. “In September 2022, several unexplained underwater explosions ruptured the Nord Stream 1 and newly-built Nord Stream 2 pipelines that link Russia and Germany across the Baltic Sea. The blasts occurred in the economic zones of Sweden and Denmark and both countries say the explosions were deliberate, but have yet to determine who was responsible.”

3. Fears of power market manipulation persist in Britain after Bloomberg published an investigation into the matter. “UK Energy Security Secretary Grant Shapps called on the regulator to investigate whether power trading firms are manipulating the country’s electricity markets to boost their profits at the expense of consumers,” reports Bloomberg. “This Bloomberg investigation clearly shows Ofgem needs to properly look into this and identify if this is market manipulation or based on genuine need,” Shapps said in a statement. “But I want to see them going further and faster, or it will be the taxpayer paying the price for their failure to hold these companies to account.”

Crom’s Blessing