Archive: 2022

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Declaration Of Emergency And Authorization For Temporary Extensions Of Time And Duty-Free Importation Of Solar Cells And Modules From SE Asia
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The Energizer – Volume 101
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EUROPEAN COMMISSION PRESENTS REPOWEREU PLAN
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The Energizer – Volume 100
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2022 Offshore Wind Handbook Now Available
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FERC Moves Forward on Transmission Planning/Cost Allocation Reform
7
Sustainable Outlook: The Push to Modernize the Grid From Smart Buildings With Courtney Blodgett, Director of Strategy at Edo
8
BOEM Issues Final Sale Notice for Offshore Wind Lease Areas in Carolina Long Bay
9
Please Join Us: ESG Insights | SEC Proposed Climate-Related Disclosures
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MCE Clean Energy: Green Hydrogen Expert Roundup

Declaration Of Emergency And Authorization For Temporary Extensions Of Time And Duty-Free Importation Of Solar Cells And Modules From SE Asia

By Stacy J. Ettinger

On June 6, 2022, President Biden issued a declaration of emergency and authorization for temporary extensions of time and duty-free importation of solar cells and modules from SE Asia under 19 USC 1318(a). The basis for the declaration of emergency is the need to ensure electric resource adequacy and address the unavailability of solar cells and modules that is jeopardizing new, planned solar installations.

In short, there is an emergency because the US is unable to import solar modules in sufficient quantities to ensure solar capacity additions necessary to achieve US climate and clean energy goals, ensure electricity grid resource adequacy, and help combat rising energy price.

Statutory authority. The statutory authority cited in the declaration (19 USC 1318(a)) is a catch-all provision that allows the president to authorize CBP to permit duty free entry of certain items if the president declares the existence of an emergency.

Specifically, the statute provides for “the importation free of duty of food, clothing, and medical, surgical, and other supplies for use in emergency relief work.” Expect arguments from stakeholders that solar products don’t fit within the list, but this law is about as good as gets if you want to find a way to stop the application of antidumping and/or countervailing duties (“ADCVDs”).

Here’s how this is going to work—

New Commerce regulation. Commerce likely will publish an interim final regulation – before the date of the preliminary determination in the solar circumvention proceedings – that will allow Commerce to instruct CBP to not collect duties on cells/modules from the four SE Asian countries for a period of 24 months (starting from the date of the proclamation). The new regulation will not apply to the current ADCVDs on imports of Chinese or Taiwanese solar cells/modules.

Current regulations (19 CFR Part 358) set forth the procedures for importation of supplies for use in emergency relief work free of ADCVDs, as authorized under 19 USC 1318(a). These regulations were published in 2006 (71 FR 63230 (October 30, 2006)). 

Commerce will continue with the circumvention inquiries. Commerce officials put out a press release on June 6 clarifying that the agency will continue the ongoing circumvention inquiries. The release states that “whatever conclusion Commerce reaches when the [circumvention] investigation concludes will apply once this short-term emergency period [24 months] is over. In accordance with the President’s declaration, no solar cells or modules imported from Cambodia, Malaysia, Thailand, and Vietnam will be subject to new antidumping or countervailing duties during the period of the emergency. Existing duties on Chinese and Taiwanese imports of solar cells and modules remain in effect.”

Commerce could still go negative at the prelim or final. Commerce is proceeding with the circumvention inquiries related to imports of cells/modules from the four SE Asian countries. Commerce’s preliminary determination is due no later than August 29, 2022; Commerce’s final determination is due by January 26, 2023. Commerce could still issue a negative determination at the prelim or final stage of the circumvention inquiries.

What happens if Commerce goes affirmative? If Commerce goes affirmative, per its regulations it must direct CBP to suspend liquidation and require a cash deposit of estimated duties. Pursuant to the emergency declaration and new regulation, Commerce would have the authority to not follow its regulations. In other words, Commerce would instruct CBP to not suspend liquidation or collect cash deposits for imports of solar cells/modules from the four SE Asian countries.

What could go wrong with this plan? Possible risk is that an interested party to the circumvention inquiries (such as the domestic manufacturer that requested the inquiries) will sue on the new regulation and/or Commerce’s application of the current regulation (19 CFR Part 358), arguing duty free treatment of solar cells/modules is beyond the scope of products covered under the statute (19 USC 1318(a)). The litigation could take at least a couple years to play out.

If the plaintiff were to prevail (and assuming an affirmative final regarding circumvention), suspension of liquidation and estimated duty payments would kick in. It is unclear whether suspension/duty payments would be retroactive (ie, to date of affirmative preliminary determination) or prospective (eg, from the effective date of the final court decision). The latter seems more likely.

The bottom line. Implementation of the Declaration should provide a two year window during which developers and other solar system providers should be able to import panels from Cambodia, Malaysia, Thailand and Vietnam without the risk of retroactive tariffs.

Relevant documents

Declaration of Emergency and Authorization for Temporary Extensions of Time and Duty-Free Importation of Solar Cells and Modules from Southeast Asia | The White House

FACT SHEET: President Biden Takes Bold Executive Action to Spur Domestic Clean Energy Manufacturing | The White House

President Biden Invokes Defense Production Act to Accelerate Domestic Manufacturing of Clean Energy | Department of Energy

Department of Commerce Statement on President Biden’s Proclamation on Solar Cells and Modules | U.S. Department of Commerce

The Energizer – Volume 101

By: Buck B. EndemannMolly K. BarkerMatthew P. ClarkNathan C. HoweNatalie J. ReidMaeve C. Tibbetts

There is a lot of buzz around clean technology, distributed energy resources (DERs), microgrids, and other technological innovations in renewable energy and clean transport industries, and how these developments can contribute to solving longstanding environmental justice issues. As these innovations develop, energy markets will undergo substantial changes to which consumers and industry participants alike will need to adapt and leverage. Every other week, K&L Gates’ The Energizer will highlight emerging issues or stories relating to the use of DERs, energy storage, emerging technologies, hydrogen, and other innovations driving the energy industry forward.

IN THIS ISSUE

  • Department of Energy Announces US$25 Million in Funding to Study Clean Hydrogen for Electricity Generation
  • Department of Energy Announces US$3.5 Billion Carbon Capture Program
  • Hawai‛i Lawmakers Considering a Cap on Renewable Energy

EUROPEAN COMMISSION PRESENTS REPOWEREU PLAN

Policy and Regulatory and Energy, Infrastructure, and Resources Alert

By: Tariq A. FeddaMiguel A. Caramello AlvarezGiovanni CampiInês S. Mendes, Paula Esteban Gomez

The European Commission (the Commission) presented on 18 May 2022 details of its plan to repower Europe and to reduce, and ultimately end, Europe’s reliance on Russian fossil fuels (the REPowerEU Plan or the Plan)1 that was announced on 8 March 2022. 

It aims to do this with three pillars: energy conservation; diversifying supplies; and quickly substituting fossil fuels by accelerating Europe’s clean energy transition, all while smartly combining investments and reforms.

The Plan acknowledges that the shift away from Russian fossil fuels will also require targeted investments for security of supply in gas infrastructure and very limited changes to current oil infrastructure, alongside large-scale investments in the electricity grid and an EU-wide hydrogen backbone. As such, the different elements of the Plan, which comprise a series of proposals, communications and guidance documents, will be of interest to anyone participating in the energy markets in Europe, including developers of renewable and conventional energy projects, buyers and sellers of commodities, and even households. 

The Energizer – Volume 100

By: Buck B. EndemannMolly K. BarkerMatthew P. ClarkNathan C. HoweNatalie J. ReidMaeve C. Tibbetts

There is a lot of buzz around clean technology, distributed energy resources (DERs), microgrids, and other technological innovations in renewable energy and clean transport industries, and how these developments can contribute to solving longstanding environmental justice issues. As these innovations develop, energy markets will undergo substantial changes to which consumers and industry participants alike will need to adapt and leverage. Every other week, K&L Gates’ The Energizer will highlight emerging issues or stories relating to the use of DERs, energy storage, emerging technologies, hydrogen, and other innovations driving the energy industry forward.

IN THIS ISSUE

  • Department of Energy Announces $3.1 Billion in Matching Grants Toward Development of Domestic Battery Supply Chain
  • ACES Project is Greenlit by U.S. Department of Energy
  • National Laboratory Makes Headway in Long-Term Rechargeable Batteries

2022 Offshore Wind Handbook Now Available

U.S. Offshore Wind Handbook Helps Navigate Technical and Regulatory Issues

We are pleased to announce the release of the 2022 edition of the Offshore Wind Handbook, a collaboration between K&L Gates, Mainstream Renewable Power, and Kent plc., written to help guide investors and new market entrants through technical and regulatory issues in a fast-paced developing U.S. offshore wind market.

To view the 2022 Offshore Wind Handbook, click here.

FERC Moves Forward on Transmission Planning/Cost Allocation Reform

U.S. Energy, Infrastructure, and Resources Alert

By: Ruta K. SkucasKimberly B. FrankJennifer L. Mersing

At its open meeting on 21 April 2022, the Federal Energy Regulatory Commission (FERC) issued a Notice of Proposed Rulemaking (NOPR) in response to its Advance Notice of Proposed Rulemaking: Building for the Future Through Electric Regional Transmission Planning and Cost Allocation and Generator Interconnection (Docket No. RM21-17). Commissioner Mark Christie and Commissioner Willie Phillips entered separate concurrences, while Commissioner James Danly dissented. According to the open meeting, the NOPR proposes to reform, pursuant to Federal Power Act Section 206, FERC’s electric regional transmission planning and cost allocation requirements. If enacted, the NOPR’s reforms would require public utility transmission providers to…

For more information, please contact our Energy, Infrastructure, and Resources lawyers or visit our practice page.

Sustainable Outlook: The Push to Modernize the Grid From Smart Buildings With Courtney Blodgett, Director of Strategy at Edo

By: Molly K. Barker

On this week’s episode of Sustainable Outlook, Molly Barker of K&L Gates interviews Courtney Blodgett of Edo, which is a startup energy venture that works to enable building-to-grid integration and reduce building costs for clients by utilizing clean energy and innovative design solutions. At the intersection of environmental, social, and economic sustainability, Edo’s mission is to transform grid operations and optimize energy consumption for its clients while also addressing climate, affordability, and equity challenges.

Learn more about our participation in the sustainable economy.

BOEM Issues Final Sale Notice for Offshore Wind Lease Areas in Carolina Long Bay

U.S. Energy, Infrastructure, and Resources Alert

By: Stanford D. BairdKenneth J. Gish, JrNathan C. HoweDavid L. WochnerKimberly B. FrankAnkur K. Tohan

The Bureau of Ocean Energy Management will hold its next offshore wind lease auction on 11 May 2022, for two lease areas in the Carolina Long Bay. The lease areas comprise 110,091 acres off the coast of North and South Carolina. The auction date will occur weeks ahead of a 10-year moratorium on offshore energy leases imposed in 2020 by the Trump administration prohibiting auctions of leases for wind, in addition to oil and gas, off the coasts of North and South Carolina beginning on 1 July 2022.

For more information, please contact our Energy, Infrastructure, and Resources lawyers or visit our practice page.

Please Join Us: ESG Insights | SEC Proposed Climate-Related Disclosures

28 March 2022
2:00 – 3:00pm ET
via Webex

ESG perspectives are constantly evolving, and the SEC is releasing several significant ESG-related rules this year.  Companies will have questions about the implications of these rules and what will happen next.  K&L Gates wants to be a resource to its clients and contacts as these rules are released, and public companies consider how to prepare.

On March 21, 2022, the SEC released its proposed rules on climate-related disclosures. We will be hosting a webinar to address initial questions on the rule proposal.  Some of the topics that we will address include: 

  • What disclosures are required by the proposed rules, including board and management oversight and governance of climate-related risks?
  • Is an attestation report required for climate-related disclosures, including Scope 1, 2 and 3 GHG emissions information?  If so, for what information and who can provide an attestation report?
  • Is there a phase-in period in the proposed rules?  If so, when would companies be required to begin providing these climate-related disclosures?
  • What will happen next and what can companies do to prepare?

Panelists:

Please RSVP by March 27. 

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