Author: Lily Dickinson

1
Reactive Power Compensation for Renewable Energy Facilities: Opportunity Amidst Change
2
Update on the Tax Credit Revolution: Prevailing Wage and Apprenticeship Clock Starts Soon
3
FERC Enforcement In 2021: A Year Of Change
4
Commerce Extends Initiation Deadline in Solar Circumvention Inquiries & USTR to Start Targeted China 301 Tariff Exclusion Process

Reactive Power Compensation for Renewable Energy Facilities: Opportunity Amidst Change

By: Ruta Skučas, Maria Faconti, Kimberly Frank

Originally published in the Oil, Gas & Energy Resources Law Section Report – Volume 47, Number 1 / January 2023.

Reactive power provides synchronous and non-synchronous generators, as well as other forms of non-generation resources capable of providing reactive power, with a potential additional revenue stream. The provision of voltage support to the grid is an ancillary service, compensated in various ways in the various wholesale electricity markets. Renewable developers should familiarize themselves with the opportunities provided by reactive power compensation, even as some of the compensation models may be shifting.

In 2016, the Federal Energy Regulatory Commission (“FERC”) began allowing wind and solar facilities to offer reactive power as an ancillary service into wholesale electricity markets. Over the past few years, FERC and the independent system operators (“ISOs”) and regional transmission organizations (“RTOs”) began to revisit reactive power compensation models and, as a result, there has been a greater focus on reactive power issues in 2022. This article reviews the current status of reactive power compensation in various U.S. regions, as well as possible future changes.

Update on the Tax Credit Revolution: Prevailing Wage and Apprenticeship Clock Starts Soon

U.S. Energy, Infrastructure, and Resources Alert

By: Elizabeth C. CrouseCraig E. Leen

The U.S. Treasury Department released a preliminary draft of Notice 2022-61 (the Notice) on 29 November 2022 and the final on 30 November 2022. Taxpayers now have 59 days to begin construction on qualified projects without causing those projects to be subject to the new prevailing wage and apprenticeship requirements. The U.S. Department of Labor also released companion FAQs on the prevailing wage and apprenticeship rules 29 November 2022. The Notice generally applies to credits under Code[1] Sections 30C (alternative fuel infrastructure), 45Y (post-2024 electricity PTC[2]), 48E (post-2024 electricity ITC[3]), 45V (hydrogen PTC), 45 (current electricity PTC), 48 (current electricity ITC), 45Q (carbon capture), 45L (energy efficient homes), 45U (zero-emission nuclear power), 48C (advanced energy manufacturing facilities), and 179D (energy efficient commercial buildings), but the beginning of construction rules apply more narrowly.

For further details, please see the following Alert that discusses some of the main points in the Treasury and Labor guidance that was released.

FERC Enforcement In 2021: A Year Of Change

By:  Ruta Skučas, Kimberly Frank, and Maeve Tibbetts

Originally posted on Law360 on January 3, 2022

2021 was a pivotal year for the Federal Energy Regulatory Commission‘s Office of Enforcement. Under the direction of Chairman Richard Glick, the office gained a new director, Janel Burdick, added threats to infrastructure as a new priority, and increased its pace of opening and closing investigations and reaching settlements.

Most significantly, Glick asserted at the presentation of the 2021 enforcement report that “the cop is back on the street,” and that he intends to ensure “vigorous oversight and enforcement” of jurisdictional markets.

Increased Investigations Under Chairman Glick

During the commission’s November 2020 open meeting, when the Office of Enforcement presented its 2020 annual report, then-Commissioner Glick criticized the commission’s enforcement efforts, which he perceived as lacking. In 2020, the commission opened only six new investigations, and reached three settlements totaling $553,376.

Commerce Extends Initiation Deadline in Solar Circumvention Inquiries & USTR to Start Targeted China 301 Tariff Exclusion Process

By: Stacy J. Ettinger

COMMERCE EXTENDS INITIATION DEADLINE IN SOLAR CIRCUMVENTION INQUIRIES – NEW DEADLINE LATE NOV

On September 29, 2021, Commerce determined to delay a decision on initiation in the solar circumvention inquiries. Commerce instead asked the US solar manufacturers – A-SMACC (the so-called American Solar Manufacturers Against Chinese Circumvention) – for additional information. In particular, Commerce requested additional information related to why the A-SMACC companies have requested anonymity in the circumvention proceeding. Commerce also requested information regarding the A-SMACC companies’ ties to business interests in China or Southeast Asian countries.

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