Regulation and Legislation – Page 8 – Global Power Law & Policy

Oregon Moves Ahead on Energy Storage

May 26 2015

The Oregon Department of Energy (ODOE) recently announced that in June 2015 it will issue a request for proposals (RFP) for an electrical energy storage demonstration project. The U.S. Department of Energy will make $250,000 in federal funding available for the selected project, and ODOE and Oregon BEST will supply an additional $45,000. The RFP is intended to incent 500 kW or larger storage projects that “improve electric transmission and/or distribution system operations, service quality, and reliability.” The RFP will be technology neutral, and ODOE hopes to receive bids from “utilities, energy storage technology vendors, energy service suppliers and electric utility customers.” Applicants will need to have either a “committed utility partner” or a letter of support from the utility with which the project will interconnect—potential bidders may want to begin laying the groundwork for those arrangements pending the RFP’s issuance. The recipient of the award will be expected to provide a minimum 50% cost share and will need to “start” the project in 2015. (ODOE’s press release does not explain what will be required to “start,” and presumably the RFP will address that question.)

ODOE’s press release can be found here. The RFP announcement will appear on ODOE’s energy storage web site in June.

This announcement comes hard on the heels of news that the Oregon Senate Business and Transportation Committee passed H.B. 2193 out to the full Senate following a hearing on May 20. The proposed legislation would direct electric companies, if authorized by Oregon’s Public Utility Commission, to procure certain energy storage systems. The bill passed the Oregon House by a vote of 58-2. We’ll report on the final version of the bill if it is enacted, which seems likely—in the meantime, a summary of an earlier version of the legislation can be found here.

North Carolina General Assembly Active on Renewable Energy Issues in 2015 Long Session

May 13 2015

Two bills with significant renewable energy provisions were among those that survived the North Carolina General Assembly’s self-imposed “crossover” deadline of April 30, 2015. Most substantive bills must pass at least one house of the legislature before the crossover deadline in order to remain eligible for consideration in the 2015-16 legislative biennium. However, some bills and portions of bills that do not make crossover can still be included in the budget or as amendments to bills that did beat the deadline.

The two energy bills that made it through crossover provide for (i) a very limited extension of North Carolina’s renewable energy tax credit, and (ii) a reduction of the only mandatory renewable energy portfolio standard in the southeast. The bill providing for a limited extension of the state renewable energy tax credit was signed into law by Governor Pat McCrory and went into effect immediately. The portfolio standard reduction has passed the House and is being debated in the Senate as of this writing. Both bills are described in this alert.

To read the full alert, click here.

FERC Issues Rule to Reduce Regulatory Burdens for Generators That Own Generator Tie-Lines

Apr 30 2015

I. Introduction

Last month, the Federal Energy Regulatory Commission (“FERC”) issued its final rule on Open Access and Priority Rights on Interconnection Customer’s Interconnection Facilities (“Order No. 807” or “Final Rule”)[1]. Order No. 807 is intended to reduce the regulatory burdens for generators that own generation tie-lines (referred to in the Final Rule as “Interconnection Customer’s Interconnection Facilities” or “ICIF”)[2], and to promote the development of generation resources. The Final Rule makes three significant changes to the treatment of ICIF under FERC’s regulations. First, it establishes a blanket waiver of the Open Access Transmission Tariff (“OATT”), Open Access Same-Time Information System (“OASIS”) and the Standards of Conduct requirements for all ICIF owners who in the past were subject to such requirements solely as a result of their ownership of ICIF. Second, the Final Rule requires that all third-party requests for service on ICIF eligible for the blanket waiver be made pursuant to Sections 210, 211 and 212 of the Federal Power Act (“FPA”). Finally, the Final Rule establishes a five-year safe harbor period during which ICIF owners who are eligible for the blanket waiver will benefit from a rebuttable presumption that they or their affiliates have definitive plans to use any excess capacity available on the ICIF.

Powers of Regulators Brought Into the Spotlight by High Court Decision

Apr 14 2015

Recently the High Court of Australia handed down its unanimous decision in Australian Communications and Media Authority v Today FM (Sydney) Pty Ltd [2015] HCA 7 (HCA Decision) which relates to the powers of the Australian Communications and Media Authority (Authority).

The HCA Decision accepts that the Authority was permitted to make a finding of fact that a licensee committed a criminal offence and in doing so had breached a licence condition, despite the fact that no proceedings in relation to the criminal offence had been commenced or successfully prosecuted.

Security of Payment Legislation and Set-Off Under Commonwealth Insolvency Laws

Apr 14 2015

A recent Victorian Supreme Court case[1] has clarified the impact of Commonwealth insolvency set-off provisions on State-based security of payments legislation.

The case demonstrates that although a principal is generally precluded from relying on a set-off or counterclaim in certain contexts under the Building and Construction Industry Security of Payment Act 2002 (Vic) (BCISP Act), this general preclusion does not apply if the claimant is in liquidation, due to the operation of section 553C of the Corporations Act 2001 (Cth) (Corporations Act).

The case also provides useful commentary on what is considered a ‘payment schedule’ for the purposes of the BCISP Act.

If you would like to read more about this case, please click here.

[1] Façade Treatment Engineering Limited v Brookfield Multiplex Construction Pty Ltd [2015] VSC 41.

The Australian Energy Market Commission releases a draft report recommending against the implementation of optional firm access

Mar 18 2015

On 12 March 2015 the Australian Energy Market Commission (AEMC) released its draft report about a model for optional firm access to electricity transmission networks.

The report follows the development, testing and assessment of the optional firm access model by the AEMC at the request of the Council of Australian Governments’ Energy Council.

Amendments to the Australian Corporations Regulations: carbon abatement contracts not financial products

Mar 17 2015

The Emissions Reduction Fund (ERF) forms a key part of the Australian Federal Government’s Direct Action Plan to address climate change. Under the model, successful bidders in an ERF auction enter into “carbon abatement contracts” with the Clean Energy Regulator. These contracts require the bidder to provide carbon abatement to the Regulator according to an agreed schedule.

Previously, carbon abatement contracts may have been considered “derivatives” and “financial products” for the purposes of the Corporations Act 2001 (Cth) (the Act) and Corporations Regulations 2001 (Cth) (Regulations). This characterisation would have subjected ERF participants to onerous regulatory burdens under the Act and Regulations (such as the requirement to hold an Australian Financial Services Licence).

To ensure that persons are not burdened by these regulatory obligations simply because they regularly enter into contracts with the Clean Energy Regulator, the Corporations Amendment (Emissions Reduction Fund Participants) Regulation 2015 (the Amendments) exempt carbon abatement contracts from the definitions of “derivative” and “financial product”.

The Amendments will commence the day after they are registered on the Australian Federal Register of Legislative Instruments.

Oregon Considers Energy Storage Legislation

Mar 13 2015

The Oregon legislature is considering a bill that would require the state’s large electric utilities to procure one or more “qualifying energy storage systems” by January 1, 2020. H.B. 2193 would apply to any entity that is engaged in the business of distributing electricity to retail electricity consumers in Oregon (not including a consumer-owned utility) if the entity makes sales of electricity to retail customers in an amount that equals 3 percent or more of all electricity sold to retail electricity customers in Oregon. An energy storage system is deemed to be “qualifying” if it is “cost-effective,” and the legislation contemplates that each electric company would procure one or more such systems having the capacity to store not less than 5 megawatts of electricity but not more than an amount of electricity that is equal to one percent of the company’s peak load for 2014. H.B. 2193 would allow an electric company to recover in its rates all costs prudently incurred in procuring one or more cost-effective energy storage systems, “including any above-market costs associated with procurement.”

Regulatory implications of new products and services in the Australian electricity market

Mar 03 2015

The Energy Market Reform Working Group in Australia released a consultation paper at the end of 2014 regarding the regulatory implications of new products and services in the national electricity market.

New products and services include energy supply from generation facilities installed at the customer’s premises (which may be combined with energy storage), products and services relating to demand management and energy information and advice.

The paper outlines some of the potential regulatory implications of these new products and services. It seeks feedback from stakeholders as to the types of new products and services which may be offered to small customers and whether regulatory reforms may be necessary – from either a consumer protection or a power system operations perspective.

Stakeholders are invited to make submissions on the issues raised by the consultation paper by close of business on 20 March 2015. Written submissions can be sent by email to energycouncil@industry.gov.au. Alternatively, please contact us and we would be happy to assist you in preparing a submission.

To read more about this consultation paper and the key findings and issues identified, please click here.

Australian Government Announces First Emissions Reduction Fund Auction

Feb 19 2015

The Australian Government recently announced that the first Emissions Reduction Fund auction will occur in April 2015. The Emissions Reduction Fund provides proponents of carbon abatement projects with opportunities to enter into contracts with the Government, via the Clean Energy Regulator, under which the proponent receives payment for undertaking carbon abatement. In the reverse auction process project proponents will submit sealed bids for the Clean Energy Regulator to purchase (in the form of Australian carbon credit units) emissions reductions generated by their projects.

Successful auction bids will be those with the lowest price, and successful proponents will then enter into Australian Carbon Contracts with the Clean Energy Regulator. The first auction will be open from 9.00am (Australian Eastern Standard Time) on 15 April 2015 and close at 5.00pm on 16 April 2015 (Australian Eastern Standard Time). The auction will occur through the online bidding platform Austender.
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Catagory:Regulation and Legislation