Category: Uncategorized

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COMMERCE EXTENDS INITIATION DEADLINE IN SOLAR CIRCUMVENTION INQUIRIES & USTR TO START TARGETED CHINA 301 TARIFF EXCLUSION PROCESS
2
Oregon Passes Law to Explore Opportunities for Renewable Hydrogen Development
3
We Have ESG Down to the Letter
4
The Service’s CO-Balancing Act: Final Carbon Capture Credit Regulations Target Broad Taxpayer Implementation and Administrability
5
Join Us for a Webinar: The Promise of Fusion Energy May Be Closer Than You Think
6
FERC Issues Landmark Order No. 2222 To Facilitate the Participation of Distributed Energy Resources in Wholesale Markets
7
The Energizer – Volume 74
8
Join Us at Solar Power International
9
Join Us: PV Magazine Webinar – Is your company capturing the 2020 safe harbor?
10
U.S. ENERGY STORAGE ASSOCIATION RECOGNIZES K&L GATES WITH BRAD ROBERTS OUTSTANDING INDUSTRY ACHIEVEMENT AWARD

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.

At the request of A-SMACC,  Commerce extended the deadline for A-SMACC’s response to the additional questions until October 13. Commerce regulations permit other interested parties to file comments on A-SMACC’s response within seven days.

Commerce has indicated it will make its decision on initiation within 45 days of A-SMACC filing its response to Commerce’s questions. Assuming A-SMACC files on October 13, Commerce’s decision on initiation would be due on or by November 27. If Commerce initiates on November 27, the final results of the full investigation would be due on or by September 23, 2022.

Note that the new Commerce initiation deadline is just past the date the US International Trade Commission is expected to make its decision on the solar safeguard/201 extension (November 24, 2021).

Senate letter. On September 29 (around the time Commerce was initially set to issue its initiation determinations) twelve Senators sent a letter to the Commerce Secretary Raimondo expressing concerns regarding the anonymous petitions alleging illegal trade activity filed with the Department that would have “a devastating impact on the US solar industry and American solar jobs.” The Senators urged Commerce to “carefully assess the validity” of the petitions.

Background. On August 16, US solar manufacturers (the so-called American Solar Manufacturers Against Chinese Circumvention) requested that Commerce launch a circumvention inquiry on imports of solar products produced in Chinese-owned factories in Malaysia, Vietnam and Thailand. If Commerce initiates on November 27, the final results of the full investigation would be due around by September 23, 2022.

A wide range of interested parties have filed comments on A-SMACC’s initial anti-circumvention inquiry request. The parties have raised factual and legal issues related to whether A-SMACC’s inquiry provides sufficient justification for initiation. The parties have also made economic and policy arguments regarding the negative impact if Commerce were to initiate.

In particular, the interested parties argue that initiation of the circumvention inquiry would disrupt solar imports as companies park panels/modules offshore. They also argue that initiation would  undermine the Biden Administration’s push for expansion of US solar installation and capacity. In addition, nearly 200 companies involved in the solar industry, along with solar industry groups, have warned that imposition of tariffs on imported panels/modules from Malaysia, Vietnam and Thailand would devastate the industry and threaten US jobs.

The circumvention action is tied to the AD/CVD orders on Chinese CSPV cells. The petitioners in the circumvention case are arguing that imports of solar panels/modules produced in Chinese-owned factories in Malaysia, Vietnam and Thailand, with Chinese wafers and other Chinese components, should be subject to current antidumping and countervailing duty orders on Chinese cells/modules.

Commerce (or CBP) could act to make the circumvention findings retroactive, which means there is the potential that importers could be on the hook for payment of additional duties on previous imports.

USTR TO START TARGETED CHINA 301 TARIFF EXCLUSION PROCESS

On October 8, USTR published notice that it will consider requests to reinstate previously-granted China 301 tariff exclusions. The catch is: (1) only previously-granted exclusions that were subsequently extended through the end of 2020 are up for consideration; and (2) the reinstated exclusions would only apply to merchandise entered into the US on or after October 12, 2021 (the date USTR opens the public docket for filing reinstatement requests).

USTR intends to evaluate the possible reinstatement of each exclusion on a case-by-case basis. The public docket opens on October 12, 2021. The deadline for filing comments is December 1, 2021. Parties seeking to comment on more than one exclusion must submit a separate comment for each exclusion.

USTR has provided a list of the 549 previously-extended product exclusions up for consideration, on its website.[1] In addition, comments need to be filed using the form provided by USTR on its website.[2] The form contains specific requests for information regarding the company, many of which will look familiar from the original exclusion and exclusion extension process.   

A key factor in USTR’s evaluation will be whether the particular product remains available only from China. USTR is requesting that commenters address the following issues—

  • Whether the particular product and/or a comparable product is available from sources in the United States and/or in third countries.
  • Any changes in the global supply chain since September 2018 with respect to the particular product or any other relevant industry developments.
  • The efforts, if any, the importers or US purchasers have undertaken since September 2018 to source the product from the United States or third countries.
  • Domestic capacity for producing the product in the United States.

In addition, USTR will consider—

  • Whether or not reinstating the exclusion will impact or result in severe economic harm to the commenter or other US interests, including the impact on small businesses, employment,  manufacturing output, and critical supply chains in the United States, and
  • The overall impact of the exclusions on the goal of obtaining the elimination of China’s acts, policies, and practices covered in the section 301 investigation.

Exclusion track record. From 2018 to 2020, US stakeholders submitted about 53,000 exclusion requests to USTR for specific products covered by the section 301 China tariffs. A US Government Accountability Office report found that the agency denied 46,000 of those requests (87 percent) while approving about 2,200. Of the approvals, just 549 saw their tariff breaks extended – and it is these 549 previously-extended product exclusions that are up for consideration and possible reinstatement.


[1] https://ustr.gov/sites/default/files/files/Notices/Section 301 China Request for Comments/Annex of Previously Extended Exclusions for Website.pdf.

[2] https://ustr.gov/sites/default/files/files/Notices/Section 301 China Request for Comments/Facsimile of Data Requested.pdf.

Oregon Passes Law to Explore Opportunities for Renewable Hydrogen Development

By: Gabrielle E. Thompson and William H. Holmes

On 19 May 2021, Governor Kate Brown signed Senate Bill 333 into law, which directs the Oregon Department of Energy to study the potential for development of renewable hydrogen production and use in Oregon. The results of the study are due to the Legislature by 15 September 2022.

Under the new law, the study will evaluate the benefits, as well as any barriers, to the production and use of renewable hydrogen in Oregon. The study will utilize existing data, studies, or other publicly available materials to analyze how “renewable hydrogen may support existing renewable energy and greenhouse gas reduction policies and goals in Oregon.”1

Specifically, the study will identify the total hydrogen volume currently used each year in Oregon by various industries and the potential applications of renewable hydrogen in Oregon by 2030 by sectors such as transportation, industry, electricity generation, and energy storage. The study will also include an assessment of the potential for using renewable hydrogen in conjunction with other renewable electricity generation to increase resiliency or to provide flexible loads.

Additionally, the study will look at the forecasted costs of renewable hydrogen and how those costs may affect its adoption in Oregon. Finally, the study will consider and identify any technological, policy, commercial, or economic barriers to the adoption of renewable hydrogen in Oregon.

The study represents an important first step in determining the opportunities for developing renewable hydrogen production and development in Oregon, which has adopted a Renewable Portfolio Standard that requires 50 percent of the electricity Oregonians use come from renewable sources by 2040. Renewable hydrogen is another potential source that could be used to meet those renewable energy requirements.

The bill, which was sponsored in the Senate by Senator Lee Beyer (D – Springfield), received a unanimous vote in favor by the House Energy and Environment Committee and received bipartisan support from Representative Helm (D – Washington County) and Representative Brock-Smith (R – Port Orford), who carried the bill to the House floor where it passed unanimously.

The bill was drafted by Renewable Hydrogen Alliance (RHA), a trade association based in Portland, Oregon, with more than 70 members in the United States and worldwide dedicated to the mission of using renewable electricity to create clean fuels.


1Senate Bill (SB) 333 Enrolled (2021).

We Have ESG Down to the Letter

Our integrated environmental, social, and corporate governance (ESG) approach is designed to help our clients navigate ever-evolving standards and add value to their companies. We’ve structured our broad scope of ESG services within coordinated and collaborative areas of focus, including corporate governance, investing, energy, and agriculture. These global teams span regions and industries to address an array of issues, from legislative, regulatory, and policy matters, to fund launches and environmentally responsible corporate initiatives.

We can evaluate and advise your business from E to S to G.

For more on our ESG practice, please click here.

The Service’s CO-Balancing Act: Final Carbon Capture Credit Regulations Target Broad Taxpayer Implementation and Administrability

By: Elizabeth C. CrouseAaron C. Meyer, and Mary Burke Baker

Amid the headline-grabbing events of 6 January 2021, the U.S. Department of Treasury released final regulations under Code Section 45Q. Code Section 45Q provides for a U.S. federal income tax credit at varying rates to taxpayers that participate in various aspects of the process of sequestering carbon oxide and disposing of it in secure geologic storage, use it as a tertiary injectant in a qualified enhanced oil or natural gas recovery project, or utilize it in certain processes. 

Join Us for a Webinar: The Promise of Fusion Energy May Be Closer Than You Think

Join us on 1 October 2020 for a webinar on fusion energy.

For nearly 100 years, scientists and engineers, as well as science fiction authors and fans, have dreamt of harnessing fusion reactions to power our economy. Despite daunting technical challenges, fusion energy may become a technically viable and economic energy source in the coming years, as an attractive carbon-free baseload alternative to conventional energy sources.

As the energy sector progresses towards commercial fusion, governmental regulators around the world are considering how they should treat fusion facilities. Two of the most active jurisdictions for commercial fusion development are the United States and the United Kingdom. Along with Fire Energy and Prospect Law, members of our K&L Gates fusion energy team will provide an update on the regulatory approaches to fusion that the US and UK are taking, the prospects for differentiating regulations for future fusion facilities from those applicable to existing fission-powered nuclear plants, next steps in developing regulatory certainty for the emerging fusion power sectors in these nations, and include a section on risk and the management of risk through insurance.

For more information and to register, please click here.

FERC Issues Landmark Order No. 2222 To Facilitate the Participation of Distributed Energy Resources in Wholesale Markets

Authors: Buck Endemann, Kimberly Frank, Elias Hinckley, and Patrick Metz

In a landmark order issued on September 17, 2020, the Federal Energy Regulatory Commission (FERC) adopted rules aimed at removing barriers to the participation of distributed energy resources (DERs) in the organized markets for electric energy, capacity, and ancillary services operated by Regional Transmission Organizations and Independent System Operators (RTOs).  Order No. 2222 builds on reforms previously undertaken by FERC and, once fully implemented, should be a major step toward opening up RTO markets to competition, facilitating new entry of resources, and fostering business model innovation.

Order No. 2222 envisions “aggregations,” which are groups of small DERs participating in the RTO markets as a single resource represented by their aggregators.  According to FERC, these aggregations will permit DERs to provide a variety of products and services that will compete with more conventional resources in the RTO markets.  FERC expects that this will, in turn, ensure that rates remain just and reasonable.

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The Energizer – Volume 74

By: Buck B. EndemannDaniel S. CohenMolly K. BarkerOlivia B. MoraAbraham F. JohnsNatalie J. ReidMatthew P. Clark

A biweekly update on clean technology applications, distributed energy resources, and other innovative technologies in the renewable energy and clean transport sector.

There is a lot of buzz around cleantech, distributed energy resources (“DERs”), microgrids, and other technological innovations in the renewable energy and clean transport industries. As these innovations develop, energy markets will undergo substantial changes to which consumer 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 and clean transportation industries forward.

IN THIS ISSUE:

  • Southern California Edison Invests in EV Charging
  • The University of Newcastle Develops Thermal Block Energy Storage System
  • Researchers in Sweden Develop Molecule that Stores Sunlight as Chemical Bonds
  • Massachusetts Supreme Court Upholds PPA Backing a US$1 Billion Transmission Line to Carry Canadian Hydro-Electric Power to Bay State

Join Us at Solar Power International

Please join K&L Gates Energy, Infrastructure and Resources Practice Area Leader, David Benson, at Solar Power International as he moderates the panel, “The Evolution of Finance in a Changing Offtake Market,” on Friday, September 25, 2020, at 3:05pm EDT.

This panel will discuss new revenue models, such as merchant projects, hedging strategies, and VPPAs, are changing how renewable energy projects are being financed. Topics will include how panelists view projects with these evolving offtake approaches and how they view risk in these markets, taking the audience through transaction structures and what it takes to execute renewable energy deals.

For more information on Solar Power International, please click here.

Join Us: PV Magazine Webinar – Is your company capturing the 2020 safe harbor?

Join K&L Gates partner, Elias Hinckley, as he participates on a webinar with PV Magazine, “Is Your Company Capturing the 2020 Safe Harbor?”

­This webinar will discuss the current 26% solar investment tax credit that will be reduced by to 22% on January 1, 2021 and steps to take to ensure your project captures the full credit.

The webinar will take place on Wednesday, 23 September, 2020, at 11:00 AM EDT.

For more information and to register, please click here.

U.S. ENERGY STORAGE ASSOCIATION RECOGNIZES K&L GATES WITH BRAD ROBERTS OUTSTANDING INDUSTRY ACHIEVEMENT AWARD

The U.S. Energy Storage Association (ESA), the national trade association for the American energy storage industry, will recognize K&L Gates with the Brad Roberts Outstanding Industry Achievement Award at the 2020 ESA Annual Awards taking place during the association’s virtual conference next week.

The award recognizes K&L Gates for “its tremendous contributions that have advanced the industry forward including nurturing early storage developers, hosting an annual conference, and developing the widely circulated Energy Storage Handbook.” The ESA determines this award by surveying its members and past award recipients each year to identify a member organization that has made significant contributions in the storage industry.  

Read more about the award in the ESA press release

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