Global Power Law & Policy – Page 43 – Legal and policy developments affecting the global power industry.

Oregon Enacts Energy Storage Legislation

Jun 25 2015

On June 1, 2015, the Oregon legislature passed House Bill 2193-B, which requires certain electric companies to procure qualifying energy storage systems by January 1, 2020, subject to authorization by the Oregon Public Utility Commission (the “Commission”). An electric company may recover in rates all costs prudently incurred in the procurement of the energy storage system(s), including any above-market costs associated with procurement. The final version of the bill enjoyed broad support, passing the Oregon Senate by a vote of 17-12 and the House by a vote of 56-3. Governor Kate Brown signed the bill into law on June 10.

To read the full alert, click here.

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.

Australian Renewable Energy Target (RET) – Revised RET deal finalised

May 18 2015

A bipartisan agreement on the revised Renewable Energy Target (RET) was finally reached between the Australian Government (represented by Industry Minister, Ian Macfarlane and Environment Minister, Greg Hunt) and the Opposition (represented by Mark Butler and Gary Gray) on the morning of 18 May 2015 in Melbourne. There have been reports that the agreement was reached with intervention from the Prime Minister Tony Abbott’s office.

As contemplated by the in principle agreement reached between the Government and the Opposition on 8 May 2015, the existing target of 41,000 GWh of large scale renewable energy by 2020 will now be reduced to 33,000 GWh. This reduction will be effected by way of legislative amendment to the Renewable Energy (Electricity) Act 2000 (Cth).
Australia is the first developed country to formally reduce its renewable energy target. There are suggestions the reduced RET will cause investment in Australian renewable energy projects to fall from an expected AUD20.6 billion by 2020 to AUD14.7 billion.

The Government has agreed not to pursue its proposal to continue reviewing the target every two years. This alleviates concerns over the retention of the two-yearly reviews of the scheme. These reviews have arguably been the predominant cause of the current investment freeze in the renewable energy industry. In lieu of the two-yearly reviews, annual statements detailing achievement towards meeting the RET and impacts on electricity prices will be provided by the Clean Energy Regulator.

Despite lack of support from the Opposition, the Greens and the renewable energy industry, the Government’s plan to include native forest wood waste in the range of energy sources that are eligible to contribute to the RET will be included in the relevant amending legislation which is expected to be presented to Parliament next week. The Government intends to pass this proposal with support from the Senate crossbench.

It is expected the revised RET should be passed by both the House of Representatives and the Senate before the winter recess on 25 June 2015.

The Opposition has indicated that it would increase the 2020 target if it wins the next election, which is to be held on or before 14 January 2017.

Funding for Washington’s Clean Energy Fund II Hangs in the Balance

May 14 2015

Funding for Washington’s Clean Energy Fund (“CEF”) II hangs in the balance as the Washington State Legislature entered the 15th day of its first special session following the close of the 2015 regular session. A special session was necessary because neither a general fund budget nor a capital budget has been passed.

The CEF, which was established for the first time in the 2013 capital budget, is managed by the state Department of Commerce and supports clean energy projects and technologies statewide. Governor Inslee proposed $60 million for CEF II in his 2015 capital budget. The House has $40 million for CEF in the House’s 2015 proposed capital budget, and the Senate has $0.

Budget leaders in Olympia are meeting to develop compromise general fund and capital budgets, and the future of CEF II must be resolved in those negotiations.

The 2013 CEF was used to fund energy storage demonstration projects proposed by Avista Utilities, Puget Sound Energy, and Public Utility District No. 1 of Snohomish County, Washington ($15 million). The 2013 CEF funds also were used for revolving loan fund grants to support residential and commercial energy efficiency projects ($15 million). The remainder of the 2013 CEF ($6 million) will be used by Washington research institutions as matching funds for federal grants.

For more information, click here visit the CleanTech Alliance website.

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.

Australian Renewable Energy Target (RET) – in principle agreement reached on a revised RET

May 10 2015

After months of negotiations, Industry Minister Ian Macfarlane has confirmed that on 8 May 2015 the Australian Government and the Opposition have agreed in principle a revised Renewable Energy Target (RET) of 33,000 gigawatt-hours (GWh) of large scale renewable energy by 2020. Read More

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.

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Apr 10 2015

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