Tag:Power

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FERC Approves Enforcement’s Settlements With Two Demand Response Providers
2
Financing the Renewable Hydrogen Revolution
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Update on the Tax Credit Revolution: Prevailing Wage and Apprenticeship Clock Starts Soon
4
Declaration Of Emergency And Authorization For Temporary Extensions Of Time And Duty-Free Importation Of Solar Cells And Modules From SE Asia
5
Five Agencies Issue Ambitious Renewable Energy Goals for Federal Lands: 25GW by 2025
6
FERC Enforcement In 2021: A Year Of Change
7
The Service’s CO-Balancing Act: Final Carbon Capture Credit Regulations Target Broad Taxpayer Implementation and Administrability
8
Eye on the Election: Potential Impact on Tax Incentives for Power and Related Industries
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The Energizer – Volume 70
10
The Energizer – Volume 69

FERC Approves Enforcement’s Settlements With Two Demand Response Providers

By: Kimberly B. FrankRuta K. SkucasMaria C. Faconti, and Theodore L. Kornobis

On 22 May 2023, the Federal Energy Regulatory Commission (FERC) issued two orders approving stipulation and consent agreements that resolve enforcement investigations by FERC’s Office of Enforcement (FERC Enforcement) of two demand response providers, Leapfrog Power, Inc. (Leapfrog) and OhmConnect, Inc. (OhmConnect), regarding their participation in the California Independent System Operator (CAISO) market.1 FERC Enforcement’s focus in both cases concerned whether the companies violated a provision of the CAISO tariff requiring market participants to have a reasonable expectation that they could fulfill the bids they submitted. 

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Financing the Renewable Hydrogen Revolution

A Supplement to The H2 Handbook, United States

Risk in the hydrogen industry spans multiple areas, from feedstock and power supply to offtake and transportation. Understanding the regulatory, tax, and practical considerations of hydrogen projects, particularly green hydrogen, is essential for formulating an investment strategy for renewable hydrogen.

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

U.S. Energy, Infrastructure, and Resources Alert

By: Elizabeth C. Crouse, and Craig E. Leen

The US 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.

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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

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

Five Agencies Issue Ambitious Renewable Energy Goals for Federal Lands: 25GW by 2025

By: Elizabeth C. Crouse and David Wang

Five federal agencies (the Departments of Agriculture (USDA), Defense (DoD), Energy (DOE), and Interior (DOI), and the Environmental Protection Agency (EPA)) have announced in a Memorandum of Understanding (MOU) that they will “prioritize and expedite” the development of at least 25GW of renewable energy on federal lands administered by DOI and USDA by 2025. The MOU contemplates continued cooperation in respect of renewable energy development on additional federal lands between 2025 and 2030. This initiative, which is pursuant to directives set forth by the Energy Act of 2020, aims to improve interagency cooperation for the expedited processing of wind, solar, and geothermal energy applications. This includes the development of supporting activities, such as electric transmission, access routes, energy storage, and land use planning. The Bureau of Land Management (BLM) and U.S. Forest Service (USFS), in coordination with the National and BLM Renewable Energy Coordination Offices (RECOs), will be the lead agencies overseeing the interagency coordination and expedited reviews for the respective lands they administer.

In addition to increasing coordination of environmental and other agency reviews, the five agencies aim to improve interagency collaboration in the National and BLM RECOs, identify opportunities for coordination with state and Tribal governments, and streamline the project approval process by eliminating redundancies and accelerating decision-making. The MOU notes that, in the course of conducting the reviews, consideration will be given to “the protection for cultural resources and sacred sites as well as the Nation’s land, water, and biodiversity, and fostering creation of jobs to support local communities.” The federal government’s ambitious prioritization of the development of renewable energy generation facilities and key ancillary activities such as transmission presents tremendous opportunities for developers and investors. Moreover, the focus on DOI lands indicates strong support for Tribes and echoes the Biden administration’s support for economic development and energy justice. However, working with the federal government can be complicated, even during an administration that clearly means business when it comes to climate change and the energy transition. Our Public Policy, Government Contracting, Indian Law, and Power teams stand by to help you navigate the challenges and seize the opportunities.

To learn more about K&L Gates’ Public Policy, Government Contracting, American Indian Law, and Power practice areas, please visit our website.

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.

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. 

Eye on the Election: Potential Impact on Tax Incentives for Power and Related Industries

Authors: Elizabeth C. Crouse, Mary Burke Baker, Jared D. Mobley, Joel D. Almquist, and Lauren M. Flynn

There is little doubt that the outcome of the 3 November federal election will be consequential for much of America, and that the consequences are likely to be very different depending on who sits in the Oval Office and the Senate after the inauguration. Of all the industries that employ Americans, the power and related industries such as oil and gas, carbon capture, and electric vehicles may experience the starkest consequences.

CLICK HERE to read the full alert.

The Energizer – Volume 70

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:

  • British Government Announces New Investments in Small Nuclear Reactor Projects
  • States Pledge to Reduce Emissions from Medium- and Heavy-Duty Vehicles
  • Portland General Electric Company Launches Pilot Virtual Power Plant Program
  • Federal Appeals Court Upholds FERC Order to Open Wholesale Market to Storage
  • Power Ledger Releases RENeW Nexus Report Discussing its Residential Energy Trading Pilot in Western Australia

The Energizer – Volume 69

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:

  • Two Major Florida Utilities Begin to Transition Away from Coal
  • Pilot Program for Central American REC Market Completes First Stage
  • New California Regulations Transition Short-Haul Trucks to Zero-Emission Standards
  • Two More Major Western Utilities Commit to Close Coal-Fired Power Plants

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