Congress Passes Extension and Modification of Production Tax Credit

News reports have already alerted people to the fact that Congress has extended the Production Tax Credit ("PTC") for wind as part of its agreement to avoid the fiscal cliff. The bill - named the American Tax Relief Act of 2012 - extended the sunset date for wind through December 31, 2013. This extension gives wind parity with all other renewable resources covered by the PTC.

What hasn't been as widely reported, however, is that Congress also made a significant modification to the PTC as part of the same provision.

Previously, whether a facility qualified for the PTC depended on when the facility was placed in service for federal income tax purposes. That provision has now been changed so that a facility will qualify for the PTC if construction with respect to the facility begins on or before January 1, 2014. This change applies to all renewables (biomass, marine and hydrokinetic, landfill gas, trash, hydropower) to which the PTC applies (not just wind), with the exception of refined coal and Indian coal. In other words, there is no longer a placed in service deadline for purposes of the PTC if construction begins before January 1, 2014.

For those of you acquainted with the 1603 grant, this "begun construction" requirement will seem very familiar. However, caution is required. First, the 1603 grant was administered by Treasury Department whereas the PTC will be administered by the IRS. The Treasury Department was generally viewed as favorably disposed to 1603 applicants. Second, we do not yet know how the IRS will interpret the term "begun construction." There is no requirement that the IRS interpret it consistently with section 1603. We do know, however, that the IRS included a 10% safe harbor as part of the bonus depreciation regulations (Treas. Reg. 1.168(k)-1(b)(4)(iii)(B)(2)), so it is possible that they may provide a safe harbor for the PTC as well.

It is also important to note that, along with extension and modification of the PTC, the legislation extended for one year the ability of taxpayers to elect the ITC in lieu of the PTC.

The modification of the PTC will likely make 2013 an interesting year, particularly as developers attempt to meet the "begun construction" requirements (however that term is eventually defined). If the IRS gives developers a safe harbor of some sort, it will be essential that they avoid the last minute, year-end rush we experienced in 2011 as we worked to qualify projects (mostly solar) for the “begun construction” requirements of the 1603 grant. A key gating item may well be the extent to which utilities seek to procure wind and other renewable energy is Qs1-2, 2013.

We will keep you apprised of further developments and insights.

In the meantime, should you have any questions, please contact Kevin Pearson, Adam Kobos, Carl Lewis, Greg Jenner or any other Stoel Rives attorney.

TerraPass Issues California Renewable Energy RFI

TerraPass Inc., recently issued a Request for Information (RFI) on behalf of a client that is interested in ownership, investment and/or long-term bundled renewable energy offtake opportunities within PG&E territory.  The RFI seeks information from firms with renewable energy projects that are currently under development or construction in California and have projected online dates in 2014 or 2015. TerraPass' client will consider a project or portfolio of projects with expected generating capacity of up to 230 million kilowatt-hours per year.  

TerraPass' contact for this RFI is Erin Craig, who can be reached at 415-644-578.  We understand that the deadline for the RFI response is October 26.

Army Holds Pre-Proposal Conference in Huntsville on Renewable Energy Procurement

On August 22, 2012, the U.S. Army Engineering & Support Center in Huntsville, AL held a pre-proposal conference to discuss the final multi-award task order contract that was issued on August 7, 2012 (the “Final RFP” or “MATOC”).  My colleague, Lane Tucker, and I attended to hear the Army’s presentations and to engage directly with renewable energy developers, consultants, seasoned government contractors, large energy service contractors (ESCOs), and others. The conference provided attendees a great opportunity to explore the field of potential contractors and subcontractors and start (or continue) conversations about potential teaming arrangements that could result in both a MATOC award and one or more base task order awards. 

For those who could not attend, fear not; all of the presentation materials will soon be available on the Army EITF website and the Huntsville team will post all of the questions presented, along with the Army’s formal responses, to the ProjNet website. Also important is that Tonju Butler, the Procuring Contracting Officer, indicated that the deadline for questions on the Final RFP would be extended from today until September 7, 2012, so that individuals and teams can have additional time to formulate and posit questions that may be important to their proposals.  However, that change has not yet been posted to the FedBizOpps website as an amendment.  It is too early to tell whether this extension foreshadows an extension of the October 5, 2012 proposal deadline. Right now, the Army is holding firm to that date, so individuals and teams that intend to respond should plan accordingly. Keep an eye out for other amendments to the Final RFP, too. Conference attendees were assured that more would be forthcoming to clarify small technical issues and, hopefully, to flush out the structure for proposing prices. All amendments will be posted to the FedBizOpps website for the MATOC.

Here are a few takeaways and a short discussion about some important issues. Be sure to check the Q&A on the ProjNet website for any official responses from the Army on these topics. 

Continue Reading...

Southwestern Public Service Company Seeks Renewable Energy

Southwestern Public Service Company (“SPS”), a subsidiary of Xcel, has issued a request for proposals to diversify its existing renewable energy portfolio in New Mexico. SPS is seeking, on an annual basis, approximately 88,705 MWh of “Other” renewable energy generation as defined by the New Mexico Public Regulation Commission Rule 572 NMAC (i.e., other than solar and wind) or an equivalent amount of biogas of approximately 665,300 MMBtu to be in commercial operation no later than January 1st, 2015.

Bidders that intend to submit a proposal are REQUIRED to submit a Notice of Intent to Bid no later than Friday August 31st, 2012.  The submission deadline is 5:00 P.M. Mountain Time on Monday, October 1st, 2012.  More information can be found here on Xcel Energy's web site.

Hydropower Regulatory Efficiency Act Unanimously Passes U.S. House

Stoel Rives congratulates the members and staff of the National Hydropower Association ("NHA") who worked hard to achieve last night's 372-0 passage of HR 5892, the Hydropower Regulatory Efficiency Act of 2012, in the U.S. House of Representatives.  While there is still work to be done in the Senate, the unanimous vote in the House shows that hydropower is a clean, renewable energy source with a broad base of support on both sides of the aisle.  For more information on the legislation and its potential to increase hydropower generation and jobs across the county, visit NHA's website.  Stoel attorneys are proud to have worked with NHA staff to help advance the association's legislative goals.

NHA Publishes Interactive Hydro Supply Chain Snapshot

Posted on behalf of Stoel Rives partner Cherise Oram.

The National Hydropower Association (NHA) recently published a new interactive map resource showcasing the vibrant contribution of hydropower in the American energy economy. Titled the Hydro Supply Chain Snapshot, the map showcases nearly 2,000 companies involved in the non-federal hydropower supply chain, including project developers, generators and major suppliers.

Visit the NHA website to view the Snapshot resource.

DOE Concludes 1603 a Big Job Creator

A surprise to no one involved in renewable energy, the DOE (via NREL) has just issued a report concluding 1603 created tens of thousands of new jobs.

See the report at http://www.nrel.gov/docs/fy12osti/52739.pdf

 

Gov. Kitzhaber Names Margi Hoffman as Oregon's Energy Policy Advisor

Oregon Governor John Kitzhaber announced today that he has named Margi Hoffman to serve as his Energy Policy Advisor.  She will join the Governor's office on April 2.

Ms. Hoffman has served as Senior Vice President and Director of Oregon Operations with Strategies360, a strategic consulting firm, and has also worked closely with Renewable Northwest Project (RNP) .  The news release from the Governor's office can be found here.

Congratulations, Margi!

Upcoming Event: Energy Storage for the Grid: Watchful Waiting or the Perfect Storm?

I'll be moderating Energy Storage for the Grid: Watchful Waiting or the Perfect Storm? at the MIT Enterprise Forum Northwest's May 8, 2012 program at Seattle's Museum of History and Industry (MOHAI) , 2700 24th Ave East.  The event, which includes a networking reception, will be held from 5:00 to 8:30 pm. 

The evening's panelists will be:

  • Terry Oliver, Chief Technology Innovations Officer, Bonneville Power
    Administration
  • Alexander H. Slocum, Professor, Massachusetts Institute of Technology
  • Chris Wheaton, Chief Operating & Financial Officer, EnerG2
  • Nathan Adams, Manager of Development and Emerging Technologies, Puget Sound Energy

Among other topics, the panel will address:

  • The most promising energy storage strategies
  • How different storage methods could work together with the grid in the Northwest and nationally
  • How entrepreneurs, the changing energy marketplace, grid operators, and utilities are responding to the call to build the foundation for a clean energy economy 

For more information about this event, visit MITEF Northwest's web site

I hope to see you there!  In the meantime, for those who are following energy storage, I'm "tweeting" regularly on that topic as well as Department of Defense renewables procurement  at @BillHolmesStoel (#energystorage)

 

New DOE Resource Assessments Nudge Wave and Tidal Energy Forward

The U.S. Department of Energy (“DOE”) recently released two new nationwide resource assessments for wave and tidal energy projects in the U.S. The reports, funded by the DOE and prepared by the Electric Power Research Institute ("EPRI") and the Georgia Tech Research Corporation, present the most rigorous and comprehensive analysis to date on the magnitude of the resources available for electricity generation and where those resources are located.

Wave Energy: The wave energy report, “Mapping and Assessment of the United States Ocean Wave Energy Resource” states (as most expected) that the best resources are on the West Coast, including Alaska and Hawai’i. EPRI calculated the resource’s potential to be 400 gigawatts nationally.

Tidal Energy: The tidal energy report, “Assessment of Energy Production Potential from Tidal Streams in the United States” follows on the heels of the DOE’s release of its interactive national tidal resource database in July 2011. For more on the database and relevant links, see my blog on the topic.

Ocean Current, Ocean Thermal Gradients, and New Hydropower: In addition to these two new reports, the DOE anticipates releasing additional resource assessments for developers of ocean current, ocean thermal gradient, and new hydropower projects.

Based on our experience assisting clients to develop wave, current, and tidal energy projects across the country, we are encouraged by both the results of the resource assessments and the DOE's encouraging perspective on the role that new hydropower and hydrokinetic projects should have in expanding the nation's renewable energy resource mix.

For detailed information on all aspects of marine and hydrokinetic project development, download a PDF of our recently updated Law of Marine and Hydrokinetic Energy.

Verdant Power Receives First FERC Pilot Project License

Today, the Federal Energy Regulatory Commission ("FERC") issued its first pilot project license for a tidal energy project to Verdant Power, LLC for its Roosevelt Island Tidal Energy ("RITE") Project in New York's East River (pictured at right).  As a first-of-its-kind license, this is a significant step for the burgeoning tidal energy industry in the United States.

According to the license, the project will be construted in three phases over a five year period.  When complete, the project will consist of thirty 35-kW, 5-meter-diameter axial flow Kinetic Hydropower System ("KHPS") turbines with a total installed nameplate capacity of 1.05 MW.  Verdant must begin construction on Phase 1 within the next two years and must complete Phase 3 within six years.  The license was issued for the full 10 years requested in Verdant's license application.

Although the levelized cost of energy for the RITE project is high relative to other energy sources, the Commission stated clearly that "[t]his project's value . . . lies in its successful testing and demonstration of Verdant's KHPS turbine technology, and the project's ability to raise the profile of, and advance, the emergent tidal energy industry." 

The license can be found on FERC's website under Docket No. P-12611-005.

For more detailed information on the FERC pilot project licensing process, see Chapter 3 of our recently updated Law of Marine and Hydrokinetic Energy.

Hydropower Regulatory Efficiency Act of 2011 Introduced in the House of Representatives

Today, Reps. Cathy McMorris Rodgers (R-WA) and Diana DeGette (D-CO) introduced H.R.3680, the "Hydropower Regulatory Efficiency Act of 2011", in the U.S. House of Representatives.  Here is a summary of the bill's major provisions:

  • Would exempt small hydroelectric facilities of 10 MW or less from the Federal Energy Regulatory Commission ("FERC") licensing process (currently, the exemption applies to facilities of 5 MW or less);
  • Would remove conduit hydroelectric facilities of 5 MW or less from FERC jurisdiction (such facilities would not be required to file for a license or an exemption from licensing);
  • Would exempt all conduit hydroelectric facilities of 40 MW or less from the FERC licensing process (currently, the exemption applies to facilities of 15 MW or less, or 40 MW or less in the case of municipal water supply projects);
  • Would permit the development of conduit hydroelectric facilities on Federal land;
  • Would provide FERC the ability to extend preliminary permits for up to an additional 2 years in certain circumstances;
  • Would require FERC to investigate the feasibility of a 2-year licensing process for the development of (1) hydroelectric facilities at nonpowered dams and (2) closed-loop pumped storage facilities;
  • Would require the Department of Energy to study the potential for conduit hydropower development and potential sites for pumped-storage facilities located near existing or potential sites of intermittent renewable energy projects (e.g., solar, wind); and
  • Would require the President to submit a report to Congress on actions taken by the DOE and other Federal agencies pursuant to the memorandum of understanding on hydropower that was signed on March 24, 2010.

Many of these provisions are similar to those contained in S.629, the "Hydropower Improvement Act of 2011", which was introduced in the Senate on March 17, 2011 by Sen. Lisa Murkowski (R-AK).  Notably, however, approximately $100 million in research and development funding included in S.629 was not included in the House bill. 

The National Hydropower Association ("NHA") and Stoel Rives partner Cherise Oram, a member of the NHA's Legislative Committee, have worked closely with Members on both sides of the aisle over the past several months to develop the language of H.R.3680.  NHA supports the bill and is pleased with both the bipartisan support of its original co-sponsors and the additional interest that has been shown by democrats and republicans in different regions of the country.

What's Happening in Small Hydro and Hydrokinetics?

Some very noteworthy things have happened this month in the world(s) of small hydro and hydrokinetics in the United States. Here’s a quick summary:

1.         U.S. Departments of Energy and the Interior Award ~$17 Million for Advanced Hydropower R&D. On September 6, 2011, Secretaries Chu and Salazar announced that the two agencies will provide nearly $17 million in funding over three years for research and development projects to advance hydropower technology. The money was awarded to 16 projects in 11 states through a competitive grant process first announced at the National Hydropower Association conference in April 2011. Congratulations to the winners:

 

·         Sustainable Small Hydro Projects: Earth by Design, Hydro Green Energy (2 awards), Percheron Power, Sacramento Municipal Utility District, Near Space Systems, Natel Energy, New Mexico State University, Walker Wellington, and Weisenberger Mills.

 

·         Sustainable Pumped Storage Hydropower: Sacramento Municipal Utility District, Argonne National Laboratory.

 

·         Environmental Mitigation Technologies for Conventional Hydropower: Electric Power Research Institute (EPRI), Pacific Northwest National Laboratory, Regents of the University of Minnesota.

 

·         System Testing at Bureau of Reclamation Facility: Natel Energy.

 

For more on the announcement and the categories considered under the Funding Opportunity Announcement (DE-FOA-0000486), see my blog covering the announcement from April 2011. 

 

2.         FERC Approves First Small Hydro Project Under MOU with Colorado. In August of 2010, the Federal Energy Regulatory Commission (“FERC”) and the State of Colorado signed a Memorandum of Understanding (“MOU”) which has finally borne fruit. On September 14, 2011, FERC granted a license exemption for the 23 kW Meeker Wenschhof hydroelectric project (FERC Docket No. P-14230), to be located on an existing irrigation pipeline near the town of Meeker in Rio Blanco County. This is the first project approved by FERC under the new simplified procedures adopted under the MOU. The approval took a mere 2 months. The announcement can be found here. For FERC’s press release, click here. To read more about the MOU, see my blog from last year which includes a summary and a link to the MOU.

 

3.         The Marine and Hydrokinetic Renewable Energy Promotion Act of 2011 Introduced in the U.S. House of Representatives. On September 21, 2011, Congressman Jay Inslee (D-WA), together with Congressman Ted Deutch (D-FL) and Congressman Don Young (R-AK), introduced H.R. 2994, legislation that would boost research grants, loans and tax incentives available for scientists, engineers, and entrepreneurs working to develop and deploy ocean-generated energy in the United States. Mr. Deutch’s district (Florida 19) is home to the Southeast Marine Renewable Energy Center located at Florida Atlantic University. The bill has been referred to the House Science, Space, and Technology Committee as well as the House Energy and Commerce Committee. For the full text of the bill, click here.

Upcoming Energy Conference Highlights

Through industry presentations and publications as well as through our blog, our energy attorneys are dedicated to helping you stay informed and knowledgeable about legal developments that affect your business.

Visit our website for the latest calendar of events. Upcoming highlights include:

Utah Solar Tour 2011
September 24 – Salt Lake City, UT
Join Stoel Rives attorney Julia Pettit for the Utah Solar Energy Association’s annual Solar Tour. This year’s tour features sites with geothermal heat pumps, small wind, passive solar design, solar shingles, and many energy efficiency design techniques. Stoel Rives is proud to be a Gold sponsor at this event.

In-Depth Tax Planning for Renewable Energy Projects
September 26 – Chicago, IL
Stoel Rives attorneys Greg Jenner, Adam Kobos, Carl Lewis and Kevin Pearson will serve as faculty for this course which will outline tax issues involved in developing renewable energy projects and negotiating tax equity incentives.

REFF West
September 26-27 – San Francisco, CA
Join Duff Bryant, Julia Pettit, John McKinsey and over 400 senior executives and investors as they discuss opportunities for private equity and venture capital in clean tech energy companies. Review in detail the latest technologies moving the industry forward, and examine prospects for rapid renewable growth across the West Coast. Be sure to visit Stoel Rives in the exhibit hall!

National Hydropower Association Pumped Storage Workshop
October 3 – Bellevue, WA
Join Stoel Rives attorneys Bill Holmes, David Benson, Cherise Oram, and Michael O’Connell for this workshop intended for industry professionals with an interest in the development of new pumped storage projects. Bill Holmes will join the discussion panel What Would Energy Storage Asset/Revenue Modeling Look Like? from 4:00-5:00 p.m.

Independent Energy Producers Association Annual Meeting
October 3-5 – South Lake Tahoe, CA
John McKinsey and Seth Hilton will be in attendance at The IEP 30th Annual Meeting, featuring speakers from CPUC, CARB, CEC, and FERC. Stoel Rives is a proud sponsor at this event.

Developing Grid Storage Projects
October 5-6 – Dallas, TX
John Thompson, David Hattery and Bill Holmes are headed to Dallas to explore market opportunities, models, technologies and barriers to energy storage. Bill Holmes will Chair the conference, and instruct the pre-conference workshop, Developing the Business Case for Grid Storage on October 5. Other Stoel Rives presentations on October 5 include John Thompson, presenting Intellectual Property Protection for Grid Storage, and David Hattery, presenting Negotiating the Terms and Navigating the Risk of a Procurement Contract and Other Financial Documents.

Biogas USA West 2011
October 11-12 – San Francisco, CA
Visit with David Benson and Lee Smith, who will join the discussion panel Project Development Optimization on October 11. Be sure to attend the post-conference event reception, proudly hosted by Stoel Rives.

Solar Power International
October 17-20 – Dallas, TX
Stoel Rives attorneys David Benson, Kristen Castaños, Bill Clydesdale, David Hattery, Bill Holmes, Greg Jenner, Morten Lund, Jennifer Martin, Julia Pettit, David Quinby and Howard Susman are headed to Dallas! Julia Pettit will join the Financing Strategies for Utility-Scale Projects discussion panel, and Bill Holmes will moderate the discussion panel, Energy Storage Market and Policy Developments. Visit Stoel Rives at booth #3043 in the exhibit hall!

GEA Geothermal Energy Expo & GRC Annual Meeting
October 23-26 – San Diego, CA
Stoel Rives attorneys John McKinsey and Erin Anderson will be in attendance at the Geothermal Energy Association Energy Expo, co-located with the Geothermal Resources Council Annual Meeting. Erin Anderson will present during the pre-meeting workshop, held on Friday, October 21 from 8 a.m. – 5 p.m. While you’re there be sure to visit Stoel Rives in the exhibit hall!

CALIFORNIA RPS: Meeting the Mandate
October 24-25 – Los Angeles, CA
On Monday, October 24, Seth Hilton will present, In-State vs. Out-of-State Renewable Resources to Satisfy RPS Requirements from 10:30-11:15 a.m.

Green Energy M&A Outlook for 2012
November 15-16, 2011 – Santa Clara, CA
Stoel Rives’ Duff Bryant and Ed Einowski, will serve as Summit Co-Chairs, and on Tuesday, November 15, Julia Pettit will moderate the discussion panel, The Green Corporate M&A Landscape, from 8:45 - 9:45 a.m. Stoel Rives is proud to be a Platinum Sponsor of this event.

To see the full calendar of events, click here.

If you currently subscribe to Stoel Rives legal updates, click here to update your contact information and preferences. To join the Stoel Rives mailing list and ensure direct delivery of future alerts, click here to subscribe. To unsubscribe, send an email to unsubscribe@stoel.com.

Great River Energy Issues Request for Proposals

On August 15, 2011, Great River Energy (GRE) issued a request for proposals (RFP) for community-based energy development (C-BED) renewable energy resources.  Eligible energy technologies include: wind, solar, hydroelectric of less than 100 megawatts, biomass, municipal solid waste, landfill gas and anaerobic digesters, and hydrogen produced from any of the previous resources.

In announcing the RFP, GRE noted that it already has enough renewable resources in its energy portfolio to meet Minnesota's Renewable Energy Standard.  Minnesota's RES requires electric utilities to supply an increasing percentage of their energy sales from renewable energy sources, reaching 25 percent by 2025. Nevertheless, GRE issued the RFP to "evaluate if additional C-BED renewable resources can provide value to our member cooperatives in the future," according to Jon Brekke, Great River Energy vice president of member services.  GRE plans to evaluate proposals based on their impact to wholesale power rates and other factors.

Proposals are due before 4pm Central Prevailing Time on Sept. 9, 2011.  GRE plans to notify short listed bidders by September 30 and has targeted November 1, 2011 as the execution date for a power purchase agreement (PPA).  GRE is clearly looking for bargains from developers who can take advantage of the Section 1603 cash grant, a program that expires on December 31, 2011, and who can place a project in service by December 31, 2012.  Since projects seeking the cash grant will need to "begin construction" (as that concept is defined in Section 1603) by December 31, 2011, the November 1 target execution date will likely be critical for developers seeking to arrange project financing before year end.

GRE is interested in entering into a PPA rather than a build-transfer or other ownership arrangement.  GRE's form of PPA can be found here.   The RFP itself can be found here.  For more information about the RFP, contact Mark Rathbun at 763-445-6104 or 2011cbedrenewablerfp@grenergy.com.

Section 1603 Cash Grants for Renewable Energy Projects TeleBriefing

With the end of 2011 drawing near, many renewable energy developers are seeking to qualify their projects for the Section 1603 cash grant.  Developers continue to try to understand the complexities surrounding the grant requirements, especially the determination of when projects are considered to have met the “beginning construction” requirement.

On August 24, I'll moderate a Law Seminars International (LSI) Telebriefing on Section 1603, featuring Stoel Rives partner Greg Jenner and  Victoria McDowell, the Compliance Program Manager, Section 1603 Program, U.S. Department of the Treasury. 

The TeleBriefing will take place from 10 AM – 11 AM Pacific Time/ 1 PM -- 2 PM Eastern Time.  During the briefing, attendees will learn how to meet the “beginning construction” test and receive clarification from the Treasury Department on project requirements.  We'll also discuss the fate of projects that fail to qualify for the cash grant.

 

Registration is available online through Law Seminars International.

 

Puget Sound Energy Files for WUTC Review of "All-Source" RFP

Puget Sound Energy (PSE) has filed with the Washington Utilities and Transportation Commission (WUTC) a Request for Proposals for All Generation Sources (the all-source RFP) and a Request for Proposals for Electric and Demand Side Resources (energy-efficiency RFP). PSE filed the draft all source RFP on August 1, 2011 and plans to issue a separate energy efficiency RFP later.  

Under the all source RFP, PSE is seeking proposals for energy generation resources as capacity generation resources, as well as transmission products from BPA’s system to PSE's system. PSE is willing to consider both existing generation resources and resources that are under development but expected to achieve commercial operation no later than December 2015. According to PSE, a revised assessment of its portfolio needs and peak customer power requirements demonstrates a need for approximately 500 MW of capacity by the end of 2012.  PSE would be willing to consider various commercial arrangements under the RFP, including power purchase agreements, temporal exchange agreements, ownership arrangements (e.g., a transfer of development assets, a build-transfer arrangement, or sale of an existing asset), as well as transmission-only products from BPA’s system.

 

PSE will be hosting an RFP Proposal Conference on August 16, 2011, in Bellevue, Washington, to discuss the all-source RFP. To register for the conference, email janice.brown@pse.com. Public comments on the draft RFP are due on September 2, 2011, and PSE expects to receive WUTC approval by September 28. If the schedule holds, PSE plans to issue the final RFP solicitation on October 5, 2011.  PSE expects to select a final short list and notify respondents in 1Q 2012.

PSE’s web page for the RFP (including its proposed schedule and the draft RFP itself) can be found here.

Upcoming Energy Conference Highlights

 

Through industry presentations and publications, our energy attorneys are dedicated to helping you stay informed and knowledgeable about legal developments that affect your business.

Visit our website for the latest calendar of events. Upcoming highlights include:

Compressed Air Energy Storage (CAES): Lessons Learned from Natural Gas Tolling
July 21 – WEBINAR
Stoel Rives Partners Bill Holmes, Ed Einowski and Marcus Wood will serve as the exclusive faculty this 90-minute webinar, part of the “Law of Renewable Energy Series” presented by Stoel Rives and EUCI.

Renewable Energy in the Pacific Northwest
August 4-5 – Seattle, WA
Join partners Steve Hall, Tim McMahan (conference co-chair) and Michael O'Connell for sessions on "Getting Renewable Power to Market," “Working with Tribes: Lessons from Case Studies in Their Roles as Developers and Commercial Partners,” and “Best Practices for Engaging with Leasing and Permitting Agencies,” among others.

GEA National Geothermal Summit
August 16-17 – Reno, NV
Attorneys John McKinsey, Jennie Bricker, Tami Boeck, Michael O'Connell and Allison Smith are heading to Reno, Nevada for the first annual National Geothermal Summit, presented by the Geothermal Energy Association. Stoel Rives is proud to be a Gold Sponsor at this event.

Renewable Energy in the Midwest States: New Policy, Business and Legal Developments
August 25-26 – Minneapolis, MN
Join Minneapolis-based partners Mark Hanson and Greg Jenner for sessions on "Special Legal Issues for Biofuels Development," and "Commercialization and Financing Structures: What Will Future Deals Look Like?"

National Hydropower Association Alaska Regional Meeting
August 30-31 – Girdwood, AK
Greg Jenner will speak on tax incentives for development of renewable energy, development alternatives, and DOE funding.

Utility Scale Solar Summit 2011
September 13-15 – San Diego, CA
Stoel Rives is proud to be a Platinum Sponsor at this Infocast event, and serve as Chair of the “Solar Project Development Briefing.” Join attorneys Howard Susman, Morten Lund, Greg Jenner, Ed Einowski, Jennifer Martin, David Quinby and Seth Hilton in sunny San Diego. We are pleased to offer a 15% registration discount, use code 115321.

RETECH 2011
September 20-22 – Washington, DC
Visit Stoel partners Bill Holmes, Ed Einowski and Graham Noyes at booth #819 in the Exhibit Hall. We’ll also be participating in sessions covering wind and energy storage topics.

You’ll see Stoel Rives sponsoring and/or speaking at Turbines, Towers & Vessels in Rhode Island, Northwest & Intermountain Power Producers Coalition (NIPPC) Annual Meeting in Washington, Transmission West Summit in San Diego, ACORE’s REFF West in San Francisco, CanWEA Annual Conference in Vancouver, Solar Power International in Dallas, and many more this fall.

To see the full calendar of events, click here.

To join the Stoel Rives mailing list and ensure direct delivery of future alerts, click here to subscribe. To unsubscribe, send an email to unsubscribe@stoel.com.

 

 

Coming Very Soon: CPUC Energy Storage Workshop

On Tuesday, June 28, 2011, the CPUC will hold an “Electric Energy Storage Workshop” as part of its R10-12-007 proceeding for AB 2514, which defines the process by which the CPUC will consider electric energy storage standards for California’s investor owned utilities. The workshop will be held at in the Golden Gate Room at CPUC’s headquarters from 9:30 am to 4:00 pm.

According to a draft agenda circulated by the CPUC, the theme of the workshop will be addressing barriers to entry facing Electric Energy Storage (EES). The workshops goals are to identify actions that the CPUC should consider, as well as whether and how it should participate in other forums.

The morning will feature presentations from several different perspectives, with each presentation to be followed by Q&A:

 

  • Presentation from UC Berkeley and California Energy Commission (CEC) team on “2020 Vision Project”
  •  

  • Presentation from CAISO about recent storage-related activities at the Independent System Operator, including findings from recent studies.
  •  

  • Presentation from Southern California Edison (SCE) discussing a white paper entitled Moving Energy Storage from Concept to Reality.
  •  

  • Presentation from California Energy Storage Alliance about developer’s perspectives

The afternoon will feature a facilitated presentation about a staff straw proposal concerning potential CPUC actions. The CPUC will allow parties to provide post-workshop comments on both the presentations and the staff straw proposal.

The CPUC is willing to accommodate short presentations (five minutes or less) or share prepared material pertinent to the workshop. Any party who wishes to do so may contact Michael Colvin at michael.colvin@cpuc.ca.gov. For reference (or inspiration), a series of energy storage presentations made to the CPUC as part of its 2011 IEPR process can be found here.

Stoel Rives attorneys Seth Hilton and Janet Jacobs will be attending the workshop.

FERC Seeks Comments on Ancillary Markets and Energy Storage

On June 16, 2011, the Federal Energy Regulatory Commission (FERC) issued a Notice of Inquiry (NOI) seeking comments on what it described as two separate but related issues, both of which apply to electric energy storage (EES). 

First, because FERC is interested in facilitating the development of robust competitive markets to provide ancillary services from all resources types, it seeks comment on “existing restrictions on third-party provision of ancillary services, irrespective of the technologies used for such provision.” In soliciting these comments, FERC noted the growing interest in rate flexibility among sellers of ancillary services, and a desire from those obligated to purchase those services to increase the available supply. Although a variety of resources can provide ancillary services, FERC believes that many are discouraged from doing so by the Commission’s restrictions on market-based pricing coupled with a lack of access to information that could help satisfy the requirements of those policies. Access to information is particularly difficult outside of areas served by RTOs/ISOs, which areas are often with the greatest need for an ancillary services market.

 

FERC pointedly invites comments on whether it should revise or replace the restriction set forth in Avista Corp., 87 FERC ¶ 61,223, order on reh’g, 89 FERC ¶ 61,136 (1999), which prohibits, absent a study showing lack of market power, third-party market-based sales of ancillary services to transmission providers seeking to meet their ancillary services obligations under the Open Access Transmission Tariff (OATT). Assuming that FERC revises or replaces the Avista restriction to facilitate the provision of ancillary services, it also seeks input on how it should contemporaneously ensure just and reasonable rates. In a related inquiry, the Commission is seeking comments on whether the various cost-based compensation methods for frequency regulation that exist in regions outside of organized markets can be adjusted to address the speed and accuracy issues identified in FERC’s recent Frequency Regulation Notice of Proposed Rulemaking for organized wholesale energy markets. See Frequency Regulation Compensation in the Organized Wholesale Power Markets, 76 FR 11177 (March 1, 2011), Notice of Proposed Rulemaking, FERC States & Regs ¶ 32,672 (2011). The June 16 NOI, when considered in context with this year’s NOPR on Frequency Regulation and last year’s NOI on EES, could signal that a broader rulemaking regarding EES is on the horizon.

 

Recognizing that “the role of electric storage and other new market entrants play in competitive markets is still evolving,” the Commission seeks comments on whether it should revise “current accounting and reporting requirements as they pertain to the oversight of jurisdictional entities using electric storage technologies” other than pumped storage hydro (for which FERC has established methods of accounting, reporting and rate recovery). Current utility accounting requirements do not appropriately fit EES due to the technology’s abilities to act like generation, transmission, and distribution assets. Accordingly, FERC is soliciting “specific details regarding whether and, if so, how to amend the current accounting and reporting requirements to specifically account for and report energy storage operations and activities.”

 

The NOI was published in the Federal Register on June 22, 2011, and comments are due sixty (60) days from that date.

 

Thanks to my colleague Jason Johns for his comments on this posting!

California Public Utilities Commission Holds Prehearing Conference on Energy Storage Procurement Targets

As we’ve previously discussed, California’s AB 2514 requires the CPUC and municipal utilities in California to open proceedings by March 1, 2012 to determine appropriate targets, if any, for the procurement of viable and cost-effective energy storage systems by load-serving entities. Over a year before that deadline, the CPUC opened Rulemaking 10-12-007 in December of last year to both implement AB 2514 and “on [the CPUC’s] own motion to initiate policy for California utilities to consider the procurement of viable and cost effective storage systems.” In early March, the CPUC held an initial workshop on the scope of the rulemaking proceeding.

On April 21, the Commission held a prehearing conference to determine the scope and schedule for the proceeding. Stoel Rives partner Seth Hilton attended the conference. Among the issues discussed at the prehearing conference, led by Administrative Law Judge Yip-Kikugawa, was whether to conduct the proceeding in phases (e.g., first examining how storage might be applied, and then in a subsequent proceeding setting what the mandate will be for storage procurement), the issues to be covered in each phase , and whether evidentiary hearings would be necessary. 

According to ALJ Yip-Kikugawa, a scoping memo should issue in the next two to three weeks. The scoping memo will set out the issues to be considered in the proceeding and a schedule for their resolution. 

We'll be posting further information on Renewable + Law Blog when the scoping memo comes out, so stay tuned for further developments.

LexisNexis Selects Renewable + Law Blog to its Top 50 Environmental Law Blogs List

Having first reported to our readers in February that LexisNexis had nominated the Stoel Rives Renewable + Law Blog for its Top 50 Environmental Law & Climate Change Blogs for 2011 award, we are pleased to announce we made the list of winners! In publishing its Top 50 list, LexisNexis declared that our Renewable + Law bloggers’ “avowed passion for solar energy, wind energy, biofuels, ocean and hydrokinetic energy, biomass, waste-to-energy, geothermal and other clean technologies is evident in the care they take with this blog-the posts are frequent, the topics are interesting and cutting edge, and the writing is top notch.”

 

Thanks again to all our readers who make regular use of Renewable + Law Blog and those who wrote in to support us for this award. We're honored and inspired, and we plan to keep those Blogs and letters coming.

 

DOE and Interior Announce $26.6 Million for Hydropower R&D

At the National Hydropower Association conference in Washington, D.C. earlier this week, Department of Energy ("DOE") Secretary Steven Chu and Department of the Interior ("DOI") Secretary Ken Salazar announced a $26.6 million grant program to advance the development, testing, validation, modeling, and interconnection of advanced conventional hydropower systems.  The agencies' news came at the same time that the DOE's Oakridge National Laboratory announced that as much of 12.6 GW (12,600 MW) of additional hydropower capacity can be drawn from the nation's waterways if generating facilities are added to 54,000 dams (including federal projects) that currently do not have them.  The top 100 of those sites could add up to as much as 8 GW (8,000 MW) of capcity.

Topics 1, 2, and 3 of the Funding Opportunity Announcement  (DE-FOA-0000486) will be funded by the DOE's Office of Energy Efficiency and Renewable Energy ("EERE").  Topic 4 will be jointly funded by the EERE and the DOI's Bureau of Reclamation.  The topics are as follows:

  • Topic 1.  Sustainable Small Hydropower.  $10.5 million over three years to advance research and development of small hydropower facilities to be installed at existing facilities (e.g., dams, conduits).
  • Topic 2.  Sustainable Pumped Storage Hydropower.  $11.875 million over four years to provide assistance to projects already in development.  Preference will go to projects that will begin construction in 2014 and assist with grid integration of variable resources like wind and solar.
  • Topic 3.  Environmental Mitigation Technologies for Conventional Hydropower.  $2.25 million over three years for R&D related to issues facing conventional hydropower technologies (e.g., turbine efficiencies and fish mortality).
  • Topic 4.  Advanced Hydropower System Testing at a Bureau of Reclamation Facility.  $2 million over three years for system testing of low-head hydropower technologies at existing, non-powered Bureau of Reclamation facilities.

Letters of Intent for the FOA are due no later than 11:59 p.m. Eastern Time on May 5, 2011.  Applications are due no later than 11:59 p.m. Eastern Time on June 6, 2011.

A Unique RFP for Energy Storage

Santa Fe-based Chamisa Energy Corporation recently announced a request for proposals for up to 250MW of nameplate wind generation resources to be used to provide energy to a 135 MW or larger compressed air energy storage (CAES) facility under development in Swisher County in the Texas panhandle.  The proposed CAES facility would compress air and store it in solution-mined underground caverns.  To convert the stored potential energy back into electricity, the stored air would be released and mixed with a small amount of natural gas to drive a turbine.  The RFP describes CAES as a "bulk electric storage technology used to complement wind energy generation so that wind energy becomes a fully dispatchable resource suitable for peaking, intermediate, baseload or tolling resource." 

The energy would be provided to the facility pursuant to a power purchase agreement (PPA).  Chamisa invites wind plants located either in the Southwest Power Power (SPP) or the Electric Reliability Council of Texas (ERCOT) to respond. Chamisa will consider proposals that supply wind energy for seven years, but prefers a minimum term of 15 years.  The target date for delivering electricity to the Storage Facility is the second quarter of 2014. 

Chamisa notes that it is not aware of completed or pending PPAs between WGR and CAES facilities, and thus anticipates that the successful proposal "will be creative in its approach to the RFP."  Although the RFP isn't explicit on the point, Chamisa's plan may be to purchase energy from a wind generator or wind generators pursuant to the PPA, store the energy, and then sell the electricity and ancillary services from the facility to a third-party off-taker.  If Chamisa can take the bulk of the energy into CAES primarily in off peak hours and then sell the stored energy during on-peak hours, might in theory be able to profit on the arbitrage between the two price points, although past efforts to get grid-scale storage to pencil out on that basis have had limited success.  Alternatively, the facility may be able to profit by using the stored energy to provide ancillary services, grid congestion relief, grid stability and support for grid expansion.

In principle, the CAES facility could also be used in a tolling arrangement by which a utility or a seller of wind energy hires the CAES facility for storage, pays a reservation and storage charge to Chamisa, and then dispatches the stored energy at will--in other words, the third-party offtaker could be the same party as the generator delivering the wind energy to the facility (e.g., a utility that is buying wind energy that it wants to shift from off-peak hours to on-peak hours).  Under this structure, the party tolling electricity would retain title to the electicity being stored and could arbitrage or otherwise deploy the stored energy into the market as it saw fit.  However, a tolling transaction of that type isn't clearly called for by the RFP (although it doesn't appear to be precluded).

Regardless, Chamisa's RFP will be worth monitoring to see whether an independent storage developer can create a workable market structure for its storage assets in order to facilitate financing.  The outcome of this effort will be of great interest to developers of solar and wind resources, as well as to developers of pumped storage and other grid-scale storage solutions.

The deadline for written or email questions is March 31, 2011, and proposals are due no later than 5pm Mountain Standard Time on May 16, 2011.  If submitted by mail, proposal(s) must be postmarked May 16th.  E-mail submission is preferred.  You can access Chamisa's RFP by clicking here.

 

COMMISSIONER FLORIO NOTICES ALL-PARTY MEETING CONCERNING 2011 RENEWABLE PORTFOLIO STANDARD PROCUREMENT

 

On February 11, 2011, California Public Utilities Commission (CPUC) Administrative Law Judge Burton Mattson issued a Proposed Decision conditionally accepting the 2011 Renewables Portfolio Standard (RPS) Procurement Plans for Southern California Edison, Pacific Gas and Electric Company, and San Diego Gas and Electric Company.  If adopted, the Decision would set a schedule for the utilities’ 2011 RPS solicitation.  The Decision was on the agenda for the CPUC’s March 24, 2011 business meeting, but was held at Commissioner Florio’s request until the April 14 meeting.

 

On March 17, 2011, Commissioner Florio noticed an all-party meeting on the Proposed Decision for March 25, 2011.  Yesterday, Commission Florio circulated an agenda for the meeting.  Among the issues raised by the agenda is whether an RPS solicitation in 2011 is necessary and prudent.

 

Stoel Rives’ Partner Seth Hilton will be present at the all-party meeting, and will provide an update afterwards. 

Sen. Murkowski Introduces Bipartisan Hydropower Improvement Act

Today, Senate Natural Resources Committee Ranking Member Lisa Murkowski (R-AK) introduced bipartisan legislation to accelerate the deployment of hydropower projects across the country.  According to Murkowski, the Hydropower Improvement Act of 2011 "achieves common sense regulatory reform, spurs economic growth and takes advantage of hydropower's position as the country's leading source of clean, renewable energy."  Co-sponsor, Sen. Jeff Bingaman (D-NM) pointed out that the bill includes provisions that address hydropower development from smaller sources, emphasize the need to improve efficiency at existing facilities, and encourage development of hydropower at existing, non-electrified dams. 

Key provisions of the Hydropower Improvement Act, as summarized by the National Hydropower Association ("NHA"), include the following:

  • Grant Program:  Directs the U.S. Department of Energy ("DOE") to establish a competitive grant program to support efficiency improvements or capacity additions at existing hydropower facilities; adding generation to non-electrified dams; addressing aging infrastructure; conduit projects; environmental studies; and environmental mitigation measures.
  • Non-Powered Dams and Pumped Storage:  Directs the Federal Energy Regulatory Commission ("FERC") to explore a potential two-year licensing process for hydropower development at existing non-powered dams and closed-loop pumped storage projects.
  • Conduit and Small Hydro:  Allows for conduit projects on federal lands and directs FERC and other federal agencies to enter into a Memorandum of Understanding ("MOU") to better coordinate reviews of these projects.  Requires regional workshops to reduce barriers and investigate improvements to the regulatory process for small hydro and conduit projects.
  • Federal Hydropower Development:  Requires the Departments of Energy and the Interior and the Army Corps of Engineers to report to Congress on the impelmentation of the March 24, 2010 MOU on increasing federal hydropower development.  Also, directs FERC and the Bureau of Reclamation (the "Bureau") to complete a new MOU to improve the coordination and timeliness of non-federal hdyropower development at Bureau projects.
  • R&D Program:  Requires DOE to develop and implement a plan to increase the nation's use of hydropower through research, development, and demonstration initiatives.
  • Studies:  Directs DOE to study pumped storage project opportunities on federal and non-federal lands near existing or potential sites of intemittent renewable resource development, and a study of hydorpower potential from existing conduits.  Directs the Bureau to study barriers to non-federal development at Bureau projects.

The NHA has lauded the bill and each of its nine co-sponsors for recognizing "the vital role of hydropower as an affordable, reliable, available and sustainable domestic energy source."  Stoel Rives attorney Cherise Oram, NHA Legislative Affairs Committee Chair, assisted NHA staff in its work on the bill.

In addition to Sens. Murkowski and Bingaman, the bill's co-sponsors are Maria Cantwell (D-WA), Mark Begich (D-AK), Mike Crapo (R-ID), Patty Murray (D-WA), James Risch (R-ID), Sheldon Whitehouse (D-RI), and Ron Wyden (D-OR).

Upcoming Energy Conference Highlights

Through industry presentations and publications as well as through our blog, our energy attorneys are dedicated to helping you stay informed and knowledgeable about legal developments that affect your business.

Visit our website for the latest calendar of events. Upcoming highlights include:

Renewable Energy World Conference & Expo North America 2011
March 8-10, 2011 – Tampa, FL
Featuring speakers Bill Holmes, Greg Jenner, David Benson and Ramona Monroe. Visit us at booth #726 in the Exhibit Hall.

Tax Equity Financing for Renewables
March 16 - Webinar
This webinar, part of EUCI's Law of Renewable Energy Series, is instructed exclusively by Stoel Rives Partners Gary Barnum, Greg Jenner, Kevin Pearson, and Moderated by Ed Einowski. It will provide a refresher on the 1603 grant, the PTC and the ITC, and discuss the requirements and complexities of bonus depreciation, and the opportunities to utilize New Market Tax Credits.

Biomass for Power, Fuels and Chemicals
March 21-22 – Minneapolis, MN
Visit with Mark Hanson, Jennifer Martin, Bill Holmes, and John Eustermann, who will cover topics from PPAs and feedstock agreements to project due diligence and case studies.

Solar Power Finance & Investment Summit
March 22-24 – San Diego, CA
Join speakers Morten Lund and Howard Susman along with Julia Pettit, David Quinby, Brian Nese, Jennifer Martin, Kristen Castaños, Greg Jenner and David Benson in sunny San Diego – save 15% on conference registration with code 111561

Solar EPC and Long-Term Component Supply
March 28 – Webinar
Stoel Rives Partners Ed Einowski, David Hattery and Morten Lund will serve as the exclusive instructors for this webinar, part of the Law of Renewable Energy Series presented by EUCI.

National Hydropower Association's Annual Conference
April 4-6 – Washington, DC
Cherise Oram will discuss how best to navigate the Endangered Species Act at the Federal Energy Regulatory Commission licensing, relicensing and mid-license stages as she presents, "Working Toward Successful ESA Outcomes."

Reclamation Issues Draft Resource Assessment of Existing Hyrdo Facilities

Last week, the U.S. Department of the Interior's Bureau of Reclamation ("Reclamation") issued a draft report titled "Hydropower Resource Assessment at Existing Reclamation Facilities" (the "Resource Assessment") for public comment.  The Resource Assessment provides information on 530 exiting Reclamation sites and makes a preliminary determination about whether or not hydropower development at each facility would be economically viable.

To determine economic viability, Reclamation developed a Hydropower Assessment Tool which requires simple inputs of daily flows, headwater and tail water elevations.  According to Reclamation, the result is "valid information on potential hydropower production and economic viability."  Although the Resource Assessment does not claim to provide feasibility-level analyses for the sites, it does consider potential regulatory constraints related to water supply, fish and wildlife considerations, effects on Native Americans, water quality, and recreation, and adds the cost of mitigation to a projected total development cost for each site.  The Resource Assessment also provides benefit-cost ratios that both include and exclude renewable energy incentive prices. 

Importantly, Reclamation stated that the Resource Assessment is "targeted towards municipalities and private developers that could further evaluate the potential to increase hydropower production at Reclamation sites."  This is an indication that the federal government does not intend to develop the 192 sites that Reclamation identified as having hydropower potential.  Although this in itself is good news for developers, there's more.  For many of the Reclamation sites, developers would proceed under a Lease of Power Privilege Agreement rather than the Federal Energy Regulatory Commission licensing process set out in Part I of the Federal Power Act.  Such a lease would allow the developer to use the Reclamation facility for the purpose of generating electricity for up to 40 years. 

Comments may be submitted to Mr. Michael Pulskamp, Bureau of Reclamation, Denver Federal Center, Bldg. 67, P.O. Box 25007, Denver, Colorado 80225, or email to mpulskamp@usbr.govComments must be submitted by December 6, 2010.

REMINDER: Applications for SBIR and STTR Phase I Grants Due November 15th

Don't forget that the deadline for Phase I grant applications under the U.S. Department of Energy's ("DOE") Small Business Innovation Research ("SBIR") and Small Business Technology Transfer ("STTR") programs is 8:00 p.m. Eastern, November 15, 2010.  Qualified small businesses with strong research capabilities in science or engineering in any of the research areas identified in the September 28, 2010 Funding Opportunity Announcement are encouraged to apply.  Phase I grants of up to $150,000 will be awarded in FY 2011 under the SBIR; and grants of up to $100,000 will be awarded under the STTR. 

The Phase I Technical Topics document lists several areas of particular interest for the renewable energy industry.  Note that the following is not an exhaustive list.  The full list and descriptions can be found in the Phase I Technical Topics document.

  • Advanced Cooling and Waste Heat Recovery: Advanced Cooling; Advanced Waste Heat Recovery; Geoexchange heat pump (GHP) component R&D; Innovative GHP System/Loop Designs.
  • Production of Bioenergy and Biofuels from Cellulosic and Non-Food Biomass:  Biomass Feedstock Stabilization and Drying; Biomass Torrefaction; Sugar Catalysis to Advanced Biofuels and Chemical Intermediates; Pyrolytic Thermal Depolymerization.
  • Hydrogen and Fuel Cells:  Reducing the Cost of High Pressure Hydrogen Storage Tanks; Fuel Cell Balance-of-Plant; Demonstration of Alternative-Fuel Fuel CElls as Range Extenders.
  • Innovative Solar Power:  High Efficiency, Low Cost Thin Film Photovoltaics; Low Cost Building Integrated Photovoltaics; Static Module PV Concentrators; Solar-Powered Water Desalination; Distributed Concentrating Solar Power ("CSP").
  • Advanced Water Power Technologies: Pumped Storage Hydropower; Advanced Hydropower Systems; Wave and Current Energy Technologies; Advanced Component Design for Ocean Thermal Energy Conversion Systems.
  • Wind Energy Technologies: Transportation and Assembly of Extremely Large Wind Turbine Components for Land-Based Wind Turbines; Wind Energy Capture in Non-Conventional Wind Resources; Offshore Grid Infrastructure Hardware Development; Offshore Mooring and Anchoring Technology.

Detailed descriptions of each subtopic are included in the Phase I Technical Topics document.

Colorado Signs MOU for Small Hydro Development with FERC

On August 25, 2010, the Federal Energy Regulatory Commission ("FERC") and the State of Colorado signed a Memorandum of Understanding ("MOU") which could lead to simplified procedures and regulations for authorizing small-scale hydropower development in Colorado.  Although traditional hydropower has not seen significant new development in recent years, interest in small, low-impact projects is on the rise across the country.

In Colorado, federal surveys have identified several hundred potential small-scale hydropower projects under five megawatts (5 MW), which could have a combined capacity of more than 1,400 MW.  These new projects, if developed, could provide a needed boost for the state: on March 22, 2010, Colorado again increased its Renewable Energy Standard, requiring investor-owned utilities to procure 30% of their total retail sales from renewable resources by 2020. 

Under the MOU, "Colorado proposes to implement a pilot program to identify and test opportunities to simplify and streamline procedures and regulations for authorizing small scale hydropower projects in an environmentally sound manner."  The pilot process would require the State to prescreen projects to ensure that they qualify for either of the two exemptions from FERC's licensing provisions under Part I of the Federal Power Act: (1) the conduit exemption and (2) the 5 MW exemption.  While only facilities being added to existing infrastructure will qualify for the pilot program, the benefits for those projects are marked.  So long as Colorado state and federal resource agencies and any affected Indian tribe waive compliance with the consultation requirements of 18 CFR section 4.38(e) for a project prescreened by the State, FERC will waive the first and second stages of consultation in 18 CFR sections 4.38(b) and (c).  The pilot program will continue until 20 projects have gone through the program.

While FERC's offer to waive consultation may be considered a symbolic gesture because it is conditioned on a "first move" by the State and other federal agencies, the MOU still represents an effort by the agency to develop innovative ways to streamline new, small-scale hydropower development in Colorado. 

NOTE: Nothing in the MOU prevents a developer from proceeding through the traditional FERC licensing and exclusion process outside of the pilot program.  

FERC Comments on Electric Storage Technologies Due August 9

Just a friendly reminder that the deadline to submit comments to the Federal Energy Regulatory Commission (“FERC”) on electric storage technologies is just around the corner. In its Request for Comments Regarding Rates, Accounting and Financial Reporting for New Electric Storage Technologies, FERC’s Office of Energy Policy and Innovation seeks comments on the following issues: 

  1. The use of and rate treatment for storage facilities, including when it is appropriate to classify a storage facility as a transmission asset.
  1. The mechanisms by which a storage project that is used for multiple purposes may be compensated. Specifically, FERC seeks comment on whether a storage project may be compensated as transmission (e.g. for supporting unbundled transmission service by supplying reactive power) and also be compensated for providing ancillary services or for enhancing the value of merchant generation (e.g. by shifting output from an off-peak period to an on-peak period).
  1. The possibility of creating a stand-alone contract storage service and whether the storage provider would provide the service of electricity storage, enabling its customers to determine how to use their contracted share of the storage.
  1. Whether new accounting and reporting requirements should be created in order to facilitate cost of service or other rate policies for new storage technologies, such as chemical batteries and flywheels.

In addition to the issues outlined above and other specific questions posed by FERC in its Request for Comments, FERC invites comments on other related aspects of the storage issues not specifically addressed by FERC in the above-referenced document.  Comments are due on Monday, August 9, 2010 and should reference Docket No. AD10-13-000.     

Senators Propose Making Energy Storage Property Eligible for ITC & CREBs

Last week, Senators Jeff Bingaman (D-NM), Ron Wyden (D-OR), and Jeanne Shaheen (D-NH), introduced legislation that would add grid-connected energy storage property to the list of technologies eligible for the federal investment tax credit (the "ITC").  Under the Storage Technology for Renewable and Green Energy Act of 2010 (the "STORAGE 2010 Act"), eligible energy storage property would include hydroelectric pumped storage and compressed air energy storage, regenerative fuel cells, batteries, superconducting magnetic energy storage, flywheels, thermal energy storage systems and hydrogen storage.  Systems that can sustain a power rating of at least one megawatt for a minimum of one hour would be eligible for a 20% tax credit under the ITC program.  Should the bill become law, the tax credit would provide significant assistance to intermittent energy resource developers that are seeking new ways to shape and firm their projects' output.

The STORAGE 2010 Act would limit the available credits to $1.5 billion, and no single project may be allocated more than $30 million.

Importantly, the bill creates special extended deadlines for hydroelectric pumped storage facilities.  Whereas the majority of energy storage property considered under the bill would be required to be placed in service within two years of the date the ITC was allocated, pumped storage facilities would have three years to secure required licenses and permits, five years to begin construction, and eight years to be placed in service.

Compressed air energy storage systems would enjoy similar extended deadlines- i.e., would be reqired to begin construction within three years and be placed in service within five years.

The bill would also allow grid-connected energy storage property to qualify for Clean Renewable Energy Bonds under section 54C of the Internal Revenue Code.  The full text of the bill can be viewed here.

CPUC Staff Issues White Paper on Electric Energy Storage (EES)

Energy Electricty Storage (EES) is likely to become more and more important as intermittent solar and wind energy resources penetrate the grid.   EES may be a very useful and perhaps essential way to manage the variability of intermittent renewable energy resources to allow developers to continue building wind and solar projects at an accelerating pace.

On July 9, 2010, the Policy and Planning Division of the California Public Utility Commission (CPUC) issued an interesting Staff White Paper entitled "Electric Energy Storage: An Assessment of Potential Barriers and Opportunities." The report is worth reading for those who are interested in the future of renewable energy and the roll that EES can play in enhancing the deployment of intermittent renewables.

The report describes "a promising new set of Electric Energy Storage ("EES") technologies [that] appear to provide an effective means for addressing the growing problems of reliance on an increasing percentage of intermittent renewable generation resources."  The report observes that EES can provide several basice services, such as (1) supplying peak electricity demand by using electricity generated during periods of lower demand (e.g., storage of wind energy generated at night for use during daily peak periods), (2) balancing electricity supply and demand fluctuations over a period of minutes, and (3) deferring expansion of electric grid capacity (including generation, transmission and distribution). 

Potential storage technologies include pumped hydro, compressed air energy storage ("CAES"), batteries, thermal storage (e.g., solar thermal plants), flywheels, unltracapacitors and superconducting magnetic storage--the report provides short but helpful description of each technology.  Storage presents interesting legal and policy issues, because "[r]egulators are uncertain how EES technologies should fit into the electric system, in part because EES services provide multiple services such as generation, transmission and distribution."  In addition, "regulators do not yet know how EES costs and benefits should be allocated among these three main elements of the electric system." 

The report makes a number of recommendations, including that the CPUC should conduct a rulemaking to develop policies to remove barriers to the deployment of EES technology in California.  The report also proposes that the CPUC consider placing EES within California's energy resources loading order, require utilities to incoporate EES into their integrated resource planning processes, encourage CAISO to change ancillary service market rules to allow EES systems to more easily bid into regulation markets, and integrate EES into utility transmission planning.

The report concludes that "the major barrier for deployment of new storage facilities is not necessarily the technology, but the absence of appropriate regulations and market mechanisms that properly recognize the value of the storage resource and financially comepnsate the owners/operators for the services and benefits they provide."

You can find the report here.

CPUC Staff Issues White Paper on Electric Energy Storage (EES)

Energy Electricty Storage (EES) is likely to become more and more important as intermittent solar and wind energy resources penetrate the grid.   EES may be a very useful and perhaps essential way to manage the variability of intermittent renewable energy resources to allow developers to continue building wind and solar projects at an accelerating pace.

On July 9, 2010, the Policy and Planning Division of the California Public Utility Commission (CPUC) issued an interesting Staff White Paper entitled "Electric Energy Storage: An Assessment of Potential Barriers and Opportunities." The report is worth reading for those who are interested in the future of renewable energy and the roll that EES can play in enhancing the deployment of intermittent renewables.

The report describes "a promising new set of Electric Energy Storage ("EES") technologies [that] appear to provide an effective means for addressing the growing problems of reliance on an increasing percentage of intermittent renewable generation resources."  The report observes that EES can provide several basice services, such as (1) supplying peak electricity demand by using electricity generated during periods of lower demand (e.g., storage of wind energy generated at night for use during daily peak periods), (2) balancing electricity supply and demand fluctuations over a period of minutes, and (3) deferring expansion of electric grid capacity (including generation, transmission and distribution). 

Potential storage technologies include pumped hydro, compressed air energy storage ("CAES"), batteries, thermal storage (e.g., solar thermal plants), flywheels, unltracapacitors and superconducting magnetic storage--the report provides short but helpful description of each technology.  Storage presents interesting legal and policy issues, because "[r]egulators are uncertain how EES technologies should fit into the electric system, in part because EES services provide multiple services such as generation, transmission and distribution."  In addition, "regulators do not yet know how EES costs and benefits should be allocated among these three main elements of the electric system." 

The report makes a number of recommendations, including that the CPUC should conduct a rulemaking to develop policies to remove barriers to the deployment of EES technology in California.  The report also proposes that the CPUC consider placing EES within California's energy resources loading order, require utilities to incoporate EES into their integrated resource planning processes, encourage CAISO to change ancillary service market rules to allow EES systems to more easily bid into regulation markets, and integrate EES into utility transmission planning.

The report concludes that "the major barrier for deployment of new storage facilities is not necessarily the technology, but the absence of appropriate regulations and market mechanisms that properly recognize the value of the storage resource and financially comepnsate the owners/operators for the services and benefits they provide."

You can find the report here.

Interagency Ocean Policy Task Force Issues Final Recommendations

On Monday, July 19, 2010, the White House Council on Environmental Quality ("CEQ") issued the Final Recommendations of the Interagency Ocean Policy Task Force.  The Final Recommendations are the culmination of a process that began on June 12, 2009 when President Obama formed the Task Force and tasked it with developing recommendations to enhance national stewardship of the ocean, coasts, and the Great Lakes and promote the long-term conservation of those resources. 

The Final Recommendations will likely be carried over into an Executive Order to be signed by the President, which will establish a National Policy for the Stewardship of the Ocean, Coasts, and Great Lakes and create a National Ocean Council to enhance ocean governance and coordination between federal and state agencies.  The Final Recommendations also express the Task Force's unanimous agreement that the United States should acceed to the Convention on the Law of the Sea and ratify its 1994 Implementing Agreement.

The CEQ's press release is available here.  Attorneys at Stoel Rives are reviewing the Final Recommendations and assessing their impact on, among other things, offshore renewable energy development including offshore wind and marine and hydrokinetic projects.  Stay tuned for more on this important development.

New Tool for Renewable Energy Investors, Entrepreneurs, and Companies

On June 30, 2010, the U.S. Department of Energy ("DOE") launched its Technology Commercialization Portal (the "Portal").  The Portal is an online resource that provides a mechanism for investors, entrepreneurs and companies to identify new technologies coming out of DOE laboratories and other participating research institutions.  Relevant technologies include:

  • Advanced Materials
  • Biomass and Biofuels
  • Building Energy Efficiency
  • Electricity Transmission and Distribution
  • Energy Analysis Models, Tools and Software
  • Energy Storage
  • Geothermal
  • Hydrogen and Fuel Cell
  • Hydropower, Wave and Tidal
  • Industrial Technologies
  • Solar Photovoltaic
  • Solar Thermal
  • Vehicles and Fuels
  • Wind Energy

The Portal contains marketing summaries about the various DOE technologies that are available for licensing.  Each marketing summary describes a technology's applications, advantages, benefits and state of development.  Further, the Portal also provides access to information on patents and patent applications that have been created using DOE funding since 1992.

The Portal is located at http://techportal.eere.energy.gov/

Treasury Department Issues Additional Guidance Regarding Cash Grant Begin Construction Requirement

The U.S. Treasury Department today released on its website additional guidance regarding the "begin construction" requirement for qualifying for the 30% ARRA cash grant. To qualify for the grant, a project either must be placed in service in 2009 or 2010 or, if construction begins on or before December 31, 2010, must be placed in service by a specified credit termination date (December 31, 2012 for large wind projects; December 31, 2013 for biomass, certain geothermal and other projects; and December 31, 2016 for solar and other projects).  For the Stoel Rives Energy Tax Alert on the topic, click here

California and FERC Agreement to Coordinate Hydrokinetic Project Development

From our colleague Michael O'Connell:

On May 18, 2010, California and the Federal Energy Regulatory Commission (FERC) signed a Memorandum of Understanding (MOU) to coordinate federal and state procedures and schedules for development of hydrokinetic projects off California’s coast. FERC previously entered MOUs for such coordination with Oregon, Washington and Maine.

The California-FERC MOU provides that the parties will encourage developers to seek pilot project licenses prior to a full commercial license. The footprint and number of devices deployed in California waters for testing would be limited under pilot project licenses in order to minimize environmental risk. FERC’s 2008 hydrokinetic pilot project white paper provides that pilot licenses would be issued for five years in order to allow licensees to conduct device testing and monitoring in support of studies required by applications for longer-term licenses. The California-FERC MOU also provides for consultation with stakeholders on the design of studies and other environmental matters.

According to the MOU, permits, leases and licenses issued by California agencies will require technology performance reporting and study results together with safeguards to ensure that projects will not have significant adverse effects on environmental, economic or cultural resources. The MOU parties also agree to share information from project developers regarding their facility’s energy production and “if applicable, power purchase contracts awards, during a project’s licensing application process and/or license term; provided that dissemination of the information is not otherwise protected from disclosure.” These MOU provisions are likely to raise confidentiality concerns among developers. The MOU recognizes that FERC cannot issue a license for a hydrokinetic project within California marine waters unless certain concurrences are issued or waived that a project is consistent with California’s Coastal Management Program. Any license issued by FERC will include, to the maximum extent practicable, terms and conditions determined by California agencies to be necessary to avoid, minimize and mitigate damage to fish, wildlife, and public trust resources.

The California-FERC MOU confirms state support for development of wave energy projects that can play a significant role in meeting the California’s goal of producing 33 percent of its electricity from renewable energy by 2020.

Washington Revising its State Energy Strategy

The Washington State Department of Commerce (formerly the Department of Community, Trade and Economic Development or CTED) has announced that it is attempting to revise Washington’s comprehensive energy plan (the “State Energy Strategy”). 

The State Energy Strategy was last revised in 2003, and it does not serve current energy realities and forecasts. Therefore, the Washington State Legislature has tasked the Department of Commerce with updating the State Energy Strategy while taking account the following three goals and nine principles:

Continue Reading...

U.S. DOE Releases Funding Opportunity Announcement for Marine and Hydrokinetic Technology Development

Today, the U.S. Department of Energy (the "DOE") released the long-awaited Financial Assistance Funding Opportunity Announcement ("FOA") titled "Marine and Hydrokinetic Technology Readiness Advancement Initiative."  Federal funding for this initiative for fiscal year 2010 is expected to be up to $15.36 million, with the possibility of continued funding at, or near, that level for up to an additional two years.  (Because all federal funding is subject to annual appropriations, these figures should be treated as estimates.)

The DOE has recognized that marine hydrokinetic ("MHK") technologies can provide renewable, environmentally responsible, and predictable baseload electricity to load centers along the nation's coastlines.  And to help accelerate the development and deployment of these technologies, the DOE intends to advance the technological and operational readiness of MHK systems and components across a range of technology readiness levels ("TRLs") through this Funding Opportunity Announcement.

Although TRLs have been used for years by both NASA and the Department of Defense to develop advanced, mission-critical systems, this is the first time TRLs have been used by the DOE to assess the technological readiness of new renewable energy technologies.  Recognizing that MHK devices and components are still largely in the early stages of research and development, the DOE has adopted a simplified TRL structure for purposes of this Funding Opportunity Announcement.  The DOE is seeking applications in two topic areas: (1) MHK Technologies Concept Development (TRLs 1-3) and (2) MHK Technology Readiness Level Advancement (TRLs 4-9). 

Funding will be made available in each topic area for both "systems" and "components."  The DOE organized and grouped the TRLs into four discrete funding categories:

  1. Discovery / Concept Definition / Early Stage Development, Design and Engineering (TRL 1-3);
  2. Proof of Concept (TRL 4);
  3. System Integration and Technology Laboratory Demonstration (TRL 5/6); and
  4. Open Water System Testing, Demonstration, and Operation (TRL 7/8).

Each category has prescribed funding levels and project performance periods.  A brief summary of the expected number of awards in each topic area and the associated expected federal funding is included below.  For a complete funding breakdown for systems and components, see the Funding Opportunity Announcement.

Topic Area Summary

Topic Area Period of Performance Expected Number of Awards Total  Estimated Federal Funding Estimated FY 2010 Federal Funding

MHK Technologies Concept Development

(TRLs 1-3)

    12 months

           8 

  (4 systems, 4 components)

       $1.6M          $1.6M

MHK Technology Readiness Level Advancement

(TRLs 4-9)

  18-36 months

    (see FOA)

           18 

  (11 systems, 7 components)

      $36.72M        $13.76M

 

Applications are due to DOE by 11:59 PM Eastern Time on June 7, 2010.

REMINDER: Upcoming DOE Funding for Marine Hydrokinetics

On March 11, 2010, I posted a blog about the U.S. Department of Energy's (the "DOE") upcoming Funding Opportunity Announcement ("FOA") for hydrokinetic technology development.  The DOE issued a Notice of Intent announcing the FOA earlier that week.  To access the Notice of Intent, click here, and enter "hydrokinetic" in the search field. 

The DOE was expected to issue the FOA by March 31, 2010.  This blog is intended as a reminder that all interested parties should make sure they have followed the necessary steps to apply or submit questions regarding the FOA.  For official procedures, see the Notice of Intent.

To respond to FOAs, either as an applicant to to submit questions, parties must first be registered with FedConnect.  In order to register for FedConnect, a party must:

  • Have a Duns and Bradstreet Data Universal Numbering System (a "DUNS Number").  If you do not know your company's DUNS Number or if your company does not have one, you can search for it or request one here; and
  • Be registered with the Central Contractor Registry (the "CCR").  If you are not currently registered for the CCR, you can register at the CCR website.

If you are the first person to register in your company for FedConnect, you will need your company's CCR MPIN.  If your company is already registered with the CCR, then you can find out who has your CCR MPIN by going to the CCR website and clicking "Search CCR."  A company's CCR must be updated annually.  To update your company's CCR, visit the CCR renewal website.

NOTE:  CCR and FedConnect registration can take at least 21 days to complete.  Since the DOE is expecting a quick turnaround on the FOA once it is released, interested parties should begin the registration process as soon as possible.

Department of Energy, Department of the Interior, and Army Corps of Engineers Sign Memorandum of Understanding for Hydropower

On March 24, 2010, three federal agencies announced a Memorandum of Understanding for Hydropower (the “MOU”) that impacts developers of traditional hydropower, hydrokinetic, pumped storage, and small-scale hydropower facilities. The Department of Energy (“DOE”), the Department of the Interior (“DOI”), and the Department of the Army, through the U.S. Army Corps of Engineers (“USACE”) (collectively, the “Agencies”), signed the MOU to "meet the Nation’s needs for reliable, affordable, and environmentally sustainable hydropower by building a long-term working relationship, prioritizing similar goals, and aligning ongoing and future renewable energy development efforts" between the agencies. The MOU comes at a time when industry representatives and eleven U.S. Senators are requesting that DOE support a $200 million appropriations request for the advancement of both conventional and advanced waterpower technologies.

 In this “new approach to hydropower,” the Agencies intend to focus their collective efforts on advancing sustainable, low-impact, and small hydropower projects and promoting the goal of energy efficiency through water conservation or improved water management. Operating under the MOU, the Agencies will work together to advance four primary objectives:

  • Support the maintenance and sustainable optimization of existing Federal and non-Federal hydropower projects;
  • Elevate the goal of increased hydropower generation as a priority of each Agency to the extent permitted by their respective statutory authorities;
  •  Promote energy efficiency; and 
  • Ensure that new hydropower generation is implemented in a sustainable manner.

For more information on the MOU, including potential next steps for the Agencies, read the Energy Law Alert by Stoel Rives attorneys Cherise Oram, Michael O'Connell, and Chad Marriott posted here.

If you would like to sign up to receive our Energy Law Alerts when they are released, click here.

Tradable RECs Now Count Toward California's RPS

On Thursday March 11, 2010, the California Public Utility Commission (the "CPUC") created a market for tradable renewable energy credits ("TRECs") in the state.  That's big news.  In its 149-page decision, the CPUC stated that investor-owned utilities ("IOUs"), energy service providers, and community choice aggregators may now use TRECs to comply with California's ambitious renewable portfolio standard ("RPS").  These entities are now permitted to purchase a portion of their RPS compliance from generation sources other than those they own (e.g., distributed solar generation facilities within the state and certain out-of-state facilities).

 

Continue Reading...

National Hydropower Association Regional Meeting Underway in Juneau

Mary Jo Miller from our Portland office and Jonn Kauffman of our Anchorage office are in Juneau today and tomorrow attending the National Hydropower Association's Regional meeting, where Mary Jo is participating on a panel discussing funding mechanisms available for building hydropower projects. Mary Jo will present a case study describing the various loan, grant, and tax incentive funds used by one of our clients, the Central Oregon Irrigation District, to replace its existing porous open irrigation canal with an underground steel pipe combined with a 5MW hydropower system. The project will conserve water supply, increase river flow and water quality for local fish and wildlife species, and generate clean power for the local community. COID accessed eight different sources of funding to make this project a reality. Mary Jo's case study presentation is available here.

DOE Announces Upcoming Funding for Marine Hydrokinetics

Good news for marine hydrokinetics!  On Wednesday, the U.S. Department of Energy ( the "DOE") issued a Notice of Intent announcing that its Wind and Hydropower Technologies Program will publish a Funding Opportunity Announcement ("FOA") for hydrokinetic technology development no later than March 31, 2010.  This announcement comes just six months after the DOE awarded $14.6 million to 22 advanced water power projects designed to accelerate the commercial viability, market acceptance, and environmental performance of these technologies.  Stoel Rives would like to congratulate Pacific Energy Ventures and Ocean Power Technologies for receiving two of those awards.

The FOA, called the "Marine and Hydrokinetic Technology Readiness Advancement Initiative," will solicit applications from industry-led partnerships that want to develop marine and hydrokinetic ("MHK") technologies at all levels of industry maturity.  However, unlike past rounds of funding, this time the DOE will be using MHK-specific technology readiness levels ("TRLs") to assess system and component maturity.  Preliminary definitions for the nine different proposed TRLs are included in the Notice of Intent.  The DOE will direct funding in two areas using the new TRLs:

  1. Concept Development- Funding in this area will focus on projects seeking to advance a novel concept from TRL 1-3 ("Discovery/Concept Definition") to TRL 4 ("Proof of Concept").  By funding these projects, the DOE hopes to stimulate technology breaktroughs.
  2. Technology Readiness Level Advancement- Funding in this area will be directed to projects focused on operational readiness.  Recipients will have established a proof of concept already and are moving toward laboratory or test facility validation of scale models, open water tests, operational verification, and commercial application. 

Developers should begin assembling their teams immediately because the DOE anticipates a short application deadline once the FOA is announced.  Remember that each applicant must be registered with FedConnect; each must have a Dun and Bradstreet Data Universal Numbering System number (a "DUNS number"), and each must be registered with the Central Contractor Registry.

 

POSSIBLE RESTRUCTURING OF 1603 GRANTS

Congress is considering a complete rewrite of the 1603 grant program.  Some of the changes being considered are very helpful while others would be extremely troubling.  Please continue reading to get the full story ...

 

 

Continue Reading...

Stoel Rives Clients Receive Huge Tax Credit Awards

Stoel Rives would like to congratulate REC Silicon and SolarWorld on their awards of tax credits by the IRS and DOE. These two companies, combined, received over 10 percent of all the tax credits awarded nationwide under section 48C of the tax code.

On Friday, January 8, the Department of Energy awarded to 183 companies $2.3 billion in tax credits for projects designed to expand, re-equip or establish manufacturing facilities for the production of equipment used to produce renewable and other green energy. The $2.3 billion was the full amount authorized by Congress in the stimulus bill as part of new section 48C of the tax code.

Applications for the credit far exceeded the dollar amount of credits available. Stoel Rives is proud to have been directly involved with these companies in preparing the complex applications for the credit. REC Silicon received the largest award of any company -- $154.8 million. SolarWorld received the seventh largest award -- $82.2 million. These credits will provide these companies with a dollar-for-dollar offset against their federal income tax liability.

There is considerable discussion in Congress regarding adding additional funds to the section 48C program, which will permit another round of awards. Please contact your favorite Stoel Rives attorney if you have any questions about these awards or extension of the section 48C credit.

CPUC Proposed Decision on TRECs--Comments Due January 19

The California Public Utilities Commission ("CPUC") issued a proposed decision on December 23, 2009 that would, if adopted, allow California investor-owned utilities, energy service providers, and community choice aggregators to purchase renewable energy credits alone, without the associated energy (sometimes referred to as "unbundled renewable energy credits ("RECs)" or "tradable RECs"), to satisfy their obligations under California's RPS. California's largest investor-owned utilities—Pacific Gas and Electric, Southern California Edison, and San Diego Gas and Electric—would be limited to meeting no more than 40% of their annual procurement targets under the RPS with tradable RECs, and a price cap of $50 would be imposed. The CPUC will revisit both the percentage cap and the cost cap and whether those caps should be revised within 24 months of the decision.

Out-of-state renewable energy projects could be adversely impacted if the proposed order were adopted. The proposed decision would define all renewable generation purchased from out-of-state facilities1 as the purchase of unbundled or tradable RECs, making any out-of-state renewable energy sale subject to the cap that bars the large investor-owned utilities from using such sales to meet more than 40% of their overall RPS obligation. Although the proposed decision states that this classification would apply only to contracts signed on or after the effective date of the decision, contracts signed prior to the effective date would be considered REC-only contracts from the effective date forward, and would be "subject to the limits and rules applying to REC-only contracts" according to the proposed decision. Furthermore, although the purchase of tradable RECs from out-of-state facilities would be permitted, the delivery requirement in the RPS legislation would still have to be met, so a comparable amount of power would have to be imported into the state, along with the RECs. The jurisdiction to determine whether and how this delivery requirement is met, however, still remains with the California Energy Commission.

Comments on the proposed decision are due on January 19, 2010, and reply comments are due January 25, 2010.

For additional information about the history and effect of the proposed decision, see our Stoel Rives alert on the topic.

Zino Green Investment Forum

The ZINO Society, a Seattle-based angel investment group, announced last week that its annual “ZINO Green Investment Forum” would be held on March 4, 2010, at the McKinstry Innovation Center in Seattle.   Up to fifteen early-stage companies in “green tech, clean tech, and sustainable products or services” will be selected by the ZINO Green screening board to present their businesses to angel investors and business leaders attending the investment forum. Finalists will be selected to compete for a $50,000 award from ZINO’s investment fund.

Last year’s winner of ZINO Society’s $50,000 GreenFund award was Hydrovolts, the developer of a hydrokinetic turbine.  After winning the award last year, Burt Hamner, CEO of Hydrovolts, stated that “Our new technology makes it possible to generate renewable energy from fast water currents that could not be tapped before, using a really novel turbine design.  It’s a challenge to explain [our technology] quickly and the presentation, coaching and business model feedback we received from ZINO Society members was incredibly helpful.” Hydrovolts went on to win the  2009 Clean Tech Open National Sustainability Award.

Stoel Rives has been a proud sponsor of The Zino Society since its inception.

The application to apply to present at ZINO Green may be found at https://angelsoft.net/angel-group/zino-society. More information about the event is available at ZINO’s website http://www.zinosociety.com/calendar/1143/ or by contacting Rob Brown at r.brown@zinosociety.com or 206-621-0466.

Come Visit Us at E3, The Midwest's Premier Energy, Economic and Environmental Conference, on Nov. 17, 2009

As a proud Exhibit Hall sponsor of E3, the Midwest’s premier energy, economic and environmental conference, Stoel Rives LLP would like to encourage you to attend this annual event. Hosted by the University of Minnesota’s Initiative for Renewable Energy and the Environment, E3 will focus this year on the intersection of innovative technologies and policies, environmental benefits and emerging market opportunities across the renewable energy spectrum.

Stoel Rives attorneys Mark Hanson, Bill Holmes and Greg Jenner are part of the event faculty. Mark will moderate a panel presentation on the challenges and opportunities of converting carbon dioxide to fuels. Bill will moderate a panel discussing exactly how sophisticated smart power grids need to be in order to scale up renewables as a major U.S. energy contributor. Greg, meanwhile, will participate in a panel discussion on the most efficient and effective strategies for financing renewable energy projects.

 

For more information and to register, please visit the following link: http://bit.ly/XUUjJ. We hope to see you there, and encourage you to visit our booth (#24). In addition to our presenters, Debra Frimerman, Kevin Johnson, Kevin Prohaska, Katie Roek, Mary Sennes, Joe Thompson and Vicki Twogood will be available to discuss any questions you may have. Don’t forget to pick up complimentary copies of our Law of Series handbooks, including The Law of Solar, The Law of Wind, The Law of Biofuels, The Law of Building Green, Lava Law,and our most recent additions The Law of Algae and Show Me the Money: The Law of the Stimulus (2d ed).

Avista Seeks Additional Renewable Energy

Avista announced earlier this week that it is seeking proposals from suppliers of renewable energy.  Avista wants to acquire roughly 35 average megawatts (aMW) of long-term qualified renewable energy, to be supplied by the end of 2012 . The company is looking for proposals from wind, solar, geothermal, biomass, qualified hydroelectric and other renewable resources that meet Washington's RPS standard.

Avista plans to host a conference call for potential bidders on September 30. Responses to the  request for proposals are due by October 23, 2009. The full RFP and instructions for bidders can be found here

$13 Million Awarded from the Rural Energy for America Program

In an earlier blog, my colleagues, Debra Frimerman and Janet Jacobs reported about the Rural Energy for America Program (“REAP”), in general and specifically in regards to small wind projects.  REAP is a Department of Agriculture (“USDA”) program that provides grants and loan guarantees to agricultural producers and rural small businesses to purchase renewable energy systems, make energy efficiency improvements and conduct feasibility studies for renewable energy systems.  Eligible renewable energy systems include those that generate heat, electricity or fuels from wind, solar, biomass, geothermal, hydro power, and hydrogen based feed stocks.

The USDA has announced that it has awarded more than $13 million in REAP funds for 233 renewable energy projects in 38 states. Examples of the awards include a $1.8 million guaranteed loan and $500,000 grant for Milford Wind Energy, LLC; a $435,271 guaranteed loan and $435,271 grant for Unaka Forest Products, Inc.; and a $15,000 grant to Pacifica Marine, Inc.

 

 

Continue Reading...

November 17: Energy, Economics and Environment (E3) Conference

The University of Minnesota’s annual conference on Energy, Economics and the Environment – E3 – will be held in St. Paul on November 17. Hosted annually by the University of Minnesota’s Initiative for Renewable Energy and the Environment (IREE), this year’s conference will explore current technologies, environmental benefits and market opportunities in renewable energy.

Stoel Rives will be a sponsor of the E3 conference and will, as usual, host a booth at the event. Minneapolis tax partner Greg Jenner will join a panel to discuss “What’s the most efficient and effective strategy for financing renewable energy projects?” To review the agenda and register for the conference, click here.

Free Webinar on Loan Guarantee Program Hosted by DOE

The U.S. Department of Energy is hosting a free webinar on "How to Build a Strong Application" for the DOE Loan Guarantee Program on Tuesday, September 8, 2009 from 1:00 PM - 2:00 PM EST.  The webinar is intended to explain the loan guarantee program and help lenders and applicants navigate the application process.  DOE will also be providing suggestions on how to create a strong loan guarantee application

DOE recently released two solicitations under the program for innovative energy efficiency, renewable energy and advanced transmission and distribution technologies and transmission infrastructure investment projects.  DOE is particularly interested in wind, closed-loop biomass, open-loop biomass, geothermal, landfill gas, trash-to-energy, hydropower and solar projects that are able to commence construction before September 30, 2011. 

DOE will be hosting a series of free webinars on the application process over the next few months. 

First Treasury Grants in Lieu of ITC Awarded

Treasury Secretary Tim Geithner and Energy Secretary Steven Chu announced the first awards of cash grants in lieu of the investment tax credit (ITC) today.  The total award value was over $502 million.  Recipients include projects in Colorado, Connecticut, Maine, Minnesota, New York, Oregon, Pennsylvania and Texas.  Click here for a detailed list of the awards announced today.  Additional awards will be announced in the coming weeks. 

For more information on this program and the application process, please see the Stoel Rives Energy Law Alert:  Treasury Issues Guidance on Applications for Grants in Lieu of the ITC and PTC.

Australia passes 20% renewable energy target by 2020

From my colleague Adam Walters:

On August 20 the Australian government announced the passage of a bill quadrupling its Renewable Energy Target (RET) to ensure that 20% (approximately 45,000 GWh) of Australia’s electricity is generated from renewable energy sources by 2020.

 

How does Australia’s RET Scheme Work?

 

The RET scheme is an expansion of Australia’s Mandatory RET scheme introduced in 2001, the first of its kind in the world. It works through the creation and sale of Renewable Energy Certificates (RECs) by renewable power generators to “liable parties” (mainly large-scale electricity utilities and consumers), who must provide a designated quantity of REC’s to Australia’s renewable energy regulator to demonstrate compliance and avoid having to pay charges for any shortfall. One of the changes brought about the new legislation is to increase from $40/MWh to $65/MWh.

Renewable energy sources eligible for accreditation under the RET scheme include: solar, wind, hydro, tidal, wave, biomass and geothermal, as well as solar water heaters and other smaller generation units. Hydro has historically dominated Australia’s renewable energy landscape, but recent project announcements and funding opportunities for wind and solar projects signal greater diversification of the industry, particularly for proven technologies.        

Continue Reading...

Show me the Money: DOE Proposes Amendments to its Loan Guarantee Program

Today, the Department of Energy (DOE) issued a notice of proposed rulemaking to amend 10 CFR Part 609, the rule regulating the loan guarantee program authorized by section 1703 of Title XVII of the Energy Policy Act of 2005.  The two principal goals of section 1703 of Title XVII are to encourage commercial use of new or significantly improved energy-related technologies and to achieve substantial environmental benefits.  (See these recent alerts regarding the DOE loan guarantee program and the related application process)

After reexamining Title XVII, the DOE has concluded that the statute does not require a first lien on all project assets.  DOE has discovered that its current requirement that it be in lien position is in conflict with the financing structure of many energy projects.  For example, many utility scale power plants are jointly owned by public power agencies, cooperative power systems and investor-owned utilities.  In these cases, it may not be commercially feasible to obtain a lien on all project assets or the credit of a sponsor may be sufficient to support a more modest pledge of assets.

Furthermore, DOE has found that other parties are interested in participating as co-lenders, co-guarantors, or insurers of Title XVII loans.  However, these other parties expect to share, on a pari passu basis, in any collateral securing such loans.

Consequently, DOE proposes two amendments to the current rules:

  1. Delete the requirement of a first priority lien on all project assets and leave to the Secretary (of DOE) the determination of an appropriate collateral package, as well as intercreditor arrangements; and
  2. Allow the Secretary (of DOE) to determine if pari passu lending is in the best interests of the United States

 

Continue Reading...

$22 Million for Community Renewable Energy

The Department of Energy (DOE) announced this week that up to $22 million from the Recovery Act would be allotted to up to 4 eligible communities nationwide in order to encourage utility-scale renewable energy systems that provide clean, reliable, and affordable energy supplies for their communities, while creating jobs and new economic development opportunities. The projects will demonstrate how multiple renewable energy technologies, including solar, wind, biomass, and geothermal systems, can be deployed at scale to supply clean energy to communities.  Eligible applicants are local and state governments, Indian Tribes and Tribal Energy Resource Development Organizations or Groups.

Successful applicants will be awarded financial assistance to support the implementation of an integrated renewable energy deployment plan for a community, and the construction of renewable energy systems.  DOE expects each project to also have substantial private sector investment in addition to the funds from DOE.  Completed applications are due September 3, 2009 and the DOE will select awardees by the end of November 2009.

Show me the Money: Applications Available for the Washington State Energy Program

Washington previously received $60.9 million in Recovery Act funding for its State Energy Program (“SEP”). The Washington Legislature later provided $38.5 million to the Washington State Community, Trade and Economic Development (“CTED”) agency to administer a loan and grant program for eligible projects in the areas of energy efficiency, renewable energy and clean energy innovation (see our earlier blog entry here for more details). The deadline for submitting a notice of intent to apply is July 27, 2009 at 5:00 p.m. Pacific time, and the application is due August 17, 2009 at 5:00 p.m. Pacific time.

I attended an informational meeting held by CTED on July 13, 2009. The meeting provided an overview of the loan and grant program, as well as funding details, eligibility guidelines and evaluation criteria. Eligible projects can receive between $500,000 to $2 million in loans and grants in the first round, with the requirement that applicants provide other sources of funding at least equal to the amount of the loan or grant request. The non-SEP funding may include amounts spent or committed to the project since January 1, 2009. Projects will be evaluated based on the feasibility and quality of the project plan, the experience and qualifications of the project team, the ratio of matching funds to SEP funds, job creation, and energy savings/production. CTED intends to announce award decisions in September 2009.

Show me the Money: Applications Available now for Washington's State Energy Program

On July 1, 2009, Washington State’s Department of Community, Trade and Economic Development (“CTED”) issued application guidelines and forms for its State Energy Program (“SEP”) (available by clicking here). The American Recovery and Reinvestment Act of 2009 (the “Recovery Act”) provided $60.9 million in new funding for Washington’s SEP. Subsequently, the Washington Legislature allocated $38.5 million to CTED to administer a loan and grant program for energy efficiency and renewable energy program (see our client alert, available here, regarding the legislative action). 

Continue Reading...

Stoel Rives Expands Its San Diego Office

 

We welcome energy attorneys Morten Lund and David Quinby to the firm’s San Diego office as members of the Energy and Telecommunications group. They join attorneys Howard Susman and Brian Nese. The San Diego office has relocated to a larger space at 12265 El Camino Real, Suite 303, to accommodate further expansion (new contact information below).

http://www.stoel.com/images/photos/Lund-M.jpg

Morten Lund, formerly a partner with Foley & Lardner LLP in Milwaukee, has experience in a broad variety of financing transactions, with particular focus on the development and financing of wind and solar energy projects. Morten is a frequent presenter and author on renewable energy topics. He earned his law degree from Yale University in 1995 and obtained his A.B. at Augustana College in 1992. He is admitted to practice law in the state of Wisconsin and is pending bar admission to the state of California.

_____________________________________________

http://www.stoel.com/images/photos/Quinby-D.jpg

David Quinby is the current office managing partner of the firm’s Minneapolis office, and will now split his practice between California and Minneapolis. He concentrates his practice on corporate, securities, finance, and merger and acquisition matters, with a particular focus on renewable energy clients and their project development efforts. David is admitted to practice law in the state of Minnesota and is pending bar admission to the state of California.

The California energy team's capabilities also include real estate, land use and permitting, equipment procurement and construction, state and federal regulation, environmental matters, and dispute resolution.

Stoel Rives has received a national ranking for its Renewables and Alternative Energy practice from Chambers USA: America's Leading Lawyers for Business (2009), rating among the top law firms in this category. The firm has been at the forefront of growth in renewables in recent years and represents many of the industry leaders in solar, wind energy, geothermal, biomass, hydroelectric, ocean, combined-cycle natural gas, carbon sequestration and biofuels project development in California, the United States, Canada and abroad.

For more information about the Stoel Rives Renewable Energy Group, visit www.stoel.com/renewableenergy or contact:

Howard Susman at  (8... or hesusman@stoel.com
David Quinby at  (8... or dtquinby@stoel.com
Morten Lund at  (8... or malund@stoel.com
Brian Nese at  (8... or bjnese@stoel.com

 

Show me the Money: Florida, Idaho, and Kansas State Energy Programs Received $77.1 Million from the Recovery Act

On June 24, 2009, the Department of Energy (“DOE”) announced more than $204 million in Recovery Act funding to ten states for their State Energy Programs ("SEPs"). 

Here is a summary of how the monies will be used in Florida, Idaho, and Kansas:

Florida's SEP will fund energy efficiency, renewable energy, and alternative fuels projects in the state.  Florida will deploy these funds through several loan and grant programs to promote the commercialization of new clean technologies.  Florida was awarded $50.4 million, and will receive an additional $63 million after demonstrating successful implementation of its SEP.

Idaho's SEP will launch a set up new programs, including the Renewable Energy Business Development Program, to further renewable energy development in the state while creating new jobs and stimulating the economy.  Further, new zoning regulations will be created to attract renewable energy developers and projects.  Idaho received $11.4 million and will receive more than $14 million in additional funding after demonstrating successful implementation of its SEP.

Kansas's SEP will launch several initiatives to boost energy efficiency in commercial buildings, increase financial options for renewable energy, and increase cost savings for individual homeowners in its state.  A portion of the money will also be deployed to create a new utility rate price plan and to fund an energy audit rebate plan.  Kansas received $15.3 million and expects to receive an additional $19 million after demonstrating successful implementation of its SEP.

 My colleagues are blogging on the other states that received funds. 

Labor Unions Target Renewable Energy Development

My partner Dennis Westlind recently posted this article to our sister blog, the Labor & Employment Group's  World of Work:

Labor unions are seeing a rare growth opportunity in green power.  Despite the recession, there has been a building boom in green energy, in particular solar and wind projects.  As reported recently in the New York Times, labor unions see something in green energy for them as well, and they're using intense political pressure to get it.

When a new solar or wind project is being built, a union will approach the builder and demand that it use only union labor on the project.  If the builder agrees, the union then urges local regulators to quickly approve the project; if the builder refuses, however, the union then raises myriad environmental concerns with regulators in an attempt to stall or even completely derail the project.  Apparently, a union-built solar installation won't have the same impact on the habitat of the short-nosed kangaroo rat or the ferruginous hawk as a non-union one.  Right. 

These tactics aren't new; labor unions have made aggressive use of the environmental laws for years to put pressure on traditional energy producers to use union labor.  But, with union membership in an overall decline, unions are desperate to maintain relevance in the growing green economy. 

Show me the Money: Conneticut and Utah State Energy Programs

Today, the Department of Energy (“DOE”) announced more than $204 million in Recovery Act funding to ten states for their State Energy Programs ("SEPs"). 

Here is a summary of how the monies will be used in Connecticut and Utah:

Connecticut will use its SEP funding to further a variety of programs. Examples include the deployment of alternative-fuel vehicles and in-home energy audits. In-home energy audits involve a specialist performing an energy assessment, weatherizing the home, and installing energy conservation devices. After demonstrating successful implementation of its plan, the state will receive an additional $19 million, for a total of $38 million.

Utah will use its SEP funding to collect data about potential renewable energy resources in the state and to improve energy efficiency. The energy efficiency program will provide financial incentives to upgrade residential, commercial, public education, and government buildings. New construction developments will also qualify for rebates if they meet specific energy efficiency goals. After demonstrating successful implementation of its plan, the state will receive an additional $17 million, for a total of $35 million.

My colleagues are blogging on the other 8 states that received funds today. 

 

Show me the Money: Seminar for Identifying Funding for Renewable Energy Projects

The American Recovery and Reinvestment Act provides almost $94 billion dollars in direct and indirect spending to clean energy company and projects. See Show me the Money: A Guide to Sources of Funding through the American Recovery and Reinvestment Act

On June 17, 2009, I will be speaking in Cle Elum, Washington about how to get your project "shovel ready" for Stimulus Funding.  The seminar will also include sessions on identifying sources of funding and application mechanics.

Please click here for event information

FERC and Washington Sign MOU on Hydrokinetic Projects

Late last week, the Federal Energy Regulatory Commission (“FERC”) and the State of Washington signed a Memorandum of Understanding (“MOU”) to coordinate their review of hydrokinetic energy projects in Washington state waters.  The MOU is intended to  reduce some of the regulatory barriers associated with siting and permitting such projects, while also ensuring that projects are undertaken in an environmentally and culturally sensitive manner. 

As described in the MOU, FERC and Washington have pledged to collaborate in the following ways:  (1) notifying each other of potential applicants for a preliminary permit, pilot project license, or license; (2) agreeing upon a schedule for processing license applications that will include milestones and encourage collaboration among various stakeholders; (3) coordinating the environmental reviews of projects proposed in Washington state waters and consulting with stakeholders on the design of applicable studies; and (4) agreeing that if Washington prepares a comprehensive plan with respect to the siting of hydrokinetic projects, in determining whether to approve a project license, FERC will consider whether the project is consistent with the state plan.  Notably, the MOU recognizes that Washington may submit an amendment to its coastal zone management plan to the National Oceanic and Atmospheric Administration (“NOAA”) for approval, and that such a plan may identify a limited number of areas within Washington state waters where hydrokinetic projects may be initially located.  Whether NOAA would approve such a plan is unclear. 

LLC Law Monitor

Renewable energy developers often use limited liability companies (LLCs) as project companies and to form entities for other purposes.  My partner Doug Batey has started a new law blog that will likely be helpful to those charged with setting up, understand and maintaining these LLCs.  Here's today's announcement: 

Stoel Rives LLP is pleased to introduce its new LLC law blog, LLC Law Monitor, at www.llclawmonitor.com

The LLC Law Monitor focuses on the rapidly developing laws affecting limited liability companies. LLCs are a popular form of business entity and are a relatively new development in the law. LLC statutes vary from state to state, and cases of first impression are being decided by state courts every month.

In light of this new and evolving legal environment, Stoel Rives has launched LLC Law Monitor to provide business executives, attorneys, accountants and other professionals engaged in or working with LLCs with timely updates and insights on the new and developing laws shaping this burgeoning business sector.

LLC Law Monitorauthor Douglas L. Batey has nearly 30 years of experience advising executives on corporate and business legal matters. His experience includes counseling clients in a wide range of industries on company formation, mergers and acquisitions, and general corporate governance matters.

We hope that you will find the LLC Law Monitor helpful.

http://www.stoel.com/images/photos/batey.gif

Douglas L. Batey
Stoel Rives Corporate Attorney

Apply Now for REAP Grants and Loan Guarantees

The USDA announced today that it is accepting applications under the Rural Energy for America Program (“REAP”).  REAP provides grants and loan guarantees to agricultural producers and rural small businesses to purchase renewable energy systems, make energy efficiency improvements and conduct feasibility studies for renewable energy systems.

REAP funds are available in the following amounts:

  • Grants for energy efficiency projects are available for up to the lesser of $250,000 or 25% of the project costs.
  • Grants for renewable energy systems are available for up to the lesser of $500,000 or 25% of the project costs.
  • Grants for feasibility studies for renewable energy systems are available for up to the lesser of $50,000 or 50% of the costs of the study.
  • Loan guarantees are available for up to the lesser of $25 million or 75% of the project costs. 

Applicants must be agricultural producers or rural small businesses.  Agricultural producers are farmers or ranchers that obtain more than half of their gross income from agricultural operations.  Small rural businesses are small businesses, as determined in accordance with the Small Business Administration's small business size standards, located in rural areas.  Applications are due July 31, 2009.

"Show Me The Money"

 

We announce the publication of a guide to federal clean energy funding opportunities under the $787 billion American Recovery and Reinvestment Act (“ARRA”). Titled “Show Me The Money,” the guide reviews the various programs and potential sources of federal funding for clean energy companies and projects. The guide addresses funding opportunities under the ARRA for each of the following energy industry areas: wind, solar, biofuels, biomass, smart grid, transmission, geothermal, marine and hydrokinetic, green building, energy efficiency, advanced battery and fuel cell technology, clean energy equipment manufacturing, green vehicles and clean coal. The guide also contains information about some of the funding opportunities and updates at the federal and state level which we will continue to track closely.

President Obama Clamps Down on Lobbyists and First Amendment

On March 20th, President Obama issued a directive to the heads of executive branch departments and agencies.  The directive is aimed at achieving the laudable goal of ensuring merit based decision-making for grants and other forms of stimulus funds provided by the American Recovery and Reinvestment Act of 2009 (usually referred to as the Stimulus Bill).  It seems that while candidate Obama promised repeatedly during his campaign to limit the influence of lobbyists in Washington DC, the passage of the Stimulus Bill has sent record numbers of lobbyists to D.C. to scramble for federal dollars.

In apparent response to this, President Obama has singled out registered lobbyists and regulated their contacts with the executive branch.  His directive provides that “executive department or agency officials shall not consider the view of a lobbyist registered under the Lobbying Disclosure Act of 1995, concerning particular projects, applications, or applicants for funding under the Recovery Act unless such views are in writing.”  Officials are directed to inquire regarding the possible presence of registered lobbyists both upon the scheduling and commencement of phone calls and in-person conversations “with any person or entity concerning particular projects, applications, or applicants for funding under the Recovery Act.”  If any registered lobbyists are detected, the directive forbids them from attending the meeting or participating in the phone call.

Not surprisingly, the American League of Lobbyists (ALL) has objected to the Obama Administrations restrictions.  In a demonstration that politics does indeed sometimes make strange bedfellow, ALL has been joined by the ACLU and the Citizens for Responsibility and Ethics in Washington (CREW).  In a letter to the President released Tuesday, these three groups requested that President Obama rescind the constitutionally offensive provisions of the directive immediately.   

As tempting a political target as they may be, registered lobbyists have a place in our political system and rights under our Constitution.  The President should heed the groups’ advice and tailor his directive to enable transparency while not muzzling any voices--including those paid to advocate.

Stoel Teams with EUCI to Present Law of Renewable Energy Webinars

Stoel Rives LLP is teaming up with EUCI to present a series of webinar’s based on our series of “Law of” books about renewable energy. The Law of Renewable Energy web conferences will address the major legal issues associated with the development of renewable energy projects.  The web conferences will include the following topics:

Tax and Project Finance Structuring Issues for Renewable Energy Projects
April 27, 2009

Real Estate and Site Rights for Renewable Energy Projects
May 11, 2009

PPAs for Renewable Energy Projects
May 18, 2009

Siting and Permitting for Renewable Energy Projects
June 1, 2009

EPC, Major Component, Construction and Balance of Plant Contracts for Renewable Energy Projects
June 8, 2009

Regulatory and Transmission Issues for Renewable Energy Projects
June 15, 2009


Please sign up here if you’d like to get your own copy of any book in our “Law of” series. We update the “Law of” books regularly, and we'll have copies of the Law of Wind (5th edition) at Booth No. 3148 at the AWEA conference in Chicago on May 4-7, 2009. In addition, please sign up here if you’d like to receive our Stoel Rives Energy Law Alerts and other periodic updates.
 

Interior and FERC reach agreement on Outer Continental Shelf hydrokinetic projects; Secretary Salazar announces regional meeting details

From our colleague Cherise Oram:

Secretary of Interior (DOI) Ken Salazar and Acting Chairman of the Federal Energy Regulatory Commission (FERC) Jon Wellinghoff have announced an agreement describing how the two agencies will work together to facilitate permitting renewable energy – particularly ocean wave and current projects – on the outer continental shelf (OCS). The announcement indicates that DOI’s Minerals Management Service (MMS) will retain leasing authority for ocean wave and current projects on the OCS, but that FERC will have the “primary responsibility to manage the licensing of such projects” pursuant to the Federal Power Act (FPA) hydropower licensing provisions. FERC has long asserted that the FPA gives it concurrent jurisdiction with MMS’s leasing authority. The announcement indicates that the agencies will sign a more detailed Memorandum of Understanding describing how the agencies will coordinating their licensing and leasing processes for offshore projects.

This announcement comes just as Secretary Salazar, FERC Commissioner Philip Moeller and others were to testify before the Senate Committee on Energy and Natural Resources on offshore renewable energy, including the jurisdictional debate between MMS and FERC.

Finally, Secretary Salazar has announced more detailed information on the four regional offshore renewable energy meetings he plans to hold April 6-16 in Atlantic City, New Orleans, Anchorage and San Francisco. For detailed information, see Secretary Salazar’s Invitation to Regional Meetings on Offshore Energy Development.
 

The Shape of Waves to Come: Forecasting the Future of Ocean Power Conference (Portland, OR, February 10-11, 2009)

Those who follow the ocean energy industry are confronted with a fascinating array of technologies, ranging from articulated "sea snakes" to anchored buoys that exploit oscillating water columns to underwater turbines and other cutting edge technologies.  Ocean energy offers enormous possibilities, with the World Energy Council estimating that waves alone (to say nothing of tides, currents or ocean thermal energy) could provide anywhere from 1,000 to 10,000 gigawatts of capacity.  The Bay of Fundy in eastern Canada has tides so dramatic that it could in theory generate 17,000 GWh per year; some estimates suggests that tidal energy could produce as much as 1 million GWh per year, about 5 percent of today's worldwide electricity generation.  (For an excellent overview of the potential of various renewable energy sources, see NewScientist's October 11-17, 2008 special issue on renewable energy.)  The Obama Administration will make renewable energy a high priority, and ocean energy will benefit from that policy emphasis.

Along with the promise, ocean energy faces some unique challenges.  For example, wave height and frequency vary significantly depending on geography and weather, and deployed technologies need to be tailored to the environment in which they will operate.   Ocean technology must also cope with the power of the sea itself, including storms and freak waves.  On top of the technical challenges, ocean energy faces legal hurdles.  The California Public Utility Commission (CPUC) recently disapproved of a proposed 2MW wave energy power purchase agreement between Finavera and Pacific Gas & Electric, ruling that that the technology involved was not sufficiently reliable and that the cost of energy was too high.  (For details of the CPUC's decision and a link to the decision itself, see our Energy Law Alert entitled "California Public Utilities Commission Rejects Finavera-PG&E Wave Energy Contract ." ) The process of permitting and interconnecting an ocean energy facility will require the development of a  strategy that threads the needle among stakeholders and conflicting state and federal regulations and claims of jurisdiction.

For those interested in learning more about ocean energy and how to make it a reality, Greentech Media will be holding a Forecasting the Future of Ocean Power conference in Portland, Oregon, on February 10-11, 2009.  The conference will bring together analysts, investors, technology developers and suppliers, policy makers, and legal experts for a comprehensive look at the emerging ocean power industry. Stoel Rives is a sponsor for the event, which will also draw on research from Greentech Media's leading ocean power market analysis.

California PUC Moves to Allow Unbundled RECs

 

The California Public Utility Commission issued a draft decision on October 29th authorizing the use of unbundled and tradable renewable energy certificates (“RECs” or “TRECs”) for compliance with California’s RPS. 

Continue Reading...

Congress Extends PTC and ITC--More Analysis to Follow

In an email alert that we just sent out, my colleagues in the Stoel Rives Tax Section report:

Today the House passed, and President Bush signed into law, H.R. 1424, which includes the Energy Improvement and Extension Act of 2008 (the Act). The Act contains the much-anticipated extension of the production tax credit (PTC) and investment tax credit (ITC) sunset dates.

The Act extends the PTC placed-in-service sunset date for certain wind and refined coal facilities until December 31, 2009, and extends the PTC placed-in-service sunset date for certain other qualifying facilities until December 31, 2010. The Act also expands the PTC to include certain marine and hydrokinetic renewable energy facilities placed in service on or before December 31, 2011.

The Act extends the ITC placed-in-service sunset date for solar, fuel cell and microturbine property until December 31, 2016 and expands the ITC to include combined heat and power system property, qualified small wind energy property, and geothermal heat pump system property.

In addition, H.R. 1424 contains a variety of other renewable energy tax provisions, including provisions allowing the energy credit to offset alternative minimum tax liability; increasing the amount of the biodiesel and renewable diesel fuel credits and extending the sunset dates until December 31, 2009; authorizing new clean renewable energy bonds and qualified energy conservation bonds; and extending the energy efficient commercial buildings deduction and the new energy efficient home credit.

Our Tax Section is working on preparing a more detailed analysis of the tax aspects of HR 1424.  If you'd like to receive updates concerning H.R. 1424 and other renewable energy and clean tech issues, please subscribe to our Renewable Energy Mailing List.

 

Ocean Energy Makes Waves Again

For those who are following the development of ocean and wave energy on the West Coast of the United States and Canada, The Oregonian published an interesting article by Gail Kinsey-Hill entitled Off Oregon's Coast, Wave Energy Makes a SplashThe article provides a good overview of the latest Oregon developments in ocean and wave energy, describing the big payoffs, the challenges, the concerns of crabbers and fishermen, and the competing technologies (including Ocean Power Technologies' buoy-like "point absorbers" and Pelamis' sausage-like sea snake).

As The Oregonian's article suggests, those interested in learning more about cutting edge ocean technology should consider attending Oregon's Third Annual Ocean Renewable Energy Conference at the Mill Convention Center in Coos Bay.  The two day conference will be held this Thursday and Friday (September 25-26).  The event is hosted by Oregon Wave Energy Trust, and you can learn more about the conference and register for it at oregonwave.org

My partner Cherise Oram, one of the nation's leading legal experts on ocean, tidal and other forms of hydrokinetic energy, will be speaking on a panel discussing how wave projects are developed from concept to commercialization.  She'll have on hand plenty of complimentary copies of the new second edition of Stoel Rives' Law of Ocean and Tidal Energy , or you can download your own today.

Comments on 500+ Page MMS Rule Due September 8

On July 9, 2008, the Department of the Interior's Minerals Management Service (MMS) issued proposed regulations for granting leases, easements and rights of way for alternative energy project activities and for alternative uses of existing facilities located on the Outer Continental Shelf (OCS). For those who are less than excited at the prospect of wading through the 500+ page text of the proposed rules, my partner Cherise Oram and summer associate Chad Marriott (University of Oregon) have written an executive summary of the MMS's Proposed Regulations Governing Development of Wind, Wave, Current, Solar and Other Alternative Energy Sources on the Outer Continental Shelf. Comments on the proposed rules must be submitted to MMS no later than Monday, Spetember 8, 2008.