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In the recently issued but unpublished decision Reed v. SunRun, Inc. (Los Angeles County Super. Ct. No. BC498002, Feb. 2, 2018), the Second District Court of Appeal ruled that a solar power purchase agreement (“PPA”) provider that only sells solar energy to homeowners is not required to be a licensed California contractor under certain…

On December 1, 2017, two of the three major California investor-owned utilities (“IOUs”), Pacific Gas & Electricity (“PG&E”) and Southern California Edison (“SCE”), submitted applications for approval of the results of their 2016-2017 energy storage request for offers.

Background on the Energy Storage Mandate in California

In September 2010,…

For the first time in almost 30 years, the Michigan Public Service Commission (MPSC) is overhauling its implementation of PURPA. The last time the MPSC evaluated Consumers Energy Company’s (Consumers) avoided cost methodology, the Midcontinent Independent System Operator (MISO) had not been created and the generation market was vastly different than it is today. The…

Introduction

On October 4, 2017, the Governors of a number of western states signed a memorandum of understanding (“MOU”) to lay the foundation for work on a regional electric vehicle (“EV”) infrastructure development plan called the Regional Electric Vehicle Plan for the West (“REV West Plan”). The MOU was initially entered by Colorado, Utah, Nevada, Montana, Wyoming, Idaho and New Mexico, and later Arizona. [1]  The MOU calls for the participating states to work cooperatively to establish policies that will support the development of EV charging stations along 11 major transportation corridors that link their states together, spanning a total of 5,000 miles.[2] The MOU mainly focuses on interstate highway infrastructure including East-West Interstate 10, 40, 70 76, 80, 84, 86, 90, 94 and North-South Interstates 15 and 25.

The signatories to the MOU anticipate a future with much higher levels of EV usage. To support this greater EV usage, the MOU calls for efforts by the states to:

  1. Coordinate station locations, thereby maximizing use and minimizing inconsistency across charging station infrastructure;
  2. Develop practices and procedures that will encourage more people to adopt EVs, including addressing “range anxiety”;
  3. Develop operating standards for charging station uniformity;
  4. Explore ways to incorporate EV charging stations in the planning and development processes;
  5. Encourage automakers to stock a variety of EVs in participating states; and
  6. Collaborate on funding and finding opportunities for the network.[3]

Continue Reading The Western States’ Plan for EV Charging Infrastructure – Lessons Learned and Things to Watch

Stoel Rives’ Energy Team has been monitoring and providing summaries of key energy-related bills introduced by California legislators since the beginning of the 2017-2018 Legislative Session. Legislators have been busy moving bills through the legislative process since reconvening from the Summer Recess. For any bill not identified as a two-year bill, the deadline for each house to pass the bill and present it to the Governor for signature or veto was September 15, 2017. Below is a summary and status of bills we have been following.

An enrolled bill is one that has been through the proof-reading process and is sent to the Governor to take action. A two-year bill is a bill taken out of consideration during the first year of a regular legislative session, with the intent of taking it up again during the second half of the session.

  • Of particular note here is SB 100, California’s pitch for 100 percent renewable energy, failed to move to the next stage of the process and is kicked to next year.
  • Our next blog post, after October 15, will provide an update on whether those bills sent to Governor Brown were signed or vetoed.

Continue Reading Updates to Energy Related Bills in the 2017-2018 California Legislative Session

On July 25, 2017, California Governor Jerry Brown signed legislation extending the state’s cap-and-trade program through 2030. The signing ceremony for Assembly Bill (AB) 398 included former California Governor Arnold Schwarzenegger, who signed the first state statute authorizing cap-and-trade in 2006, AB 32.  The ceremony cemented the deal that Governor Brown struck with California lawmakers, passing AB 398 with bi-partisan support and a two-thirds majority of the Legislature.  In contrast to the passage of Senate Bill 32 in 2016, which extended California’s greenhouse gas reduction (GHG) targets through 2030 with the enactment of one simple sentence into statute, AB 398 stretched for pages.  AB 398 provided many details to be incorporated into the cap-and-trade regulation by the California Air Resources Board (ARB), the agency in charge of implementing cap-and-trade, and laid out requirements to mitigate the impacts of GHG regulation on regulated industry and increase in-state benefits.

Among the more note-worthy provisions of AB 398 were (1) a price ceiling on cap-and-trade allowances, (2) limitations on the use of offsets, particularly from out-of-state projects, and (3) a continuation of previous allowance allocations to vulnerable industries. ARB will also report to the Legislature by the end of 2025 on statutory changes needed to reduce leakage, including a potential border carbon adjustment.  Outside of the cap-and-trade regulation itself, the bill provides support to regulated entities with relief from sales and use taxes and prohibits local air districts from enacting additional GHG emissions reduction requirements.

In crafting the AB 398 deal, proponents of the bill wisely secured the votes necessary to pass the bill with a two-thirds majority and avoid the question whether cap-and-trade auctions post-2020 would be an unlawful tax under Proposition 26. The most recent cap-and-trade litigation in California Chamber of Commerce v. ARB and Morning Star Packing Co. v. ARB avoided this question, given that the original statute authorizing cap-and-trade, AB 32, was passed before Proposition 26 was voted in.  Proponents also secured support from sources as disparate as the California Chamber of Commerce, California Manufacturers and Technology Association, Natural Resources Defense Council, and Environmental Defense Fund.  Nevertheless, I would not rule out further judicial tangles on the implementation of AB 398 with amendments to the cap-and-trade regulation.
Continue Reading California Extends Cap-and-Trade Through 2030

Today, the MN PUC concluded a nearly four-year effort on updating environmental costs established under section 216B.2422 subd. 3 of the Minnesota Statutes.  Before getting to the decision, a bit of context.

Background:

Under section 216B.2422, the MN PUC is required to, “to the extent practicable, quantify and establish a range of environmental costs…

On July 14, 2017, and several weeks after the Second Circuit rejected challenges to Connecticut’s renewable energy procurement process and renewable energy credit program (see Allco Fin. Ltd. v. Robert J. Klee (Docket Nos. 16-2946, 16-2949)), the U.S. District Court for the Northern District of Illinois dismissed challenges brought by independent power producers and customers against Illinois’ nuclear subsidy program (Village of Old Mill Creek v. Anthony M. Star, Docket Nos. 17 CV 1163, 17 CV 1164). This Illinois decision further support the authority of states to promote generation of their choosing and represents another narrow reading of the Supreme Court’s recent ruling in Hughes v. Talen Energy (136 S. Ct. 1288 (2016)).

In the state program at issue in Old Mill Creek, Illinois created a “zero emission credit” (ZEC), a tradeable credit (modeled after a renewable energy credit) which represents the environmental attributes of one megawatt hour of energy from specified zero emission facilities (in this case, selected nuclear power plants interconnected with the Midcontinent Independent System Operator (MISO) or PJM Interconnection (PJM)). The effective purpose of this program is to subsidize Exelon’s Clinton and Quad Cities nuclear facilities in Illinois, which Exelon had threatened to shut down if it did not receive government support.
Continue Reading Another Court Upholds a State Generation Program and Dismisses Challenges to Illinois’ Nuclear Subsidies

Yesterday the California Supreme Court denied a petition for review of the cap-and-trade lawsuits brought by a coalition of business interests, headed by the California Chamber of Commerce and Morning Star Packing Company. The Court of Appeal decision issued in April 2017, which upheld the legality of California’s cap-and-trade auctions in the related cases California…

Stoel Rives’ Energy Team has been monitoring and providing summaries of key energy-related bills introduced by California legislators since the beginning of the 2017-2018 Legislative Session. June 2, 2017 was the deadline by which the legislature was required to pass bills out of the house of origin.  Failing to meet that deadline does not automatically prevent a bill from proceeding through the legislative process; however, such failure will prevent the bill from being considered by the full legislature or the Governor during the first half of the Legislative Session.  Below is a summary of bills we have been following that have most recently changed.  We will continue to monitor and update these energy-related bills as the legislative session proceeds.

Assembly Bills

AB 79 (Levine, D): Electrical generation: hourly greenhouse gas emissions: electricity from unspecified sources.
STATUS: Ordered to Senate June 1, 2017.

  • Initially introduced as a bill to decrease the amount energy consumed from coal-fired generation resources, AB 79 was revamped to require, by January 1, 2019, the State Air Resources Board (CARB), in consultation with the Independent System Operator (ISO), to regularly update its methodology for the calculation of emissions of greenhouse gases associated with electricity from unspecified sources. The bill would require the CPUC and the CEC to incorporate the methodology into programs addressing the disclosure of the emissions of greenhouse gases and the procurement of electricity by entities under the respective jurisdiction of each.

Continue Reading Updates to Energy Related Bills in the 2017-2018 California Legislative Session