The panel comprised corporate partner Andrew Brady; energy regulation, markets and enforcement partner Chip Cannon and senior counsel Jeff Dennis; oil and gas associate Paul V. Monsour; international trade partner Wynn Segall; public law and policy partner Jamie Tucker; and global projects finance partner Ed Zaelke. The program was moderated by Chris LaFollette, a partner in Akin Gump’s oil and gas practice and partner in charge of the Houston office.
The program began with Tucker outlining the various pieces of energy legislation that were enacted in 2015. It covered the areas of crude exports, tax credits for renewable energy, energy security, energy efficiency standards and the creation of a new Federal Permitting Improvement Council to identify best practices and deadlines for required reviews and approvals of various types of infrastructure projects.
Tucker then briefly discussed the legislative outlook for 2016, noting pending legislation includes the North American Energy Security and Infrastructure Act and the Energy Policy Modernization Act. There is also a bill focused on pipeline safety. Finally, Tucker talked about other initiatives of the Obama administration in its last year, such as the Clean Power Act, a new rule on methane and the Paris climate agreement.
Cannon and Dennis talked about key trends in the electric power sector in 2016. In a discussion of the EPA’s Clean Power Plan (CPP), they noted that carbon pollution standards for new and existing fossil fuel-fired power plants were finalized last August. Key decisions on the future of the CPP are expected this year, which, they said, will have significant implications for future energy infrastructure development and power markets.
Cannon and Dennis also gave an update on litigation involving the CPP. Numerous states, utilities, generators, manufacturers and others, they said, have sought judicial review of the existing plant standards. There was talk about state compliance planning with the CPP, what the Supreme Court may do regarding the ability of states to encourage investment in electric generation and a brief overview of a case on FERC’s demand response policies. The outcome will affect wholesale power prices.
Brady and Monsour talked about hot topics for energy companies as we approach proxy season. This included say-on-pay, shareholder proposals, shareholder activism and board composition. They discussed the filing review process and provided some examples of recent comment topics by the SEC. They also outlined several recent areas of SEC rulemaking under “Dodd-Frank.”
Segall gave a forecast for the year ahead with regard to Iran sanctions and their impact on the energy sector. He provided a timeline for when certain nuclear-related sanctions would be terminated and outlined those sanctions that are likely to remain in place.
Finally, Zaelke gave an update on the renewable energy sector. He discussed some of the top headlines of 2015, which included yieldcos driving down the cost of capital and pushing up prices for renewable projects, non-utility buyers of renewable power playing a significant role in the market, and California increasing its renewable portfolio standard from 33 percent to 50 percent by 2030. There was also, Zaelke noted, the extension of the solar investment tax credit and wind production tax credit.
Looking ahead, Zaelke predicted that the Clean Power Plan will continue to fuel the growth of renewable power in the United States. He also expects that the non-traditional purchaser of renewable power will continue to rise and that yieldcos will survive and grow, but with limited appetite for project acquisition from third-party developers. Finally, Zaelke sees an accelerated growth in wind energy development and expects solar power installations to increase dramatically.
A copy of the presentation is available here.
Founded in 1945, Akin Gump Strauss Hauer & Feld LLP is a leading international law firm with more than 900 lawyers in offices throughout the United States, Europe, Asia and the Middle East.
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