On August 28, 2017, the Federal Energy Regulatory Commission (FERC or the “Commission”) approved a Stipulation and Consent Agreement between FERC’s Office of Enforcement (OE) and American Transmission Company, LLC (ATC) to resolve an OE investigation of numerous violations by ATC of Sections 203 and 205 of the Federal Power Act (FPA). ATC identified the violations during an internal compliance review precipitated by a March 2014 settlement between OE and certain subsidiaries of ITC Holdings Corp. regarding similar violations, as described here.
On August 21, 2017, Power Africa published its 2017 Annual Report highlighting more than 80 Power Africa transactions closed and more than $14.5 billion in financings since its inception. Overall, it has facilitated the financial close of power transactions expected to generate more than 7,200 MW of power in sub-Saharan Africa and generated more than $500 million in U.S. exports. The report demonstrates how Power Africa, and the recently passed Electrify Africa Act, continues to create opportunities for American businesses in Africa as it proceeds toward its goals of increasing installed generation capacity by 30,000 MW and adding 60 million new electricity connections by 2030 on the continent. These developments are important, since interested investors continue to seek access to the $300 billion energy market in sub-Saharan Africa and tap into the demand for an additional 20,000 megawatts in the region.
On July 14, 2017, and July 25, 2017, the U.S. District Court for the Northern District of Illinois and the U.S. District Court for the Southern District of New York, respectively, dismissed challenges to the Illinois and New York Zero-Emissions Credits (ZECs) programs for nuclear generators.1 In doing so, the courts reaffirmed states’ rights to prioritize specific types of generation resources or resource attributes. Relying, in part, on the Supreme Court’s 2016 Hughes2 decision invalidating a Maryland power plant subsidy program, the courts rejected claims that the ZEC programs (i) encroach on the Federal Energy Regulatory Commission’s (FERC or the “Commission”) exclusive authority under the Federal Power Act (FPA) to regulate wholesale sales of electricity by directly affecting prices in the wholesale power markets and (ii) violate the dormant Commerce Clause by discriminating against out-of-state, non-nuclear generators.
On June 9, 2017, Beaver Creek Wind II, LLC and Beaver Creek Wind III, LLC (together, “Beaver Creek”) responded to a deficiency letter from the Federal Energy Regulatory Commission (FERC or the “Commission”) staff seeking further information on Beaver Creek’s calculation of the “one-mile” rule in its applications for certification as qualifying small power production facilities (QFs). At issue is Beaver Creek’s proposed “weighted geographic center” methodology used to calculate the distance between wind projects consisting of multiple pieces of geographically dispersed electric generating equipment (i.e., wind turbines) for the purposes of applying the one-mile rule under the Public Utility Regulatory Policies Act of 1978 (PURPA). With a potential FERC quorum on the horizon, the instant case provides the new FERC commissioners with an opportunity to establish a preferred methodology, if any, for measuring one mile for purposes of PURPA. As such, the outcome could have immediate impacts for renewable energy project developers, particularly those developing wind projects, as they perform due diligence on property selection and equipment siting when planning multiple projects.
On June 19, 2017, the Comisión Nacional de Hidrocarburos (CNH) completed the Presentation and Opening of Bid Proposals for the First Tender of the Ronda Dos (“Round 2.1”), which was first announced on July 20, 2016. Round 2.1 attracted 36 bidders: 20 individual companies and 16 consortia, including Petroleos Mexicanos, DEA Deutsche Erdoel, Talos Energy, Noble Energy, Chevron, Shell, Total and ConocoPhillips.
Round 2.1 included 15 contract areas with an estimated four billion BOE of dry gas, wet gas, light oil, heavy oil and extra heavy oil located in the shallow waters of Veracruz, Tabasco and Campeche.
Click here to read the full alert.
(Houston) – On June 14, Akin Gump lawyers held the firm’s semiannual energy briefing in its Houston office, with guests in attendance at the event as well as via webinar around the world.
In our February update, we noted that ISO New England (ISO-NE) and New York Independent System Operator (NYISO) stakeholders continue to discuss carbon pricing as one potential solution to better align state and regional decarbonization goals with wholesale electricity markets. Since that update, carbon pricing remains on the agenda, though ISO-NE has shifted its focus to “near-term” solutions, and NYISO has halted a study on carbon pricing in anticipation of the Federal Energy Regulatory Commission’s (FERC) upcoming technical conference on state energy policies and the wholesale markets operated by the three eastern grid operators: ISO-NE, NYISO and PJM Interconnection, L.L.C. (PJM). Only the two former grid operators have initiated formal stakeholder discussions featuring carbon pricing thus far; however, as indicated in a recent statement by PJM President and CEO Andrew Ott prior to the conference, PJM is now in the beginning stages of discussing carbon pricing with its stakeholders and state policy-makers. With all three eastern grid operators now considering carbon pricing, FERC’s upcoming technical conference will likely serve as a forum to advance the conversation on carbon pricing as one potential solution to reconcile the wholesale markets with state energy policies.
On March 13, Sen. Jeff Flake (R-AZ) introduced the Ratepayer Fairness Act (RFA). The RFA would amend the Public Utility Regulatory Policies Act of 1978 (PURPA) to require that state public utility regulatory authorities and nonregulated retail electric utilities—such as municipally owned utilities and electric cooperatives—consider the “impact from cross-subsidization of customer-side technology.” In other words, the RFA would direct each state regulatory authority and nonregulated retail electric utility to examine what costs, if any, are imposed by the widespread use of customer-owned distributed generation on other customers and the system as a whole.