On May 17, 2018, the Federal Energy Regulatory Commission (FERC or the “Commission”) granted in part and denied in part a request by Zeeland Farm Services, Inc. (“Zeeland”) for a waiver of FERC’s regulations requiring small power production Qualifying Facilities (QFs) to self-certify their QF-status under the Public Utility Regulatory Policies Act of 1978 (PURPA).1 Zeeland claimed that its failure to self-certify (i.e., its failure to file a FERC Form 556), was a good-faith, inadvertent error by individuals and companies not otherwise engaged in the power industry.2 Although FERC granted Zeeland’s request that its wind farms be treated as QFs during the period of noncompliance—an approximately 10-year period—it denied such request with regard to the exemption for QFs under 20 MW from FERC’s filing requirements under Section 205 of the Federal Power Act.
In September 2017, we reported on a Court of Appeals of North Carolina decision holding that entities installing solar panels on customer rooftops are “public utilities” under state law, at least if they retain ownership of the panels and sell the output to the customer.
On May 9, 2018, Environmental Protection Agency (EPA) Administrator Scott Pruitt issued a memorandum outlining a “back-to-basics” process for reviewing National Ambient Air Quality Standards (NAAQS) for criteria pollutants—carbon monoxide, lead, ground-level ozone, nitrogen dioxide, particulate matter and sulfur dioxide—under the Clean Air Act (CAA). “Consistent with [EPA’s] commitment to cooperative federalism,” the memo establishes five principles to guide future NAAQS reviews, with the laudable goal of complying with the five-year statutory deadline for review.
Earlier this week, on April 30, 2018, the U.S. Environmental Protection Agency (EPA) quietly modified its source determination test that is used to determine whether emissions from nearby and closely related sources should be grouped together for New Source Review (NSR) and Title V permitting programs. The decision paves the way for the Pennsylvania Department of Environmental Protection to treat a biogas processing facility and an adjacent landfill as separate sources and escape regulation under NSR or Title V. According to EPA, because the two sources would be owned by separate entities, and each entity would lack direct control of the other, there was no “common control” of the sources. EPA emphasized that its “narrower interpretation,” focusing on “the power or authority of one entity to dictate decisions of the other that could affect the applicability of, or compliance with, relevant air pollution regulatory requirements,” will promote clarity, consistency and more practical outcomes in source determinations.
On April 30, 2018, the Environmental Protection Agency (EPA) published in the Federal Register a controversial proposed rule seeking to restrict the types of scientific research and findings that the EPA can consider in formulating new environmental regulations.1 Increasingly embattled EPA Administrator Scott Pruitt announced the new rule on April 24, 2018, during an event that was closed to the media. During the announcement, Pruitt placed the impetus for the proposed rule on “transparency” and stated that the move would end “the era of secret science at EPA.” The proposal would allow the agency to use and rely upon only scientific studies where the underlying raw data and methodology is publicly available. Critics, including former EPA Administrator Gina McCarthy and scientists, say that the proposed policy change would prevent the EPA from complying with the mandate to consider the “best available science” when preparing a rulemaking under various statutes, including the Toxic Substances Control Act (TSCA) and the Safe Drinking Water Act (SDWA). Further, critics note that the rule threatens public-health research and the underlying privately protected health information, as well as confidential business information, which form the basis for many important pollution and human health-related protections. Given the disparity between Pruitt’s claims about the rule’s purpose and the criticisms regarding the rule’s potential effects, it remains to be seen who this proposed rule would benefit and whether it will actually bring important issues of integrity to light or if the rule may actually leave the EPA in darkness with respect to important scientific findings.
In its Global Energy Report 2018, Project Finance International has published the article ““Financing power at the shallow end,” written by Dan Sinaiko and John Marciano, co-heads of the global project finance group at Akin Gump Strauss Hauer & Feld LLP. The article looks at how new unconventional offtake structures have stimulated a wave of ingenuity for project developers and their financiers.
To read the full article, please click here.
On April 11, 2018, the U.S. Fish and Wildlife Service (FWS) issued a Memorandum titled “Guidance on the recent M-Opinion affecting the Migratory Bird Treaty Act” (the “Memorandum”), giving field advice to its enforcement officers based upon an earlier interpretation of the Migratory Bird Treaty Act expressed in a December 2017 Opinion from the Department of Interior. As described in detail, in our prior alert, that Opinion reversed a long-standing interpretation of the MBTA by concluding that the MBTA does not prohibit unintentional killing or injuring of migratory birds (also known as “incidental take”).
On March 30, 2018, the Federal Energy Regulatory Commission (FERC or the “Commission”) issued separate orders (i) partially granting one of two challenges to PJM Interconnection, L.L.C.’s (PJM) frequency regulation (“Regulation”) market reform1 and (ii) rejecting PJM’s proposed operational enhancements to its Regulation market (“October 2017 Proposal”).2 Given the overlap in issues raised during the proceedings, the Commission also established a technical conference to explore PJM’s Regulation market design under its requirement that wholesale electricity market operators compensate for Regulation service “based on the actual service provided.”3