Energy & Infrastructure Blog

Drawing from the knowledge and experience of our 300 lawyer-strong Energy & Infrastructure Practice Group, this blog provides updates and legal analysis on timely issues involving these ever-evolving markets. Bookmark this page and visit frequently or subscribe to our mailing list to keep up with the latest. Inquiries may be directed to editor Brian C. Greene, P.C., or the authors as noted. 

24 February 2020

Tariffs and Coronavirus Impacting U.S. LNG Trade to China

by Brian C. Greene, P.C. and Mateo Todd Aceves

China is the most lucrative growth market for LNG producers worldwide, and Chinese demand for LNG appears poised for continued growth for years to come. This fact isn't lost on U.S. policymakers — as underscored by President Trump's decision to include LNG executives in a select group of U.S. business leaders accompanying him on a visit to China in 2017. So why isn't the U.S. exporting more LNG to China? (Continue reading)

22 February 2020

IRS Releases First Wave of Carbon Sequestration Tax Equity Guidance

by Scott W. Cockerham

The IRS issued much-anticipated guidance for the carbon sequestration tax credit under section 45Q of the Internal Revenue Code on February 19, 2020, a critical step towards unlocking a potential multibillion-dollar new tax equity market for carbon capture. The guidelines establish a framework that will be very familiar to sponsors and investors in renewable energy projects. We summarize the newly issued IRS guidance and note a few open issues that may require further clarification from the IRS. (Continue reading)

Upcoming Event - February 26, 2020

Join us: Advancing Renewables: Overcoming Regulatory, Legal and Financial Hurdles
New York, NY — Wednesday, February 26 from 4:00–7:00 p.m. ET

Kirkland energy regulatory partners Bob Fleishman and Brooksany Barrowes will co-host a seminar with former regulators at TRC in Kirkland's New York office to share their perspectives on the challenges facing the renewables industry in the northeast.

For more details or to register, please see the event invitation.

21 February 2020

Why 5G Won’t Follow the Typical Deployment Approach (and New Opportunities for Investors in Broadband)

by Brian C. Greene, P.C. and Joe Kochan (US Ignite)

New innovations in spectrum licensing and network design are opening up the possibility that islands of 5G coverage built for enterprise and special-purpose use may spring up as early as this year, beginning with the June 25, 2020, auction 105 for the Citizens Broadband Radio Service band. These individual network deployments may in turn accelerate 5G coverage — and lead to new investment opportunities. (Continue reading)

19 February 2020

How Anti-Corruption Issues Can Derail a Project: A Case Study on the Recent Cancellation of the Codelco Desalination Project in Chile

By Nathan Santamaria and Toochi Ngwangwa

The market was surprised in December 2019 when executives from Codelco, Chile's state-owned copper mining company and the world’s largest copper producer, announced the cancellation of a concession it had granted to build a massive desalination plant in northern Chile. Codelco restarted the tender in part to ensure that the process complied with new “probity and transparency” requirements at the mining company. The decision illustrates certain potential risks for financial institutions with respect to FCPA violations, and the sensitivity of long-term project finance lenders to anti-corruption concerns involving affiliates of a borrower. (Continue reading)

14 February 2020

Update: On February 13, 2020, FERC announced that it intends to act on all four of the proceedings discussed in our original February 5, 2020, blog post at its February 20, 2020, open meeting. We intend to post a summary and thoughts regarding FERC’s actions shortly following this meeting.

MOPR Migration: Implications of FERC’s PJM Capacity Market Order in the New York and New England Electricity Markets

by Brooksany Barrowes and Robert S. Fleishman


FERC recently issued an order expanding the application of the Minimum Offer Price Rule (“MOPR”) in the PJM Interconnection, L.L.C. (“PJM”) capacity market, to address what FERC identified as a price suppressive effect of state-subsidized generation resources.

Press coverage of FERC’s PJM MOPR order has focused on its implications for energy infrastructure investment in the PJM region, which is the largest regional transmission organization in the U.S., reaching 13 states plus the District of Columbia. If the order does indicate a policy shift at FERC, it may also be significant for energy infrastructure investment and development outside of the PJM states, as FERC is currently considering electric market design changes in New York and New England. (Continue reading)

14 February 2020

California Oil & Gas Legislation Takes Effect, Could Impact Production

by Paul D. Tanaka, P.C. and Stefanie I. Gitler

On January 17, 2020, California’s Attorney General filed a complaint in the U.S. District Court for the Central District of California challenging the U.S. Bureau of Land Management decision to make certain federally managed lands in the state available for oil and natural gas development. Earlier in the month, a series of significant changes to California’s regulation of oil and natural gas production came into effect.

In general, this shift elevates the importance of public health and environmental considerations in the regulation of oil and natural gas production within the state. In turn, production activity within the state is likely — at least in the near- and medium-term — to face both longer odds and longer waits for permitting. (Continue reading)

13 February 2020

Wind Developers Receive Unexpected Benefit in Latest Production Tax Credit Extension

by Scott W. Cockerham

The latest production tax credit (“PTC”) extension included an unexpected boost in value that will benefit developers of both on-shore and off-shore wind projects. The Further Consolidated Appropriations Act, 2020 (H.R. 1865), signed into law in late 2019, not only extended the phase-down schedule for PTCs by an additional year, but also increased the value of projects that start construction in 2020 compared to those that started in 2019.

Although off-shore wind developers were disappointed that the tax extenders legislation did not include a standalone tax credit for off-shore wind, they may benefit the most from the legislation’s value boost for 2020 projects. (Continue reading)


12 February 2020

Mexico Midstream Booms (and Blues)

by Nathan Santamaria

Despite a recent slowdown over the last year in the broader Mexican energy and infrastructure sectors, the pace of development and financing of refined products import, storage and transport infrastructure has remained strong. This investment concentration in refined products import, storage and transport projects addresses a key infrastructure issue for Mexico.

However, in a shift from the policies of the previous administration, the issuance of fuel import permits to new entrants over the past year has slowed significantly, according to an industry analyst. There are also reports of stalled storage facility development due to delays in issuances of key permits. While these issues may benefit private incumbents with increased market share, it could slow the expansion of new capacity. (Continue reading)

10 February 2020

Tax-Equity Market Eagerly Awaiting Carbon Sequestration Guidance

by Scott W. Cockerham

Fifteen members of the U.S. House of Representatives sent a letter to the U.S. Department of the Treasury in December urging it to release guidance for carbon capture projects under section 45Q of the tax code. Potential tax-equity investors have expressed interest in carbon capture projects, but the market has yet to develop due largely to a lack of guidance around key aspects of the statute and how tax-equity financing would work.

Open questions include the circumstances under which the credit is subject to recapture, the allocation of the credit among partners of a partnership, and the mechanics for making an election permitted by the statute to allow the entity that permanently buries or otherwise uses the carbon oxide to claim the credit in lieu of the owner of the carbon recapture equipment. (Continue reading)

10 February 2020

2020 Outlook for U.S. LNG Projects

by Kelann Brook Stirling, Ginger Webb Collier and Mateo Todd Aceves

Over the past 10 years, a fundamental revolution in U.S. gas production — driven primarily by new drilling and gas recovery technologies — upended the domestic and world energy economy and drove tens of billions of dollars of investment in U.S. Looking ahead into 2020, we identify three prominent trends to watch in the industry: (i) completion of a “second wave” of U.S. liquefaction projects and final investment decisions on future projects, (ii) continued maturation of a global LNG market and its effects on the sale and marketing of LNG and (iii) increased M&A activity in the LNG sector. (Continue reading)

07 February 2020

Trump Administration Proposes Revisions to NEPA Rules

by Paul D. Tanaka, P.C. and Tyler Burgess

Recently, the White House’s Council on Environmental Quality announced a proposed rulemaking that would represent a dramatic overhaul of the National Environmental Policy Act (“NEPA”) implementing regulations. The stated goal of the proposed changes is to streamline the environmental review process to reduce the time and costs federal agencies expend in advancing projects and permits.

We discuss five key takeaways from these new regulations, which could have significant impacts on a broad spectrum of infrastructure and energy development projects, among others. (Continue reading)

05 February 2020

MOPR Migration: Implications of FERC’s PJM Capacity Market Order in the New York and New England Electricity Markets 

by Brooksany Barrowes and Robert S. Fleishman

FERC recently issued an order expanding the application of the Minimum Offer Price Rule (“MOPR”) in the PJM Interconnection, L.L.C. (“PJM”) capacity market, to address what FERC identified as a price suppressive effect of state-subsidized generation resources.

Press coverage of FERC’s PJM MOPR order has focused on its implications for energy infrastructure investment in the PJM region, which is the largest regional transmission organization in the U.S., reaching 13 states plus the District of Columbia. If the order does indicate a policy shift at FERC, it may also be significant for energy infrastructure investment and development outside of the PJM states, as FERC is currently considering electric market design changes in New York and New England. (Continue reading)

04 February 2020

New Year Brings EV Initiatives in New York, New Jersey

by Robert S. Fleishman, Andrew L. Stuyvenberg and Brett Nuttall

State-level efforts to enhance electric vehicle (“EV”) deployment continued apace in January, with broad new legislation in New Jersey and a significant administrative proposal in New York. States are set to continue leadership in EV implementation in the coming year, with most innovation likely to come from jurisdictions that have set ambitious climate, clean-energy or clean-transportation goals. Like the New Jersey and New York initiatives, the next round of EV-related efforts is expected to move beyond simple incentives for vehicle purchase, and to include support for an EV transportation ecosystem with enhanced recharging opportunities to address skeptical consumers’ concerns about vehicle range and utility. (Continue reading)

About Us

Kirkland has nearly 300 lawyers in our Energy & Infrastructure Practice Group. We represent public and private companies, financial institutions, and private equity firms and hedge funds in cutting-edge transactions in the upstream, midstream, downstream, water, power (conventional and renewable), infrastructure and services sectors, and our attorneys have decades of experience advising clients in these sectors throughout the life-cycle of the underlying assets. Our attorneys collectively cover all of the practice areas necessary to drive successful outcomes for our clients in these transactions and engagements, including corporate M&A, private equity, fund formation, capital markets, debt and project finance, restructuring, litigation, tax, environmental, real estate and energy regulatory practices, among others.