The Future of Low-Carbon Hydrogen
Wednesday, April 21, 2021, from 3–4 p.m. CT
Join Kirkland energy regulatory partner Marcia Hook on April 21 for the third in a series of “sustainable” fireside chats with innovators in finance, investment and impact. This ESG chat will feature Andrew Marsh, the CEO of Plug Power; Janice Lin, founder and CEO of Strategen and the founder and president of the Green Hydrogen Coalition; and John Lochner, VP Innovation at NYSERDA. Drawing on their deep experience in the hydrogen space, the panel will share their insights into the rapidly expanding and evolving market for low-carbon hydrogen. For more information, or to register, click here.
Biden Charts Future of U.S. Infrastructure in Ambitious American Jobs Plan
by Brooksany Barrowes, William J. Benitez, P.C., Stephen Butler, P.C., Scott W. Cockerham, Robert S. Fleishman, Nicholas Gladd, Robert P. Goodin, Brian C. Greene, P.C., Jonathan E. Kidwell, Michael J. Masri, Kelann Brook Stirling, Paul D. Tanaka, P.C., Raya B. Treiser and David Wheat, P.C.
In a televised speech from a union hall in Pittsburgh on March 31, 2021, President Biden pitched his $2-trillion-plus infrastructure-focused American Jobs Plan (the “Plan”) as a “once-in-a-generation investment in America.” The Plan is a bold proposal designed to transform the future of infrastructure in the United States. Yet, as members of the Biden administration have acknowledged, the Plan is a framework and will be subject to significant and perhaps transformative revisions through the legislative process.
This post addresses highlights of the Plan, the Biden administration’s proposal for tax increases to pay for its costs and potential market opportunities the Plan would create if enacted. (Continue reading)
Listen: Investment Opportunities in Energy Transition & Technology: Q&A With Trilantic North America and EIV Capital
Kirkland partners Shubi Arora and Matt Nadworny recently led a discussion with Glenn Jacobson of Trilantic North America and David Finan of EIV Capital on the current state of energy transition and technology, including perspectives on:
- Increased investor interest in energy transition and technology strategies
- Differentiation amongst sponsors focusing on energy transition and technology
- Measuring carbon footprint of current portfolios
- Short- and long-term investment opportunities
- Key differences compared to traditional energy investing
- Impact of SPACs on new investments and potential exitsGeneral perspectives on future of energy
Webinar Recording: Carve-Out Transaction Considerations in the Energy Sector
- Overview of Carve-out Transactions and Key Considerations
- Shared Contracts, Guarantees and Regulatory Matters
- Tech & Intellectual Property
- Information Technology
- Transition Services Agreements
- Employment Matters
- Other Separation Specifics
Changing Course: FERC Adopts New Policy on Its Consideration of Certain Climate Impacts in Reviewing Proposed Interstate Pipeline (and LNG?) Infrastructure
On March 22, 2021, the Federal Energy Regulatory Commission (“FERC”), in an order approving a certificate of public convenience and necessity for an interstate natural gas pipeline project (“Order”),1 affected a significant policy shift by formally considering climate change impacts in its approval. The vote on the order was 3-2, with two Commissioners issuing strong dissents raising concerns about the legality of the new policy and its impact on a pending generic proceeding in which FERC currently is accepting public comments. (Continue reading)
Biden Administration’s Energy, Environmental, and Climate Policies: Latest Updates and Actions (March 29, 2021)
This post summarizes noteworthy developments regarding federal energy, environmental, and climate policies in the past several weeks, including: the White House's announcement of a “whole-of-government” approach to jumpstarting the U.S. offshore wind sector; the Department of the Interior's return to regular order of business for reviews of new oil and gas permits on federal lands; remaining uncertainty over the future of the 2020 revisions to NEPA’s implementing regulations; Federal Energy Regulatory Commission limits on the ability of states and other retail electricity regulatory authorities to limit the participation of demand response resources in wholesale electricity markets; and President Biden's upcoming announcement about his planned infrastructure package. (Continue reading)
FERC’s Broadview Reversal Restores and Expands Opportunities for Qualifying Facilities under PURPA
In a March 19, 2021, order, the Federal Energy Regulatory Commission (“FERC”) reversed, on rehearing, its September 2020 order in Broadview Solar, LLC. The reversal restores longstanding FERC precedent for determining qualifying facility (“QF”) eligibility pursuant to the Public Utility Regulatory Policies Act of 1978 (“PURPA”) and extends it to projects with integrated battery energy storage. (Continue reading)
Innovation and Investments in Carbon Capture, Utilization, and Storage
Kirkland recently hosted the first “sustainable” fireside chat in our ESG & Impact Webinar Series. The topic was Innovation and Investments in Carbon Capture, Utilization, and Storage (CCUS). The webinar was hosted by Kirkland ESG & Impact practice leader Alexandra Farmer with special guest Dr. Julio Friedmann, Senior Research Scholar at the Center for Global Clean Energy Policy at Columbia University. The conversation highlighted the burgeoning interest in CCUS, driven by the critical role it is expected to play in attaining the goals of the Paris Agreement, and potential opportunities in the CCUS market. (Continue reading)
Biden Administration’s Energy, Environmental and Climate Policies: Week In Review
This post summarizes noteworthy recent developments regarding federal energy, environmental and climate policies, including: Jennifer Granholm's confirmation as Secretary of the U.S. Department of Energy (“DOE”); DOE's announcement that clean energy industry veteran Jigar Shah will lead its Loan Programs Office, which has $40 billion of existing loan and loan guarantee authority that it can utilize for clean energy projects; and the Senate Committee on Energy and Natural Resources' vote to advance Deb Haaland’s nomination as secretary of the U.S. Department of Interior. (Continue reading)
Industry Efforts to Scale Voluntary Carbon Markets Advance
Industry initiatives are underway to bring scale, standardization and transparency to voluntary carbon offset markets, which are increasingly used as a tool by corporations looking to achieve climate commitments. The Taskforce on Scaling Voluntary Carbon Markets (“TSVCM”) is a private sector-led initiative to standardize and scale the voluntary carbon credit market to help meet the goals of the Paris Agreement. Following a public consultation, on January 27, 2021, the TSVCM published its blueprint (the “Blueprint”) that is intended to serve as a roadmap for creating this market. (Continue reading)
FERC Resumes Review of Key Policies Concerning Interstate Natural Gas Pipeline Certificates(Continue reading)
Webinar Recording: Innovation and Investments in Carbon Capture, Utilization and Storage (ESG & Impact Webinar Series)
Kirkland ESG & Impact partner Alexandra Farmer hosted the first in a series of “sustainable” fireside chats with innovators in finance, investment and impact. This inaugural ESG chat featured Dr. Julio Friedmann, who honed his views on carbon capture, utilization and storage ("CCUS") over decades spent in business, government and academia. Dr. Friedmann is now sought after by some of the world’s largest corporations for his advice on their “carbon wrangling” strategies.
Listen to the full webinar here.
Biden Administration’s Energy, Environmental and Climate Policies: Week In Review (February 19, 2021)(Continue reading)
Industry Update: Texas Mandates All Texas-Produced Natural Gas Be First Made Available for Sale to Power Producers Before Export Out-of-State
On February 17, 2021, Texas Governor Greg Abbott, citing emergency powers, issued a mandate directing the Texas Railroad Commission (“RRC”), the state’s oil and gas regulator, to require “all [Texas] sourced natural gas be made available for sale to local power generation opportunities before leaving the state” temporarily through Sunday, February 21, 2021. In response, the RRC issued a formal Notice to Operators (the “Notice”) the next day restating (verbatim) the Governor’s mandate but did not otherwise issue any rules or provide any formal guidance to the industry.
The lack of specificity in the Notice has left natural gas producers, shippers, marketers, customers and end-users questioning how to interpret the mandate, what the penalties will be for non-compliance (if any), and how (or whether) the RRC will enforce it, if it is enforceable at all. (Continue reading)
Biden Administration’s Energy, Environmental and Climate Policies: Latest Updates and Actions (February 12, 2021)
Real-world impacts of President Biden’s day one Executive Orders and the Administration’s policy shift on energy, the environment and climate have begun. In the last two weeks, the Biden administration has taken actions ranging from the revocation of certain oil and gas permit authorizations to moving forward with a large-scale solar project on federal land in California. The Department of Justice has begun seeking to stay litigation over Trump-era regulatory rollbacks (such as the Navigable Waters Protection Rule) pending review of rules put in place by the Trump administration.
This post summarizes noteworthy developments regarding federal energy, environmental and climate policies in the past two weeks. (Continue reading)
Biden Administration’s Energy, Environmental, and Climate Policies: Week in Review
After the flurry of activity on January 20, 2021, the Biden administration continued to define its energy, environmental and climate policy agenda in its first full week in office. Among the most significant actions announced this week, the Biden administration suspended issuance of new oil and gas leases on federal lands and waters pending completion of a comprehensive review of the federal government’s oil and gas leasing and permitting program. Another important development this week is the U.S. Environmental Protection Agency ("EPA") letter to the U.S. Department of Justice ("DOJ") requesting that DOJ seek to stay all pending litigation over rules promulgated during the Trump administration.
This post summarizes the noteworthy developments impacting the federal energy, environmental and climate policies in the past week. (Read more)
Industry Update: Biden Administration Issues Moratorium on New Federal Oil and Gas Leasing
On January 27, 2021, President Joe Biden signed an Executive Order imposing a moratorium (the “Moratorium”) on new federal oil and gas leasing following the previous issuance of a 60-day suspension of the Department of Interior’s authority to issue federal oil and gas drilling permits. The Moratorium will temporarily prohibit new leasing auctions on federal lands and in the Gulf of Mexico while the Biden administration reviews the existing leasing program (including royalty rates associated with oil and gas production) and its expected environmental impacts. (Read more)
Watch: 2021 U.S. DOE Energy Storage Financing Summit
Kirkland recently co-hosted the 2021 U.S. DOE Energy Storage Financing Summit with Mustang Prairie Energy. The two-part event focused on operating experience and how that translates into unit and portfolio strategy, providing greater transparency to financial institutions, and promoting deeper insights into this emerging asset class to facilitate further investment. Workshops, panels and keynotes featured topics including “Energy Storage — Increased Resiliency and Grid Decarbonization,” “Energy Storage Market Outlook” and more.
Listen to the event here:
Summit Part 1
Summit Part 2
Biden Administration is Off to a Fast Start: Day One Actions on Energy, Environmental, and Climate Issues
by Brian C. Greene, P.C., Brooksany Barrowes, Robert S. Fleishman, Andrew L. Stuyvenberg, Paul D. Tanaka, P.C., Alexandra N. Farmer, Jonathan E. Kidwell, Raya B. Treiser, Tyler Burgess, Aaron J. Newell, Maddy Foote, Madison Erin McMurray and Courtney Tibbetts
President Biden moved quickly to implement his climate agenda on his first day in office, ordering numerous actions in furtherance of his administration’s climate agenda that will have a dramatic impact on the energy and infrastructure sectors. Among his most highly publicized first day actions, Biden announced that the U.S. will rejoin the Paris Climate Agreement. President Biden’s other day one actions on climate included new Executive Orders, the repeal of certain Executive Orders and the freezing of “midnight regulations” issued by the Trump administration, along with sweeping directives to agencies that will result both in changes to how existing laws and regulations are enforced and the issuance of new regulations.
This post covers these day one actions and their impact on energy and infrastructure sectors, as well as other policies expected within the coming weeks. (Read more)
Final Carbon Sequestration Tax Credit Regulations Shorten Recapture Period, Provide Guidance on “Utilization”
The U.S. Department of the Treasury (“Treasury”) and the Internal Revenue Service (the “IRS”) issued final regulations for the carbon sequestration tax credit under section 45Q of the Internal Revenue Code on January 6, 2021. The regulations make a number of important clarifications and technical changes, including by (1) shortening the tax credit recapture period from five years to three, and (2) providing needed guidance on tax credit eligibility for carbon oxide that is “utilized” in a chemical process or put to commercial use.
The regulations finalize, with modifications, an initial set of proposed regulations that was issued in May 2020 and leave project sponsors and investors with a much clearer and complete set of rules than they had in January 2020. (Continue reading)
IRS Relaxes Tax Credit Qualification Rules for Renewable Energy Projects Located Offshore or on Federal Land
IRS guidance released on December 31, 2020, makes it easier for developers of renewable energy projects located offshore or on federal land to qualify for tax credits by giving them an extended 10-year runway to place the projects in service after construction begins. Prior guidance required such projects to be placed in service within four years after the year in which construction began unless the developer could show that it continuously incurred costs and/or performed physical work on a project throughout the construction period.
The extension provides welcome certainty to developers of large-scale projects offshore or on federal lands, particularly offshore wind projects that have been facing permitting and other delays and were pushing up against a four-year deadline. (Read more)
Sweeping Energy and Infrastructure Provisions and Incentives in COVID-19 Relief Bill Signal Important Changes Coming in 2021
On December 27, 2020, President Trump signed into law a massive omnibus appropriations and $900 billion COVID-19 relief bill (the “COVID-19 Relief Bill”). This post explores the implications of the COVID-19 Relief Bill for energy and infrastructure market participants and investors. (Continue reading)
Coronavirus Relief Package Implications for Renewables: Offshore Wind Wins Big and Other Renewable and Carbon Capture Projects See Extensions
Congress passed a $900 billion COVID-19 relief package late Monday night that included multiple tax extension provisions designed to spur investment in solar, wind, carbon capture, and a host of other renewables projects. The legislation – housed in what is titled the Taxpayer Certainty and Disaster Tax Relief Act of 2020, is expected to be signed by President Trump. In this blog post, we discuss the key energy and infrastructure-related provisions in the legislation. (Read more)
Webinar Recording: Energy, Climate and Environmental Matters in a Biden Administration
Kirkland recently hosted this webinar addressing energy, climate and environmental matters in a Biden administration. Kirkland attorneys Scott Cockerham, Alexandra Farmer, Robert Fleishman, Nicholas Gladd, Brian Greene and Jonathan Kidwell discussed what they expect to see in executive orders, federal regulatory actions and legislation.
View a full recording here.
Webinar Recording: A Proposal for Sustainable Investment in the E&P Sector: A Conversation with Kimmeridge Energy
- Trends and opportunities in E&P industry
- Current investor landscape for E&P sector and public E&P companies
- Ability of current investor base to effect industry-wide change
- Perspective on corporate financial management in the E&P industry
- Impact of other industry precedents on the financial management vision of the E&P sector
- Role and effect of global demand for oil and gas on investment
- Near-term industry objectives to mitigate investors' environmental concerns
- Potential impact of environmentally-conscious asset managers and pension funds
- Management alignment and role of compensation in perspectives on financial management and consolidation
- Response to compensation concerns in market
- Key governance concerns for E&P companies
- Characteristics of E&P companies with potential investor engagement
Carbon Sequestration Tax Credit FAQ #4: What are Qualifying Emissions Sources for Section 45Q Tax Credit Projects?
To qualify for carbon capture tax credits, the tax rules require that a “qualified facility” be the source of carbon oxide emissions. Subject to minimum capture requirements described in this post, a “qualified facility” can be any industrial facility, electricity generating facility or direct air capture facility, as long as (i) the construction of the facility begins before 2024, and (ii)(A) either the construction of the carbon capture equipment at the facility begins before 2024 or (B) the original planning and design for the facility includes the installation of carbon capture equipment. (Continue reading)
Dealmaking for the Bridge and Tunnel Crowd — Infrastructure M&A in the Current Environment and Beyond
While some pockets of the M&A market have shown inconsistency in the wake of COVID, interest in the infrastructure sector remains strong. The factors that incubate a healthy dealmaking environment in this asset class remain favorable, and continued interest in the sector should be expected. But infrastructure M&A presents its own set of unique dynamics that must be skillfully navigated to create successful outcomes. (Continue reading)
House’s Clean Economy Jobs and Innovation Act Would Create Opportunities and Impose Restrictions on Different Segments of the Energy and Infrastructure Sectors
On September 24, 2020, the U.S. House of Representatives passed the Clean Economy Jobs and Innovation Act, H.R. 4447 (“CEJIA” or the “Bill”) by a vote of 220-185, largely on party lines. The Bill would authorize new research and development initiatives at the Department of Energy (“DOE”) and new funding for electric vehicle infrastructure, electric grid modernization, energy efficiency programs and environmental justice programs. We summarize the CEJIA provisions that have the strongest potential to impact the energy and infrastructure sectors. (Continue reading)