On March 17, 2023, the Texas Court of Appeals for the Third District issued an opinion reversing two winter storm Uri orders by the Public Utility Commission of Texas (PUCT) that had raised power prices in ERCOT to $9,000/MWh. ERCOT, the Electric Reliability Council of Texas, manages the electric grid for most, but not all, of Texas and serves approximately 26 million customers.

The decision by the Court of Appeals in Luminant Energy Company LLC v. Public Utility Commission of Texas, No. 03-21-00098-CV, has the potential to affect certain transactions made under the PUCT’s orders. The Court of Appeals not only reversed the PUCT’s orders but remanded them for further proceedings. Should the Court of Appeals’ opinion be upheld, it is unclear how the PUCT will resolve the pricing issues, but it would likely need to hold proceedings to address them. The opinion also raised questions about the authority of the PUCT to issue price caps for Texas’ energy market. …

Continue Reading PUCT Winter Storm Uri Orders Reversed and Remanded by Texas Court of Appeals

On Feb. 15, 2023, the U.S. District Court for the Northern District of Texas held that the force majeure provision contained in the parties’ contract applied to excuse performance even if the event — Winter Storm Uri — did not render performance impossible.

In MIECO LLC v. Pioneer Natural Resources USA, Inc., 2023 WL 2064723, the parties had entered into an agreement in which MIECO (Buyer) would purchase 20,000 million British thermal units of natural gas from Pioneer (Seller) each day from Nov. 1, 2020, to March 31, 2021. But from Feb. 14, 2021, to Feb. 19, 2021, Pioneer failed to deliver the full amount of the contracted natural gas due to Winter Strom Uri. On Feb. 16, 2021, Pioneer sent MIECO a notice of force majeure.…

Continue Reading Winter Storm Uri Qualifies as Force Majeure, Even When Performance Was Not “Impossible”

The Inflation Reduction Act of 2022 (IRA) created several new tax incentives to encourage developing clean energy projects that would benefit underserved communities and individuals. Among these incentives, Congress included generous adders to the Section 48 investment tax credit (ITC) for qualified solar and wind facilities deployed in specified low-income communities or residential developments (low-income community benefit adders).…

Continue Reading IRS Issues Guidance for Energy Tax Credits in Low-Income Communities – Notice 2023-17

On Aug. 16, 2022, President Joe Biden signed into law the Inflation Reduction Act of 2022 (IRA), which includes new and revised tax incentives for clean energy projects. This alert provides a summary of the IRA impact on solar energy tax credits, which were extended and significantly expanded. Additional alerts will provide summaries of the IRA’s impact on other clean energy technologies.…

Continue Reading Inflation Reduction Act Extends and Modifies Tax Credits for Solar Projects

On Nov. 30, 2022, the Transportation Security Administration (TSA) published an advance notice of proposed rulemaking (ANPRM) aimed at enhancing cyber risk management in the pipeline and rail sectors. Indeed, the ANPRM recognizes the critical role pipelines and railroads play in ensuring economic and national security. But the ongoing and growing risk of cyberattacks increases…

On Jan. 18, 2023, a consumer advocacy group issued a letter urging the California Attorney General’s Office to initiate an investigation into rising natural gas prices in the state. If the group’s campaign gains traction, California could join New York as another sizable market investigating whether recent increases in energy prices might give rise to price gouging or other consumer protection-related liability for companies throughout the supply chain.…

Continue Reading Consumer Watchdog Calls on California AG to Investigate Rising Energy Prices

On Aug. 16, 2022, President Joe Biden signed into law the Inflation Reduction Act of 2022 (IRA), which includes new and revised tax incentives for clean energy projects. This alert provides a summary of the IRA’s impact on tax credits for energy storage technologies, which were extended and significantly expanded. Additional alerts will provide summaries of the IRA focused on credits for other clean energy technologies.…

Continue Reading Inflation Reduction Act Creates New Tax Credit Opportunities for Energy Storage Projects

While utility companies and critical infrastructure companies have focused on digital sabotage and cybersecurity over the past few years, such companies must remain cognizant about continued risks of physical sabotage.…

Continue Reading Physical Sabotage Remains A Substantial Risk to Utility Companies and Other Companies Providing Critical Infrastructure

On Dec. 2, 2022, the U.S. Department of Commerce (DOC) released its preliminary determinations over the ongoing investigation into whether solar cells and modules imported from certain Southeast Asian countries were circumventing U.S. duties on solar modules manufactured in the People’s Republic of China.

These findings arrive in the wake of a two-year moratorium on tariffs on solar cells and modules imported from Cambodia, Malaysia, Thailand and Vietnam, as a result of Presidential Proclamation 10414.

The investigation, which began in March 2022, was prompted by allegations made by U.S.-based solar manufacturers against their Chinese competitors, claiming that the accused companies were evading tariffs by selling their products through the four Southeast nations.   

The DOC released its preliminary determinations after a thorough investigation into eight companies based in the four Southeast Asian countries. The DOC preliminarily concluded that four of the eight companies were bypassing U.S. tariffs by exporting Chinese-made solar modules that were only sent to Southeast Asia for minor processing before shipment. The table below summarizes the DOC’s preliminary findings.…

Continue Reading Commerce Department Releases Preliminary Findings on Chinese Solar Manufacturers’ Alleged Circumvention

The Inflation Reduction Act of 2022 (IRA) created many new and revised tax incentives to develop clean energy projects. Among many of these incentives, Congress included a requirement that taxpayers meet prevailing wage and apprenticeship (PWA) standards in the construction of a project to foster growth in good-paying jobs in the energy section. Taxpayers that do not meet these standards will be entitled to a tax benefit, but generally this results in an 80% haircut to the tax credit or deduction.…

Continue Reading IRS Issues Prevailing Wage and Apprenticeship Guidance — Starts 60-Day Clock