On Monday—Earth Day—the Washington Legislature’s final passage of three bills put an exclamation point on a string of significant climate and energy legislation.  In total, the Washington Legislature has passed seven bills this month, which will reduce greenhouse gas (GHG) emissions from utilities and buildings, boost renewable energy, and improve energy efficiency in buildings.  Here, we summarize all seven.  Another major bill to reduce GHGs from transportation has cleared the House but remains in Senate committee limbo. SB 5116, a 100% clean energy bill, is the most important enactment, par ..read more

In June 2014, the Federal Energy Regulatory Commission initiated a review of price formation in energy and ancillary services markets operated by regional transmission organizations and independent system operators.  Based on its evaluation, the FERC recently required PJM Interconnection, LLC and the New York Independent System Operator, Inc. to implement tariff changes designed to produce prices for energy from “fast-start resources” that reflect the marginal cost of serving load more accurately, while respecting the value of fast-start resources in meeting system needs.  PJM Interconnection ..read more

Several weeks ago, we reported on a new Federal Energy Regulatory Commission (FERC) Notice of Inquiry (NOI) seeking comments on whether its existing return on equity (ROE) policy should be revamped. A recent federal court of appeals ruling enhances the importance of this new FERC NOI for those concerned that the current policy encourages pipeline overbuilding. Under its existing policy, FERC grants virtually all new gas pipeline expansions an ROE of 14 percent regardless of perceived investment risk. FERC’s decision to reexamine this policy comes almost a year after it issued, to much fanfare ..read more

As part of the Administration’s policy in favor of domestic oil and gas development, on April 10 President Trump issued an Executive Order “Promoting Energy Infrastructure and Economic Growth.” The EO seeks to make the regulatory process more efficient and to create “increased regulatory certainty.” A policy focus in the EO is water quality certification under section 401 of the Clean Water Act. Section 401 provides that before a federal agency may approve a project that could result in a “discharge” to navigable waters, the state or tribe with jurisdiction must certify that the discharge woul ..read more

In the continuing a series of Trump deregulation failures, a federal judge in the Northern District of California rejected in harsh terms an effort by the Department of the Interior (DOI) to replace the Valuation Rule for royalties on oil, gas and coal from federal and Indian lands adopted by the Obama DOI. That 2016 rule had been developed after five years of review, comment and consideration by the agency.  In State of California, et al. v. U.S. Department of the Interior, Senior Judge Saundra Brown Armstrong, a Bush appointee, held that DOI was arbitrary and capricious in replacing the exis ..read more

Energy storage resources such as pumped storage hydroelectric generators, lithium ion batteries, and flywheels, are becoming increasingly significant in maintaining the reliability and resilience of the interstate electricity grid. However, these resources, which both inject energy into the grid and receive energy from it, have unique operating characteristics which affect their ability to participate in organized markets for the supply of capacity, energy, and ancillary services. In February 2018, the Federal Energy Regulatory Commission issued its Order No. 841, in which it required each Reg ..read more

Market power mitigation measures adopted in 2005 to address horizontal market power concerns arising from the merger of Louisville Gas and Electric Company and Kentucky Utilities and the subsequent withdrawal of LG&E/KU from the Midcontinent Independent System Operator, Inc. have recently been terminated by the Federal Energy Regulatory Commission, over the objection of Commissioner Cheryl LaFleur. Louisville Gas and Electric Company and Kentucky Utilities Company, 166 FERC ¶ 61,206 (2019). Need for Market Power Mitigation LG&E and KU are electric public utilities in Kentucky which pro ..read more

In western states that have legalized cannabis over the last few years, water agencies have seen a sharp increase of permit applications to secure water rights. Cannabis is an agricultural crop and, of course, it needs water to grow. The water needed to irrigate those crops is similar to what almonds and pistachios require.[1] With the legalization of hemp in the 2018 Farm Bill came more economic opportunity for cannabis farmers and investors, but without secured water rights this opportunity will remain largely untapped. This advisory first provides an overview of Western water law and the cu ..read more

As reported in this space, in November 2018, the U.S. Supreme Court remanded to the Court of Appeals for the Fifth Circuit a determination by the U.S. Fish & Wildlife Service on critical habitat for the dusky gopher frog. The issues for the Fifth Circuit on remand would be whether habitat in which the dusky gopher frog could not currently live without modification could be designated “critical habitat” under the Endangered Species Act, and consideration of the cost implications of the critical habitat designation for the private landowner. The FWS is now requesting that the Fifth Circuit r ..read more

Oregon moved to regulate air toxics with SB 1541, which became effective April 10, 2018. Regulations implementing the air toxics requirements were adopted by Oregon DEQ in November of 2018 and, as explained below, draft risk assessment guidance has now been released for public comment. The agency estimates that 400 facilities will be impacted by the new regulations and it hopes to complete permitting for 20 of those facilities by the end of the first year. DEQ has not said which 20 will have that honor, but new major source facilities will need to evaluate air toxics as part of their permit ap ..read more