Read our recent LawFlash discussing the US Department of the Treasury’s updated criteria outlining which businesses are eligible to apply for CARES Act loans allocated for businesses “critical to maintaining national security.”
Our energy lawyers have prepared a LawFlash addressing the notice of proposed rulemaking (NPRM), “Update to the Regulations Implementing the Procedural Provisions of the National Environmental Policy Act,” published today in the Federal Register by the White House’s Council on Environmental Quality (CEQ). The proposed rule has four major elements: (1) to modernize, simplify, and accelerate the NEPA process; (2) clarify terms, application, and scope of NEPA review; (3) enhance coordination with states, tribes, and localities; and (4) reduce unnecessary burdens and delays.
To date, the commercial nuclear power industry has expressed strong support for the types of rule changes proposed by the CEQ in its NPRM, as they are intended to streamline and expedite the federal agency NEPA review process. Those in the industry that depend on federal agency action when advancing projects and securing permits should actively participate in the proposed rulemaking and help the CEQ build a sufficient agency record to defend against any later litigation challenges to new regulations.
Join Morgan Lewis lawyers for these upcoming programs:
EBA Primer Series: Cybersecurity in the Energy Industry
December 09, 2019
Participants: Arjun Prasad Ramadevanahalli
Energy Storage: Regulatory, State, and Transactional Developments
December 12, 2019
Participants: Neeraj Arora , Kenneth M. Kulak , Levi McAllister
Electrifying the Transportation and Building Sectors in the PJM Footprint
December 18, 2019
Participants: Kenneth M. Kulak, Stephen M. Spina
The Federal Energy Regulatory Commission (FERC) ordered PJM Interconnection, LLC’s (PJM) on July 25 to suspend its 2019 Base Residual Auction (BRA), which provides for capacity payments to electric generators. FERC found that delaying the auction until FERC establishes a replacement rate would provide greater certainty to the market than conducting the auction under the existing rules.
This is the second time that the 2019 BRA, which provides for capacity payments for 2022–2023, has been delayed. PJM originally planned to run the auction in May, but delayed it based on a prior FERC order. FERC’s July 25 order delays the 2019 BRA until FERC establishes a replacement rate.
The US Court of Appeals for the Second Circuit on September 27 affirmed a decision of the US District Court for the Southern District of New York dismissing a complaint seeking to invalidate New York’s Zero Emissions Credit (ZEC) program. This decision comes on the heels of a Seventh Circuit decision affirming the validity of a similar ZEC program in Illinois. In its opinion, the Second Circuit noted that its conclusions accorded with the Seventh Circuit’s decision, which we wrote about in an earlier post.
The US Court of Appeals for the Seventh Circuit on September 13 affirmed a decision of the US District Court for the Northern District of Illinois that dismissed two complaints seeking to invalidate the Illinois Zero Emission Credits (ZEC) program.
The Illinois ZEC program was created in 2016 as part of the Future Energy Jobs Act. A ZEC is a credit that represents the environmental attribute of one megawatt hour of energy produced from an eligible zero-emission facility as defined by the statute. The Illinois Power Agency confers ZECs to eligible facilities generating zero-emission power and requires utilities to purchase those ZECs. The act set an initial price for ZECs based on a calculated “social cost” of carbon, but the price can adjust downward based on an index of wholesale power prices. While the eligible zero-emission generators will still participate in wholesale electricity markets, ZECs provide additional out-of-market payments to compensate the generators for their zero-emission power.
As we reported last month, on June 20, the Council on Environmental Quality (CEQ) initiated the rulemaking process to revise its National Environmental Policy Act (NEPA)–implementing regulations by publishing an Advance Notice of Proposed Rulemaking (ANPR) in the Federal Register. The ANPR seeks public comments on “potential revisions to update the regulations and ensure a more efficient, timely, and effective NEPA process consistent with the national environmental policy stated in NEPA.” On July 11, the CEQ announced that it is extending the comment period, which was scheduled to close on July 20, for 31 days until August 20, 2018, in response to public requests for a time extension. See 83 Fed. Reg. 32,071 (July 11, 2018). The Federal Register notices also provide instructions for filing comments on the ANPR.
We reported last month that the Council on Environmental Quality (CEQ), the US federal agency responsible for coordinating and overseeing federal agency implementation of the National Environmental Policy Act (NEPA), had signaled its intention to update the CEQ’s longstanding NEPA-implementing regulations (40 CFR Parts 1500-1508). On June 20, the CEQ initiated the rulemaking process by publishing an Advance Notice of Proposed Rulemaking (ANPR) in the Federal Register (83 Fed. Reg. 28,591). The ANPR seeks public comments “on potential revisions to update the regulations and ensure a more efficient, timely, and effective NEPA process consistent with the national environmental policy stated in NEPA.” The deadline for comments is July 20, 2018.
President Donald Trump directed Energy Secretary Rick Perry late last week to “prepare immediate steps to stop the loss” of “fuel-secure power facilities” arguing that a decline in coal and nuclear generation is jeopardizing the nation’s security. The federal government has not yet disclosed what those steps might be or which generation facilities are at issue. Nonetheless, press reports from CNN and Bloomberg, among others, suggest that the US Department of Energy (DOE) is considering a directive requiring Independent System Operators and Regional Transmission Operators (ISOs/RTOs) to purchase energy from designated “fuel-secure” plants for a period of up to, and possibly more than, 24 months to prevent any near-term decommissioning.
The US Department of Justice (DOJ) and the Federal Energy Regulatory Commission (FERC) filed a joint brief on May 29 in the US Court of Appeals for the Seventh Circuit, stating that Illinois’ zero emission credit (ZEC) program for eligible nuclear plants in Illinois is not preempted by the Federal Power Act (FPA). Because the panel in a substantially similar case pending in the Second Circuit has indicated that it would review the government’s filing in the Seventh Circuit case, the views of FERC and DOJ could be critical as this issue plays out in the federal court system.
The Illinois legislature passed a law in 2016 requiring utilities to purchase ZECs at administratively set prices from nuclear plants in the state. Generators that compete with the ZEC-receiving nuclear plants challenged the law, arguing that the ZEC program is preempted by the FPA. The district court upheld the program, and the generators appealed the decision to the Seventh Circuit. FERC did not take a position in the trial court but has now done so after the Seventh Circuit invited the US government to file a brief.