Energy

DLA Piper LLP Energy Bulletin

 

This regular publication by DLA Piper lawyers focuses on helping clients navigate the ever-changing business, legal and regulatory landscape.

President Obama reveals Clean Power Plan. Calling it the “single most important step that America has ever made in the fight against global climate change,” on August 2 President Barack Obama unveiled the final version of regulations implementing the Clean Power Plan, a major climate change plan that seeks to reduce greenhouse gas emissions from the nation’s coal-burning power plants. The President said, “Power plants are the single biggest source of harmful carbon pollution that contributes to climate change. Until now, there have been no federal limits to the amount of carbon pollution plants dump in the air.” The US gets more than a third of its electricity from coal. The plan requires the states to meet specific carbon emission reduction standards, rewarding states that achieve early deployment of renewable energy and low-income energy efficiency. A few days before the plan was announced, more than a dozen US states asked the US Court of Appeals for the DC Circuit to rehear a case in which they had challenged the Clean Power Plan. When the states sued the EPA previously, the appeals court ruled their challenge was not ripe for a decision because the rules were not yet fully in effect.

Boehner supports lifting prohibition on export of crude oil. House Speaker John Boehner (R-OH) now supports lifting the long-standing ban on the export from the US of crude oil. “I would support lifting the ban and I hope that we can work together in a bipartisan fashion to bring our energy policies into this century,” Boehner said on July 29. The ban was first put into place during the Arab oil embargo of the early 1970s. Higher US-based oil production, which has made the US the leading worldwide oil producer, has also led to a substantial level of new interest in ending this prohibition. Boehner said that in his view, permitting exports of crude would lower US pump prices. However, some economists believe that lifting the ban would raise the price of domestic crude, bringing it into line with international prices – and that this would actually cause pump prices to rise. Proposals to lift the ban have been circulating on Capitol Hill for more than a year.

Environmental groups oppose Modernization Act. A broad coalition of national environmental groups announced its opposition on July 27 to the Energy Policy Modernization Act, a broad bipartisan energy reform bill proposed by leading US legislators from both parties, among them Senator Lisa Murkowski (R-AK) and Senator Maria Cantwell (D-WA). The bill aims to provide the nation with more affordable energy and more abundant energy. The environmental groups expressed opposition to nearly a dozen provisions of the act, notably including a proposed effort to speed up approval of the process of approving terminals for the export of liquid natural gas. The groups said that this change would “tie our economy more closely to fossil fuels at a time when we should be transitioning away from their use.”

Clinton reveals her energy policy. Presidential candidate Hillary Clinton’s newly announced energy policy, revealed on July 26, sounds like good news for renewable energy producers. She pledged tax incentives that would help install half a billion solar panels nationwide within four years of her taking office. She also said the US would be able to generate enough renewable energy to power every home in the country by 2027. However, some climate change scientists say Clinton’s plans are not enough. James Hansen, a climate change researcher who headed NASA’s Goddard Institute for Space Studies for over 30 years, said, “You cannot solve the problem without a fundamental change, and that means you have to make the price of fossil fuels honest. Subsidizing solar panels is not going to solve the problem.”

Is there a major loophole in New York State’s anti-fracking law? Although New York state approved a fracking ban in June 2015, many opponents and supporters of fracking agree that a technique that uses gelled propane rather than water in the extraction process may not fall under the law’s prohibition. One major objection to fracking, a process that normally uses very large amounts of water to create fractures in rock that release gas, is that it can pose serious risks to the drinking water supply. The industry is proposing to use gelled propane instead, describing it as a more environmentally friendly technique because it would avoid poentially deleterious effects to the water supply. New York is the only state with a major shale gas formation to ban fracking. Whether the energy industry will choose to explore this avenue remains unclear.

For more information about these developments and their effect on your business, please contact your DLA Piper Relationship Partner or:

Joseph Tato
Global Co-Chair, Energy Sector
joseph.tato@dlapiper.com
+1 212 335 4975

 

Robert Gruendel
Global Chair, Energy Sector
robert.gruendel@dlapiper.com
+1 212 335 4736

Robert Alessi
Global Vice Chair, Energy Sector
robert.alessi@dlapiper.com
+1 212 335 4866

 

 


Published by DLA Piper LLP (US)
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