Sustainability Law Blog

Governor Ted Kulongoski vetoed two bills passed by the 2009 Oregon Legislature that related to renewable energy. HB 2472b would have rolled back the Business Energy Tax Credit for large renewable energy projects by reducing the maximum available credit from 50% of eligible costs not to exceed $20 million, to 35% of eligible costs not to exceed $10 million. HB 2940b would have expanded the list of resources eligible for credit against the state's renewable portfolio standard by allowing utilities to count biomass facilities built before 1995.

In vetoing the legislation, the Governor expressed his belief that the changes went too far and put Oregon at a competitive disadvantage in the growing renewable energy sector, one of the few sectors performing well in difficult economic times. Renewable energy advocates celebrated the Governor's veto.

Post authored by David Petersen, partner practicing in the Sustainability and Real Estate and Land Use Groups.

The U.S. Departments of Energy and the Treasury are accepting applications for a program that will make direct payments in lieu of tax credits to companies that create and place in service renewable energy facilities, under Section 1603 of the American Recovery and Reinvestment Act. The agencies estimate they will pay out at least $3 billion to approximately 5,000 bio-mass, solar, wind, and other types of renewable energy production facilities. Applications should be made as soon as possible as the grants will be awarded only until the program funding is exhausted. The government estimates that $3 billion in grants will leverage between $10-14 billion in additional private capital investment. Interested applicants should contact their legal and financial advisors promptly for further information.

Post authored by David Petersen, partner practicing in the Sustainability and Real Estate and Land Use Groups.

The much-anticipated guidelines and application instructions for renewable energy cash grants available under the February 2009 stimulus bill have been released by the Department of Treasury. Section 1603 of the stimulus bill (formally known as the American Recovery and Reinvestment Act of 2009, or ARRA) provides for cash grants in lieu of tax credits equal to 30% of a renewable energy project's cost.

The cash grant program will be used mostly by wind developers, many of whom have delayed projects while waiting to see how the regulations turn out. The regulations resolved two important issues in favor of developers. First, the regulations confirm that application for an Section 1603 grant will not, by itself, trigger review of the project under the National Environmental Policy Act (NEPA). Second, projects receiving grants will not be obligated to pay prevailing wages under the Davis Bacon Act of 1931.

Applications may be made online at treasury.gov through October 1, 2011. Payment will be made to qualified applicants within 60 days after approval or the date the project is placed in service, whichever is later. The Treasury anticipates receiving about 5,000 applications.

Post authored by David Petersen, partner practicing in the Sustainability and Real Estate and Land Use Groups.

BPA has requested $2 million in grants from the U.S. Department of Energy to study use of pumped storage as a tool in balancing uneven power supplies from wind energy. Pump storage projects generally involve the use of wind power to pump water uphill, which is stored until energy demand increases, at which time the water is released downhill to drive energy-generating turbines. Energy Secretary Steven Chu has often promoted pump storage as a promising option for evening out wind energy output, and the Federal Energy Regulatory Commission recently approved a pump storage project on the Little Potlatch Creek in Idaho. Numerous companies are investigating other potential pump storage project sites in Oregon and Washington, including Symbiotics, a Utah-based hydropower developer that also seeks to retrofit existing dams that currently do not have hydroelectric capabilities.

Post authored by David Petersen, partner practicing in the Sustainability and Real Estate and Land Use Groups.

Following the lead of San Francisco, Portland launched a new website last week that will allow people to zoom in on a satellite image of any rooftop in the city to determine its suitability for solar panels. The site also provides information on carbon and energy cost savings, tax credits, and other incentives for solar development. The City hopes the Oregon Clean Energy Map will boost the City's profile as part of the growing Oregon solar energy industry sector. The City developed the site through a $200,000 cash grant from the U. S. Department of Energy's Solar America Cities program.

Post authored by David Petersen, partner practicing in the Sustainability and Real Estate and Land Use Groups.

Recently Pacific Gas and Electric Company (PG&E) announced it has entered into a series of contracts with BrightSource Energy, Inc. for a record total of 1,130 megawatts (MW) of solar power. These power purchase agreements cover seven projects, the first of which is expected to begin operation in 2012. All seven of the projects are expected to produce enough power each year to equal the consumption of about 530,000 average homes.

This announcement shows the impact the California renewable portfolio standard is having. California has one of the nation's most ambitious renewable portfolio standards, requiring electric utilities to increase procurement from eligible renewable energy resources by at least 1% of their retail sales annually, until they reach 20% by 2010. Governor Schwartzenneger has signed an executive order establishing a goal of serving retail consumers with 33% of their power from renewable resources by 2020. According to the California Public Utilities Commission, PG&E serves 11.4% of their 2007 retail electricity sales with eligible renewable power. PG&E and other California utilities are working hard to reach the aggressive goals established for renewable energy in 2010 and 2020.

Post authored by David White, partner practicing in the Sustainability Practice Group.

Pike Research, a cleantech market research firm, has forecast that installed wind capacity in the U.S. will reach 320 gigawatts by 2015, which is an increase of 165% over 2008. This forecast is 20% lower than other forecasts put out by the wind energy industry, but still shows that wind energy has favorable prospects for growth over the next 5 years as compared to other industries. Pike believes that as the credit markets loosen up we will see reinvestment in the wind energy sector faster than in other sectors of our economy. I think this relative optimism was reflected in the general positive tone of Windpower 2009 in Chicago a few weeks ago.

Post authored by David Petersen, partner practicing in the Sustainability and Real Estate and Land Use Groups.

Windpower 2009 has come to a close. I took away two primary impressions from the conference. First, the industry is a jobs driver -- 22,000 people attended and only a small minority were there for the jobs fair. People are employed in this business and working enthusiastically. Second, the conference showed how windpower is maturing as an industry -- as one person I met said, the companies that had big displays at prior conventions put up smaller displays, and the little guys multiplied exponentially. Rather than the 100 or so players you would see five years ago, the industry now has tens of thousands of companies involved. There is depth and diversity in the supply chain that reflects an industry putting down strong roots in our economy. I'm already looking forward to Windpower 2010 in Dallas.

Post authored by David Petersen, partner practicing in Sustainability and Real Estate and Land Use Groups.

It probably is a four mile walk to see every exhibit in the convention hall at Windpower 2009 in Chicago. There are 20,000 people here, which is 10 times the population of my hometown of Arcade, New York. The sheer size and scope can be overwhelming. But it is also encouraging. In this difficult economy, the enthusiasm and capital directed at wind energy continues to grow exponentially. There is no economic gloom and doom to be heard. People here see the recession as a bump in the road to our inevitable clean energy future. The collective enthusiasm is infectious and makes me glad to be involved in this industry.

Post authored by David Petersen, partner practicing in the Sustainability and Real Estate and Land Use Groups.

First day of Windpower 2009 in the Windy City. I attended this conference in Los Angeles in 2007 and thought it was big then, but this conference is twice the size. Most notable difference? 2007 was mostly developers and turbine manufacturers. This year I see a lot of contractors, construction companies and component manufacturers. Everything from crankcase oil to safety harnesses. I think lots of people recognize this is one industry still functioning in this economy.

Post authored by David Petersen, partner practicing in the Sustainability and Real Estate and Land Use groups.