On February 22, 2021, the United States Federal Energy Regulatory Commission (FERC) announced its intention to open a new proceeding to examine the threat that climate change and extreme weather events pose to electric reliability. The proceeding will examine how grid operators prepare for and respond to extreme weather events, including, but not limited to, droughts, extreme cold, wildfires, hurricanes, and prolonged heat waves. FERC also announced that the proceeding would include a technical conference with an opportunity for parties to submit comments in advance of that conference, with additional details to follow.
On February 23, 2021, the House of Representatives discussed and approved the draft of the Amendment of the Electricity Industry Law proposed by Mexico President López Obrador with a total of 304 votes. One of the most relevant features of the Amendment is the modification of the dispatch order, disregarding economic efficiency mechanics, which will result in more expensive and dirty energy.
The Legal Update at the link below details the session of the House of Representatives and the next steps on the legislative process.
A Mexican Court issued a provisional suspension in an amparo proceeding of the new hydrocarbons and fuels import and export rules enacted by the Ministry of Energy on December 26, 2020. As a result, the permitting regulation for the import and export of hydrocarbons and petroleum products originally published by the Ministry of Energy on 2014 will remain applicable for all market participants until the final judgement is issued.
The Legal Update at the link below details the effects and applicability of such suspension.
On January 27, 2021, President Biden signed Executive Order 14008, Tackling the Climate Crisis at Home and Abroad (the “Order”). The Order sets forth the Biden administration’s policies to address climate change through both foreign and domestic policies and demonstrates the administration’s intent to make addressing climate change a top priority for nearly every department and agency of the federal government. The Legal Update at the link below provides an overview of the main policy priorities established by the Order and certain governmental bodies created to coordinate the development and implementation of these policies.
In December 2020, the State Council Information Office of China published a white paper titled Energy in China’s New Era. The white paper presents China’s achievements and goals in energy development and outlines the strategies, and policies for future energy reform.
People-Centered Goals – Clean Energy, Clean Living
The white paper stresses that the ultimate goal for energy development in China is to promote growth in the economy and provide benefits to people’s lives. By end of 2015, access to electricity for every citizen has already been achieved, and China aims to provide more diverse energy supply and services to all urban and rural residents. For instance, significant progress has been made in clean and green energy heating, with a 21.6% increase in clean-energy heating within 3 years in rural regions of northern China by the end of 2019. Additionally, development of poverty-stricken areas will be prioritized in the overall plan and layout of energy projects. China has implemented the strategy of rural revitalization to facilitate energy development and alleviation of poverty in rural areas. These measures complement the aim of reducing regional disparities and improving living standards for all residents.
The electricity industry in Mexico is under stress. The President of Mexico has proposed amendments to the Electricity Industry Law that could result in the undoing of the energy reform that permitted private investment in the power market. In parallel, the Mexican Supreme Court issued a decision rejecting a number of provisions of the Ministry of Energy’s controversial Reliability Policy, which was challenged by the Mexican antitrust agency COFECE. Up until now, the Mexican judicial system has upheld the legality of the energy reform and pushed back against the government’s attempts to strengthen the Electricity Federal Commission (CFE) to the detriment of foreign investors. However, the President’s proposed amendment of the Electricity Industry Law evidences that the government will persist.
The Legal Updates at the links below describe the proposed amendments and the Supreme Court Decision.
Over 1,000 firms have made either indicative or concrete pledges to align their greenhouse gas emissions with the Paris Agreement—which means reducing emissions to zero by 2050. For many firms, achieving this aim will require the use of carbon offsets at some point. On January 27, 2021, the Taskforce on Scaling Voluntary Carbon Markets published its blueprint on creating a large-scale, transparent carbon credit trading market.
Please see Legal Update at link below.
Since US President Biden’s inauguration, the Biden administration has taken several actions to restrict the issuance of oil and gas permits for production on federal public lands and federal offshore waters, but the extent of the shift in policy undertaken remains uncertain as the US Department of Interior has continued to issue permits for drilling on such public lands and waters. Accordingly, the Interior Department’s future actions will need to be monitored carefully to assess the scope and implications of the administration’s policy with respect to energy development on federal lands and waters.
See Legal Update at the link below:
The inauguration of the Biden administration will bring a plethora of policy changes focused on US electric power production, fuel, and climate change mitigation and remediation. The Biden administration’s Climate Executive Order, discussed further in this Legal Update, declares the intention to “reduce greenhouse gas emissions” and “bolster resilience to the impacts of climate change.”
Please see Legal Update at link below:
On January 20, 2021, US President Joseph Biden signed a series of executive orders, including one titled “Protecting Public Health and the Environment and Restoring Science to Tackle the Climate Crisis.” This executive order contains a series of directives to federal agencies and departments that will significantly impact the energy sector and signals the high priority the Biden administration is placing on addressing climate change.
The Legal Update is at the link below.