On December 7, 2009, the U.S. Department of Energy (“DOE”) announced the issuance of a final rule amending certain provisions of its loan guarantee program for innovative technologies as authorized by Section 1703 of Title XVII of the Energy Policy Act of 2005 (“Final Rule”). The amendments reverse the DOE’s previous interpretation of two provisions of Section 1702 of Title XVII to require a superior first lien on any property acquired pursuant to a guarantee. The Final Rule was promulgated by the DOE after its review of all comments submitted in response to the DOE’s Notice of Proposed Rulemaking and Opportunity for Comment published on August 7, 2009 (“NOPR”). (Please refer to our summary of the NOPR circulated on August 7, 2009, for more information on the proposed changes.)

On December 17, 2009, the Federal Energy Regulatory Commission (“FERC” or the “Commission”) released an order (“Enforcement Order”) that authorizes the Secretary of the Commission to issue a Staff’s Preliminary Notice of Violations (“Notice”) after the entity that is subject to an investigation has been given the opportunity to respond to staff’s preliminary findings.  Additionally, the Commission released a Policy Statement where the Office of Enforcement (“OE”) will provide exculpatory evidence to those entities subject to their investigations and respondents in administrative enforcement proceedings. 

On December 17, the Environmental Protection Agency (“EPA”) Administrator Lisa Jackson issued a decision requiring the Kentucky Department of Air Quality (“KDAQ”) to consider whether the proposed Cash Creek Integrated Gasification Combined Cycle (“IGCC”) plant should consider generating electricity with natural gas rather than the syngas produced in the gasification process.  The decision was issued in the context of determining the Best Available Control Technology (“BACT”) requirements in Cash Creek’s Prevention of Significant Deterioration (“PSD”) permit. EPA said that natural gas might be a lower polluting fuel than syngas.

On December 11, 2009, Senator Maria Cantwell (D-WA), along with Senator Susan Collins (R-ME), introduced a “cap and dividend” climate bill called the “Carbon Limits and Energy for America’s Renewal (Clear) Act.”  The Clear Act aims to lower greenhouse gas (“GHG”) emissions 20% from 2005 levels by 2020, 30% by 2035, and 83% by 2050. 

On December 7, 2009, the Environmental Protection Agency (“EPA”) promulgated its long-awaited endangerment finding.  Evidently timed to coincide with the beginning of the international climate change negotiations in Copenhagen, the Agency’s finding states that elevated atmospheric concentrations of six greenhouse gases (“GHGs”) emitted by man – carbon dioxide, methane, nitrous oxide, hydrofluorocarbons, perfluorocarbons, and sulfur hexafluoride – are contributing to dangerous climate change. 

On December 3, 2009, the Federal Energy Regulatory Commission (“FERC” or the “Commission”) denied Clipper Windpower Development Company, Inc.’s (“Clipper Windpower”) emergency motion and request for temporary waiver of part of the California Independent System Operator Corporation’s (“CAISO”) Large Generator Interconnection Procedures (“LGIP”).  In its motion, Clipper Windpower argued that the current security deposit requirements within CAISO’s LGIP would force it to post a $7.5 million deposit for upgrades that would cost approximately $4.6 million.