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Expert Insights: Clean-tech and renewable energy law

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"Going green" has grown to become a standard term in the vernacular of business and the California community at large. With that growth has also come a wide variety of new laws and regulations in the last few years, such as a new state cap-and-trade program, new building code standards, environmental legislation and requirements for the use of cleaner technology as it becomes available. The Daily Transcript spoke with two lawyers in this growing field of clean-tech law to unfold how new laws in this arena have impacted their profession and what may be expected down the road.

Considering the currently evolving and expanding nature of climate change and clean-tech law, how is the field of competition changing in the area of practice? Do you see this practice growing from lawyers who have practiced in other fields, or is there a growing field of young, more specialized attorneys? How does either observation affect your approach in your practice?

Sophie Akins Partner Best Best & Krieger

When I first started working on renewable energy projects in 2003 -04, the economy was strong and there were only a handful of attorneys in California -- myself included -- who specialized in renewable energy law. I remember attending the first few Solar Power International conferences and not seeing any other lawyers, which always seemed odd to me. Until a few years ago, I did not know of another lawyer with my specialty (public agency distributed generation renewable energy projects and power purchase agreements) in California.

Since then there has been a significant downturn in the economy which resulted in a number of experienced attorneys branching out of their practice areas to generate new business by specializing in renewable energy. Within the past few years, law students have been calling me to ask for advice on building renewable energy law practices, because they accurately see this as an ever-changing field for which there is a bright future.

As we have seen just over the life of the California Solar Initiative (CSI), a number of new federal and state laws and regulations have been enacted, creating unique opportunities for attorneys to specialize in different facets of renewable energy law. This includes: renewable energy project financing; permitting; water rights; interconnection’ property leases; environmental; contracts and construction defect issues. This law sector as a whole has benefited from the enthusiasm and commitment of both new and senior attorneys.

There also can be significant risks posed to clients of lawyers who have little or no experience financing and building renewable energy projects. Inexperienced lawyers may not be able to anticipate the practical as well as legal risks inherent in a renewable energy project. As an example, I know of a property owner who felt more comfortable using their senior general counsel to negotiate their solar contracts – but the counsel had never worked on a solar project before. Unfortunately, negotiations were drawn out and as a result, the property owner lost their CSI incentive. An experienced lawyer would have understood the significance of the CSI deadlines, not taken as long to understand and negotiate the contracts and submitted them to the CSI program, saving the funds. Ultimately, the property owner's desire to use their senior counsel cost them more than a half million dollars in incentives. This may be an extreme example, but it highlights the fact that renewable energy projects are complicated, unique transactions that have many additional risks than a typical construction project or real property lease transaction.

Given my experience in the field, I regularly speak at conferences, provide free webinars and draft articles to help ensure that all renewable energy projects -- not just those of my clients -- are well-vetted and successful. As one of the more seasoned renewable energy attorneys in the state, I view my role to be akin to an educator and advocate. I am also engaged with industry groups and policymakers to ensure that we continue to support and promote renewable energy project finance and development.

John Lormon Partner Procopio, Cory, Hargreaves & Savitch LLP

As companies move toward being more "green," what’s the future of clean technology and clean energy law aimed at businesses? Is the law related to the movement clearly defined enough, in your opinion, and what is an example of how it is or is not?

As companies and agriculture operations move toward a sustainable and carbon reduced/neutral world, the clean technology and energy legal practices will grow. The regulatory practice in the power sector is well established and defined, yet, the regulation of greenhouse gases creates a new layer of oversight that includes cap-and-trade impacts on the electricity markets, carbon allowances and carbon credits, and it sets the stage for the interplay between renewable energy credits (RECs) and the carbon markets. All of these programs promise to lead to specialized legal practices within the energy, climate and sustainability sectors.

The absence of a comprehensive U.S. federal climate policy leaves room for continued leadership by states such as California and for regional initiatives and partnerships like the Western Climate Initiative. The outlook for such a dynamic in California and our region includes establishment and management of these offset markets, the negotiation and drafting of emission trading and reduction agreements, feed-in-tariff contracts, etc. all of which involve legal work for counsel.

- Compiled by James Palen

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