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With Most State Capitols Closed, Some States Press Forward on Clean Energy Legislation

While the COVID-19 pandemic continues to keep most of America home, including state legislators, some states have managed to pass landmark clean energy legislation whilst prioritizing matters related to the novel coronavirus.

In New York, the state with the most confirmed coronavirus cases to date, state legislators recently passed The Accelerated Renewable Energy Growth and Community Benefit Act as part of the FY 2020-2021 state budget on April 3. The Act, which focuses largely on siting changes, will create the Office of Renewable Energy Siting to create a streamlined process for siting of large-scale renewable energy projects across the state. While the state’s existing energy generation siting process was designed for siting fossil-fuel e energy generating plants, the new process establishes uniform environmental standards and aims to expedite project development for renewable energy projects. The Act also includes provisions ensuring that renewable energy development is targeted to maximize economic development and environmental protection, directing the benefits of renewable energy projects to the local host community, and helping to prioritize the planning, investments and responsible development of grid infrastructure.

The provisions contained in the Act will move New York towards its clean energy and climate goals, including the current mandate to obtain 70% of the state’s electricity from renewable sources. In addition to combatting climate change, the Act will help New York to speed economic recovery from the COVID-19 crisis.

The Virginia state government took similar action when, on April 12, Governor Ralph Northam signed into law the Virginia Clean Economy Act. The Act requires the state to transition to 100 percent carbon-free or renewable energy by 2050, making Virginia the eighth state to set such a mandate and the first state in the southern United States to do so. Provisions included in the Act include a moratorium on new fossil fuel plants until 2022, requirements that utilities meet targets for helping customers to use less energy by 2025, and new parameters for the expansion of renewable power, which require that Virginia develop 5,200 megawatts of offshore wind power by 2034. Energy companies that do not meet the new targets will be fined, with portions of that revenue going towards job training and renewable energy programs in low-income and otherwise disadvantaged communities.

On the same day, Governor Northam also enacted an amended version of the Clean Energy and Community Food Preparedness Act, which now requires the state to join the Regional Greenhouse Gas Initiative. That initiative, known as the RGGI, is a cooperative effort among states to cap and reduce carbon dioxide emissions from the power sector. As a member of the initiative, Virginia will establish an auction program to sell allowances into the market-based program.

However, despite these promising developments, the closure of statehouses around the country, and the postponement of legislative sessions in over half of states, has led to the inevitable slowdown of renewable energy legislation, stalling many reforms in the clean energy space indefinitely.

In Illinois, similar legislation to that passed in Virginia that would bring Illinois up to 100 percent renewable energy by 2050 has been put on ice since the state government in Springfield was closed down in early March. The Clean Energy and Jobs Act, which would add a monthly renewable energy charge to residents’ energy bills, establish opportunities for clean energy job training, and provide incentives for small businesses, would have a complicated route to passage in any environment due to its complexity and the number of stakeholders involved. Now, however, the state’s first priority is enacting legislation concerning the COVID-19 crisis, making it even less likely that the bill will be passed for at least the next several months.

Interruptions and deferrals of state legislative sessions has affected a number of other state-level clean energy initiatives. In Minnesota, the capitol’s closure has stalled efforts to find consensus around a clean energy bill that would prioritize carbon-free energy over fossil fuels and strengthen the state’s energy efficiency standard. In Michigan, a statutory cap on distributed generation for rooftop solar installers is scheduled to expire in the coming weeks. Because states are currently focused on legislation critical to the management of the COVID-19 pandemic, it appears that clean energy initiatives will be placed, at least for the foreseeable future, on the back burner.

©1994-2020 Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. All Rights Reserved.National Law Review, Volume X, Number 127


About this Author

Sahir Surmeli Energy & Sustainability Attorney Mintz Levin

Sa is a highly skilled and versatile business counselor who advises companies, boards, entrepreneurs, investment banks and venture and private equity investors, as they build and grow companies. He handles public offerings, 144A and private financings, acquisitions, joint ventures and strategic partnerships. Sa guides public and private companies and investors, primarily in the energy and sustainability, technology, materials science, hospitality, retail and life sciences industries. Known as a problem-solver, Sa executes transactions with creative structures to address new opportunities...

Member / Chair, Energy & Sustainability Practice

Tom Burton’s zeal for innovation and passion for energy and sustainability have shaped the clean energy industry. He created one of the nation’s first clean energy legal practices. Clients ranging from investors to entrepreneurs to Fortune 100 companies rely on him for creative and strategic legal solutions, and he has completed hundreds of venture capital and private equity financings, mergers and acquisitions, and IPOs. He guides the industry’s next generation of leaders through active involvement with start-up organizations and accelerators. The Northeast Clean Energy Council recognized his pioneering role in the Northeast with a Decade of Influence award in 2017.

Tom’s global practice focuses on complex corporate finance matters including mergers and acquisitions, venture capital, private equity, and securities transactions. He represents high-growth and emerging businesses, including companies in the energy and clean technology, social media and software industries, as well as life science companies, from start-ups to public companies.

In 2004, Tom founded, and currently chairs, the firm’s Energy & Sustainability Practice, which has completed more than 500 transactions across energy sectors totaling over $8.5 billion since 2006. Serving more than 250 clients, spanning the ecosystem from emerging companies to large corporations, venture capital and private equity funds, investment banks, project developers, and family offices, the firm is recognized nationally as a leading law firm in the space. Tom is ranked byBest Lawyers in America in the Corporate Law section, and he is recognized by The Legal 500 United States as “rising to the fore” in energy technology for Venture Capital and Emerging Companies.

On the corporate and securities side, Tom has served as counsel in the structuring and completion of over 400 venture capital and private equity financings, representing both the funds providing the capital and the emerging growth companies seeking funding. His work in this area has raised billions of dollars. He organizes venture capital funds and represents them in their portfolio investments. Tom is also a key contributor to MintzEdge, an online resource for entrepreneurs that includes useful tools and information for starting and growing a company. In addition, he devotes a portion of his practice to counseling social enterprise companies, impact investors, and nonprofit companies.

Tom routinely counsels businesses on their growth and development, advises their boards of directors on corporate governance matters, and participates in an array of transactions, from private and public offerings to mergers and acquisitions, joint ventures, and technology transfer matters. Tom also has experience in advising investment banks in private placements and underwritten public offerings of equity securities, and in their role as financial advisor in mergers and acquisitions.

He applies his background in corporate finance to counsel energy and clean technology companies through all stages of formation, financing, and exits. His energy and clean technology clients span markets such as solar and wind, smart grid and energy efficiency, energy storage, water technologies, waste treatment, biofuels, electric vehicles, and green buildings.