Energy Regulatory Practice

The fundamental restructuring underway in the electric utility industry requires industry participants to position themselves to take maximum advantage of the many new opportunities available while adequately managing the myriad new risks. Thriving in today's rapidly evolving energy market therefore necessitates having lawyers who think creatively and adapt to complex and rapidly changing regulatory constraints. Orrick’s Energy Regulatory Group includes leading practitioners in the regulation of independent power projects, transmission system operators, power exchanges, power marketers, traditional electric utilities, natural gas pipelines, and cogeneration and alternative energy production facilities. These lawyers have many years of experience representing clients before federal agencies, state public utility commissions, and state and federal courts, in proceedings involving the Federal Power Act, the Public Utility Regulatory Policies Act of 1978, the Public Utility Holding Company Acts of 1935 and 2005, the Natural Gas Act, the Natural Gas Policy Act of 1978, and the Energy Policy Acts of 1992 and 2005, along with various state restructuring initiatives.

Orrick’s Energy Regulatory Practice offers a full breadth of experience on such traditional utility issues as issuances of securities, mergers and acquisitions and disposal of assets subject to the FERC’s jurisdiction, sales for resale in interstate commerce of electric energy, the terms and conditions of interconnection and transmission service, and the development and licensing of gas storage projects. The practice includes the negotiation and drafting of power sale agreements, interconnection agreements, and transmission contracts. In addition, lawyers in the Group have provided clients with advice and assistance on issues associated with the implementation of independent transmission system operators and power exchanges (including both the California and PJM restructurings), open-access transmission services, mandatory transmission services, negotiating and drafting power purchase agreements between utilities and independent power producers, the rendering of wholesale sales at market-based rates, obtaining authorization for a utility to have an affiliate engage in power marketing and brokering, and the establishment of affiliated companies providing electric service as exempt wholesale generators.

Lawyers in the Energy Regulatory Practice also have actively participated on behalf of various energy companies in the investigations and related litigation in connection with the energy market dysfunction in the western United States.

Projects in which members of the Group have played a significant role include the following:

• The PJM Interconnection LLC’s filing with the FERC in response to the requirement that PJM provide additional information and clarification in connection with the provision of ancillary transmission services under the PJM Open-Access Transmission Tariff.
• Cincinnati Gas and Electric Company’s successful merger with PSI Energy, Inc. to form CINergy Corporation. Involvement included preparation of the merger application before the FERC, as well as successful settlement negotiations with multiple intervenors. Involvement also included obtaining SEC approval of the merger under the now repealed Public Utility Holding Company Act of 1935, notwithstanding strong opposition from numerous parties.
• New England Electric System’s merger with National Grid Company of the United Kingdom, one of the first successful foreign utility purchases of an integrated domestic utility.
• Neptune Transmission Company’s successfully receiving FERC approval for an innovative merchant-based electric transmission rate proposal involving an auction of firm transmission rights for an underwater merchant transmission line linking Canada and the Northeastern Untied States.
• Duquesne Light Company’s successful restructuring pursuant to the implementation of retail competition in Pennsylvania. Major actions included restructuring state retail and related wholesale transmission tariffs, determining stranded cost issues and executing an auction of generation assets and the obligation to provide “provider of last resort” (POLR) to retail customers.
• Tomen Power Corporation’s restructuring of its various United States QF and EWG operations.
• Pacific Gas and Electric Company’s successful emergence from Chapter 11 bankruptcy.
• Representing various entities involved with The California Independent Transmission System Operator and The California Power Exchange successfully obtaining FERC approvals to operate as an ISO and PX, including a finding that the California ISO’s charter and by-laws satisfy the requirements under Order No. 888 applicable to ISOs.
• Florida Power Corporation’s marketing affiliate successfully obtaining FERC approval for a mechanism permitting the marketer to engage in power marketing at market-based rates in Florida notwithstanding transmission constraints in and at the Florida border.
• Doswell Limited Partnership’s development and successful $500 million project financing of the first power project to receive authority from the FERC to sell power at market-based rates. Involvement included preparation and review of transaction documents and obtaining the necessary regulatory exemptions under the Federal Power Act and the Public Utility Holding Company Act of 1935.
• BOT Financial Corporation’s acquisition and successful leveraged lease financing of the 600 MW Amercentrale Power Station Unit 9 in Geertruidenerg, The Netherlands. Involvement included preparation and review of the financing documents and obtaining all of the necessary regulatory exemptions on behalf of the financial institutions providing the funding for this $1.2 billion transaction.
• ESI Energy, Inc.’s successful acquisition of a limited partnership interest in Doswell Limited Partnership, including obtaining an SEC No-Action Letter under the Public Utility Holding Company Act of 1935 and FERC approval under the Federal Power Act.
• Great Bay Power Corporation's successful application to obtain the first “Exempt Wholesale Generator” exemption for a nuclear powered Facility under the Public Utility Holding Company Act of 1935 in connection with its undivided ownership in the Seabrook Nuclear Generating Unit.

In addition, Practice lawyers have provided regulatory assistance in several utility merger proceedings, jurisdictional reorganizations, and transmission access and pricing proceedings. They have appeared before numerous state public utility commissions and have been involved in dozens of financings involving qualifying cogeneration and small power production facilities and independent power producers. Members also have appeared before the Department of Energy regarding exporting electricity and related matters. In the natural gas area, members of the Practice have represented clients before the FERC on a variety of matters, including pipeline certificates, open-access settlement negotiations, and marketing affiliate compliance.

International Regulatory Advice

Members of Orrick’s Regulatory Practice have also advised on the development of regulatory frameworks for the power and gas industries in a number of emerging markets. These include advising on legal and regulatory reform in countries as diverse as Bolivia, India, South Africa, and Turkey. In the United Kingdom, Orrick lawyers have a high level of expertise in the unbundling and privatization of the UK electricity industry and market restructuring from 1988 through 1990, and have subsequently been involved in a wide range of regulatory issues in the changing landscape of the UK power and gas regulatory regimes since 1990. Our lawyers were involved in writing the first ever “green ticket” contracts in the UK and have had a great deal of experience in the regulation of generation and transmission, as well as distribution.