Welcome to the 12th and final issue of Currents for 2022.
We are extremely pleased to share that Spilman was named to the 2023 "Best Law Firms" list by U.S. News-Best Lawyers in 61 areas of law throughout our firm’s footprint. The rankings are based on a rigorous assessment process that involves the collection of client and lawyer evaluations, peer reviews from leading attorneys, and review of additional information provided by law firms. You can learn more here.
We wish you and yours a wonderful holiday season. We hope it is filled with thanks and gratitude!
As always, thank you for reading.
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“The industry includes about 1,600 offshore oil and gas facilities that are highly dependent on remotely connected operational technology, the report said.”
Why this is important: The pandemic and remote work brought to light several national security issues, one of which is the vulnerability of utilities to cyberattacks. This vulnerability also plagues offshore oil and gas facilities that are highly dependent on outdated remotely connected operational technology. The Department of the Interior's Bureau of Safety and Environmental Enforcement (“BSEE”) has long recognized the need to address cybersecurity risks, but has taken few actions to do so. In 2015 and 2020, BSEE initiated efforts to address cybersecurity risks, but neither resulted in substantial action.
Absent the immediate development and implementation of an appropriate strategy, offshore oil and gas infrastructure will continue to remain at significant risk of attacks by state actors and cybercriminals. Such a strategy would call for, among other things, an assessment of cybersecurity risks and mitigating actions, and the identification of objectives, roles, responsibilities, resources, and performance measures. --- Joseph C. Unger
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“Thousands of railroad workers in the United States are prepared for a work stoppage by Dec. 5, the end of the cooling off period to allow for more negotiations.”
Why this is important: A potential nationwide rail strike could be devastating to West Virginia and the U.S. economy, according to West Virginia Coal Association President Chris Hamilton. Hamilton noted coal is the most rail dependent energy source in the U.S. Most coal sent to U.S. power plants is by rail and most metallurgical coal is hauled by train to docks for export or to U.S. steel mills. In total, Hamilton says 69 percent of West Virginia coal is transported by rail. Also, many remaining coal-fired electrical generation plants in the U.S. have low stockpiles and could quickly cease power generation if rail deliveries cease. Congress is currently working on a bill to avoid the strike that could occur on December 5. One of the key issues for unions is they do not have sick days provided to them and Congress may address that issue by law outside of the union contracts. --- Mark E. Heath
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“China and North America are expected to lead the charge.”
Why this is important: The United States and multiple European countries are dependent on natural gas as an energy source for the next several years. Our domestic shale gas producers can supply that demand so long as adequate pipeline capacity is developed. Unless we can fill that void from reserves located in the United States, then the energy requirements of portions of our domestic market as well as that of our European allies will be subject to pressures from unfriendly producers over which we have little if any control. Streamlining the permitting process for new pipeline capacity is essential to the economic well-being and energy security of both our country and our allies. --- William M. Herlihy
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“West Virginia will receive $26.6 million in funds from the federal Office of Surface Mining, Reclamation and Enforcement.”
Why this is important: West Virginia will receive $26.6 million in funds from the federal Office of Surface Mining, Reclamation and Enforcement to be used for an Abandoned Mine Land Economic Revitalization program. The 2016 program is designed to repurpose abandoned mine lands and create recreational opportunities for affected communities. In West Virginia, the grants have helped develop the Elk River Trail built on an abandoned coal hauling railroad. Funds have also been used for solar farms on mine sites. These funds are in addition to $140 million in Abandoned Mine Land funds that West Virginia received from the Infrastructure Investment and Jobs Act of 2021. --- Mark E. Heath
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“New aggressive planning is needed to identify the long-duration storage technologies and find the land to grow enough resources to reach Biden net zero emissions goals, a DOE national lab reports.”
Why this is important: Moving to net zero carbon emissions in the electricity generating sector by 2035 is possible, according to this study, but that result is premised upon some assumptions that have not yet materialized, and may never occur. Significant build-out of new solar and wind facilities and transmission lines will be needed, at a time when many communities are rejecting siting approval. In addition, unless large scale energy storage systems are created and constructed, intermittent power will not be dispatchable when needed. It may seem a long time until 2035, but lengthy periods for engineering each project, getting it approved, and then constructing it, mean efforts have to start immediately. --- David L. Yaussy
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“FERC also directed the North American Reliability Corp. to develop a plan to register the entities that own and operate IBRs and approved updated interconnection requirements for those resources.”
Why this is important: IBRs are solar photovoltaic, wind, fuel cell and battery storage resources that use power electronic devices to change direct current power, produced by generators, to alternating current power, to be transmitted on the bulk-power system. As use of this technology grows (860 GW is estimated to come online over the next decade), it is important to ensure that IBRs do not adversely impact the technical reliability of the grid. FERC identifies four reliability gaps pertaining to IBRs: (1) data sharing; (2) model validation; (3) planning and operational studies; and (4) performance requirements. FERC is not proposing specific requirements in this rulemaking. Instead, FERC is directing NERC to develop one or more new reliability standards or modify currently effective reliability standards to address FERC’s concerns. --- Joseph C. Unger
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“A team of three labs will use remote communities to study the efficacy of turbines designed to fit into 20-foot shipping containers.”
Why this is important: The National Renewable Energy Laboratory and Idaho National Laboratory have spent four years working on fast and reliable power solutions for natural disaster events and the U.S. military. Solar was studied, but concerns remain if there is not enough sunshine to generate power. The current project is focusing on using rapidly deployable portable wind turbines. Each 20-kilowatt turbine, along with batteries and solar panels, would fit in 20-foot shipping containers that could be shipped worldwide. That size container is often used by emergency response groups and the military. Plans are to test the systems in remote areas of Alaska that need power now to see how the turbines hold up and what consistent power they can generate. Once testing is completed, the systems could be used worldwide. --- Mark E. Heath
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“Over the past few years, major economies and businesses have looked to tap into the emerging green hydrogen sector.”
Why this is important: Green hydrogen, produced by electrolysis of water using electricity generated by renewables, is widely viewed as a means of moving to a sustainable future. But electrolysis is an uneconomic process, and some are concerned that transitioning to hydrogen will actually encourage use of fossil fuels in the short run, weakening demand and opportunities for wind and solar. The takeaway is that the energy transition will be a complicated process that will play out over a long time. --- David L. Yaussy
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“Lithium, which some have dubbed ‘white gold,’ is crucial to the batteries that power electric vehicles.”
Why this is important: China dominates world markets for lithium and rare earth metals. That gives it enormous leverage in world affairs, as the renewable economy can’t work without lithium ion batteries. The rest of the world is slowly waking up to that fact, and taking steps to develop its own lithium sources. --- David L. Yaussy
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Here is a round-up of the latest statistics concerning the energy industry.
PETROLEUM
NATURAL GAS
COAL
RENEWABLES
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