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W. Andrew Jack

Andrew Jack has a diverse corporate and securities practice with clients principally in the energy, industrial manufacturing, technology and sports and entertainment industries. He regularly represents corporations, board committees, and other forms of enterprises in mergers and acquisitions, strategic alliances, financing activities, securities law compliance, corporate governance counseling, and executive compensation arrangements. Mr. Jack also co-chairs the firm's Energy Industry Group.

On May 29, 2024, the Department of the Treasury (Treasury) and the IRS released proposed rules for the section 45Y clean electricity production tax credit (“Section 45Y Credit”) and the section 48E clean electricity investment tax credit (“Section 48E Credit”).  These credits are informally referred to as tech-neutral credits because they do not specify particular technologies eligible for credits, unlike the existing production and investment tax credits.  Below we summarize certain important provisions in these proposed rules and some of their implications for project finance for constructing facilities with net-zero greenhouse gas (“GHG”) emissions, such as a need for emissions accounting and monitoring. Comments are due on August 2, 2024, and a public hearing is scheduled to be held on August 12 and 13.Continue Reading When Is the Greenhouse Gas Emissions Rate Not Greater Than Zero?  Proposed Regulations on the Tech-Neutral Credits Provide Clarification

On May 28, the Biden-Harris Administration issued the Voluntary Carbon Markets Joint Policy Statement and Principles (Policy Statement).  You can find Covington’s analysis of the Policy Statement here.  Jointly announced by the U.S. Secretaries of Treasury, Agriculture, and Energy, and senior White House climate officials, the Policy Statement describes a three-pronged approach to responsible carbon market development and participation: (1) credit or supply integrity, including protections regarding climate and environmental justice; (2) demand integrity, to ensure the credible use of credits; and (3) market-level integrity, including facilitating efficient market participation and lowering transaction costs.  The Policy Statement builds on other recent federal actions, including the Commodities Futures Trading Commission’s 2023 proposed guidance for voluntary carbon credit derivatives and the Securities and Exchange Commission’s final climate risk disclosure rule, which requires certain disclosures related to carbon offset purchases, in the Administration’s attention to and elevation of the voluntary carbon market as an important element in the nation’s climate policy. 

In this post, we dive deeper into the voluntary carbon market landscape, implications for business, and additional recent developments. Continue Reading Engaging in Voluntary Carbon Markets: Overview of Key Developments, Risks, and Opportunities

An additional piece of the section 30D puzzle arrived last Friday when the Department of the Treasury (Treasury) and Department of Energy (DOE) released final rules (Treasury Rule and DOE Rule).  Largely tracking the proposed regulations, which we described in our prior blog posts (here and here), but with notable changes, these rules provide further clarity to the electric vehicle sector, essential to foster the widespread EV adoption in the United States.Continue Reading Further Clarity to the Electric Vehicle Industry and Consumers Is Here, But It Is Not Done

First observed on April 22, 1970, Earth Day has long been recognized as a watershed moment for the modern environmental movement.  On that day, over 20 million demonstrators nationwide marched to raise awareness of the need to protect and preserve the environment.  The energy generated from that day galvanized the country to action, leading to the creation of the U.S. Environmental Protection Agency (EPA) in December 1970 and the passage of several statutes later that decade—including the Clean Air Act (CAA) the Clean Water Act (CWA), the Endangered Species Act (ESA), and the Resource Conservation and Recovery Act (RCRA)—that serve as the foundation of U.S. environmental legislation.  Today, Earth Day is recognized by countries around the world, and has expanded from its initial focus on pollution control to include elevating environmental justice in low-income, disadvantaged, and indigenous communities and promoting domestic and international climate action.

Beginning with a proclamation on April 19 declaring climate change to be “the existential crisis of our time,” the Biden-Harris Administration marked Earth Day and the week after by announcing a suite of final rules and grant programs aimed at fossil fuel abatement and pollution control, accelerating electric transmission grid modernization and solar energy development, and reducing greenhouse gas (GHG) emissions from the transportation sector.  These actions underscore not only the continued “whole-of-government” approach that the Administration has taken to combat climate change but also the urgency with which federal agencies have moved to promulgate final rules and protect them from potential congressional revocation ahead of the Congressional Review Act deadline later this spring. 

To assist industries and markets as they evaluate the impact of these final rules and programs, we’ve spotlighted several of these Earth Week regulatory and grant-funding actions.Continue Reading A Week of Climate Action: Spotlight on the Biden-Harris Administration’s Earth Week Regulatory and Grant-Funding Actions

What You Need to Know.

  • After two days of intense negotiations, world leaders adopted a draft decision that sets out international climate priorities in response to the findings of the first Global Stocktake under the Paris Agreement.  The decision covers several thematic areas, including mitigation of greenhouse gas emissions, adaptation and resilience in the face of climate change, financing and means of implementation and support for climate projects, and loss and damage funding for climate-vulnerable nations.  The text of the draft decision can be found on the UNFCCC’s website here.

Continue Reading COP28 Final Negotiations Recap: A Global Agreement to Transition Away from Fossil Fuels

What You Need to Know.

  • The thematic focus of the day’s programming was on nature, land use, and ocean, including events on scaling effective solutions that protect, restore, and beneficially manage nature ecosystems, addressing drivers of nature loss, empowering Indigenous Peoples and local communities, and creating resilient livelihoods.  As part of this discussion, the United Nations Environment Program (UNEP) launched a report highlighting that nearly $7 trillion of public and private finance each year supports activities that directly harm nature—thirty times the amount spent annually on “nature-based solutions,” or actions to protect, conserve, restore, sustainably use, and manage natural resources that simultaneously provide human well-being, ecosystem, and resilience and biodiversity benefits.

Continue Reading COP28 Day 9 Recap: Nature, Land Use, Oceans, and Nature-Based Solutions

On December 1, the Department of Energy (DOE) and the Department of the Treasury (Treasury) published highly-anticipated proposed rules that will significantly impact China’s and other covered nations’ roles in the battery supply chain for electric vehicles (EVs) sold to U.S. consumers.  The proposed DOE Interpretive Rules and proposed Treasury Regulations interpret the term “foreign entity of concern” (FEOC) in the same manner for purposes of the Battery Manufacturing and Recycling Grant program under the Bipartisan Infrastructure Law and the EV credit under section 30D of the Internal Revenue Code introduced by the Inflation Reduction Act (IRA).  The proposed rules take a more nuanced approach than the proposed and final rules that appeared in the context of the CHIPS and Science Act over the past year (discussed here, here, and here), but nevertheless purport to adopt bright-line rules.  As we have previously noted, adopting a different approach to such term in section 30D is justified to balance the IRA’s dual policy goals of onshoring and “friendshoring” the U.S. EV battery supply chain while making credits sufficiently available to accelerate the electrification of the U.S. consumer vehicle fleet.Continue Reading The Biden Administration Unveils the Long-Waited Guidance on “Foreign Entity of Concern”

What You Need to Know. 

  • After the opening day, action at COP28 shifted to the World Climate Action Summit (WCAS), where world leaders convened to deliver national statements and carry out initial negotiations on the Global Stocktake and expanding climate financing.  Concurrently, business leaders and philanthropists gathered at the Business and Philanthropy Climate Forum to discuss how the private sector and philanthropy can contribute to climate action.

Continue Reading COP28 Day 2­–­3 Recap: The World Climate Action Summit and Expanding Commitments to Climate Financing

What You Need to Know. 

  • After a year of preparation and months of anticipation, the twenty-eighth annual United Nations Conference of Parties to the United Nations Framework Convention on Climate Change (COP28) opened in Dubai on November 30, 2023.  Live and recorded coverage of the plenary sessions can be found on the UNFCCC COP28 website.
  • UN Climate Change Executive Secretary Simon Stiell opened the conference with a powerful call to action and reminder of what is at stake at COP28.  “Remember this.  Behind every line you work on.  Every word or comma you wrestle with here at COP.  There is a human being, a family, a community, that depends on you.  Turn the badge around your necks into a badge of honour, and a life belt for the millions of people you are working for.  Accelerate climate action.  Teach it to run.”
  • With a standing ovation from attendees, delegates approved the operationalization of a fund to assist developing countries in responding to economic and non-economic loss and damage associated with the adverse effects of climate change.  COP28 President Dr. Sultan Ahmed Al Jaber praised the approval of the loss and damage fund—the first time a decision has been adopted on the first day of any COP—as setting “a clear ambition for [delegates] to agree [to] a comprehensive, ambitious GST [Global Stocktake] decision over the next twelve days.”
  • The fund will initially be hosted by the World Bank for an interim period of four years, at which time an independent assessment of the World Bank’s performance as a host will be conducted.  World leaders must now nominate and appoint a board to operationalize the fund.  The UNFCCC also must formulate and post a final decision reflecting today’s approval.
  • Funding commitments for the loss and damage fund are mounting, with contributing countries facing a mix of peer pressure and political constraints.  National contribution pledges to date include: UAE ($100 million); UK ($51 million); US ($17.5 million); Japan ($10 million); European Union ($245 million, including $100 million pledged by Germany).

Continue Reading COP28 Day 1 Recap: A Call for Action and Historic Decision on Loss and Damage Funding

Laws and regulations that require companies, both private and public, to disclose their greenhouse gas (GHG) emissions continue to expand in the European Union and in the United States.  Under the EU Corporate Sustainability Reporting Directive (CSRD), beginning in 2025, EU-based public companies and large EU-based private companies will be required to report all material Scope 1, 2, and 3 GHG emissions as set forth in the European Sustainability Reporting Standards.  In the United States, California recently passed landmark climate-related disclosure legislation that will require U.S. companies that do business in California and have greater than $1 billion in annual revenues to file annual reports publicly disclosing their Scope 1 and 2 GHG emissions beginning in 2026 and Scope 3 GHG emissions in 2027.  This legislation is expected to be joined by the U.S. Securities and Exchange Commission’s (SEC) proposed climate-related disclosure rule.  Initially proposed in March 2022, if finalized, the SEC rule would require public companies to disclose their Scope 1 and Scope 2 emissions and material Scope 3 emissions.  And later this year, world policymakers, activists, and business leaders will convene at COP28 to discuss global progress towards achieving the net-zero GHG emissions targets set by the Paris Agreement.

The Greenhouse Gas Protocol (GHG Protocol) sits at the center of all these efforts.  Established by the World Resources Institute and the World Business Counsel for Sustainable Development in 2001, the GHG Protocol establishes comprehensive standards for private and public entities to calculate and report their GHG emissions and track progress towards their emissions targets.

Continue Reading Calculating and Reporting Greenhouse Gas Emissions: A Primer on the GHG Protocol