Mintz Levin Energy Technology

Energy Technology Connections Newsletter

Your Law Firm Link to Industry News

June 2015

A Note from the Editors

Our June edition of Energy Technology Connections brings you recent industry highlights, the latest news from Capitol Hill, and a list of upcoming energy industry events. In Leaders in the News, we highlight nano-structure steel material developer NanoSteel for recently securing a significant loan venture facility, WeSpire’s Susan Hunt Stevens for winning an EY Entrepreneur of the Year award, and our own Tom Burton and Sahir Surmeli for making Wunder Capital’s #cleantech 100 on Twitter. This month’s Innovator Profile features Gotham Greens, a company bringing sustainable agriculture to the rooftops of New York City and beyond. In Event Highlights, we look at our Energy Tech Practice’s recent 10-year anniversary celebration. Finally, our Washington Update provides the latest on the House and Senate’s separate comprehensive energy bills and the latest on the EPA’s Clean Power Plan.

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Contents

Leaders in the News

Congratulations to our client, NanoSteel, for receiving a $10 million venture loan facility from Horizon Technology Finance to support the continued development and commercialization of NanoSteel’s advanced portfolio of patented steel alloys. NanoSteel is a privately held company founded in 2002 as a spinoff of the US Department of Energy’s Idaho National Laboratory. The company specializes in the design and commercialization of steels with exceptional mechanical properties derived from their nano-scale microstructure.

At the beginning of June, with the help of a dedicated Mintz Levin team, NanoSteel secured $10 million in funding to go towards general working capital purposes — a deal that represents a significant accomplishment for the company. David Paratore, President and Chief Executive Officer of NanoSteel, stated, “We welcome the financial partnership of Horizon, an experienced venture lender with a strong balance sheet and long track record of supporting dynamic growth-oriented companies, such as ours. Horizon’s $10 million venture loan facility provides us with growth capital to achieve near-term commercial scale and product qualification milestones.” NanoSteel focuses primarily on proprietary alloys for use as sheet steel in automotive lightweighting applications and metal powder for 3D printing of industrial parts. Since its founding in 2002, NanoSteel has developed multiple generations of ferrous materials innovations including metallic coatings, powders, and sheet steel protected by over 400 patents filed or granted worldwide. For more information on NanoSteel and its continued success, please visit its website.

Also in the news, our client Susan Hunt Stevens, CEO and Founder of WeSpire, received the EY Entrepreneur Of The Year 2015 Award in the “Emerging” category in New England. The award recognizes outstanding entrepreneurs who demonstrate excellence and extraordinary success in such areas as innovation, financial performance, and personal commitment to their businesses and communities. At WeSpire, Susan and her team have done just that, as their employee engagement platform encourages action across corporate sustainability, social responsibility, and well-being programs. Upon receipt of the award, Susan said, “Being recognized by EY and earning this award is a big deal. We are here because we believe business can change the world for the better and I am grateful to be part of it.” Congrats to Susan and the entire WeSpire team!

Finally, congratulations to our Practice Chair Tom Burton and Co-chair Sahir Surmeli, for making Wunder Capital’s list of The 100 People Shaping #Cleantech on Twitter! Tom and Sa both met the stringent criteria stipulating that, among other things, the majority of their tweets and at least 50% of their work pertains to the clean-tech field. Tom was featured with “the thinkers…responsible for asking the right questions — and finding the right answers,” while Sa shares company with “the doers,” working the industry’s trenches. Don’t miss out — to find out all the latest on clean energy and technology, be sure to follow Tom (@tomburtonIII) and Sa (@energycleantech) right now!

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Innovator Profile

This month we’re featuring Gotham Greens, a Brooklyn-based urban agriculture company that designs, builds, and operates commercial-scale greenhouse facilities for fresh vegetable production. Founded in 2011, Gotham Greens quickly became a global urban agriculture leader and one of New York State’s leading producers of premium-quality, greenhouse-grown vegetables and herbs. Through innovative and sustainable methods, Gotham Greens grows delicious varieties of lettuce and tomatoes right in New York City, and soon, Chicago! Gotham Greens has built over 95,000 square feet of rooftop greenhouse facilities in New York City and an additional 75,000 square feet in Chicago, with several other projects under development.

Gotham Greens approaches farming in ways that are not just sustainable, but that are specifically tailored to their unique locations. Gotham Greens’ greenhouses use a sophisticated computer system to give farmers total control over the growing environment. This system also prioritizes preserving water and energy efficiency. Employing hydroponics, the greenhouses effectively re-circulate water without harmful soil erosion. Environmental control systems, advanced thermal design features, and onsite renewable energy sources help farmers conserve valuable energy.

Both Gotham Greens’ cutting-edge techniques and delicious products have received consistent acclaim. The company was a grand prize winner of the New York Green Business Competition, winner of an Environmental Excellence Award from the New York Department of State, and the 2013 Brooklyn Chamber of Commerce Made in Brooklyn Award winner. Just last month, Gotham Greens was featured in Edible Brooklyn’s 2015 Innovation Issue and appeared on a segment of Food Network star Justin Warner’s hit show, Foodie Call. For a list of where to find Gotham Greens’ products, click here. Congratulations and keep up the good work!

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Event Highlights

Our practice recently celebrated our 10-year anniversary at District Hall in Boston. To mark over a decade of helping energy innovators succeed, our Energy Technology Practice Group would like to thank our more than 250 clients nationwide for aiding in our success. For a recap of this event, including photos, view our blog post here.

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Washington Update

The House and Senate are in session until the July 4 recess, and have full schedules until then. House Majority Leader Kevin McCarthy (R-CA) has outlined additional June issues to include agricultural legislation, Affordable Care Act measures, and Environmental Protection Agency regulations. EPA regulations specifically include legislation allowing states to opt out or defer compliance with the Clean Power Plan (H.R. 2042), to address coal ash (H.R. 1734), and to modernize the Toxic Substances Control Act (H.R. 2576).

During a June 2 House Energy and Commerce Subcommittee on Energy and Power hearing, full committee Chair Fred Upton (R-MI) said that the committee should consider legislation this year to end the 40-year crude oil export ban. The lower chamber’s broad energy package does not currently include such a measure, but Representative Upton hopes to work with Subcommittee Chair Ed Whitfield (R-KY) and others to add language to the legislation.

The Western Governors’ Association endorsed legislation (H.R. 1734) on May 15 that would allow states to draft, implement, and enforce their own permitting programs for coal ash management and disposal. The House is likely to consider the measure from Representative David McKinley (R-WV) before the August recess. Senator John Hoeven (R-ND) is considering a Senate version of the measure, but has not yet introduced legislation. Also in the House, The House Energy and Commerce Subcommittee on Energy and Power released on May 19 draft legislation that would require the Department of Energy to expedite its approval process for liquefied natural gas export projects and would state that cross-border energy projects will not require a presidential permit for construction. The measure, which was considered during a May 21 hearing, will be incorporated into a broad energy package that the full committee is preparing.

In the Senate, Senators Sheldon Whitehouse (D-RI) and Brian Schatz (D-HI) announced carbon fee legislation at a June 10 event at the American Enterprise Institute. Senator Whitehouse hopes this bill introduction will encourage serious debate over how best to address climate change. He introduced legislation late last year that would require large greenhouse gas emitters to pay a $42 fee for every ton of emitted CO2; the collected revenue would then be returned to taxpayers through economic assistance to low-income families, tax cuts, and infrastructure investments. Senator Lamar Alexander (R-TN) said on June 5 that he is confident that Senate Majority Leader Mitch McConnell (R-KY) will bring the $35.4 billion energy and water spending bill (H.R. 2028) to the floor before the August recess, despite threats by Senate Democrats to block the measure over a funding level dispute. On May 21, the Senate Appropriations Committee approved the bill that would provide $29.4 billion for the Department of Energy, $5.5 billion for the US Army Corps of Engineers, and $1.1 billion for the Interior Department’s Bureau of Reclamation.

On the administration side, the Environmental Protection Agency sent its final Clean Power Plan to the White House Office of Management and Budget for interagency review on June 3. The agency is expected to release final greenhouse gas standards for new, existing, and modified power plants in August. OMB is also reviewing the agency’s final new source performance standards for new power plants. On May 20, the White House released a report on the National Security Implications of a Changing Climate. The same day, during his commencement address at the US Coast Guard Academy, President Obama said that climate change poses a significant threat to national and global security and that it will impact how the American military defends the United States.

The DOE’s Energy Information Administration released an analysis on May 22 of the Environmental Protection Agency’s Clean Power Plan. The report predicts that under the plan, 90 GW of coal capacity will retire by 2040, an increase from the 40 GW projected under current regulations. The report estimates natural gas utilization capacity to peak at 57% in 2020, and forecasts that energy efficiency and renewable energy will dominate state compliance strategies after an initial period of high natural gas use. The report forecasts that the plan will result in a power sector CO2 emissions reduction of between 29% and 36% from 2005 levels, in line with the Environmental Protection Agency’s own projections.

At the Interior Department, the Bureau of Ocean Energy Management granted a conditional approval on May 11 to Royal Dutch Shell to explore for oil this summer in the Chukchi Sea. Shell must still obtain a drilling permit from the Bureau of Safety and Environmental Enforcement and state regulatory clearance. In response, Senator Chuck Schumer (D-NY) led 17 of his colleagues on May 22 in sending a letter to Interior Secretary Sally Jewell asking the administration to stop the approval process to allow Royal Dutch Shell Plc to explore for oil in Alaska’s Chukchi Sea this summer, as well as to halt all other oil and gas drilling permits in the Arctic region. The group contends that the Bureau of Ocean Energy Management did not fully account for the likelihood of oil spills and their environmental impact when it issued a conditional approval earlier in the month.

Speaking at the 2015 Ceres conference on May 14, Environmental Protection Agency Administrator Gina McCarthy urged businesses to continue promoting the economic benefits of addressing climate change. Members of the conference recently sent a letter supporting the agency’s Clean Power Plan. That same day, Bank of America Merrill Lynch announced that clean energy and climate change represent billions of dollars in potential capital; the bank initially set a $20 billion goal, but achieving it four years ahead of schedule, increased the lending, investing, and other support goal to $50 billion. The bank issued a second $600 million green bond on May 14, after becoming the first corporate green bond issuer in the country last year. The EPA also released a study on June 4 finding that fracking does not have a widespread impact on drinking water. The study provides extensive detail on the potential of pollution and provides examples of definite contamination cases, but finds that they are relatively limited.

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