In 2001, Jones Day became one of the first law firms to establish a global, multidisciplinary team of attorneys dedicated to counseling clients on climate change issues. We have been at the forefront in devising programs under the EU Emissions Trading Scheme, and the UK Emissions Trading Scheme, as well as under recently enacted U.S. initiatives such as California's landmark greenhouse gas legislation (AB 32) and the Regional Greenhouse Gas Initiative in the Northeastern and Mid-Atlantic United States. Over the last eight years, clients have also sought our advice in evaluating numerous emissions reduction projects being developed in Europe, Latin America and Asia under the Clean Development Mechanism ("CDM") established under the Kyoto Protocol. Our extensive work on these projects and other mechanisms to regulate greenhouse gas emissions has given us, and our clients, valuable insights in structuring the complex trading transactions in existing and emerging markets.
A Global, Multidisciplinary Approach
Because the legal and business implications of climate change regulation are as diverse as our client base, Jones Day has developed a deep, multidisciplinary team of attorneys to help clients around the world anticipate, shape and respond to emerging climate change initiatives. Understanding how these initiatives will impact a client's business requires specialized legal analysis in a variety of areas. We draw upon attorneys in our Environmental, Health & Safety, Energy, Mergers & Acquisitions, Project Finance, Capital Markets, Tax, Real Estate, Construction, Intellectual Property, and Trial practices, and with other required competencies for each engagement. Our "One Firm" approach to delivering the full range of legal services has never been more valuable than in helping our clients manage the myriad effects of climate change regulation.
Distinctive Engagements
The following is a selection of our recent significant representations in the areas of emissions reduction and trading, renewable energy projects, and climate change litigation:
Emissions Reductions and Trading
The landscape for investments in a low-carbon economy is global and multi-faceted. Investment options will likely increase in the years ahead as more countries, including the United States, move to establish carbon reduction schemes. Our recent engagements in this area include the following:
Rhodia Energy Services
We advised Rhodia Energy Services, a subsidiary of the Rhodia Group, on one of the most important private transactions for the implementation of CDMs performed since the Kyoto Protocol went into effect. The complexity of the transaction was notably related to the legal and tax structuring of the project, the creation of a joint venture with Société Générale Energie for the trading of Certified Emission Rights ("CERs"), and the sale of one of the largest volumes of CERs ever sold to investors.
Rhodia Organique Fine Limited
Jones Day advised Rhodia Organique Fine Limited, one of the majority participants in the U.K. Emissions Trading Scheme ("UK-ETS"), the world's first major greenhouse gas emissions trading system. We assisted Rhodia both during and after the initial auction with the impact of the detailed legal rules under the UK-ETS in light of various strategic options then under consideration by management. We also provided strategic and compliance advice regarding the sale of Montreal Protocol "production" and "sales" rights, including overlap with the UK-ETS in respect of HFC/HCFC production in the U.K.
AgCert International
We represented AgCert International, a leader in the production and sale of agriculturally derived GHG emissions reductions, in its flotation on the London Stock Exchange to carry out international CDM projects in the agricultural sector.
ENDESA Generación
We provided legal advice on different aspects of the implementation of the Kyoto Protocol with respect to CO2 capture and confinement.
ECCO Asset Incorporated
We provided legal advice with respect to three CDM projects in China.
UK-ETS
Our lawyers advised on one of the first forward contracts for the sale of credits under the UK-ETS.
SOx and NOx trading schemes in the U.S.
We have represented, and are continuing to represent, clients in the banking and trading of NOx emissions reduction credits under state (U.S.) emission credit trading programs. Using our knowledge of developing SOx and NOx trading schemes in the U.S., we consulted with multiple stakeholders, including the U.K. government, on Renewable Obligations Certificates, Renewable Energy Credits ("RECs"), and carbon emissions trading, as well as the opportunities and risks presented by these markets.
Reforestation
We are representing a client in the United States in the drafting and negotiation of an agreement for the reforestation of state-owned lands for the purpose of earning carbon sequestration and other greenhouse gas credits available under current and future mandatory and voluntary greenhouse gas reduction programs.
CER Contracts and Implementation by Subject Companies of EU Climate Change Obligations
We provide legal advice on the negotiation and drafting of CER contracts, as well as on regulatory issues in connection with the implementation of the Kyoto Protocol obligations in Europe.
Renewable Energy Projects
Jones Day has long been recognized as having one of the leading global renewable energy practices. We represent lenders, developers, investors and energy purchasers in renewable projects, and have years of experience in the monetization of the tax incentives and environmental attributes these projects generate. Recent engagements in this area include the following:
Banco Bilbao Vizcaya Argentaria, S.A.
We advised a syndicate of banks led by Banco Bilbao Vizcaya Argentaria, S.A., in connection with the €443 million financing of the construction and development of 11 wind parks located in Spain with a total generating capacity of 2,956 MW.
Banco Santander et al./Nevada Solar One
We represented Banco Santander in connection with the $296 million leveraged lease financing of the 64 MW Nevada Solar One thermal solar electric generating facility located in Boulder City, Nevada, developed by Acciona Energía, S.A. This was the first leveraged lease financing of a concentrated solar power plant in the United States.
Calyon and Société Générale
We advised a syndicate of banks led by Calyon, S.A., and Société Générale, S.A., in connection with the financing of the construction and operation of a 475 MW thermal solar plant located in Aîn Béni Mathar (Morocco), built by the Spanish company Abener for the Algerian state-owned Office National d'Electricité (ONE).
Developers Diversified Realty Corporation/SunEdison
We assisted DDR, a publicly traded real estate investment trust, in establishing a solar energy program with SunEdison, North America's largest solar energy services provider, to develop and install photovoltaic solar energy systems at hundreds of shopping centers in the United States and Puerto Rico.
Xcel Energy
We advised Xcel Energy on the acquisition by its subsidiary, Northern States Power Company – Minnesota, from enXco of a proposed 201 MW wind power projects in Minnesota and a proposed 150 MW wind power project in North Dakota, contemplating a total investment by NSP of approximately $900 million.
Climate Change Litigation
"Chambers USA 2008 cites Jones Day's Climate Change Litigation Practice as being 'out in front' of others in this emerging area of law."
In the absence of a federal scheme for emission controls of greenhouse gases in the U.S., some states and private parties have filed lawsuits alleging that such emissions are a public nuisance that causes a variety of compensable damages. To date, three such lawsuits have been filed. Jones Day has a lead role in each of these pending cases: State of Connecticut, et al. v. American Electric Power Company, Inc., et al., No. 05-5104-cv (2d Cir.); Ned Comer, et al. v. Murphy Oil USA, et al., No. 1:05-cv-00436 (5th Cir.); and Native Village of Kivalina, et al. v. ExxonMobil Corp., et al., No. 1138 (N.D. Cal.).
More climate change litigation is expected. The United Nations Intergovernmental Panel on Climate Change reports doubtless will be used by future plaintiffs wishing to bring climate change lawsuits seeking redress for personal injury and property damage. To prevail on such claims, plaintiffs and their scientists must demonstrate not only that the earth has warmed, but also that the climate effects complained of are tied to defendants' activities, as the concept of "specific causation" is well settled in law. Jones Day's lawyers are at the forefront of the complex scientific and evidentiary issues related to climate change litigation and specific causation.