The war in Ukraine has hit the energy sector and destabilized the transition to carbon-free energy. At the same time, investors increasingly require that their investments go toward environmental, social and governance ends. Reverberations of COVID-19 include an expansion of nonperformance in energy-related contracts, and we expect to see new kinds of litigation around that.
Reed Smith lawyers and a Eurasia Group executive contribute these and other insights to give you an updated picture of a rapidly evolving situation. The report outlines key themes discussed at Reed Smith’s flagship Energy & Commodities Conference held in Houston on March 31. Read the report and reach out to our authors to discuss what these issues mean to you and your enterprise.
Among the report’s topics and key takeaways:
Ukraine war reshapes energy geopolitics and decarbonization
Key takeaways:
- Russia’s aggression is causing Europe to relook elsewhere for gas imports
- Opportunities open up for LNG exporters
- Boycotts might speed up adoption of renewables
Worldwide coordination: The key to success on achieving carbon neutrality
Key takeaways:
- The transition to a carbon-neutral economy will require energy producers, policymakers and customers to coordinate market developments
- A clear regulatory framework is required to support infrastructure investments
- The energy transition is a great opportunity, and a global imperative, which will require an “all-tools-in-the-box” approach to be successful
SEC policy shift expected to increase power of shareholders moving for action on ESG
Key takeaways:
- Policies that thwarted shareholder ESG proposals reversed
- New policies protecting socially responsible initiatives are being implemented
- Broad-scope issues like climate change may be included alongside core business activity
- Concept of shareholder micromanagement narrowed
Regulatory and enforcement trends at the CFTC and FERC: Spring 2022
Key takeaways:
- FERC now has a full quorum; imposes big enforcement fines
- Appeals court reverses FERC orders restricting gas pipelines
- FERC seeks tougher reliability standards for critical infrastructure
- CFTC pursues greater control over digital asset trading platforms
- Full quorum of CFTC commissioners expected soon
Litigation risk management in cross-border disputes and force majeure
Key takeaways:
- The pandemic has created difficult legal issues, particularly in foreign trade
- Application of civil law – prevalent in Latin America – may have serious implications in force majeure claims
- Proactivity is required to defend against force majeure claims
