Renewable Energy 2020 Energy Renewable Renewable Energy 2020 Contributing editor Eric Pogue Hunton Andrews Kurth LLP © Law Business Research 2019 © Law Business Research 2019 Publisher Tom Barnes [email protected] Subscriptions Claire Bagnall Renewable Energy [email protected] Senior business development managers Adam Sargent 2020 [email protected] Dan White [email protected] Contributing editor Published by Law Business Research Ltd Eric Pogue Meridian House, 34-35 Farringdon Street Hunton Andrews Kurth LLP London, EC4A 4HL, UK Tel: +44 20 3780 4147 Fax: +44 20 7229 6910 The information provided in this publication is general and may not apply in a specific Lexology Getting The Deal Through is delighted to publish the third edition of Renewable Energy, situation. Legal advice should always which is available in print and online at www.lexology.com/gtdt. be sought before taking any legal action Lexology Getting The Deal Through provides international expert analysis in key areas of based on the information provided. This law, practice and regulation for corporate counsel, cross-border legal practitioners, and company information is not intended to create, nor directors and officers. does receipt of it constitute, a lawyer– Throughout this edition, and following the unique Lexology Getting The Deal Through format, client relationship. The publishers and the same key questions are answered by leading practitioners in each of the jurisdictions featured. authors accept no responsibility for any Lexology Getting The Deal Through titles are published annually in print. Please ensure you acts or omissions contained herein. The information provided was verified between are referring to the latest edition or to the online version at www.lexology.com/gtdt. July and August 2019. Be advised that this Every effort has been made to cover all matters of concern to readers. However, specific is a developing area. legal advice should always be sought from experienced local advisers. Lexology Getting The Deal Through gratefully acknowledges the efforts of all the contribu- © Law Business Research Ltd 2019 tors to this volume, who were chosen for their recognised expertise. We also extend special No photocopying without a CLA licence. thanks to the contributing editor, Eric Pogue of Hunton Andrews Kurth LLP, for his continued First published 2017 assistance with this volume. Third edition ISBN 978-1-83862-152-0 Printed and distributed by Encompass Print Solutions Tel: 0844 2480 112 London August 2019 Reproduced with permission from Law Business Research Ltd This article was first published in September 2019 For further information please contact [email protected] www.lexology.com/gtdt 1 © Law Business Research 2019 Contents Global overview 3 Korea 56 Eric Pogue and Mike Klaus Hoon Lee and Pan-Soo Kim Hunton Andrews Kurth LLP Jipyong The global trend of offshore wind energy 5 Mexico 63 Lauren A Bachtel Rogelio López-Velarde, Amanda Valdez and Daniela Monroy Hunton Andrews Kurth Dentons López Velarde SC Brazil 7 Nepal 70 Fabiano Ricardo Luz de Brito, Giovani Loss, Pablo Sorj, Mahesh Kumar Thapa Sinha Verma Law Concern Marina Anselmo Schneider and Ana Carolina Calil Ryan T Ketchum Hunton Andrews Kurth LLP Mattos Filho, Veiga Filho, Marrey Jr e Quiroga Advogados Nigeria 74 Chile 14 Ike C Ibeku and Ifeyinwa Ufondu Felipe Bahamondez Prieto, Paulina Farías Castro and Benchmac & Ince Diego Peña Diez DLA Piper Chile Spain 83 Gonzalo Olivera and Alberto Artés Egypt 21 King & Wood Mallesons Donia El-Mazghouny Shahid Law Firm Taiwan 91 Grace Chih-Wen Chou and Sean Yu-Shao Liu Ethiopia 26 Lee, Tsai & Partners Attorneys-at-Law Mahlet Kassa Woldesenbet LLP Lidet Abebe Tizazu Law Office Ryan T Ketchum Hunton Andrews Kurth Tanzania 98 Nicholas Zervos, Clara Mramba and Seif Ngalinda Germany 30 VELMA Law Christine Bader and F Maximilian Boemke Watson Farley & Williams LLP Turkey 105 Mehmet Feridun İzgi India 36 Fırat İzgi Avukatlık Ortaklığı/Fırat İzgi Attorney Partnership Dibyanshu, Prateek Bhandari and Shikha Rastogi Khaitan & Co Ukraine 115 Igor Dykunskyy and Yaroslav Anikeev Iran 44 DLF Attorneys-at-Law Behnam Khatami, Masoomeh Salimi, Niloofar Massihi and Farzaneh Montakhab United Kingdom 125 Sabeti & Khatami John Dewar and Seyda Duman Milbank, Tweed, Hadley & McCloy LLP Japan 50 Norio Maeda, Amane Kawamoto, Keisuke Yonamine, Kentaro Moriya, United States 133 Yuto Tokoro and Yooya Jung Mike Klaus, Jeff Schroeder, Eric Pogue and Laura Jones Nishimura & Asahi Hunton Andrews Kurth LLP 2 Renewable Energy 2020 © Law Business Research 2019 Ethiopia Mahlet Kassa Woldesenbet LLP Lidet Abebe Tizazu Law Office Ryan T Ketchum Hunton Andrews Kurth MARKET FRAMEWORK Definition of ‘renewable energy’ 3 Is there any legal definition of what constitutes ‘renewable Government electricity participants energy’ or ‘clean power’ (or their equivalents) in your 1 Who are the principal government participants in the jurisdiction? electricity sector? What roles do they perform in relation to renewable energy? No. Government policy in respect of the electricity sector is established by Framework the Ministry of Water, Irrigation and Electricity. The electricity sector 4 What is the legal and regulatory framework applicable to is regulated by the Ethiopian Energy Authority (EEA), which is an inde- developing, financing, operating and selling power and pendent regulatory authority vested with the power to issue licences ‘environmental attributes’ from renewable energy projects? for the generation, transmission, and distribution of electricity within Ethiopia as well as the import and export of electricity into and out of the The EEA is responsible for issuing generation licences, and would, in country. Ethiopian Electric Power (EEP) is responsible for the genera- the case of an IPP, authorise the project company to generate electricity tion and transmission of electricity. The Ethiopian Electric Utility (EEU) from a particular generation facility. Given that EEP is responsible for purchases capacity and energy from EEP and distributes electricity to generating (or procuring the generation of) electricity in Ethiopia and end users. Both EEP and EEU are public enterprises. They are wholly that EEU has a monopoly over the distribution of electricity to end users, owned by the government of Ethiopia and governed by regulations any IPP seeking to develop a project in Ethiopia would need to enter into issued by the Council of Ministers. a Power Purchase Agreement with EEP. The foregoing applies to renew- The majority of the energy generated by EEP is generated from able and non-renewable projects alike. There is no legal or regulatory hydroelectric resources. A relatively small percentage of power is framework for selling environmental attributes from renewable energy generated from wind, geothermal and thermal sources. projects, but the high cost of electricity in Sub-Saharan Africa in general and Ethiopia in particular means that renewable projects have a much Private electricity participants easier time achieving grid parity than they would in other markets with 2 Who are the principal private participants in the electricity lower electricity prices. sector? What roles do they serve in relation to renewable The following is a list of the principal legislation governing the energy? development of energy in Ethiopia: • Energy Proclamation No. 813/2013 (revised but not published); Although no independent power production (IPP) project has yet • Ethiopian Energy Authority Establishment Council of Ministers achieved financial close in Ethiopia, Ethiopia has recently determined Regulation No. 308/2014 (this Regulation is currently under review that it should, as a matter of policy, use what limited financial resources and will likely be amended); it has available for the development of infrastructure to develop • Electricity Operations Council of Ministers Regulations No. 49/1999 infrastructure in other sectors that are not as capable of generating (under revision); self-sustaining revenues the electricity sector. As a result, Ethiopia has, • Geothermal Resources Development Proclamation 981/2016; over the past few years, begun to examine the legal and regulatory • Investment Proclamation No. 769/2012 as amended; framework in the country in order to: • Investment Incentives and Investment Areas Reserved for • determine whether it is capable of supporting an IPP programme; Domestic Investors Council of Ministers Regulations No. 270/2012 • identify any changes that should be made to the legal and regula- as amended; tory framework to facilitate the development of a successful IPP • the Constitution of the Federal Democratic and Republic of Ethiopia; programme; and • the 1960 Federal Democratic Republic of Ethiopia Civil Code; • consider how best to approach the development of such a • Environmental Protection Authority Establishment Proclamation programme. No. 9/1995m as amended; • Environmental Impact Assessment Proclamation No. 299/2002; and In part as a result of these efforts, EEP recently entered into two power • National Bank Directives. purchase agreements under which two geothermal power plants will be developed. Foreign banks can lend to an Ethiopian incorporated company only if they obtain an authorisation from the National Bank of Ethiopia, where the Ethiopian company cannot find adequate funding from Ethiopian banks. The authorisation by the company in Ethiopia to borrow money 26 Renewable Energy 2020 ©