CLDP’s Energy Transition team provides legal technical support to governments grappling with the twin challenges of meeting national demand for reliable energy and mineral resources while advancing urgent climate and ESG priorities.

We advise ministries, regulators, and State Owned Entities (SOEs) on issues across the energy and minerals spectrum, including:

• Setting Sustainable Energy Policies: adopting policies and updating agreements in order to sunset carbon intensive (high-emission) power generation and energy infrastructure in a socially responsible manner or require or allow for fuel switching to a less carbon-intensive alternative, developing national or regional policies, strategies, frameworks and legal and regulatory structures to support emerging clean energy technology applications, such as hydrogen, other renewable fuels, and electric vehicles (including charging infrastructure).
• Reducing the Carbon Footprint of the Energy Sector: reducing the carbon footprint of upstream and midstream oil and gas projects, including reforms to meet the Global Methane Pledge; the use of carbon capture and sequestration (CCS), carbon offsets, and other tools; reforming SOEs’ missions and operations to be aligned with climate and ESG goals; and to leverage existing assets for energy transition infrastructure.
• Reforming Power Markets and Supporting Bankable, Sustainable Power Generation: structuring financeable low and zero-carbon power projects in accordance with international best practices, particularly in geothermal, hydrogen, solar, and wind; developing national and cross-border competitive, well-regulated power markets to catalyze private investment in renewable generation, transmission, distributed generation, and electric vehicles.
• Improving Mining Sector Governance to Catalyze Investment in Critical Minerals: advising on the legal and regulatory reforms to attract responsible investment in mineral extraction; sharing best practices with regulators; working with governments on developing country-wide and provincial investment frameworks for sustainable mining in key minerals such as lithium; and reducing the carbon footprint of mines and processing.
• Leveraging Markets for Meeting Climate Goals: adopting market mechanisms for climate financed projects in the energy and natural resources sectors, such as through carbon markets; ensuring there are firm legal and regulatory frameworks in place to attract climate finance within internationally recognized standards; and incorporating and managing climate risks through resource management planning, insurance and other tools.

CLDP is a partner implementer with Power Africa and Asia EDGE (Enhancing Development and Growth through Energy), the State Department’s Energy Minerals and Governance Program, and its Energy Resources Governance Initiative.

Facilitating the Energy Transition

Governments around the world confront the same challenge: how to manage the global transition to net-zero.  While the challenge is the same, each country faces its own unique set of obstacles, bottlenecks, decision points, and consequences to manage.  For example, countries that are existing petroleum producers can dramatically reduce their methane emissions.  Countries with aging state-owned thermal plants can reform to a competitive power market that would catalyze private financing of renewable generation.  Some countries will be the source of key metals and minerals, such as lithium, that will power the EVs and batteries of the future.  Most countries have opportunities in zero or carbon-negative technologies such as offshore wind, hydrogen, geothermal, and carbon capture.

CLDP advises governments on how to meet this challenge, given their respective circumstances.  We provide legal and regulatory technical assistance on how governments can adopt and enforce rules that will leverage private funds for public energy and mineral goods.  This includes technical assistance on how to sunset existing carbon intensive generation assets, reduce existing emissions, attract private investment into zero and carbon-negative technologies, unlock mineral resources sustainably, and develop market efficient “win-win” solutions that benefit the host country both economically and environmentally.

Climate finance is ultimately a grand bargain between the private and the public: investors expect an economic return and governments expect economic growth, and both expect projects to meet climate expectations.  CLDP helps governments understand and negotiate this grand bargain by setting in place a clear, reliable regulatory framework, durable contracts, competitive terms, significant institutional capacity, and transparent measurement and monitoring.  CLDP assists governments on the policies, laws, regulations, and contracts that enable climate-smart energy and mineral investments.

Decarbonization of Oil and Gas

CLDP works with governments to reduce the carbon footprint of their respective domestic oil and gas industry through clear regulatory reforms, implementation of ESG and climate disclosures, the prioritization of more carbon efficient fuels, and the participation of National Oil Companies (NOCs) in the transition to “NECs” (National Energy Companies), responsible for producing electrons and not just molecules.

The oil and gas industry will be a central player in the energy transition.  Oil and gas will continue to be produced for decades, even under the most ambitious net-zero plans; it remains a key source for energy access and security.  However, the way these resources are managed must evolve.  Within the industry, reducing the carbon footprint of oil and gas is not just feasible but necessary.  Companies can significantly reduce their carbon emissions per barrel (i.e., Scope 1 and 2 emissions), whether through direct regulation or performance-based mandates.  Companies can also use carbon offsets to reach a “net zero” position for the remaining emissions that are unavoidable.  Outside of the industry operations, governments will need to prepare for a future with progressively lower production and consumption of crude oil and natural gas.  This will require planning and adopting policies and legal reforms that ensure cleaner forms of energy are economically viable, and redirecting SOEs, namely NOCs and utilities.  The vast majority of today’s oil and natural gas is produced by NOCs.  NOCs have the opportunity to become NECs, and CLDP can help them do so.

Power

CLDP works with governments to successfully manage that transition to open market structures, working at both the policy and commercial level.  In the policy space, CLDP helps governments reconcile their overlapping roles as power market regulators, project partners, and power customers.

In recent decades, the traditional model of power infrastructure built around large-scale generation projects and expanding central transmission grids has given way to a more diverse market with smaller scale generators and more decentralized grids.  With the new climate urgency, CLDP can assist governments to consider alternative financings structures for much-needed transmission grade upgrades and/or construction to facilitate the introduction and integration of large amounts of renewable energy onto central transmission grids, incentivize the development of isolate, grid-connected, and grid-adjacent mini- and microgrids, and develop incentive structures to catalyze much-needed private investment in the renewable energy space.

As part of this assistance, CLDP has developed the "Understanding" series on power sector development, in partnership with stakeholders such as the African Legal Support Facility and under the aegis of USAID - Power Africa.  Following a collaborative method, the handbooks synthesize the insights and experiences of African governments, private sector experts, and multilateral institutions:

Understanding Power Purchase Agreements (2nd edition, 2019) in English and French

Understanding Power Project Financing (2016)

Understanding Power Project Procurement (2018)

Understanding Transmission Financing (2021)

Understanding Energy Storage (2022)

Mining and Mineral Security

A future powered by renewable resources – and the global economy, more generally – are dependent on the reliable supply of metals and minerals.  Although many countries are endowed with significant deposits, governments are challenged to manage their development — how to incentivize investment and ensure environmental and social oversight.  In 2021, the U.S. State Department, Bureau of Energy Resources launched its Energy Minerals and Governance Program (EMGP) to promote resilient and secure energy resource mineral supply chains for the United States and its partners.  Under the aegis of EMGP, CLDP provides assistance to governments to develop national and provincial investment frameworks for sustainable mining in key minerals.  CLDP advises on best principles in mineral extraction governance and best practices for regulators and assists in the development of regulations that promote transparent, competitive, and sustainable mining.