Guest Post: COVID-19 in North Carolina: Practical Mitigation for the Renewable Energy Industry

To our fellow NCSEA members:

We hope you are safe and well during this challenging time. As you are aware, Governor Cooper’s statewide Stay at Home Order (Executive Order 121) takes effect at 5pm today, lasting through April 29.

First and foremost, our collective priority is, and should remain, human health and safety. As local, state, and federal government take action to help limit the
spread of COVID-19, we are monitoring the rapid developments of this
fast-moving news cycle and COVID-19’s impacts on renewable energy markets.

Many open questions remain regarding the impact of COVID-19 in North Carolina – particularly the impact on businesses. The renewable energy industry is no exception. Although the full impacts will not be known for some time, we can consider some practical mitigation efforts now:

• North Carolina’s Stay at Home Order considers energy – and construction – within COVID-19 Essential Businesses and Operations. However, businesses must still direct employees to work from home or telework to the maximum extent possible. Employers should assess their human resources policies and applicable laws to determine the most appropriate arrangement for business continuity during this time.

• Under the Stay at Home Order, operation of existing plants, and even construction of new projects, may continue. Employers evaluating the risk of continued performance should assess whether they can maintain social distancing of at least six (6) feet between people and ensure social distancing policies are clearly communicated and enforced.

• Where performance can continue, employers should consider providing appropriate guidance to contractual counterparties in compliance with the Stay at Home Order. Employers should also consider issuing “safe passage” letters to essential employees, providing documentation that may be used in the event requested by law enforcement.

• Many agreements contain force majeure, material adverse change, or excusable event provisions. Especially in relation to project agreements – power purchase agreements, membership interest purchase and sale agreements, engineering, procurement, and construction agreements, and operation and maintenance agreements – which may experience disruption caused by COVID-19, businesses should review and comply with agreement provisions (especially notice provisions) which may relieve performance obligations impacted by COVID-19.

• Some businesses maintain business interruption insurance, which may be adjacent to commercial property insurance. Even before the duration and extent of COVID-19 impacts are known, businesses should review their existing insurance policies to understand whether coverage may be available – and if so, where and how to provide appropriate notice to the insurer.

Of course, the business environment is and will continue to rapidly evolve, based on the extent of spread of COVID-19 and public health measures.

As we stay at home and evaluate an unknown future, we remain hopeful and optimistic. Over the last decade, the renewable energy industry in North Carolina and beyond has exceeded all expectations. It is a privilege to be a part of this industry and to witness firsthand the progress seen from this industry’s innovation and entrepreneurship. This industry has some of the most intelligent and talented leaders pioneering our renewable energy economy – and with hardship comes opportunity. During these uncertain times, we will be here alongside you, and we look forward to working with you through the opportunities to come.