As a sponsor of the event, Foley was well represented by team members from its Washington, D.C., Milwaukee, Madison, and Denver offices. Attendees included Adam Schurle, John Dunlap, Senayt Rahwa, Darin Lowder, Scott Johnson, Sunita Paknikar, Tori Roessler, Joel Meister, Sadie Olson, Rocio Portela-Berrios, Calkie Fisseha, Jake Balducci, and Trey Wolf.  Foley also hosted its annual reception on November 6, welcoming clients and industry friends to its office on the iconic Georgetown waterfront.

Foley partner Adam Schurle moderated the 鈥淭ax Issues鈥� panel, which addressed the implications of the OBBBA on eligibility for renewable energy tax credits. Panelists included Reunion, Aon, WTW, Crux Climate and others to discuss updates to the 鈥渂eginning of construction鈥� qualifications, FEOC rules, and how financing parties and insurance providers, among others, are responding to these regulatory changes.

The conference featured policy updates from industry and trade association leaders, highlighting trends in clean energy and recent federal policy developments impacting the industry. Additional panels explored how investors, developers, and stakeholders are adapting business strategies in response to evolving policies and financing requirements 鈥� from debt and tax equity to tax credit transfers.  Many of these topics have also been explored in detail in Foley鈥檚 energy industry podcast, Powered by Foley.

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On the Powered podcast, Foley鈥檚 Energy Team will bring you the key issues of the day in the energy and infrastructure sector, the people making projects and deals move forward, and put it all into perspective so you鈥檙e ready to tackle tomorrow.

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The Trade-Secret Threat Landscape Has Shifted

Remote work, the rise of AI, and talent migration across energy sectors have transformed not only how we operate, but how sensitive information is shared, stored, and used. AI tools are helpful, but risky.  Many common platforms openly state that the information entered into the system is not secure鈥攊t is reviewed by humans to help train the AI systems, it is stored and retained for training and analysis, and it is not encrypted.  This insecure environment creates access points for bad actors seeking valuable information. 

AI and machine learning tools are deeply embedded in daily energy operations. From predictive maintenance to drilling or turbine optimization, or from demand forecasting to energy trading algorithms, AI plays a robust role in daily operations.  These tools are frequently stored in the cloud where even the best ecosystems have exposure risks. 

Employee mobility has increased since remote work took hold鈥攚orkers are no longer limiting their employment options by the length of their commute, making it easier to transition between roles.  Specialists in drilling analytics, geoscience, hydrogen, and renewable technologies are in high demand, with skills often transferable across sectors. Departing employees may intentionally or inadvertently take proprietary information with them. Some may believe the work they created is theirs to keep, unaware that any work product belongs exclusively to the employer. In fact, employees 鈥� not outside hackers 鈥� are the most common source of intellectual property loss.

Industry collaboration is equally a double鈥慹dged sword. Joint ventures and contractor relationships can accelerate innovation, but they also increase risk. At the end of a project, proprietary data can become the subject of disputes 鈥� or, in worse cases, continue to be used by a former partner after the relationship has ended.

The common thread: most trade鈥憇ecret misappropriation happens inside the ordinary course of business, not in the shadows of external attacks. 

Turn Awareness to Action.

Trade secrets only drive value when they are used 鈥� but use increases exposure. The key is to protect without stifling operations. Four steps can help:

First, map what matters. What actually qualifies as a trade secret varies from business to business.  Identify categories of critical information and pinpoint where it is stored to assess existing protections and fortify weaknesses. 

Next, control access. Disclose sensitive information on a need to know basis.  Use password protections and segment access across the company to limit access. Control the electronic environment as well鈥攗se a VPN and limit the use of external hard drives, personal email accounts, and unauthorized file transfer services.  Conduct regular review and patch vulnerabilities before they are exposed. 

Third, double check the fine print.  Ensure that NDAs, joint venture agreements and project contracts are current and robust. Joint venture or project contracts should clearly define IP ownership from the outset and address data return or destruction at the conclusion of the project.  The documents should also provide a remedy for breach鈥攅nsure that emergency relief petitions like injunction applications are permitted and that contracts with foreign partners select a choice of law in a jurisdiction with meaningful IP protections.  

Finally, manage employee education and transitions effectively.  It is not enough to have employees sign an NDA the day they join the company.  Foster a culture of confidentiality by explaining obligations during onboarding and providing regular reminders and training throughout employment.  When employees leave, clearly explain the company鈥檚 exclusive ownership rights and give them a chance to admit a mistake and return sensitive information before issues escalate. 

Conclusion

The energy industry鈥檚 rapid evolution brings extraordinary opportunities for development, collaboration, and change 鈥� but these same forces create fertile ground for trade鈥憇ecret misappropriation. By combining proactive risk analysis with robust legal safeguards and a strong culture of confidentiality, energy companies can innovate and grow while maintaining their competitive edge.

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For Sponsors:

Tariff Risk-Sharing Clauses in Project Documents

Sponsors can embed tariff-specific provisions into EPC, supply, and O&M agreements. Ideally, to shield themselves鈥攁nd by extension, lenders鈥攆rom cost volatility, sponsors would secure fixed-price contracts and allocate as much tariff risk as possible to suppliers or EPC contractors. However, in today鈥檚 tariff environment, a balanced approach is often more commercially feasible. For example, one party may assume tariff risk up to a certain threshold (either in absolute dollar terms or as a percentage), after which the other party shares in the tariff burden. Beyond a second threshold, either or both parties may have termination rights. Some sponsors have also successfully negotiated limited tariff risk-sharing with offtakers. Example structures include enabling the sponsor to seek a defined contract price increase if its costs exceed an agreed-upon threshold by automatic right, with anything above that threshold requiring joint approval with the offtaker.  Further, should joint agreement not be possible, the sponsor sometimes has an early termination right (often coupled with a termination fee) if the project just isn鈥檛 economic.

Maximizing Other Incentives

Given the volatility and potential rise in tariffs, sponsors should maximize the use of government incentives, tax credits, and subsidies to offset tariff-related costs. Monitoring policy developments is crucial. Sourcing components domestically or investing in domestic manufacturing can help sponsors bypass tariffs and reduce the compliance burden related to 鈥渇oreign entity of concern鈥� rules under tax credit regimes. Exploring alternative technologies or renewable solutions not currently subject to tariffs may also yield better tariff treatment and unlock eligibility for tax credits unaffected by the One Big Beautiful Bill Act.  To learn more about the One Big Beautiful Bill Act and recent guidance, please see here and here. 

Strategic Partnerships and Supply Chain Diversification

Sponsors may benefit from building relationships with suppliers across multiple countries to reduce dependency on tariff-affected nations. Forming strategic partnerships with global renewable energy firms can enhance negotiating power. Collaborating with industry groups and leveraging advocacy channels can also help push for regulatory clarity, stability, and potential tariff exemptions for renewable components.

Financing Structures and Insurance Protections

Sponsors may also consider mezzanine financing or hybrid debt instruments to provide flexibility amid tariff-induced cost fluctuations by providing sponsors with liquidity to make quick buying decisions when pricing is more advantageous. Project refinancing strategies can also help adapt to changing tariff environments. Additionally, specialized tariff or political risk insurance can protect projects from sudden tariff implementation or escalation.  Such insurance products, typically offered by multilateral agencies, export credit institutions, or private insurers, can be structured to protect the insured project or portfolio from financial losses arising from unforeseen tariff imposition, increases in existing tariffs, or other trade鈥憆estrictive measures implemented by host or foreign governments. This coverage can be critical for projects with cross鈥慴order supply chains, imported equipment, or raw materials subject to international commodity flows.

For Financing Parties:

From the financing side, existing protections often include indemnity carve-outs that prioritize lender repayment over sponsor obligations, ensuring indemnities sit below debt service in the cash waterfall. Financing parties may also:

• Incorporate additional deadline cushions.
• Request sponsor certifications regarding AD/CVD and tariff risks.
• Require tariff-specific contingency reserves or guarantees to cover tariff-related cost increases.
• Assess sponsor creditworthiness (e.g., financial disclosures, minimum liquidity).
• Consider requesting equity contribution agreements or secured guarantees.
• Request tariff contingencies in financial models and/or special insurance coverage.

Ultimately, financing parties should be responsive to the kinds of mitigants that the applicable sponsor has been able to obtain in its project contracts for tariff risks.

As the global trade landscape continues to shift, tariff exposure will remain a critical consideration in project development and financing. By proactively embedding risk-sharing mechanisms, leveraging policy incentives, and aligning financial structures with evolving regulatory realities, both sponsors and financing parties can better navigate uncertainty and safeguard project viability. A thoughtful, collaborative approach to tariff risk management not only strengthens individual projects but also contributes to the resilience of the broader renewable energy ecosystem.

Foley鈥檚 Power & Renewables group will continue to monitor developments in this regard, and be available to clients to help deploy related strategies.

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This renewed enforcement environment raises several legal, transactional, and compliance considerations for project sponsors, investors, and counsel.

Overview: AFIDA and Its Reach

AFIDA was enacted for the collection of information regarding foreign ownership of U.S. agricultural land. Under AFIDA and its authorizing regulations, entities with at least 10% direct or indirect foreign ownership must report certain acquisitions, dispositions, and changes in use of U.S. agricultural land to the Farm Service Agency within the United Stated Department of Agriculture (USDA). 鈥淎gricultural land鈥� is defined broadly to include parcels used for farming, ranching, orchard, vineyard or timber production within the previous five years鈥攃ategories that often capture sites being repurposed for energy and infrastructure development.

While AFIDA does not prohibit foreign ownership, it does impose mandatory reporting obligations and authorizes significant civil penalties for failure to file or for submitting false or incomplete information鈥攑otentially up to 25% of the property鈥檚 fair market value.

Importantly, AFIDA applies not only to direct fee ownership of land but also to leasehold interests of 10 years or longer. Easement interests and contingent future interests (including options) are expressly excluded. 

Energy and infrastructure projects with long-term site rights often fall under the purview of AFIDA, particularly during the construction and operation periods, creating a reporting obligation that is easily overlooked.

Many states also impose reporting and ownership restrictions on foreign-owned agricultural land that can vary widely from those under AFIDA.

AFIDA Enforcement

The USDA is tasked with collecting, tracking and reporting data under AFIDA, as well as assessing civil penalties up to 25% of the fair market value of the property for non-compliance. 

While AFIDA has existed for nearly five decades, enforcement activity has historically been limited due largely to funding and staffing constraints at USDA.  In recent years, however, foreign ownership of interests in U.S. agricultural land has exploded鈥攚ith approximately 45 million acres of U.S. agricultural land held by foreign entities as of December 2023鈥攚ith calls for renewed regulatory scrutiny. Recent penalty assessment data underscores this trend:

Many recent enforcement actions have targeted renewable and other energy and infrastructure projects, reflecting both the scale of their landholdings and the increasing presence of foreign capital in energy infrastructure investment. Further, with the increased awareness of AFIDA, several legislative and regulatory proposals have been advanced in recent years that would affect its scope and operation, including more than three bills introduced in the current Congress largely aimed at increasing reporting requirements and strengthening enforcement. 

Accordingly, compliance with AFIDA and other state restrictions should be considered when acquiring, leasing, or developing land with any level of foreign ownership or investment participation. Project participants should anticipate enhanced data collection, more frequent audits, and higher penalty assessments in the years ahead and stay updated on legislative and regulatory developments in this area insofar as any changes are likely to impact compliance requirements. 

Conclusion

AFIDA enforcement, once largely perfunctory, is becoming a meaningful compliance risk for the energy and infrastructure sectors. With foreign investment continuing to play a critical role in project development and financing, project participants cannot afford to treat AFIDA as an afterthought.

Instead, investors and developers should identify potential AFIDA triggers early in site acquisition, leasing, and financing stages; incorporate compliance representations and covenants into transaction documents; and prepare for heightened scrutiny from the USDA, Congress, and state regulators鈥攁ll of whom increasingly view agricultural and rural land use through a national security lens. And with multiple recent Congressional proposals to further expand oversight and tighten reporting requirements, participants must remain vigilant and up to date on legislative developments to ensure continued compliance in a rapidly evolving compliance landscape.

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