Eddy Daniels has left his post as general counsel and chief compliance officer at Panda Power Funds to join the Haynes and Boone energy practice group, the firm announced on Tuesday.
Daniels will office in Houston and Dallas. In addition to his six-plus years at Panda, he has extensive in-house experience at energy companies and financial firms including JP Morgan Chase & Co., NRG Energy, Reliant Energy and UBS Warburg Energy.
“Eddy brings in-depth power experience to Haynes and Boone, having worked at the highest levels at companies that produce and trade energy worldwide,” Jeff Nichols, co-chair of the Haynes and Boone energy practice group, said in a statement. “As a long-time consumer of legal services, he also possesses a keen understanding about how to deliver maximum value to clients.”
At the energy-focused private equity firm Panda, Daniels advised a family of funds with more than $6 billion invested in seven gigawatts of power generation projects around the U.S focusing on fund formation, equity raising, project development, acquisition and disposition, commodity transactions and regulatory affairs.
Two of the most significant joint venture projects Daniels assisted with were the Panda Stonewall Power Project and the Panda Hummel Station Power Project.
Daniels said the situation at Panda was “played out” when it became clear that the founders wouldn’t raise a fourth fund and were selling their interests in the firm’s plants.
“It’s been tough for Texas power plants,” he said. “They’ve been hit by regulatory changes, mild summers and a weak market for wholesale power. That’s created challenges for the expansion of that business, and without expansion, it creates a stall-out.”
The lawyer said he’s excited about joining Haynes and Boone, whose energy practice has grown much stronger over the years, particularly in renewable power.
“I am supplementing an already strong energy practice,” he said. “I’ve done both traditional and renewable, but my practice is skewed toward conventional power plants.”
Before joining Panda in April 2013, Daniels was managing director and assistant general counsel of global commodities at JP Morgan Chase. Prior to that, he was vice president and assistant general counsel of M&A and development at NRG Energy, where he advised on the planned expansion of the South Texas Nuclear Project that included joint venture agreements with Toshiba Corp.
Daniels said it was a hot deal market for power assets last year, but then there was a slowdown given financial distress in the industry due to low natural gas prices. But conditions could start to improve soon.
“When debt starts to mature and it becomes a challenge to refinance, companies typically merge with a stronger partner or do a recap, with a new owner putting money in and right-sizing the debt,” he said. “We saw it in oil and gas when prices were soft. It’s the same thing in power: plants were built but now they’re suboptimal; the debt is being paid but it’s getting harder.”
Daniels said the tough regulatory environment in Texas as well as not-as-hot summers create an environment in which new plants can’t be profitably operated and developed. And given Texas’ strong economy, that could lead to a possible power crisis over the next two to three years.
“In a world where every year the load growth is 1,000 to 2,000 megawatts, we need three or four new plants and we’re getting almost none,” he said. “It’s creating a tight market.”
Daniels received his law degree from the University of Texas in 1993. After graduating, he clerked for the Judge Melinda Harmon of the U.S. District Court for the Southern District of Texas and Justice Edith Jones of the U.S. Fifth Circuit Court of Appeals. He went into private practice at Baker Botts after completing his judicial clerkships.