• In a small bowl, combine warm water and yeast, plus of 1 teaspoon granulated sugar. Stir and let stand until foamy, about 5 minutes.
• In large bowl (or in the bowl of a stand mixer), combine flour, baking powder, baking soda, salt, and remaining granulated sugar. With paddle attachment, pastry blender, or 2 knives, cut in butter until mixture resembles fine crumbs.
• Stir buttermilk and egg into yeast mixture until blended. Pour yeast mixture into flour mixture and stir until combined and soft dough forms. (Dough will be sticky.)
• On lightly floured work surface (and with floured hands unless you want more dough on you than in the beignets), knead dough lightly several times until dough is smooth. Spray same bowl with nonstick cooking spray and place dough in bowl. Cover and let stand 10 minutes.
• Line 2 large baking pans with parchment paper. Punch down dough. On floured work surface, with floured rolling pin, roll dough to 9-in. square. Cut the dough into 6 strips, then cut each strip into 6 pieces, making 36 (1½-in.) square pieces. A floured or oiled knife or a pizza cutter are the best tools for this.
• Transfer beignets to pans, placing about 1½ inches apart. Let rise 20 minutes in a dark place.
• Preheat the oven to 400°F. Bake risen Beignets 10 to 12 minutes, or until just golden brown, rotating pans between upper and lower racks halfway though baking. 
• Remove from oven and immediately toss with confectioners' sugar, until coated. Serve Beignets warm with warm Café au Lait Dipping Sauce.

For Cafe Au Lait Dipping Sauce

• In a 3-quart saucepan, whisk together granulated sugar, espresso powder, and cornstarch. Place over medium heat, and whisk in milk, making sure there are no lumps. 
• Cook for 8 minutes, whisking often, until mixture comes to a slight boil and begins to thicken. (Careful not to scorch.)
• Reduce heat to low and simmer 2 minutes, whisking constantly. Remove pan from heat. Add chocolate chips and whisk until melted and smooth; cover and set aside. (It makes a lot!)