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US Offshore Wind Regulations and Legal Requirements Part 1

Part 1 of 2 authored by Julian Jackson – writer on technology, arts, blockchain and cryptocurrencies

The regulatory and legal requirements concerning aspects of OW planning, installation, and operation involve a complex skein of Federal, State, Local, and Tribal Authorities. BOEM and the DOE are the leading agencies. However, different authorities may be responsible for particular aspects of consenting; for example, the U.S. Fish and Wildlife Service (FWS) is responsible for fish and wildlife impacts of wind arrays. The US Coast Guard and US Army Corps of Engineers have essential functions regarding coastal and continental shelf developments.

The Historical Background

For decades, the area around the US shores has been the province of oil and gas exploration and production. In 2005 Congress added an amendment to the Energy Policy Act (EPAct 2005) to clarify federal jurisdiction over offshore renewable energy facilities. Section 388 of the Act gives the US Secretary of the Interior, in coordination with other agencies, authority over offshore renewable energy developments on the Outer Continental Shelf. BOEM is the lead implementing agency for this power. It decides where areas of the seabed may be offered for competitive leasing to wind farm projects, and this has spurred the planning and development of numerous applications, mainly off the East Coast but also in Hawaii, California, and the Great Lakes.

Other Stakeholder Inputs

These are not the only considerations. The processes of permitting and certification are long and have not been thoroughly tested. Many stakeholders have inputs, including the power companies, local or municipal authorities, commercial or recreational fishers, and environmental protection organizations.

The EPAct 2005 does clarify that a wide range of federal and state agencies remain key contributors to the OW development process and projects must comply with the National Environmental Policy Act (NEPA).

BOEM’s Process

BOEM has a good deal of latitude in how it assesses proposals to develop an offshore wind project. Typically, during the Planning and Leasing process, the agency issues Requests for Information (RFIs), Calls for Information and Nominations and also requests to identify priority Wind Energy Areas. It is also open to receiving unsolicited applications from OW developers or consortiums.

When it has a lease area or WEA for potential auction, it must conduct an environmental review and assessment under the NEPA. There are a variety of methods BOEM can use to evaluate the bids and decide which is the most appropriate tender.

The winner receives access and operational rights to produce, sell, and deliver renewable energy from the planned wind farm.

The Next Phase: Site Assessment

Within 12 months, the lessee is required to prepare and submit a Site Assessment Plan or a Site Assessment Plan and a Construction and Operation Plan to BOEM, describing how the company will perform its testing and assessment activities.

BOEM will then analyze these plans, deciding whether to approve, reject, or approve with conditions.

Assuming approval of the SAP, the developing company then has five years to produce its COP – unless it has already submitted it. If that is approved, then the company will enter into a 25-year commercial lease, with the possibility of renewal beyond the initial period.

The COP normally includes information about any substations, cabling, and onshore facilities needed, including rights-of-way provisions.

This is a time-consuming process. Many projects can spend 7-10 years moving through the various stages before they can construct and deliver power from their turbines. Both the wind energy industry and the regulators are aware of the issue and are looking at ways of speeding up the process.

Important Legislation Impacting OW Projects
  1. National Environmental Policy Act (NEPA)

  2. Endangered Species Act (ESA)

  3. Migratory Bird Treaty Act (MBTA)

  4. Coastal Zone Management Act (CZMA)

  5. Merchant Marine Act of 1920 (The Jones Act)

  6. Outer Continental Shelf Lands Act (OCLSA)

National Environmental Policy Act (NEPA)

Passed in 1969, NEPA (42 U.S.C. §§ 4321-4347) is the foundation of environmental policymaking in the United States. The NEPA process is designed to help public officials make decisions based on a complete understanding of environmental consequences and take actions that protect, restore, and enhance the environment.

Endangered Species Act (ESA)

Passed in 1973, the ESA (16 U.S.C. § 1531 et seq.) intends to conserve endangered and threatened species and their habitats. There are approximately 1,930 species listed under the ESA that are found in part or entirely within the United States and its waters.

Migratory Bird Treaty Act (MBTA)

Passed in 1918, the MBTA implements the United States’ commitment to four bilateral treaties, or conventions, for the protection of the shared migratory bird resource.

Coastal Zone Management Act (CZMA)

In 1972, Congress enacted the CZMA (16 U.S.C. § 1451 et seq.) to protect the coastal environment from impacts of residential, recreational, commercial, and industrial uses.

Section 27 of the Merchant Marine Act of 1920 (the Jones Act)

The Jones Act is a federal law that regulates maritime commerce in the United States. It requires goods shipped between U.S. ports to be transported on ships that are built, owned, and operated by United States citizens or permanent residents. The Jones Act is officially Section 27 of the Merchant Marine Act of 1920, which provided for the maintenance of the American merchant marine.

During the construction of Block Island Wind Farm, several vessels were used, including a non-Jones Act compliant ship: Olsen Windcarrier's jack-up installation vessel Brave Tern. Although the installers had to use barges to transport the equipment for putting down on the seabed, and this was deemed less than optimal, it shows that there is some leeway in the provision of the Jones Act, until a US shipyard builds a compliant vessel.

Outer Continental Shelf Lands Act (OCSLA)

The Outer Continental Shelf Lands Act, created in 1953, defines the OCS as all submerged lands lying seaward of state coastal waters (3 miles offshore), which are under U.S. jurisdiction. Under the OCSLA, the Secretary of the Interior is responsible for the administration of mineral exploration and development of the OCS. The Act empowers the Secretary to grant leases to the highest qualified responsible bidder based on sealed competitive bids and to formulate regulations as necessary to carry out the provisions of the Act.

Laws Relating to Ships and the Sea

Various laws cover maritime operations. These can be categories as either Law of the Sea, concerning vessels and their transit, and those about ships' crew, their safety, and operations in port, in addition to the requirements of the Jones Act.

These include the Longshore & Harbor Workers Compensation Act (LHWCA), which deals with shore personnel injured during their duties, and the Outer Continental Shelf Lands Act (OCLSA).

During the construction and operation of wind farms, the companies involved will need to do risk assessments and be aware of the provisions of these acts and insure appropriately.

This is Part 1 of 2. The next article covering more regulatory and legal issues will follow soon.

Originally posted at New Energy Update by Reuters Events US Offshore Wind Blog.

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Discussions

Matt Chester's picture
Matt Chester on Jan 13, 2020 10:32 pm GMT

It's definitely a delicate balancing act-- you want the regulatory review to go quickly enough and predictably enough that investment isn't scared off, but you also want to not speed through it so the purpose of these reviews is lost. 

Do you have thoughts on how this balance for offshore wind compares with that of other energy infrastructure in the U.S.?

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