By William Baldwin, Cindy Muller, and Sarah Dicharry, Jones Walker
The Department of the Interior’s Bureau of Ocean Energy Management (BOEM) adopted regulations in 2009 to regulate wind energy development offshore (30 C.F.R. Part 585). But to date, only two offshore wind projects are currently online in the United States: Block Island, located off the Rhode Island coast and consisting of five turbines; and Virginia Coastal Wind, located off the Virginia coast and consisting of only two turbines. Additionally, although several large-scale, commercial wind projects have been proposed to BOEM pursuant to offshore wind leases, only one — issued to Vineyard Wind LLC and located offshore Massachusetts — is nearing the commencement of operations.
After this slow start, a series of recent developments are likely to spark activity and additional capital investment in the offshore wind industry in the United States, which, in turn, will mean additional activity and capital investment in vessels to support offshore wind. For instance:
- Executive Order 14008. On January 27, 2021, within a week of his inauguration, President Biden issued Executive Order 14008, which directed Interior to identify “steps that can be taken, consistent with applicable law, to increase renewable energy production on those lands and in those waters, with the goal of doubling offshore wind by 2030[.]”
- Vineyard Wind Final Environmental Impact Statement. In March 2021, BOEM released its long-awaited Final Environmental Impact Statement (EIS), signaling that BOEM will likely permit Vineyard Wind to move forward with its proposed large-scale, commercial wind project (subject to certain modifications). BOEM’s release of the Vineyard Wind final EIS is the culmination of BOEM’s multiyear environmental review process under the National Environmental Policy Act (NEPA) of the Construction and Operations Plan (COP) submitted by Vineyard Wind (as required under BOEM’s regulations), which proposed the nation’s first large-scale, commercial offshore wind farm.
- Interagency Plan to Catalyze Offshore Wind Energy Development. On March 29, 2021, the Biden administration announced its interagency plan to “catalyze offshore wind energy[.]” This plan involves several initiatives, including BOEM’s advancement of new lease sales and completion of its review of “at least 16 Construction and Operations Plans (COPs) by 2025.” BOEM’s recent publication of the Vineyard Wind final EIS provides valuable insight into how BOEM will analyze these other proposals for commercial-scale, offshore wind energy projects.
Given these recent developments and the expected uptick in activity in the offshore wind industry, now is a good time to highlight the extensive, interagency and multi-jurisdictional regulatory process that is required after BOEM’s issuance of an offshore wind lease and before operations on that lease can actually begin. After award of a commercial, offshore wind lease, the lessee has one year (the “preliminary term”) to prepare and submit a Site Assessment Plan (SAP), which sets forth the lessee’s proposal to construct a meteorological tower or buoys on the leased area (30 C.F.R. §§ 585.601, 585.235). Once BOEM approves a proposed SAP, the lessee has up to five years to undertake the approved site assessment activities and to submit a COP ( 30 C.F.R. § 585.235), which must demonstrate that the lessee’s proposed operations (a) conform with applicable law; (b) are safe; (c) do not “unreasonably interfere with other uses of the OCS”; (d) do not cause “undue harm or damage” to natural resources, life, property, the environment, and historical sites and structures; (e) will use the “best available and safest technology”; (f) will use the “best management practices”; and (g) will use “properly trained personnel” (30 C.F.R. § 585.621). The filing of a COP triggers BOEM’s extensive, project-specific NEPA analysis culminating in BOEM’s publication of a final EIS, like the final EIS recently issued for the Vineyard Wind project. Following its issuance of a final EIS, BOEM issues a Record of Decision, in which it announces whether or not the lessee may proceed with the proposed plan (or a modified version thereof).
BOEM’s review of SAPs and COPs is an extensive process that can take quite a long time. Indeed, the Vineyard Wind lease was issued in March 2015, but BOEM only recently (in March 2021) published its final EIS in response to Vineyard Wind’s proposed COP (which was originally filed in December 2017 but subsequently revised on multiple occasions). The Vineyard Wind project demonstrates that the SAP and the COP are far from the only approvals and permits required for operations under an offshore wind lease. For instance, BOEM must also undertake a consultation process with other federal agencies and affected states under the Endangered Species Act. Also, permits must be obtained from the Environmental Protection Agency (e.g., National Pollutant Discharge Elimination System general permit, air permit) and the United States Army Corps of Engineers (e.g., Clean Water Act permits). In addition to the myriad federal agencies involved, various permits and approvals must also be obtained from relevant regional, state, and local authorities (e.g., export lines and onshore facilities).
The regulatory steps outlined in the Vineyard Wind COP, available on BOEM’s website, provide a helpful road map to the complex interagency and multijurisdictional review process implicated by BOEM’s issuance of federal offshore wind leases. And those involved in and interested in the offshore wind energy are sure to keep a close eye on Vineyard Wind’s approval process as it continues its march toward operating the first large-scale, commercial, offshore wind farm in the United States. In particular, vessel owners and operators will continue to monitor the process given the need for specialized vessels to support the anticipated surge in offshore wind development.
Will Baldwin is co-leader of the firm’s Maritime Industry Team, where he focuses on maritime transactions and litigation. Will also serves as co-chair of the firm’s offshore wind initiative.
Cindy Matherne Muller is a partner and participates in the Construction, Energy, Environmental & Natural Resources, and Maritime industry teams. She represents a broad range of companies, from large multinational EPC contractors to private equity portfolio companies, doing business in the energy, maritime, and construction industries, on capital projects and commercial and restructuring transactions, and compliance functions. Cindy also serves as co-chair of the firm’s offshore wind initiative.
Sarah Dicharry is a partner in the Litigation Practice Group. She focuses her practice on counseling exploration and production companies on compliance with federal statutes and regulations, and representing companies in administrative and judicial appeal proceedings and in response to government-initiated enforcement actions.
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