Legal Framework of Offshore Wind Energy

As the push from both the public and private sectors to invest in renewable energy has intensified in recent years, new methods of energy production continue to emerge in the market. In the United States, a combination of hydropower, biofuels, and wind power produce most of the country’s clean energy. [1] Since renewable energy has only recently become a priority in the energy market, new and innovative technologies continue to be implemented, transforming the legal landscape along with it.

One recent renewable energy innovation that has emerged is offshore wind power. While offshore wind power has been used for energy production in Europe since the early nineties and in other regions within the last decade, it has only recently become a development in the U.S. energy market. Due to its recent inception in the U.S., the legal framework that regulates offshore wind power remains underdeveloped and nearly precedent-less, making for a complex legal environment.

The first offshore wind farm in the U.S. was Block Island Wind Farm off the coast of Rhode Island, which became operational in 2016. Since then, various additional projects have been proposed and some have received the permits necessary to begin the construction process. Interest in offshore wind technology is especially strong in areas like the Northeast and California, where coastal regions are too densely populated for renewable energy infrastructure like wind turbines, but still have an abundance of unused offshore space. Moreover, ocean wind speeds are typically faster than land wind speeds, which translates to a greater power-generating potential for offshore wind turbines. As these factors have prompted interest in offshore wind as a renewable energy alternative, legislators and lawyers have begun defining and interpreting the legal parameters of offshore wind projects.

Within the current legal framework, the Energy Policy Act of 2005 (EPAct 2005) is an essential piece of legislation in regard to offshore wind regulation. EPAct 2005 Sec. 388 gives the U.S. Secretary of the Interior authority over offshore renewable energy facilities on the Outer Continental Shelf, granting them jurisdiction over the development of wind farms and the federal leasing process. [2] Within the Department of the Interior, the Bureau of Ocean Energy Management (BOEM) is responsible for determining potential offshore areas on the Outer Continental Shelf for renewable energy facilities. BOEM can also establish intergovernmental task forces for identified wind areas to begin the extensive legal process required for a proposed project, which spans across legislative fields from environmental law to federal leasing contracts. [3]

Most of the regulatory legislation pertaining to offshore wind facilities falls under the Environmental Protection Agency (EPA). Specifically, there are four main pieces of legislation enforced by the EPA that concern offshore wind developments: the National Environmental Policy Act (NEPA), the Endangered Species Act (ESA), the Migratory Bird Treaty Act (MBTA), and the Coastal Zone Management Act (CZMA). [4]

NEPA is the broadest of the four statutes and requires that federal agencies consider the environmental impact of proposed federal projects. It outlines a lengthy compliance process overseen by the Council on Environmental Policy and mandates comprehensive research of potential environmental harms. While NEPA also broadly regulates the impact to wildlife, the ESA and MBTA more specifically protect endangered species and birds that could be affected by projects like offshore wind farms. So far, the primary concerns for proposed offshore wind projects have been their impact on marine life and migratory birds that fly through the proposed wind farm areas. [5] Lastly, the CZMA protects coastal resources and is overseen by the National Oceanic and Atmospheric Administration.

Interestingly, the piece of legislation that has been most restricting to offshore wind projects thus far is not related to environmental regulation, energy, or the grounds for a permit, but rather a federal statute promoting and regulating mercantile activity on U.S. coasts. The Jones Act, a subsection of the Merchant Marine Act of 1920, mandates that all goods traded between U.S. ports must be carried on U.S. constructed ships flying a U.S. flag, be manned by a primarily U.S. crew, and be owned by U.S. citizens.

This statute complicates the construction process for offshore wind facilities because, as of today, the only ships capable of constructing these massive structures offshore are foreign-flag ships. [6] In the case of the Block Island Wind Farm, they were able to maneuver around this legislation by citing that foreign ships were stationary during the construction process and were not involved in conducting coastwise trade.

Since many of the legal questions that arise concerning offshore wind developments are unchartered legal territory, the legal field will likely continue to evolve as more projects continue to be introduced. Thus far, the primary legal complications that arise with offshore wind power are the jurisdictional intersection between federal and state statutes, the fact that the area has little relevant precedent, and the necessary compliance with environmental and mercantile regulations.

While there are still some federal legislative roadblocks for offshore wind projects such as the Jones Act, individual states have proactively introduced policy to facilitate offshore wind projects off the coast of their states. [7]. In the past few years, New York, Rhode Island, and Massachusetts have passed legislation to promote offshore energy construction, which has, in turn, increased interest in the private sector. While such state-driven progress is beneficial to the implementation of offshore wind technology for the U.S. as a whole, legal scholars have argued that in order to truly create a legal environment conducive to offshore wind development, states will have to continue crafting stronger policy, since federal legislation is less favorable for renewable energy innovation. [8]

[1] "Renewable Energy Explained." U.S. Energy Information Administration. July 13, 2018. Accessed March 12, 2019. https://www.eia.gov/energyexplained/?page=renewable_home.

[2] Energy Policy Act of 2005, 42 USCS § 15801 (2005).

[3] "Regulatory Framework and Guidelines." Bureau of Ocean Energy Management. Accessed March 12, 2019. https://www.boem.gov/Regulatory Framework/.

[4] K&L Gates. Offshore Wind Handbook. October, 2018.

[5] Ibid.

[6]"How the Offshore Wind Energy Industry Can Overcome the Jones Act." POWER Magazine.

March 01, 2018. Accessed March 12, 2019. https://www.powermag.com/how-the-offshore-wind-energy-industry-can-overcome-the-jones-act/.

[7] Polefka, Shiva. "State Policies Can Unleash U.S. Commercial Offshore Wind Development." Center for American Progress. September 18, 2017. Accessed March 12, 2019.

https://www.americanprogress.org/issues/green/reports/2017/09/18/439078/state-policies-can-unleash-u-s-commercial-offshore-wind-development/.

[8] Ibid.