USA - BOEM Floats Proposal to Modernize Offshore Wind Regulations
A new proposal aims to streamline the process for permitting and developing offshore renewable energy projects and reduce costs to developers.
On January 30, 2023, the Bureau of Ocean Energy Management (BOEM) published a new proposed rule to update the agency’s regulations governing renewable energy development on the Outer Continental Shelf (OCS).[1] The proposed rule is the first major overhaul of BOEM’s offshore renewable energy regulations since they were promulgated, and seeks to benefit from the agency’s and industry’s experience since 2009. Since then, BOEM has conducted 11 offshore wind energy lease sales and currently is managing 27 active commercial leases.
The proposed regulations would “modernize regulations, streamline overly complex and burdensome processes, clarify ambiguous provisions and enhance compliance provisions in order to decrease costs and uncertainty associated with the deployment of offshore wind facilities,” and would save developers an estimated $1 billion over a 20-year period.[2] Regulatory changes to decrease costs and increase certainty for developers are particularly critical when offshore wind energy developers are facing ever-increasing installation and materials costs. Some developers are even seeking to renegotiate power purchase agreements for their contracts that account for increased development costs. Comments on the proposed rule are due by March 31, 2023.
BOEM’s proposed regulations, described in a notice of proposed rulemaking (NPRM), will involve the following seven “major components,” discussed in further detail below:
- Eliminating approval of meteorological buoys during site assessment
- Increasing geophysical and geotechnical (G&G) survey flexibility
- Improving the project design and installation verification process
- Establishing a public Renewable Energy Leasing Schedule
- Reforming BOEM’s renewable energy auction regulations
- Tailoring financial assurance requirements and instruments
- Clarifying safety management system regulations
BOEM is also proposing additional and other potential modifications, including simplifying and reorganizing the information required in Construction and Operations Plans (COP) and General Activities Plans (GAP), codifying the use of project design envelops (PDE), and modifications related to transmission.
The proposed rulemaking comes at a time when BOEM, and the administration writ large, are laser-focused on accelerating development of offshore wind energy. In the last two years alone, BOEM has issued final approvals for the country’s first two commercial-scale offshore wind projects, held three offshore wind lease sales (including the first offshore wind lease sale on the Pacific coast), initiated the environmental review for 10 new offshore wind projects on the Atlantic coast, proposed a lease sale in the Gulf of Mexico, identified Wind Energy Areas for potential leasing in the Central Atlantic, and identified areas offshore Oregon for further investigation (also known as Call areas).
Eliminating BOEM Approvals for Meteorological Buoys
Under BOEM’s current regulations, an offshore renewable energy leaseholder must submit and receive BOEM approval of a Site Assessment Plan (SAP) before the lessee can install meteorological towers and buoys to measure meteorological conditions in the lease. In the NPRM, BOEM is proposing to eliminate the SAP requirement for meteorological buoys due to changes in industry’s meteorological data collection practices and to reduce redundancy with US Army Corps of Engineers (USACE) permitting requirements. BOEM noted in the NPRM that it instituted this SAP requirement in 2009 when the offshore wind industry gathered meteorological data primarily from towers fixed to the seafloor The industry has since transitioned to using buoys anchored to the seafloor that involve much less environmental impact while gathering the same amount and quality of data.
