[Federal Register Volume 79, Number 189 (Tuesday, September 30, 2014)]
[Proposed Rules]
[Pages 59022-59085]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-23089]



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Vol. 79

Tuesday,

No. 189

September 30, 2014

Part V





 Department of the Interior





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Bureau of Land Management





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43 CFR Parts 2800 and 2880





Competitive Processes, Terms, and Conditions for Leasing Public Lands 
for Solar and Wind Energy Development and Technical Changes and 
Corrections; Proposed Rule

  Federal Register / Vol. 79 , No. 189 / Tuesday, September 30, 2014 / 
Proposed Rules  

[[Page 59022]]


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DEPARTMENT OF THE INTERIOR

Bureau of Land Management

43 CFR Parts 2800 and 2880

[LLWO301000.L13400000]
RIN 1004-AE24


Competitive Processes, Terms, and Conditions for Leasing Public 
Lands for Solar and Wind Energy Development and Technical Changes and 
Corrections

AGENCY: Bureau of Land Management, Interior.

ACTION: Proposed rule.

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SUMMARY: The Bureau of Land Management (BLM) proposes to amend existing 
regulations to facilitate responsible solar and wind energy development 
and to receive fair market value for such development. The proposed 
rule would promote the use of preferred areas for solar and wind energy 
development and establish competitive processes, terms, and conditions 
(including rental and bonding requirements) for solar and wind energy 
development rights-of-way both inside and outside these preferred 
areas. In the proposed rule, preferred areas for solar and wind energy 
development would be called ``designated leasing areas.'' The proposed 
rule would also make technical changes, corrections, and clarifications 
to existing rights-of-way regulations. Some of these changes would 
affect all rights-of-way and some provisions would affect particular 
types of actions, such as transmission lines with a capacity of 100 
Kilovolts (kV) or more, or pipelines 10 inches or more in diameter.

DATES: Please submit comments on or before December 1, 2014.

ADDRESSES: You may submit comments by any of the following methods:
    Mail: Director (630) Bureau of Land Management, U.S. Department of 
the Interior, 1849 C St. NW., Room 2134LM, Washington, DC 20240, 
Attention: 1004-AE24.
    Personal or messenger delivery: U.S. Department of the Interior, 
Bureau of Land Management, 20 M Street SE., Room 2134LM, Attention: 
Regulatory Affairs, Washington, DC 20003.
    Federal eRulemaking Portal: http://www.regulations.gov. Follow the 
instructions at this Web site.
    You may submit comments on the proposed collection of information 
by fax or electronic mail as follows:
    Fax: Office of Management and Budget, Office of Information and 
Regulatory Affairs, Desk Officer for the Department of the Interior, 
202-395-5806.
    Electronic mail: [email protected].
    Please indicate ``Attention: OMB Control Number 1004-XXXX,'' 
regardless of the method used. If you submit comments on the proposed 
collection of information please provide the BLM with a copy of your 
comments at one of the addresses shown above.

FOR FURTHER INFORMATION CONTACT: Ray Brady, Bureau of Land Management, 
at 202-912-7312, for information relating to the BLM's solar and wind 
renewable energy programs, or the substance of the proposed rule. For 
information pertaining to the changes made for any transmission line 
with a capacity of 100 kV or more, or any pipeline 10 inches or more in 
diameter you may contact Lucas Lucero at 202-912-7342. For information 
on procedural matters or the rulemaking process you may contact Jean 
Sonneman at 202-912-7405. Persons who use a telecommunications device 
for the deaf (TDD) may call the Federal Information Relay Service 
(FIRS) at 1-800-877-8339, to contact the above individuals.

SUPPLEMENTARY INFORMATION: 

Executive Summary

    The BLM initiated this rulemaking in 2011 by publishing an Advance 
Notice of Proposed Rulemaking (ANPR) seeking public comment on a 
potential regulatory framework for competitive solar and wind energy 
rights-of-way. The regulations in this proposed rule would provide for 
such a framework, update rental fees, establish new Megawatt (MW) 
Capacity fees for wind and solar energy projects, and codify existing 
solar and wind energy policies in 43 CFR 2800. The proposed regulations 
also would affect other rights-of-way, including transmission lines 
with a capacity of 100 kV or more, and pipelines 10 inches or more in 
diameter.

Statutory and Regulatory Authority

    Facilities for the generation, transmission, and distribution of 
electric energy are authorized under Title V of the Federal Land Policy 
and Management Act (FLPMA) (43 U.S.C. 1761-1771) and 43 CFR part 2800. 
Section 501(b)(1) includes provisions authorizing the consideration of 
competition in the issuance of a right-of-way. Section 504(g) requires 
annual rental payments of fair market value for a right-of-way, but 
does not provide for royalty payments on electricity generation.
    Rights-of-way for oil and gas pipelines are authorized under 
Section 28 of the Mineral Leasing Act (30 U.S.C. 185) and 43 CFR Part 
2880. The BLM processes applications for these categories of rights-of-
way in accordance with 43 CFR 2884.11.

Policies

    Title V of FLPMA authorizes the BLM to issue right-of-way grants, 
leases, and easements. The majority of BLM-issued rights-of-way are 
grants. The BLM intends to differentiate the solar and wind energy 
development rights-of-way issued inside a designated leasing area under 
new subpart 2809 as leases, which would be a type of grant with 
specific requirements.
    The BLM released a Draft Solar Energy Programmatic Environmental 
Impact Statement (EIS) on December 17, 2010, and released a 
Supplemental Solar EIS on October 28, 2011. The Supplemental EIS 
included discussions of a process to identify and offer public lands in 
Solar Energy Zones (SEZs) through a competitive leasing process. The 
Supplemental EIS indicated that the BLM would pursue a rulemaking 
process to implement a competitive leasing program within SEZs. The BLM 
released the Final Solar EIS on July 27, 2012, and the Secretary signed 
the Record of Decision on October 12, 2012, which carried forward the 
proposal to establish a competitive leasing program within the SEZs.
    The designation of SEZs, as an outcome of the Solar Energy 
Programmatic EIS, provides the foundation for initiating a Bureau-
motion competitive process for offering lands for solar energy 
development within the SEZs. Similar efforts could be initiated by the 
BLM for designated wind development areas that may be identified in the 
future. The public comment period on the ANPR ended in February 2012 
and this proposed rule has been prepared for competitive solar and wind 
energy leases in designated renewable energy leasing areas.

Competitive Leasing Process

    The proposed rule outlines the competitive leasing process for 
solar and wind energy leases in designated leasing areas, including the 
definition of designated leasing areas, the nomination process, reviews 
of nominations, competitive bidding procedures, and the administration 
of solar or wind energy leases issued through the competitive leasing 
process. The proposed rule also includes provisions to provide 
incentives for leases within designated leasing areas. The proposed 
rule establishes a new $15 per-acre

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application filing fee for right-of-way applications outside of 
designated leasing areas to discourage speculative applications and 
encourage development in the preferred designated leasing areas.
    The proposed rule would provide for variable offsets when the 
competitive bidding process is used in a designated leasing area. A 
bidder would have an opportunity to pre-qualify for the offset by 
meeting the factors set forth in the Notice of Competitive Offer. Pre-
qualified bidders would be eligible for offsets limited to no more than 
20 percent of the high bid. Factors for a bidder to pre-qualify may 
vary from one competitive lease offer to another, but could include 
offsets for bidders with an approved Power Purchase Agreement (PPA) or 
Interconnect Agreement, among other factors. The proposed rule also 
includes revised language to facilitate the competitive ROW application 
process outside of designated leasing areas under the provisions of the 
existing right-of-way regulations at 43 CFR 2804.23. This provision 
would allow the use of a competitive process to select a preferred 
applicant for the processing of a ROW application outside of designated 
leasing areas.

Incentives

    The proposed rule includes some financial incentives for leases 
within designated leasing areas. Incentives for designated leasing 
areas would include a limited nomination fee of $5 per acre for wind 
and solar competitive parcels, variable offsets for pre-qualified 
bidders, 10-year phase-in of the MW capacity fee as opposed to a 3-year 
phase-in for authorizations outside of a designated leasing area, 
issuance of 30-year fixed-term leases, and standard bonding 
requirements to include $10,000 per acre for solar energy development 
and $20,000 per wind energy turbine.

Rents and Fees

    The proposed rule would update the annual rent schedules for both 
solar and wind energy authorizations. The acreage rent would be based 
on the acreage of the authorization, using a 10 percent encumbrance 
value for wind energy authorizations and a 100 percent encumbrance 
value for solar energy authorizations. This compares to a 50 percent 
encumbrance value that is used for determining rent for a linear right-
of-way on the public lands. The acreage rent for both linear rights-of-
way and solar and wind energy rights-of-way would vary by individual 
counties and are based on land values determined by data published by 
the National Agricultural Statistics Service.
    A MW capacity fee would be used to capture the increased value of a 
solar or wind energy project on the public lands above the rural land 
value captured by the acreage rent. The MW capacity fee captures the 
value of the electrical generation from a project based on a formula 
that includes the MW size of the approved project, a capacity factor or 
efficiency factor based on average potential electric generation that 
varies by solar and wind technologies, average wholesale prices of 
electricity, and a Federal rate of return based on a 20-year Treasury 
bond. The capacity factor used for calculating the MW capacity fee 
would be 20 percent for solar photovoltaic (PV), 25 percent for 
concentrated solar power (CSP), 30 percent for CSP with storage, and 35 
percent for wind.
    The MW capacity fee would increase from the current fee of $4,155 
per MW to $6,209 per MW for wind energy authorizations and adjust to 
$3,548 per MW for PV solar, $4,435 per MW for CSP solar and $5,322 per 
MW for CSP solar with storage. The MW capacity fee would provide for a 
3-year phase-in outside of designated leasing areas (25 percent, 50 
percent and 100 percent) and provide for a 10-year phase-in within 
designated leasing areas (50 percent the first 10 years and 100 percent 
for subsequent years). The MW capacity fees are based upon and 
supported by an appraisal consultation report performed by the 
Department's Office of Valuation Services.
    The proposed rule would expand cost recovery, in response to BLM 
field office recommendations, to the pre-application process that has 
been implemented for solar and wind energy projects. In addition, the 
proposed rule would provide for cost reimbursement measures to coincide 
with a Secretarial Order for delegation of FLPMA cost recovery 
authority to other agencies and offices of the Department of the 
Interior.

43 CFR Part 2880

    The BLM is proposing revisions to several subparts of part 2880. 
These revisions are necessary to ensure consistency of policies, 
processes, and procedures, where possible, between rights-of-way 
applied for and administered under part 2800 and those applied for and 
those rights-of-way administered under part 2880. In addition, the BLM 
is proposing pre-application requirements and fees for any transmission 
line with a capacity of 100 kV or more, or any pipeline 10 inches or 
more in diameter (see section 2884.10), similar to those being proposed 
for all solar energy and wind energy projects. Authorizations for solar 
or wind energy, for any transmission line with a capacity of 100 kV or 
more, or any pipeline 10 inches or more in diameter, are all generally 
large-scale operations that require additional steps to help protect 
the public land.

I. Public Comment Procedures
II. Background
III. Advance Notice of Proposed Rulemaking for the Competitive Solar 
and Wind Energy Development Regulations
IV. General Discussion and Section-by-Section Analysis
V. Procedural Matters

I. Public Comment Procedures

    You may submit comments on this proposed rule by mail, personal or 
messenger delivery, or electronic mail.
    Mail: Director (630) Bureau of Land Management, U.S. Department of 
the Interior, 1849 C St. NW., Room 2134LM, Washington, DC 20240, 
Attention: Regulatory Affairs, 1004-AE24.
    Personal or messenger delivery: U.S. Department of the Interior, 
Bureau of Land Management, 20 M Street SE., Room 2134LM, Attention: 
Regulatory Affairs, Washington, DC 20003.
    Electronic mail: You may access and comment on the proposed rule at 
the Federal eRulemaking Portal by following the instructions at that 
site (see ADDRESSES).
    Written comments on the proposed rule should be specific, should be 
confined to issues pertinent to the proposed rule, and should explain 
the reason for any recommended change. When possible, comments should 
reference the specific section or paragraph of the proposed rule that 
the comment is addressing.
    The BLM need not consider or include in the Administrative Record 
for the final rule, comments that it receives after the close of the 
comment period (see DATES) or comments delivered to an address other 
than those listed above (see ADDRESSES).
    Comments, including names and street addresses, will be available 
for public review at the U.S. Department of the Interior, Bureau of 
Land Management, 20 M Street SE., Room 2134LM, Washington, DC 20003 
during regular hours (7:45 a.m. to 4:15 p.m.), Monday through Friday, 
except holidays. They will also be available at the Federal eRulemaking 
Portal: http://www.regulations.gov. Follow the instructions at this Web 
site.
    You may submit comments on the proposed collection of information 
by fax or electronic mail as follows:
    Fax: Office of Management and Budget, Office of Information and

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Regulatory Affairs, Desk Officer for the Department of the Interior, 
202-395-5806.
    Electronic mail: [email protected]. Please 
indicate ``Attention: OMB Control Number 1004-XXXX,'' regardless of the 
method used. If you submit comments on the proposed collection of 
information, please provide the BLM with a copy of your comments at one 
of the addresses shown above.
    Before including your address, telephone number, email address, or 
other personal identifying information in your comment, be advised that 
your entire comment--including your personal identifying information--
may be made publicly available at any time. While you can ask in your 
comment for the BLM to withhold your personal identifying information 
from public review, we cannot guarantee that we will be able to do so.

II. Background

    Section 310 of the Federal Land Policy and Management Act (FLPMA) 
(43 U.S.C. 1740) authorizes the Secretary of the Interior (Secretary) 
to promulgate regulations with respect to public lands. FLPMA also 
provides comprehensive authority for the administration and protection 
of the public lands and their resources and directs that the public 
lands be managed ``on the basis of multiple use and sustained yield'' 
(43 U.S.C. 1701(a)(7)).
    In this proposed rule, the BLM would amend its regulations to 
provide for two competitive processes for solar and wind energy rights-
of-way on public lands. One of the processes would be for lands inside 
``designated leasing areas,'' that is, areas that have been identified 
as preferred for solar or wind energy facility development. The other 
process would be for lands outside of such areas. The proposed rule, in 
an amendment of 43 CFR 2801.5, would define the term ``designated 
leasing area'' as a parcel of land with specific boundaries identified 
by the BLM land-use planning process as being a preferred location, 
conducted through a landscape-scale approach, for solar or wind energy 
where a competitive process must be undertaken.
    For lands outside designated leasing areas, the BLM would amend 
existing section 2804.23 to allow the BLM to provide for a competitive 
bid process specifically for solar or wind energy development. At 
present, section 2804.23 authorizes a competitive process only when the 
BLM is resolving competing applications for the same facility or 
system. Under amended section 2804.23, the BLM could competitively 
offer lands by soliciting bids. The highest bidder would become the 
preferred applicant for a right-of-way if all requirements are met. The 
competitive process for solar and wind energy development on lands 
outside of designated leasing areas is outlined in new section 2804.30.
    The competitive process for lands inside designated leasing areas 
is outlined in new 43 CFR subpart 2809, which would provide for a 
nomination and competitive process, instead of an application process. 
This nomination and competitive process for lands inside designated 
leasing areas was the primary focus of the BLM's Advance Notice of 
Proposed Rulemaking (ANPR) that was published on December 29, 2011 (76 
FR 81908).
    This proposed rule includes not only the process that was 
emphasized in the ANPR and a proposed competitive process for lands 
outside of designated leasing areas, but also a number of amendments to 
other provisions of the right-of-way regulations found at 43 CFR part 
2800 and 43 CFR part 2880. The BLM has determined that it is necessary 
to first articulate the general requirements for rights-of-way in order 
to distinguish the specific solar and wind requirements.
    For example, the proposed rule has mandatory bonding requirements 
for solar and wind energy, including a minimum bond amount. The BLM has 
determined that bonding is necessary for all solar and wind rights-of-
way because of the intensity and duration of the impacts of such 
authorizations. For other right-of-way grant or lease authorizations, 
the BLM would require bonding at its discretion, under both the 
existing and proposed regulations. The proposed regulations, however, 
identify specific bonding requirements, should the BLM require a bond.
    Other proposed amendments pertain to right-of-way bonding, rents 
for rights-of-way, and changes in pre-application requirements for 
applications for any transmission line with a capacity of 100 kV or 
more, or any pipeline 10 inches or more in diameter. Based on the BLM's 
experience, pipelines and transmission lines of these sizes would be 
large-scale projects and generate more public interest. In addition, 
this rule proposes several technical corrections.
    FLPMA provides comprehensive authority for the administration and 
protection of the public lands and their resources and directs that the 
public lands be managed ``on the basis of multiple use and sustained 
yield'' (43 U.S.C. 1701(a)(7)). As defined by FLPMA, the term ``right-
of-way'' includes an easement, lease, permit, or license to occupy, 
use, or traverse public lands (43 U.S.C. 1702(f)). Title V of FLPMA (43 
U.S.C. 1761-1771) authorizes the BLM to issue rights-of-way for 
electric generation systems on the public lands and this authority 
includes solar and wind energy generation systems. FLPMA also mandates 
that ``the United States receive fair market value of the use of the 
public lands and their resources unless otherwise provided for by 
statute'' (43 U.S.C. 1701(a)(9)). Section 28 of the Mineral Leasing Act 
(MLA) (30 U.S.C. 185) provides similar authority for authorizing 
rights-of-way for oil and gas pipelines. The BLM has authority to issue 
regulations under both FLPMA (43 U.S.C. 1740) and the MLA (30 U.S.C. 
185).
    The Energy Policy Act of 2005 (codified at 42 U.S.C. 15801 et seq.) 
(EPAct) includes provisions authorizing and encouraging the Federal 
Government to develop energy producing facilities. Title II of the 
EPAct includes a provision encouraging the Secretary to approve non-
hydropower renewable energy projects (solar, wind, and geothermal) on 
public lands with a total combined generation capacity of at least 
10,000 MW of electricity by 2015. See Section 211, Public Law 109-58, 
119 Stat. 660 (2005).
    Since passage of the EPAct, the Secretary has issued several orders 
that emphasize the importance of renewable energy development on public 
lands and the Department of the Interior's (Department) efforts to 
achieve the goal that Congress established in Section 211 of the EPAct. 
Secretarial Order No. 3283, ``Enhancing Renewable Energy Development on 
the Public Lands,'' was signed by Secretary Salazar on January 16, 
2009, and facilitates the Department's efforts to achieve the goal 
established by Congress in Section 211 of the EPAct. On March 11, 2009, 
Secretary Salazar signed Secretarial Order No. 3285, ``Renewable Energy 
Development by the Department of the Interior'' that describes the need 
for strategic planning and a balanced approach to domestic resource 
development. This order was amended by Secretarial Order 3285A1 (Order) 
in February 2010. This amended Order establishes the development of 
renewable energy on public lands as one of the Department's highest 
priorities.
    In 2012, the BLM met the goal established by Congress by approving 
over 12,000 MWs of renewable energy. However, the development of 
renewable energy is a continuing Federal priority. On June 25, 2013, to 
emphasize the importance of the renewable energy

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goals of the nation, the President announced the release of a Climate 
Action Plan to reduce carbon pollution. The Climate Action Plan set a 
new goal for the Department to approve a renewable energy capacity of 
at least 20,000 MWs of electricity on the public lands by 2020.
    The BLM has, in recent years, issued several instruction memoranda 
(IM) that identify policies and procedures related to processing solar 
and wind energy right-of-way applications. Through this rule, the BLM 
intends to incorporate many of these existing policies and procedures 
into its right-of-way regulations. The IMs can be found at http://www.blm.gov/wo/st/en/prog/energy/renewable_energy.html.
    Briefly, the IMs are as follows:
    1. IM 2009-043, Wind Energy Development Policy: This IM provides 
guidance on processing right-of-way applications for wind energy 
projects on public lands;
    2. IM 2011-003, Solar Energy Development Policy: This IM provides 
guidance on the processing of right-of-way applications and the 
administration of authorized solar energy projects on public lands;
    3. IM 2011-059, National Environmental Policy Act (NEPA) Compliance 
for Utility-Scale Renewable Energy Right-of-Way Authorizations: This IM 
clarifies NEPA policy for evaluating solar and wind energy project 
right-of-way applications;
    4. IM 2011-060, Solar and Wind Energy Applications--Due Diligence: 
This IM provides guidance on the due diligence requirements for solar 
and wind energy development right-of-way applications; and
    5. IM 2011-061, Solar and Wind Energy Applications--Pre-Application 
and Screening: This IM provides guidance on the review of right-of-way 
applications for solar and wind energy development projects on public 
lands. More recently, Secretary Jewell signed Secretarial Order No. 
3330, ``Improving
Mitigation Policies and Practices of the Department of the Interior.'' 
In it, the Secretary established principles for the use of the 
mitigation strategies when considering the deployment of 
infrastructure, particularly large-scale applications, that impact 
natural resources and should incorporate a landscape-scale approach to 
mitigation compliance. The process proposed within this rule allows for 
the inclusion of landscape-scale approach and other mitigation actions 
on the public land.
    Further, the President issued Executive Order 13604, ``Improving 
Performance of Federal Permitting and Review of Infrastructure 
Projects.'' The President established executive policy to improve the 
permitting and review processes across multiple agencies to reduce the 
aggregate time required to make permitting and review decisions on 
projects. In the policies, improved outcomes for communities and the 
environment were addressed. The policies compelled the agencies to 
improve practices such as ``pre-application procedures, early 
collaboration with other agencies, project sponsors, and affected 
stakeholders and coordination with State, local and tribal 
governments.''
    In addition, the BLM has completed two programmatic EISs related to 
wind and solar energy development. These programmatic EISs supported 
decisions by the BLM to amend a large number of land use plans (LUP), 
which guide future BLM management actions by identifying and modifying 
desired outcomes and allowable or potential uses on public lands 
covered by a particular LUP.
    On June 24, 2005, the BLM published the Final Programmatic 
Environmental Impact Statement on Wind Energy Development on BLM-
Administered Lands in the Western United States (70 FR 36651), which 
analyzed the environmental impact of the development of wind energy 
projects on public lands in the West and identified approximately 20.6 
million acres of public lands with wind energy development potential 
(http://windeis.anl.gov). The Final Programmatic EIS and the Record of 
Decision (ROD) for Implementation of a Wind Energy Development Program 
and Associated Land Use Plan Amendments (71 FR 1768) did not identify 
specific wind energy development leasing areas, but rather identified 
areas that had potential for the development of wind energy production 
facilities, along with areas that were excluded from consideration from 
wind energy facility development because of other resource values that 
were incompatible with this use. The Programmatic EIS on Wind Energy 
Development also amended 48 BLM LUPs to incorporate wind energy 
development.
    On July 27, 2012, the BLM and the Department of Energy published 
the Notice of Availability of the Final Programmatic Environmental 
Impact Statement for Solar Energy Development in Six Southwestern 
States (Solar Programmatic EIS) (77 FR 44267), which assessed the 
environmental, social, and economic impacts associated with utility-
scale solar energy development on public lands in Arizona, California, 
Colorado, Nevada, New Mexico, and Utah (http://solareis.anl.gov). On 
October 12, 2012, the BLM and the Department issued the Solar 
Programmatic EIS ROD, which identified 17 solar energy zones (SEZs) on 
BLM managed lands, modified 89 land use plans, and described the BLM's 
intent to use a competitive offer process to facilitate solar energy 
development projects in SEZs.
    This proposed rule is one of the steps being taken by the 
Department and the BLM to promote renewable energy development on the 
public lands consistent with the BLM's multiple use mission. The 
proposed rule would also implement the suggestions for improving the 
renewable energy program made by the Office of the Inspector General 
for the Department, initially in its draft report and carried over to 
the final report (Report No. CR-EV-BLM-0004-2010) and the Government 
Accountability Office (Audit No. 361373), both of which address the use 
of competitive leasing for solar and wind development authorizations. 
The Inspector General (IG) reviewed the BLM's renewable energy 
activities to assess the effectiveness of the BLM's development and 
management of its renewable energy program. The IG also made 
recommendations on other aspects of the BLM's right-of-way program.
    The IG report discusses only wind energy projects, as the solar 
energy program was not at a stage where projects had been authorized. 
However, based on experience gained from recent authorizations for 
solar projects, the BLM believes that these recommendations also should 
apply to solar energy projects.
    Other IG recommendations pertained to the amounts and collection 
procedures for bonds covering wind energy projects. These 
recommendations included:
    1. Requiring a bond for all wind and solar projects and reassessing 
the minimum bond requirements;
    2. Tracking and managing bond information;
    3. Developing and implementing procedures to ensure that when a 
project is transferred, the BLM would return the first bond to the 
company that obtained it and request a new bond from the newly assigned 
company; and
    4. Developing and implementing Bureau-wide guidance for using 
competitive bidding on wind and solar ROWs.

For additional information, you may review the IG report and 
recommendations at: http://www.blm.gov/wo/st/en/prog/energy/renewable_energy.html.

[[Page 59026]]

    The BLM concurred with the recommendations provided by the IG 
report. The last recommendation is one of the principal reasons for 
developing this proposed rule. The other recommendations require 
changes in the BLM's operating procedures that will also be addressed 
through this rulemaking.
    Through this rulemaking, the BLM proposes to amend existing 
regulations in 43 CFR parts 2800 and 2880, and in particular:
    1. Sec.  2804.25, to establish screening criteria to prioritize 
applications for solar or wind energy development applications;
    2. Sec.  2804.30, to establish a competitive process for leasing 
public lands outside of designated leasing areas for solar and wind 
energy development;
    3. Sec.  2805.11(b), to establish a term for granting rights-of-way 
for solar or wind energy development;
    4. Sec.  2805.12(c), to establish terms and conditions for a solar 
or wind energy development grant or lease;
    5. Sec.  2805.20, to provide more detail on bonding requirements;
    6. Sec.  2806.50, to provide information on rents for solar energy 
development rights-of-way;
    7. Sec.  2806.60, to provide information on rents for wind energy 
development rights-of-way;
    8. Subpart 2809, to establish a competitive process for leasing 
public lands inside designated leasing areas for solar and wind energy 
development;
    9. Provisions in 43 CFR part 2800 pertaining to transmission lines 
with a capacity of 100 kV or more and any non-oil or gas pipeline 10 
inches or more in diameter; and
    10. Provisions in 43 CFR part 2880 pertaining to all oil and gas 
pipelines 10 inches or more in diameter.
    In addition to these amendments, the BLM is proposing technical 
changes, corrections, and clarifications to the regulations at 43 CFR 
parts 2800 and 2880. For example, the BLM is codifying the cost 
recovery authority delegated by Secretarial Order 3327. See the 
explanation of the proposed changes to ``Management Overhead Costs'' 
for more discussion on this topic.

III. Advance Notice of Proposed Rulemaking for the Competitive Solar 
and Wind Energy Development Regulations

    To solicit public comments and suggestions to assist the BLM in 
preparing the proposed regulations for competitive solar and wind 
energy leasing, the BLM published an ANPR in the Federal Register on 
December 29, 2011, and provided a 60-day comment period ending on 
February 27, 2012 (76 FR 81906). The BLM asked generally for comments 
regarding the content and structure of a competitive process for solar 
and wind energy development and specifically requested comments 
responding to the following nine questions:
    1. How a competitive process should be structured for leasing lands 
within designated solar or wind energy development leasing areas?
    2. Should a competitive leasing process be implemented for public 
lands outside of designated solar or wind energy development leasing 
areas? If so, how should such a competitive leasing process be 
structured?
    3. What competitive bidding procedures should the BLM adopt?
    4. What is the appropriate term for a competitive solar energy ROW 
lease?
    5. What is the appropriate term for a competitive wind energy ROW 
lease?
    6. Should nomination fees be established for the competitive 
process? If so, how should the fees be determined?
    7. How should the bidding process for competitive solar and wind 
energy ROW leases be structured to ensure receipt of fair market value?
    8. Should a standard performance bond be required for competitive 
solar and wind energy ROW leases and how should the bond amount be 
determined?
    9. What diligent development requirements should be included in 
competitive solar and wind energy right-of-way leases?
    In response to the above questions, 76 industry representatives, 
environmental groups, individuals, and local and State governments 
provided comments and suggestions. The BLM used this information to 
develop many components of this proposed rule. The substantive comments 
received are grouped together by the question asked and are addressed 
below. An introductory ``General Comments'' section responds to some 
comments that did not address the above nine questions. Comments 
received from this ANPR were directed at the 2800 regulations, 
specifically at solar and wind energy competitive leasing. Other 
provisions of this proposed rule were not raised in the ANPR.

General Comments

    Several comments addressed topics other than those raised by the 
nine questions in the ANPR. These comments discuss the lease rental 
rates, valuing project proposals based upon qualitative and 
quantitative factors, adequate implementation of resource protection 
measures, and providing incentives for the leasing of low conflict 
development areas.
    Some comments discussed grant and lease rental rates. Rates 
discussed in this proposed rule would be established pursuant to FLPMA 
and would be based upon known market data and calculations that are 
confirmed by a survey of market rental rates and comparable commercial 
practices. Provisions for updating the rental rates for solar and wind 
energy rights-of-way are included in this proposed rule and would be 
incorporated within any BLM grant or lease. Under the proposed rule, 
the BLM proposes a payment structure that includes both acreage rent 
and a MW capacity fee for solar and wind energy right-of-way 
authorizations.
    Some comments expressed concern that if the BLM were to adopt a 
competitive leasing process, the agency might not adequately evaluate 
the potential impacts to resources on affected public lands. The BLM 
has structured its proposed competitive processes to obtain fair market 
value, while also promoting thoughtful and reasonable development of 
the public lands and protecting important resource and other values. If 
a competitive lease is issued, the BLM would continue to comply with 
all NEPA and other statutory requirements when reviewing project-
specific plans. The designated leasing areas, which are preferred areas 
for solar or wind energy development, would be identified through the 
BLM land use planning process (43 CFR part 1600), supported by a NEPA 
analysis, and designed to minimize impacts to environmental and 
cultural resources. In addition to the environmental review associated 
with the designation of leasing areas, site specific environmental 
analyses and other appropriate studies would be done for each proposed 
lease site as stated in the proposed rule at paragraph 2809.12(b)(1).
    Likewise, several comments voiced concern that the BLM would be 
unable to adequately mitigate impacts to resources if it were to adopt 
a competitive leasing process. All grants and leases for solar and wind 
energy right-of-way authorizations would be expected to implement best 
management practices and mitigation as identified within the ROD for 
the Wind Programmatic EIS (http://windeis.anl.gov/) or Solar 
Programmatic EIS (http://solareis.anl.gov/). Furthermore, any 
additional site-specific NEPA requirements associated with an 
individual project could result in the identification of further 
mitigation measures, as applicable. It is intended that this review 
would provide

[[Page 59027]]

the careful balance between the development and protection of the 
public lands that the BLM is charged with overseeing.
    There were multiple comments regarding the BLM's proposed 
incentives for development in designated leasing areas. The BLM 
conducts an environmental review when identifying a designated leasing 
area through the planning process. This environmental review supports 
the BLM's decision to identify a designated leasing area. Project 
specific environmental reviews would be tiered from or incorporated by 
reference from this initial review to the extent practicable. The 
completion of this environmental review would be an incentive to 
develop facilities in designated leasing areas by reducing uncertainty 
regarding expected project schedules, potential resource conflicts, and 
mitigation measures, all of which could add considerably to a project 
development timeline and cost if not already captured in BLM's 
environmental review.
    Some commenters suggested development of an internal cash flow 
model for how the BLM would retain and redistribute collected funds 
within the agency. Currently, the BLM does not have authority under 
FLPMA to retain rents or fees collected from right-of-way grantees for 
the use of public lands. It is required to distribute such funds to the 
U.S. Treasury. The BLM's collection of money as a bid, fee, or rent 
does not result in the BLM retaining such funds. The BLM may retain 
funds when collecting reimbursement for processing or monitoring costs 
under Sections 304(b) and 504(g) of FLPMA or when the BLM holds funds 
for a performance and reclamation bond. Funds held for purposes of a 
performance and reclamation bond are tied to the performance 
requirements of an authorization, which would include costs such as the 
reclamation and restoration of the right-of-way.

Question 1. How should a competitive process be structured for leasing 
lands within designated solar or wind energy development areas?

    Comments responding to Question 1 of the ANPR discussed State and 
local government involvement in the process, multi-factor bidding, and 
revenue sharing with State and local governments.
    One comment recommended that the BLM coordinate with and consider 
the regulations of State, local, and tribal governments during the 
application process. The BLM's proposed rule does not affect the 
authority of State, local, or tribal governments. The BLM's ongoing 
objective is to coordinate with State, local, or tribal governments to 
the fullest extent possible when considering the issuance of rights-of-
way across Federal public lands. Under the existing regulations, 
applicants are encouraged to hold a pre-application meeting with the 
BLM and the BLM may share this information with State, local, and 
tribal governments (see section 2804.10). The proposed rule would 
require all applicants for solar and wind energy (and for any 
transmission line with a capacity of 100 kV or more, or any pipeline 10 
inches or more in diameter), as part of the pre-application meetings, 
to coordinate with appropriate Federal and State agencies and tribal 
and local governments.
    Some comments discussed competitive bidding processes to be applied 
outside of a designated leasing area and the allocation of revenue 
generated by an authorization. Of the several bidding processes 
discussed in the ANPR, the multi-factor bidding proposal received the 
most discussion. After review of comments and internal discussions, the 
BLM determined the term ``multi-factor bidding'' did not appropriately 
describe the BLM's procedures. It has been modified to align with its 
intent, which is to provide an offset to the successful bidder after 
competitive bidding has occurred. The variable offsets are discussed in 
the section-by-section analysis under section 2809.16. Bidding options 
are discussed later in the section-by-section analysis part of this 
proposed rule. Section 2804.30 outlines a competitive leasing process 
for solar and wind energy development outside of designated leasing 
areas similar to the process in subpart 2809 for lands inside 
designated leasing areas. The BLM would use the process in section 
2804.30 when there are two or more competing applications, or may start 
the process on its own initiative. The BLM may receive interest from 
the public or industry for development in an area. The BLM may also 
offer a parcel to help a state reach its goals for developing renewable 
energy.
    Under FLPMA, revenues generated from right-of-way rentals are 
deposited in the U.S. Treasury. Currently, there is no authority to 
distribute rents, fees, or bid amounts to State or local governments, 
or to the BLM. However, the proposed rule would not limit the ability 
of the BLM or other Federal agencies to seek reimbursement from project 
proponents for the costs associated with processing, inspecting, and 
monitoring right-of-way authorizations. In fact, the existing 
regulations already require reimbursement of costs associated with 
processing, inspecting, and monitoring rights-of-way under section 
2804.14.

Question 2. Should a competitive leasing process be implemented for 
public lands outside of designated solar or wind energy development 
leasing areas? If so, how should such a competitive leasing process be 
structured?

    Several commenters discussed their interest in the BLM's existing 
competitive process under section 2804.23 to remain intact and continue 
forward. They also had concerns about the recent processes established 
by the BLM under the Solar Programmatic EIS and ROD and about eminent 
domain actions. Other commenters proposed the use of a sliding scale 
for a nomination fee based upon the amount of environmental risk 
associated with a proposal. Comments were also submitted suggesting 
that the BLM should allow development outside of designated leasing 
areas based upon a determination of the project's economic viability.
    The proposed rule would codify new procedures for the competitive 
process currently being implemented on public lands outside of 
designated leasing areas and establish a similar process for lands 
inside designated leasing areas. The proposed rule would also clarify 
the circumstances in which a competitive process may be used outside of 
designated leasing areas.
    When developing the proposed rule, the BLM considered the solar 
variance process that was established by the Solar Programmatic EIS and 
ROD. The Solar Programmatic EIS and ROD identified variance areas as 
lands outside of SEZs (a type of designated leasing area) that may be 
suitable for solar energy development. The Solar Programmatic EIS and 
ROD accounted for avoidance and exclusion areas when identifying 
variance lands. The variance process established in the Solar 
Programmatic EIS ROD is the process by which the BLM evaluates 
applications for solar energy development in variance areas. The 
existing solar variance process and proposed rule are intended to be 
compatible and complement each other when the BLM processes an 
application for solar energy development.
    One commenter expressed concern over potential BLM eminent domain 
actions on private land in areas where public and private lands are 
interspersed. The BLM's authority does not extend beyond the boundaries 
of BLM managed public lands. The

[[Page 59028]]

proposed rule is intended to provide further direction on the 
management of public lands and should not be interpreted as applying to 
lands managed or owned by others. To the extent private lands are 
relevant to or necessary for a proposed use of public lands, it would 
be the responsibility of an applicant who proposes the use of BLM 
managed public lands to also secure the necessary rights over the 
adjacent private lands. No authorization from the BLM can confer such 
rights.
    Some comments expressed concern that the BLM was determining 
whether projects are economically viable if located inside or outside a 
designated leasing area and questioned the differences in environmental 
conditions between lands inside and outside a designated leasing area.
    The BLM would identify areas that have a high potential for solar 
or wind energy development, but would not determine the economic 
viability of developing a project in these areas. Any determination of 
a project's economic viability would be left to the prospective 
developers.
    The BLM would, however, identify locations that have fewer and less 
significant adverse resource impacts and are suitable for solar or wind 
energy development. The BLM would identify these areas through the land 
use planning process, which includes a supporting environmental review. 
The BLM and the Department issued the Solar Programmatic EIS ROD, which 
identified 17 SEZs on BLM managed lands, modified 89 land use plans, 
and described the BLM's intent to use a competitive process to 
facilitate solar energy development projects in SEZs.
    Lands outside of designated leasing areas are not closed to solar 
and wind energy development, but would not benefit from the completed 
environmental review of the land use planning process and may, 
therefore, have greater resource conflicts. Greater resource conflicts 
are likely to increase an applicant's costs, as well as the BLM review 
period.
    Outside of designated leasing areas, the BLM would prioritize solar 
and wind energy applications based upon categories of screening 
criteria, as discussed in the section-by-section analysis. While this 
is not a sliding scale as suggested by commenters, an application may 
be reprioritized based on new information provided or identified in the 
processing of an application. Prioritizing applications would focus the 
BLM's efforts on those applications that are likely to have lesser 
resource conflicts before those with potentially greater impacts.

Question 3. What competitive bidding procedures should the BLM adopt?

    In response to the request for comments on competitive bidding 
procedures, the BLM received several recommendations to model the 
competitive procedures of solar and wind energy development after the 
geothermal or oil and gas leasing programs. One commenter discussed the 
merit in allowing bidding on single or multiple tracts at a time. In 
addition to the recommendations for methods of competitive procedures, 
several commenters discussed appropriate methodologies for valuing 
public lands made available for competitive offering.
    When developing the proposed competitive bid procedures, the BLM 
considered the bidding processes used by programs for offshore 
renewable energy, onshore oil and gas, and geothermal mineral leasing, 
and also past competitive actions for rights-of-way. Though these 
programs are guided by different statutes, regulations, and policies, 
the BLM's proposed competitive bid processes for rights-of-way have 
incorporated procedures used by the oil and gas and geothermal leasing 
programs, some of which were described in the ANPR. For example, 
similar to the BLM's oil and gas program, a notice placed in both a 
local newspaper and the Federal Register would provide specific 
instructions to interested parties on the required methodology and 
procedures to file for a pending competitive offer.
    The BLM, through this proposed rule, intends to identify the 
methods by which it may competitively offer rights-of-way inside 
designated leasing areas. However, the proposed rule is written so as 
to not unnecessarily limit the BLM's ability to competitively offer 
lands for solar and wind energy development. The BLM may tailor the 
competitive leasing offer to meet the needs of the agency, prospective 
developers, and the interests of the public. For example, when a notice 
is provided in a local newspaper and the Federal Register, the BLM 
could announce whether it would accept bids on single or multiple 
tracts of public land and whether variable offsets would be provided 
for a preferred technology.

Questions 4 and 5. What is the appropriate term for a competitive solar 
energy ROW lease? What is the appropriate term for a competitive wind 
energy ROW lease?

    Most of the commenters agreed that the duration of both solar and 
wind energy development right-of-way lease terms should be no less than 
20 years and no more than 30 years. The proposed rule would establish a 
term of 30 years inside designated leasing areas, and up to 30 years 
outside of designated leasing areas.

Question 6. Should nomination fees be established for the competitive 
process? If so, how should the fees be determined?

    Most commenters felt that a nomination fee should be established 
for a competitive process for solar and wind energy development. 
However, those commenters that agreed with a nomination fee had 
different suggestions for how the nomination fee should be configured. 
Most commenters indicated that they would support a nomination fee if 
the fee was reasonable. The BLM's proposed nomination fees are 
discussed in the section-by-section analysis under section 2809.11.

Question 7. How should the bidding process for competitive solar and 
wind ROW leases be structured to ensure receipt of fair market value?

    The BLM received a variety of different comments discussing 
Question 7. Some commenters discussed instituting a bidding process 
while others opposed it. Some commenters recommended that the agency 
consider not implementing a bidding process once an application is 
submitted.
    The BLM considered not implementing a competitive process once an 
application for solar or wind energy development has been submitted. 
Existing regulations allow the BLM to implement a competitive process 
when there are two or more competing applications for the same facility 
or system. The rules would still have this provision, and under the 
proposal, the BLM would also be able to implement a competitive process 
on its own initiative. FLPMA directs the BLM to receive fair market 
value for right-of-way authorizations on the public lands and the 
recommendation not to offer rights-of-way competitively could prevent 
the BLM from doing so. The BLM is more likely to receive fair market 
value through a combination of the competitive process and the rents 
and MW capacity fees described in this proposed rule. Section 2804.23 
describes when the BLM would implement a competitive process outside of 
designated leasing areas. Section 2809.19 describes how the BLM would 
process applications on lands that are subsequently identified as 
designated leasing areas.
    Some commenters suggested alternative methodologies for

[[Page 59029]]

determining the value of using public lands for solar or wind energy 
development, including valuing a proposed right-of-way based on 
adjacent land uses or the appraised value of the past uses of the land.
    In this rule, the BLM proposes a structure where the fair market 
value of a right-of-way authorization would be reflected by all of the 
components of the competitive offer i.e., the minimum bid, bonus bid, 
acreage rent, and a MW capacity fee. The combination of these 
components is intended to result in the Government's receipt of fair 
market value for the use of the public lands for solar and wind energy 
development. The BLM has determined competitive offers provide a more 
accurate assessment of fair market value for solar and wind energy 
rights-of-way than valuations of adjacent lands.
    Other commenters indicated that the BLM should develop an internal 
cash flow model for specific technology types, on a State-by-State or 
regional basis to achieve fair market value. Comments also indicated 
that the BLM should match or stay above other competitively offered 
lease prices, utilizing a minimum bid rate.
    As part of this rule, the BLM has proposed rents and fees specific 
to the different solar and wind energy technology types. The BLM 
proposes a MW capacity fee, based on the number of approved MWs of 
capacity for the energy development, and an acreage rent, based on the 
number of acres authorized for the right-of-way. The acreage rent would 
be based on the existing linear rent schedule, which is determined on a 
regional basis to reflect the value of the land. The MW capacity fees 
and acreage rents would be different for solar and wind energy based 
upon technology type and encumbrance factors. See sections 2806.50 and 
2806.60 for more information on the solar and wind right-of-way rents 
and fees. The proposed combination of rent, MW capacity fees, and bids 
proposed by this rule is not intended to require a value greater than 
other competitively offered parcels, but rather to represent fair 
market value.

Question 8. Should a standard performance bond be required for 
competitive solar and wind energy ROW leases and how should the bond 
amount be determined?

    Most commenters stated that a standard performance bond should be 
required for competitive solar and wind energy development right-of-way 
leases. Several comments suggested that a bond should be required for 
the cost of restoring the land to its original condition. Other 
comments suggested that bond amounts should be based on project 
development costs. Several comments also suggested that a bond 
requirement would encourage viable proposed solar and wind energy 
development projects by committed applicants. There were a few comments 
suggesting that bonds should not be required because of uncertainty as 
to what bonds were to cover, and other comments recommended that the 
BLM should continue to use its existing bond requirements.
    The proposed rule describes bonding requirements and addresses the 
elements the BLM would consider when establishing a bond amount. The 
BLM considered the comments submitted under the ANPR and determined 
that a bond would be required for each solar and wind energy 
authorization, including a minimum bond amount. A minimum bond amount 
would be established for grants on lands outside of designated leasing 
areas. This minimum bond amount would be the same as the standard bond 
amount for leases on lands inside designated leasing areas. These 
amounts are discussed in greater detail in the section-by-section 
analysis under section 2805.20. The bond amount for grants on lands 
outside designated leasing areas would be based on a reclamation cost 
estimate (RCE), which estimates the costs for reclaiming and restoring 
the public lands. This amount would include the administrative costs 
for the BLM to administer a contract to reclaim and restore the lands 
in the authorization. The minimum bond amount is based on an average of 
RCEs for existing projects.
    The BLM considered establishing bond amounts based upon other 
costs, such as costs to develop a project. However, the BLM rejected 
this idea since these and other suggested costs and methods for 
establishing bond amounts were based on construction costs and were not 
specific to the reclamation and restoration requirements of a project 
or an indication of reasonable costs to do so on BLM-managed public 
lands. The proposed minimum bond amounts are based on an average of the 
RCEs for existing projects.

Question 9. What diligent development requirements should be included 
in competitive solar and wind energy right-of-way leases?

    Comments on diligent development requirements for leases focused on 
the BLM notification to potential bidders before a competitive offer is 
made. Comments expressed interest in timeframes for the start and 
completion of development requirements, such as construction deadlines, 
once a lease is offered to the successful bidder. Some comments 
indicated that the BLM should enforce benchmarks, deadlines, or other 
criteria.
    The BLM is proposing diligent development requirements for a 
competitively offered lease for solar or wind energy development. For 
example, the proposed regulations would require that a plan of 
development (POD) be submitted to the BLM within 2 years and that the 
proposed energy development be operational within 10 years of the lease 
issuance. Other site-specific requirements may be disclosed in the 
notice offering the lands for a competitive offer.
    Existing regulations (section 2807.16) provide the BLM with 
authority to suspend or terminate a right-of-way authorization if the 
holder does not comply with the terms and conditions of the grant, such 
as a POD. A suspension or termination of a solar or wind energy right-
of-way would cause a right-of-way holder to lose profits and 
potentially increase their cost of operations. The BLM does not propose 
to establish monetary penalties to enforce diligent development or 
established benchmarks or criteria.

IV. General Discussion and Section-by-Section Analysis

General Discussion

    The BLM's existing right-of-way regulations provide only limited 
authority to use a competitive bidding process when authorizing solar 
and wind renewable energy facilities. Specifically, the existing 
regulations (see 43 CFR 2804.23(c)) allow the BLM to use a competitive 
bidding process only when it has already received two or more competing 
right-of-way applications for the same facility or system. This 
proposed rule would expand the BLM's ability to use competitive bidding 
processes, including competitive bidding for solar and wind energy 
development grants and leases. While this proposed rule includes 
provisions that apply to all rights-of-way, the focus of this rule is 
primarily on solar and wind energy development. It would codify 
existing BLM policies and provide additional detail pertaining to a 
competitive process for seeking solar or wind energy development grants 
outside designated leasing areas. In addition, it would establish a 
competitive process for seeking solar and wind energy development 
leases inside designated leasing areas.

[[Page 59030]]

    The term ``designated leasing area'' would be defined at section 
2801.5(b) as ``a parcel of land with specific boundaries identified by 
the BLM land use planning process as being a preferred location for 
solar or wind energy development that must be leased competitively.'' 
Similar to right-of-way corridors, designated leasing areas would be 
identified as appropriate areas for development while minimizing 
cultural and environmental impacts through avoidance, minimization, and 
compensatory mitigation. The BLM's preliminary review of these areas, 
and its determinations that these areas are suitable for renewable 
energy development, are intended to provide an incentive to renewable 
energy developers looking for a potential site to develop. Site-
specific NEPA analysis would still be required for each right-of-way, 
but the BLM's preliminary review and land management suitability 
determinations would streamline subsequent site-specific NEPA analysis 
and could save the developer time and money.
    Solar and wind energy development inside designated leasing areas 
would be authorized using the competitive offer process that would be 
established in proposed 43 CFR subpart 2809. Another competitive 
process for lands outside designated leasing areas would be established 
in proposed section 2804.30. Both processes would enable the BLM, on 
its own initiative, to offer lands competitively for solar or wind 
energy development.
    After deciding to offer either type of lands competitively, the BLM 
would publish a notice of competitive offer in accordance with new 
section 2804.30(d) that would be used in conducting the auction or 
competitive bidding. This notice would include the date, time, and 
location, as well as the process and procedures of the competitive 
offer. The BLM would accept a bid only if it included payment for the 
minimum bid and at least 20 percent of the bonus bid.
    The minimum bid would consist of: (1) Administrative costs incurred 
by the BLM and other Federal agencies in preparing for and conducting 
the competitive offer; and (2) An amount determined by the BLM based on 
known or potential values of the parcel. The bonus bid would consist of 
any dollar amount that a bidder decides to bid in addition to the 
minimum bid.
    For lands outside designated leasing areas, the bidder who submits 
the highest total bid would become the preferred applicant. The 
preferred applicant is the only party who may submit a right-of-way 
application for the parcel identified in the notice of competitive 
offer on which it was the highest bidder. A preferred applicant who 
completes the application process may be offered a grant, at the BLM's 
discretion.
    In contrast, for lands inside designated leasing areas, the bidder 
who submits the highest total bid would be offered a lease, provided 
that qualifications and payment terms are met. The BLM would offer a 
lease in designated leasing areas as an incentive for development in 
these preferred areas. These lands would have undergone sufficient 
cultural and environmental review to offer the successful bidder a 
lease that ordinarily would not require further evaluation. As noted, 
site-specific NEPA analysis would still be required for each right-of-
way and could be tiered from the BLM's preliminary review and land 
management suitability determinations. This streamlined process would 
save the applicant time and money. Lands outside of designated leasing 
areas would not have yet undergone the preliminary environmental and 
cultural review provided by the planning process.
    In addition, new section 2809.16 of this proposed rule would 
provide that a successful bidder for lands inside a designated leasing 
area may qualify for variable offsets totaling up to 20 percent of the 
total bid. These offsets are intended to provide an incentive for 
development inside designated leasing areas and benefits to the general 
public. As envisioned, such benefits to the public would include better 
resource protection, more efficient use of the public lands, and an 
increased likelihood of project development. Requirements for 
qualifying for such offsets would be outlined specifically in the 
notice of competitive offer. Competitive offers for lands outside of 
designated leasing areas would not include variable offsets. These 
offsets are discussed in detail in the section-by-section analysis of 
this preamble.
    The rent for solar and wind energy grants and leases would comprise 
an acreage rent and a MW capacity fee. The methodology used to 
determine rents and fees for solar and wind energy, inside and outside 
of designated leasing areas, are generally the same. The main 
differences between acreage rents for lands outside and inside 
designated leasing areas are when the acreage rent is adjusted and how 
it is phased in. For lands outside of designated leasing areas, the 
acreage rent would be updated every year using the BLM's linear rent 
schedule. For lands inside designated leasing areas, the acreage rent 
would be updated in year 11 of the lease, and every 10 years 
thereafter, using the acreage rent schedule in place at the time of the 
adjustment.
    The MW capacity fees would be phased in over the course of the 
grant or lease based on changes to the MW rate. There would be a 3-year 
phase-in period for grants outside of designated leasing areas, and a 
10-year phase-in period for leases inside designated leasing areas. The 
provisions describing how acreage rents and MW capacity fees would be 
phased in are explained in greater detail in the section-by-section 
analysis.
    Bonding requirements would also differ. Inside designated leasing 
areas, the standard bond amount for solar energy developments would be 
$10,000 per acre and wind energy developments would be $20,000 per 
authorized turbine. These same amounts would be the minimum 
requirements for bonds outside designated leasing areas, and those 
minimum bonds could be subject to adjustment by the BLM under proposed 
section 2805.20(a). These bond amounts are based on an average of the 
bond requirements of existing solar or wind energy projects. The 
minimum amount outside of designated leasing areas would help ensure 
that the BLM receives an adequate bond to protect the public lands. 
Since the BLM would identify designated leasing areas as areas with 
lesser and fewer environmental and cultural resource conflicts, the BLM 
proposes a standard bond amount for solar or wind energy developments 
inside those areas. The BLM expects that if a RCE were prepared for a 
project inside a designated leasing area, the amount would not deviate 
significantly from the standard bond amount.
    The BLM intends to provide an additional level of certainty for 
right-of-way holders inside designated leasing areas and streamline the 
development process. The potential lessee could save time and money by 
not preparing a RCE.
    Under existing regulations, the BLM may adjust a bond amount to 
ensure the bond adequately protects the lands in a right-of-way. The 
BLM does not intend to adjust the standard bond amount for solar and 
wind energy leases unless there is a change in use. A change in use 
would be when a grant is amended. The removal of a wind turbine and 
subsequent reclamation could result in a decreased bond amount. The 
expansion of a lease area for a solar project could result in an 
increased bond amount. While the BLM intends to streamline solar and 
wind energy development on public lands, the BLM would maintain the 
ability to protect public lands.

[[Page 59031]]

    Title V of FLPMA authorizes the BLM to issue right-of-way grants, 
leases, and easements. The majority of BLM-issued rights-of-way are 
grants. The BLM intends to differentiate the rights-of-way issued under 
subpart 2809 as leases, which would be a type of grant with specific 
requirements. Communication site rights-of-way are another example of 
BLM-issued leases, which have specific regulatory requirements for rent 
and subletting.
    The following table summarizes the differences between grants 
outside designated leasing areas and leases inside designated leasing 
areas:

Differences in Processes, Terms, and Conditions Between Right-of-Way Grants and Leases for Solar and Wind Energy
                                                   Development
----------------------------------------------------------------------------------------------------------------
                                        Grants (outside            Leases (inside
                                      designated  leasing        designated  leasing     Applicable regulations
                                             areas)                    areas)
----------------------------------------------------------------------------------------------------------------
                                                All applications
----------------------------------------------------------------------------------------------------------------
Pre-application meetings.........  Mandatory for all          Does not apply..........  43 CFR 2804.10.
                                    applications.
Screening Criteria...............  Applies to all             Does not apply..........  43 CFR 2804.25 and
                                    applications.                                        2804.35.
----------------------------------------------------------------------------------------------------------------
                                               Competitive Process
----------------------------------------------------------------------------------------------------------------
BLM would identify parcels for     When there are 2 or more   After issuing a call for  43 CFR 2804.30 and
 competitive offer.                 competing applications,    nominations, or on the    subpart 2809.
                                    or on the BLM's            BLM's initiative.
                                    initiative.
Variable offset..................  Does not apply...........  Each offset (and          43 CFR 2809.16.
                                                               percent) described in
                                                               Notice of Competitive
                                                               Offer; total offset
                                                               cannot exceed 20
                                                               percent of total bid.
The successful bidder:...........  Becomes the preferred      Would be offered a lease  43 CFR 2804.30(f) and
                                    applicant and may apply    if requirements are met.  2809.15.
                                    for a grant.
----------------------------------------------------------------------------------------------------------------
                                              Terms and Conditions
----------------------------------------------------------------------------------------------------------------
Assignment rights................  Yes......................  Yes.....................  43 CFR 2807.21 and
                                                                                         2809.18(f).
Due Diligence....................  2 years to begin           2 years to submit POD, 7  43 CFR 2805.12(c)(3) and
                                    construction, 24 months    years to complete         2809.18(g).
                                    to complete construction.  construction.
Bonding..........................  Minimum bond of $10,000    Standard bond of $10,000  43 CFR 2805.20.
                                    per acre for solar/$       per acre for solar/$
                                    20,000 per authorized      20,000 per authorized
                                    turbine for wind.          turbine for wind.
Acreage Rent.....................  Adjusted annually........  Adjusted every 10 years.  43 CFR 2806.50 and
                                                                                         2806.60.
MW Fee Phase-ins.................  3 years at 25%/50%/100%..  10 years at 50%, then     43 CFR 2806.50 and
                                                               100% all subsequent       2806.60.
                                                               years.
Term Length of Grants and Leases.  Up to 30 years...........  30 years................  43 CFR 2805.11 and
                                                                                         2809.18(a).
----------------------------------------------------------------------------------------------------------------

    The above identified differences between outside and inside 
designated leasing areas are intended to provide incentives for 
development inside designated leasing areas. The BLM is soliciting 
comments as to whether these identified differences and incentives are 
appropriate for the designated leasing areas, if other incentives may 
exist, and as to whether the identified timeframes, amounts, rationale, 
and processes are appropriate for such areas.
    The BLM believes that the Federal Government will receive fair 
market value for all of the uses of public lands that could be 
authorized by the proposed rule (see 43 U.S.C. 1701 (a)(9)). The 
salient features of fair market value as referenced by the Uniform 
Appraisal Standards for Federal Land Acquisitions (1992) and the 
Appraisal of Real Estate (1992) are as follows:
    1. Fair market value is characterized as, or is representative of, 
a transaction between a knowledgeable buyer and a knowledgeable seller;
    2. Neither buyer nor seller is obligated or under duress to buy or 
sell;
    3. Fair market value is determined by a competitive market rather 
than the personal or inherent value of the property;
    4. The property is exposed to a competitive market for a reasonable 
time;
    5. Market value is only that value transferable from owner to 
owner. In most cases this means private market value; and
    6. Properties lacking buyer competition, which are likely to become 
part of a larger competition property, can be given an estimated market 
value as part of the larger property. In accordance with the market 
concept, the price paid for a similar property in an arm's-length 
transaction is accepted as the best evidence of fair market value. 
Factors to be considered in estimating value include probable demand, 
property location, and property use.
    This proposed rule would establish a framework through which the 
United States would obtain fair market value for the use of the public 
lands (See 43 U.S.C. 1701(a)(9) and 43 U.S.C. 1764(g)). The procedures 
in the proposed rule have been designed to facilitate the BLM's 
determination of fair market value through a combination of acreage 
rent (based on the number and value of acres within the authorized 
area), MW capacity fees (based on approved capacity of the solar or 
wind energy project), and any minimum and bonus bids offered during the 
competitive process. Although the BLM would collect administrative 
costs as a component of the minimum bid, these costs are not part of 
the fair market value of a parcel and would be reimbursement for 
reasonable costs for processing the authorization.
    Drawing upon its experience with solar and wind energy development 
on the public lands to date, the BLM has given careful consideration to 
the procedures to collect fair market value through a combination of 
rents, MW capacity fees, and bids (not including

[[Page 59032]]

Federal administrative costs). While the BLM's current right-of-way 
regulations provide only limited authority for the agency to use a 
competitive bidding process, through the proposed rule the BLM intends 
to develop a more detailed set of competitive procedures that will 
enhance the agency's ability to identify and receive fair market value 
by collecting minimum and bonus bids for solar and wind energy 
authorizations.
    Currently, the BLM does not have authority to retain revenues 
collected from such developments as payment to the government for the 
use of public lands. Revenue collected for solar or wind energy 
developments will be sent to the U.S. Treasury and not retained by the 
BLM. This revenue includes acreage rents, MW capacity fees, minimum 
bids and bonus bids (not including Federal administrative costs), 
application filing fees, and nomination filing fees.
    However, some funds received by the BLM for solar and wind energy 
developments would be retained or held by the BLM for its use. Such 
funds would include those received for cost recovery for the pre-
application period and the processing of an application or the 
monitoring of an authorization, bonds, Federal administrative costs for 
a competitive offer, and penalty fees for the late payment of rent and 
MW capacity fees.
    Annual rent payments are required for all solar and wind energy 
grants and leases. Acreage rent would consist of payments based on the 
value of the underlying public land encumbered by a particular project, 
which the proposed rule addresses through a set of updated and more 
detailed methods. Under the proposed rule, the BLM would identify 
acreage rent as described in the section-by-section discussion at 
2806.50 and 2806.60 of this preamble. For lands outside of designated 
leasing areas, the acreage rent would be updated every year using the 
BLM's linear rent schedule. For lands inside designated leasing areas, 
the acreage rent is updated in year 11, and every 10 years thereafter, 
using the acreage rent schedule in place at the time of the adjustment.
    The BLM would also establish a MW capacity fee using payment 
schedules based on the approved generation capacity of solar and wind 
energy grants and leases. It has been the BLM's practice under its 
current regulatory authority and policies to collect acreage and MW 
capacity payments as rent. Through this proposed rule the BLM is 
proposing to classify MW capacity payments as fees, since they reflect 
the incremental value added by the more intensive, industrial use of 
the land above and beyond the rural or agricultural value of the land 
in its unimproved state. In addition, in the BLM's experience, the 
total MW generating capacity of a project is independent of the area of 
land it occupies since the generation capacity of a project is driven 
in significant part by the technology used. The acreage payment would 
remain classified as rent under the proposed rule as it is directly 
tied to the area of public lands encumbered by the project and its 
constraints to other uses on the public lands.
    Under the competitive process that the proposed rule would 
establish for lands outside designated leasing areas, the winning bid 
amount, combined with other potential payments to the BLM over the 
course of the period of the grant, may better represent the fair market 
value. If the BLM receives no bids in a competitive offer, the lands 
could be reoffered competitively or non-competitively, if doing so is 
in the public interest (see paragraph 2804.34(h)(4)). In the absence of 
comparable transactions, an appraisal could determine whether a fair 
market value was achieved.
    For lands inside designated leasing areas, the highest bidder at 
the competitive offer would become the lessee and may qualify for and 
receive variable offsets for up to 20 percent of the winning bid 
amount. Since the potential offsets would be known to bidders before a 
competitive offer, bidders should be willing to bid higher than they 
would without the offsets.
    Assuming a scenario with sufficient competition among bidders who 
qualify for offsets, the winning bid amount minus any offsets would 
theoretically be the same as what the winning bid would have been if no 
offsets were offered. In this case, the bonus bid and the other 
payments to the BLM over the course of the lease may better represent 
the fair market value for the lease. If one or few bidders qualify for 
offsets, then it is likely that the winning bid amount minus any 
offsets would be less than what the winning bid would have been if no 
offsets were offered.
    If the BLM receives no bids on a competitive offer, the lands could 
be reoffered competitively or non-competitively, if doing so is in the 
public interest (see 2809.17(d)). An appraisal could verify whether a 
fair market value was achieved.

Section-by-Section Analysis for Part 2800

    This proposed rule would make the following changes in part 2800. 
The existing language found at section 2809.10 would be revised and 
redesignated as paragraph 2807.17(d), while revised subpart 2809 would 
be devoted to solar and wind energy development in designated leasing 
areas. This proposed rule would also amend parts 2800 and 2880 to 
clarify the BLM's administrative procedures used to process right-of-
way grants and leases. These clarifications would ensure uniform 
application of the BLM's procedures and requirements. A more in-depth 
discussion of the proposed changes is provided below.
    The following terms would be added to the definitions in section 
2801.5:
    ``Acreage rent'' is a new term that means rent assessed for solar 
and wind energy development grants and leases that is determined by the 
number of acres authorized by the grant or lease. The acreage rent is 
calculated by multiplying the number of acres (rounded up to the 
nearest tenth of an acre) within the authorized area times the per-acre 
county rate in effect at the time the authorization is issued. 
Provisions addressing adjustments in the acreage rent can be found in 
sections 2806.52, 2806.54, 2806.62, and 2806.64. An example of how to 
calculate acreage rent is discussed in this preamble in the section-by-
section analysis of paragraph 2806.52(a)(1).
    ``Application filing fee'' is a new term that means a nonrefundable 
filing fee specific to solar and wind energy right-of-way applications. 
The fee is proposed at $15 per acre for all solar and wind energy 
development applications and $2 per acre for wind site testing 
applications. The BLM would adjust the application filing fee once 
every 10 years to account for inflation. Further discussion of 
application filing fees can be found in section 2804.12.
    ``Assignment'' means the transfer, in whole or in part, of any 
right or interest in a right-of-way grant or lease from the holder 
(assignor) to a subsequent party (assignee) with the BLM's written 
approval. The proposed rule would add this definition to section 2801.5 
to help clarify existing regulations. A more detailed explanation of 
assignments and the changes made can be found under section 2807.21.
    ``Designated leasing area'' is a new term that means a parcel of 
land with specific boundaries identified by the BLM's land use plan 
process as being an area (e.g., SEZ) established, conducted through a 
landscape-scale approach, for the leasing of public lands for solar or 
wind energy development via a competitive offer. The competitive offer 
process may be found in the discussion of subpart 2809 under the 
section-by-section analysis contained in this

[[Page 59033]]

preamble. Further discussion of designated leasing areas can be found 
under section 2802.11.
    ``Designated right-of-way corridor'' is a term that is defined in 
existing regulations. The word ``linear'' has been added to this 
definition to distinguish between these corridors and designated 
leasing areas.
    ``Management overhead costs'' is defined in existing regulations as 
Federal expenditures associated with the BLM. Under Sections 304(b) and 
504(g) of FLPMA, the Secretary may require payments intended to 
reimburse the United States for reasonable costs with respect to 
applications and other documents relating to public lands. Secretarial 
Order (see Order 3327) delegated the Secretary's authority under FLPMA 
to receive reimbursable payments to the bureaus and offices of the 
Department of the Interior. This definition has been expanded to 
include other Federal agencies.
    ``Megawatt capacity fee'' is a new term meaning the fee paid in 
addition to the acreage rent for solar and wind development grants and 
leases based on the approved MW capacity of the solar or wind 
authorization. The MW capacity fee is calculated based on the MW 
capacity for an approved solar or wind energy project authorized by the 
BLM. Examples of how MW capacity fees are calculated may be found under 
the discussion of section 2806.56. While the acreage rent reflects the 
value of the land itself, the MW capacity fee reflects the value of the 
industrial use of the property to generate electricity.
    ``Megawatt rate'' is a new term that means the price of each MW for 
various solar and wind energy technologies as determined by the MW rate 
schedule. The MW rate equals the number of hours per year multiplied by 
the net capacity factor multiplied by the MW per hour (MWh) price 
multiplied by the rate of return where: The net capacity factor is the 
average operational time divided by the average potential operational 
time of a solar or wind energy development facility multiplied by 
current technology efficiency rates. The net capacity factor for each 
technology type is:
    a. Photovoltaic (PV) = 20 percent;
    b. Concentrated photovoltaic (CVP) and concentrated solar power 
(CSP) = 25 percent;
    c. Concentrated solar power with storage capacity of 3 hours or 
more = 30 percent; and
    d. Wind energy = 35 percent.
    1. The MWh price equals the 5-year average of the annual weighted 
average wholesale price per MWh for the major Intercontinental Exchange 
(ICE) or its successor in interest at trading hubs serving the 11 
Western States of the continental United States (see proposed paragraph 
2806.52(b)). The wholesale price of electricity is tracked daily on the 
ICE and is readily accessible at https://beta.theice.com/marketdata/reports/ReportCenter.shtml. Should the ICE or its successor in interest 
discontinue tracking the wholesale price of electricity, the 5-year 
average of the annual weighted average wholesale price per MWh would be 
calculated using comparable market prices.
    2. The rate of return is the relationship of income (to the 
property owner, or in this case the United States) to the revenue 
generated from authorized solar and wind energy development facilities, 
based on the 10-year average of the 20-year U.S. Treasury bond yield, 
rounded to the nearest one-half percent.
    3. The number of hours per year is a fixed number (i.e., 8,760 
hours, the total number of hours in a 365-day year).
    The BLM is considering basing the net capacity factors for these 
technologies on an average of the annual capacity factors listed by 
Energy Information Administration (EIA). The EIA posts an average of 
the capacity factors on its Web site at http://www.eia.gov/electricity/monthly/epm_table_grapher.cfm?t=epmt_6_07_b.
    ``Performance and reclamation bond'' is a new term that means the 
document provided by the holder of a right-of-way grant or lease that 
provides the appropriate financial guarantees, including cash, to cover 
potential liabilities or specific requirements identified by the BLM. 
This term is defined here to clarify the expectations of what a bond 
accomplishes.
    The definition would also explain which instruments would or would 
not be acceptable. Acceptable bond instruments include cash, cashiers 
or certified check, certificate or book entry deposits, negotiable U.S. 
Treasury securities, surety bonds from the approved list of sureties, 
and irrevocable letters of credit. The BLM would not accept a corporate 
guarantee. These provisions would codify the BLM's existing procedures 
and practices.
    ``Reclamation cost estimate (RCE)'' is a new term that means the 
report used by the BLM to estimate the costs to restore the intensive 
land uses on the right-of-way to a condition that would support pre-
disturbance land uses.
    ``Right-of-way'' is defined in existing regulations as the public 
lands the BLM authorizes a holder to use or occupy under a grant. The 
revised definition would describe the authorization as ``a particular 
grant or lease.''
    ``Screening criteria for solar and wind energy development'' is a 
term that refers to the policies and procedures that the BLM would use 
to prioritize how it processes solar and wind energy development right-
of-way applications outside of designated leasing areas. Some examples 
of screening criteria are:
    1. Applications filed for areas specifically identified for solar 
or wind energy development, other than designated leasing areas;
    2. Previously disturbed areas or areas located adjacent to 
previously disturbed areas;
    3. Lands currently designated as Visual Resource Management (VRM) 
Class IV; and
    4. Lands identified for disposal in a BLM land use plan.
    Screening criteria for solar and wind energy development have been 
established by policy through IM 2011-61, and are further discussed in 
paragraph 2804.25(d)(2) and section 2804.35 of this proposed rule. The 
IM may be found at http://www.blm.gov/wo/st/en/prog/energy/renewable_energy.html.
    ``Short term right-of-way grant'' is a new term that means any 
grant issued for a term of 3 years or less for such uses as storage 
sites, construction sites and short-term site testing and monitoring 
activities. The holder may find the area unsuitable for development or 
the BLM may determine that a resource conflict exists in the area.
    The scope section of the regulations in part 2800 is clarified in 
the proposed changes to section 2801.6. The additional language 
clarifies that the regulations in this part would apply to all systems 
and facilities identified under paragraph 2801.9(a).
    Section 2801.9 explains when a grant or lease is required for 
systems or facilities on public lands. Paragraph 2801.9(a)(4), systems 
for generation, transmission and distribution of electricity, would be 
expanded to include solar and wind energy development facilities and 
associated short-term actions. Language would also be added to 
paragraph 2801.9(a)(7) to allow any temporary or short-term surface-
disturbing activities associated with any of the systems described in 
this section. A new paragraph (d) would be added to specifically 
describe the types of authorizations required for various components of 
solar and wind energy development projects. These are:
    1. Short term authorizations (term to not exceed 3 years),
    2. Long term right-of-way grants (up to 30 years); and

[[Page 59034]]

    3. Solar and wind energy development leases (30 years).
    This paragraph also describes the type of authorizations for solar 
and wind projects located both inside and outside of designated leasing 
areas. Authorizations for solar or wind energy development located 
outside of a designated leasing area would be issued as a right-of-way 
grant for a term of up to 30 years. Authorizations located inside of a 
designated solar or wind energy development would be issued as a right-
of-way lease for a term of 30 years.
    Section 2802.11, which explains how the BLM designates right-of-way 
corridors, would be revised to include ``designated leasing areas.'' 
The BLM would identify designated leasing areas as preferred areas for 
solar or wind energy development, based on a high potential for energy 
development and lesser resource impacts. This section provides the 
factors the BLM considers when determining which lands may be suitable 
for right-of-way corridors or designated leasing areas. These factors 
are unchanged from the existing regulations.
    Paragraphs (a), (b), (b)(3), (b)(4), (b)(6), (b)(7) and (d) of this 
section would be amended to include references to designated leasing 
areas. Existing regulations specifically mention right-of-way corridors 
in these paragraphs. These revisions would clarify that this section 
would apply to designated leasing areas in addition to linear right-of-
way corridors.
    Existing section 2804.10 encourages prospective applicants for a 
right-of-way grant to schedule and hold a pre-application meeting. As 
revised in this proposed rule, section 2804.10 would continue to 
encourage pre-application meetings regarding some right-of-way grants, 
but would require two or more such meetings for:
    1. Any solar or wind energy grant outside a designated leasing 
area;
    2. Any transmission line with a capacity of 100 kV or more; or
    3. Any pipeline 10 inches or more in diameter.
    Under existing paragraph 2804.10(a)(2), the BLM determines if your 
application is on land within a right-of-way corridor. This paragraph 
would be revised to include ``or a designated leasing area.'' The BLM 
would not accept applications for grants on lands inside designated 
leasing areas (see the section-by-section analysis of paragraph 
2809.19(b) for further discussion).
    Proposed paragraph 2804.10(a)(4) would be amended by adding a 
reference to proposed paragraph 2804.10(b). The existing paragraph 
states that the BLM may inform you of financial obligations, such as 
processing and monitoring costs, rent, and mitigation. The reference 
would reiterate that applicants must pay the reasonable costs 
associated with proposed paragraph 2804.10(b), or may elect to pay the 
full actual costs.
    Under paragraph 2804.10(b), applicants for right-of-way grants for 
solar or wind energy development (outside of designated leasing areas), 
any transmission line with a capacity of 100 kV or more, or any 
pipeline 10 inches or more in diameter, must hold two or more pre-
application meetings. These types of authorizations are generally 
larger and more complex than the average right-of-way authorization, 
and this extra step would help protect the public lands and make 
application processing more efficient.
    The BLM would not accept an application until all pre-application 
meetings are held and the applicant complies with the grazing permittee 
early notification requirement found at 43 CFR 4110.4-2(b). Applicants 
must pay reasonable costs associated with the pre-application 
requirements identified in paragraph (b) of this section, with the 
option of paying the-actual costs. Payment for reasonable costs 
associated with pre-application requirements would be paid prior to the 
first pre-application meeting.
    After the enactment of the Energy Policy Act of 2005, the BLM 
received an influx of solar and wind energy development applications. 
Many of these applications were unlikely to be approved due to issues 
such as siting, environmental impacts and lack of involvement with 
other interested parties. As the BLM gained more experience with these 
applications it developed policies to process applications more 
efficiently. These policies required pre-application meetings and 
application screening criteria (see section 2804.35).
    Mandatory pre-application meetings helped the BLM and prospective 
applicants identify necessary resource studies, and other interests and 
concerns associated with a project. Further, the pre-application 
meetings provided an opportunity to direct development away from lands 
with high conflict or sensitive resource values. As a result of these 
meetings, the applications submitted were better sited and had fewer 
resource issues than those submitted where no pre-application meetings 
were held. Holding these meetings early in the process made the 
applications more likely to be approved by the BLM. This saved the 
applicant the time and money spent when doing resource studies and 
developing projects that may not be accepted or approved by the BLM.
    Some prospective applicants chose not to pursue a development after 
these meetings after they had a better understanding of the potential 
issues and resource conflicts with the project as proposed. The BLM 
found that applicants who participated in pre-application meetings 
saved money that would have been spent planning a development that the 
BLM would not have approved. This also saved the BLM time by reducing 
the number of applications they would process and the time spent 
reviewing resource studies and project plans.
    The Government Accountability Office report (GAO-13-189), submitted 
in January 2013, found that the average BLM permitting timeframes have 
decreased since implementation of its solar and wind energy policies, 
which include the pre-application and application requirements in this 
proposed rule.
    In review of the BLM's experiences with renewable energy 
development, transmission lines larger than 100 kV, and pipelines 
larger than 10 inches in diameter, holding pre-application meetings 
save both the BLM and a developer time and money. The GAO concluded 
that applications submitted in 2006 averaged about 4 years to process. 
Applications submitted in 2009 and later averaged about 1.5 years to 
process. Further, the BLM has reviewed its records for cost recovery of 
these renewable energy, transmission and pipeline projects and 
identified a range of costs and time associated with each type of 
application for the public lands. These ranges vary between the solar 
and wind energy, transmission line, and pipeline projects. For solar 
and wind energy a range of costs was identified between $40,000 and $4 
million including up to approximately 40,000 BLM staff labor hours and 
other non-labor costs per project. For transmission lines 100 kV or 
larger and pipelines 10 inches or larger, a range of costs was 
identified between $260,000 and $3.2 million including up to 
approximately 32,000 BLM staff labor hours and other non-labor costs 
per project.
    Based on the BLM's experience, two pre-application meetings would 
usually be sufficient to address all potential concerns with a project. 
However, the BLM understands that additional pre-application meetings 
may be beneficial to a project before an application is submitted. The 
BLM does not want to limit its ability to hold additional meetings 
should a project be

[[Page 59035]]

particularly complex and has allowed for additional pre-application 
meetings to be held when mutually agreed upon by the BLM. For example, 
a project that crossed State lines could require additional 
coordination with local governments and other interested parties.
    The burden on prospective applicants would be limited. In advance 
of the first pre-application meeting, they would need to collect 
information about the general project proposal (see section 
2804.10(b)(1)(i)). The BLM would be in the best position to know, and 
thus would be primarily responsible for collecting and communicating, 
the rest of the required information:
     The status of BLM land use planning for the lands 
involved;
     Potential siting issues or concerns;
     Potential environmental issues or concerns;
     Potential alternative site locations; and
     The right-of-way application process.
    One or more additional pre-application meetings would be held with 
the BLM and other Federal, State, tribal, and local governments to 
facilitate coordination. This requirement would provide an opportunity 
for a prospective applicant to describe the general project proposal 
(i.e., information that has already been collected), and for the BLM 
and the prospective applicant to learn generally the views of various 
governmental entities. Again, the burden for prospective applicants 
would be limited. Paragraph 2804.10(c) would explain requirements for 
submitting an application for solar or wind energy development 
projects, for any transmission line with a capacity of 100 kV or more, 
or for any pipeline 10 inches or more in diameter. This provision would 
codify the existing policies and provide clear instructions to the 
public about what they should expect during the application process.
    The BLM would accept an application only if the following 
conditions are met. The written proposal must address known potential 
resource conflicts with sensitive resources and values that are the 
basis for special designations or protections, and include applicant-
proposed measures to avoid, minimize, and mitigate such resource 
conflicts. For example, some applicant proposed measures could utilize 
a landscape level approach as conceptualized by Secretarial Order 3330 
and subsequent reports, and consistent with the BLM's IM 2013-142 
interim policy guidance. Due to the intense use of the land from the 
projects covered in this section, the BLM would require applicants to 
identify potential conflicts and how they may be avoided, minimized, or 
mitigated. The BLM works with applicants throughout the application 
process to ensure the most efficient use of public land and to minimize 
possible resource conflicts. This provision would require applicants to 
consider these concerns before submitting an application and therefore 
provide the BLM with potential plans to minimize and mitigate 
conflicts.
    The BLM is soliciting comments on the number of pre-application 
meetings that would be required for solar or wind energy development 
projects, for any transmission line with a capacity of 100 kV or more, 
or for any pipeline 10 inches or more in diameter. The Department of 
Energy (DOE) is currently developing a draft integrated, interagency 
pre-application (IIP) process for onshore transmission projects. The 
BLM intends to create a pre-application process that would be 
consistent with the IIP when it is proposed for transmission lines. 
However, the DOE has not yet published the IIP or other such plan for 
pre-application. The BLM will coordinate with the DOE to ensure that 
the final BLM rule is consistent with DOE's final IIP process.
    The proposal for solar energy or wind energy development must not 
be sited on lands inside a designated leasing area except as provided 
for by section 2809.19. Lands inside designated leasing areas would be 
offered competitively under subpart 2809. See section 2809.19 of this 
preamble for further discussion.
    The applicant must have completed pre-application meetings 
described in paragraphs 2804.10(b)(1) and 2804.10(b)(2) to the BLM's 
satisfaction. This paragraph would reinforce the requirements for pre-
application meetings.
    The proposal must be accompanied by a general description of the 
proposed project and a schedule for the submittal of a POD conforming 
to the POD template at http://www.blm.gov.
    The submittal of a POD is often required under the authority of the 
existing regulations at paragraph 2804.25(b). Under proposed paragraph 
2804.10(b) of this rule, PODs would always be required for 
authorizations for solar or wind energy development, any transmission 
line with a capacity of 100 kV or more, or any pipeline 10 inches or 
more in diameter. The new requirement in paragraph 2804.10(c)(4) is for 
a more general summary of the project, using the information available 
at the time of submittal. A POD conforming to the BLM's template would 
be submitted later, in accordance with the approved schedule.
    Proposed paragraph 2804.12(a)(8) would require that an applicant 
submit a non-refundable application filing fee with any solar or wind 
energy right-of-way application. Section 304 of FLPMA authorizes the 
BLM to establish filing and service fees. A per-acre application filing 
fee would discourage applicants from applying for more land than would 
be necessary for the proposed project. Revenue collected for 
application filing fees will be sent to the U.S. Treasury and not 
retained by the BLM as this is not a cost recovery fee. A similarly 
structured nomination fee inside designated leasing areas is 
established following the same criteria and is described in paragraph 
2809.11(b)(1).
    The application filing fee is based on the appraisal consultation 
report performed by the Department's Office of Valuation Services. The 
appraisal consultation report compared similar costs on private lands, 
and provided a range between $10 and $25 per acre per year. The nominal 
range or median was reported as $15-$17 per acre per year. The 
appraisal consultation report is available for review by contacting 
individuals listed regarding the substance of the proposed rule under 
the FOR FURTHER INFORMATION CONTACT heading section of this preamble.
    The BLM is proposing to adopt a single filing fee at the time of 
filing an application, as opposed to a yearly payment. Based on the 
appraisal consultation report, fees are proposed at $15 per acre for 
solar and wind energy applications and $2 per acre for wind energy 
project area and site specific testing applications.
    Fees for solar and wind energy development applications would be 
adjusted for inflation once every 10 years using the Implicit Price 
Deflator for Gross Domestic Product (IPD-GDP). The average change in 
the IPD-GPD from 1994-2003 is 1.9 percent which would be applicable 
through 2015.
    Paragraph 2804.12(a)(9) would be added to clarify existing 
requirements, as well as to complement new provisions. Under existing 
paragraph 2804.25(b), the BLM may require an applicant to submit a 
general description of the project POD. This new requirement in 
paragraph 2804.12(a)(9) states that if the BLM requires you to submit a 
POD, you must include a schedule for its submittal in your application.
    Under the existing regulations at section 2804.14, applicants must 
pay the BLM for its reasonable costs, as defined by FLPMA, of 
processing an application. New paragraph 2804.14(a)

[[Page 59036]]

gives the BLM discretion to collect the estimated reasonable costs 
incurred by other Federal agencies. Secretarial Order 3327 delegated 
the Secretary's FLPMA cost reimbursement authority to Interior 
agencies, who often work together on projects with joint jurisdiction. 
Applicants may pay those costs to the other affected agencies directly 
instead of paying them to the BLM.
    Proposed paragraph 2804.14(b) includes a table of the processing 
categories for applications. The specific costs would be removed from 
this table, while the explanations of the categories and the 
methodology of calculating the costs would remain. These numbers are 
available in writing upon request or on the BLM's Web site. The cost 
figures that would be removed are outdated, since the BLM updates these 
costs annually and has done so annually since the original rule was 
published. The revision would allow the BLM to update these numbers 
without modifying the CFR and prevent confusion to potential applicants 
who would see incorrect information. The explanation of how these costs 
are calculated, currently in paragraph 2804.14(c), would be moved up to 
paragraph (b) in order to provide better context for the amended table. 
Redundant language would be removed from the Category 1 processing fee 
in order to streamline the definition.
    As defined in section 2804.18, a Master Agreement is a written 
agreement covering processing and monitoring fees negotiated between 
the BLM and a right-of-way applicant that involves multiple BLM rights-
of-way for projects within a defined geographic area. New paragraph 
2804.18(a)(6) would require that a Master Agreement describe existing 
agreements between the BLM and other Federal agencies for cost 
reimbursement with such applications. With the recent authority 
delegated by Secretarial Order 3327 to collect costs for other Federal 
agencies, it is important for the applicant, the BLM, and other Federal 
agencies to coordinate and be consistent for cost reimbursement.
    Under paragraph 2804.19(a), an applicant for a Category 6 
application must enter into a written agreement with the BLM about how 
such applications would be processed. A new requirement would be added 
to this paragraph requiring that the final agreement must include a 
description of any existing agreements the applicant has with other 
Federal agencies for cost reimbursement associated with the 
application. The new authority delegated by Secretarial Order 3327 
requires more coordination and promotes consistency between the Federal 
agencies and this revision would help to implement this coordination.
    Under new paragraph 2804.19(e), the BLM may collect reimbursement 
to the U.S. for reasonable costs for processing applications and 
preparation of other documents under this part relating to the public 
lands. Secretarial Order 3327 authorizes the BLM to collect funds for 
other agencies for their work on applications submitted to the BLM. 
Adding this language to the CFR would clarify the BLM's authority for 
the public.
    Section 2804.20 would be amended to account for the authority 
delegated by Secretarial Order 3327, as well as new provisions in the 
proposed rule, when determining reasonable costs for processing and 
monitoring Category 6 applications. New language would include existing 
agreements with other Federal agencies for cost reimbursement 
associated with an application and costs associated with new pre-
application requirements for proposed solar or wind energy development 
projects, for any transmission line with a capacity of 100 kV or more, 
or any pipeline 10 inches or more in diameter. Processing costs would 
include reasonable costs for processing a right-of-way application, 
while monitoring costs include reasonable costs for those actions the 
Federal Government performs to ensure compliance with the terms, 
conditions, and stipulations of a right-of-way grant.
    The heading of section 2804.23 would be revised to read ``When will 
the BLM use a competitive process?'' to better reflect the subject of 
the section. Paragraph (a)(1) of this section would now require 
applicants to reimburse the Federal Government, as opposed to just the 
BLM, for processing costs. This change reflects the authority delegated 
by Secretarial Order 3327 for Interior agencies to collect money for 
processing applications made on the public land, as well as promote 
cooperation between the different Federal land management agencies.
    A new sentence in paragraph 2804.23(c) would give the BLM authority 
to offer lands through a competitive process. Under the existing 
regulations, the BLM may only use a competitive process when there are 
two or more competing applications for a single right-of-way system. 
This change gives the BLM more flexibility to offer lands competitively 
for all potential rights-of-way, not just solar and wind energy 
development projects.
    The BLM has already established competitive leasing procedures for 
the oil and gas and geothermal leasing programs, some of which were 
described in the ANPR. Though these programs are guided by different 
statutes, regulations, and policies, the BLM's proposed competitive bid 
processes for rights-of-way have appropriately incorporated procedures 
used by these programs. For example, a notice placed in both a local 
newspaper and the Federal Register would provide specific instructions 
to interested parties on the required methodology and procedures for a 
competitive offer.
    Under proposed paragraph 2804.23(d), lands outside of designated 
leasing areas may be made available for solar or wind energy 
applications through the competitive process outlined in section 
2804.30. This new provision would direct the reader to new section 
2804.30, which explains the competitive process for solar and wind 
energy development outside of designated leasing areas. This paragraph 
is necessary to differentiate between development inside and outside of 
a designated leasing area.
    Under new paragraph 2804.23(e), lands inside a designated leasing 
area would be offered competitively through the process described in 
subpart 2809. This new paragraph would direct the reader to new subpart 
2809, which would explain the competitive process for solar and wind 
energy development inside of designated leasing areas. This paragraph 
is necessary to differentiate between development inside and outside of 
a designated leasing area.
    Existing section 2804.24 explains when you do not have to use 
Standard Form 299 (SF-299) to apply for a right-of-way. Under the 
existing rule, you do not have to use SF-299 if the BLM determines 
competition exists under paragraph 2804.23(a). This only occurs when 
there are two or more competing applications for the same right-of-way 
facility or system.
    Due to the proposed changes to section 2804.23, section 2804.24 
must specify when an SF-299 is required. Under both the existing 
regulations and the proposed rule, the BLM would implement a 
competitive process if there are two or more competing applications. 
Under paragraph 2804.24(a), you would not have to submit a SF-299 if 
the BLM is offering lands competitively and you have already submitted 
an application for that facility or system.
    Under paragraph (a), if you have not submitted an application for 
that facility or system, you must submit an SF-299 as specified by the 
BLM. Under the competitive process for solar or wind energy in section 
2804.30, for example, the successful bidder becomes the

[[Page 59037]]

preferred applicant, and may apply for a grant. The preferred applicant 
would be required to submit an SF-299, but unsuccessful bidders would 
not.
    New paragraph (b) would explain that an applicant would not have to 
use an SF-299 when the BLM is offering lands competitively under 
subpart 2809. The BLM may offer lands competitively for solar and wind 
energy development inside designated leasing areas under subpart 2809. 
Under subpart 2809, the successful bidder would be offered a lease if 
the requirements described in paragraph 2809.15(d) are met. The 
successful bidder inside designated leasing areas would not have to 
submit an application using SF-299. The following chart illustrates 
under what circumstances the filing of an SF-299 would or would not be 
required:

                        When a SF-299 Is Required
------------------------------------------------------------------------
Type of solar or wind right-of-  Would have to  submit
              way                       a SF 299            Comments
------------------------------------------------------------------------
Have two or more competing       Yes..................  Outside of
 applications for the same area.                         designated
                                                         leasing areas.
Lands are offered competitively  No.                    ................
 outside of a designated
 leasing area and you have
 already submitted an
 application for the parcel
 before the Notice of
 Competitive Offer.
Lands are being offered          Yes.                   ................
 competitively outside of a
 designated leasing area and
 you have not submitted an
 application.
You are the successful bidder    Yes..................  Outside of
 and have been declared the                              designated
 preferred applicant and may                             leasing areas.
 apply for a grant.
Lands being offered              No.                    ................
 competitively within a
 designated leasing area under
 subpart 2809.
------------------------------------------------------------------------

    Under the amendments to paragraph 2804.25(b), the BLM would not 
process your application if you have any trespass action pending for 
any activity on BLM-administered lands or have any unpaid debts owed to 
the Federal Government. The only applications the BLM would process to 
resolve the trespass would be for a right-of-way as authorized in this 
part, or a lease or permit under the regulations found at 43 CFR 2920, 
but only after outstanding debts are paid. This provision would apply 
to rights-of-way, and would clarify existing regulations. Under 
existing regulations at section 2808.12, the BLM will not process any 
application for any activity on BLM-administered lands until you have 
satisfied your liability for a trespass. The requirement in section 
2808.12 is often overlooked by potential right-of-way applicants and 
this change would insert this existing requirement into the application 
process described in subpart 2804.
    Paragraph 2804.25(d) would be revised by replacing the words 
``before issuing a grant'' with ``in processing an application.'' This 
change would be made to account for the situation where the BLM would 
issue a grant without accepting applications. Lands leased inside 
designated leasing areas would be offered through a competitive bidding 
process under subpart 2809 in situations where no applications for 
those lands are received. The provisions in section 2804.25 would not 
apply to the leases issued under subpart 2809. They would apply to all 
other rights-of-way, including solar and wind energy development grants 
outside of designated leasing areas. The issuance of leases inside 
designated leasing areas will be discussed in subpart 2809.
    Paragraph 2804.25(d) also would be revised to incorporate new 
provisions for all rights-of-way as well as specific provisions for 
solar and wind energy development. Existing paragraph 2804.25(d)(5), 
which provides the requirement to hold a public meeting if there is 
sufficient public interest, would be moved to new paragraph 
2804.25(d)(1). Language would be added to specify that the public 
notice would be published in a newspaper in the area affected by the 
potential right-of-way and that the BLM may use other notification 
methods as well, such as the Internet. The former revision would 
clarify existing regulations, while the latter would expand the BLM's 
methods for notification.
    New paragraph 2804.25(d)(2) would consist of three separate 
requirements for solar and wind energy development applications. Under 
paragraph 2804.25(d)(2)(i), the BLM would hold a public meeting in the 
area affected by the potential right-of-way for all solar or wind 
energy applications. Based on the BLM's experience, most solar and wind 
energy development projects are large-scale projects that draw a high 
level of public interest. This requirement would be added to provide an 
opportunity for public involvement early in the process. Under 
paragraph (d)(2)(ii), the BLM would apply screening criteria when 
processing an application outside of designated leasing areas. These 
screening criteria are explained further in section 2804.35.
    Under new paragraph 2804.25(d)(2)(iii), the BLM would either deny 
or continue processing an application, after reviewing the input of 
other government and tribal entities, as well as information received 
in the application, public meetings, and pre-application meetings. The 
denial of an application would be in writing and would be an appealable 
decision under section 2801.10. The approval of all grant applications 
is at the BLM's discretion and the BLM would likely deny an application 
that has high potential for resource conflicts. While the BLM already 
has the authority to deny applications that have high potential for 
resource conflicts, the proposed rule would clarify to potential 
applicants how they may submit an application that is more likely to be 
approved.
    Under new paragraph 2804.25(d)(3), if an application is for solar 
or wind energy development, for any transmission line with a capacity 
of 100 kV or more, or any pipeline 10 inches or more in diameter, then 
the BLM would determine whether the POD submitted with the application 
meets the applicable development schedule and other requirements or 
whether the applicant must provide additional information. This is a 
necessary step that would be added to allow the BLM to evaluate the new 
application requirements under paragraphs 2804.10(c)(4) and 
2804.12(a)(9). The BLM would determine if the development schedule and 
other requirements of the POD templates were followed as required under 
paragraphs 2804.10(c)(4) and 2804.12(a)(9). The POD template can be 
found at http://www.blm.gov.
    Proposed paragraphs (d)(4), (d)(5), (d)(6), (d)(7), and (d)(8) of 
this section are existing provisions that would be moved to fit in with 
the other paragraphs of this section.
    The BLM is considering and seeks public comment on establishing in 
the final rule a provision that would limit

[[Page 59038]]

the time for applicants to begin conducting necessary resource studies. 
The deadline could be specific, for example 1 year after the BLM 
accepts an application. Alternatively, a time limitation could be 
stated in more general terms that would provide for greater flexibility 
on a case-by-case basis. Under this proposal, the failure to begin 
conducting such studies in the specified time frame could result in the 
BLM's denial of an application unless the BLM had previously agreed to 
a longer period of time at the request of the applicant. We are 
considering adding this time limitation to section 2804.25. We seek 
public comment on any other provisions that might be pertinent.
    Section 2804.26 explains the circumstances under which the BLM may 
deny an application. Existing paragraph 2804.26(a)(5) explains one such 
circumstance, when an applicant does ``not have or cannot demonstrate 
the technical or financial capability to construct the project or 
operate facilities in the proposed right-of-way.'' The proposed rule 
would add text to clarify this requirement, which applies to all 
rights-of-way. The new paragraphs would explain how an applicant could 
provide evidence of the financial and technical capability to be able 
to construct, operate, maintain, and decommission a solar or wind 
energy development project. The applicant may provide documented 
evidence showing prior successful experience in developing similar 
projects, provide information of sufficient capitalization to carry out 
development, or provide documentation of loan guarantees, confirmed 
power purchase agreements, and contracts for the manufacture and/or 
supply of key components for solar or wind energy project facilities. A 
specific period of time for requiring compliance with this provision 
has not been established. The BLM is soliciting comments as to what an 
appropriate time would be in such situations.
    Under new paragraph 2804.26(a)(6), the BLM may deny your 
application if you do not meet the POD submittal requirements under 
paragraphs 2804.10(c)(4) and 2804.12(a)(9). New paragraph 2804.26(a)(7) 
would reference the possible denial based on the screening criteria 
established in new paragraph 2804.25(d)(2)(iii). Paragraphs (a)(6) and 
(a)(7) would be added to this section to reiterate these new 
requirements and explain that the BLM may deny an application should an 
applicant not comply with these provisions.
    The heading of section 2804.27, ``What fees do I owe if BLM denies 
my application or if I withdraw my application?'' would be revised to 
read ``What fees must I pay if BLM denies my application or if I 
withdraw my application?'' A new provision in this paragraph would 
provide that if the BLM denies your application, or if you withdraw it, 
you must still pay any pre-application costs required under paragraph 
2804.10(a)(4), any application filing fees submitted or due under 
paragraph 2804.12(a)(8), and the processing fee set forth at section 
2804.14. Currently, the BLM is reimbursed for its costs only after a 
right-of-way application has been filed. Under the proposed rule, the 
BLM could recover the considerable expense devoted to pre-application 
work. Reimbursement for pre-application costs would ensure that the BLM 
has funds for, and could help reduce delays in performing pre-
application work. Section 304(b) of FLPMA provides for the deposit of 
payments to reimburse the BLM for reasonable costs with respect to 
applications and other documents relating to the public lands.
    New section 2804.30 would explain the process by which the BLM 
would competitively offer lands outside of designated leasing areas. 
The bidding process here is similar to the one established in subpart 
2809, except for the end result of the bidding. Under paragraph (f) of 
this section, the successful bidder would become the preferred right-
of-way applicant. Under this section, the high bidder is not guaranteed 
a grant; however, the preferred applicant is the only party that may 
submit an application for the parcel identified by the BLM under 
paragraph (g). This is different from subpart 2809, where the 
successful bidder would be offered a lease.
    Paragraph (a) of this section would identify which lands are 
available for competitive lease; paragraph (b) of this section would 
explain the variety of competitive procedure options available; and 
paragraph (c) would explain how the BLM would identify parcels for 
competitive offer. The BLM may identify a parcel for competitive offer 
if competition exists or the BLM may include lands in a competitive 
offer on its own initiative. The existing regulations only allow the 
BLM to use a competitive process when there are two competing 
applications and the changes to paragraph 2804.23(c) would give the BLM 
more flexibility. The BLM could include lands in a competitive offer in 
response to interest from the public, industry, or to facilitate State 
renewable energy goals.
    Paragraph 2804.30(d), ``Notice of competitive offer,'' establishes 
the content of the materials of a notice of competitive offer that 
include the date, time, and location (if any) of the competitive offer, 
bidding procedures, qualifications of potential bidders, and the 
minimum bid required. The notice would also explain that the successful 
bidder would become the preferred applicant and must apply for a grant 
under this subpart. This is different from the competitive offers held 
under subpart 2809 where the successful bidder is offered a lease.
    Paragraph 2804.30(d)(4) requires that the notice to provide the 
amount of the minimum bid, which would include a description of the 
administrative costs to the Federal agencies involved and what was 
provided by those administrative costs, as well as the minimum bid 
determined by the authorized officer and the rationale for how this 
minimum bid was derived. As discussed in the general discussion section 
of this preamble, the administrative costs are not a component of fair 
market value, but are cost reimbursement to the Federal Government. The 
BLM would publish a notice containing all of the identified elements in 
a newspaper of general circulation in the area affected by the 
potential right-of-way, in the Federal Register, and other notification 
methods, including use of the Internet.
    Under paragraph 2804.30(e), ``Bidding,'' the BLM would require that 
bid submissions include both the minimum bid amount and at least 20 
percent of the bonus bid. The minimum bid would consist of 
administrative costs and an amount determined by the authorized 
officer. Included in the administrative costs are those expenses 
pertaining to the development of environmental analyses and those costs 
to the Federal Government associated with holding the competitive 
offer.
    The authorized officer may specifically identify a second component 
for the minimum bid(s) submitted for each competitive offer. This 
amount would be based on the known or potential values of the offered 
parcel. The authorized officer may consider values that include, but 
are not limited to, the acreage rent, the MW capacity fee, or other 
environmental and mitigation costs of the parcel. For example, the BLM 
may have identified values in management plans, or other such 
documents, for the habitat mitigation of the desert tortoise. The 
authorized officer would have to identify these costs and provide the 
description of how the minimum bid amount was determined. An 
explanation of the minimum bid amount and how the BLM derived it

[[Page 59039]]

would be provided in the notice of competitive offer.
    Under proposed paragraph 2804.30(f), the successful bidder would be 
determined by submitting the highest total bid at a competitive offer. 
The successful bidder must fulfill the payment requirements of the 
successful bid in order to become the preferred right-of-way applicant. 
The preferred applicant must submit the balance of the bid to the BLM 
within 15 calendar days of the end of the offer.
    Under proposed paragraph 2804.30(g), the preferred applicant would 
be the only party who may submit an application for the parcel offered. 
Unlike the process under subpart 2809, the approval of a grant under 
this paragraph is not guaranteed to the successful bidder. Approval of 
a grant is solely at the BLM's discretion. The preferred applicant may 
also apply for a wind energy project area or site specific testing 
grant.
    Paragraph 2804.30(h), ``Reservations,'' describes how the BLM would 
address certain situations that could arise from a competitive offer. 
Under paragraph (h)(1) of this section, the BLM may reject bids 
regardless of the amount offered. For example, the BLM may reject a bid 
if there is evidence of conflicts of interest or collusion among 
bidders or if there is new information regarding potential 
environmental conflicts. The BLM would notify the bidder of the reason 
for the rejection and what refunds are available. If the BLM rejects a 
bid, the bidder may administratively appeal that decision.
    Under paragraph (h)(2) of this section, the BLM could make the next 
highest bidder the preferred applicant if the first successful bidder 
does not satisfy the requirements under section 2804.30(f). This could 
allow the BLM to determine a preferred applicant without reoffering the 
land and could save time and money for the BLM and potential 
applicants.
    The BLM could reoffer lands competitively under (h)(3) of this 
section if the BLM could not identify a successful bidder. If there is 
a tie, this offer could be limited to tied bidders or to all bidders. 
This would provide the BLM flexibility to resolve ties and other issues 
that could complicate a competitive offer.
    Under proposed paragraph 2804.30(h)(4), if the BLM receives no 
bids, the BLM may re-offer the lands through the competitive process in 
section 2804.30. The BLM may also make the lands available through the 
non-competitive process as described in subparts 2803, 2804, and 2805, 
if doing so is determined to be in the public interest.
    New section 2804.35 would explain how the BLM would prioritize 
review of an application for a solar or wind energy development right-
of-way based on the screening criteria for projects outside of 
designated leasing areas. The BLM would evaluate the application based 
on the screening criteria and place the application into one of three 
categories. These categories would assist the BLM in prioritizing and 
processing such applications. Applications for solar and wind energy 
development will not be accepted for lands inside designated leasing 
areas except as allowed under new section 2809.19, and therefore would 
not have such applications prioritized.
    The BLM has already established screening criteria through IM 2011-
061, which identifies their use for solar and wind energy development 
rights-of-way in order to facilitate environmentally responsible 
development by considering resource conflicts, land use plans, and 
statutory and regulatory provisions pertinent to the applications and 
the lands in question. Applications with lesser resource conflicts are 
anticipated to be less costly and time-consuming for the BLM to process 
and would be prioritized over those with greater resource conflicts. IM 
2011-061 may be found at http://www.blm.gov/wo/st/en/prog/energy/renewable_energy.html. This rule proposes criteria similar to 
those in the IM and the codification of these criteria would give 
applicants a better understanding of how their application would be 
categorized. Also, applications could be tailored to fit these 
screening criteria to streamline the processing of an application.
    High priority applications are given processing priority over 
medium and low priority applications and would consist of lands meeting 
some or all of the following criteria:
    1. Lands specifically identified for solar or wind energy 
development, outside designated leasing areas;
    2. Previously disturbed sites or areas adjacent to previously 
disturbed or developed sites;
    3. Lands currently designated as VRM Class IV; and
    4. Lands identified as suitable for disposal in the BLM's land use 
plans.
    The BLM may identify lands through the NEPA process that are 
suitable for solar or wind energy development, which are not designated 
leasing areas. Identified lands would include those which have: Been 
analyzed in a land use plan and are suitable for solar and wind energy 
development but were determined to not be made available competitively; 
received approval from the BLM for a similar development for which a 
right-of-way was never issued or the right-of-way was relinquished, or; 
been returned from a designated leasing area back to lands not 
identified for solar or wind energy completion.
    VRM factors would address situations where the construction of 
solar or wind facilities would have low impacts to the environment and 
are in areas that have few or no resource values or areas needing 
protection from development. The VRM inventory process is a means to 
determine visual resource values. The VRM inventory consists of a 
scenic quality evaluation, sensitivity level analysis, and a 
delineation of distance zones. Based on these three factors, BLM-
administered lands are placed into one of four VRM classes, with 
Classes I and II being the most valued, Class III representing a 
moderate value, and Class IV being of least value. The BLM assigns VRM 
classes through the land use planning process and these values can 
range from areas having few scenic qualities to areas with exceptional 
scenic quality.
    Under the proposed rule, medium priority applications would be 
considered before low priority applications, based on the following 
criteria:
    1. BLM special management areas that provide for limited 
development or where a project may adversely affect lands having value 
for conservation purposes, such as historical, cultural, or other 
similar values;
    2. Right-of-way avoidance areas;
    3. Sensitive plant or animal habitat areas; and
    4. Lands designated as VRM Class III.
    Low priority applications may not be feasible to authorize due to a 
high potential for conflict. Examples of applications that may be 
assigned low priority would involve:
    1. Lands near or adjacent to areas designated by the Congress, the 
President, or the Secretary for the protection of various resource 
values;
    2. Right-of-way exclusion areas;
    3. Lands currently designated as VRM Classes I or II;
    4. Lands currently designated as no surface occupancy areas; and
    5. Lands designated as critical habitat for federally designated 
threatened or endangered species.
    The heading for section 2805.10 would be revised to read, ``How 
will I know if BLM has approved or denied my application, or if my bid 
for a solar or wind energy development lease inside a designated 
leasing area is successful or unsuccessful?'' This section would be 
updated to reflect the new competitive process for lands inside 
designated leasing areas by

[[Page 59040]]

providing that a successful bidder for a solar or wind development 
lease on such lands would not have to submit an SF-299 application. 
Instead, in these circumstances, the successful bidder would have the 
option to sign the lease offered by the BLM.
    Paragraph (a) of this section would contain the existing language 
that explains how the BLM would notify you about your application. It 
would add a new provision requiring that the BLM send the successful 
bidder a written response, including an unsigned lease for review and 
signature. Unsuccessful bidders would also be notified and any funds 
submitted with their bid would be returned. If an application is 
rejected, the applicant would still be required to pay any pre-
application costs (paragraph 2804.10(a)(4)), filing fees (paragraph 
2804.12(a)(8)), and any processing fee (section 2804.14).
    Proposed paragraphs 2805.10(b), (b)(1), and (b)(2) would parallel 
existing paragraphs (a)(1) and (a)(2), and the content remains 
unchanged. These paragraphs describe the unsigned grant that the BLM 
would send for approval and signature.
    Paragraph (b)(3) of this section would specify that the BLM may 
make changes to any grant or lease as a result of the periodic review 
of the grant or lease required by this section, including those issued 
under subpart 2809, in accordance with paragraph 2805.15(e). A more 
detailed discussion can be found under that section. This provision is 
necessary because many terms and conditions of leases issued under 
subpart 2809 would not be changed except as described in this rule. 
However, the terms and conditions in subpart 2809 may be changed in 
accordance with paragraph 2805.15(e) as a result of changes in 
legislation, regulation, or as otherwise necessary to protect public 
health or safety or the environment.
    Proposed paragraphs 2805.10(c), 2805.10(d), 2805.10(d)(1), 
2805.10(d)(2), and 2805.20(d)(3) would contain the language from 
existing paragraphs 2805.10(b) 2805.10(c), 2805.10(c)(1), 
2805.10(c)(2), and 2805.20(c)(3). These provisions remain unchanged 
from existing regulations.
    Existing paragraph 2805.11(b) explains how the duration of each 
potential right-of-way is determined. This paragraph would be revised 
to include specific terms for solar and wind energy authorizations 
because they are unique and different than other right-of-way 
authorizations.
    Paragraph 2805.11(b)(2)(i) would limit the term for a site specific 
grant for testing and monitoring of wind energy potential to 3 years. 
Under this rule, this type of grant would only be issued for a single 
meteorological tower or wind study facility. This authorization cannot 
be renewed. If a holder of a grant wishes to keep their site for 
additional time, they must reapply.
    Paragraph 2805.11(b)(2)(ii) would provide for an initial term of 3 
years for project area wind energy testing. Such grants may include any 
number of meteorological towers or wind study facilities inside the 
right-of-way. Any renewal application must be submitted before the end 
of the third year. In order for the BLM to renew a permit, the project 
area wind testing grant holder must submit another application for wind 
energy development and a POD for that use. Renewals for project area 
wind testing grants may be authorized for one additional 3-year term.
    Paragraph 2805.11(b)(2)(iii) would provide for a short-term grant 
for all other associated actions, such as geotechnical testing and 
other temporary land-disturbing activities, when the term is 3 years or 
less. A renewal of this grant may be issued under for an additional 3-
year term.
    Paragraph 2805.11(b)(2)(iv) would provide for an initial grant term 
of up to 30 years for solar and wind energy grants outside of 
designated leasing areas, with a possibility of renewal in accordance 
with paragraph 2805.14(g). A holder must apply for renewal before the 
end of the authorization term.
    Paragraph 2805.11(b)(2)(v) would provide for a 30-year term for 
solar and wind energy development leases inside designated leasing 
areas. A holder may apply for renewal for this term and any subsequent 
terms of the lease before the end of the authorization and the renewal 
would be considered at that time by the BLM.
    For all grants and leases under this section with terms greater 
than 3 years, the actual term period would include the number of full 
years specified, plus the initial partial year, if any. This provision 
differs from the grant term for rights-of-way authorized under the MLA 
(see the discussion of paragraph 2885.11 later in this preamble 
section) as FLPMA rights-of-way may be issued for terms greater than 30 
years, while a MLA right-of-way may be issued for a maximum term of 30 
years and a partial year would count as the first year of a grant.
    Paragraph 2805.11(b)(3) contains the language from existing 
paragraph 2805.11(b)(2) and would require that grants and leases with 
terms greater than 3 years include the number of full years specified, 
plus the partial year, if any. This proposed change to existing BLM 
regulations would affect the duration of all right-of-way grants that 
are issued or amended after the final rule becomes effective. This 
change would provide specific direction for consistently calculating 
the term of a right-of-way grant or lease.
    Section 2805.12 would provide a listing of terms and conditions to 
which all right-of-way holders must comply. This section has been 
reorganized in order to better present a large amount of information. 
Paragraph (a) of this section in the proposed rule would carry forward, 
without adjustment, most of the requirements from the existing section. 
Paragraph (b) of this section refers the reader to new section 2805.20, 
which explains bonding requirements for right-of-way holders. Paragraph 
(c) of this section contains specific terms and conditions for solar or 
wind energy right-of-way authorizations. The following discussion would 
apply only to those requirements that are proposed by this rule. All 
other requirements are part of the existing regulation and are not 
discussed in this preamble.
    New paragraph 2805.12(a)(5) contains existing language from section 
2805.12(e) with two small changes. The word ``phase'' would be changed 
to ``stage'' to prevent confusion with the use of ``phase-in of the MW 
capacity fee'' and similar phrases in this proposed rule. The proposed 
rule would also prohibit discrimination based on sexual orientation. 
Adding sexual orientation as a protected class in this regulation would 
be consistent with the policy of the Department of the Interior that no 
employee or applicant for employment be subjected to discrimination or 
harassment because of his or her sexual orientation. See 373 
Departmental Manual 7 (June 5, 2013).
    Paragraph 2805.12(a)(8)(v) would require compliance with project 
specific terms, conditions, and stipulations, including proper 
maintenance and repair of equipment during the operation of the grant. 
This is an existing policy requirement that affects all rights-of-way 
and would be clarified to include leases offered under new subpart 2809 
and that the approved operations would not unnecessarily harm the 
public land by poor maintenance and operation activities. In addition, 
this provision would require a holder to comply with the terms and 
conditions in the POD. Any holder that does not comply with the POD 
approved by the BLM would be subject to remedial actions under existing 
section 2807.17, which may include the suspension or termination of the 
grant or lease.

[[Page 59041]]

    In order to comply with the terms and conditions of the grant or 
lease, a developer may choose to modify, remove or add improvements to 
the project in order to remedy identified compliance matters. Proposed 
changes to the grant or lease, if approved by BLM, would be completed 
as discussed in section 2807.11 as a substantial deviation. Substantial 
deviations may require adjustment to a grant or lease rent and fees 
under part 43 CFR 2806, or bonding requirements under part 43 CFR 2805 
and 2809 that reflect proposed changes that are approved by BLM.
    New paragraph 2805.12(a)(15) would require that a grant holder or 
lessee provide or make available, upon the BLM's request, any pertinent 
environmental, technical, and financial records for inspection and 
review. Any information marked confidential or proprietary would be 
kept confidential to the extent allowable by law. Review of the 
requested records would facilitate the BLM's monitoring and inspection 
activities related to the development. The records would also be used 
to determine if the holder is complying with the requirements for 
holding a grant under existing paragraph 2803.10(b).
    Paragraph 2805.12(b) would require that grant holders and lessees 
comply with the bonding requirements of new section 2805.20. The 
existing bonding requirements are lacking in detail and this new 
section would help clarify the requirements of a grant holder or 
lessee.
    New paragraph 2805.12(c) would identify specific terms and 
conditions for grants and leases issued for solar or wind energy 
development, including those issued under subpart 2809, unless 
specifically noted.
    New paragraph 2805.12(c)(1) would prohibit ground-disturbing 
activities until either a notice to proceed is issued under the 
authority of existing section 2807.10 or the BLM states in writing that 
all requirements have been met to begin construction. Requirements may 
include the payment of rents, fees, or monitoring costs and securing a 
performance and reclamation bond. The BLM would apply this requirement 
prohibiting ground-disturbing activities to all solar and wind rights-
of-way due to the large-scale of most of these projects.
    Paragraph 2805.12(c)(2) would require construction to be completed 
within the timeframes provided in the approved POD. Construction must 
begin within 24 months of the effective date of the grant authorization 
or within 12 months, if approved as a staged development. Further 
discussion of a staged development can be found under section 2806.50.
    Paragraph 2805.12(c)(3) would require each stage of construction 
after the first begin within 3 years after construction began for the 
previous stage of development. Construction would be completed no later 
than 24 months after the start of construction for that stage of 
development. These time periods were selected after evaluating the 
timing of other completed wind energy development projects. These 
timeframes help to ensure that the public land is not unreasonably 
encumbered by these large authorizations, which are exclusive to other 
rights during the construction period of the project.
    Paragraph 2805.12(c)(3)(iii) would limit the number of stages of 
development to three, unless the BLM's approval for additional stages 
is obtained in advance. The BLM would generally approve up to three 
stages for solar and wind energy development. Approval of additional 
stages may be requested by an applicant or holder, but must be 
accompanied with supporting discussion for why additional stages are 
necessary or reasonable. Each stage would require a review of records 
and a decision issued by the BLM to allow the construction of the next 
stage. Additional phasing could generate unnecessary work for the BLM.
    Paragraphs (c)(4), (c)(5), and (c)(6) of this section would contain 
specific requirements for diligent development and the potential 
consequences of not complying with these requirements.
    Paragraph 2805.12(c)(4) would require the holder to maintain all 
onsite electrical generation equipment and facilities in accordance 
with the design standards of the approved POD. This paragraph specifies 
requirements to comply with the POD that must be submitted under 
paragraph 2804.10(c)(4).
    Paragraph 2805.12(c)(5) would provide requirements for repairing or 
removing damaged or abandoned equipment and facilities within 30 days 
of a notice from the BLM. The BLM would issue a notice of noncompliance 
under this provision only after identifying damaged or abandoned 
facilities that present an unnecessary hazard to the public health or 
safety or the environment for a continuous period of 3 months. Upon 
receipt of a notice of noncompliance under this provision, an operator 
would be required to take appropriate remedial action within 30 days, 
or show good cause for any delays. Failure to comply with these 
requirements may result in suspension or termination of a grant or 
lease.
    Under paragraph 2805.12(c)(6), the BLM may suspend or terminate a 
grant if the holder does not comply with the diligent development 
requirements of the authorization.
    Paragraph 2805.12(d) would describe specific requirements for wind 
energy site or project testing grants. These requirements include 
shorter time periods for beginning construction, because these grant 
terms are only 3 years or less. All facilities must be installed within 
12 months after the effective date of the grant. All equipment must be 
maintained and failure to comply with any terms may result in 
termination of the authorization.
    The BLM is proposing two new paragraphs for section 2805.14, both 
of which would address renewal applications. New paragraph (g) would 
provide that a holder of a solar or wind energy development grant or 
lease may apply for renewal under section 2807.22. New paragraph (h) 
would provide that a holder of a wind energy project area testing grant 
may apply for renewal of such a grant for up to an additional 3 years, 
provided that the renewal application also includes a wind energy 
development application. The BLM is proposing paragraph (h) to 
recognize that project area testing may be necessary for longer than an 
initial 3-year term even after an applicant believes that wind energy 
development at a proposed project site is feasible.
    Under existing paragraph 2805.15(e), the BLM may change the terms 
and conditions of a grant as a result of changes in legislation, 
regulation, or as otherwise necessary to protect public health or 
safety or the environment. This paragraph remains unchanged and would 
apply to the leases issued under subpart 2809. The BLM must maintain 
the flexibility to adjust these leases for new laws and rules, as well 
as to protect the public lands. In section 2805.15, the word 
``facilities'' would be added to the first sentence of paragraph (b) to 
clarify that the BLM may require common use of right-of-way facilities. 
The term ``facility'' is defined in the BLM's existing regulations at 
section 2801.5 and means an improvement or structure that would be 
owned and controlled by the grant holder or lessee. Common use of a 
right-of-way is when more than one entity uses the same area for their 
authorization. This revision would facilitate the cooperation and 
coordination between users of the public lands managed by the BLM so 
that resources are not unnecessarily impacted. An example of common use 
of a facility would be authorization for a roadway and an adjacent 
transmission

[[Page 59042]]

line. Maintenance of the transmission line would include use of the 
adjacent roadway. Under existing paragraph 2805.14(b), the BLM may 
authorize or require common use of a facility as a term of the grant. 
Under this existing provision, a grant holder may charge for the use of 
its facility. A reference to this paragraph is provided in the section 
proposed.
    The table of monitoring categories in section 2805.16 would no 
longer have the dollar amounts for the 2005 category fees. Paragraph 
(b) explains that the current year's monitoring cost schedule is 
available from any BLM State, district, or field office, or by writing 
and would be adjusted for inflation annually using the same methodology 
as the table in paragraph 2804.14(b). The table now only includes the 
existing definition of the monitoring categories in terms of hours 
worked, instead of providing specific dollar amounts. This change was 
made to avoid either adjusting the table each year through a rulemaking 
or relying on outdated material. The current monitoring fee schedule 
may also be found at http://www.blm.gov. This paragraph also provides 
that you may pay directly to another Federal agency their incurred 
costs in monitoring your grant instead of paying the fee to the BLM.
    New section 2805.20 would provide for the bonding requirements for 
all grant holders or lessees. This information would be moved from the 
existing section 2805.12. Bonds are required only at the BLM's 
discretion, but this expanded section explains the specifics should a 
bond be required. Specific bonding requirements for solar and wind 
energy development are also outlined in paragraphs (b) and (c) of this 
section.
    New paragraph 2805.20(a) would provide that, if required by the 
BLM, you must obtain or certify that you have obtained a performance 
and reclamation bond or other acceptable bond instrument to cover any 
losses, damages, or injury to human health or damages to property or 
the environment in connection with your use of an authorized right-of-
way. This paragraph includes the language from existing paragraph 
2805.12(g), which is the section that details bonding requirements.
    Paragraph 2805.20(a)(1) would require that bonds list the BLM as an 
additionally covered party if a State regulatory authority requires a 
bond to cover some portion of environmental liabilities. If the BLM 
were not named as an additionally covered party for such bonds, the BLM 
would not be covered by the instrument. This provision would allow the 
BLM to accept the State bond as satisfying a portion of the BLM's 
bonding requirement, thus limiting double bonding.
    Under paragraph (a)(1)(i), the State's bond must be redeemable by 
the BLM. If such instrument is provided to the BLM and it is not 
redeemable, the BLM would be unable to use the bond for its intended 
purpose(s).
    Under paragraph (a)(1)(ii), the State's bond must be held or 
approved by a State agency for the same reclamation requirements as the 
BLM requires.
    Under paragraph (a)(1)(iii), the State's bond must provide the same 
or greater financial guarantee than the BLM requires for the portion of 
environmental liabilities covered by the State's bond.
    Under paragraph 2805.20(a)(2) a bond must be approved by the BLM 
authorized officer. This approval ensures that the bond meets the BLM's 
standards. Under paragraph 2805.20(a)(3), the amount would be 
determined based on an RCE, and must also include the BLM's costs in 
administering a reclamation contract. As defined in section 2801.5, the 
RCE identifies an appropriate amount for financial guarantees for uses 
of the public lands. Both of these paragraphs contain a stipulation 
that they do not apply to leases issued under subpart 2809. Bonds 
issued under subpart 2809 for leases inside designated leasing areas 
have standard amounts. Bond acceptance and amounts for solar and wind 
energy facilities outside of designated leasing areas are discussed in 
paragraphs (b) and (c) of this section.
    Proposed paragraph 2805.20(a)(4) would require that a bond be 
submitted on or before the deadline provided by the BLM. Current 
regulations have no such provision and this revision would enable the 
BLM to collect bonds in a timely manner. Timely submittal of a bond 
would promote efficient stewardship of the public lands and ensure that 
the bond amount provided would be acceptable to the BLM and available 
prior to beginning on-the-ground activities.
    Paragraph 2805.20(a)(5) would outline the components to be 
addressed when determining a RCE. They include environmental 
liabilities, maintenance of equipment and facilities, and reclamation 
of the right-of-way. This paragraph consolidates and presents what 
liabilities the bond must cover.
    Under paragraph 2805.20(a)(6), a holder of a grant or lease may ask 
the BLM to accept a replacement bond. The BLM must review and approve 
the replacement bond before accepting it. Should a replacement bond be 
accepted, the surety company for the old bond is not released from 
obligations that accrued while the old bond was in effect unless the 
new bond covers such obligations to the BLM's satisfaction. This gives 
the grant holder flexibility to find a new bond, potentially reducing 
their costs, while ensuring that the right-of-way is adequately bonded.
    A holder of a grant or lease would be required to notify the BLM 
that reclamation has occurred under paragraph 2805.20(a)(7). If the BLM 
determines reclamation is complete, the BLM may release all or part of 
the bond that covers these liabilities. However, paragraph 
2805.20(a)(8) reiterates that a grant holder is still liable in certain 
circumstances under existing section 2807.12. Despite the bonding 
requirements of this section, grant holders are liable if the BLM 
releases all or part of your bond, the bond amount does not cover the 
cost of reclamation, or even if no bond remains in place.
    New paragraphs 2805.20(b) and 2805.20(c) would identify specific 
bond requirements for solar energy development and wind energy 
development, respectively, outside of designated leasing areas. Holders 
of a solar or wind energy grant outside of designated leasing areas 
would be required to submit an RCE to help the BLM determine the bond 
amount. The bond amount would be no less than $10,000 per acre for 
solar energy development grants and no less than $20,000 per authorized 
turbine for wind energy development grants. Bond amounts for short term 
grants for wind energy site or project testing would be no less than 
$2,000 per authorized meteorological tower. These minimum bond amounts 
for lands outside of designated leasing areas would be the standard 
bond amounts inside of designated leasing areas.
    The BLM completed a recent review of existing bonded solar and wind 
energy projects and the BLM based the bond amounts in this proposed 
rule on the information discovered during this review. When determining 
these bond amounts, the BLM considered potential liabilities associated 
with the lands affected by the rights-of-way, such as cultural values, 
wildlife habitat, and scenic values. The range of costs included in 
this review represented the cost differences in performing reclamation 
activities for solar and wind energy developments throughout the 
various geographic regions the BLM manages. The BLM used this review to 
determine an appropriate bond amount to cover potential liabilities 
associated with solar and wind energy projects.

[[Page 59043]]

    Minimum bond amounts were set for solar development for each acre 
of authorization because the activities authorized encumber 100 percent 
of the lands and are exclusive to other uses. The range of bond amounts 
for solar energy development was approximately $10,000 to $18,000 per 
acre of the rights-of-way on public lands. Minimum bond amounts for 
wind energy development were set for each wind turbine authorized on 
public land because the encumbrance is factored at 10 percent and is 
not exclusive to other uses. The review showed that the range of bond 
amounts for wind energy development varied between $22,000 and $60,000 
per wind turbine.
    The heading of section 2806.12 would be changed to ``When and where 
do I pay rent?'' New paragraph 2806.12(a) would describe the proration 
of rent for the first year of a grant. Specific dates are used for 
proration to prevent any confusion for grant holders or the BLM. Rent 
is prorated for the first partial year of a grant, since the use of 
public lands in such situations is only for a partial year. Paragraph 
(a)(2) of this section explains that if you have a short term grant, 
you may request that the BLM bill you for the entire duration of the 
grant in the first payment. Some short term grant holders may wish to 
pay this amount up front.
    New paragraph (d) of section 2806.12 would direct right-of-way 
grant holders to make rental payments as instructed by the BLM or as 
provided for by Secretarial order or legislative authority. This 
provision acknowledges that the Secretary or Congress may take action 
that could affect rents and fees. The BLM would provide payment 
instructions for grant holders, which would include where payments may 
be made.
    Section 2806.13 would be retitled ``What happens if I do not pay 
rents or fees or if I pay the rents or fees late?'' This change 
addresses the addition of new paragraph (e) that would provide 
authority for the BLM to retroactively bill for uncollected or under-
collected rents and fees. The BLM would collect rent if: (1) A clerical 
error is identified; (2) A rental schedule adjustment is not applied; 
or (3) An omission or error in complying with the terms and conditions 
of the authorized right-of-way is identified.
    Paragraph (a) of this section would be amended by removing language 
from the existing rule that a fee for a late rental payment may not 
exceed $500 per authorization. The BLM has determined that the current 
$500 limit is not a sufficient financial incentive to ensure the timely 
payment of rent. Therefore, under this proposed rule, late fees would 
be proportionate to late rental amounts. A penalty proportionate to the 
rental amount would provide more incentive for the timely payment of 
rents to the BLM. The BLM also added the term ``fees'' so the MW 
capacity fees for solar and wind energy development grants and leases 
may be retroactively collected.
    New paragraph (g) of this section would allow the BLM to condition 
any further activities associated with the right-of-way on the payment 
of outstanding payments. The BLM believes that this consequence imposed 
for outstanding payments would be further incentive to timely pay rents 
to the BLM.
    In section 2806.20, the address to obtain a current rent schedule 
for linear rights-of-way would be updated. District offices would also 
be added to State and field offices as a location at which you may 
request a rent schedule. These are minor corrections made to provide 
current information to the public.
    A technical correction in 2806.22 would correct the acronym IPD-
GDP, referring to the Implicit Price Deflator for Gross Domestic 
Product.
    Section 2806.23 would be amended by removing paragraph (b), which 
refers to the 2-year phase-in of the linear rent schedule in 2009 and 
renumbering the existing paragraphs. This language would be removed 
since the phase-in for the updated rent schedule ended in 2011 and 
thus, is no longer applicable.
    Paragraph 2806.24(c) would explain how the BLM prorates the first 
year rental amount. The proposed rule would add the option to pay rent 
for multiple year periods. The new language would require payment for 
the remaining partial year along with the first year, or multiples 
thereof, if proration applies.
    Section 2806.30 would be amended by removing the communications 
site rent schedule table. The rent schedule may be found at section 
2806.70. Paragraph (b) would be removed and paragraph (c) would be 
redesignated as new paragraph (b).
    Paragraph 2806.30(a)(1) would be revised to update the mailing 
address. Paragraphs 2806.30(a)(2) would be revised by removing 
references to the table that would be removed. This paragraph would 
still describe the methodology for updating the schedule, but would 
direct the reader to the BLM's Web site or offices instead.
    Paragraph 2806.34(b)(4) would be revised to fix a citation in the 
existing regulations that is incorrect.
    Paragraphs 2806.43(a) and 2806.44(a) would each be revised by 
changing the cross-reference from section 2806.50 to section 2806.70. 
Section 2806.50 would be redesignated as section 2806.70 and these 
citations must be updated to reflect this change.
    Sections 2806.50 and 2806.60 would provide new rules for the rents 
and fees of solar and wind energy development, respectively. The rents 
and fees described in these sections, along with the bidding process, 
would help the BLM receive fair market value for the use of the public 
lands. There are similarities between rents for solar and wind, as well 
as between rents for lands inside and outside of designated leasing 
area. These similarities are discussed below and include acreage and MW 
capacity fees, phase-ins, and adjustments. For some of these, several 
components comprise a single element of the rent and will be discussed 
here. Where there are differences in the solar rent provisions, they 
are discussed in sections 2806.52 and 2806.54, and for wind rents, they 
are discussed in sections 2860.62 and 2860.64. The differences between 
inside and outside of designated leasing areas will be identified and 
discussed in the section-by-section analysis.
    Section 2806.50 would be retitled ``Rents for solar energy rights-
of-way.'' The existing regulation at section 2806.50 would be 
redesignated as new section 2806.70. Revised section 2806.50 would 
require a holder of a solar energy right-of-way authorization to pay 
annual rent for right-of-way authorizations both inside and outside of 
a designated leasing area. Those right-of-way holders with 
authorizations located outside a designated leasing area would pay rent 
for a grant and those right-of-way holders with authorizations inside 
designated leasing areas would pay rent for a lease. Rent for both 
types of right-of-way authorizations would consist of an acreage rent 
and MW capacity fee. The acreage rent would be paid in advance, prior 
to the issuance of an authorization, and the MW capacity fee would be 
phased-in. Initial acreage rent and MW capacity fee would be 
calculated, charged, and prorated consistent with right-of-way 
requirements at sections 2806.11 and 2806.12. Rent for solar 
authorizations would vary depending on the number of acres, technology 
of the solar development, and whether the right-of-way authorization is 
a grant or lease.
    New section 2806.52 would be titled ``Rent for solar energy 
development grants.'' This section would require a grant holder to pay 
rent annually based on the acreage rent and MW capacity fee.
    New paragraph 2806.52(a), ``Acreage rent,'' would describe the per-
acre

[[Page 59044]]

county rate, acreage rent payment, and adjustments for solar grants. 
Acreage rent, as defined in section 2801.5, means rent assessed for 
solar energy development grants and leases that is determined by the 
number of acres authorized for the grant or lease times the per-acre 
county rate.
    Under new paragraph 2806.52(a)(1), the acreage rent would be 
calculated by multiplying the number of acres (rounded up to the 
nearest tenth of an acre) within the authorized area times the per-acre 
county rate in effect at the time the authorization is issued. Under 
paragraph 2806.52(a)(1), the initial per-acre county rate would be 
established at double the per-acre rent value for each respective 
county using the BLM's linear rent schedule (see paragraph 2806.20(c)). 
The per-acre county rates used for linear right-of-way grants reflect a 
50 percent encumbrance factor, while a 100 percent encumbrance factor 
is used to determine acreage rent for solar energy right-of-way 
authorizations since solar energy facilities generally encumber 100 
percent of the authorized acreage to the exclusion of other public land 
uses. Therefore, doubling the per-acre county rate for linear rights-
of-way would reflect the 100 percent encumbrance of solar energy 
development. An annual adjustment would be made to the per-acre county 
rates based upon the IPD-GDP, as determined under existing paragraph 
2806.22(a). These adjusted rates would be effective on January 1 of 
each year. A copy of the per-acre county rates for solar energy 
development would be made available by the BLM upon request.
    Acreage rent example: The 2012 acreage rent for a 4,000 acre solar 
energy development grant in Clark County, Nevada is $782,240 (4,000 
acres x $195.56 per acre) while the 2013 acreage rent would be $797,120 
(4,000 acres x $199.28 per acre) to reflect the 1.9 percent annual 
acreage rent adjustment.
    New paragraph 2806.52(a)(2) would provide that acreage rent would 
be required each year, regardless of the stage of development or status 
of operations of a grant. Acreage rent would be paid for the public 
land acreage described in the right-of-way grant prior to issuance of 
the grant and prior to the start of each subsequent year of the 
authorized term. There is no phase-in period for acreage rent, which 
must be paid initially upon issuance of the grant. A rental payment 
plan may be requested and approved by the BLM State Director consistent 
with section 2806.15(c).
    New paragraph 2806.52(a)(3) would provide that the BLM would adjust 
the per-acre county rates each year based on the average annual change 
in the IPD-GDP as determined under paragraph 2806.22(a). The acreage 
rent also would adjust each year for solar energy development grants 
outside designated leasing areas. The BLM would use the most current 
per-acre county rates to calculate the acreage rent for each year of 
the grant term. The BLM posts the current per-acre county rates for 
solar energy development grants and leases at http://www.blm.gov/wo/st/en/prog/energy/renewable_energy.html.
    New paragraph 2806.52(b), ``MW capacity fee'' would describe the 
components used to calculate the MW capacity fee. Paragraphs (b)(1), 
(b)(2), (b)(3), and (b)(4) explain the MW rate, MW rate schedule, 
adjustments to the MW rate, and the phase-in of the MW rate.
    The MW capacity fee, as defined in section 2801.5, would mean fees 
paid, in addition to the acreage rent, for solar energy development 
grants and leases based on the approved MW capacity of the solar energy 
authorization. The MW capacity fee captures the value of the increased 
industrial use of the right-of-way, above the limited rural or 
agricultural land value captured by the acreage rent schedule. The MW 
capacity fee would vary depending on the size and type of solar project 
and technology and whether the solar energy right-of-way authorization 
is a grant (if located outside a designated leasing area) or a lease 
(if located inside a designated leasing area). The MW capacity fee is 
paid annually when electricity generation begins or as approved, within 
the approved POD, whichever comes first. If the electricity generation 
does not begin on or before the time approved in the POD, the BLM will 
begin charging a MW capacity fee at the time identified in the POD.
    The POD submitted to the BLM would identify the stages of 
development for the solar or wind energy project's energy generation. 
The POD stages would describe development steps for the solar or wind 
energy facility and the time by which energy operations would begin. 
Each step of development would generally separate the project into a 
different energy development stage. The POD and its stages represent 
the agreed-to understanding between the grant holder and the BLM of 
what the status of the facility would be at any given point in time 
after lease or grant issuance. The BLM would generally allow up to 
three development stages for a solar energy project. As the facility 
becomes operational, the approved MW capacity would increase as would 
be described in the POD. These stages are part of the approved POD and 
would allow the BLM to enforce the diligence requirements associated 
with the grant.
    The ``MW capacity fee'' is the total authorized MW capacity 
approved by the BLM for the project, or an approved stage of 
development, multiplied by the appropriate MW rate. The MW capacity fee 
is prorated and would be paid for the first partial calendar year in 
which generation of electricity starts or when identified within an 
approved POD.
    New paragraph 2806.52(b)(1) would identify the ``MW rate'' as a 
formula that is the product of four components: The hours per year 
multiplied by the net capacity factor, multiplied by the MWh price, 
multiplied by the rate of return. This can be represented by the 
following equation: MW Rate = H (8,760 hrs) x N (net capacity factor) x 
MWh (Megawatt Hour price) xR (rate of return). The components of this 
formula are discussed here at greater length.
    Hours per year. This component of the MW rate formula is the fixed 
number of hours in a year (8,760). The BLM would use this number of 
hours per year for both standard and leap years.
    Net capacity factor. The net capacity factor is the average 
operational time divided by the average potential operational time of a 
solar or wind energy development, multiplied by the current technology 
efficiency rates. A net capacity factor is used to identify the 
efficiency at which a project operates. The net capacity factor is 
influenced by several common factors such as geographic location and 
topography and the technology employed. Other factors can influence the 
specifics of a project's net capacity factor. For example, placement of 
a solar panel in the direction that captures the most sun may increase 
the efficiency at which a project operates. These other factors tend to 
be specifically related to a project and its design and layout. An 
increase in the net capacity factor is most readily seen when a 
developer sites a project geographically for the energy source they are 
seeking and utilizes the best technology for harnessing the power. An 
example of this would be placing wind turbines in a steady wind speed 
location with a wind turbine designed for optimal performance at those 
wind speeds.
    The efficiency rates may vary by location for each specific 
project, but the BLM proposes to use the national average for each 
technology. Efficiency rates for solar and wind energy technology can 
be found in the market reports provided by the DOE through its Lawrence 
Berkeley National Laboratory. For solar energy see ``Utility-Scale 
Solar

[[Page 59045]]

2012'' at http://emp.lbl.gov/sites/all/files/lbnl-6408e_0.pdf, 
and for wind energy, please see ``2012 Wind Technologies Market 
Report'' at http://emp.lbl.gov/sites/all/files/lbnl-6356e.pdf. This 
proposed rule would establish the net capacity factor for each 
technology as follows:

------------------------------------------------------------------------
                                                                  Net
                                                               capacity
                       Technology type                          factor
                                                               (percent)
------------------------------------------------------------------------
Photovoltaic (PV)...........................................          20
Concentrated Photovoltaic (CPV) or Concentrated Solar Power           25
 (CSP)......................................................
CSP w/Storage Capacity of 3 Hours or More...................          30
Wind Energy.................................................          35
------------------------------------------------------------------------

    The BLM would periodically review the efficiency factors for the 
various solar and wind technologies, but would not adjust this 
component of the MW rate formula except through new rulemaking. The BLM 
is considering basing the net capacity factors for these technologies 
on an average of the annual capacity factors listed by the EIA. This 
would allow the BLM to regularly update these factors absent 
rulemaking. Please specifically comment on whether and how the BLM 
could use the EIA's data to determine the net capacity factors. The EIA 
posts an average of the capacity factors on its Web site at http://www.eia.gov/electricity/monthly/epm_table_grapher.cfm?t=epmt_6_07_b. Basing the net capacity factors for these technologies on EIA's 
posted averages would allow the BLM to adjust these factors without 
future rulemakings.
    MWh price. This component of the MW rate formula is the 5-year 
average of the annual weighted average wholesale prices per MWh for the 
major ICE trading hubs serving the 11 Western States of the continental 
United States. This wholesale price of the ICE trading hubs is the 
price paid for energy on the open market between power purchasers and 
is an indication of current pricing for the purchase of power.
    The wholesale price of electricity is tracked daily on the ICE and 
is readily accessible at https://beta.theice.com/marketdata/reports/ReportCenter.shtml. Should the ICE or its successor in interest 
discontinue tracking the wholesale price of electricity, the 5-year 
average of the annual weighted average wholesale price per MWh would be 
calculated using comparable market prices.
    Pricing may be based upon a daily high and low value, as well as an 
average value. When determining the proposed MWh price, the BLM used 
the yearly average value for each of the trading hubs that cover the 
BLM public lands in the West. The BLM then averaged the yearly hub 
values for the most recent 5-year timeframe to establish the annual 
weighted average wholesale prices per MWh, which is in turn used to 
determine the MWh price. The MWh price would be initially established 
at $45 per MWh which for the years 2008 through 2012, is rounded up to 
the nearest five dollar increment.

                                             Annual Weighted Average Wholesale Price per MWh by Trading Hub
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                         Mid-                                                                       California
                Year                   Columbia    Paloverde       Four       Mead hub    SP15-EZ CA    NP15 Hub      Oregon      West US       5-yr.
                                         hub          hub      Corners hub                  hub *                   border hub                 average
--------------------------------------------------------------------------------------------------------------------------------------------------------
2008...............................       $65.32       $72.43       $72.46       $76.15       $81.20  ...........       $74.54       $73.68  ...........
2009...............................        35.85        34.90        35.60        36.70        38.24        39.22        38.28        36.97  ...........
2010...............................        35.88        38.84        40.13        40.16        40.41        40.29        38.87        39.23  ...........
2011...............................        29.42        36.31        36.66        37.02        36.39        36.29        32.86        34.99  ...........
2012...............................        22.78        29.65        30.59        30.97        35.41        32.74        26.96        29.87        42.95
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Rate of return. The rate of return component used in the MW rate 
schedule reflects the relationship of income (to the property owner) to 
revenue generated from authorized solar or wind energy development 
facilities on the encumbered property. A rate of return for the 
developed land can vary from 7 percent to 12 percent and is typically 
around 10 percent, as is identified in the market study completed by 
the Office of Valuation Services. These rates take into account certain 
risk considerations, i.e., the possibility of not receiving or losing 
future income benefits, and do not normally include an allowance for 
inflation.
    A holder seeking a right-of-way from the BLM must show that it is 
financially able to construct and operate the facility. In addition, 
the BLM may require surety or performance bonds from the holder to 
facilitate a right-of-way's compliance with the terms and conditions of 
the authorization, including any rental obligations. This reduces the 
risk and should allow the BLM to utilize a ``safe rate,'' i.e., the 
prevailing rate on guaranteed government securities that include an 
allowance for inflation. Therefore, the BLM proposes to establish a 
rate of return that adjusts every 5 years to reflect the preceding 10-
year average of the 20-year U.S. Treasury bond yield, rounded up to the 
nearest one-half percent, with a minimum rate of 4 percent. Applying 
this criterion, the initial rate of return is 4.5 percent (the 10-year 
average of the 20-year U.S. Treasury bond yield (4.3 percent), rounded 
up to the nearest one-half percent). As provided under paragraph (b)(2) 
of this section, the MW rate schedule is made available to the public 
in the MW Rate Schedule for Solar and Wind Energy Development. The MW 
rate schedule is available to the public at any BLM office, via mail by 
request, or at http://www.blm.gov/wo/st/en/prog/energy/renewable_energy.html.

                             MW Rate Schedule for Solar and Wind Energy Development
                                                   [2014-2018]
----------------------------------------------------------------------------------------------------------------
                                                   Net capacity                                   MW Rate 2014--
    Type of energy technology     Hours per year      factor         MWh Price    Rate of return       2018
----------------------------------------------------------------------------------------------------------------
Solar--Photovoltaic (PV)........           8,760            0.20             $45           0.045          $3,548
Solar--Concentrated photovoltaic           8,760            0.25              45           0.045           4,435
 (CPV) and concentrated solar
 power with less than 3 hours of
 storage capacity (CSP).........

[[Page 59046]]

 
Solar--Concentrated solar power            8,760            0.30              45           0.045           5,322
 with storage capacity of 3
 hours or more (CSP w/storage)..
Wind--All technologies..........           8,760            0.35              45           0.045           6,209
----------------------------------------------------------------------------------------------------------------

    Periodic adjustments in the MW rate are discussed under paragraph 
2806.52(b)(3). Under this rule, adjustments to the MW rate would occur 
every 5 years by recalculating the MWh price as provided in paragraph 
2806.52(b)(3)(i) and by recalculating the rate of return as provided in 
paragraph 2806.52(b)(3)(ii). The MWh price and the rate of return would 
be recalculated for the next 5-year period starting in 2020.
    In paragraph 2806.52(b)(3)(i), the MWh price would be initially at 
$45 per MWh for calendar years 2014 through 2018. However, the MWh 
price of electricity would be recalculated every 5 years beginning in 
2018, by determining the 5-year average of the annual weighted average 
wholesale price per MWh for the major ICE trading hubs serving the 11 
Western States of the continental United States for the years 2013 
through 2017, rounded to the nearest five-dollar increment. The 
resulting MWh price would be used to determine the MW rate for each 
subsequent 5-year interval. The availability of data on which the MWh 
price would be based is discussed in this preamble in the discussion of 
section 2801.5.
    In paragraph 2806.52(b)(3)(ii), the rate of return is initially 
established at 4.5 percent, which is the 10-year average (2003 through 
2012) of the 20-year U.S. Treasury bond yield (4.3 percent), rounded up 
to the nearest one-half percent (4.5 percent). The rate of 4.5 percent 
would be used for calendar years 2014 through 2018. However, the rate 
of return would be recalculated every 5 years beginning in 2018, by 
determining the 10-year average of the 20-year U.S. Treasury bond yield 
for calendar years 2008 through 2017, rounded up to the nearest one-
half percent. The resultant rate of return, of not less than four 
percent, would be used to determine the MW rate for calendar years 2019 
through 2023, and so forth. The 20-year U.S. Treasury bond yields are 
tracked daily and are readily accessible at http://www.treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=longtermrateAll.
    To allow for a reasonable and diligent testing and operational 
period, under paragraph 2806.52(b)(4)(i), the BLM would provide for a 
3-year phase-in of the MW capacity fee. This would apply after the 
start of generation operations for solar energy development grants 
outside designated leasing areas, at the rates of 25 percent for the 
first year, 50 percent the second year, and 100 percent the third and 
subsequent years of operations. The first year is the first partial 
calendar year of operations and the second year is the first full year. 
For example, if a facility begins producing electricity in June 2014, 
25 percent of the capacity fee would be assessed for June through 
December of 2014 and 50 percent of the capacity fee would be assessed 
for January through December of 2015. One hundred percent would be 
assessed thereafter.
    Under paragraph 2806.52(b)(4)(ii), the proposed rule further 
explains the staged development of a right-of-way. Such staged 
development, consistent with the proposed rule in paragraph 
2805.12(c)(3)(iii), would have no more than three development stages, 
unless the BLM approves more development stages in advance. The 3-year 
phase-in of the MW rate applies individually to each stage of the solar 
development. The MW capacity fee is calculated using the authorized MW 
capacity approved for that stage multiplied by the MW rate for that 
year of the phase-in, plus any previously approved stages multiplied by 
the MW rate.
    New section 2806.54 would be titled ``Rents and fees for solar 
energy development leases inside designated leasing areas.'' The 
introductory paragraph to section 2806.54 requires a holder of a solar 
energy lease obtained through the competitive process under subpart 
2809 to pay an annual acreage rent and MW capacity fee. The acreage 
rent would be paid in advance, prior to issuing a lease, and the MW 
capacity fee would be phased-in and calculated upon the total 
authorized MW capacity of the solar energy development. Rent or fees 
for solar authorizations would vary depending on the number of acres, 
technology of the solar development, and whether the right-of-way 
authorization is a grant or lease.
    There are many similarities in the rent for leases and grants for 
solar development. This section would reference the rent of grants 
outside of designated leasing areas as appropriate and provide further 
discussion where the rent for a lease differs from that of a grant.
    Paragraph (a) of this section identifies the acreage rent for a 
solar lease, which would be calculated in the same way as acreage rent 
for solar grants outside a designated leasing area (see paragraph 
2806.52(a)). The acreage rent amount for a lease would be calculated 
and paid prior to issuing a lease. County rates and payment of the 
acreage rent are the same for leases as they are for grants. For the 
per-acre county rates, see paragraph 2806.52(a)(1). For the acreage 
rent payment, see paragraph 2806.52(a)(2).
    New paragraph 2806.54(a)(3) describes the adjustments to the 
acreage rent that would be made for a lease. Once the acreage rent is 
determined for a lease under paragraph (a) of this section, no further 
adjustments in the annual acreage rent would be made for 10 years and 
each subsequent 10-year period after that. The first acreage rent 
adjustment would not be made until year 11 of the lease term, and the 
next adjustment would not be made until year 21 of the lease term, 
ending on year 30 of the lease. During the 10-year periods, the acreage 
rent would remain constant and not be adjusted. The BLM would adjust 
the per-acre county rates each year based on the average annual change 
in the IPD-GDP, as determined under paragraph 2806.22(a). Due to the 
IPD-GDP adjustment, the per-acre county acreage rent also adjusts each 
year. The BLM would use the most current per-acre county rates to 
calculate the acreage rent for the next 10-year period of the lease.
    Paragraph (b) of this section would identify the MW capacity fee 
for solar development leases, which is to be calculated in the same way 
as the MW capacity fee for solar grants outside a designated leasing 
area. The phase-in of the MW capacity fee is different from grants and 
is described below. For the MW rate, see paragraph 2806.52(b)(1). For 
the MW rate schedule, see paragraph 2806.52(b)(2). For periodic

[[Page 59047]]

adjustments in the MW rate, see paragraph 2806.52(b)(3).
    New paragraph 2806.54(c) would describe the MW rate phase-in for 
solar energy development leases. The MW rate in effect at the time the 
lease is issued will be used for the first 20 years of the lease. The 
MW rate in effect in year 21 of the lease will be used for years 21-30 
of the lease.
    Paragraph (c)(1) would provide for a 10-year phase-in of the MW 
capacity fee, plus the initial partial year, if any. The MW capacity 
fee would be calculated by multiplying the authorized MW capacity by 50 
percent of the MW rate for the applicable type of solar technology 
employed by the project. The MW rate schedule is provided for under 
paragraph 2806.52(b)(2). The phase-in proposed for solar leases 
identified would be applied to the MW rate for either solar or wind 
energy leases (see paragraph 2806.64(c)).
    New paragraph 2806.54(c)(2) would apply to the MW rate phase-in for 
years 11 through 20 of the lease. The MW capacity fee for years 11 
through 20 would be calculated by multiplying the MW capacity by 100 
percent of the MW rate.
    New paragraph 2806.54(c)(3) would apply to the MW rate for years 21 
through 30 of the lease. The MW capacity fee for years 21 through 30 
would be calculated by multiplying the MW capacity by 100 percent of 
the MW rate.
    If the POD identifies that electricity generation would begin after 
year 10 of the lease, the MW capacity fee would be calculated under 
paragraph 2806.54(c)(2) or 2806.54(c)(3), as appropriate.
    New paragraph 2806.54(c)(4) would describe the MW capacity fee of 
the lease if it were to be renewed. The MW capacity fee would be 
calculated using the current MW rates at the beginning of the new lease 
period and remain at that rate through the initial 10-year period of 
the renewal term. The MW capacity fee would be adjusted using the 
current MW rate at the beginning of each subsequent 10-year period of 
the renewed lease term.
    Under paragraph 2806.54(c)(5), the proposed rule provides for 
staged development of leases. Such staged development, consistent with 
proposed paragraph 2805.12(c)(3)(iii), would have no more than three 
development stages unless the BLM approved more development stages in 
advance. The MW capacity fee would be calculated using the authorized 
MW capacity approved for that stage multiplied by the MW rate for that 
year of the phase-in, plus any previously approved stages multiplied by 
the MW rate as described in paragraph 2806.54(c).
    MW capacity fee-example 1: The MW capacity fee for a 400-MW 
photovoltaic solar energy right-of-way grant would be $1,419,200 per 
year (400 MW x $3,548 per MW), implemented over a 3-year period after 
the start of electricity generation. In the first partial year after 
start of generation in July for a solar energy right-of-way, the MW 
capacity fee would be $177,400 (400 MW x $3,548 per MW x 25 percent x 
0.5 year); in the second year after the start of electricity 
generation, the MW capacity fee would be $709,600 (400 MW x $3,548 per 
MW x 50 percent x 1.0 year); and in the third year after the start of 
electricity generation, and each year thereafter, the MW capacity fee 
would be $1,419,200 per year (400 MW x $3,548 per MW x 1 year).
    MW capacity fee-example 2: The MW capacity fee for a 400 MW 
concentrated PV or concentrated solar power right-of-way grant with 
less than 3 hours of storage capacity would be $1,774,000 per year (400 
MW x $4,435 per MW), implemented over a 3-year period after the start 
of electricity generation. In the first partial year assuming the start 
of electricity generation in January for a solar energy right-of-way, 
the MW capacity fee would be $443,500 (400 MW x $4,435 per MW x 25 
percent x 1 year); in the second year after the start of electricity 
generation, the MW capacity fee would be $887,000 (400 MW x $4,435 per 
MW x 50 percent x 1 year); and in the third year after start of 
generation and each year thereafter, the MW capacity fee would be 
$1,774,000 per year (400 MW x $4,435 per MW x 1 year).
    MW capacity fee--example 3: The MW capacity fee for a 400 MW 
concentrated solar power right-of-way grant with a storage capacity of 
3 hours or more would be $2,128,800 per year (400 MW x $5,322 per MW), 
implemented over a 3-year period after the start of electricity 
generation. Assuming generation began in January, in the first partial 
year after the start of electricity generation, the MW capacity fee 
would be $532,200 for a solar energy right-of-way (400 MW x $5,322 per 
MW x 25 percent x 1 year); in the second year after the start of 
electricity generation, the MW capacity fee would be $1,064,400 (400 MW 
x $5,322 per MW x 50 percent x 1 year); and in the third year after the 
start of electricity generation, and each year thereafter, the MW 
capacity fee would be $2,128,800 per year (400 MW x $5,322 per MW x 1 
year).
    Acreage rent and MW capacity fee example for a solar energy 
development grant: The annual acreage rent and MW capacity fee for 2014 
for a 400 MW photovoltaic solar energy development grant located on 
4,000 acres in Clark County, NV after the phase-in period would be 
$2,231,480. (The acreage rent of $812,280 (4,000 acres x $203.07 per 
acre) plus the MW capacity fee of $1,419,200 (400 MW x $3,548 per MW) 
equals $2,231,480).
    New section 2806.56 would be titled ``Rent for support facilities 
authorized under separate grant(s).'' Under this section, support 
facilities for solar development would be authorized under a grant. 
Support facilities could include administration buildings, groundwater 
wells, and construction laydown and staging areas. Rent for support 
facilities authorized under separate grants would be determined using 
the Per Acre Rent Schedule for linear facilities under existing 
paragraph 2806.20(c).
    New section 2806.60 would be titled ``Rents and fees for wind 
energy rights-of-way.'' Section 2806.60 would require a holder of a 
wind energy right-of-way authorization to pay annual rent for right-of-
way authorizations both inside and outside of a designated leasing 
area. Holders of right-of-way authorizations that are located outside 
of a designated leasing area would pay rent for a grant and holders of 
right-of-way authorizations that are inside designated leasing areas 
would pay rent for a lease. Rent for both right-of-way authorizations 
are the same as that for solar energy rights-of-way under section 
2806.50 and would consist of an acreage rent and MW capacity fee.
    As noted earlier in this preamble, there are similarities between 
rents and fees for solar and wind, as well as between rents and fees 
for lands inside and outside of designated leasing areas. The BLM 
intentionally designed the rents and fees for solar and wind to match 
as closely as possible in order to reduce the potential for confusion 
and misunderstanding of the requirements. The methodology for 
calculating rents, fees, phase-ins, adjustments, and rate proration are 
the same for wind as for solar. Many of the terms and conditions of a 
lease issued under this subpart would also be the same.
    Many wind energy rent and fee provisions have identical parallels 
in the solar energy rent and fee provisions. This analysis will 
reference the solar energy rent and fee discussion when appropriate and 
highlight the differences between the regulations for wind and solar 
rents and fees.

[[Page 59048]]

    New section 2806.62 parallels proposed section 2806.52, which 
discusses rents and fees for solar energy development grants. The 
discussion on all components of the wind energy development grant 
duplicate the provisions for solar rents and fees, except for paragraph 
(a)(1) which discusses the per-acre county rates.
    Paragraph 2806.62(a) would address the acreage rent for wind energy 
development. See paragraph 2806.52(a) for a discussion of acreage rent.
    New paragraph 2806.62(a)(1) addresses per-acre county rates for 
wind energy development grants. The methodology for calculating the 
acreage rent is the same for wind as it is for solar, but wind and 
solar energy have different encumbrance factors. Solar energy projects 
encumber 100 percent of the land, while wind energy projects generally 
only encumber 10 percent of the land. The per-acre county rate is 
calculated using the BLM's linear rent schedule, which is based on a 
50-percent encumbrance factor. While the per-acre county rate for solar 
would be 200 percent of the linear rent schedule (to represent 100 
percent encumbrance), the per-acre county rate for wind energy would be 
20 percent of the linear rent schedule (to represent 10 percent 
encumbrance).
    The following chart lists the paragraphs where the wind energy 
provision parallels the solar energy provision for the same topic. The 
discussion for each relevant wind energy provision can be found in the 
preamble under the associated solar energy provision.

----------------------------------------------------------------------------------------------------------------
                 Topic                              Wind                                Solar
----------------------------------------------------------------------------------------------------------------
Acreage Rent Payments..................  43 CFR 2806.62(a)(2)......  43 CFR 2806.52(a)(2).
Acreage Rent Adjustments...............  43 CFR 2806.62(a)(3)......  43 CFR 2806.52(a)(3).
MW Capacity Fee........................  43 CFR 2806.62(b).........  43 CFR 2806.52(b).
MW Rate................................  43 CFR 2806.62(b)(1)......  43 CFR 2806.52(b)(1).
MW Rate Schedule.......................  43 CFR 2806.62(b)(2)......  43 CFR 2806.52(b)(2).
MW Rate Adjustments....................  43 CFR 2806.62(b)(3)......  43 CFR 2806.52(b)(3).
MW Rate Formula........................  43 CFR 2806.62(b)(3)(i)...  43 CFR 2806.52(b)(3)(i).
Rate of Return.........................  43 CFR 2806.62(b(3)(ii)...  43 CFR 2806.52(b)(3)(ii).
MW Rate Phase-in.......................  43 CFR 2806.62(b)(4)......  43 CFR 2806.52(b)(4).
----------------------------------------------------------------------------------------------------------------

    Paragraph 2806.62(b)(4)(i) would address the term of the MW rate 
phase-in. Paragraphs (A), (B) and (C) of this section address the 
percentages of the phase-in. See paragraph 2806.52(b)(4)(i) for a 
discussion of the term of the MW rate phase-in and its paragraphs (A), 
(B) and (C) for the percentages of the phase-in.
    Paragraph 2806.62(b)(4)(ii) would address the MW rate phase-in for 
a staged development. Paragraph (A) of this section addresses the 
percentages of the phase-in and paragraph (B) addresses the calculation 
of the rent for the phase-in of a staged development. See paragraph 
2806.52(b)(4)(ii) for a discussion of the MW rate phase-in for a staged 
development, its paragraph (A) for the percentages of the phase-in, and 
its paragraph (B) for the calculation of the rent for the phase-in of a 
staged development.
    New section 2806.64 would be titled ``Rent for wind energy 
development leases inside designated leasing areas.'' See section 
2806.54 for a discussion of all components of rent for a wind energy 
development grant, except for paragraph (a)(1), which discusses the 
per-acre county rates, which do not apply to wind energy development 
grants and leases. Paragraph 2806.64(a) addresses the acreage rent for 
wind energy leases. See paragraph 2806.54(a) for a discussion of 
acreage rent.
    New paragraph 2806.64(a)(1) would address per-acre county rates for 
wind energy leases. See paragraph 2806.62(a)(1) for a discussion of 
acreage rent, which differs from solar energy development. The per-acre 
rents would be calculated using the methodology discussed in paragraph 
2806.62(a)(1), which reflects the 10 percent encumbrance factor of wind 
energy development.
    The following chart lists the paragraphs where the wind energy 
provision parallels the solar energy provision for the same topic. The 
discussion for each relevant wind energy provision can be found in the 
preamble under the associated solar energy provision.

----------------------------------------------------------------------------------------------------------------
                 Topic                              Wind                                Solar
----------------------------------------------------------------------------------------------------------------
Acreage Rent Payments..................  43 CFR 2806.64(a)(2)......  43 CFR 2806.54(a)(2).
Acreage Rent Adjustments...............  43 CFR 2806.64(a)(3)......  43 CFR 2806.54(a)(3).
MW Capacity Fee........................  43 CFR 2806.64(b).........  43 CFR 2806.54(b).
MW Rate................................  43 CFR 2806.64(b)(1)......  43 CFR 2806.52(b)(1).
MW Rate Schedule.......................  43 CFR 2806.64(b)(2)......  43 CFR 2806.52(b)(2).
MW Rate Adjustments....................  43 CFR 2806.64(b)(3)......  43 CFR 2806.52(b)(3).
MW Rate Phase-in.......................  43 CFR 2806.64(c).........  43 CFR 2806.54(c).
Years 1-10.............................  43 CFR 2806.64(c)(1)......  43 CFR 2806.54(c)(1).
Years 11-20............................  43 CFR 2806.64(c)(2)......  43 CFR 2806.54(c)(2).
Years 21-30............................  43 CFR 2806.64(c)(3)......  43 CFR 2806.54(c)(3).
MW Capacity Fee if Renewed.............  43 CFR 2806.64(c)(4)......  43 CFR 2806.54(c)(4).
MW Capacity for a Staged Development...  43 CFR 2806.64(c)(5)......  43 CFR 2806.54(c)(5).
Rent for Support Facilities............  43 CFR 2806.66............  43 CFR 2806.56.
----------------------------------------------------------------------------------------------------------------

    New paragraph 2806.68(a) would describe the rent for a wind energy 
site-specific testing grant. A minimum rent would be established as 
$100 per year for each grant issued. Under this section, rent is set by 
carrying forward the site-specific rent amount from existing IM 2009-
043, Wind Energy Development Policy, established by the BLM and 
described further as follows. Site specific grants are only authorized 
for one site and would not allow

[[Page 59049]]

multiple sites to be authorized under a single grant; however, a single 
entity may hold more than one grant. If a BLM office has an approved 
small site rental schedule, that office may use the rent amount 
established in the small site rental schedule, if the rent in the 
schedule charges more than the $100 minimum rent per year. Small site 
rental schedules are provided to the BLM from the Office of Valuation 
Services and are an appraised valuation of the land. Such schedules are 
a determination of market value. In lieu of annual payments for a site 
specific wind testing grant, a grant holder may pay for the entire 3-
year term of the grant. See paragraphs 2801.9(d)(1) and 
2805.11(b)(2)(i) for further discussion of site-specific wind energy 
testing grants.
    New paragraph 2806.68(b) would describe the rent for a wind energy 
project area testing grant. A per-year minimum rent would be 
established at $2,000 per authorization or $2 per acre for the lands 
authorized by the grant, whichever is greater. Existing rent for wind 
energy project area testing grants is at a lower rate than proposed in 
this rule. The appraisal consultation report by the Office of Valuation 
Services supports the rent established as proposed. Project area grants 
may authorize multiple meteorological or instrumentation testing sites. 
There is no additional charge or rent for the number of sites 
authorized under such grants. See paragraphs 2801.9(d)(2) and 
2805.11(b)(2)(ii) for further discussion of project area wind energy 
testing grants.
    New section 2806.70 would be a revision of existing section 2806.50 
and would be retitled ``How will BLM determine the rent for a grant or 
lease when the rent schedules do not apply?'' This section would 
provide guidance on how the BLM would determine the rent for a grant or 
lease when the linear rent schedule, the communication use rent 
schedule, the solar rental provisions, or the wind rental provisions 
are not applicable. The only change to this redesignated paragraph is 
that solar and wind energy rights-of-way are included in the listed 
rent schedules.
    Section 2807.11 would be updated to clarify requirements for 
changing a right-of-way grant. Under the proposed changes to paragraph 
2807.11(b), substantial deviations would require an amendment to a 
right-of-way grant. Substantial deviations include changing the 
boundaries of the right-of-way, major improvements not previously 
approved by the BLM, or a change in use for the right-of-way. 
Substantial deviations to a grant may require adjustment to a grant or 
lease rent and fees under part 43 CFR 2806, or bonding requirements 
under part 43 CFR 2805 and 2809 that reflect proposed changes that are 
approved by BLM.
    New paragraph (d) of this section would require you to contact the 
BLM when site-specific circumstances or conditions arise resulting in 
the need for changes to an approved right-of-way grant, POD, site plan, 
or other procedures that are not substantial deviations in location or 
use. Examples of minor deviations would be slight changes in location 
of improvements in the POD or design of facilities that are all within 
the existing boundaries of an approved right-of-way. Other such 
nonsubstantial deviations may include the modification of mitigation 
measures or project materials. Project materials would include the POD, 
site plan, and other documents that are created or provided by a grant 
holder. These project materials are a basis for the BLM's inspection 
and monitoring activities and are often appended to a right-of-way 
grant. The requested changes would be considered as grant or lease 
modification requests. Each nonsubstantial deviation would require 
review and approval by the authorized officer. New paragraph (e) would 
require right-of-way holders to contact the BLM to correct 
discrepancies or inconsistencies.
    New paragraph 2807.17(d) would consist of the provisions from 
existing section 2809.10. This language would be moved to section 
2807.17 in order to make room for the renewable energy right-of-way 
leasing provisions.
    The title of existing section 2807.21 would be changed to ``May I 
assign or make other changes to my grant or lease?'' The existing 
regulations should, but do not, cover all instances where an assignment 
is necessary and the section also needs to be revised to address 
situations in which assignments are not required. The proposed changes 
are necessary to: (1) Add and describe additional changes to a grant 
other than assignments; (2) Clarify what changes would require an 
assignment; and (3) Specify that right-of-way leases issued under part 
2809 are subject to the regulations in this section. Without the BLM's 
approval of a right-of-way grant assignment, a private party's business 
transaction would not be recognized and this lack of recognition could 
hinder a new holder's management and administration of a right-of-way 
grant. This rule would clarify the responsibilities of a grant holder 
should such private party transactions occur.
    The proposed rule would add to paragraph (a) two events that may 
necessitate an assignment: (1) A voluntary transfer by the holder of 
any right or interest in the right-of-way grant to a third party (e.g., 
a change in ownership); and (2) A change in control involving the 
right-of-way grant holder such as a corporate merger or acquisition.
    New paragraph (b) would clarify that a change in the holder's name 
only does not require an assignment and new paragraph (c) would clarify 
that changes in a holder's articles of incorporation do not require an 
assignment. As a result, the potential costs of an assignment would not 
be involved with a name change or the change in the articles of 
incorporation.
    Existing paragraph (b) would be revised and redesignated as new 
paragraph (d). As revised, this provision would require a potential 
assignee to pay application fees in addition to processing fees. This 
revision would establish consistency between applications for 
assignments and other applications for rights-of-way. For example, this 
proposed rule (at section 2804.12(a)(8)) would require a nonrefundable 
application filing fee for solar and wind energy applications. As 
revised, paragraph (d) would also provide that the BLM will not approve 
any assignment until the assignor makes any outstanding payments that 
are due.
    Existing paragraph (c) would be redesignated, unchanged, as 
paragraph (e). Existing paragraph (d) would be revised and redesignated 
as paragraph (f). As amended, paragraph (f) would except leases issued 
under revised 43 CFR subpart 2809 (i.e., inside a designated leasing 
area) from the BLM's authority to modify terms and conditions when it 
recognizes an assignment. This provision would provide incentives for 
potential right-of-way holders to develop lands inside designated 
leasing areas.
    New paragraph 2807.21(g) would provide that the BLM would process 
assignment applications according to the same time and conditions as in 
existing paragraph 2804.25(c). This provision would apply the BLM's 
existing customer service standard to processing assignment 
applications.
    New paragraph 2807.21(h) would clarify that only interests in 
right-of-way grants or leases are assignable. Pending right-of-way 
applications do not create a property right and thus may not be 
assigned.
    New paragraph (i) would address how a holder would inform the BLM 
of a name change when the name change is not the result of an 
underlying change in control of a grant. These procedures are necessary 
to ensure that the BLM will be able to send rent bills or other

[[Page 59050]]

correspondence to the appropriate party. This new provision would 
address several specific circumstances. For example, it would require 
any corporation requesting a name change to supply: (1) A copy of the 
corporate resolution(s) proposing and approving the name change; (2) A 
copy of the acceptance of the change in name by the State or Territory 
in which incorporated; and (3) A copy of the appropriate resolution(s), 
order(s), or other documentation showing the name change. Under this 
provision, the BLM could also modify a grant, or add bonding and other 
requirements, including additional terms and conditions when 
recognizing such changes. However, the only way that the BLM may modify 
a lease issued under subpart 2809 would be in accordance with paragraph 
2805.15(e). Such modifications would be a result of changes in 
legislation, regulation, or to protect public health, safety, or the 
environment. Any such name change would be recognized in writing by the 
BLM.
    The title for section 2807.22 would be revised to read ``How do I 
renew my grant or lease?'' This title would be changed so that the 
leases issued in subpart 2809 would be covered by this section. 
Paragraphs (a), (b), and (d) of this section would also be revised to 
include leases. Paragraphs (c) and (e) remain unchanged.
    Under new paragraph (f), if a holder makes timely and sufficient 
application for renewal, the existing grant or lease does not expire 
until the BLM acts upon the application for renewal. This provision 
would protect the interests of existing holders of rights-of-way who 
have timely and sufficiently made an application for the continued use 
of an existing authorization (see 5 U.S.C. 558(c)(1)), and is 
consistent with existing policy. In this situation, the authorized 
activity does not expire until the BLM evaluates the application and 
issues a decision.
    Existing subpart 2809, which consists of a single regulation 
(section 2890.10) pertaining to Federal agency right-of-way grants, 
would be revised and redesignated as new paragraph (d) of section 
2807.17. Existing paragraph 2809.10(b) explains that Federal agencies 
are generally not required to pay rent for a grant. This paragraph 
would be removed instead of redesignated, since existing paragraph 
2806.14(a)(2) already addresses rental exemptions for Federal agencies 
and it would no longer be necessary. New subpart 2809 would be 
dedicated to the competitive process for leasing public lands for solar 
and wind energy development.
    Under new section 2809.10, only lands inside designated leasing 
areas would be available for solar and wind competitive leasing using 
the procedures under this subpart. Lands outside of designated leasing 
areas may be offered competitively using the procedures under section 
2804.35 of this proposed rule. Under new section 2809.10, the BLM may 
include lands in a competitive offer on its own initiative or solicit 
nominations through a call for nominations (see proposed paragraph 
2809.11(b)). You would be required to demonstrate that you are 
qualified to hold a right-of-way grant by meeting the qualifications 
under section 2803.10. Note, the term ``grant'' is used when 
referencing section 2803.10 above and in paragraph 2809.11(c). This is 
because throughout this part, including section 2803.10, the term grant 
includes all right-of-way authorizations, including leases.
    New section 2809.11, ``How will BLM solicit nominations?'' would 
explain the process by which the BLM would request nominations for 
parcels of lands inside designated leasing areas to be offered 
competitively for solar or wind energy development.
    Under paragraph 2809.11(a), ``Call for nominations,'' the BLM would 
solicit expressions of interest and nominations for parcels of land 
located in a designated leasing area(s). The BLM would publish a notice 
in a newspaper of general circulation in the area affected by the 
potential offer of public land for solar and wind energy development, 
use other notification methods, including the Internet, and publish a 
notice in the Federal Register.
    Paragraph 2809.11(b)(1) would require a payment of $5 per acre for 
the parcel(s) nominated. This payment is nonrefundable, except when 
paragraph 2809.11(d) is applicable. The average area of solar and wind 
grant or lease ranges between 4,000 and 6,000 acres. The $5 per-acre 
fee is derived from an appraisal consultation report prepared by the 
Department's Office of Valuation Services and would be adjusted for 
inflation once every 10 years, using the IPD-GDP. The appraisal 
consultation report provided a range of $10--$27 per acre per year with 
the nominal range being $15--$17 per acre as the fair market value for 
these uses of the public lands. The BLM is establishing the nomination 
fee below the indicated range in the analysis since the submission of a 
nomination does not ensure that the nominator would be the successful 
bidder.
    The average change in the IPD-GDP from 1994 to 2003 is 1.9 percent, 
which would be applied through 2015. The fee would be required only at 
nomination and not on a yearly basis and this is noted under paragraph 
2804.12(a)(8). The nomination fee is low to increase interest in the 
leasing area and encourage nominators to propose efficient use of the 
public lands. Payment of fair market value would be received through a 
combination of the bids (not including Federal administrative costs) 
received during a competitive process and the rents and MW capacity 
fees described in sections 2806.50 through 2806.68 of this proposed 
rule.
    The submission of a nomination fee may result in a variable offset 
for an entity if it is determined to be the successful bidder in 
accordance with section 2809.15. An expression of interest is an 
informal submission to the BLM, suggesting that a parcel inside a 
competitive leasing area be considered for a competitive offer (see 
paragraph 2809.11(c)). An expression of interest only provides a 
tentative bidder's interest in a parcel(s) of land located inside a 
designated leasing area. If the expression of interest identifies a 
specific parcel, it must be submitted in writing, include the legal 
land description of the parcel, and a rationale for its inclusion in a 
competitive offer. There is no fee required to make an expression of 
interest, but submission would not qualify a potential bidder for a 
variable offset, as would formal nominations.
    Under paragraph 2809.11(d), a nomination would not be able to be 
withdrawn, except by the BLM for cause, in which case all nomination 
monies would be refunded. This clause parallels language in the BLM's 
other competitive process regulations and encourages more serious 
nominations for parcels of public land.
    New section 2809.12, ``How will BLM select and prepare parcels?,'' 
would provide that the BLM would identify parcels suitable for leasing 
based on nominations and expressions of interest, on its own 
initiative, or both. Before offering the selected lands competitively, 
the BLM and other appropriate entities would conduct necessary studies, 
comply with NEPA and other appropriate laws, and complete other 
necessary site preparation work. This work is necessary to ensure that 
the parcels are ready for competitive leasing, to provide appropriate 
terms and conditions for any issued lease, to appropriately protect 
valuable resources, and to be

[[Page 59051]]

consistent with the BLM's plans for the area.
    Under new section 2809.13, ``How will BLM conduct competitive 
offers?,'' the BLM may use any type of competitive process or procedure 
to conduct its competitive offer. Several options, such as oral 
auctions, sealed bidding, combination, oral/sealed bidding, and others 
are identified in paragraph 2809.13(a). Oral auctions are planned 
events where bidders are asked to vocally bid for a lease at a 
predetermined time and location. Sealed bidding would occur when 
bidders are asked to submit bids in writing by a certain date and time. 
Combination bidding would be when sealed bids are first opened and then 
an oral auction would occur, with oral bids having to exceed the 
highest sealed bid.
    Under paragraph (b) of this section, the BLM would publish a notice 
of the competitive offer in a newspaper of general circulation in the 
area affected by the potential right-of-way at least 30 days before 
bidding takes place. A similar notification would be published in the 
Federal Register and through other notification methods, including the 
Internet. If you nominated lands and paid the nomination fees required 
by paragraph 2809.11(b)(1), the BLM would notify you of its decision to 
conduct a competitive offer at least 30 days in advance of the bidding.
    A notice of competitive offer would include:
    1. The date, time, and location (if any) of the competitive offer;
    2. The legal land description of the parcel(s) to be offered. This 
would also include the total acreage of the parcel(s);
    3. The bidding methodology and procedures that would be used in 
conducting the competitive offer, including any of the applicable 
competitive procedures identified in paragraph 2809.13(a);
    4. The required minimum bid (see paragraph 2809.14(a));
    5. The qualification requirements for potential bidders (see 
section 2809.10);
    6. If applicable, the variable offset (see section 2809.16), 
including:
    a. The percent of each offset;
    b. How bidders may pre-qualify for each offset; and
    c. The documentation required to pre-qualify for each offset; and
    7. The terms and conditions to be contained in the lease, including 
requirements for the successful bidder to submit a plan of development 
for the lands involved in the competitive offer (see section 2809.18) 
and the lease mitigation requirements.
    New section 2809.14, ``What types of bids are acceptable?,'' would 
provide that your bid submission would be accepted by the BLM only if 
it included the minimum bid established in the competitive offer plus 
at least 20 percent of your bonus bid and you are able to show to the 
BLM's satisfaction that you are qualified to hold a right-of-way by 
meeting the requirements in section 2803.10.
    Paragraph (b) of this section would provide that a minimum bid 
would consist of three components. The first component would be for 
reimbursement of administrative costs incurred by the BLM and other 
Federal agencies in preparing and conducting the competitive offer. 
Administrative costs would include all costs required for the agency to 
comply with NEPA plus any other associated costs, including costs 
identified by other Federal agencies. As mentioned in the general 
discussion section of this preamble, administrative costs are not a 
component of fair market value and would be used to reimburse the 
Federal Government for its work in processing the sale and performing 
other necessary work.
    The second component of the minimum bid would be an amount 
determined by the authorized officer specifically for each competitive 
offer. The BLM would consider known values of the parcel when 
determining this amount, which include, but are not limited to, the 
acreage rent, megawatt capacity fee and the costs of habitat 
mitigation. For example, the BLM may have identified values for the 
mitigation of the habitat of the desert tortoise in management plans, 
or other such documents. The authorized officer would identify these 
factors and explain how they were used to determine this amount. The 
third component would be a bonus bid submitted by the bidder as part of 
a bid package. This amount would be determined by the bidder.
    In other programs, the minimum bid is often a statutory requirement 
or is based on fair market value of the resource, but there are no 
statutory requirements for the minimum bid proposed here. The acreage 
rent is based on the value of the land, and the MW capacity fee is 
based on the value of the industrial use of the land. Some other 
factors that may be considered are habitat mitigation and 
archaeological clearances or recovery of artifacts. The BLM proposes to 
base this minimum bid on factors such as these that are known values or 
limitations of the parcel. The minimum bid amount, how it was 
determined, and the factors used in this determination would be clearly 
articulated in the notice of competitive offer for each parcel.
    This amount is not a determination of fair market value, but a 
point at which bidding may start. Fair market value would be received 
through a combination of the rents, MW capacity fees and the 
competitive bidding, as the process would determine what the market is 
willing and able to pay for the parcel. Payment of cost recovery fees 
would be required, but are not considered to be a part of the minimum 
bid. The minimum bid would be paid only by the successful bidder and 
would not be prorated among all of the bidders.
    As described in paragraph (c) of this section, a bonus bid would 
consist of any dollar amount that a bidder wishes to bid, beyond the 
minimum bid. The total bid equals the minimum bid plus any additional 
bonus bid amount offered. If you are not the successful bidder as 
defined in paragraph 2809.15(a), your bid would be refunded.
    Section 2809.15, ``How will BLM select the successful bidder?,'' 
would explain how the successful bidder is determined and what 
requirements they must meet in order to be offered a lease. A bidder 
with the highest total bid, prior to any variable offset, would be 
declared the successful bidder and would be offered a lease in 
accordance with section 2805.10. The BLM would determine the 
appropriate variable offset, using the criteria provided in section 
2809.16, before issuing final payment terms. If you are the successful 
bidder, your payment must be submitted to the BLM by the close of 
official business hours on the day of the offer or at such other time 
as the BLM may have specified in the offer notice. Your payment would 
be required to be made by personal check, cashier's check, certified 
check, bank draft, or money order, or by any other means deemed 
acceptable by the BLM. Your remittance must be payable to the 
``Department of the Interior--Bureau of Land Management.'' Your payment 
must include: at least 20 percent of the bonus bid prior to the offset 
described in section 2809.16 and the total amount of the minimum bid 
specified in paragraph 2809.14(b). Within 15 calendar days after the 
day of the offer, you must submit to the BLM the balance of the bonus 
bid less the variable offset (see proposed section 2809.16) and the 
acreage rent for the first full year of the solar or wind energy lease 
as provided for in paragraphs 2806.54(a) or 2806.64(a), respectively, 
to the BLM office conducting the offer or as otherwise directed by the 
BLM in the offer notice.
    Under paragraph 2809.15(e), the BLM would not offer the successful 
bidder a lease and would keep all money

[[Page 59052]]

submitted, if the requirements of paragraph 2809.15(d) are not met. In 
this circumstance, the BLM may offer the lease to the next highest 
bidder under paragraph 2809.17(b) or re-offer the lands under paragraph 
2809.17(d).
    New section 2809.16, ``When do variable offsets apply?,'' would 
provide that a successful bidder may be eligible for an offset of up to 
20 percent of the bonus bid, based on the factors identified in the 
notice of competitive offer. In providing for these offsets, the BLM 
intends to promote thoughtful and reasonable development based upon 
known environmental factors and impacts of different technologies. The 
BLM believes providing these offsets could increase the likelihood that 
a project is developed, expedite the development of that project, or 
minimize resource impacts on the affected right-of-way. The BLM 
believes these offsets would help encourage the production of clean 
renewable energy on public lands, which is a benefit to the general 
public.
    The notice of competitive offer would identify each factor of the 
variable offset and the specific percentage for each factor that would 
be applied to the bonus bid, up to a maximum of 20 percent. The BLM 
would also list the documentation required to be submitted to qualify 
for the offset prior to the day of the offer and determine the amount 
of the offset prior to the competitive offer. The authorized officer 
would determine these offsets for each competitive offer based on the 
parcel(s) to be offered. In setting the offsets, the BLM would consider 
the parcel and its environmental concerns or technological limitations.
    For example, the BLM may offer a 5 percent offset to a bidder that 
has a PPA. This offset could encourage a bidder to secure an agreement 
before the offer, which could increase the likelihood of a project 
being developed and expedite the completion of such development.
    In the BLM's experience with solar and wind energy developments, a 
project is not always developed after a right-of-way is issued. Based 
on this experience, the BLM believes that a bidder with an agreement in 
place to sell power would be more likely to develop a project on the 
right-of-way. This could prevent the unnecessary encumbrance of a 
right-of-way that is issued to a holder that never develops the 
intended project.
    The BLM may also offer an offset for thoughtful and reasonable 
development. For example, the BLM may offer a 5 percent offset to a 
bidder that would use a particular technology. The BLM may identify a 
preferred technology type to reduce impacts to identified environmental 
or cultural resources.
    The BLM anticipates selected offsets to be in increments of 5 
percent to be reviewed at the BLM Washington Office for consistency and 
relevance prior to each competitive offer made in the first several 
years after publication of the final rule.
    The BLM may offer a different percentage for each offset based on 
how qualified the bidder is for the offset. For example, the BLM may 
offer a 3 percent offset for an interim step in the PPA process or a 5 
percent offset for a signed PPA. The BLM acknowledges that in some 
circumstances qualifying for these offsets may be difficult. For this 
reason, the BLM may offer incremental offsets to bidders who are 
working towards such qualifications. These offsets would be identified 
in the notice of competitive offer (see paragraph 2809.13(b)(6)).
    The variable offset may include, but is not limited to, the 
following factors:
    1. Power purchase agreement. This could be a signed agreement 
between the potential lessee and an entity that agrees to purchase the 
power generated from the solar or wind energy facility;
    2. Large generator interconnect agreement. This would consist of a 
signed agreement from the holder of an electrical transmission facility 
and the potential lessee that power would be accepted on the grid 
controlled by the holder to be transported to a power receiving source;
    3. Preferred solar or wind energy technologies. This would be an 
incentive to use technologies for generating or storing solar or wind 
energy that would efficiently use public lands or reduce impacts to 
identified resources;
    4. Prior site testing and monitoring inside the designated leasing 
area. This would consist of evidence that the potential lessee or 
others associated with the lessee had previously performed appropriate 
testing or monitoring to determine the suitability and capability of 
the site for establishment of a successful solar or wind energy 
generating facility;
    5. Pending applications inside the designated leasing area. This 
would be a situation where the potential lessee had previously filed 
for authorization to construct facilities inside the designated leasing 
area;
    6. Submission of nomination fees. These are required when 
submitting a formal nomination (see section 2809.11);
    7. Timeliness of project development, financing, and economic 
factors. This would include documentation that financing has been 
arranged for the project and provides an incentive to promote an 
expedited development timeframe for a project;
    8. Environmental benefits. This factor would include any positive 
environmental considerations such as identifying and salvaging 
archaeological or historical artifacts, additional protection for 
protected plant or animal species or similar factors;
    9. Holding a solar or wind energy lease on adjacent or mixed land 
ownership. This could show the bidder's vested interest in developing 
the right-of-way;
    10. Public benefits. These could include documented commitments or 
agreements to provide jobs or other support for local communities, or 
supporting local public purposes projects; or
    11. Other similar factors. This could include support for other 
Federal Government programs or national security by providing power for 
defense purposes or meeting government purchase contracts.
    New section 2809.17, ``Will BLM ever reject bids or re-conduct a 
competitive offer?'' would identify situations where the BLM may reject 
a bid, offer a lease to another bidder, re-offer a parcel, or actions 
the BLM may take when no bids are received. Under paragraph 2809.17(a), 
the BLM could reject bids regardless of the amount offered. Bid 
rejection could be for various reasons, such as discovery of resource 
values that cannot be mitigated through stipulations (e.g., the only 
known site of a rare or endangered plant, or for security purposes). If 
this occurs you would be notified and the notice would explain the 
reason(s) for the rejection and whether you are entitled to any 
refunds. If the BLM rejects a bid, the bidder may appeal that decision 
under Sec.  2801.10.
    The BLM has the option to offer the lease to the next highest 
qualified bidder if the first successful bidder is later disqualified 
or does not sign and accept the offered lease (paragraph 2809.17(b)).
    Under paragraph 2809.17(c), the BLM could re-offer a parcel if it 
cannot determine a successful bidder, such as in the case of a tie, or 
when a successful bidder is later determined to be unqualified to hold 
a lease.
    Under proposed paragraph 2809.17(d), if public lands offered under 
the provisions at section 2809.13 receive no bids, the BLM could 
reoffer the parcels through the competitive process under section 
2809.13 or make the lands available through the non-competitive process 
found in subparts 2803, 2804,

[[Page 59053]]

and 2805. If the lands are then offered on a noncompetitive basis, the 
successful applicant would receive a right-of-way grant, rather than a 
lease, and the offsets described in section 2809.16 would not apply.
    Section 2809.18 would list the terms and conditions of solar and 
wind energy leases issued inside designated leasing areas.
    Under paragraph (a) of this section, the term of a lease inside 
designated leasing areas would be 30 years and the lessee may apply for 
renewal under section 2805.14. While leases outside of designated 
leasing areas would be for a term up to 30 years, leases inside 
designated leasing areas would be guaranteed a lease term of 30 years.
    Under paragraph (b) of this section, a lessee must pay rent as 
specified in section 2806.54 if the lease is for solar energy 
development or section 2806.64 if the lease is for wind energy 
development. The BLM's authority to collect market value rent is 
derived from Section 304(a) of FLPMA (43 U.S.C. 1734). Rent is 
discussed in greater detail in the rental parts of the section-by-
section analysis.
    Under paragraph (c) of this section, a lessee must submit, within 2 
years of the lease issuance date, a POD that: (1) Is consistent with 
the development schedule and other requirements in the POD template 
posted on the BLM's Web site (http://www.blm.gov/wo/st/en/prog/energy/renewable_energy.html); and (2) Addresses all pre-development 
and development activities. A POD is often required for rights-of-way 
under existing paragraph 2804.25(b). Due to their complexity, solar and 
wind energy development projects would always require submittal of a 
POD. The submitted POD would provide site-specific information that 
would be reviewed by the BLM and other Federal agencies in accordance 
with NEPA and other relevant laws.
    Under paragraph (d) of this section, cost recovery, a lessee must 
pay the reasonable costs for the BLM or other Federal agencies to 
review and process the POD and to monitor the lease. The authority for 
collecting costs is derived from Section 304(b) of FLPMA (43 U.S.C. 
1734) that provides for the deposit of payments to reimburse the BLM 
for reasonable costs with respect to applications and other documents 
relating to the public lands. Such costs may be determined based upon 
consideration of actual costs. A lessee may choose to pay full actual 
costs for the review of the POD and the monitoring activities of the 
lease. Through the BLM's experience, a lessee is more likely to choose 
payment of full actual costs as this expedites the BLM's review and 
monitoring actions by removing administrative steps in cost estimations 
and verifying estimated account balances.
    Under paragraph (e) of this section, a lessee would have to provide 
a performance and reclamation bond for a solar or wind energy project. 
Bond amounts inside designated leasing areas would be set at a standard 
dollar amount (per acre for solar, or per turbine for wind) for either 
solar or wind energy development. See section 2805.20 of this preamble 
for additional information on the determination of these bond amounts. 
As explained in the general discussion section of this preamble, the 
BLM does not intend to change the amount of a standard bond after the 
lease is issued unless there is a change in use.
    For a solar energy development project, a lessee would be required 
to provide a bond in the amount of $10,000 per acre at the time the BLM 
approves the POD. See the discussion at paragraph 2805.20(b) for 
additional information. For a wind energy development project, a lessee 
would be required to provide a bond in the amount of $20,000 per 
authorized turbine at the time the BLM approves the POD. See the 
discussion at paragraph 2805.20(c) for additional information.
    The BLM would adjust the solar or wind energy development bond 
amounts for inflation every 10 years by the average annual change in 
the IPD-GDP for the preceding 10-year period and round it to the 
nearest $100. This 10 year average would be adjusted at the same time 
as the Per Acre Rent Schedule for linear rights-of-way under section 
2806.22.
    Under paragraph (f) of this section, a lessee may assign a lease 
under section 2807.21, and if an assignment is approved, the BLM would 
not make any changes to the lease terms or conditions, as provided in 
paragraph 2807.21(f).
    Under paragraph (g) of this section, a lessee must start 
construction of a project within 5 years and begin generating 
electricity no later than 7 years from the date of lease issuance, as 
specified in the approved POD. The approved POD would outline the 
specific development requirements for the project, but all PODs would 
require a lessee to start generating electricity within 7 years. The 5 
years to start construction and 7 years to begin generating electricity 
proposed in the rule should allow most lessees time to construct and 
start generation of electricity and give a leaseholder time to address 
any concerns that are outside of the BLM's authority. Such concerns 
include PPAs or private land permitting or site control transactions. A 
request for an extension may be granted for up to 3 years with a show 
of good cause and approval by the BLM. Should a leaseholder be unable 
to meet this due diligence timeframe, the BLM may terminate the lease.
    New section 2809.19 would explain how the BLM would process 
applications in designated leasing areas or on lands that later become 
designated leasing areas. Under the proposed rule, lands inside 
designated leasing areas would be offered through the competitive 
bidding process described in this subpart and applications may not be 
filed inside these areas after the lands have been designated as such.
    Paragraph (a) of this section would explain how the BLM would 
process applications filed for solar or wind energy development on 
lands outside of designated leasing areas that subsequently become 
designated leasing areas. If the application was filed before the BLM 
published the notice of availability of the draft or proposed land use 
plan amendment to designate the solar or wind leasing area, the 
application would continue to be processed by the BLM and it would not 
be subject to the competitive leasing offer process in this subpart. 
The notice of availability is the first official public notice of the 
BLM's intent to designate these lands. After publication of this 
notice, the public will have been notified of the BLM's intent to 
create a designated leasing area. If an application is submitted prior 
to publication of the notice of availability, the applicant would have 
had no way of knowing the BLM's intent and therefore the BLM would 
continue to process the application.
    If an application is filed after the notice of availability of the 
draft land use plan amendment to identify the land as a designated 
leasing area, the application would remain in a pending status, unless 
it is either withdrawn by the applicant or the BLM denies it. When the 
subject lands do become available for leasing under this subpart, the 
applicant could submit a bid for the lands under this subpart. Any 
entity with an application pending on a parcel that submits a bid on 
such parcel may qualify for a variable offset as provided for under 
section 2809.16. The applicant would not receive a refund for any 
application fees or processing costs incurred if the lands described in 
the application are later leased to another entity under section 
2809.12. The rationale for these provisions is to

[[Page 59054]]

ensure that as many parcels as possible are leased and developed 
appropriately.
    Under proposed paragraph (b), the BLM would not accept a new 
application for solar or wind energy development inside designated 
leasing areas after the effective date of this rule (see paragraph 
2804.10(c)(2)).
    Under paragraph (c) of this section, the BLM would be able to 
authorize short term (3-year) grants for testing and monitoring 
purposes inside designated leasing areas. These would be processed in 
accordance with paragraphs 2805.11(b)(2)(i) or 2805.11(b)(2)(ii). These 
testing grants may qualify an entity for a variable offset under 
paragraph 2809.16(b)(4).

Section-by-Section Analysis for Part 2880

    The BLM is proposing revisions to several subparts of part 2880. 
These revisions are necessary to ensure consistency of policies, 
processes, and procedures, where possible, between rights-of-way 
applied for and administered under part 2800 and those applied for and 
those rights-of-way administered under part 2880. Specific areas where 
we are proposing consistency changes include: Bonding requirements; 
determination of initial rental payment periods; and when you must 
contact the BLM, including grant, lease, and temporary use permit (TUP) 
modification requests, assignments, and renewal requests. In addition, 
the BLM is proposing pre-application requirements and fees for any 
transmission line with a capacity of 100 kV or more, or any pipeline 10 
inches or more in diameter (see section 2884.10), similar to those 
being proposed for all solar energy and wind energy projects. 
Authorizations for solar or wind energy, for any transmission line with 
a capacity of 100 kV or more, or any pipeline 10 inches or more in 
diameter, are all generally large-scale operations that require 
additional steps to help protect the public land.
    The heading for subpart 2884 would be revised to read ``Applying 
for MLA Grants and TUPs.'' This change would more accurately represent 
the contents of the subpart.
    Section 2884.10 would be revised to parallel the changes being made 
to section 2804.10. These changes include pre-application requirements 
for applicants for any transmission line with a capacity of 100 kV or 
more, or any pipeline 10 inches or more in diameter. Some changes are 
the additional pre-application meetings, payment of reasonable costs, 
and a list of the reasons why the BLM would not accept such 
applications. For a detailed discussion of these changes, see section 
2804.10 of this preamble.
    Section 2884.11 would require a POD if an application is for an oil 
or gas pipeline that is 10 inches or more in diameter. As previously 
discussed, PODs are often required under section 2804.25. A POD would 
be required in this paragraph due to the potentially large on-the-
ground impacts of these pipelines.
    Section 2884.12 would explain fees associated with an application, 
including those that involve Federal agencies other than the BLM. The 
applicant may pay either the BLM for work done by those Federal 
agencies or pay those Federal agencies directly for their work. This 
authority was recently delegated by Secretarial Order 3327 and would be 
reflected in the final regulations.
    Paragraph (b) of this section would revise the processing fee 
schedule to remove the 2005 category fees. Amended paragraph (c) would 
provide instructions on where you may obtain a copy of the current 
processing fee schedule. These changes parallel those made to section 
2804.14, which describe processing fees for grant applications. A 
further analysis of these changes can be found in that part of the 
section-by-section analysis.
    Section 2884.16 would be revised to require that Master Agreements 
describe existing agreements with other Federal agencies for cost 
reimbursement associated with the application. This change parallels 
changes in proposed section 2804.18, which describes Master Agreements 
for all other rights-of-way. With the authority recently delegated by 
Order 3327 to collect costs for other Federal agencies, it is important 
for the applicant, the BLM, and other Federal agencies to coordinate 
and be consistent regarding cost reimbursement.
    Section 2884.17 would explain how the BLM processes Category 6 
applications and these changes would parallel changes in proposed 
section 2804.19. Under paragraph (e) of this section, the BLM may 
collect reimbursement for the United States for actual costs with 
respect to applications and other document processing relating to 
Federal lands. The authority delegated by Secretarial Order 3327 
requires more coordination and promotes consistency between the Federal 
agencies.
    Section 2884.18 would parallel proposed section 2804.23. Under 
paragraph (a)(1) of this section, the requirement to reimburse the BLM 
would be expanded to allow for cost reimbursement from all Federal 
agencies for the processing of these right-of-way authorizations.
    Under paragraph (c) of this section, the BLM may offer lands 
through a competitive process on its own initiative.
    Under section 2884.20, the phrase ``or use other notification 
methods including the Internet'' would be added to paragraphs (a) and 
(d) to provide for an additional avenue to notify the public of a 
pending application or to announce any public hearings or meetings. 
This language would be consistent with changes made to other 
notification language throughout this proposed rule.
    Under section 2884.21, the BLM would not process your application 
if you have any trespass action pending for any activity on BLM 
administered lands (see section 2888.11) or have any unpaid debts owed 
to the Federal Government. The only application the BLM would process 
to resolve the trespass would be for a right-of-way as authorized in 
this part, or a lease or permit under the regulations found at 43 CFR 
part 2920, but only after outstanding debts are paid. This provision is 
being added to provide incentives for the applicant to resolve 
outstanding debts or other infractions involving the Federal Government 
and parallels proposed section 2804.25.
    The notification language in paragraph (d)(4) would be amended by 
adding the phrase ``or use other notification methods including the 
Internet.'' This language would be consistent with changes made to 
other notification language throughout this rule.
    Section 2884.23 would describe the circumstances under which the 
BLM may deny an application. Under new paragraph 2884.23(a)(6), the BLM 
may deny an application if the required POD fails to meet the 
development schedule and other requirements for oil and gas pipelines. 
This language is necessary to enforce the requirements of new 
paragraphs 2884.10(d)(3) and 2884.11(c)(5).
    Section 2884.24 would parallel changes made to section 2804.27 and 
would require an applicant to pay any pre-application costs submitted 
under paragraph 2884.10(b)(4). See section 2804.27 for further 
discussion.
    Section 2885.11 explains the terms and conditions of a grant. 
Paragraph (a) of this section would be revised by adding the phrase 
``with the initial year of the grant considered to be the first year of 
the term.'' This revision would clarify, for example, that a 30-year 
grant issued on September 1, 2013, would expire on December 31, 2042, 
and have

[[Page 59055]]

an effective term of 29 years and 4 months. This is consistent with 
existing policy and procedure. For all grants issued under this section 
with terms greater than 3 years, the actual term would include the 
number of full years including any partial year. The term for a MLA 
grant differs from a term for rights-of-way authorized under FLPMA, as 
FLPMA rights-of-way may be issued for periods greater than 30 years, 
while a MLA right-of-way may be issued for a maximum period of 30 
years. If a 30 year FLPMA grant is issued on a date other than the 
first of a calendar year, that partial year would count as additional 
time of the grant (see discussion of paragraph 2805.11 earlier in this 
preamble section).
    A new sentence would be added to the end of paragraph 2885.11(b)(7) 
referencing new section 2805.20. Proposed section 2805.20 would explain 
the bonding requirements for all rights-of-way. This reference would 
direct readers to the bonding requirements.
    Revisions to section 2885.15 would clarify that there are no 
reductions of rents for grants or TUPs, except as provided under 
paragraph 2885.20(b). Paragraph 2885.20(b) is an existing provision 
under which a grant holder can qualify for phased-in rent. This change 
is only a clarification and cross-reference to existing regulations.
    Revisions to section 2885.16 would clarify that the BLM prorates 
the initial rental amount based on the number of full months left in 
the calendar year after the effective date of the grant or TUP. If your 
grant qualifies for annual payments, the initial rent bill consists of 
the remaining partial year plus the next full year. For example, the 
initial rental bill for a grant issued on September 1 would be for 1 
year and 3 months if the grant qualifies for annual billing. The 
initial rental bill for the same grant would be for 9 years and 3 
months if the grant does not qualify for annual billing. This is a new 
provision that would parallel paragraph 2806.24(c) and would create 
consistency in how all rights-of-way are prorated.
    Section 2885.17(e) would parallel proposed section 2806.13(e), 
which identifies when the BLM would retroactively bill for uncollected 
or under-collected rent, late payments and administrative fees. The BLM 
would collect rent if: (1) A clerical error is identified; (2) A rental 
schedule adjustment is not applied; or (3) An omission or error in 
complying with the terms and conditions of the authorized right-of-way 
is identified.
    Section 2885.19 would be revised by updating the addresses in 
paragraph (b). Revisions to section 2885.20 would result in the removal 
of existing paragraph (b)(1), which provided for a 25 percent reduction 
in rent for calendar year 2009. This paragraph no longer applies since 
it specifically mentioned the 2009 Per Acre Rent Schedule.
    The proposed changes in section 2885.24 would parallel the proposed 
changes to other sections of this rule that contain tables with 
outdated numbers. Specific numbers would be removed from the table. 
However, the monitoring fee amounts would be available to the public in 
BLM offices or on the BLM Web site. The proposed rule would add the 
methodology for adjusting these fees on an annual basis to paragraph 
(a) of this section. Since this methodology has been added to paragraph 
(a), a description of how the BLM updates the schedule would be removed 
from paragraph (b) of this section.
    Section 2886.12 describes when a grant holder must contact the BLM 
during operations. The changes in this section would parallel the 
proposed changes to section 2807.11. A grant holder would be required 
to contact the BLM when site specific circumstances require changes to 
an approved right-of-way grant, POD, site plan, or other procedures 
even when they are not substantial deviations in location or use. These 
types of changes would be considered as grant or TUP modification 
requests. New paragraph (e) would be added to conform to similar 
provisions at paragraph 2807.11(e), which would require you to contact 
the BLM if your authorization requires submission of a certification of 
construction. See section 2807.11 for further discussion on these 
topics.
    Revisions to section 2887.11 would parallel the changes to section 
2807.21, which describes assigning or making other changes to a grant 
or lease. The title for section 2887.11 would be changed to ``May I 
assign or make other changes to my grant or TUP?''
    The existing regulations do not cover all instances where an 
assignment is necessary and also omit situations where assignments are 
not required. The proposed changes are necessary to: (1) Add and 
describe additional changes to a grant other than assignments; (2) 
Clarify what changes would require an assignment; and (3) Make right-
of-way leases subject to the regulations in this paragraph.
    Some of the proposed changes would add to paragraph (a) two events 
that may require the filing of an assignment: (1) The voluntary 
transfer by the holder of any right or interest in the right-of-way 
grant to a third party, e.g., a change in ownership; and (2) Change in 
control transactions involving the right-of-way grantee. Examples of 
changes in ownership would be: A transfer by a holder (assignor) of any 
right or interest in the grant to a third party (assignee); or changes 
in ownership or other related change involving the BLM right-of-way 
grant, including a corporate merger or acquisition. Revised paragraph 
(b) would clarify that a change in the holder's name only does not 
require an assignment.
    Revised paragraph (c) would make it clear that changes in a 
holder's articles of incorporation do not require an assignment, but if 
a holder becomes a wholly owned subsidiary of a new third party and 
still holds the grant, it may need to file new or revised information 
in conformance with subpart 2803. Paragraph (d) pertains to payments 
for assignments and would add a requirement to pay application fees in 
addition to processing fees. Also, the BLM may now condition a grant 
assignment to require payment of outstanding payments due.
    New paragraph (h) would clarify that only interests in right-of-way 
grants or leases are assignable. Pending right-of-way applications do 
not create a property right and thus may not be assigned.
    New paragraph (i) would add special application requirements to be 
evaluated if there is a change in the legal name of the right-of-way 
leaseholder. These include: (1) Requiring any corporation requesting 
such a change to supply documentation showing the name change; and (2) 
Acceptance of the name change by the State or Territory in which 
incorporated. This section would also explain that the BLM may also 
modify a grant, or add bonding and other requirements, including 
additional terms and conditions when processing a name change 
application.
    Section 2887.12 would add new paragraph (d), similar to proposed 
revisions to section 2807.22, explaining that if a holder makes a 
timely and sufficient application for renewal, the existing grant or 
lease does not expire until the application for renewal has been 
finally determined by the BLM. This provision is derived from the 
Administrative Procedures Act (5 U.S.C. 558(c)(1)) and it protects 
interests of existing right-of-way holders who have timely and 
sufficiently made an application for the continued use of an existing 
authorization. In this situation, the authorized activity does not 
expire until the application for continued use has been evaluated and a 
decision on the extension is made by the agency.

[[Page 59056]]

This would reiterate and clarify existing policy and procedures.
    Under proposed paragraph 2887.12(e), you may appeal the BLM's 
decision to deny your application under existing section 2881.10. This 
paragraph would parallel the language under existing paragraph 
2807.22(f), which would be redesignated as paragraph 2807.22(g).

V. Procedural Matters

Regulatory Planning and Review (Executive Orders 12866 and 13563)

    Executive Order 12866 provides that the Office of Information and 
Regulatory Affairs (OIRA) will review all significant rules. The Office 
of Information and Regulatory Affairs has determined that this proposed 
rule is significant because it could raise novel legal or policy 
issues.
    Executive Order 13563 reaffirms the principles of Executive Order 
12866 while calling for improvements in the nation's regulatory system 
to promote predictability, to reduce uncertainty, and to use the best, 
most innovative, and least burdensome tools for achieving regulatory 
ends. The executive order directs agencies to consider regulatory 
approaches that reduce burdens and maintain flexibility and freedom of 
choice for the public where these approaches are relevant, feasible and 
consistent with regulatory objectives. Executive Order 13563 emphasizes 
further that regulations must be based on the best available science 
and that the rulemaking process must allow for public participation and 
an open exchange of ideas. We have developed this proposed rule in a 
manner consistent with these requirements.
    This proposed rule includes provisions that are intended to 
facilitate responsible solar and wind energy development and to receive 
fair market value for such development. These provisions would:
    1. Promote the use of preferred areas for solar and wind energy 
development (i.e., designated leasing areas); and
    2. Establish competitive processes, terms, and conditions 
(including rental and bonding requirements) for solar and wind energy 
development rights-of-way both inside and outside of designated leasing 
areas.

These provisions would assist the BLM in meeting goals established in 
Section 211 of the Energy Policy Act (EPAct) of 2005 and Secretarial 
Order 3285A1. They would also assist the BLM in implementing 
recommendations of the Department's Office of the Inspector General 
regarding renewable energy development.
    In addition to provisions that would affect renewable energy 
specifically, this proposed rule also includes provisions that would 
affect all rights-of-way, and some that would affect transmission lines 
with a capacity of 100 kV or more, and pipelines 10 inches or more in 
diameter. These provisions would clarify existing regulations and 
codify existing policies.

Economic Impacts

    The proposed rule would not have an annual effect on the economy of 
$100 million or more or adversely affect in a material way the economy, 
a sector of the economy, productivity, competition, jobs, the 
environment, public health or safety, or State, local, or tribal 
governments or communities. The BLM anticipates the proposed rule would 
increase total costs to all applicants, lessees, and operators by no 
more than $5.7 million per year. Of this increase in costs to 
operators, $4.8 million of this total figure is the amount of the 
estimated bonus bids. The increase in fees and rentals over the fees 
and rentals currently set by policy primarily reflect changing market 
conditions. Increases in the minimum bond amounts also reflect 
increases in estimated reclamation costs. These impacts are discussed 
in detail in the Economic and Threshold Analysis for the proposed rule.

Other Agencies

    The proposed rule would not create a serious inconsistency or 
otherwise interfere with another agency's actions or plans. The BLM is 
the only agency that may promulgate regulations for rights-of-way on 
public lands.

Budgetary Impacts

    This proposed rule would not materially alter the budgetary effects 
of entitlements, grants, user fees, or loan programs or the rights or 
obligations of their recipients.

Novel Legal or Policy Issues

    This proposed rule could raise novel legal or policy issues. It 
would codify existing BLM policies and provide additional detail about 
submitting applications for solar or wind energy development grants 
outside designated leasing areas, for transmission lines with a 
capacity of at least 100 kV, and for pipelines 10 inches in diameter or 
larger. In addition, the proposed rule would provide for a competitive 
process for seeking solar and wind energy development leases inside of 
designated leasing areas.

Clarity of the Regulations

    Executive Order 12866 also requires each agency to write 
regulations that are simple and easy to understand. The BLM invites 
your comments on how to make this proposed rule easier to understand, 
including answers to questions such as the following:
    1. Are the requirements in the proposed rule clearly stated?
    2. Does the proposed rule contain technical language or jargon that 
interferes with its clarity?
    3. Does the format of the proposed rule (grouping and order of 
sections, use of headings, paragraphing, etc.) aid or reduce its 
clarity?
    4. Would the regulations be easier to understand if they were 
divided into more (but shorter) sections?
    5. Is the description of the proposed rule in the SUPPLEMENTARY 
INFORMATION section of this preamble helpful in understanding the 
proposed rule? How could this description be more helpful in making the 
proposed rule easier to understand?
    Please send any comments you have on the clarity of the regulations 
to the address specified in the ADDRESSES section.

National Environmental Policy Act (NEPA)

    The proposed regulatory amendments are of an administrative or 
procedural nature and, therefore, are categorically excluded from the 
requirement to prepare an environmental assessment (EA) or EIS. See 43 
CFR 46.205 and 46.210(i). They do not present any of the extraordinary 
circumstances listed at 43 CFR 46.215.
    Nonetheless, the BLM has drafted an EA to inform agency decision-
makers and welcomes input from the public on the draft EA's assessment 
of the effects of the proposed rule. The draft EA incorporates by 
reference the Final Solar Energy Development Programmatic Environmental 
Impact Statement (July 2012) and the Final Programmatic Environmental 
Impact Statement on Wind Energy Development on BLM-Administered Lands 
in the Western United States (June 2005). To obtain single copies of 
the Programmatic EISs or the draft EA, you may contact the person 
listed under the section of this rule titled, FOR FURTHER INFORMATION 
CONTACT. You may also view the EA/FONSI and Programmatic Environmental 
Impact Statements at, respectively, http://windeis.anl.gov/, http://solareis.anl.gov/, and http://www.blm.gov/wo/st/en/prog/energy/renewable_energy.html.

[[Page 59057]]

Regulatory Flexibility Act

    Congress enacted the Regulatory Flexibility Act of 1980 (RFA), as 
amended, 5 U.S.C. 601-612, to ensure that Government regulations do not 
unnecessarily or disproportionately burden small entities. The RFA 
requires a regulatory flexibility analysis if a rule would have a 
significant economic impact, either detrimental or beneficial, on a 
substantial number of small entities. For the purposes of this 
analysis, the BLM assumes that all entities (all lessees and operators) 
that may be affected by this rule are small entities, even though that 
is not actually the case.
    This proposed rule would not have a significant economic effect on 
a substantial number of small entities under the RFA.
    The proposed rule would affect new applicants or bidders for 
authorizations of solar or wind energy development, transmission lines 
100 kV or more, and pipelines 10 inches or more in diameter. The BLM 
reviewed current holders of such authorizations to determine whether 
they are small businesses as defined by the SBA. The BLM was unable to 
find financial reports or other information for all potentially 
affected entities, so this analysis assumes that the rule could 
potentially affect a substantial number of small entities.
    To determine the extent to which the proposed rule would impact 
these small entities, we took two approaches. First, we attempted to 
measure the direct costs of the proposed rule as a portion of the net 
incomes of affected small entities. However, we were unable to obtain 
the financial records for a representative sample. Next, we estimated 
the direct costs of the proposed rule as a portion of the total costs 
of a project.
    The analysis showed that a range of potential impacts on the total 
cost of a project varied from a savings of 0.04 percent to a cost of 
1.58 percent of the total project cost. The BLM determined that this 
was an insignificant impact in the context of developing a project and 
therefore not a significant economic impact on a substantial number of 
small businesses. For a more detailed discussion, please see the 
economic analysis.

Small Business Regulatory Enforcement Fairness Act

    For the same reasons as discussed under the Executive Order 12866, 
Regulatory Planning and Review section of this preamble, this proposed 
rule is not a ``major rule'' as defined at 5 U.S.C. 804(2). That is, it 
would not have an annual effect on the economy of $100 million or more; 
it would not result in major cost or price increases for consumers, 
industries, government agencies, or regions; and it would not have 
significant adverse effects on competition, employment, investment, 
productivity, innovation, or the ability of U.S.-based enterprises to 
compete with foreign-based enterprises.

Unfunded Mandates Reform Act

    This proposed rule would not impose an unfunded mandate on State, 
local, or tribal governments, in the aggregate, or the private sector 
of $100 million or more per year; nor would it have a significant or 
unique effect on State, local, or tribal governments. The amendment of 
portions of the regulations found at 43 CFR parts 2800 and 2880, 
redesignated the existing 43 CFR part 2809 in its entirety to a new 
paragraph found at Sec.  2801.6(a)(2) and promulgation of revised 43 
CFR part 2809, and modifying the MLA pipeline regulations in 43 CFR 
part 2880 would not result in any unfunded mandates. Therefore, the BLM 
does not need to prepare a statement containing the information 
required by Sections 202 or 205 of the Unfunded Mandates Reform Act 
(UMRA), 2 U.S.C. 1531 et seq. The proposed rule is also not subject to 
the requirements of Section 203 of UMRA because it contains no 
regulatory requirements that might uniquely affect small governments, 
nor does it contain requirements that either apply to such governments 
or impose obligations upon them.

Executive Order 12630, Governmental Actions and Interference With 
Constitutionally Protected Property Rights (Takings)

    This proposed rule is not a government action that interferes with 
constitutionally protected property rights. This proposed rule would 
set out a process that would provide guidance for competitive renewable 
energy solar and wind energy development processes and certain 
pipelines and electric transmission facilities on BLM-managed public 
lands. It establishes a fee schedule for various components of the 
development of such facilities inside SEZs and sites for wind energy 
that are conducive to competitive right-of-way leasing and clarifies a 
process that would rely on the BLM's existing land use planning system 
to allow for these types of uses. Also, the rule would set out 
additional requirements for rights-of-way for pipelines exceeding 10 
inches in diameter or transmission lines having a capacity of 100 kV or 
greater. This revised process would promote the orderly administration 
of the public lands. Because any land use authorizations and resulting 
development of facilities under this proposed rule would be subject to 
valid existing rights, it does not interfere with constitutionally 
protected property rights. Therefore, the Department has determined 
that this proposed rule does not have significant takings implications 
and does not require further discussion of takings implications under 
this Executive Order.

Executive Order 13132, Federalism

    The BLM has determined that this proposed rule would not have a 
substantial direct effect on the States, or the relationship between 
the national Government and the States, or on the distribution of power 
and responsibilities among the various levels of government. It would 
not apply to State or local governments or State or local government 
entities. Therefore, in accordance with Executive Order 13132, the BLM 
has determined that this proposed rule does not have sufficient 
Federalism implications to warrant preparation of a Federalism 
Assessment.

Executive Order 12988, Civil Justice Reform

    Under Executive Order 12988, the Department has determined that 
this proposed rule would not unduly burden the judicial system and that 
it meets the requirements of sections 3(a) and 3(b)(2) of the Order. 
The Department's Office of the Solicitor has reviewed the proposed rule 
to eliminate drafting errors and ambiguity. It has been written to 
minimize litigation, provide clear legal standards for affected conduct 
rather than general standards, and promote simplification and avoid 
unnecessary burdens.

Executive Order 13175, Consultation and Coordination With Indian Tribal 
Governments

    In accordance with Executive Order 13175, the BLM has found that 
this proposed rule does not have significant tribal implications. On a 
case-by-case basis, existing regulations require any right-of-way 
applicant to consult with tribes to discuss the proposed action and 
other aspects of the proposed project. Designated leasing areas would 
be identified through the BLM's land use planning process. These areas 
would be designated using the same process that current regulations use 
to identify right-of-way corridors and have the same tribal 
consultation components. In addition to the preliminary review covered 
in the planning process, the proposed

[[Page 59058]]

regulations require site-specific consultation. In lands outside 
designated leasing areas, site-specific requirements would include pre-
application and public meetings. The BLM would be able to deny an 
application after these meetings based on a variety of criteria, 
including tribal concerns. The proposed rule would call for further 
tribal consultation by the BLM and right-of-way applicants, but the 
rulemaking itself is administrative in nature and does not establish 
any designated leasing areas, and, therefore, does not require tribal 
consultation.

Data Quality Act

    In developing this proposed rule, the BLM did not conduct or use a 
study, experiment, or survey requiring peer review under the Data 
Quality Act (Section 515 of Public Law 106-554). In accordance with the 
Data Quality Act, the Department has issued guidance regarding the 
quality of information that it relies upon for regulatory decisions. 
This guidance is available at the Department's Web site at: http://www.doi.gov/archive/ocio/iq.html.

Executive Order 13211, Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution, or Use

    Executive Order 13211 requires Federal agencies to prepare and 
submit to OMB, a Statement of Energy Effects for any proposed 
significant energy action. A ``significant energy action'' is defined 
as any action by an agency that: (1) Is a significant regulatory action 
under Executive Order 12866, or any successor order; (2) Is likely to 
have a significant adverse effect on the supply, distribution, or use 
of energy; or (3) Is designated by the Administrator of OIRA as a 
significant energy action.
    This proposed rule could raise novel legal or policy issues within 
the meaning of Executive Order 12866 or any successor order. However, 
the BLM believes this proposed rule is unlikely to have a significant 
adverse effect on the supply, distribution, or use of energy, and could 
have a positive impact on energy supply, distribution, or use. In fact, 
its intent is to facilitate such development. The rule would codify BLM 
policies and provide additional detail about the process for submitting 
applications for solar or wind energy development grants outside 
designated leasing areas, for solar or wind energy development leases 
inside designated leasing areas, for transmission lines with a capacity 
of 100 kV or more, and for pipelines 10 inches or more in diameter.

Executive Order 13352, Facilitation of Cooperative Conservation

    In accordance with Executive Order 13352, the BLM has determined 
that this proposed rule would not impede the facilitation of 
cooperative conservation. The rule takes appropriate account of and 
respects the interests of persons with ownership or other legally 
recognized interests in land or other natural resources; properly 
accommodates local participation in the Federal decision-making 
process; and provides that the programs, projects, and activities are 
consistent with protecting public health and safety.

Paperwork Reduction Act

    The Paperwork Reduction Act (PRA) (44 U.S.C. 3501-3521) provides 
that an agency may not conduct or sponsor, and a person is not required 
to respond to, a collection of information, unless it displays a 
currently valid OMB control number. Collections of information include 
requests and requirements that an individual, partnership, or 
corporation obtain information, and report it to a Federal agency. See 
44 U.S.C. 3502(3); 5 CFR 1320.3(c) and (k).
    This proposed rule contains information collection requirements 
that are subject to review by OMB under the Paperwork Reduction Act (44 
U.S.C. 3501-3520). Collections of information include any request or 
requirement that persons obtain, maintain, retain, or report 
information to an agency, or disclose information to a third party or 
to the public (44 U.S.C. 3502(3) and 5 CFR 1320.3(c)).
    OMB has approved the existing information collection requirements 
associated with rights-of-way and has assigned Control Number 0596-0082 
to those requirements. That control number is administered by the U.S. 
Forest Service and authorizes several Federal agencies to use Form SF-
299 (Application for Transportation and Utility Systems and Facilities 
on Federal Lands).
    The BLM has requested OMB approval for a new control number and is 
inviting public comment on its request for:
    1. Proposed information collection requirements supplemental to SF-
299; and
    2. Other proposed information collection requirements.
    The information collection activities in this proposed rule are 
described below along with estimates of the annual burdens. Included in 
the burden estimates are the time for reviewing instructions, searching 
existing data sources, gathering and maintaining the data needed, and 
completing and reviewing each component of the proposed information 
collection requirements.
    The information collection request for this proposed rule has been 
submitted to OMB for review under 44 U.S.C. 3507(d). A copy of the 
request can be obtained from the BLM by electronic mail request to 
Jayme Lopez at [email protected] or by telephone request to 202-912-
7547. The information collection request also may be viewed online at 
http://www.reginfo.gov/public/do/PRAMain.
    The BLM requests comments on the following subjects:
     Whether the collection of information is necessary for the 
proper functioning of the BLM, including whether the information will 
have practical utility;
     The accuracy of the BLM's estimate of the burden of 
collecting the information, including the validity of the methodology 
and assumptions used;
     The quality, utility, and clarity of the information to be 
collected; and
     How to minimize the information collection burden on those 
who are to respond, including the use of appropriate automated, 
electronic, mechanical, or other forms of information technology.
    If you want to comment on the information collection requirements 
of this proposed rule, please send your comments directly to OMB, with 
a copy to the BLM, as directed in the ADDRESSES section of this 
preamble. Please identify your comments with ``OMB Control Number 1004-
XXXX.'' OMB is required to make a decision concerning the collection of 
information contained in this proposed rule between 30 to 60 days after 
publication of this document in the Federal Register. Therefore, a 
comment to OMB is best assured of having its full effect if OMB 
receives it by October 30, 2014.
    At present, 4,017 responses, and 100,425 burden hours are approved 
annually for the Bureau of Land Management for SF-299 under control 
number 0596-0082. No non-hour burdens are approved. The proposed rule 
would include program changes of an additional 3,127 responses, 47,206 
burden hours, and $1,608,992 in application filing fees and processing 
fees (i.e., non-hour burdens) annually.
    Of those totals, the following would be additions to the burdens 
attributed to the Bureau of Land Management for SF-299 under control 
number 0596-0082:
     3,103 responses;
     47,146 hours; and
     $1,478,992 in application filing fees and processing fees.

[[Page 59059]]

    The remaining 24 responses, 60 hours, and $130,000 in fees would be 
included in the new control number for activities in the proposed rule 
that are not associated with SF-299 and control number 0596-0082.
    As explained above, the proposed rule would supplement the existing 
information collection requirements currently authorized by control 
number 0596-0082, and add other new information collection 
requirements.

Summary of Proposed Information Collection Requirements Supplemental to 
SF-299

    The information collection requirements currently approved for SF-
299 include the applicant's identity (for example, name, and address, 
and telephone number), project description, other data about the 
proposed project (for example, why it is necessary to cross Federal 
lands and why the project is needed), and probable effects (for 
example, environmental impacts). In addition, the proposed rule would 
require applicants to provide the information described below.
1. General Description of Proposed Project and Schedule for Submittal 
of Plan of Development
    New paragraph 2804.10(c)(4) would apply to the application 
requirements for:
     Solar or wind energy development projects outside 
designated leasing areas;
     Electric transmission lines with a capacity of 100 kV or 
more; and
     Pipelines 10 inches or more in diameter.

These types of applications would have to include a general description 
of the proposed project and a schedule for submittal of a Plan of 
Development. The new requirements are necessary in order to ensure the 
timely processing of these types of applications.
2. Application for Wind Energy Testing Grant and Application for Other 
Short Term Right-of-Way Grant Related to Solar or Wind Energy
    Both of these applications are for short term right-of-way grants. 
``Short term right-of-way grant'' is a new term that, as defined in a 
proposed amendment to 43 CFR 2801.5, would mean any grant issued for a 
term of 3 years or less for such uses as storage sites, construction 
sites, and short-term site testing and monitoring activities. The 
proposed rule provides for two general types of short-term right-of-way 
grants: (A) Short term wind energy testing grants; and (B) Other short-
term right-of-way grants.
    A. Proposed section 2804.12(a)(8) would require an ``application 
filing fee'' of $2 per acre for applications for short term wind energy 
testing grants, both inside and outside designated leasing areas. As 
defined at section 2801.5 of the proposed rule, the term ``application 
filing fee'' would mean a nonrefundable filing fee specific to solar 
and wind energy right-of-way applications.
    The BLM would adjust the application filing fee once every 10 years 
by the average annual change in the Implicit Price Deflator, Gross 
Domestic Product (IPD-GDP) for the preceding 10-year period and round 
it to the nearest one-half dollar. This fee would be necessary in order 
to defray the BLM's expenses in processing these types of applications, 
and it is in accordance with Section 304 of the Federal Land Policy and 
Management Act (43 U.S.C. 1734) and the Independent Offices 
Appropriation Act (31 U.S.C. 9701), which authorize the BLM to recover 
costs of processing applications and other documents relating to the 
public lands. Moreover, OMB Circular A-25 (titled ``User Charges'') 
provides that the Federal policy is to assess a charge against each 
identifiable recipient for special Federal benefits beyond those 
received by the general public.
    B. Proposed section 2804.30(g) would apply to applications for two 
types of grants that would authorize testing for wind energy potential 
outside designated leasing areas: (1) A site-specific grant, which 
would authorize the installation and operation of a single 
meteorological tower or other wind study facility; and (2) A project 
area grant, which would authorize the installation and operation of any 
number of meteorological towers or other wind study facilities. These 
applications would be subject to a $2 per-acre application filing fee 
in accordance with section 2804.12(a)(8).
    This regulation would allow only one applicant (i.e., a ``preferred 
applicant'') to apply for a wind energy testing grant. The preferred 
applicant would be the successful bidder in a competitive process 
beginning either with the filing of competing applications for the same 
facility or system, or with an offer by the BLM of a parcel for 
competitive bidding. In the latter process, the successful bidder also 
would have to submit the bonus bid to the BLM within 15 days of the 
date of the offer. See proposed 43 CFR 2804.30(f). This information 
collection activity is necessary for the competitive process for lands 
outside designated leasing areas.
    C. Proposed section 2805.11(b)(2)(i) through (b)(2)(iii) would 
authorize applications for the two types of wind energy testing grants 
authorized under proposed section 2804.30(g), plus short-term grants 
for geotechnical testing and other temporary land-disturbing activities 
associated with solar and wind energy. Applications for wind energy 
testing grants would be subject to a $2 per-acre application filing fee 
in accordance with section 2804.12(a)(8). Applications for other types 
of short term rights-of-way associated with solar or wind energy would 
be subject to a processing fee in accordance with section 2804.14. This 
information collection activity is necessary for the orderly management 
of activities that may precede an application for a longer term solar 
or wind energy right-of-way.
    D. Proposed section 2809.19(c) would provide a process for applying 
for short-term grants for testing and monitoring purposes inside 
designated leasing areas. This application would apply to wind energy 
testing only, and would be subject to a $2 per-acre application filing 
fee in accordance with section 2804.12(a)(8). This information 
collection activity is necessary for the competitive process for lands 
inside designated leasing areas.
3. Application for, or Request To Assign, Solar or Wind Energy 
Development Right-of-Way
    As defined at section 2801.5 of the proposed rule, the term 
``application filing fee'' would mean a nonrefundable filing fee 
specific to solar and wind energy right-of-way applications. This fee 
would be necessary in order to defray the BLM's expenses in processing 
these types of applications, and it is accordance with Section 304 of 
the Federal Land Policy and Management Act (43 U.S.C. 1734) and the 
Independent Offices Appropriation Act (31 U.S.C. 9701), which authorize 
the BLM to recover costs of processing applications and other documents 
relating to the public lands. Moreover, OMB Circular A-25 (titled 
``User Charges'') provides that the Federal policy is to assess a 
charge against each identifiable recipient for special Federal benefits 
beyond those received by the general public.
    Proposed section 2804.30(g) would allow only one applicant (i.e., a 
``preferred applicant'') to apply for a right-of-way grant outside a 
designated leasing area for a solar or wind energy development grant. 
The preferred applicant would be the successful bidder in a competitive 
process beginning either with the filing of competing applications for 
the same

[[Page 59060]]

facility or system, or with an offer by the BLM of a parcel for 
competitive bidding. In the latter process, the successful bidder also 
would have to submit the bonus bid to the BLM within 15 days of the 
date of the offer. See proposed 43 CFR 2804.30(f). The information 
required in such an application is listed at existing 43 CFR 
2804.12(a)(1) through (a)(7), which would not be amended in the 
proposed rule. This collection is necessary for the competitive process 
for lands outside designated leasing areas.
    A. Existing section 2807.21 allows a holder of a right-of-way grant 
to apply to assign any right or interest in that grant. This regulation 
also requires the proposed assignee to file an assignment application 
and follow the same procedures and standards as for a new right-of-way 
grant.
    As amended, section 2807.21 would:
     Apply the requirements for assignments to right-of-way 
leases as well as grants;
     Add a list of actions that may require an assignment; and
     Provide that a change in the holder's name only does not 
constitute an assignment.
    B. Proposed section 2804.12(a)(8) would require an ``application 
filing fee'' of $15 per acre for applications for, and requests to 
assign, solar and wind energy development rights-of-way.
    The BLM would adjust the application filing fee once every 10 years 
by the average annual change in the Implicit Price Deflator, Gross 
Domestic Product (IPD-GDP) for the preceding 10-year period and round 
it to the nearest one-half dollar. This information collection activity 
is necessary for the orderly administration of right-of-way leases and 
grants.
4. Application for Renewal of Wind Energy Project Area Testing Grant or 
Other Short Term Grant
    Proposed sections 2805.11(b)(2)(ii) and 2805.14(h) would authorize 
holders of short term grants for wind energy project area testing to 
apply for a renewal of up to three years, so long as the renewal 
application is accompanied by a wind energy development application and 
a Plan of Development. Authorizations for wind energy site specific 
testing would not be renewable.
    Proposed section 2805.11(b)(2)(iii) would authorize holders of 
other types of short term testing and monitoring grants (for example, 
geotechnical testing) to apply for a renewal of up to three years. 
Processing fees in accordance with 43 CFR 2804.14, as amended, would 
apply to these renewal applications.
    These opportunities for renewal of short term grants are necessary 
in order to enable the completion of complex testing of wind energy 
potential, and in order to apprise the BLM whether or not the holder of 
an expiring short term right-of-way intends to proceed with 
development.
5. Environmental, Technical, and Financial Records, Reports, and Other 
Information
    Proposed 43 CFR 2805.12(a)(15) would authorize the BLM to require a 
holder of any type of right-of-way to provide, or give the BLM access 
to, any pertinent environmental, technical, and financial records, 
reports, and other information. The BLM would use the information for 
monitoring and inspection activities.
6. Application for Renewal of Solar or Wind Energy Development Grant or 
Lease
    Proposed amendments to 43 CFR 2805.14 and 2807.22 would authorize 
holders of leases and grants to apply for renewal of their rights-of-
way. Processing fees in accordance with 43 CFR 2804.14, as amended, 
would apply to these renewal applications. The BLM would use the 
information to decide whether to renew rights-of-way.
7. Request for Amendment or Name Change (FLPMA)
    Proposed sections 2807.14(g) and 2807.22 would require a holder of 
any type of FLPMA right-of-way to contact the BLM:
     Before engaging in any activity that is a ``substantial 
deviation'' from what is authorized;
     Whenever site-specific circumstances or conditions arise 
that result in the need for changes that are not substantial 
deviations;
     Before assigning, in whole or in part, any right or 
interest in a grant or lease; and
     Before changing the name of a holder (i.e., when the name 
change is not the result of an underlying change in control of the 
right-of-way).
    A request for an amendment of a right-of-way would be required in 
cases of a substantial deviation (for example, a change in the 
boundaries of the right-of-way, major improvements not previously 
approved by the BLM, or a change in the use of the right-of-way). Other 
changes, such as changes in project materials, or changes in mitigation 
measures within the existing, approved right-of-way area, would be 
required to be submitted to the BLM for review and approval. In order 
to assign a grant, the proposed assignee must file an assignment 
application and follow the same procedures and standards as for a new 
grant or lease, as well as pay application and processing fees. In 
order to request a name change, the holder would be required to file an 
application and follow the same procedures and standards as for a new 
grant or lease and pay processing fees, but no application fee would be 
required. The following documents are also required in the case of a 
name change:
     A copy of the court order or legal document effectuating 
the name change of an individual; or
     If the name change is for a corporation, a copy of the 
corporate resolution proposing and approving the name change, a copy of 
a document showing acceptance of the name change by the State in which 
incorporated, and a copy of the appropriate resolution, order, or other 
document showing the name change.

In all these cases, the BLM would use the information for monitoring 
and inspection purposes, and to maintain current data on rights-of-way.
7. Plan of Development for Solar Energy Development Lease Inside 
Designated Leasing Area and Plan of Development for Wind Energy 
Development Lease Inside Designated Leasing Area
    Proposed section 2809.18(c) would require the holder of a wind or 
solar energy development lease for lands inside a designated leasing 
area to submit a Plan of Development within two years of the lease 
issuance date that addresses all pre-development and development 
activities. This collection activity is necessary to ensure diligent 
development.
    This new provision would be a new use of Item # 7 of SF-
299, which calls for the following information:

    Project description (describe in detail): (a) Type of system or 
facility (e.g., canal, pipeline, road); (b) related structures and 
facilities; (c) physical specifications (length, width, grading, 
etc.); (d) term of years needed; (e) time of year of use or 
operation; (f) volume or amount of product to be transported; (g) 
duration and timing of construction; and (h) temporary work areas 
needed for construction.

This collection has been justified and authorized under 0596-0082. In 
addition, proposed section 2809.18(c) would provide that the minimum 
requirements for a ``Wind Energy Plan of Development'' or ``Solar 
Energy Plan of Development'' can be found at a link to a template at 
www.blm.gov. To some extent, that template duplicates the information 
required by Item # 7 of SF-299. The following requirements do 
not duplicate the elements listed in SF-299:

[[Page 59061]]

     Operations and maintenance. This information will assist 
the BLM in verifying the right-of-way holder's compliance with terms 
and conditions regarding all aspects of operations and maintenance, 
including road maintenance and workplace safety;
     Environmental considerations. This information will assist 
the BLM in monitoring compliance with terms and conditions regarding 
mitigation measures and site-specific issues such as protection of 
sensitive species and avoidance of conflicts with recreation uses of 
nearby lands;
     Maps and drawings. This information will assist the BLM in 
monitoring compliance with all terms and conditions; and
     Supplementary information. This information, which will be 
required after submission of the holder's initial Plan of Development, 
will assist the BLM in reviewing possible alternative designs and 
mitigation measures for a final Plan of Development.
8. General Description of Proposed Oil or Gas Pipeline 10 inches or 
More in Diameter and Schedule for Submittal of Plan of Development
    Section 2884.10(d)(3) would list conditions for BLM acceptance of 
an application for an oil or gas pipeline 10 inches or more in 
diameter. One of these conditions would be the submission of a general 
description of the proposed project and a schedule for submitting a 
Plan of Development. The BLM would use the information to assist in its 
decision whether or not to process an application for a large-scale 
right-of-way of this type.
9. Request for Amendment, Assignment, or Name Change (MLA)
    Proposed sections 2886.12 and 2887.11 would pertain to holders of 
MLA rights-of-way and temporary use permits. A temporary use permit 
authorizes a holder of an MLA right-of-way to use land temporarily in 
order to construct, operate, maintain, or terminate a pipeline, or for 
purposes of environmental protection or public safety. See 43 CFR 
2881.12. The proposed regulations would require these holders to 
contact the BLM:
     Before engaging in any activity that is a ``substantial 
deviation'' from what is authorized;
     Whenever site-specific circumstances or conditions arise 
that result in the need for changes that are not substantial 
deviations;
     When the holder submits a certification of construction;
     Before assigning, in whole or in part, any right or 
interest in a grant or lease; and
     Before changing the name of a holder (i.e., when the name 
change is not the result of an underlying change in control of the 
right-of-way).
    A request for an amendment of a right-of-way or temporary use 
permit would be required in cases of a substantial deviation (for 
example, a change in the boundaries of the right-of-way, major 
improvements not previously approved by the BLM, or a change in the use 
of the right-of-way). Other changes, such as changes in project 
materials, or changes in mitigation measures within the existing, 
approved right-of-way area, would be required to be submitted to the 
BLM for review and approval. In order to assign a grant, the proposed 
assignee must file an assignment application and follow the same 
procedures and standards as for a new grant or lease, as well as pay 
processing fees. In order to request a name change, the holder would be 
required to file an application and follow the same procedures and 
standards as for a new grant or lease and pay processing fees, but no 
application fee would be required. The following documents are also 
required in the case of a name change:
     A copy of the court order or legal document effectuating 
the name change of an individual; or
     If the name change is for a corporation, a copy of the 
corporate resolution proposing and approving the name change, a copy of 
a document showing acceptance of the name change by the State in which 
incorporated, and a copy of the appropriate resolution, order, or other 
document showing the name change.

In all these cases, the BLM would use the information for monitoring 
and inspection purposes, and to maintain current data on rights-of-way.
10. Certification of Construction
    A certification of construction is a document a holder of an MLA 
right-of-way must submit to the BLM after finishing construction of a 
facility, but before operations begin. The BLM will use the information 
to verify that the holder has constructed and tested the facility to 
ensure that it complies with the terms of the right-of-way and is in 
accordance with applicable Federal and State laws and regulations.

Summary of Information Collection Requirements Met by Existing SF-299

    All of the respondents that would be subject to the proposed rule, 
and that would be required to use SF-299, would be required to provide 
information about their identity (Item Numbers 1 through 6, as 
applicable). The following table shows additional ways respondents 
would use SF-299 as currently approved under control number 0596-0082.

       Information Collection Requirements Met by Existing SF-299
------------------------------------------------------------------------
                                                  Key portions of SF-299
                                    Number of         to be used by
        Type of response            responses        respondents, as
                                                        applicable
------------------------------------------------------------------------
A.                                           B.  C.
------------------------------------------------------------------------
General description of proposed              20  Project description
 project and schedule for                         (Item 7); Other data
 submittal of Plan of                             on the nature and
 Development 43 CFR                               location of the
 2804.10(c)(4).                                   proposed project
                                                  (Items 8, 11, 13, and
                                                  15); Technical and
                                                  financial capability
                                                  (Item 12); Other
                                                  governmental approvals
                                                  (Items 9, 14, and 20);
                                                  and Probable effects
                                                  (Items 17 through 19).
Application for wind energy                  40  Project description
 testing grant, 43 CFR                            (Item 7); Other data
 2804.12(a)(8), 2804.30(g),                       on the nature and
 2805.11(b)(2)(i),                                location of the
 2805.11(b)(2)(ii), and                           proposed project
 2809.19(c).                                      (Items 8, 11, 13, and
                                                  15); Technical and
                                                  financial capability
                                                  (Item 12); Other
                                                  governmental approvals
                                                  (Items 9, 14, and 20);
                                                  and Probable effects
                                                  (Items 17 through 19).
Application for other short                   1  Project description
 term grant related to solar or                   (Item 7); Other data
 wind energy, 43 CFR 2804.14                      on the nature and
 and 2805.11(b)(2)(iii).                          location of the
                                                  proposed project
                                                  (Items 8, 11, 13, and
                                                  15); Technical and
                                                  financial capability
                                                  (Item 12); Other
                                                  governmental approvals
                                                  (Items 9, 14, and 20);
                                                  and Probable effects
                                                  (Items 17 through 19).

[[Page 59062]]

 
Application for, or request to               11  Project description
 assign, solar or wind energy                     (Item 7); Other data
 development right-of-way, 43                     on the nature and
 CFR 2804.12(a)(8), 2804.30(g),                   location of the
 and 2807.21.                                     proposed project
                                                  (Items 8, 11, 13, and
                                                  15); Technical and
                                                  financial capability
                                                  (Item 12); Other
                                                  governmental approvals
                                                  (Items 9, 14, and 20);
                                                  and Probable effects
                                                  (Items 17 through 19).
Application for renewal of wind               6  Project description
 energy project area testing                      (Item 7); Other data
 grant or other short term                        on the nature and
 grant, 43 CFR 2804.14,                           location of the
 2805.11(b)(2)(ii), and                           proposed project
 2805.14(h).                                      (Items 8, 11, 13, and
                                                  15); Technical and
                                                  financial capability
                                                  (Item 12); Other
                                                  governmental approvals
                                                  (Items 9, 14, and 20);
                                                  and Probable effects
                                                  (Items 17 through 19).
Environmental, technical, and                20  Project description
 financial records, reports,                      (Item 7); Nature and
 and other information, 43 CFR                    location of the
 2805.12(a)(15).                                  project (Items 7, 8,
                                                  11, 13, and 15);
                                                  Technical and
                                                  financial capability
                                                  (Item 12); Other
                                                  governmental approvals
                                                  (Items 9, 14, and 20);
                                                  and Probable effects
                                                  (Items 17 through 19).
Application for renewal of                    1  Project description
 solar or wind energy                             (Item 7); Other data
 development grant or lease, 43                   on the nature and
 CFR 2805.14(g) and 2807.22.                      location of the
                                                  proposed project
                                                  (Items 8, 11, 13, and
                                                  15); Technical and
                                                  financial capability
                                                  (Item 12); Other
                                                  governmental approvals
                                                  (Items 9, 14, and 20);
                                                  and Probable effects
                                                  (Items 17 through 19).
Request for amendment or name                30  Project description
 change (FLPMA), 43 CFR                           (Item 7); and Other
 2807.11(b) and (d) and 2807.21.                  data on the nature and
                                                  location of the
                                                  proposed project
                                                  (Items 8, 11, 13, and
                                                  15).
Plan of Development for solar                 1  Project description
 energy development lease                         (Item 7); and Other
 inside designated leasing                        data on the nature and
 area, 43 CFR 2809.18(c).                         location of the
                                                  proposed project
                                                  (Items 8, 11, 13, and
                                                  15).
Plan of Development for wind                  1  Project description
 energy development lease                         (Item 7); and Other
 inside designated leasing                        data on the nature and
 area, 43 CFR 2809.18(c).                         location of the
                                                  proposed project
                                                  (Items 8, 11, 13, and
                                                  15).
General description of proposed             105  Project description
 oil or gas pipeline 10 inches                    (Item 7); Other data
 or more in diameter and                          on the nature and
 schedule for submittal of Plan                   location of the
 of Development, 43 CFR                           proposed project
 2884.10(d)(3).                                   (Items 8, 11, 13, and
                                                  15); Technical and
                                                  financial capability
                                                  (Item 12); Other
                                                  governmental approvals
                                                  (Items 9, 14, and 20);
                                                  and Probable effects
                                                  (Items 17 through 19).
Request for amendment,                    2,862  Project description
 assignment, or name change                       (Item 7); and Other
 (MLA), 43 CFR 2886.12(b) and                     data on the nature and
 (d) and 43 CFR 2887.11.                          location of the
                                                  proposed project
                                                  (Items 8, 11, 13, and
                                                  15).
Certification of construction,                5  Project description
 43 CFR 2886.12(f).                               (Item 7); and Other
                                                  data on the nature and
                                                  location of the
                                                  proposed project
                                                  (Items 8, 11, 13, and
                                                  15).
                                ----------------
    Totals.....................           3,103  .......................
------------------------------------------------------------------------

    The estimated hour burdens of the proposed supplemental collection 
requirements are shown in the following table.

       Proposed Information Collection Requirements Supplemental to SF-299: Estimated Annual Hour Burdens
----------------------------------------------------------------------------------------------------------------
                                                                                                    Total hours
                        Type of response                             Number of       Hours per      (column B x
                                                                     responses       response        column C)
----------------------------------------------------------------------------------------------------------------
A.                                                                            B.              C.              D.
----------------------------------------------------------------------------------------------------------------
General description of proposed project and schedule for                      20               2              40
 submittal of Plan of Development, 43 CFR 2804.10(c)(4).........
Application for wind energy testing grant, 43 CFR 2804.12(a)(8),              40               8             320
 2804.30(g), 2805.11(b)(2)(i), 2805.11(b)(2)(ii), and 2809.19(c)
Application for other short term grant associated with solar or                1               8               8
 wind energy, 43 CFR 2804.14 and 2805.11(b)(2)(iii).............
Application for, or request to assign, solar or wind energy                   11              12             132
 development right-of-way, 43 CFR 2804.12(a)(8), 2804.30(g), and
 2807.21........................................................
Application for renewal of wind energy project area testing                    6               6              36
 grant or other short term grant, 43 CFR 2804.14,
 2805.11(b)(2)(ii), and 2805.14(h)..............................
Environmental, technical, and financial records, reports, and                 20               4              80
 other information, 43 CFR 2805.12(a)(15).......................
Application for renewal of solar or wind energy development                    1              12              12
 grant or lease, 43 CFR 2805.14(g) and 2807.22..................
Request for amendment or name change (FLPMA), 43 CFR 2807.11(b)               30              16             480
 and (d) and 2807.21............................................
Plan of Development for solar energy development lease inside                  1               8               8
 designated leasing area, 43 CFR 2809.18(c).....................

[[Page 59063]]

 
Plan of Development for wind energy development lease inside                   1               8               8
 designated leasing area, 43 CFR 2809.18(c).....................
General description of proposed oil or gas pipeline 10 inches or             105               2             210
 more in diameter and schedule for submittal of Plan of
 Development, 43 CFR 2884.10(d)(3)..............................
Request for amendment, assignment, or name change (MLA), 43 CFR            2,862              16          45,792
 2886.12(b) and (d) and 43 CFR 2887.11..........................
Certification of construction, 43 CFR 2886.12(f)................               5               4              20
                                                                 -----------------------------------------------
    Totals......................................................           3,103  ..............          47,146
----------------------------------------------------------------------------------------------------------------

    Some of these proposed information collection activities would 
include fees to reimburse the United States for administrative costs. 
These fees would be collected under the authority of 43 U.S.C. 1734, 
which authorizes the Secretary of the Interior to establish reasonable 
filing and service fees ``with respect to applications and other 
documents relating to the public lands.''
    Other information collection requirements in the proposed rule 
would include fees to discourage speculation by use of frivolous right-
of-way applications for solar or wind energy. The amounts of these fees 
are not intended for cost recovery.
    These fees (i.e., non-hour burdens) are itemized in the following 
table.

     Proposed Information Collection Requirements Supplemental to SF-299: Estimated Annual Non-Hour Burdens
----------------------------------------------------------------------------------------------------------------
                                                                                                    Total fees
         Type of response              Number of      Amount of fee per        Purpose of fee       (column B x
                                       responses           response                                  column C)
----------------------------------------------------------------------------------------------------------------
A.                                              B.  C....................  D....................              E.
----------------------------------------------------------------------------------------------------------------
Application for wind energy                     40  $2 per acre x average  Discourage                   $480,000
 testing grant, 43 CFR                               of 6,000 acres per     speculation.
 2804.12(a)(8), 2804.30(g),                          application =
 2805.11(b)(2)(i),                                   $12,000.
 2805.11(b)(2)(ii), and 2809.19(c).
Application for other short term                 1  $1,124 \1\...........  Cost recovery........           1,124
 grant related to solar or wind
 energy 43 CFR 2804.14 and
 2805.11(b)(2)(iii).
Application for, or request to                  11  $15 per acre x         Discourage                    990,000
 assign, solar or wind energy                        average of 6,000       speculation.
 development right-of-way 43 CFR                     acres per
 2804.12(a)(8), 2804.30(g), and                      application =
 2807.21.                                            $90,000.
Application for renewal of wind                  6  $1,124 \2\...........  Cost recovery........           6,744
 energy project area testing grant
 or other short term grant 43 CFR
 2804.14, 2805.11(b)(2)(ii),
 2805.11(b)(2)(iii), and
 2805.14(h).
Application for renewal of solar                 1  $1,124 \3\...........  Cost recovery........           1,124
 or wind energy development grant
 or lease 43 CFR 2805.14(g) and
 2807.22.
                                   ----------------                                              ---------------
    Totals........................              59  .....................  .....................       1,478,992
----------------------------------------------------------------------------------------------------------------
\1\ This estimate is based on the BLM's experience. The amount shown is for Processing Category Four for
  calendar year 2014, in accordance with 43 CFR 2804.14.
\2\ This estimate is based on the BLM's experience. The amount shown is for Processing Category Four for
  calendar year 2014, in accordance with 43 CFR 2804.14.
\3\ This estimate is based on the BLM's experience. The amount shown is for Processing Category Four for
  calendar year 2014, in accordance with 43 CFR 2804.14.

Summary of Other Proposed Information Collection Requirements

1. Pre-Application Information for Large-Scale Rights-of-Way
    In accordance with proposed 43 CFR 2804.10, anyone interested in a 
right-of-way for a large-scale project (i.e., for solar or wind energy, 
for a transmission line with a capacity of 100 kV or more, or for any 
pipeline 10 inches or more in diameter) would be required to hold pre-
application meetings. Among other things, these meetings would be 
opportunities for the proponent of a project to provide information to 
the BLM, other governmental entities, and various stakeholders. The 
potential applicant would be required to pay reasonable costs 
associated with the pre-application requirements, with the option of 
paying the-actual costs. The information would assist the BLM in 
protecting public lands and in facilitating application processing for 
these types of authorizations, which are generally larger and more 
complex than the average right-of-way authorization.

[[Page 59064]]

2. Showing of Good Cause
    Any right-of-way for solar and wind energy requires due diligence 
in development. In accordance with proposed 43 CFR 2805.12(c)(6), the 
BLM would notify the holder before suspending or terminating the right-
of-way for lack of due diligence. This notice would provide the holder 
with a reasonable opportunity to correct any noncompliance or to start 
or resume use of the right-of-way. A showing of good cause would be 
required in response. That showing would have to include:
     Reasonable justification for any delays in construction 
(for example, delays in equipment delivery, legal challenges, and acts 
of God);
     The anticipated date of completion of construction and 
evidence of progress toward the start or resumption of construction; 
and
     A request for extension of the timelines in the approved 
POD.

The BLM would use the information to determine whether or not to 
suspend or terminate the right-of-way for failure to comply with due 
diligence requirements.
3. Reclamation Cost Estimate for Lands Outside Designated Leasing Area
    The proposed rule provides that a bond would be required for each 
solar and wind energy development outside a designated leasing area. In 
accordance with proposed section 2305.20(a)(3), the bond amount would 
be based on the holder's estimate of the costs for reclaiming and 
restoring the public lands, include the administrative costs for the 
BLM to administer a contract to reclaim and restore the lands in the 
authorization. The BLM would use the reclamation cost estimate to 
determine the appropriate bond amount.
4. Nomination of Parcel of Land Inside Designated Leasing Area
    Under proposed section 2809.10, the BLM could: (1) On its own 
initiative offer lands competitively inside designated leasing areas 
for solar or wind energy development, or (2) solicit nominations for 
such development. Proposed section 2809.11 would describe the 
nomination process.
    In order to nominate a parcel under this process, the nominator 
would be required to be qualified to hold a right-of-way under 43 CFR 
2803.10. After publication of a notice by the BLM, anyone meeting the 
qualifications could submit a nomination for a specific parcel of land 
to be developed for solar or wind energy. There would be a fee of $5 
per acre for each nomination. The following information would be 
required:
     The nominator's name and personal or business address; and
     The legal land description; and
     A map of the nominated lands.

The BLM would use the information to communicate with the nominator and 
to determine whether or not to proceed with a competitive offer.
5. Expression of Interest in Parcel of Land Inside Designated Leasing 
Area
    Proposed section 2809.11 would provide that the BLM may consider 
informal expressions of interest suggesting lands to be included in a 
competitive offer. The expression would have to include a description 
of the suggested lands and a rationale for their inclusion in a 
competitive offer. The information would assist the BLM in determining 
whether or not to proceed with a competitive offer.
    The estimated hour and non-hour burdens of these proposed 
collection activities are shown in the following tables.

                Other Proposed Information Collection Requirements: Estimated Annual Hour Burdens
----------------------------------------------------------------------------------------------------------------
                                                                                    Total hours     Annual cost
                Type of response                     Number of       Hours per      (column B x     (column D x
                                                     responses       response        column C)        $61.22)
----------------------------------------------------------------------------------------------------------------
A.                                                            B.              C.              D.              E.
----------------------------------------------------------------------------------------------------------------
Pre-application information for large-scale                   20               2              40          $2,449
 rights-of-way, 43 CFR 2804.10(a)(4) and (b)....
Showing of good cause, 43 CFR 2805.12(c)(6).....               1               2               2             122
Reclamation cost estimate for lands outside                    1              10              10             612
 designated leasing area, 43 CFR 2805.20(a)(3)..
Nomination of parcel of land inside designated                 1               4               4             245
 leasing area, 43 CFR 2809.11...................
Expression of interest in parcel of land inside                1               4               4             245
 designated leasing area, 43 CFR 2809.11........
                                                 ---------------------------------------------------------------
    Totals......................................              24  ..............              60           3,673
----------------------------------------------------------------------------------------------------------------

    In connection with the submission of pre-application information, 
the proposed rule would require a cost recovery fee to reimburse the 
United States for administrative costs. This fee would be collected 
under the authority of 43 U.S.C. 1734, which authorizes the Secretary 
of the Interior to establish reasonable filing and service fees ``with 
respect to applications and other documents relating to the public 
lands.''
    In connection with the nomination of a parcel inside a designated 
leasing area, the proposed rule would require a fee set at an amount to 
discourage speculation by use of a frivolous nomination. The amount of 
this fee is not intended for cost recovery.

[[Page 59065]]



              Other Proposed Information Collection Requirements: Estimated Annual Non-Hour Burdens
----------------------------------------------------------------------------------------------------------------
                                                                                                    Total fees
         Type of response              Number of      Amount of fee per        Purpose of fee       (column B x
                                       responses           response                                  column C)
----------------------------------------------------------------------------------------------------------------
A.                                              B.  C....................  D....................              E.
----------------------------------------------------------------------------------------------------------------
Pre-application information for                 20  $5,000...............  Cost recovery........        $100,000
 large-scale rights-of-way 43 CFR
 2804.10(a)(4) and (b).
Nomination of parcel of land                     1  $5 per acre x average  Discourage                    $30,000
 inside designated leasing area 43                   of 6,000 acres per     speculation.
 CFR 2809.11.                                        nomination = $30,000.
                                   ----------------                       --------------------------------------
    Totals........................              21  .....................  .....................        $130,000
----------------------------------------------------------------------------------------------------------------

Author

    The principal author of this rule is Jayme Lopez, Realty Specialist 
of the National Renewable Energy Coordination Office Washington Office, 
Bureau of Land Management, Department of the Interior. He was assisted 
by Jean Sonneman and Charles Yudson of the Division of Regulatory 
Affairs, Washington Office, Bureau of Land Management, Department of 
the Interior.

List of Subjects

43 CFR Part 2800

    Communications, Electric power, Highways and roads, Penalties, 
Public lands and rights-of-way, Reporting and recordkeeping 
requirements.

43 CFR Part 2880

    Administrative practice and procedures, Common carriers, Pipelines, 
Federal lands and rights-of-way, Reporting and recordkeeping 
requirements.

    Accordingly, for the reasons stated in the preamble, the BLM 
proposes to amend 43 CFR parts 2800 and 2880 as set forth below:

PART 2800--RIGHTS-OF-WAY UNDER THE FEDERAL LAND POLICY AND 
MANAGEMENT ACT

0
1. Revise the heading of Part 2800 to read as set forth above.
0
2. The authority citation for part 2800 continues to read as follows:

    Authority: 43 U.S.C. 1733, 1740, 1763, and 1764.

Subpart 2801--General Information

0
3. Amend Sec.  2801.5(b) by:
0
a. Adding, in alphabetical order, definitions of ``Acreage rent,'' 
``Application filing fee,'' ``Assignment,'' ``Designated leasing 
area,'' ``Megawatt (MW) capacity fee,'' ``Megawatt rate,'' 
``Performance and reclamation bond,'' ``Reclamation cost estimate,'' 
``Screening criteria for solar and wind energy development,'' and 
``Short-term right-of-way grant;'' and
0
b. Revising the definitions of ``Designated right-of-way corridor,'' 
``Management overhead costs,'' and ``Right-of-way.''
    The additions and revisions read as follows:


Sec.  2801.5  What acronyms and terms are used in the regulations in 
this part?

* * * * *
    Acreage rent means rent assessed for solar and wind energy 
development grants and leases that is determined by the number of acres 
authorized for the grant or lease.
* * * * *
    Application filing fee means a filing fee specific to solar and 
wind energy applications.
    Assignment means the transfer, in whole or in part, of any right or 
interest in a right-of-way grant or lease from the holder (assignor) to 
a subsequent party (assignee) with the BLM's written approval. A change 
in ownership of the grant or lease, or other related change-in-control 
transaction involving the holder, including a merger or acquisition, 
also constitutes an assignment for purposes of these regulations 
requiring the BLM's written approval, unless applicable statutory 
authority provides otherwise.
* * * * *
    Designated leasing area means a parcel of land with specific 
boundaries identified by the BLM land use planning process as being a 
preferred location for solar or wind energy development that must be 
leased competitively. Solar energy zones are an example of a designated 
leasing area for solar energy.
    Designated right-of-way corridor means a parcel of land with 
specific boundaries identified by law, Secretarial order, the land-use 
planning process, or other management decision, as being a preferred 
location for existing and future linear rights-of-way and facilities. 
The corridor may be suitable to accommodate more than one right-of-way 
use or facility, provided that they are compatible with one another and 
the corridor designation.
* * * * *
    Management overhead costs means Federal expenditures associated 
with a particular Federal agency's directorate. The BLM's directorate 
includes all State Directors and the entire Washington Office staff, 
except where a State Director or Washington Office staff member is 
required to perform work on a specific right-of-way case.
    Megawatt (MW) capacity fee means the fee paid in addition to the 
acreage rent, for solar and wind energy development grants and leases. 
The MW capacity fee is the approved MW capacity of the solar or wind 
energy grant or lease multiplied by the appropriate MW rate. A grant or 
lease may provide for stages of development and will be charged a fee 
for each stage by multiplying the MW rate to the approved stage of the 
project.
    Megawatt rate means the price of each MW of capacity for various 
solar and wind energy technologies as determined by the MW rate 
formula. Current MW rates are found on the BLM's MW Rate Schedule which 
can be obtained at any BLM office or at http://www.blm.gov. The MW rate 
is calculated by multiplying the total hours per year by the net 
capacity factor, by the MW hour (MWh) price, and by the rate of return, 
where:
    (1) ``Net capacity factor'' means the average operational time 
divided by the average potential operational time of a solar or wind 
energy development, multiplied by the current technology efficiency 
rates. The net capacity factor for each technology type is:
    (i) Photovoltaic (PV)--20 percent;
    (ii) Concentrated photovoltaic (CPV) and concentrated solar power 
(CSP)--25 percent;
    (iii) CSP with storage capacity of 3 hours or more--30 percent; and

[[Page 59066]]

    (iv) Wind energy--35 percent;
    (2) ``Megawatt hour (MWh) price'' means the 5-year average of the 
annual weighted average wholesale prices per MWh for the major 
Intercontinental Exchange (ICE) (see https://beta.theice.com/marketdata/reports/ReportCenter.shtml), or its successor in interest, 
at trading hubs serving the 11 western States of the continental United 
States (U.S.);
    (3) ``Rate of return'' means the relationship of income (to the 
property owner) to revenue generated from authorized solar and wind 
energy development facilities based on the 10-year average of the 20-
year U.S. Treasury bond yield rounded up to the nearest one-half 
percent; and
    (4) ``Hours per year'' means the total number of hours in a year, 
which, for purposes of this part, means 8,760 hours.
* * * * *
    Performance and reclamation bond means the document provided by the 
holder of a right-of-way grant or lease that provides the appropriate 
financial guarantees, including cash, to cover potential liabilities or 
specific requirements identified by the BLM for the construction, 
operation, decommissioning, and reclamation of an authorized right-of-
way on public land.
    (1) Acceptable bond instruments include cash, cashier's or 
certified check, certificate or book entry deposits, negotiable U.S. 
Treasury securities, and surety bonds from the approved list of 
sureties (U.S. Treasury Circular 570) payable to the BLM. Irrevocable 
letters of credit payable to the BLM and issued by banks or financial 
institutions organized or authorized to transact business in the United 
States are also acceptable bond instruments. Insurance policies can 
also qualify as acceptable bond instruments, provided that the BLM 
determines that the insurance policies will guarantee performance of 
financial obligations and are issued by insurance carriers that have 
the authority to issue insurance policies in the applicable 
jurisdiction and whose insurance operations are organized or authorized 
to transact business in the U.S.
    (2) Unacceptable bond instruments. The BLM will not accept a 
corporate guarantee as an acceptable form of bond instrument.
* * * * *
    Reclamation cost estimate (RCE) means the estimate of costs to 
restore the land to a condition that will support pre-disturbance land 
uses. This includes the cost to remove all improvements made under the 
right-of-way authorization, return the land to approximate original 
contour, and establish a sustainable vegetative community. The RCE will 
be used to establish the appropriate amount for financial guarantees of 
land uses on the public lands, including those uses authorized by 
right-of-way grants or leases issued under this part.
* * * * *
    Right-of-way means the public lands that the BLM authorizes a 
holder to use or occupy under a particular grant or lease.
* * * * *
    Screening criteria for solar and wind energy development refers to 
the policies and procedures that the BLM uses to prioritize how it 
processes solar and wind energy development right-of-way applications 
in order to facilitate the environmentally responsible development of 
such facilities through the consideration of resource conflicts, land 
use plans, and applicable statutory and regulatory requirements. 
Applications with lesser resource conflicts are anticipated to be less 
costly and time-consuming for the BLM to process and will be 
prioritized over those with greater resource conflicts.
    Short-term right-of-way grant means any grant issued for a term of 
3 years or less for such uses as storage sites, construction areas, and 
site testing and monitoring activities, including site characterization 
studies and environmental monitoring.
* * * * *
0
4. In Sec.  2801.6, revise paragraph (a)(2) to read as follows:


Sec.  2801.6  Scope.

    (a) * * *
    (2) Grants to Federal departments or agencies for all systems and 
facilities identified in Sec.  2801.9(a), including grants for 
transporting by pipeline and related facilities, commodities such as 
oil, natural gas, synthetic liquid or gaseous fuels, and any refined 
products produced from them; and
* * * * *
0
5. Amend Sec.  2801.9 by revising paragraphs (a)(4) and (a)(7), and by 
adding paragraph (d) to read as follows:


Sec.  2801.9  When do I need a grant?

    (a) * * *
    (4) Systems for generating, transmitting, and distributing 
electricity, including solar and wind energy development facilities and 
associated short-term actions such as site and geotechnical testing for 
solar and wind energy projects;
* * * * *
    (7) Such other necessary transportation or other systems or 
facilities including any temporary or short-term surface disturbing 
activities associated with approved systems or facilities and which are 
in the public interest and which require rights-of-way.
* * * * *
    (d) All systems, facilities, and related activities for solar and 
wind energy projects are specifically authorized as follows:
    (1) Wind energy site specific testing activities, including those 
with individual meteorological towers and instrumentation facilities, 
are authorized with a short-term right-of-way grant issued for 3 years 
or less;
    (2) Wind energy project area testing activities are authorized with 
a short-term right-of-way grant for an initial term of 3 years or less 
with the option to renew for one additional 3-year period under Sec.  
2805.14(h) when the renewal application is accompanied by a wind energy 
development application;
    (3) Other associated actions not specifically included in Sec.  
2801.9(d)(1) and (2), such as geotechnical testing and other temporary 
land disturbing activities, are authorized with a short-term right-of-
way grant issued for 3 years or less;
    (4) Solar and wind energy development facilities located outside 
designated leasing areas, except as provided for by Sec.  
2809.17(d)(2), are authorized with a right-of-way grant issued for up 
to 30 years (plus the initial partial year of issuance). An application 
for renewal of the grant may be submitted under Sec.  2805.14(g); and
    (5) Solar and wind energy development facilities located inside 
designated leasing areas are authorized with a solar or wind energy 
development lease when issued competitively under subpart 2809. The 
term is fixed for 30 years (plus the initial partial year of issuance). 
An application for renewal of the lease may be submitted under Sec.  
2805.14(g).

Subpart 2802--Lands Available for FLPMA Grants

0
6. In Sec.  2802.11, revise the section heading and paragraph (a), 
revise the introductory language of paragraph (b), and revise 
paragraphs (b)(3), (b)(4), (b)(6), (b)(7), and (d) to read as follows:


Sec.  2802.11  How does the BLM designate right-of-way corridors and 
designated leasing areas?

    (a) The BLM may determine the locations and boundaries of right-of-
way corridors or designated leasing areas during the land use planning 
process described in part 1600 of this chapter.

[[Page 59067]]

During this process, the BLM coordinates with other Federal agencies, 
State, local, and tribal governments, and the public to identify 
resource-related issues, concerns, and needs. The process results in a 
resource management plan or plan amendment, which addresses the extent 
to which you may use public lands and resources for specific purposes.
    (b) When determining which lands may be suitable for right-of-way 
corridors or designated leasing areas, the factors the BLM considers 
include, but are not limited to, the following:
* * * * *
    (3) Physical effects and constraints on corridor placement or 
leasing areas due to geology, hydrology, meteorology, soil, or land 
forms;
    (4) Costs of construction, operation, and maintenance and costs of 
modifying or relocating existing facilities in a proposed right-of-way 
corridor or designated leasing area (i.e., the economic efficiency of 
placing a right-of-way within a proposed corridor or providing a lease 
inside a designated leasing area);
* * * * *
    (6) Potential health and safety hazards imposed on the public by 
facilities or activities located within the proposed right-of-way 
corridor or designated leasing area;
    (7) Social and economic impacts of the right-of-way corridor or 
designated leasing area on public land users, adjacent landowners, and 
other groups or individuals;
* * * * *
    (d) The resource management plan or plan amendment may also 
identify areas where the BLM will not allow right-of-way corridors or 
designated leasing areas for environmental, safety, or other reasons.

Subpart 2804--Applying for FLPMA Grants

0
7. Amend Sec.  2804.10 by:
0
a. Revising the introductory text of paragraph (a), and revising 
paragraphs (a)(2) and (a)(4);
0
b. Redesignating paragraph (b) as paragraph (d);
0
c. Adding paragraphs (b) and (c); and
0
d. Revising newly redesignated paragraph (d).
    The revisions and additions read as follows:


Sec.  2804.10  What should I do before I file my application?

    (a) Except as provided in paragraph (b) of this section, we 
encourage you to make an appointment for a pre-application meeting with 
the appropriate personnel in the BLM office having jurisdiction over 
the lands you seek to use. During the pre-application meeting, the BLM 
may:
* * * * *
    (2) Determine whether the lands are located inside a designated or 
existing right-of-way corridor or a designated leasing area;
* * * * *
    (4) Inform you of your financial obligations, such as processing 
and monitoring costs and rents. In addition to such costs, you are 
required to pay reasonable costs, and may elect to pay the actual 
costs, that are associated with the pre-application requirements 
identified in paragraph (b) of this section.
    (b) Before submitting an application for any solar energy or wind 
energy project, for any transmission line with a capacity of 100 kV or 
more, or for any pipeline 10 inches or more in diameter, you must do 
all of the following:
    (1) Schedule and hold an initial pre-application meeting with the 
BLM to discuss:
    (i) The general project proposal;
    (ii) The status of BLM land use planning for the lands involved;
    (iii) Potential siting issues or concerns;
    (iv) Potential environmental issues or concerns;
    (v) Potential alternative site locations; and
    (vi) The right-of-way application process.
    (2) Schedule and hold, in coordination with the BLM, one additional 
pre-application meeting with appropriate Federal and State agencies and 
tribal and local governments to facilitate coordination of potential 
environmental and siting issues and concerns. The BLM and you may agree 
mutually to schedule and hold additional pre-application meetings.
    (3) Initiate early discussions with any grazing permittees that may 
be affected by the proposed project in accordance with 43 CFR 4110.4-
2(b).
    (c) In addition to all other pre-application, application, and 
holder requirements specified in this part, the BLM will accept an 
application under this subpart for any solar energy or wind energy 
development project, for any transmission line with a capacity of 100 
kV or more, or any pipeline 10 inches or more in diameter, only if:
    (1) The written proposal addresses known potential resource 
conflicts with sensitive resources and values that are the basis for 
special designations or protections, and includes applicant-proposed 
measures to avoid, minimize, and mitigate such resource conflicts;
    (2) The proposal for solar energy or wind energy development is not 
sited on lands inside a designated leasing area, except as provided for 
by Sec.  2809.19;
    (3) The pre-application meetings described in Sec.  2804.10(b)(1) 
and (2) have been completed to the BLM's satisfaction; and
    (4) The proposal is accompanied by a general description of the 
proposed project and a schedule for the submittal of a plan of 
development (POD) conforming to the POD template at http://www.blm.gov.
    (d) Subject to Sec.  2804.13, BLM may share any information you 
provide under paragraph (a) of this section with Federal, State, 
tribal, and local government agencies to ensure that:
    (1) These agencies are aware of any authorizations you may need 
from them; and
    (2) We initiate effective coordinated planning as soon as possible.
0
8. In Sec.  2804.12:
0
a. Revise the second sentence of the introductory text of paragraph 
(a);
0
b. Remove each semicolon at the end of paragraphs (a)(1) through (a)(5) 
and add in each place a period;
0
c. At the end of paragraph (a)(6), remove the phrase ``; and'' and add 
in its place a period; and
0
d. Add new paragraphs (a)(8) and (a)(9).
    The revisions and additions read as follows:


Sec.  2804.12  What information must I submit in my application?

    (a) * * * Your completed application must include all of the 
following:
* * * * *
    (8) A nonrefundable application filing fee for solar and wind 
energy applications. The fee is $15 per acre for solar and wind energy 
development applications and $2 per acre for wind energy project area 
and site specific testing applications. The BLM will adjust the 
application filing fee at least once every 10 years by the average 
annual change in the Implicit Price Deflator, Gross Domestic Product 
(IPD-GDP) for the preceding 10-year period and round it to the nearest 
one-half dollar. This 10-year average will be adjusted at the same time 
as the Per Acre Rent Schedule for linear rights-of-way under Sec.  
2806.22.
    (9) A schedule for the submittal of a POD conforming to the POD 
template at http://www.blm.gov, should the BLM require you to submit a 
POD under Sec.  2804.25(b).
* * * * *
0
9. In Sec.  2804.14, revise paragraphs (a), (b), and (c) to read as 
follows:

[[Page 59068]]

Sec.  2804.14  What is the processing fee for a grant application?

    (a) Unless you are exempt under Sec.  2804.16, you must pay a fee 
to the BLM for the reasonable costs of processing your application. 
Subject to applicable laws and regulations, if processing your 
application involves Federal agencies other than the BLM, your fee may 
also include the reasonable costs estimated to be incurred by those 
Federal agencies. Instead of paying the BLM a fee for the reasonable 
costs incurred by other Federal agencies in processing your 
application, you may pay other Federal agencies directly for such 
costs. Reasonable costs are those costs as defined in Section 304(b) of 
FLPMA (43 U.S.C. 1734(b)). The fees for Processing Categories 1 through 
4 (see paragraph (b) of this section) are one-time fees and are not 
refundable. The fees are categorized based on an estimate of the amount 
of time that the Federal Government will expend to process your 
application and issue a decision granting or denying the application.
    (b) There is no processing fee if the Federal Government's work is 
estimated to take 1 hour or less. Processing fees are based on 
categories. The BLM will update the processing fees for Categories 1 
through 4 in the schedule each calendar year, based on the previous 
year's change in the IPD-GDP, as measured second quarter to second 
quarter rounded to the nearest dollar. The BLM will update Category 5 
processing fees as specified in the Master Agreement. These categories 
and the estimated range of Federal work hours for each category are:

                          Processing Categories
------------------------------------------------------------------------
            Processing category              Federal work hours involved
------------------------------------------------------------------------
(1) Applications for new grants,             Estimated Federal work
 assignments, renewals, and amendments to     hours are >1 <= 8.
 existing grants.
(2) Applications for new grants,             Estimated Federal work
 assignments, renewals, and amendments to     hours are > 8 <= 24.
 existing grants.
(3) Applications for new grants,             Estimated Federal work
 assignments, renewals, and amendments to     hours are > 24 <= 36.
 existing grants.
(4) Applications for new grants,             Estimated Federal work
 assignments, renewals, and amendments to     hours are > 36 <= 50.
 existing grants.
(5) Master agreements......................  Varies.
(6) Applications for new grants,             Estimated Federal work
 assignments, renewals, and amendments to     hours are > 50.
 existing grants.
------------------------------------------------------------------------

    (c) You may obtain a copy of the current year's processing fee 
schedule from any BLM state, district, or field office or by writing: 
U.S. Department of the Interior, Bureau of Land Management, 20 M 
Street, SE., Room 2134LM, Washington, DC 20003. The BLM also posts the 
current processing fee schedule at http://www.blm.gov.
* * * * *
0
10. Amend Sec.  2804.18 by redesignating paragraphs (a)(6) through 
(a)(8) as paragraphs (a)(7) through (a)(9) and adding new paragraph 
(a)(6). The addition reads as follows:


Sec.  2804.18  What provisions do Master Agreements contain and what 
are their limitations?

    (a) * * *
    (6) Describes existing agreements between the BLM and other Federal 
agencies for cost reimbursement;
* * * * *
0
11. Amend Sec.  2804.19 by revising paragraph (a) and adding new 
paragraph (e) to read as follows:


Sec.  2804.19  How will BLM process my Processing Category 6 
application?

    (a) For Processing Category 6 applications, you and the BLM must 
enter into a written agreement that describes how the BLM will process 
your application. The final agreement consists of a work plan, a 
financial plan, and a description of any existing agreements you have 
with other Federal agencies for cost reimbursement associated with your 
application.
* * * * *
    (e) We may collect reimbursement to the U.S. for reasonable costs 
for processing applications and other documents under this part 
relating to the public lands.
0
12. Amend Sec.  2804.20 by revising paragraphs (a)(1) and (a)(5), 
redesignating paragraph (a)(6) as paragraph (a)(8), and adding new 
paragraphs (a)(6) and (a)(7). The revisions and additions read as 
follows:


Sec.  2804.20  How does BLM determine reasonable costs for Processing 
Category 6 or Monitoring Category 6 applications?

* * * * *
    (a) * * *
    (1) Actual costs to the Federal Government (exclusive of management 
overhead costs) of processing your application and of monitoring 
construction, operation, maintenance, and termination of a facility 
authorized by the right-of-way grant;
* * * * *
    (5) Any tangible improvements, such as roads, trails, and 
recreation facilities, which provide significant public service and are 
expected in connection with constructing and operating the facility;
    (6) Existing agreements between the BLM and other Federal agencies 
for cost reimbursement associated with such application;
    (7) Costs associated with the pre-application requirements 
applicable to your project under Sec.  2804.10; and
* * * * *
0
13. Amend Sec.  2804.23 by revising the section heading and paragraphs 
(a)(1) and (c) and adding new paragraphs (d) and (e) to read as 
follows:


Sec.  2804.23  When will the BLM use a competitive process?

    (a) * * *
    (1) Processing Category 1 through 4. You must reimburse the Federal 
Government for processing costs as if the other application or 
applications had not been filed.
* * * * *
    (c) If we determine that competition exists, we will describe the 
procedures for a competitive bid through a bid announcement in a 
newspaper of general circulation in the area affected by the potential 
right-of-way and by a notice in the Federal Register. We may also 
provide notice by other methods, including the Internet. We may offer 
lands through a competitive process on our own initiative.
    (d) Competitive process for solar and wind energy development 
outside designated leasing areas. Lands outside designated leasing 
areas may be made available for solar and wind energy applications 
through a competitive

[[Page 59069]]

application process established by the BLM under Sec.  2804.30.
    (e) Competitive process for solar and wind energy development 
inside designated leasing areas. Lands inside designated leasing areas 
may be offered competitively under subpart 2809.
0
14. Amend Sec.  2804.24 by revising paragraph (a), redesignating 
paragraph (b) as paragraph (c), and adding new paragraph (b) to read as 
follows:


Sec.  2804.24  Do I always have to submit an application for a grant 
using Standard Form 299?

* * * * *
    (a) The BLM offers lands competitively under Sec.  2804.23(c) and 
you have already submitted an application for the facility or system;
    (b) The BLM offers lands for competitive lease under subpart 2809 
of this part; or
* * * * *
0
15. Amend Sec.  2804.25 by revising paragraphs (b) and (d) to read as 
follows:


Sec.  2804.25  How will BLM process my application?

* * * * *
    (b) The BLM may require you to submit additional information 
necessary to process the application. This information may include a 
detailed construction, operation, rehabilitation, and environmental 
protection plan (i.e., a POD), and any needed cultural resource surveys 
or inventories for threatened or endangered species. If the BLM needs 
more information, the BLM will identify this information in a written 
deficiency notice asking you to provide the additional information 
within a specified period of time. The BLM will notify you of any other 
grant applications which involve all or part of the lands for which you 
applied. The BLM will not process your application if you have any 
trespass action pending against you for any activity on BLM-
administered lands (see Sec.  2808.12) or have any unpaid debts owed to 
the Federal Government. Except as otherwise provided in this paragraph, 
the only applications the BLM would process to resolve the trespass 
would be for a right-of-way as authorized in this part, or a lease or 
permit under the regulations found at 43 CFR part 2920, but only after 
outstanding debts are paid.
* * * * *
    (d) In processing an application, the BLM will:
    (1) Hold public meetings if sufficient public interest exists to 
warrant their time and expense. The BLM will publish a notice in the 
Federal Register, a newspaper of general circulation in the vicinity of 
the lands involved in the area affected by the potential right-of-way, 
or use other notification methods including the Internet, to announce 
in advance any public hearings or meetings.
    (2) If your application is for solar or wind energy development:
    (i) Hold a public meeting in the area affected by the potential 
right-of-way;
    (ii) Apply screening criteria to prioritize processing applications 
with lesser resource conflicts priority over applications with greater 
resource conflicts, and categorize screened applications according to 
the criteria listed in Sec.  2804.35; and
    (iii) Evaluate the application based on the information provided by 
the applicant and the input of Federal, State, and local government 
agencies, tribes, and comments received in pre-application meetings 
held under Sec.  2804.10(b) and the public meeting held under Sec.  
2804.25(d)(2)(i). Based on this evaluation, the BLM will either deny 
your application or continue processing it.
    (3) Determine whether the POD schedule submitted with your 
application for solar or wind energy development, transmission line 
with a capacity of 100 kV or more, or pipeline 10 inches or more in 
diameter meets the development schedule and other requirements 
described in Sec. Sec.  2804.10(c)(4) and 2804.12(a)(9), or whether the 
applicant must supply additional information;
    (4) Complete a National Environmental Policy Act (NEPA) analysis 
for the application or approve a NEPA analysis previously completed for 
the application, as required by 40 CFR parts 1500 through 1508;
    (5) Determine whether your proposed use complies with applicable 
Federal and state laws;
    (6) If your application is for a road, determine whether it is in 
the public interest to require you to grant the U.S. an equivalent 
authorization across lands that you own;
    (7) Consult, as necessary, on a government to government basis with 
tribes and other governmental entities; and
    (8) Take any other action necessary to fully evaluate and decide 
whether to approve or deny your application.
* * * * *
0
16. Amend Sec.  2804.26 by revising paragraph (a)(5), redesignating 
paragraph (a)(6) as paragraph (a)(8), and adding new paragraphs (a)(6) 
and (a)(7). The revisions read as follows:


Sec.  2804.26  Under what circumstances may BLM deny my application?

    (a) * * *
    (5) You do not have or cannot demonstrate the technical or 
financial capability to construct the project or operate facilities 
within the right-of-way.
    (i) Applicants must have or be able to demonstrate technical and 
financial capability to construct, operate, maintain, and terminate a 
project throughout the application process and authorization period. 
You can demonstrate your financial and technical capability to 
construct, operate, maintain, and terminate a project by:
    (A) Documenting any previous successful experience in construction, 
operation, and maintenance of similar facilities on either public or 
non-public lands;
    (B) Providing information on the availability of sufficient 
capitalization to carry out development, including the preliminary 
study stage of the project and the environmental review and clearance 
process; or
    (C) Providing written copies of conditional commitments of Federal 
and other loan guarantees; confirmed power purchase agreements; 
engineering, procurement, and construction contracts; and supply 
contracts with credible third-party vendors for the manufacture or 
supply of key components for the project facilities.
    (ii) Failure to sustain technical and financial capability is 
grounds for denying the application or terminating the authorization;
    (6) The PODs required by Sec. Sec.  2804.10(c)(4) and 2804.12(a)(9) 
do not meet the development schedule or other requirements in the POD 
template and the applicant is unable to demonstrate why the POD should 
be approved;
    (7) The BLM's evaluation of your solar or wind application made 
under Sec.  2804.25(d)(2)(iii) provides a basis for a denial; or
* * * * *
0
17. In Sec.  2804.27, revise the introductory text to read as follows:


Sec.  2804.27  What fees do I owe if BLM denies my application or if I 
withdraw my application?

    If the BLM denies your application or you withdraw it, you must 
still pay any pre-application costs under Sec.  2804.10(a)(4), any 
application filing fees under Sec.  2804.12(a)(8), and any processing 
fee set forth at Sec.  2804.14, unless you have a Processing Category

[[Page 59070]]

5 or 6 application. Then, the following conditions apply:
* * * * *
0
18. Add Sec.  2804.30 to subpart 2804 to read as follows:


Sec.  2804.30  What is the competitive process for solar or wind energy 
development for lands outside of designated leasing areas?

    (a) Available land. The BLM may offer through a competitive process 
any land not inside a designated leasing area and open to right-of-way 
applications under Sec.  2802.10.
    (b) Variety of competitive procedures available. The BLM may use 
any type of competitive process or procedure to conduct its competitive 
offer and any method, including the use of the Internet, to conduct the 
actual auction or competitive bid procedure. Possible bid procedures 
could include, but are not limited to: Sealed bidding, oral auctions, 
modified competitive bidding, electronic bidding, or any combination 
thereof.
    (c) Competitive offer. The BLM may identify a parcel for 
competitive offer if competition exists or may include land in a 
competitive offer on its own initiative.
    (d) Notice of competitive offer. The BLM will publish a notice in a 
newspaper of general circulation in the area affected by the potential 
right-of-way, use other notification methods, including the Internet, 
and publish a notice in the Federal Register at least 30 days prior to 
the competitive offer. The notice would explain that the successful 
bidder would become the preferred applicant (see paragraph (g) of this 
section) and must apply for a grant. The newspaper and Federal Register 
notices must also include:
    (1) The date, time, and location, if any, of the competitive offer;
    (2) The legal land description of the parcel to be offered;
    (3) The bidding methodology and procedures to be used in conducting 
the competitive offer, which may include any of the competitive 
procedures identified in Sec.  2804.30(b);
    (4) The minimum bid required (see Sec.  2804.30(e)(2));
    (5) The qualification requirements of potential bidders (see Sec.  
2803.10); and
    (6) The requirements for the successful bidder to submit a schedule 
for the submittal of a POD for the lands involved in the competitive 
offer (see Sec.  2804.12(a)(9)).
    (e) Bidding--(1) Bid submissions. The BLM will accept your bid only 
if it includes payment for the minimum bid and at least 20 percent of 
the bonus bid.
    (2) Minimum bid. The minimum bid is not prorated among all bidders, 
but paid entirely by the successful bidder. The minimum bid consists 
of:
    (i) The administrative costs incurred by the BLM and other Federal 
agencies in preparing for and conducting the competitive offer, 
including required environmental reviews; and
    (ii) An amount determined by the authorizing officer and disclosed 
in the notice of competitive offer. This amount will be based on known 
or potential values of the parcel. In setting this amount, the BLM will 
consider factors that include, but are not limited to the acreage rent, 
megawatt capacity fee, and mitigation costs.
    (3) Bonus bid. The bonus bid consists of any dollar amount that a 
bidder wishes to bid in addition to the minimum bid.
    (4) If you are not the successful bidder, as defined in paragraph 
(f) of this section, the BLM will refund your bid.
    (f) Successful bidder. The successful bidder is determined by the 
highest total bid. If you are the successful bidder, you become the 
preferred applicant only if, within 15 calendar days after the day of 
the offer, you submit the balance of the bonus bid to the BLM office 
conducting the offer. You must make payments by personal check, 
cashier's check, certified check, bank draft, money order, or by other 
means deemed acceptable by the BLM, payable to the ``Department of the 
Interior--Bureau of Land Management.''
    (g) Preferred applicant. The preferred applicant is the only 
applicant that may apply for the parcel identified in the offer. The 
preferred applicant may apply for a wind energy project area testing 
grant, a wind energy site specific testing grant, or a solar or wind 
energy development grant. Grant approval is not guaranteed by winning 
the subject bid and is solely at the BLM's discretion.
    (h) Reservations. (1) The BLM may reject bids regardless of the 
amount offered. If the BLM rejects your bid under this provision, you 
will be notified in writing and such notice will include the reasons 
for the rejection and what refunds to which you are entitled.
    (2) The BLM may make the next highest bidder the preferred 
applicant if the first successful bidder fails to satisfy the 
requirements under paragraph (f) of this section.
    (3) If the BLM is unable to determine the successful bidder, such 
as in the case of a tie, the BLM may re-offer the lands competitively 
to the tied bidders, or to all bidders.
    (4) If lands offered under this section receive no bids the BLM 
may:
    (i) Re-offer the lands through the competitive process under this 
section; or
    (ii) Make the lands available through the non-competitive 
application process found in subparts 2803, 2804, and 2805 of this 
part, if the BLM determines that doing so is in the public interest.
0
19. Add Sec.  2804.35 to subpart 2804 to read as follows:


Sec.  2804.35  How will the BLM prioritize my solar or wind energy 
application?

    The BLM will prioritize your application by placing it into one of 
three categories and may re-categorize your application based on new 
information received through surveys, public meetings, or other data 
collection, or after any changes to the application. The BLM will 
categorize your application based on the following screening criteria.
    (a) High-priority applications are given processing priority over 
medium- and low-priority applications, and may include lands that meet 
the following criteria:
    (1) Lands specifically identified for solar or wind energy 
development, other than designated leasing areas;
    (2) Previously disturbed sites or areas adjacent to previously 
disturbed or developed sites;
    (3) Lands currently designated as Visual Resource Management Class 
IV; or
    (4) Lands identified as suitable for disposal in BLM land use 
plans.
    (b) Medium-priority applications are given priority over low-
priority applications and may include lands that meet the following 
criteria:
    (1) BLM special management areas that provide for limited 
development, including recreation sites and facilities;
    (2) Areas where a project may adversely affect conservation lands, 
to include lands with wilderness characteristics that have been 
identified in an updated wilderness characteristics inventory;
    (3) Right-of-way avoidance areas;
    (4) Areas where project development may adversely affect resources 
and properties listed nationally such as the National Register of 
Historic Places, National Natural Landmarks, or National Historic 
Landmarks;
    (5) Sensitive habitat areas, including important eagle use areas, 
priority sage grouse habitat, riparian areas, or areas of importance 
for Federal or State sensitive species;
    (6) Lands currently designated as Visual Resource Management Class 
III;
    (7) Department of Defense operating areas with land use or 
operational conflicts; or

[[Page 59071]]

    (8) Projects with proposed groundwater uses within groundwater 
basins that have been allocated by state water resource agencies.
    (c) Low-priority applications may not be feasible to authorize. 
These applications may include lands that meet the following criteria:
    (1) Lands near or adjacent to lands designated by Congress, the 
President, or the Secretary for the protection of sensitive viewsheds, 
resources, and values (e.g., units of the National Park System, Fish 
and Wildlife Service Refuge System, some National Forest System units, 
and the BLM National Landscape Conservation System), which may be 
adversely affected by development;
    (2) Lands near or adjacent to Wild, Scenic, and Recreational Rivers 
and river segments determined suitable for Wild or Scenic River status, 
if project development may have significant adverse effects on 
sensitive viewsheds, resources, and values;
    (3) Designated critical habitat for federally threatened or 
endangered species, if project development is likely to result in the 
destruction or adverse modification of that critical habitat;
    (4) Lands currently designated as Visual Resource Management Class 
I or Class II;
    (5) Right-of-way exclusion areas; or
    (6) Lands currently designated as no surface occupancy for oil and 
gas development in BLM land use plans.

Subpart 2805--Terms and Conditions of Grants

0
20. Amend Sec.  2805.10 as follows:
0
a. Revise the section heading;
0
b. Revise paragraph (a);
0
c. Redesignate paragraph (b) and (c) as paragraphs (c) and (d) 
respectively; and
0
d. Add new paragraph (b).
    The revisions and additions read as follows:


Sec.  2805.10  How will I know whether the BLM has approved or denied 
my application or if my bid for a solar or wind energy development 
grant or lease is successful or unsuccessful?

    (a) The BLM will send you a written response when it has made a 
decision on your application or if you are the successful bidder for a 
solar or wind energy development grant or lease. If we approve your 
application, we will send you an unsigned grant for your review and 
signature. If you are the successful bidder for a solar or wind energy 
lease inside a designated leasing area under Sec.  2809.15, we will 
send you an unsigned lease for your review and signature. If your bid 
is unsuccessful, it will be refunded under Sec. Sec.  2804.30(e)(4) or 
2809.14(d) and you will receive written notice from us.
    (b) Your unsigned grant or lease document:
    (1) Will include any terms, conditions, and stipulations that we 
determine to be in the public interest, such as modifying your proposed 
use or changing the route or location of the facilities;
    (2) May include terms that prevent your use of the right-of-way 
until you have an approved Plan of Development and BLM has issued a 
Notice to Proceed; and
    (3) Will impose a specific term for the grant or lease. Each grant 
or lease that we issue for 20 or more years will contain a provision 
requiring periodic review at the end of the twentieth year and 
subsequently at 10-year intervals. We may change the terms and 
conditions of the grant or lease, including leases issued under subpart 
2809, as a result of these reviews in accordance with Sec.  2805.15(e).
* * * * *
0
21. Amend Sec.  2805.11 by redesignating paragraph (b)(2) as paragraph 
(b)(3), adding new paragraph (b)(2), and revising newly redesignated 
paragraph (b)(3)to read as follows:


Sec.  2805.11  What does a grant contain?

* * * * *
    (b) * * *
    (2) Specific terms for solar and wind energy grants and leases are 
as follows:
    (i) For a wind energy site-specific testing grant, the term is 3 
years or less, without the option of renewal;
    (ii) For a wind energy project area testing grant, the initial term 
is 3 years or less, with the option to renew for one additional 3-year 
period when the renewal application is also accompanied by a wind 
energy development application and a POD as required by Sec.  
2804.10(c)(4);
    (iii) For a short-term grant for all other associated actions not 
specifically included in paragraphs (b)(2)(i) and (ii) of this section, 
such as geotechnical testing and other temporary land disturbing 
activities, the term is 3 years or less;
    (iv) For solar and wind energy development grants located outside 
of designated leasing areas, the term is for up to 30 years (plus the 
initial partial year of issuance) with adjustable terms and conditions. 
The grantee may submit an application for renewal under Sec.  
2805.14(g); and
    (v) For solar and wind energy development leases located inside 
designated leasing areas, the term is fixed for 30 years (plus the 
initial partial year of issuance). The lessee may submit an application 
for renewal under Sec.  2805.14(g).
    (3) All grants and leases, except those issued for a term of 3 
years or less and those issued in perpetuity, will expire on December 
31 of the final year of the grant or lease. For grants and leases with 
terms greater than 3 years, the actual term includes the number of full 
years specified, plus the initial partial year, if any.
* * * * *
0
22. Revise Sec.  2805.12 to read as follows:


Sec.  2805.12  What terms and conditions must I comply with?

    (a) By accepting a grant or lease, you agree to comply with and be 
bound by the following terms and conditions. During construction, 
operation, maintenance, and termination of the project you must:
    (1) To the extent practicable, comply with all existing and 
subsequently enacted, issued, or amended Federal laws and regulations 
and State laws and regulations applicable to the authorized use;
    (2) Rebuild and repair roads, fences, and established trails 
destroyed or damaged by the project;
    (3) Build and maintain suitable crossings for existing roads and 
significant trails that intersect the project;
    (4) Do everything reasonable to prevent and suppress wildfires on 
or in the immediate vicinity of the right-of-way area;
    (5) Not discriminate against any employee or applicant for 
employment during any stage of the project because of race, creed, 
color, sex, sexual orientation, or national origin. You must also 
require subcontractors to not discriminate;
    (6) Pay monitoring fees and rent described in Sec.  2805.16 and 
subpart 2806;
    (7) Assume full liability if third parties are injured or damages 
occur to property on or near the right-of-way (see Sec.  2807.12);
    (8) Comply with project-specific terms, conditions, and 
stipulations, including requirements to:
    (i) Restore, revegetate, and curtail erosion or conduct any other 
rehabilitation measure the BLM determines necessary;
    (ii) Ensure that activities in connection with the grant comply 
with air and water quality standards or related facility siting 
standards contained in applicable Federal or State law or regulations;
    (iii) Control or prevent damage to:

[[Page 59072]]

    (A) Scenic, aesthetic, cultural, and environmental values, 
including fish and wildlife habitat;
    (B) Public and private property; and
    (C) Public health and safety;
    (iv) Protect the interests of individuals living in the general 
area who rely on the area for subsistence uses as that term is used in 
Title VIII of Alaska National Interest Lands Conservation Act (ANILCA) 
(16 U.S.C. 3111 et seq.);
    (v) Ensure that you construct, operate, maintain, and terminate the 
facilities on the lands in the right-of-way in a manner consistent with 
the grant or lease, including the approved POD, if one was required;
    (vi) When the State standards are more stringent than Federal 
standards, comply with State standards for public health and safety, 
environmental protection, and siting, constructing, operating, and 
maintaining any facilities and improvements on the right-of-way; and
    (vii) Grant the BLM an equivalent authorization for an access road 
across your land if the BLM determines that a reciprocal authorization 
is needed in the public interest and the authorization the BLM issues 
to you is also for road access;
    (9) Immediately notify all Federal, State, tribal, and local 
agencies of any release or discharge of hazardous material reportable 
to such entity under applicable law. You must also notify the BLM at 
the same time and send the BLM a copy of any written notification you 
prepared;
    (10) Not dispose of or store hazardous material on your right-of-
way, except as provided by the terms, conditions, and stipulations of 
your grant;
    (11) Certify your compliance with all requirements of the Emergency 
Planning and Community Right-to-Know Act of 1986, (42 U.S.C. 11001 et 
seq.), when you receive, assign, renew, amend, or terminate your grant;
    (12) Control and remove any release or discharge of hazardous 
material on or near the right-of-way arising in connection with your 
use and occupancy of the right-of-way, whether or not the release or 
discharge is authorized under the grant. You must also remediate and 
restore lands and resources affected by the release or discharge to the 
BLM's satisfaction and to the satisfaction of any other Federal, State, 
tribal, or local agency having jurisdiction over the land, resource, or 
hazardous material;
    (13) Comply with all liability and indemnification provisions and 
stipulations in the grant;
    (14) As the BLM directs, provide diagrams or maps showing the 
location of any constructed facility;
    (15) The BLM may require you to provide, or give access to, any 
pertinent environmental, technical, and financial records, reports, and 
other information, such as Power Purchase and Interconnection 
Agreements or the production and sale data of electricity generated 
from the approved facilities on public land. The BLM may use this and 
similar information for the purpose of monitoring your authorization 
and for periodic evaluation of financial obligations under the 
authorization, as appropriate. Any records the BLM obtains will be made 
available to the public for inspection and duplication under the 
Freedom of Information Act. Any information marked confidential or 
proprietary will be kept confidential to the extent allowed by law. 
Failure to comply with such requirements may, at the discretion of the 
BLM, result in suspension or termination of the right-of-way 
authorization; and
    (16) Comply with all other stipulations that the BLM may require.
    (b) You must comply with the bonding requirements under Sec.  
2805.20.
    (c) By accepting a grant or lease for solar or wind energy 
development, you also agree to comply with and be bound by the 
following terms and conditions. You must:
    (1) Not begin any ground disturbing activities until the BLM issues 
a Notice to Proceed (see Sec.  2807.10) or written approval to proceed 
with ground disturbing activities;
    (2) Complete construction within the timeframes in the approved 
POD, but no later than 24 months after the start of construction, 
unless the project has been approved for staged development;
    (3) If an approved POD provides for staged development and not 
otherwise agreed to by BLM:
    (i) Begin construction of the initial phase of development within 
12 months after issuance of the Notice to Proceed, but no later than 24 
months after the effective date of the right-of-way authorization;
    (ii) Begin construction of each stage of development (following the 
first) within 3 years of the start of construction of the previous 
stage of development, and complete construction no later than 24 months 
after the start of construction for that stage; and
    (iii) Have no more than 3 development stages, unless the BLM 
approves more development stages in advance.
    (4) Maintain all onsite electrical generation equipment and 
facilities in accordance with the design standards in the approved POD;
    (5) Repair, place into service, or remove from the site damaged or 
abandoned facilities that have been inoperative for any continuous 
period of 3 months that present an unnecessary hazard to the public 
lands. You must take appropriate remedial action within 30 days after 
receipt of a written noncompliance notice, unless you have been 
provided an extension of time by the BLM. Alternatively, you must show 
good cause for any delays in repairs, use, or removal; estimate when 
corrective action will be completed; provide evidence of diligent 
operation of the facilities; and submit a written request for an 
extension of the 30-day deadline. If you do not comply with this 
provision, the BLM may suspend or terminate the authorization under 
Sec. Sec.  2807.17 through 2807.19; and
    (6) Comply with the diligent development provisions of the 
authorization or the BLM may suspend or terminate your grant or lease 
under Sec.  2807.17. Before suspending or terminating the 
authorization, the BLM will send you a notice that gives you a 
reasonable opportunity to correct any noncompliance or to start or 
resume use of the right-of-way (see Sec.  2807.18). In response to this 
notice, you must:
    (i) Provide reasonable justification for any delays in construction 
(for example, delays in equipment delivery, legal challenges, and acts 
of God);
    (ii) Provide the anticipated date of completion of construction and 
evidence of progress toward the start or resumption of construction; 
and
    (iii) Submit a written request under Sec.  2807.11(d) for extension 
of the timelines in the approved POD. If you do not comply with the 
requirements of Sec.  2804.12(c)(7), the BLM may deny your request for 
an extension of the timelines in the approved POD.
    (7) In addition to the RCE requirements of Sec.  2805.20(a)(5) for 
a grant, the bond secured for a grant or lease must cover cultural 
resource and Indian cultural resource identification, protection and 
mitigation.
    (d) For wind energy site or project testing grants:
    (1) You must install all monitoring facilities within 12 months 
after the effective date of the grant or other authorization. If 
monitoring facilities under a site testing and monitoring right-of-way 
authorization have not been installed within 12 months after the 
effective date of the authorization or consistent with the timeframe of 
the approved POD, you must show good cause for and the nature of any 
delay, the anticipated date of installation of

[[Page 59073]]

facilities, and evidence of progress toward site monitoring activities;
    (2) You must maintain all onsite equipment and facilities in 
accordance with the approved design standards;
    (3) You must repair, place into service, or remove from the site 
damaged or abandoned facilities that have been inoperative for any 
continuous period of 3 months that present an unnecessary hazard to the 
public lands; and
    (4) If you do not comply with the due diligence terms and 
conditions of either the wind site testing and monitoring authorization 
or the wind energy development authorization, the BLM may terminate 
your authorization under Sec.  2807.17.
0
23. Amend Sec.  2805.14 by removing ``and'' from the end of paragraph 
(e), removing the period from the end of paragraph (f) and adding ``; 
and'' in its place, and adding paragraphs (g) and (h) to read as 
follows:


Sec.  2805.14  What rights does a grant convey?

* * * * *
    (g) Apply to renew your solar or wind energy development grant or 
lease, under Sec.  2807.22; and
    (h) Apply to renew your wind energy project area testing grant for 
one additional term of 3 years or less when the renewal application 
also includes a wind energy development application.
0
24. In Sec.  2805.15, revise the first sentence of paragraph (b) to 
read as follows:


Sec.  2805.15  What rights does the United States retain?

* * * * *
    (b) Require common use of your right-of-way, including facilities 
(see Sec.  2805.14(b)), subsurface and air space, and authorize use of 
the right-of-way for compatible uses. * * *
* * * * *
0
25. Revise Sec.  2805.16 to read as follows:


Sec.  2805.16  If I hold a grant, what monitoring fees must I pay?

    (a) You must pay a fee to the BLM for the reasonable costs the 
Federal Government incurs in monitoring the construction, operation, 
maintenance, and termination of the project and protection and 
rehabilitation of the public lands your grant covers. Instead of paying 
the BLM a fee for the reasonable costs incurred by other Federal 
agencies in monitoring your grant, you may pay the other Federal 
agencies directly for such costs. The BLM will annually adjust the 
Category 1 through 4 monitoring fees in the manner described at Sec.  
2804.14(b). The BLM will update Category 5 monitoring fees as specified 
in the Master Agreement. The BLM categorizes the monitoring fees based 
on the estimated number of work hours necessary to monitor your grant. 
Category 1 through 4 monitoring fees are one-time fees and are not 
refundable. The monitoring categories and work hours are as follows:

                          Monitoring Categories
------------------------------------------------------------------------
            Monitoring category              Federal work hours involved
------------------------------------------------------------------------
(1) Applications for new grants,             Estimated Federal work
 assignments, renewals, and amendments to     hours are > 1 <= 8.
 existing grants.
(2) Applications for new grants,             Estimated Federal work
 assignments, renewals, and amendments to     hours are > 8 <= 24.
 existing grants.
(3) Applications for new grants,             Estimated Federal work
 assignments, renewals, and amendments to     hours are > 24 <= 36.
 existing grants.
(4) Applications for new grants,             Estimated Federal work
 assignments, renewals, and amendments to     hours > 36 <= 50.
 existing grants.
(5) Master Agreements......................  Varies.
(6) Applications for new grants,             Estimated Federal work
 assignments, renewals, and amendments to     hours are > 50.
 existing grants.
------------------------------------------------------------------------

    (b) The monitoring cost schedule is available from any BLM state, 
district, or field office or by writing: U.S. Department of the 
Interior, Bureau of Land Management, 20 M Street SE., Room 2134LM, 
Washington, DC 20003. The BLM also posts the current schedule at http://www.blm.gov.
0
26. Add Sec.  2805.20 to subpart 2805 to read as follows:


Sec.  2805.20  Bonding requirements.

    If you hold a grant or lease under this part, you must comply with 
the following bonding requirements.
    (a) The BLM may require that you obtain, or certify that you have 
obtained, a performance and reclamation bond or other acceptable bond 
instrument to cover any losses, damages, or injury to human health, the 
environment, and property in connection with your use and occupancy of 
the right-of-way, including terminating the grant, and to secure all 
obligations imposed by the grant and applicable laws and regulations. 
If you plan to use hazardous materials in the operation of your grant, 
you must provide a bond that covers liability for damages or injuries 
resulting from releases or discharges of hazardous materials. The BLM 
may require a new bond, an increase or decrease in the value of an 
existing bond, or other acceptable security at any time during the term 
of the grant or lease.
    (1) The BLM must be listed as an additionally named insured on the 
bond instrument if a State regulatory authority requires a bond to 
cover some portion of environmental liabilities, such as hazardous 
material damages or releases, reclamation, or other requirements for 
the project. The bond must:
    (i) Be redeemable by the BLM;
    (ii) Be held or approved by a State agency for the same reclamation 
requirements as specified by our right-of-way authorization; and
    (iii) Provide the same or greater financial guarantee that we 
require for the portion of environmental liabilities covered by the 
State's bond.
    (2) Bond acceptance. The BLM authorized officer must review and 
approve all bonds, including any State bonds, prior to acceptance, and 
at the time of any right-of-way assignment, amendment, or renewal.
    (3) Bond amount. Unless you hold a solar or wind energy lease under 
subpart 2809, the bond amount will be determined based on the 
preparation of a RCE. We may require you to prepare and submit an 
acceptable RCE. The estimate must include our cost to administer a 
reclamation contract.
    (4) You must post a bond on or before the deadline that we give 
you.
    (5) Bond components that must be addressed when determining the RCE 
amount include, but are not limited to:

[[Page 59074]]

    (i) Environmental liabilities such as use of hazardous materials 
waste and hazardous substances, herbicide use, the use of petroleum-
based fluids, and dust control or soil stabilization materials;
    (ii) The decommissioning, removal, and proper disposal, as 
appropriate, of any improvements and facilities; and
    (iii) Interim and final reclamation, re-vegetation, recontouring, 
and soil stabilization. This component must address the potential for 
flood events and downstream sedimentation from the site that may result 
in offsite impacts.
    (6) You may ask us to accept a replacement performance and 
reclamation bond at any time after the approval of the initial bond. We 
will review the replacement bond for adequacy. A surety company is not 
released from obligations that accrued while the surety bond was in 
effect unless the replacement bond covers those obligations to our 
satisfaction.
    (7) You must notify us that reclamation has occurred and you may 
request that the BLM reevaluate your bond. If we determine that you 
have completed reclamation, we may release all or part of your bond.
    (8) If you hold a grant, you are still liable under Sec.  2807.12 
if:
    (i) We release all or part of your bond;
    (ii) The bond amount does not cover the cost of reclamation; or
    (iii) There is no bond in place.
    (b) If you hold a grant for solar energy development outside of 
designated leasing areas, you must provide a performance and 
reclamation bond (see paragraph (a) of this section). We will determine 
the bond amount based on the RCE (see paragraph (a)(3) of this section) 
and it must be no less than $10,000 per acre.
    (c) If you hold a grant for wind energy development outside of 
designated leasing areas, you must provide a performance and 
reclamation bond (see paragraph (a) of this section). We will determine 
the bond amount based on the RCE (see paragraph (a)(3) of this section) 
and must be no less than $20,000 per authorized turbine. For short-term 
right-of-way grants for wind energy site or project testing, the bond 
amount must be no less than $2,000 per authorized meteorological tower.

Subpart 2806--Rents

0
27. Amend Sec.  2806.12 by revising the section heading and paragraphs 
(a) and (b) and adding paragraph (d) to read as follows:


Sec.  2806.12  When and where do I pay rent?

    (a) You must pay rent for the initial rental period before the BLM 
issues you a grant or lease.
    (1) If your non-linear grant or lease is effective on:
    (i) January 1 through September 30 and qualifies for annual 
payments, your initial rent bill is pro-rated to include only the 
remaining full months in the initial year; or
    (ii) October 1 through December 31 and qualifies for annual 
payments, your initial rent bill is pro-rated to include the remaining 
full months in the initial year plus the next full year.
    (2) If your non-linear grant allows for multi-year payments, such 
as a short term grant issued for wind energy site specific testing, you 
may request that your initial rent bill be for the full term of the 
grant instead of the initial rent bill periods provided paragraphs 
(a)(1)(i) or (ii) of this section.
    (b) You must make all other rental payments for linear rights-of-
way according to the payment plan described in Sec.  2806.24.
* * * * *
    (d) You make all rental payments as instructed by us or as provided 
for by Secretarial order or legislative authority.
0
28. Amend Sec.  2806.13 by:
    a. Revising the section heading and paragraph (a);
    b. Redesignating paragraph (e) as paragraph (f); and
    c. Adding new paragraphs (e) and (g).
    The revisions and additions read as follows:


Sec.  2806.13  What happens if I do not pay rents and fees or if I pay 
the rents or fees late?

    (a) If the BLM does not receive the rent or fee payment required in 
this subpart 2806 within 15 calendar days after the payment was due 
under Sec.  2806.12, we will charge you a late payment fee of $25 or 10 
percent of the amount you owe, whichever is greater, per authorization.
* * * * *
    (e) Subject to applicable laws and regulations, we will 
retroactively bill for uncollected or under-collected rent, fees, and 
late payments, if:
    (1) A clerical error is identified;
    (2) An adjustment to rental schedules is not applied; or
    (3) An omission or error in complying with the terms and conditions 
of the authorized right-of-way is identified.
* * * * *
    (g) We will not approve any further activities associated with your 
right-of-way until you make any outstanding payments that are due.
0
29. In Sec.  2806.20, revise paragraph (c) to read as follows:


Sec.  2806.20  What is the rent for a linear right-of-way grant?

* * * * *
    (c) You may obtain a copy of the current Per Acre Rent Schedule 
from any BLM state, district, or field office or by writing: U.S. 
Department of the Interior, Bureau of Land Management, 20 M Street SE., 
Room 2134LM, Washington, DC 20003. We also post the current rent 
schedule at http://www.blm.gov.
0
30. In Sec.  2806.22, revise the second sentence of paragraph (a) to 
read as follows:


Sec.  2806.22  When and how does the Per Acre Rent Schedule change?

    (a) * * * For example, the average annual change in the IPD-GDP 
from 1994 to 2003 (the 10-year period immediately preceding the year 
(2004) that the 2002 National Agricultural Statistics Service Census 
data became available) was 1.9 percent. * * *
* * * * *
0
31. Amend Sec.  2806.23 by removing paragraph (b) and redesignating 
paragraph (c) as paragraph (b).
0
32. In Sec.  2806.24, revise paragraph (c) to read as follows:


Sec.  2806.24  How must I make rental payments for a linear grant?

* * * * *
    (c) Proration of payments. The BLM prorates the first year rental 
amount based on the number of months left in the calendar year after 
the effective date of the grant. If your grant requires, or you chose a 
10-year payment term, or multiples thereof, the initial rent bill 
consists of the remaining partial year plus the next 10 years, or 
multiple thereof.
0
33. Amend Sec.  2806.30 by:
0
a. Revising paragraphs (a)(1) and (a)(2);
0
b. Removing paragraph (b); and
0
c. Redesignating paragraph (c) as paragraph (b).
    The revisions read as follows:


Sec.  2806.30  What are the rents for communication site rights-of-way?

    (a) Rent schedule. (1) The BLM uses a rent schedule for 
communication site rights-of-way to calculate the rent for 
communication site rights-of-way. The schedule is based on nine 
population strata (the population served), as depicted in the most 
recent version of the Ranally Metro Area (RMA) Population Ranking, and 
the type of communication use or uses for which we normally grant 
communication site rights-of-way. These uses are listed as part of the 
definition of ``communication use rent schedule,'' set out at Sec.  
2801.5(b). You may obtain a copy of the current schedule from any BLM 
state, district, or field office or by

[[Page 59075]]

writing: U.S. Department of the Interior, Bureau of Land Management, 20 
M Street SE., Room 2134LM, Washington, DC 20003. We also post the 
current communication use rent schedule at http://www.blm.gov.
    (2) We update the schedule annually based on two sources: The U.S. 
Department of Labor Consumer Price Index for All Urban Consumers, U.S. 
City Average (CPI-U), as of July of each year (difference in CPI-U from 
July of one year to July of the following year), and the RMA population 
rankings.
* * * * *
0
34. In Sec.  2806.34, revise the second sentence of paragraph (b)(4) to 
read as follows:


Sec.  2806.34  How will BLM calculate the rent for a grant or lease 
authorizing a multiple-use communication facility?

* * * * *
    (4) * * * This paragraph does not apply to facilities exempt from 
rent under Sec.  2806.14(a)(4) except when the facility also includes 
ineligible facilities.
0
35. In Sec.  2806.43, revise the third sentence of paragraph (a) to 
read as follows:


Sec.  2806.43  How does BLM calculate rent for passive reflectors and 
local exchange networks?

    (a) * * * For passive reflectors and local exchange networks not 
covered by a Forest Service regional schedule, we use the provisions in 
Sec.  2806.70 to determine rent. * * *
* * * * *
0
36. Amend Sec.  2806.44 by adding introductory text and revising 
paragraph (a) to read as follows:


Sec.  2806.44  How will BLM calculate rent for a facility owner's or 
facility manager's grant or lease which authorizes communication uses.

    This section applies to a grant or lease that authorizes a mixture 
of communication uses, some of which are subject to the communication 
use rent schedule and some of which are not. We will determine rent for 
these leases under the provisions of this section.
    (a) The BLM establishes the rent for each of the uses in the 
facility that are not covered by the communication use rent schedule 
using Sec.  2806.70.
* * * * *
0
37. Remove the undesignated centered heading preceding Sec.  2806.50.
0
38. Redesignate Sec.  2806.50 as Sec.  2806.70.
0
39. Add an undesignated centered heading and new Sec.  2806.50 to read 
as follows:

Solar Energy Rights-of-Way


Sec.  2806.50  Rents and fees for solar energy rights-of-way.

    If you hold a solar energy right-of-way authorization, you must pay 
an annual rent and fee in accordance with this section and subpart. 
Your solar energy right-of-way authorization will either be a grant (if 
located outside a designated leasing area) or a lease (if located 
inside a designated leasing area). Rents and fees for either type of 
authorization consist of an acreage rent that must be paid prior to 
issuance of the authorization and a phased-in MW capacity fee. Both the 
acreage rent and the phased-in MW capacity fee are charged and 
calculated consistent with Sec.  2806.11 and prorated consistent with 
Sec.  2806.12(a). The MW capacity fee will vary depending on the size 
and technology of the solar energy development project.
0
40. Add new Sec.  2806.52 to read as follows:


Sec.  2806.52  Rents and fees for solar energy development grants.

    You must pay an annual rent and fee for your solar energy 
development grant as follows:
    (a) Acreage rent. The acreage rent is calculated by multiplying the 
number of acres (rounded up to the nearest tenth of an acre) within the 
authorized area times the per-acre county rate in effect at the time 
the authorization is issued;
    (1) Per-acre county rate. The per-acre county rate is 200 percent 
of the per-acre rent value for each county using the BLM's linear rent 
schedule (see Sec.  2806.20(c)). The BLM will adjust the per-acre 
county rates each year based on the average annual change in the IPD-
GDP as determined under Sec.  2806.22(a). Adjusted rates are effective 
each year on January 1. You may obtain a copy of the current per-acre 
county rates for solar energy development from any BLM state, district, 
or field office or by writing: U.S. Department of the Interior, Bureau 
of Land Management, 20 M Street SE., Room 2134LM, Attention: Renewable 
Energy Coordination Office, Washington, DC 20003;
    (2) Acreage rent payment. You must pay the acreage rent regardless 
of the stage of development or operations on the entire public land 
acreage described in the right-of-way authorization. The BLM State 
Director may approve a rental payment plan consistent with Sec.  
2806.15(c);
    (3) Acreage rent adjustments. For authorizations outside of 
designated leasing areas, the BLM will adjust the acreage rent annually 
to reflect the change in the per-acre county rates as specified in 
paragraph (a)(1) of this section. The BLM will use the most current 
per-acre county rates to calculate the acreage rent for each year of 
the grant term. If you hold a solar energy lease, acreage rent will be 
adjusted under Sec.  2806.54(a)(3);
    (b) MW capacity fee. The MW capacity fee is calculated by 
multiplying the approved MW capacity by the MW rate (for the applicable 
type of technology employed by the project) from the MW Rate Schedule 
(see paragraph (b)(2) of this section). You must pay the MW capacity 
fee annually when electricity generation begins or is scheduled to 
begin in the approved POD, whichever comes first;
    (1) MW rate. The MW rate is calculated by multiplying the total 
hours per year, by the net capacity factor, by the MWh price, by the 
rate of return. For an explanation of each of these terms, see the 
definition of MW rate in Sec.  2801.5. The MW rate is phased in as 
described under paragraph (b)(4) of this section.
    (2) MW rate schedule. You may obtain a copy of the current MW Rate 
Schedule for solar energy development from any BLM state, district, or 
field office or by writing: U.S. Department of the Interior, Bureau of 
Land Management, 20 M Street SE., Room 2134LM, Attention: Renewable 
Energy Coordination Office, Washington, DC 20003. The BLM also posts 
the current MW Rate Schedule for solar energy development at http://www.blm.gov;
    (3) Periodic adjustments in the MW rate. The BLM will adjust the MW 
rate every 5 years, beginning in 2020, by recalculating the following 
two components of the MW rate formula:
    (i) The adjusted MWh price is the 5-year average of the annual 
weighted average wholesale price per MWh for the major ICE trading hubs 
serving the 11 Western States of the continental United States for the 
5-year period preceding the adjustment, rounded to the nearest five 
dollar increment; and
    (ii) The adjusted rate of return is the 10-year average of the 20-
year U.S. Treasury bond yield for the 10-year period preceding the 
adjustment, rounded up to the nearest one-half percent, with a minimum 
rate of return of four percent.
    (4) MW rate phase-in. If you hold a solar energy development grant, 
the MW rate will be phased in as follows:
    (i) There is a 3-year phase-in of the MW rate after generation of 
electricity starts at the rates of:
    (A) 25 percent for the first year. The MW rate for year 1 of the 
phase-in period is for the first partial calendar

[[Page 59076]]

year of operations (at 25 percent of the current MW rate);
    (B) 50 percent for the second year; and
    (C) 100 percent for the third and subsequent years of operations.
    (ii) After generation of electricity starts and an approved POD 
provides for staged development:
    (A) The 3-year phase-in of the MW rate applies to each stage of 
development; and
    (B) The MW capacity fee is calculated using the authorized MW 
capacity approved for that stage plus any previously approved stages, 
multiplied by the MW rate.
0
41. Add new Sec.  2806.54 to read as follows:


Sec.  2806.54  Rents and fees for solar energy development leases 
inside designated leasing areas.

    If you hold a solar energy development lease obtained through 
competitive bidding under subpart 2809 of this part, you must pay an 
annual rent and fee in accordance with this section and subpart, in 
addition to the one-time, upfront bonus bid you paid to obtain the 
lease. The annual rent and fee includes an acreage rent for the number 
of acres included within the solar energy lease and an additional MW 
capacity fee based on the total authorized MW capacity for the approved 
solar energy project on the public land.
    (a) Acreage rent. The BLM will calculate and bill you an acreage 
rent that must be paid prior to issuance of your lease as described in 
Sec.  2806.52(a).
    (1) Per-acre county rate. See Sec.  2806.52 (a)(1).
    (2) Acreage rent payment. See Sec.  2806.52(a)(2).
    (3) Acreage rent adjustments. Once the acreage rent is determined 
under Sec.  2806.52(a), no further adjustments in the annual acreage 
rent will be made until year 11 of the lease term and each subsequent 
10-year period thereafter. The BLM will use the per-acre county rates 
in effect when it adjusts the annual acreage rent at those 10-year 
intervals.
    (b) MW capacity fee. See Sec.  2806.52 (b)(1), (2), and (3).
    (c) MW rate phase-in. If you hold a solar energy development lease, 
the MW capacity fee will be phased in, starting when electricity begins 
to be generated. The MW capacity fee for years 1-20 will be calculated 
using the MW rate in effect when the lease is issued. The MW capacity 
fee for years 21-30 will be calculated using the MW rate in effect in 
year 21 of the lease. These rates will be phased-in as follows:
    (1) For years 1 through 10 of the lease, plus any initial partial 
year, the MW capacity fee is calculated by multiplying the project's 
authorized MW capacity by 50 percent of the applicable solar technology 
MW rate, as described in Sec.  2806.52(b);
    (2) For years 11 through 20 of the lease, the MW capacity fee is 
calculated by multiplying the project's authorized MW capacity by 100 
percent of the applicable solar technology MW rate, as described in 
Sec.  2806.52(b).
    (3) For years 21 through 30 of the lease, the MW capacity fee is 
calculated by multiplying the project's authorized MW capacity by 100 
percent of the applicable solar technology MW rate, as described in 
Sec.  2806.52(b)(2).
    (4) If the lease is renewed, the MW capacity fee is calculated 
using the MW rates at the beginning of the renewed lease period and 
will remain at that rate through the initial 10-year period of the 
renewal term. The MW capacity fee will be adjusted using the MW rate at 
the beginning of each subsequent 10-year period of the renewed lease 
term.
    (5) If an approved POD provides for staged development, the MW 
capacity fee is calculated using the MW capacity approved for that 
stage plus any previously approved stages, multiplied by the MW rate as 
described under this section.
0
42. Add new Sec.  2806.56 to read as follows:


Sec.  2806.56  Rent for support facilities authorized under separate 
grant(s).

    If a solar energy development project includes separate right-of-
way authorizations issued for support facilities only (administration 
building, groundwater wells, construction lay down and staging areas, 
surface water management and control structures, etc.) or linear right-
of-way facilities (pipelines, roads, power lines, etc.), rent is 
determined using the Per Acre Rent Schedule for linear facilities (see 
Sec.  2806.20(c)).
0
43. Add an undesignated centered heading and new Sec. Sec.  2806.60, 
2806.62, 2806.64, 2806.66, and 2806.68, to read as follows:

Wind Energy Rights-of-Way


Sec.  2806.60  Rents and fees for wind energy rights-of-way.

    If you hold a grant for wind energy site-specific testing or 
project-area testing or if you hold a wind energy development right-of-
way authorization, you must pay an annual rent and fee in accordance 
with this section and subpart. Your wind energy development right-of-
way authorization will either be a grant (if located outside a 
designated leasing area) or a lease (if located inside a designated 
leasing area). Rents and fees for either type of authorization consist 
of an acreage rent that must be paid prior to issuance of the 
authorization and a phased-in MW capacity fee. Both the acreage rent 
and the phased-in MW capacity fee are charged and calculated consistent 
with Sec.  2806.11 and prorated consistent with Sec.  2806.12(a). The 
MW capacity fee will vary depending on the size of the wind energy 
development project.


Sec.  2806.62  Rents and fees for wind energy development grants.

    You must pay an annual rent and fee for your wind energy 
development grant as follows:
    (a) Acreage rent. The acreage rent is calculated by multiplying the 
number of acres (rounded up to the nearest tenth of an acre) within the 
authorized area times the per-acre county rate in effect at the time 
the authorization is issued;
    (1) Per-acre county rate. The per-acre county rate is 20 percent of 
the per acre rent value for each county using the BLM's Per Acre Rent 
Schedule (see Sec.  2806.20(c)). We will adjust the per-acre county 
rates each year based on the average annual change in the IPD-GDP as 
determined under Sec.  2806.22(a). Adjusted rates are effective each 
year on January 1. You may obtain a copy of the current per-acre county 
rates for wind energy development from any BLM state, district, or 
field office or by writing: U.S. Department of the Interior, Bureau of 
Land Management, 20 M Street SE., Room 2134LM, Attention: Renewable 
Energy Coordination Office, Washington, DC 20003. The BLM also posts 
the current per-acre county rate for wind energy development at http://www.blm.gov.
    (2) Acreage rent payment. You must pay the acreage rent regardless 
of the stage of development or operations on the entire public land 
acreage described in the right-of-way authorization. The BLM State 
Director may approve a rental payment plan consistent with Sec.  
2806.15(c); and
    (3) Acreage rent adjustments. We will adjust the acreage rent 
annually to reflect the change in the per-acre county rates as 
specified in paragraph (a)(1) of this section. The BLM will use the 
most current per-acre county rates to calculate the acreage rent for 
each year of the grant term. If you hold a wind energy lease, acreage 
rent will be adjusted under Sec.  2806.64(a)(3).
    (b) MW capacity fee. The MW capacity fee is calculated by 
multiplying the approved MW capacity by the MW rate. You must pay the 
MW capacity fee annually when electricity generation begins or is 
scheduled to begin in the approved POD, whichever comes first.

[[Page 59077]]

    (1) MW rate. The MW rate is calculated by multiplying the total 
hours per year by the net capacity factor, by the MWh price, by the 
rate of return. For an explanation of each of these terms, see the 
definition of MW rate in Sec.  2801.5. If your right-of-way includes 
approved stages of development, your rate will be phased in as 
described under paragraph (b)(4) of this section.
    (2) MW rate schedule. You may obtain a copy of the current MW rate 
schedule for wind energy development from any BLM state, district, or 
field office or by writing: U.S. Department of the Interior, Bureau of 
Land Management, 20 M Street SE., Room 2134LM, Attention: Renewable 
Energy Coordination Office, Washington, DC 20003. The BLM also posts 
the current MW Rate Schedule for wind energy development at http://www.blm.gov;
    (3) Periodic adjustments in the MW rate. We will adjust the MW rate 
every 5 years, beginning in 2020, by recalculating the following two 
components of the MW rate formula:
    (i) The adjusted MWh price is the 5-year average of the annual 
weighted average wholesale price per MWh for the major ICE trading hubs 
serving the 11 Western States of the continental United States for the 
5-year period preceding the adjustment, rounded to the nearest five 
dollar increment; and
    (ii) The adjusted rate of return is the 10-year average of the 20-
year U.S. Treasury bond yield for the 10-year period preceding the 
adjustment, rounded up to the nearest one-half percent, with a minimum 
rate of return of four percent.
    (4) MW rate phase-in. If you hold a wind energy development grant, 
the MW rate will be phased in as follows:
    (i) There is a 3-year phase-in of the MW rate after generation of 
electricity starts at the rates of:
    (A) 25 percent for the first year. The MW rate for year 1 of the 
phase-in period is for the first partial calendar year of operations 
(at 25 percent of the current MW rate);
    (B) 50 percent for the second year; and
    (C) 100 percent for the third and subsequent years of operations.
    (ii) After generation of electricity starts and an approved POD 
provides for staged development:
    (A) The 3-year phase-in of the MW rate applies to each stage of 
development; and
    (B) The MW capacity fee is calculated using the authorized MW 
capacity approved for that stage plus any previously approved stages, 
multiplied by the MW rate.


Sec.  2806.64  Rents and fees for wind energy development leases inside 
designated leasing areas.

    If you hold a wind energy development lease obtained through 
competitive bidding under subpart 2809 of this part, you must pay an 
annual rent and fee in accordance with this section and subpart, in 
addition to the one-time, up front bonus bid you paid to obtain the 
lease. The annual rent includes an acreage rent for the number of acres 
included within the wind energy lease and an additional MW capacity fee 
based on the total authorized MW capacity for the approved wind energy 
project on the public land.
    (a) Acreage rent. The BLM will calculate and bill you an acreage 
rent that must be paid prior to issuance of your lease as described in 
Sec.  2806.62(a).
    (1) Per-acre county rate. See Sec.  2806.62(a)(1).
    (2) Acreage rent payment. See Sec.  2806.62(a)(2).
    (3) Acreage rent adjustments. Once the acreage rent is determined 
under Sec.  2806.62(a), no further adjustments in the annual acreage 
rent will be made until year 11 of the lease term and each subsequent 
10-year period thereafter. We will use the per-acre county rates in 
effect at the time the acreage rent is due (at the beginning of each 
10-year period) to calculate the annual acreage rent for each of the 
subsequent 10-year periods.
    (b) MW capacity fee. See Sec.  2806.62(b)(1), (2), and (3).
    (c) MW rate phase-in. If you hold a wind energy development lease, 
the MW capacity fee will be phased in, starting when electricity begins 
to be generated. The MW capacity fee for years 1-20 will be calculated 
using the MW rate in effect when the lease is issued. The MW capacity 
fee for years 21-30 will be calculated using the MW rate in effect in 
year 21 of the lease. These rates will be phased-in as follows:
    (1) For years 1 through 10 of the lease, plus any initial partial 
year, the MW capacity fee is calculated by multiplying the project's 
authorized MW capacity by 50 percent of the wind energy technology MW 
rate, as described in Sec.  2806.62(b);
    (2) For years 11 through 20 of the lease, the MW capacity fee is 
calculated by multiplying the project's authorized MW capacity by 100 
percent of the wind energy technology MW rate described in Sec.  
2806.62(b);
    (3) For years 21 through 30 of the lease, the MW capacity fee is 
calculated by multiplying the project's authorized MW capacity by 100 
percent of the wind energy technology MW rate as described in Sec.  
2806.62(b).
    (4) If the lease is renewed, the MW capacity fee is calculated 
using the MW rates at the beginning of the renewed lease period and 
will remain at that rate through the initial 10 year period of the 
renewal term. The MW capacity fee will continue to adjust at the 
beginning of each subsequent 10 year period of the renewed lease term 
to reflect the then currently applicable MW rates.
    (5) If an approved POD provides for staged development, the MW 
capacity fee is calculated using the MW capacity approved for that 
stage plus any previously approved stage, multiplied by the MW rate, as 
described in this section.


Sec.  2806.66  Rent for support facilities authorized under separate 
grant(s).

    If a wind energy development project includes separate right-of-way 
authorizations issued for support facilities only (administration 
building, groundwater wells, construction lay down and staging areas, 
surface water management, and control structures, etc.) or linear 
right-of-way facilities (pipelines, roads, power lines, etc.), rent is 
determined using the Per Acre Rent Schedule for linear facilities (see 
Sec.  2806.20(c)).


Sec.  2806.68  Rent for wind energy development testing grant(s).

    (a) Grant for wind energy site specific testing. You must pay $100 
per year for each meteorological tower or instrumentation facility 
location. BLM offices with approved small site rental schedules may use 
those fee structures if the fees in those schedules charge more than 
$100 per meteorological tower per year. In lieu of annual payments, you 
may instead pay for the entire term of the grant (3 years or less).
    (b) Grant for wind energy project area testing. You must pay $2,000 
per year or $2 per acre per year for the lands authorized by the grant, 
whichever is greater. There is no additional rent for the installation 
of each meteorological tower or instrumentation facility located within 
the site testing and monitoring project area.
0
44. Add an undesignated centered heading between Sec. Sec.  2806.68 and 
2806.70 to read as follows:

Other Rights-of-Way

0
45. Revise newly redesignated Sec.  2806.70 to read as follows:


Sec.  2806.70  How will the BLM determine the rent for a grant or lease 
when the linear, communication use, solar energy, or wind energy rent 
schedules do not apply?

    When we determine that the linear, communication use, solar, or 
wind energy rent schedules do not apply, we

[[Page 59078]]

may determine your rent through a process based on comparable 
commercial practices, appraisals, competitive bids, or other reasonable 
methods. We will notify you in writing of the rent determination. If 
you disagree with the rent determination, you may appeal our final 
determination under Sec.  2801.10.

Subpart 2807--Grant Administration and Operation

0
46. Amend Sec.  2807.11 by:
0
a. Revising paragraph (b);
0
b. Redesignating paragraphs (d) and (e) as paragraphs (f) and (g); and
0
c. Adding new paragraphs (d) and (e).
    The revisions and additions read as follows:


Sec.  2807.11  When must I contact BLM during operations?

* * * * *
    (b) When your use requires a substantial deviation from the grant. 
You must seek an amendment to your grant under Sec.  2807.20 and obtain 
our approval before you begin any activity that is a substantial 
deviation;
* * * * *
    (d) Whenever site-specific circumstances or conditions result in 
the need for changes to an approved right-of-way grant or lease, POD, 
site plan, mitigation measures, or construction, operation, or 
termination procedures that are not substantial deviations in location 
or use authorized by a right-of-way grant or lease. Changes for 
authorized actions, project materials, or adopted mitigation measures 
within the existing, approved right-of-way area must be submitted to us 
for review and approval.
    (e) To identify and correct discrepancies or inconsistencies.
* * * * *
0
47. Amend Sec.  2807.17 by redesignating existing paragraph (d) as 
paragraph (e) and adding new paragraph (d) to read as follows:


Sec.  2807.17  Under what conditions may the BLM suspend or terminate 
my grant?

* * * * *
    (d) The BLM may suspend or terminate another Federal agency's grant 
only if:
    (1) The terms and conditions of the Federal agency's grant allow 
it; or
    (2) The agency head holding the grant consents to it.
* * * * *
0
48. Amend Sec.  2807.21 as follows:
0
a. Revise the section heading;
0
b. Revise paragraph (a);
0
c. Redesignate paragraphs (b), (c), (d) and (e) as paragraphs (d), (e), 
(f) and (g);
0
d. Add paragraphs (b), (c), (h), and (i); and
0
e. Revise redesignated paragraphs (d) and (f).
    The revisions and additions read as follows:


Sec.  2807.21  May I assign or make other changes to my grant or lease?

    (a) With the BLM's approval, you may assign, in whole or in part, 
any right or interest in a grant or lease. Actions that may require an 
assignment include, but are not limited to, the following:
    (1) The voluntary transfer by the holder (assignor) of any right or 
interest in the grant or lease to a third party (assignee); and
    (2) Changes in ownership or other related change in control 
transactions involving the BLM right-of-way holder and another business 
entity (assignee), including corporate mergers or acquisitions. In 
those instances where the grant or lease holder becomes a wholly owned 
subsidiary of a new third party, but still holds the grant and does 
business under its original name, it may only need to file new or 
revised information in conformance with subpart 2803, Sec.  2804.12(b), 
and Sec.  2807.11 in order to obtain our approval of the change in the 
grant or lease.
    (b) Changes in the holder's name only (see paragraph (i) of this 
section) do not constitute an assignment.
    (c) Changes in the holder's articles of incorporation do not 
constitute an assignment.
    (d) In order to assign a grant, the proposed assignee must file an 
assignment application and follow the same procedures and standards as 
for a new grant or lease, including paying application and processing 
fees, and the grant must be in compliance with the terms and conditions 
of Sec.  2805.12. We will not approve any assignment until the assignor 
makes any outstanding payments that are due (see Sec.  2806.13(g)).
* * * * *
    (f) We will not recognize an assignment until we approve it in 
writing. We will approve the assignment if doing so is in the public 
interest. Except for leases issued under subpart 2809 of this part, we 
may modify the grant or lease or add bonding and other requirements, 
including additional terms and conditions, to the grant when approving 
the assignment. We may decrease rents if the new holder qualifies for 
an exemption (see Sec.  2806.14), or waiver or reduction (see Sec.  
2806.15) and the previous holder did not. Similarly, we may increase 
rents if the previous holder qualified for an exemption or waiver or 
reduction and the new holder does not. If we approve the assignment, 
the benefits and liabilities of the grant apply to the new grant or 
lease holder.
* * * * *
    (h) Only interests in issued right-of-way grants and leases are 
assignable. Pending right-of-way applications do not create any 
property rights or other interest and may not be assigned from one 
entity to another, except that an entity with a pending application may 
continue to pursue that application even if that entity becomes a 
wholly owned subsidiary of a new third party.
    (i) To complete a change in name only, (i.e., when the name change 
in question is not the result of an underlying change in control of the 
right-of-way grant), the following requirements must be met:
    (1) The holder must file an application requesting a name change 
and follow the same procedures as for a new grant, including paying 
processing fees, but not application fees (see subpart 2804 of this 
part). The name change request must include:
    (i) If the name change is for an individual, a copy of the court 
order or other legal document effectuating the name change; or
    (ii) If the name change is for a corporation, a copy of the 
corporate resolution(s) proposing and approving the name change, a copy 
of the acceptance of the change in name by the State or Territory in 
which incorporated, and a copy of the appropriate resolution, order or 
other documentation showing the name change.
    (2) In connection with its processing of a name change only, we 
may, under Sec.  2805.15, modify the grant or lease or add bonding and 
other requirements, including additional terms and conditions to the 
grant. We may only modify a lease issued under subpart 2809 in 
accordance with Sec.  2805.15(e).
    (3) We will recognize a name change in writing.
0
49. Amend Sec.  2807.22 by:
0
a. Revising the section heading and paragraphs (a), (b), and (d);
0
b. Redesignating paragraph (f) as paragraph (g); and
0
c. Adding new paragraph (f).
    The revisions and additions read as follows:


Sec.  2807.22  How do I renew my grant or lease?

    (a) If your grant or lease specifies the terms and conditions for 
its renewal, and you choose to renew it, you must request a renewal 
from the BLM at least 120 calendar days before your grant or lease 
expires consistent with the

[[Page 59079]]

renewal terms and conditions specified in your grant or lease. We will 
renew the grant or lease if you are in compliance with the renewal 
terms and conditions; the other terms, conditions, and stipulations of 
the grant or lease; and other applicable laws and regulations.
    (b) If your grant or lease does not specify the terms and 
conditions for its renewal, you may apply to us to renew the grant or 
lease. You must send us your application at least 120 calendar days 
before your grant or lease expires. In your application you must show 
that you are in compliance with the terms, conditions, and stipulations 
of the grant or lease and other applicable laws and regulations, and 
explain why a renewal of your grant or lease is necessary. We may 
approve or deny your application to renew your grant or lease.
* * * * *
    (d) We will review your application and determine the applicable 
terms and conditions of any renewed grant or lease.
* * * * *
    (f) If you make timely and sufficient application for a renewal of 
your existing grant or lease, or for a new grant or lease in accordance 
with this section, the existing grant does not expire until we have 
issued a decision to approve or deny the application.
* * * * *
0
50. Revise subpart 2809 to read as follows:

Subpart 2809--Competitive Process for Leasing Public Lands for 
Solar and Wind Energy Development Inside Designated Leasing Areas

Sec.
2809.10 General.
2809.11 How will BLM solicit nominations?
2809.12 How will BLM select and prepare parcels?
2809.13 How will BLM conduct competitive offers?
2809.14 What types of bids are acceptable?
2809.15 How will BLM select the successful bidder?
2809.16 When do variable offsets apply?
2809.17 Will BLM ever reject bids or re-conduct a competitive offer?
2809.18 What terms and conditions apply to leases?
2809.19 Applications in designated leasing areas, or on lands that 
later become designated leasing areas.

Subpart 2809--Competitive Process for Leasing Public Lands for 
Solar and Wind Energy Development Inside Designated Leasing Areas


Sec.  2809.10  General.

    (a) Lands inside designated leasing areas may be made available for 
solar and wind energy development through a competitive leasing offer 
process established by the BLM under this subpart.
    (b) The BLM may include lands in a competitive offer on its own 
initiative.
    (c) The BLM may solicit nominations by publishing a call for 
nominations under Sec.  2809.11(b).


Sec.  2809.11  How will BLM solicit nominations?

    (a) Call for nominations. The BLM will publish a notice in a 
newspaper of general circulation in the area affected by the potential 
offer of public land for solar and wind energy development; use other 
notification methods, including the Internet; and publish a notice in 
the Federal Register to solicit nominations and expressions of interest 
for parcels of land inside designated leasing areas for solar or wind 
energy development.
    (b) Nomination submission. A nomination must be in writing and must 
include the following:
    (1) Nomination fee. If you nominate a specific parcel of land under 
paragraph (a) of this section, you must also include a non-refundable 
nomination fee of $5 per acre. We will adjust the nomination fee once 
every 10 years by the average annual change in the IPD-GDP for the 
preceding 10-year period and round it to the nearest half dollar. This 
10 year average will be adjusted at the same time as the Per Acre Rent 
Schedule for linear rights-of-way under Sec.  2806.22.
    (2) Nominator's name and personal or business address. The name of 
only one citizen, association, partnership, corporation, or 
municipality may appear as the nominator. All communications relating 
to leasing will be sent to that name and address, which constitutes the 
nominator's name and address of record.
    (3) The legal land description and a map of the nominated lands.
    (c) We may consider informal expressions of interest suggesting 
lands to be included in a competitive offer. If you submit a written 
expression of interest, you must provide a description of the suggested 
lands and rationale for their inclusion in a competitive offer.
    (d) In order to submit a nomination, you must be qualified to hold 
a grant or lease under Sec.  2803.10.
    (e) Nomination withdrawals. A nomination cannot be withdrawn, 
except by the BLM for cause, in which case all nomination monies will 
be refunded to the nominator.


Sec.  2809.12  How will BLM select and prepare parcels?

    (a) The BLM will identify parcels for competitive offer based on 
nominations and expressions of interest or on its own initiative.
    (b) The BLM and other Federal agencies will conduct necessary 
studies and site evaluation work, including applicable environmental 
reviews and public meetings, before offering lands competitively.


Sec.  2809.13  How will BLM conduct competitive offers?

    (a) Variety of competitive procedures available. The BLM may use 
any type of competitive process or procedure to conduct its competitive 
offer, and any method, including the use of the Internet, to conduct 
the actual auction or competitive bid procedure. Possible bid 
procedures could include, but are not limited to: Sealed bidding, oral 
auctions, modified competitive bidding, electronic bidding, or any 
combination thereof.
    (b) Notice of competitive offer. We will publish a notice in a 
newspaper of general circulation in the area affected by the potential 
right-of-way; use other notification methods, including the Internet; 
and publish a notice in the Federal Register at least 30 days prior to 
the competitive offer. The newspaper and Federal Register notices will 
include:
    (1) The date, time, and location, if any, of the competitive offer;
    (2) The legal land description of the parcel to be offered;
    (3) The bidding methodology and procedures to be used in conducting 
the competitive offer, which may include any of the competitive 
procedures identified in paragraph (a) of this section;
    (4) The minimum bid required (see Sec.  2809.14(a)), including an 
explanation of how we determined this amount;
    (5) The qualification requirements of potential bidders (see Sec.  
2803.10);
    (6) If a variable offset (see Sec.  2809.16) is offered;
    (i) The percent of each offset;
    (ii) How bidders may pre-qualify for each offset; and
    (iii) The documentation required to pre-qualify for each offset; 
and
    (7) The terms and conditions of the lease, including the 
requirements for the successful bidder to submit a POD for the lands 
involved in the competitive offer (see Sec.  2809.18) and the lease 
mitigation requirements.
    (c) We will notify you in writing of our decision to conduct a 
competitive offer at least 30 days prior to the competitive offer if 
you nominated lands and paid the nomination fees required by Sec.  
2809.11(b)(1).

[[Page 59080]]

Sec.  2809.14  What types of bids are acceptable?

    (a) Bid submissions. The BLM will accept your bid only if:
    (1) It includes the minimum bid and at least 20 percent of the 
bonus bid; and
    (2) The BLM determines that you are qualified to hold a grant under 
Sec.  2803.10. You must include documentation of your qualifications 
with your bid, unless we have previously approved your qualifications 
under Sec. Sec.  2809.10(d) or 2809.11(d).
    (b) Minimum bid. The minimum bid is not prorated among all bidders, 
but must be paid entirely by the successful bidder. The minimum bid 
consists of:
    (1) The administrative costs incurred by the BLM and other Federal 
agencies in preparing for and conducting the competitive offer, 
including required environmental reviews; and
    (2) An amount determined by the authorized officer and disclosed in 
the notice of competitive offer. This amount will be based on known or 
potential values of the parcel. In setting this amount, the BLM will 
consider factors that include, but are not limited to, the acreage 
rent, megawatt capacity fee, and mitigation costs.
    (c) Bonus bid. The bonus bid consists of any dollar amount that a 
bidder wishes to bid in addition to the minimum bid.
    (d) If you are not the successful bidder, as defined in Sec.  
2809.15(a), the BLM will refund your bid.


Sec.  2809.15  How will BLM select the successful bidder?

    (a) The bidder with the highest total bid, prior to any variable 
offset, is the successful bidder and will be offered a lease in 
accordance with Sec.  2805.10.
    (b) The BLM will determine the variable offsets for the successful 
bidder in accordance with Sec.  2809.16 before issuing final payment 
terms.
    (c) Payment terms. If you are the successful bidder, you must:
    (1) Make payments by personal check, cashier's check, certified 
check, bank draft, or money order, or by other means deemed acceptable 
by the BLM, payable to the Department of the Interior--Bureau of Land 
Management; and
    (2) By the close of official business hours on the day of the offer 
or such other time as the BLM may have specified in the offer notices, 
submit for each parcel:
    (i) Twenty percent of the bonus bid (before the offsets are applied 
under paragraph (b) of this section);
    (ii) The total amount of the minimum bid specified in Sec.  
2809.14(b); and
    (3) Within 15 calendar days after the day of the offer, submit the 
balance of the bonus bid (after the variable offsets are applied under 
paragraph (b) of this section) to the BLM office conducting the offer; 
and
    (4) Within 15 calendar days after the day of the offer, submit the 
acreage rent for the first full year of the solar or wind energy 
development lease as provided in Sec. Sec.  2806.54(a) or 2806.64(a), 
respectively. This amount will be applied toward the first 12 months 
acreage rent, if the successful bidder becomes the lessee.
    (d) The BLM will approve your right-of-way lease if you are the 
successful bidder and:
    (1) Satisfy the qualifications in Sec.  2803.10;
    (2) Make the payments required under paragraph (c) of this section; 
and
    (3) Do not have any trespass action pending against you for any 
activity on BLM-administered lands (see Sec.  2808.12) or have any 
unpaid debts owed to the Federal Government.
    (e) The BLM will not offer a lease to the successful bidder and 
will keep all money that has been submitted, if the successful bidder 
does not satisfy the requirements of Sec.  paragraph (d) of this 
section. In this case, the BLM may offer the lease to the next highest 
bidder under Sec.  2809.17(b) or re-offer the lands under Sec.  
2809.17(d).


Sec.  2809.16  When do variable offsets apply?

    (a) The successful bidder may be eligible for an offset of up to 20 
percent of the bonus bid based on the factors identified in the notice 
of competitive offer.
    (b) The BLM may apply a variable offset to the bonus bid of the 
successful bidder. The notice of competitive offer will identify each 
factor of the variable offset, the specific percentage for each factor 
that would be applied to the bonus bid, and the documentation required 
to be provided to the BLM prior to the day of the offer to qualify for 
the offset. The total variable offset cannot be larger than 20 percent 
of the bonus bid.
    (c) The variable offset may be based on any of the following 
factors:
    (1) Power purchase agreement;
    (2) Large generator interconnect agreement;
    (3) Preferred solar or wind energy technologies;
    (4) Prior site testing and monitoring inside the designated leasing 
area;
    (5) Pending applications inside the designated leasing area;
    (6) Submission of nomination fees;
    (7) Timeliness of project development, financing, and economic 
factors;
    (8) Environmental benefits;
    (9) Holding a solar or wind energy lease on adjacent or mixed land 
ownership;
    (10) Public benefits; and
    (11) Other similar factors.
    (d) The BLM will determine your variable offset prior to the 
competitive offer.


Sec.  2809.17  Will BLM ever reject bids or re-conduct a competitive 
offer?

    (a) The BLM may reject bids regardless of the amount offered. If 
the BLM rejects your bid under this provision, you will be notified in 
writing and such notice will include the reason(s) for the rejection 
and what refunds to which you are entitled. If the BLM rejects a bid, 
the bidder may appeal that decision under Sec.  2801.10.
    (b) We may offer the lease to the next highest qualified bidder if 
the successful bidder does not execute the lease or is for any reason 
disqualified from holding the lease.
    (c) If we are unable to determine the successful bidder, such as in 
the case of a tie, we may re-offer the lands competitively (under Sec.  
2809.13) to the tied bidders, or to all prospective bidders.
    (d) If lands offered under Sec.  2809.13 receive no bids, we may:
    (1) Re-offer the lands through the competitive process under Sec.  
2809.13; or
    (2) Make the lands available through the non-competitive 
application process found in subparts 2803, 2804, and 2805 of this 
part, if we determine that doing so is in the public interest.


Sec.  2809.18  What terms and conditions apply to leases?

    The lease will be issued subject to the following terms and 
conditions:
    (a) Lease term. The term of your lease includes the initial partial 
year in which it is issued, plus 30 additional full years. The lease 
will terminate on December 31 of the final year of the lease term. You 
may submit an application for renewal under Sec.  2805.14(g).
    (b) Rent. You must pay rent as specified in:
    (1) Section 2806.54 if your lease is for solar energy development; 
or
    (2) Section 2806.64 if your lease is for wind energy development.
    (c) POD. You must submit, within 2 years of the lease issuance 
date, a POD that:
    (1) Is consistent with the development schedule and other 
requirements in the POD template posted at http://www.blm.gov; and
    (2) Addresses all pre-development and development activities.
    (d) Cost recovery. You must pay the reasonable costs for the BLM or 
other

[[Page 59081]]

Federal agencies to review and approve your POD and to monitor your 
lease. To expedite review of your POD and monitoring of your lease, you 
may notify BLM in writing that you are waiving paying reasonable costs 
and are electing to pay the full actual costs incurred by the BLM.
    (e) Performance and reclamation bond. (1) For Solar Energy 
Development, you must provide a bond in the amount of $10,000 per acre 
prior to written approval to proceed with ground disturbing activities.
    (2) For Wind Energy Development, you must provide a bond in the 
amount of $20,000 per authorized turbine prior to written approval to 
proceed with ground disturbing activities.
    (3) The BLM will adjust the solar and wind energy development bond 
amounts every 10 years by the average annual change in the IPD-GDP for 
the preceding 10-year period rounded to the nearest $100. This 10-year 
average will be adjusted at the same time as the Per Acre Rent Schedule 
for linear rights-of-way under Sec.  2806.22.
    (f) Assignments. You may assign your lease under Sec.  2807.21, and 
if an assignment is approved, the BLM will not make any changes to the 
lease terms or conditions, as provided for by Sec.  2807.21(f).
    (g) Due diligence of operations. You must start construction within 
5 years and begin generation of electricity no later than 7 years from 
the date of lease issuance, as specified in your approved POD. A 
request for an extension may be granted for up to 3 years with a show 
of good cause and approval by the BLM.


Sec.  2809.19  Applications in designated leasing areas, or on lands 
that later become designated leasing areas.

    (a) Applications for solar or wind energy development filed on 
lands outside of designated leasing areas, which subsequently become 
designated leasing areas:
    (1) Will continue to be processed by the BLM and are not subject to 
the competitive leasing offer process of this subpart, if such 
applications are filed prior to the publication of the notice of 
availability of the draft or proposed land use plan amendment to 
designate the solar or wind leasing area; or
    (2) Will remain in pending status unless withdrawn by the applicant 
or denied by the BLM, or the subject lands become available for 
application or leasing under this part, if such applications are filed 
on or after the date of publication of the notice of availability of 
the draft or proposed land use plan amendment to designate the solar or 
wind leasing area. An applicant that submits a bid on a parcel of land 
for which an application is pending:
    (i) May qualify for a variable offset under Sec.  2809.16; and
    (ii) Will not receive a refund for any application fees or 
processing costs incurred if the lands identified in the application 
are subsequently leased to another entity under Sec.  2809.12.
    (b) After the effective date of this regulation, the BLM will not 
accept a new application for solar or wind energy development inside 
designated leasing areas (see Sec.  2804.10(c)(2)).
    (c) You may file a new application under part 2804 for testing and 
monitoring purposes inside designated leasing areas. If the BLM 
approves your application, you will receive a short term grant in 
accordance with Sec. Sec.  2805.11(b)(2)(i) or (ii), which may qualify 
you for an offset under Sec.  2809.16.

PART 2880--RIGHTS-OF-WAY UNDER THE MINERAL LEASING ACT

0
51. The authority citation for part 2880 continues to read as follows:

    Authority: 30 U.S.C. 185 and 189.

Subpart 2884--Applying for MLA Grants or TUPs

0
52. Amend Sec.  2884.10 by:
0
a. Revising the introductory text in paragraph (b) and revising 
paragraph (b)(4);
0
b. Redesignating paragraphs (c) and (d) as paragraphs (e) and (f); and
0
c. Adding new paragraphs (c) and (d).
    The revisions and additions read as follows:


Sec.  2884.10  What should I do before I file my application?

* * * * *
    (b) Before filing an application with the BLM, we encourage you to 
make an appointment for a pre-application meeting with the appropriate 
personnel in the BLM state, district, or field office nearest the lands 
you seek to use. Pre-application meetings are mandatory for 
applications for any oil and gas pipeline 10 inches or more in diameter 
under paragraph (c) of this section. During the pre-application meeting 
the BLM can:
* * * * *
    (4) Provide you information about qualifications for holding grants 
and TUPs and inform you of your financial obligations, such as 
processing and monitoring costs and rents. In addition to such costs, 
you are required to pay the reasonable costs, and may elect to pay the 
actual costs that are associated with the pre-application requirements 
identified in paragraph (c) of this section; and
* * * * *
    (c) Prior to submitting an application for any oil and gas pipeline 
10 inches or more in diameter, you must:
    (1) Schedule and hold an initial pre-application meeting with us to 
discuss:
    (i) The general project proposal;
    (ii) The status of BLM land use planning for the lands involved;
    (iii) Potential siting issues or concerns;
    (iv) Potential environmental issues or concerns at the landscape 
scale;
    (v) Potential alternative site locations; and
    (vi) The right-of-way application process;
    (2) Schedule and hold, in coordination with the BLM, one additional 
pre-application meeting with appropriate Federal and State agencies, 
tribal, and local governments to facilitate coordination of potential 
environmental and siting issues and concerns. The BLM and you may agree 
mutually to schedule and hold additional pre-application meetings; and
    (3) Initiate early discussions with grazing permittees that may be 
affected by the proposed project in accordance with 43 CFR 4110.4-2(b).
    (d) In addition to all other pre-application, application, and 
holder requirements specified in this part, we will accept an 
application for oil and gas pipelines 10 inches or more in diameter 
only if the:
    (1) Proposal avoids areas where development could cause significant 
impacts to sensitive resources and values that are the basis for 
special designations or protections;
    (2) The pre-application meetings described in paragraphs (c)(1) and 
(2) of this section have been completed to our satisfaction; and
    (3) Application is accompanied by a general description of the 
proposed project and a schedule for the submittal of a POD conforming 
to the POD template at http://www.blm.gov.
0
53. In Sec.  2884.11, revise paragraph (c)(5) to read as follows:


Sec.  2884.11  What information must I submit in my application?

* * * * *
    (c) * * *
    (5) The estimated schedule for constructing, operating, 
maintaining, and terminating the project (a POD). Your POD must be 
consistent with the development schedule and other requirements as 
noted on the POD template for oil and gas pipelines at http://www.blm.gov;
* * * * *

[[Page 59082]]

0
54. In Sec.  2884.12, revise paragraphs (a), (b), and (c) to read as 
follows:


Sec.  2884.12  What is the processing fee for a grant or TUP 
application?

    (a) You must pay a processing fee with the application to cover the 
costs to the Federal Government of processing your application before 
the Federal Government incurs them. Subject to applicable laws and 
regulations, if processing your application will involve Federal 
agencies other than the BLM, your fee may also include the reasonable 
costs estimated to be incurred by those Federal agencies. Instead of 
paying the BLM a fee for the estimated work of other Federal agencies 
in processing your application, you may pay other Federal agencies 
directly for the costs estimated to be incurred by them in processing 
your application. The fees for Processing Categories 1 through 4 are 
one-time fees and are not refundable. The fees are categorized based on 
an estimate of the amount of time that the Federal Government will 
expend to process your application and issue a decision granting or 
denying the application.
    (b) There is no processing fee if work is estimated to take 1 hour 
or less. Processing fees are based on categories. We update the 
processing fees for Categories 1 through 4 in the schedule each 
calendar year, based on the previous year's change in the IPD-GDP, as 
measured second quarter to second quarter. We will round these changes 
to the nearest dollar. We will update Category 5 processing fees as 
specified in the Master Agreement. These processing categories and the 
estimated range of Federal work hours for each category are:

                          Processing Categories
------------------------------------------------------------------------
            Processing category              Federal work hours involved
------------------------------------------------------------------------
(1) Applications for new grants or TUPs,     Estimated Federal work
 assignments, renewals, and amendments to     hours are >1 <=8.
 existing grants or TUPs.
(2) Applications for new grants or TUPs,     Estimated Federal work
 assignments, renewals, and amendments to     hours are >8 <=24.
 existing grants or TUPs.
(3) Applications for new grants or TUPs,     Estimated Federal work
 assignments, renewals, and amendments to     hours are >24 <=36.
 existing grants or TUPs.
(4) Applications for new grants or TUPs,     Estimated Federal work
 assignments, renewals, and amendments to     hours are >36 <=50.
 existing grants or TUPs.
(5) Master Agreements......................  Varies.
(6) Applications for new grants or TUPs,     Estimated Federal work
 assignments, renewals, and amendments to     hours are >50.
 existing grants or TUPs.
------------------------------------------------------------------------

    (c) You may obtain a copy of the current schedule from any BLM 
state, district, or field office or by writing: U.S. Department of the 
Interior, Bureau of Land Management, 20 M Street SE., Room 2134LM, 
Washington, DC 20003. The BLM also posts the current schedule at http://www.blm.gov.
* * * * *
0
55. Amend Sec.  2884.16 by redesignating paragraphs (a)(6), (a)(7), and 
(a)(8) as paragraphs (a)(7), (a)(8), and (a)(9), and adding new 
paragraph (a)(6). The addition reads as follows:


Sec.  2884.16  What provisions do Master Agreements contain and what 
are their limitations?

    (a) * * *
    (6) Describes existing agreements between the BLM and other Federal 
agencies for cost reimbursement;
* * * * *
0
56. Amend Sec.  2884.17 by revising paragraph (a) and adding new 
paragraph (e) to read as follows:


Sec.  2884.17  How will BLM process my Processing Category 6 
application?

    (a) For Processing Category 6 applications, you and the BLM must 
enter into a written agreement that describes how we will process your 
application. The final agreement consists of a work plan, a financial 
plan, and a description of any existing agreements you have with other 
Federal agencies for cost reimbursement associated with such 
application.
* * * * *
    (e) We may collect funds to reimburse the Federal Government for 
reasonable costs for processing applications and other documents under 
this part relating to the Federal lands.
0
57. In Sec.  2884.18, revise revising paragraphs (a)(1) and (c) to read 
as follows:


Sec.  2884.18  What if there are two or more competing applications for 
the same pipeline?

    (a) * * *
    (1) Processing Categories 1 through 4. You must reimburse the 
Federal Government for processing costs as if the other application or 
applications had not been filed.
* * * * *
    (c) If we determine that competition exists, we will describe the 
procedures for a competitive bid through a bid announcement in a 
newspaper of general circulation; use other notification methods, 
including the Internet, in the area affected by the potential right-of-
way; and by publishing a notice in the Federal Register. We may offer 
lands through a competitive process on our own initiative.
0
58. Amend Sec.  2884.20 by revising the introductory text of paragraph 
(a) and revising paragraph (d) to read as follows:


Sec.  2884.20  What are the public notification requirements for my 
application?

    (a) When the BLM receives your application, it will publish a 
notice in the Federal Register, a newspaper of general circulation in 
the vicinity of the lands involved, or use other notification methods, 
including the Internet. If we determine the pipeline(s) will have only 
minor environmental impacts, we are not required to publish this 
notice. The notice will, at a minimum, contain:
* * * * *
    (d) We may hold public hearings or meetings on your application if 
we determine that there is sufficient interest to warrant the time and 
expense of such hearings or meetings. We will publish a notice in the 
Federal Register, in a newspaper of general circulation in the vicinity 
of the lands involved, or use other notification methods, including the 
Internet, to announce in advance any public hearings or meetings.
0
59. Amend Sec.  2884.21 by:
0
a. Redesignating paragraphs (b) and (c) as paragraphs (c) and (d);
0
b. Adding new paragraph (b); and
0
c. Revising redesignated paragraph (d)(4).
    The revisions and additions read as follows:

[[Page 59083]]

Sec.  2884.21  How will BLM process my application?

* * * * *
    (b) Except as otherwise provided in this paragraph, the BLM will 
not process your application if you have any trespass action pending 
for any activity on BLM-administered lands (see Sec.  2888.11) or have 
any unpaid debts owed to the Federal Government. The only applications 
the BLM would process to resolve the trespass would be for a right-of-
way as authorized in this part, or a lease or permit under the 
regulations found at 43 CFR part 2920, but only after outstanding debts 
are paid.
* * * * *
    (d) * * *
    (4) Hold public meetings, if sufficient public interest exists to 
warrant their time and expense. The BLM will publish a notice in the 
Federal Register, in a newspaper of general circulation in the vicinity 
of the lands involved, or use other methods, including the Internet, to 
announce in advance any public hearings or meetings; and
* * * * *
0
60. Amend Sec.  2884.23 by redesignating paragraph (a)(6) as paragraph 
(a)(7), adding new paragraph (a)(6), and revising newly redesignated 
paragraph (a)(7) to read as follows:


Sec.  2884.23  Under what circumstances may BLM deny my application?

    (a) * * *
    (6) The POD required by Sec. Sec.  2884.10(d)(3) and 2884.11(c)(5) 
does not meet the development schedule and other requirements as noted 
on the POD template and the applicant is unable to demonstrate why the 
POD should be approved; or
    (7) You do not adequately comply with a deficiency notice (see 
Sec.  2804.25(b) of this chapter) or with any requests from the BLM for 
additional information needed to process the application.
* * * * *
0
61. Amend Sec.  2884.24 by revising the first sentence of the 
introductory text to read as follows:


Sec.  2884.24  What fees do I owe if BLM denies my application or if I 
withdraw my application?

    If the BLM denies your application, or you withdraw it, you must 
pay costs incurred under Sec.  2884.10(b)(4) and the processing fee set 
forth at Sec.  2884.12(b), unless you have a Processing Category 5 or 6 
application.* * *
* * * * *
0
62. Amend Sec.  2885.11 by revising the introductory text of paragraph 
(a) and revising paragraph (b)(7) to read as follows:


Sec.  2885.11  What terms and conditions must I comply with?

    (a) Duration. All grants, except those issued for a term of 3 years 
or less, will expire on December 31 of the final year of the grant. The 
term of a grant may not exceed 30 years, with the initial partial year 
of the grant considered to be the first year of the term. The term of a 
TUP may not exceed 3 years. The BLM will consider the following factors 
in establishing a reasonable term:
* * * * *
    (b) * * *
    (7) If we require, obtain or certify that you have obtained a 
performance and reclamation bond or other acceptable security to cover 
any losses, damages, or injury to human health, the environment, and 
property incurred in connection with your use and occupancy of the 
right-of-way or TUP area, including terminating the grant or TUP, and 
to secure all obligations imposed by the grant or TUP and applicable 
laws and regulations. Your bond must cover liability for damages or 
injuries resulting from releases or discharges of hazardous materials. 
We may require a bond, an increase or decrease in the value of an 
existing bond, or other acceptable security at any time during the term 
of the grant or TUP. This bond is in addition to any individual lease, 
statewide, or nationwide oil and gas bonds you may have. All other 
provisions noted at Sec.  2805.12(b) of this chapter regarding bond 
requirements for grants and leases issued under FLPMA also apply to oil 
and gas pipelines issued under this part;
* * * * *
0
63. Amend Sec.  2885.15 by revising paragraph (b) to read as follows:


Sec.  2885.15  How will BLM charge me rent?

* * * * *
    (b) There are no reductions or waivers of rent for grants or TUPs, 
except as provided under Sec.  2885.20(b).
* * * * *
0
64. Amend Sec.  2885.16 by revising paragraph (a) to read as follows:


Sec.  2885.16  When do I pay rent?

    (a) You must pay rent for the initial rental period before we issue 
you a grant or TUP. We prorate the initial rental amount based on the 
number of full months left in the calendar year after the effective 
date of the grant or TUP. If your grant qualifies for annual payments, 
the initial rent consists of the remaining partial year plus the next 
full year. If your grant or TUP allows for multi-year payments, your 
initial rent payment may be for the full term of the grant or TUP. See 
Sec.  2885.21 for additional information on payment of rent.
* * * * *
0
65. Amend Sec.  2885.17 by revising the section heading, redesignating 
paragraph (e) as paragraph (f), and by adding new paragraph (e) to read 
as follows:


Sec.  2885.17  What happens if I do not pay rent or if I pay the rent 
late?

* * * * *
    (e) We will retroactively bill for uncollected or under-collected 
rent, including late payment and administrative fees, upon discovery 
if:
    (1) A clerical error is identified;
    (2) An adjustment to rental schedules is not applied; or
    (3) An omission or error in complying with the terms and conditions 
of the authorized right-of-way is identified.
* * * * *
0
66. In Sec.  2885.19, revise paragraph (b) to read as follows:


Sec.  2885.19  What is the rent for a linear right-of-way grant?

* * * * *
    (b) You may obtain a copy of the current Per Acre Rent Schedule 
from any BLM state, district, or field office or by writing: U.S. 
Department of the Interior, Bureau of Land Management, 20 M Street SE., 
Room 2134LM, Washington, DC 20003. The BLM also posts the current rent 
schedule at http://www.blm.gov.
0
67. In Sec.  2885.20, revise paragraph (b) to read as follows:


Sec.  2885.20  How will the BLM calculate my rent for linear rights-of-
way the Per Acre Rent Schedule covers?

    (a) * * *
    (b) Phase-in provisions: If, as the result of any revisions made to 
the Per Acre Rent Schedule under Sec.  2885.19(a)(2), the payment of 
your new annual rental amount would cause you undue hardship, you may 
qualify for a 2-year phase-in period if you are a small business entity 
as that term is defined in Small Business Administration regulations 
and if it is in the public interest. We will require you to submit 
information to support your claim. If approved by the BLM State 
Director, payment of the amount in excess of the previous year's rent 
may be phased-in by equal increments over a 2-year period. In addition, 
the BLM will adjust the total calculated rent for year 2 of the phase-
in period by the annual index provided by Sec.  2885.19(a)(1).
* * * * *

[[Page 59084]]

0
68. Revise Sec.  2885.24 to read as follows:


Sec.  2885.24  If I hold a grant or TUP, what monitoring fees must I 
pay?

    (a) Monitoring fees. Subject to Sec.  2886.11, you must pay a fee 
to the BLM for any costs the Federal Government incurs in monitoring 
the construction, operation, maintenance, and termination of the 
pipeline and protection and rehabilitation of the affected public lands 
your grant or TUP covers. We update the monitoring fees for Categories 
1 through 4 in the schedule each calendar year, based on the previous 
year's change in the IPD-GDP, as measured second quarter to second 
quarter. We will round these changes to the nearest dollar. We will 
update Category 5 monitoring fees as specified in the Master Agreement. 
We categorize the monitoring fees based on the estimated number of work 
hours necessary to monitor your grant or TUP. Monitoring fees for 
Categories 1 through 4 are one-time fees and are not refundable. These 
monitoring categories and the estimated range of Federal work hours for 
each category are:

                          Monitoring Categories
------------------------------------------------------------------------
            Monitoring category              Federal work hours involved
------------------------------------------------------------------------
(1) Applications for new grants and TUPs,    Estimated Federal work
 assignments, renewals, and amendments to     hours are >1 <=8.
 existing grants and TUPs.
(2) Applications for new grants and TUPs,    Estimated Federal work
 assignments, renewals, and amendments to     hours are >8 <=24.
 existing grants and TUPs.
(3) Applications for new grants and TUPs,    Estimated Federal work
 assignments, renewals, and amendments to     hours are >24 <=36.
 existing grants and TUPs.
(4) Applications for new grants and TUPs,    Estimated Federal work
 assignments, renewals, and amendments to     hours are >36 <=50.
 existing grants and TUPS.
(5) Master Agreements......................  Varies.
(6) Applications for new grants and TUPs,    Estimated Federal work
 assignments, renewals, and amendments to     hours >50.
 existing grants and TUPs.
------------------------------------------------------------------------

    (b) The current monitoring cost schedule is available from any BLM 
state, district, or field office or by writing: U.S. Department of the 
Interior, Bureau of Land Management, 20 M Street SE., Room 2134LM, 
Washington, DC 20003. The BLM also posts the current schedule at http://www.blm.gov.
0
69. Amend Sec.  2886.12 by:
0
a. Revising paragraph (b);
0
b. Redesignating paragraph (d) as paragraph (g); and
0
c. Adding new paragraphs (d), (e), and (f).
    The revisions and additions read as follows:


Sec.  2886.12  When must I contact BLM during operations?

* * * * *
    (b) When your use requires a substantial deviation from the grant 
or TUP. You must seek an amendment to your grant or TUP under Sec.  
2887.10 and obtain our approval before you begin any activity that is a 
substantial deviation;
* * * * *
    (d) Whenever site-specific circumstances or conditions arise that 
result in the need for changes to an approved right-of-way grant or 
TUP, POD, site plan, mitigation measures, or construction, operation, 
or termination procedures that are not substantial deviations in 
location or use authorized by a right-of-way grant or TUP. Changes for 
authorized actions, project materials, or adopted mitigation measures 
within the existing, approved right-of-way or TUP area must be 
submitted to the BLM for review and approval;
    (e) To identify and correct discrepancies or inconsistencies;
    (f) When you submit a certification of construction, if the terms 
of your grant require it. A certification of construction is a document 
you submit to the BLM after you have finished constructing a facility, 
but before you begin operating it, verifying that you have constructed 
and tested the facility to ensure that it complies with the terms of 
the grant and with applicable Federal and State laws and regulations; 
and
* * * * *

Subpart 2887--Amending, Assigning, or Renewing MLA Grants and TUPs

0
70. Revise Sec.  2887.11 to read as follows:


Sec.  2887.11  May I assign or make other changes to my grant or TUP?

    (a) With the BLM's approval, you may assign, in whole or in part, 
any right or interest in a grant or TUP. Actions that may require an 
assignment include, but are not limited to, the following:
    (1) The voluntary transfer by the holder (assignor) of any right or 
interest in the grant or TUP to a third party (assignee); and
    (2) Changes in ownership or other related change in control 
transactions involving the BLM right-of-way grant holder or TUP holder 
and another business entity (assignee), including corporate mergers or 
acquisitions. In those instances where the grant or TUP holder becomes 
a wholly owned subsidiary of a new third party, but still holds the 
grant or TUP and does business under its original name, it may only 
need to file new or revised information in conformance with subpart 
2883, Sec. Sec.  2884.11(c) and 2886.12 in order to obtain the BLM's 
approval of the changes in the grant or TUP.
    (b) Changes in the holder's name only (see paragraph (i) of this 
section) do not constitute an assignment.
    (c) Changes in the holder's articles of incorporation do not 
constitute an assignment.
    (d) In order to assign a grant or TUP, the proposed assignee, 
subject to Sec.  2886.11, must file an application and follow the same 
procedures and standards as for a new grant or TUP, including paying 
processing fees (see Sec.  2884.12).
    (e) The assignment application must also include:
    (1) Documentation that the assignor agrees to the assignment; and
    (2) A signed statement that the proposed assignee agrees to comply 
with and to be bound by the terms and conditions of the grant or TUP 
that is being assigned and all applicable laws and regulations.
    (f) We will not recognize an assignment until we approve it in 
writing. We will approve the assignment if doing so is in the public 
interest. The BLM may modify the grant or TUP or add bonding and other 
requirements, including terms and conditions, to the grant or TUP when 
approving the assignment. If we approve the assignment, the benefits 
and liabilities of the grant or TUP apply to the new grant or TUP 
holder.

[[Page 59085]]

    (g) The processing time and conditions described at Sec.  2884.21 
apply to assignment applications.
    (h) Only interests in issued right-of-way grants and TUPs are 
assignable. Pending right-of-way and TUP applications do not create any 
property rights or other interest and may not be assigned from one 
entity to another, except that an entity with a pending application may 
continue to pursue that application even if that entity becomes a 
wholly owned subsidiary of a new third party.
    (i) Change in name only of holder. Name only changes are made by 
individuals, partnerships, corporations, and other right-of-way and TUP 
holders for a variety of business or legal reasons. To complete a 
change in name only, (i.e., when the name change in question is not the 
result of an underlying change in control of the right-of-way grant or 
TUP), the following requirements must be met:
    (1) The holder must file an application requesting a name change 
and follow the same procedures as for a new grant or TUP, including 
paying processing fees (see subpart 2884 of this part). The name change 
request must include:
    (i) If the name change is for an individual, a copy of the court 
order or other legal document effectuating the name change; or
    (ii) If the name change is for a corporation, a copy of the 
corporate resolution(s) proposing and approving the name change, a copy 
of the filing/acceptance of the change in name by the State or 
territory in which incorporated, and a copy of the appropriate 
resolution(s), order(s), or other documentation showing the name 
change.
    (2) In connection with its processing of a name change only, the 
BLM retains the authority under Sec.  2885.13 to modify the grant or 
TUP, or add bonding and other requirements, including additional terms 
and conditions, to the grant or TUP.
    (3) The BLM will recognize a name change in writing.
0
71. In Sec.  2887.12, add new paragraphs (d) and (e) to read as 
follows:


Sec.  2887.12  How do I renew my grant?

* * * * *
    (d) If you make timely and sufficient application for a renewal of 
your existing grant or for a new grant in accordance with this section, 
the existing grant does not expire until we have issued a decision to 
approve or deny the application.
    (e) If we deny your application, you may appeal the decision under 
Sec.  2881.10.

    Dated: September 23, 2014.
Janice M. Schneider,
Assistant Secretary, Land and Minerals Management, U.S. Department of 
the Interior.
[FR Doc. 2014-23089 Filed 9-26-14; 11:15 am]
BILLING CODE 4310-84-P