[Federal Register Volume 89, Number 95 (Wednesday, May 15, 2024)]
[Rules and Regulations]
[Pages 42602-42762]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-08791]



[[Page 42601]]

Vol. 89

Wednesday,

No. 95

May 15, 2024

Part II





 Department of the Interior





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 Bureau of Ocean Energy Management





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30 CFR Part 585





 Bureau of Safety and Environmental Enforcement





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30 CFR Part 285





 Renewable Energy Modernization Rule; Final Rule

  Federal Register / Vol. 89 , No. 95 / Wednesday, May 15, 2024 / Rules 
and Regulations  

[[Page 42602]]


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DEPARTMENT OF THE INTERIOR

Bureau of Ocean Energy Management

30 CFR Part 585

Bureau of Safety and Environmental Enforcement

30 CFR Part 285

[Docket No. BOEM-2023-0005]
RIN 1010-AE04


Renewable Energy Modernization Rule

AGENCY: Bureau of Ocean Energy Management and Bureau of Safety and 
Environmental Enforcement, Interior.

ACTION: Final rule.

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SUMMARY: The Department of the Interior (the Department or DOI), acting 
through the Bureau of Ocean Energy Management (BOEM) and the Bureau of 
Safety and Environmental Enforcement (BSEE) (``the agencies''), is 
finalizing regulatory amendments to its renewable energy regulations 
under the authority of the Outer Continental Shelf Lands Act (OCSLA). 
The notice of proposed rulemaking (NPRM) for this final rule was 
published in the Federal Register on January 30, 2023. While the NPRM 
contemplated amendments only to the Department's existing renewable 
energy regulations that are administered by BOEM, this final rule also 
finalizes regulatory amendments previously proposed by BOEM that are 
now administered by BSEE and includes amendments to regulations 
resulting from the ``Reorganization of Title 30--Renewable Energy and 
Alternative Uses of Existing Facilities on the Outer Continental 
Shelf'' direct final rule, issued by the Department on January 31, 
2023. This final rule eliminates unnecessary requirements for the 
deployment of meteorological (met) buoys; increases survey flexibility; 
improves the project design and installation verification process; 
establishes a public Renewable Energy Leasing Schedule; reforms BOEM's 
renewable energy auction regulations; tailors financial assurance 
requirements and instruments; clarifies safety management system 
regulations; revises other provisions; and makes technical corrections. 
This final rule advances the Department's energy policies in a safe and 
environmentally sound manner that will provide a fair return to the 
U.S. taxpayer.

DATES: This final rule is effective on July 15, 2024.

ADDRESSES: The Bureau of Ocean Energy Management (BOEM) has established 
a docket for this action under Docket ID No. BOEM-2023-0005. All 
documents in the docket are listed on the https://www.regulations.gov 
website and can be found by entering the Docket ID No. in the ``Enter 
Keyword or ID'' search box and clicking ``search''.

FOR FURTHER INFORMATION CONTACT: For questions about this final action 
regarding 30 CFR parts 585 and 586, contact Nabanita Modak Fischer, 
Office of Regulations, BOEM, 45600 Woodland Road, Sterling, Virginia 
20166, at email address [email protected] or at telephone 
number (703) 787-1415; and Karen Thundiyil, Chief, Office of 
Regulations, BOEM, 1849 C Street NW, Washington, DC 20240, at telephone 
number (202) 742-0970 or email address [email protected]. For 
questions about this final action regarding 30 CFR part 285, contact 
Kirk Malstrom, Chief, Regulations and Standards Branch, BSEE, at 
telephone number (202) 258-1518 or email address [email protected]. 
Individuals in the United States who are deaf, deafblind, hard of 
hearing, or have a speech disability may dial 711 (TTY, TDD, or 
TeleBraille) to access telecommunications relay services. These 
services are available 24 hours a day, 7 days a week, to leave a 
message or question with the point-of-contact. You will receive a reply 
during normal business hours. Individuals outside the United States 
should use the relay services offered within their country to make 
international calls to the point-of-contact in the United States.

SUPPLEMENTARY INFORMATION: 
    Preamble acronyms and abbreviations. Multiple acronyms and 
abbreviations are included in this preamble. While this list may not be 
exhaustive, to ease the reading of this preamble and for reference 
purposes, the agencies define the following terms and acronyms here:

ANCSA Alaska Native Claims Settlement Act of 1971
ANSI American National Standards Institute
API American Petroleum Institute
ASLM Assistant Secretary for Land and Minerals Management
ASSP American Society of Safety Professionals
BOEM Bureau of Ocean Energy Management
BSEE Bureau of Safety and Environmental Enforcement
CAA Clean Air Act of 1970
CAB Conformity Assessment Body
CBA Community Benefit Agreement
CEQ Council on Environmental Quality
CFR Code of Federal Regulations
COP Construction and Operations Plan
CRA Congressional Review Act
CSSCR Critical Safety Systems Commissioning Records
CSSE Critical Safety Systems and Equipment
CVA Certified Verification Agent
CZM Coastal Zone Management
CZMA Coastal Zone Management Act of 1972
Department U.S. Department of the Interior
DNCI Determination of No Competitive Interest
DNV Det Norske Veritas
DM Departmental Manual
DOE U.S. Department of Energy
DOI U.S. Department of the Interior
EA Environmental Assessment
EBM Ecosystem-based Management
EIS Environmental Impact Statement
E.O. Executive Order
EPAct Energy Policy Act of 2005
ESA Endangered Species Act of 1973
ESP Environmental Studies Program
FCC Federal Consistency Certification
FDR Facility Design Report
FERC Federal Energy Regulatory Commission
FIR Fabrication and Installation Report
FOIA Freedom of Information Act
FOWT Floating Offshore Wind Turbines
FR Federal Register
FSN Final Sale Notice
G&G Geological and Geophysical
GAP General Activities Plan
GHG Greenhouse Gas
IBLA Interior Board of Land Appeals (U.S. Department of the 
Interior)
IC Information Collection
IEC Inclusive Engineering Consortium
IECRE IEC System for Certification to Standards Relating to 
Equipment for Use in Renewable Energy
IRA Inflation Reduction Act
ISO Independent System Operator
LPA Labor Peace Agreement
MACO Mid-Atlantic Council on the Ocean
MMS Minerals Management Service
MOU Memorandum of Understanding
NAGPRA Native American Graves Protection and Repatriation Act
NCCOS National Centers for Coastal Ocean Science
NEPA National Environmental Policy Act of 1969
NHPA National Historic Preservation Act of 1966
NMFS National Marine Fisheries Service
NMSA National Marine Sanctuaries Act of 1972
NOAA National Oceanic and Atmospheric Administration
NONC Notice of Noncompliance
NROC Northeast Regional Ocean Council
NPRM Notice of proposed rulemaking
NRSRO Nationally Recognized Statistical Rating Organization
NTL Notice to Lessee
NWP Nationwide Permit
OCS Outer Continental Shelf
OCSLA Outer Continental Shelf Lands Act
OEM Original Equipment Manufacturer
OIRA Office of Information and Regulatory Affairs
OMB Office of Management and Budget
ONRR Office of Natural Resources Revenue
OSRP Oil Spill Response Plan
OSW Offshore Wind

[[Page 42603]]

PATON Private Aids to Navigation
PDE Project Design Envelope
PEIS Programmatic Environmental Impact Statement
PLA Project Labor Agreement
PPA Power Purchase Agreement
PRA Paperwork Reduction Act of 1995
PSN Proposed Sale Notice
Pub. L. Public Law
PVR Project Verification Report
RFA Regulatory Flexibility Act of 1995
RFI Request for Information
RHA Rivers and Harbors Act of 1899
RIA Regulatory Impact Analysis
RNA Rotor-nacelle Assembly
ROP Regional Ocean Partnerships
ROW Right-of-Way
RTO Regional Transmission Organization
RUE Right-of-Use-and-Easement
S&P Standard and Poor's
SAP Site Assessment Plan
SBREFA Small Business Regulatory Enforcement Fairness Act of 1996
SIEBA Standardizing Integrated Ecosystem-Based Assessments
SME Subject Matter Expert
SMS Safety Management System
UMRA Unfunded Mandates Reform Act of 1995
USACE U.S. Army Corps of Engineers
U.S.C United States Code
USCG U.S. Coast Guard
USEPA U.S. Environmental Protection Agency
WCOA West Coast Ocean Alliance
WTG Wind Turbine Generator

    Background information. On January 30, 2023, the Department issued 
an NPRM to modernize its regulations to facilitate the development of 
offshore wind (OSW) energy resources (88 FR 5968). On January 31, 2023, 
the Department issued the ``Reorganization of Title 30--Renewable 
Energy and Alternative Uses of Existing Facilities on the Outer 
Continental Shelf'' direct final rule (88 FR 6376) following the 
delegation of authority to BSEE to administer some of the regulations 
addressed in the NPRM.\1\ The agencies have summarized the significant 
comments received on the proposed rule and have provided responses to 
them in this preamble.
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    \1\ 219 DM 1, DOI Departmental Manual (Sept. 14, 2022).
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    Organization of this document. The information in this preamble is 
organized as follows:

I. General Information
    A. Executive Summary
    B. Does this action apply to me?
    C. Where can I get a copy of this document and other related 
information?
II. Background
    A. BOEM and BSEE Statutory and Regulatory Authority and 
Responsibilities
    B. History of Renewable Energy Modernization Rule
    C. Purpose of This Rulemaking
    D. Summary of the Proposed Renewable Energy Modernization Rule
III. Summary of the Significant Provisions
    A. Site Assessment Facilities
    1. What did the Department propose?
    2. What are the key public comments?
    3. What is the Department finalizing?
    B. Project Design Envelope
    1. What did the Department propose?
    2. What are the key public comments?
    3. What is the Department finalizing?
    C. Geophysical and Geotechnical Surveys
    1. What did the Department propose?
    2. What are the key public comments?
    3. What is the Department finalizing?
    D. Certified Verification Agent and Engineering Report
    1. What did the Department propose?
    2. What are the key public comments?
    3. What is the Department finalizing?
    E. Renewable Energy Leasing Schedule
    1. What did the Department propose?
    2. What are the key public comments?
    3. What is the Department finalizing?
    F. Lease Issuance Procedure
    1. What did the Department propose?
    2. What are the key public comments?
    3. What is the Department finalizing?
    G. Risk Management and Financial Assurance
    1. What did the Department propose?
    2. What are the key public comments?
    3. What is the Department finalizing?
    H. Safety Management Systems (SMS)
    1. What did the Department propose?
    2. What are the key public comments?
    3. What is the Department finalizing?
    I. Inspections
    1. What did the Department propose?
    2. What are the key public comments?
    3. What is the Department finalizing?
    J. Other Proposed Changes in Part 285
    1. What did the Department propose?
    2. What are the key public comments?
    3. What is the Department finalizing?
    K. Other Proposed Changes in Part 585
    1. What did the Department propose?
    2. What are the key public comments?
    3. What is the Department finalizing?
    L. Potential Revisions to Regulations Governing Research 
Activities
    1. What did the Department propose?
    2. What are the key public comments?
    3. What is the Department finalizing?
    M. Potential Revisions to Regulations Governing Transmission
    1. What did the Department propose?
    2. What are the key public comments?
    3. What is the Department finalizing?
    N. General Comments and Responses
IV. Summary of Cost, Economic Impacts, and Additional Analyses 
Conducted
    A. What are the affected resources?
    B. What are the economic impacts?
    C. What are the benefits?
    D. What Tribal engagement activities were conducted?
V. Section-by-Section Analysis
    A. 30 CFR Part 285
    B. 30 CFR Part 585
VI. Statutory and Executive Order Reviews
    A. Executive Order 12866: Regulatory Planning and Review, as 
Amended by Executive Order 14094: Modernizing Regulatory Review, and 
Executive Order 13563: Improving Regulation and Regulatory Review
    B. Regulatory Flexibility Act (RFA)
    C. Small Business Regulatory Enforcement Fairness Act (SBREFA)
    D. Unfunded Mandates Reform Act (UMRA)
    E. Executive Order 12630: Governmental Actions and Interference 
With Constitutionally Protected Property Rights
    F. Executive Order 13132: Federalism
    G. Executive Order 12988: Civil Justice Reform
    H. Executive Order 13175: Consultation and Coordination with 
Indian Tribal Governments
    I. Paperwork Reduction Act (PRA)
    J. National Environmental Policy Act (NEPA)
    K. Data Quality Act
    L. Executive Order 13211: Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution, or Use
    M. Congressional Review Act (CRA)

I. General Information

A. Executive Summary

1. Purpose of This Regulatory Action
    Congress authorized the Secretary of the Interior to grant Outer 
Continental Shelf (OCS) leases for renewable energy activities when it 
enacted the Energy Policy Act of 2005. The Secretary delegated 
authority to BOEM and BSEE to carry out development and oversight of 
the Nation's offshore energy resources.
    This action finalizes certain provisions proposed in the Renewable 
Energy Modernization Rule (88 FR 5968, January 30, 2023). A summary of 
the key provisions is included below. This final rule facilitates the 
development of OCS renewable energy and supports the Department's 
commitment to ensuring safe and responsible domestic energy production. 
The final rule modernizes the offshore renewable energy regulations, 
streamlines processes, clarifies regulatory provisions, enhances 
compliance provisions, and corrects technical errors and 
inconsistencies. Through these changes, the Department aims to reduce 
administrative burdens and reduce cost and uncertainty while creating 
greater regulatory flexibility in a rapidly evolving industry. This 
final rule updates OCS renewable energy regulations to reflect lessons 
learned since the regulations were originally promulgated in 2009. The 
Department projects this action will save the renewable energy industry 
$1 billion over 20 years.
2. Summary of the Key Provisions
    The final rule contains eight key provisions:
    (1) Eliminating unnecessary requirements for the deployment of met 
buoys (30 CFR part 585, subpart G).

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    This action finalizes the elimination of the existing regulations 
that required on-lease site assessment plans (SAPs) and BOEM permitting 
for met buoys. However, deployment of met buoys that qualify as 
obstructions deployed in U.S. navigable waters under section 10 of the 
Rivers and Harbors Act (RHA) would continue to require US Army Corps of 
Engineers (USACE) permits. Met buoys are also typically required to be 
marked and lighted in accordance with a U.S. Coast Guard private aids 
to navigation (PATON) approval. Met buoys will continue to require U.S. 
Coast Guard PATON approval under 33 CFR part 66 and 14 U.S.C. 545. This 
final rule clarifies that the elimination of the Department's 
regulations requiring SAPs and BOEM permitting for met buoys does not 
reduce or eliminate the need for BOEM's environmental review of site 
characterization (geotechnical and geophysical surveys, biological 
surveys) and site assessment activities (deployment of met towers and 
buoys). This final rule also notes that the USACE may incorporate its 
own decommissioning requirements in permits applicable to met buoys but 
BSEE's decommissioning requirements in part 285 will apply to met buoys 
if the USACE has not required a decommissioning obligation. BSEE 
expects to utilize its regulatory authority for decommissioning of 
buoys in limited circumstances.
    (2) Increasing survey flexibility (30 CFR part 585, subpart G).
    This action finalizes the provision allowing deferral of some 
geotechnical surveys until the submission of the Facility Design Report 
(FDR). This change is being finalized to allow more time to complete 
the required geotechnical surveys and provide greater flexibility in 
designing projects. At the same time, this action clarifies that the 
submission of geophysical data, including subsea archaeological 
surveys, cannot be deferred to the FDR and will continue to be required 
in a construction and operations plan (COP).
    (3) Improving the project design and installation verification 
process (30 CFR part 285, subpart G).
    This action finalizes the provisions that expanded the role of the 
certified verification agent (CVA) to include verification of the 
design and commissioning of the Critical Safety Systems and Equipment 
(CSSE) to ensure that any activities authorized by BSEE are carried out 
safely. The reliance on CVAs will provide an independent source of 
review for key stages of project development and help to establish 
public confidence in the renewable energy industry. Also, to reduce 
confusion and ambiguity, the final rule clarifies BSEE's expectations 
for CVA ``verification'' and ``certification'' that are practical and 
consistent with the policy goal of promoting safety.
    (4) Establishing a Public Renewable Energy Leasing Schedule (30 CFR 
part 585, subpart B).
    This rule finalizes the renewable energy leasing schedule 
amendments as proposed. The schedule for leasing will provide increased 
certainty and enhanced transparency and is intended to facilitate 
planning by industry, the States, and other stakeholders. The schedule 
of anticipated leasing would be updated at least once every 2 years. 
This final rule provides clarification that the offshore wind leasing 
schedule should not be confused with BOEM's National Outer Continental 
Shelf Oil and Gas Leasing Program schedule and explains that BOEM is 
committed to following the Department's policy on consultation with 
Tribes where there are Department actions that may have a substantial 
direct effect on a Tribe(s).
    (5) Reforming BOEM's renewable energy auction regulations (30 CFR 
part 585, subpart C).
    This rule finalizes the pre- and post-auction procedure amendments 
as proposed, with added clarifications. These amendments address the 
use of bidding credits and more clearly outline auction processes and 
requirements. This final rule describes how BOEM operationalizes its 
commitment to coordinate with Tribes and conduct consultation with the 
Tribal leadership for Tribes that may be affected by any leases, 
easements, or right-of-way (ROWs); and notes that the regulations 
require Tribal consultation prior to the issuance of a lease and during 
area identification before competitive leasing.
    Additionally, in this final rule, BOEM finalizes the auction 
process as proposed, including providing clarification for how BOEM 
will consider the use of bidding credits on a case-by-case basis 
specific to the lease sale conditions.
    (6) Financial assurance requirements and instruments (30 CFR part 
585, subpart F).
    This action finalizes the use of credit ratings, requiring 
financial assurance at a more relevant time, allowing for staged 
funding of decommissioning accounts, and adding letters of credit as an 
acceptable financial assurance instrument. In addition, this final rule 
allows for a lessee to demonstrate its capacity to meet financial 
assurance requirements for lease or grant activities based on 
electricity sales contracts and net income projections.
    (7) Clarifying safety management system regulations (30 CFR part 
285, subpart H).
    This final rule clarifies the information requirements for safety 
management systems (SMS) and expectations regarding SMS standards. It 
adds a provision to incentivize lessees and grantees to obtain a safety 
management certification from recognized accreditation organizations to 
reduce the frequency and intensity of regulatory oversight activities. 
The final rule also clarifies that lessees and grantees are required to 
have and use an SMS for all OCS activities undertaken pursuant to a 
lease, from site assessment through decommissioning. The final rule 
also establishes a performance-based approach to promote flexibility in 
determining the best way to ensure the safety of personnel on and near 
OCS renewable energy facilities during activities covered by the SMS.
    (8) Other provisions.
    This action finalizes all technical corrections as proposed. The 
most significant of these provisions will restructure commercial lease 
terms into four periods tied to activities required to develop the 
lease; explicitly allow regulatory departures before and after a lease 
or grant is issued or made; authorize civil penalties without either 
notice or a time period for corrective action when violations 
constitute a threat of serious, irreparable, or immediate harm or 
damage; add specific procedures regarding lease segregation and 
consolidation; and standardize the annual rental rate per acre across 
most grants.
3. Costs and Benefits
    The Regulatory Impact Analysis (RIA) estimates the costs and 
benefits of the rule. The RIA can be found in the rulemaking docket 
(Docket No. BOEM-2023-0005). BOEM, on behalf of the Department, 
conducted a Regulatory Impact Analysis to consider the costs and 
benefits of the rule. Most of the revisions in the rule have negligible 
or no cost impact, while others may have second-order benefits that are 
difficult to quantify. BOEM identified four elements of the rule that 
have quantifiable effects. Three of those changes (met buoy 
requirements, financial assurance, and geotechnical survey revisions) 
provide compliance cost savings and one, SMS reporting, has minor 
compliance cost burdens. In net, BOEM estimates these changes could 
save the OCS renewable energy industry approximately $127 million in 
annualized cost savings over the 20-year period of analysis (3 percent 
discounting). In addition to these

[[Page 42605]]

quantitative costs and benefits, the rule also provides qualitative 
benefits. This rule provides additional clarity and certainty, while 
streamlining the regulatory framework. The changes from this rule will 
facilitate more expedient and responsible development of offshore 
renewable energy projects.

B. Does this action apply to me?

    Entities potentially affected by this action include, but are not 
limited to, all current and future OCS renewable energy lessees, 
grantees, and operators.

C. Where can I get a copy of this document and other related 
information?

    In addition to being available in the docket, an electronic copy of 
this final rule will also be available on the internet. Following 
signature by the Principal Deputy Assistant Secretary of Land and 
Minerals Management (ASLM), BOEM will post a copy of this final rule 
at: https://www.boem.gov/about-boem/regulations-guidance/published-rules. Following publication in the Federal Register (FR), the 
published version of the final rule will be available on BOEM's and 
BSEE's respective websites.

II. Background

A. BOEM and BSEE Statutory and Regulatory Authority and 
Responsibilities

    Congress authorized the Secretary to grant OCS leases for renewable 
energy activities when it enacted the Energy Policy Act of 2005, which 
amended OCSLA by adding a new subsection 8(p).\2\ Subsection 8(p) of 
OCSLA authorizes the Secretary to award OCS leases, ROWs, and right-of-
use and easement grants (RUEs) for activities not otherwise authorized 
by other applicable law, if those activities ``produce or support 
production, transportation, storage, or transmission of energy sources 
other than oil or gas.'' Subsection 8(p) requires the Secretary to 
award such leases, ROWs, and RUEs on a competitive basis unless the 
Secretary determines, following public notice, that competitive 
interest does not exist. Subsection 8(p) also authorizes the Secretary 
to issue regulations to carry out the subsection's grant of authority. 
The Secretary delegated that authority to BOEM's and BSEE's 
predecessor, the Minerals Management Service (MMS). Subsection 8(p)(8) 
of OCSLA (43 U.S.C. 1337(p)(8)) authorizes the Secretary to ``issue any 
necessary regulations to carry out this subsection.'' Subsection 
8(p)(10) (43 U.S.C. 1337(p)(10)) of OCSLA states ``this subsection does 
not apply to any area on the Outer Continental Shelf within the 
exterior boundaries of any unit of the National Park System, National 
Wildlife Refuge System, or National Marine Sanctuary System, or any 
National Monument.'' NOAA may consider authorizing renewable energy 
activities, and/or activities in support of the development of 
renewable energy, under the authority of the National Marine 
Sanctuaries Act, through one or more of the following mechanisms--
General Permits, Authorizations, Certifications, and Special Use 
Permits.
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    \2\ Codified at 43 U.S.C. 1337(p).
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B. History of Renewable Energy Modernization Rule

    On March 20, 2006, the Secretary delegated the responsibility for 
regulating OCS renewable energy activities to MMS,\3\ the predecessor 
agency to BOEM and BSEE. MMS promulgated the first OCS renewable energy 
regulations on April 29, 2009 (74 FR 19638). Between May 19, 2010, and 
August 29, 2011, Secretary Salazar issued Secretary's Order 3299 and 
two amendments that ultimately divided MMS into three separate 
agencies: BOEM, BSEE, and the Office of Natural Resources Revenue 
(ONRR). The Secretary emphasized the importance of separate and 
independent safety and environmental oversight when testifying before 
Congress on May 26, 2010:
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    \3\ 218 DM 1-6; 218 DM 8.
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    The Deepwater Horizon tragedy and the massive spill have made the 
importance and urgency of a reorganization of this nature ever more 
clear, particularly the creation of a separate and independent safety 
and environmental enforcement entity. We will responsibly and 
thoughtfully move to establish independence and separation for this 
critical mission so that the American people know they have a strong 
and independent organization ensuring that energy companies comply with 
their safety and environmental protection obligations.\4\
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    \4\ Minerals Management Service Reorganization: Special Hearing 
Before the Subcomm. on Dept. of the Interior, Environment & Related 
Agencies of the S. Comm. On Appropriations, S. Hrg. 111-1035, at 12 
(2010) (statement of Ken Salazar, Sec'y of the Interior).
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    Pursuant to section 3 of Secretary's Order 3299, Amendment No. 2, 
BOEM ``exercise[s] the conventional (e.g., oil and gas) and renewable 
energy-related management functions of the [MMS] not otherwise 
transferred pursuant to this Order including, but not limited to, 
activities involving resource evaluation, planning, and leasing.'' \5\ 
Under section 4 of Secretary's Order 3299, Amendment No. 2, BSEE 
exercises ``safety and environmental enforcement functions,'' including 
``the authority to inspect, investigate, summon witnesses and produce 
evidence, levy penalties, cancel or suspend activities, and oversee 
safety, response, and removal preparedness.'' \6\
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    \5\ Sec'y of the Interior Order 3299, as amended and issued Aug. 
29, 2011, available at https://www.doi.gov/sites/doi.gov/files/elips/documents/3299a2-establishment_of_the_bureau_of_ocean_energy_management_the_bureau_of_safety_and_environmental_enforcement_and_the_office_of_natural_resources_revenue.pdf.
    \6\ Id.
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    Section 4 of Secretary's Order 3299, Amendment 2, assigned the 
renewable energy program to BOEM ``until such time that the [ASLM] 
determines that an increase in activity justifies transferring the 
inspection and enforcement functions to [BSEE].'' On October 18, 2011, 
the Department's regulations that were administered by BOEM were 
codified at 30 CFR chapter V, and its renewable energy regulations were 
located in 30 CFR part 585.\7\ Subsequently, in September 2013, the DOI 
Office of Inspector General (OIG) issued a report supporting the policy 
of independent regulatory oversight and enforcement in the renewable 
energy program and recommending implementation of that policy through a 
transfer of those responsibilities from BOEM to BSEE.\8\ The OIG noted 
that ``allowing the bureau responsible for planning and leasing 
renewable energy projects [i.e., BOEM] to also formulate the policies 
for inspection and enforcement is contrary to the independent oversight 
and separation of duties envisioned in [Secretary's Order 3299] as 
originally issued.'' \9\ In the years since the 2009 rulemaking and the 
DOI OIG report in 2013, the renewable energy industry and BOEM's and 
BSEE's renewable energy programs have grown substantially. 
Consequently, the Department promulgated a rule of agency organization 
and procedure entitled ``Reorganization of Title 30--Renewable Energy 
and Alternate Uses of Existing Facilities on the Outer Continental 
Shelf'' (``Reorganization Rule'') that transferred existing safety and 
environmental oversight and enforcement regulations governing OCS 
renewable energy activities from 30 CFR

[[Page 42606]]

part 585, administered by BOEM, to 30 CFR part 285, administered by 
BSEE.
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    \7\ Reorganization of Title 30: Bureaus of Safety and 
Environmental Enforcement and Ocean Energy Management, 76 FR 64432 
(Oct. 18, 2011).
    \8\ Office of Inspector Gen., Dept of Interior, U.S. Department 
of the Interior's Offshore Renewable Energy Program 9 (2013) (Report 
No. CR-EV-BOEM-0001-2013).
    \9\ Id.
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    Over the past decade, BOEM has conducted twelve competitive 
renewable energy lease sales and administered thirty-four commercial 
leases. Through these activities and working actively with relevant 
stakeholders, the Department identified opportunities to modernize its 
regulations and better facilitate the development of offshore wind 
energy resources. BOEM held multiple public meetings and engaged in 
significant stakeholder engagement and received recommendations from 
industry, technical and scientific organizations, other government 
agencies and other stakeholders on the reform of the renewable energy 
program. Since then, the Department has refined its goals for meeting 
U.S. climate and renewable energy objectives.
    The Department determined that aspects of its renewable energy 
regulations could be streamlined and improved since the last 
rulemaking.
    On January 30, 2023, the Department proposed the Renewable Energy 
Modernization Rule to reduce regulatory burdens and streamline the 
regulations, incorporate the recommendations from the stakeholders, and 
achieve the U.S. climate and renewable energy goals. 88 FR 5968. The 
proposed Renewable Energy Modernization Rule was the result of over ten 
years of effort by the Department and industry to identify and resolve 
the obstacles to establishing an effective and commercially viable 
offshore renewable energy industry on the OCS.

C. Purpose of This Rulemaking

    This final rule includes regulations administered by BOEM (30 CFR 
parts 585 and 586) and BSEE (30 CFR part 285), as identified in the 
Reorganization Rule. A summary of key provisions is provided below. The 
Department believes that this final rule will facilitate the 
development of OCS renewable energy and promote U.S. climate and 
renewable energy objectives in a safe and environmentally sound manner 
while providing a fair return to the U.S. taxpayer. The final rule 
reforms the renewable energy regulations, streamlines processes, 
clarifies ambiguous provisions, enhances compliance provisions, and 
corrects technical errors and inconsistencies. Through these changes, 
the Department aims to reduce administrative burdens, reduce costs and 
uncertainty, and introduce greater regulatory flexibility in a rapidly 
evolving industry to foster the growth of OCS renewable energy, while 
maintaining environmental safeguards. The Department's regulatory 
changes in this final rule are not intended to contradict, preempt, 
supersede, alter, or otherwise be incompatible with the authority and 
jurisdiction of other Federal agencies or entities or their 
regulations. Rather, the Department's purpose for these changes is to 
ensure the development of renewable energy on the OCS is carried out in 
a manner that provides for safety and protection of the environment, in 
addition to the other factors as specified in OCSLA Section 8(p).

D. Summary of the Proposed Renewable Energy Modernization Rule

    On January 30, 2023, the Department published the NPRM, which 
proposed amendments to 30 CFR part 585. The NPRM proposed key 
provisions that would accomplish the following:
    (1) Eliminate SAP requirements for met buoys;
    (2) Adopt a flexible and performance-based approach to geophysical 
and geotechnical surveying;
    (3) Conform the CVA review standard to industry practice and 
provide flexibility in the CVA nomination and engineering report 
submittal process;
    (4) Clarify auction procedures;
    (5) Align financial assurance requirements with the risk to U.S. 
taxpayers and permit incremental funding of decommissioning accounts;
    (6) Clarify and enhance safety management requirements; and
    (7) Make other revisions and technical corrections that would 
improve the Department's OCS renewable energy regulatory program.

III. Summary of the Significant Provisions

    The following section provides a summary of key comments and 
responses regarding significant provisions and the Department's 
rationale for the final decisions and amendments in those significant 
provisions.

A. Site Assessment Facilities

1. What did the Department propose?
    (a) 30 CFR 585.104 Do I need a BOEM lease or other authorization to 
produce or support the production of electricity or other energy 
product from a renewable energy resource on the OCS?
    The proposed rule clarified that off-lease site assessment 
facilities would not require a limited lease and the Department would 
not conduct any case-by-case determinations regarding whether off-lease 
site assessment activities require a lease. This proposed clarification 
of BOEM's authority over off-lease site assessment activities applied 
to both met buoys and met towers. Although met towers have greater 
environmental impacts than met buoys, BOEM did not believe this 
proposed regulatory change would increase environmental risk due to 
USACE permitting requirements, common use of met buoys, and BOEM's 
existing practice.
    (b) 30 CFR 585.113 Definitions.
    The Department proposed to define the following terms:
    Bidding credit(s), commercial activities, commercial operations, 
critical safety system, engineered foundation, fabrication, lease area, 
multiple factor auction, project design envelope, provisional winner, 
receipt, and site assessment activities.
    (c) 30 CFR 585.600 What plans must I submit to BOEM before I 
conduct activities on my lease or grant?
    The existing regulations required lessees to submit an SAP for BOEM 
approval before conducting any site assessment activities on their 
commercial leases. The proposed rule proposed to exempt floating site 
assessment facilities, such as met buoys, from the SAP requirement. 
Under the proposed rule, a lessee planning to install an industry-
standard met buoy using a gravity anchor for site assessment would not 
require an SAP.
    The proposal intended to allow lessees to deploy met buoys more 
efficiently and at a reduced cost given that an SAP would no longer be 
required. Instead, a met buoy would generally be authorized by USACE 
permitting requirements under section 10 of the Rivers and Harbors Act 
(such as Nationwide Permit (NWP) 5 that applies to Scientific 
Measurement Devices, see 86 FR 73522, or a similar USACE general permit 
or individual permit). Under the proposed rule, BOEM would no longer 
authorize met buoys on the OCS. Consequently, the proposed rule would 
have also eliminated the need for a Clean Air Act (CAA) air quality 
permit from the U.S. Environmental Protection Agency (USEPA) for on-
lease met buoys with backup diesel generators because these buoys would 
fall outside the CAA definition of an ``OCS source.'' To accommodate 
the SAP changes, BOEM proposed several ancillary regulatory changes, 
including eliminating deadlines for SAP submittals, decoupling the 
requirement to operate under a Safety Management System (SMS) from SAP 
submission, and removing references to terminology that relates 
primarily to buoys (e.g., anchors,

[[Page 42607]]

chains, moorings) in the SAP regulations.
    USACE NWP 5 or a similar USACE general permit complies with current 
Federal environmental laws and governs deployment of devices whose 
purpose is to measure and record scientific data and that result in no 
more than minimal individual and cumulative adverse environmental 
impacts. Under the proposed rule, site assessment activities would 
still require an SMS, and the Department would still maintain oversight 
of site assessment activities.
    (d) 30 CFR 585.900(c) Who must meet the decommissioning obligations 
in this subpart?
    The proposed rule also proposed to amend the decommissioning 
regulations to avoid duplicative or conflicting requirements for the 
removal of met buoys. Under the proposed rule, a lessee would 
decommission its met buoys according to the USACE requirements of an 
issued permit. In these circumstances, USACE would be responsible for 
determining on a case-by-case basis if financial assurance is required 
at the time of buoy installation. If for some reason the USACE did not 
require its buoy decommissioning, BSEE retains the authority to require 
decommissioning of the buoys. BSEE expects to utilize its regulatory 
authority for decommissioning of buoys in limited circumstances. In 
addition, BOEM may request additional financial assurance under Sec.  
585.517(b), or if necessary, apply financial assurance held under Sec.  
585.516(a)(1). Further, BOEM retains the authority to require 
decommissioning financial assurance for buoy(s) that remain in place 
when the agency authorizes subsequent construction and operations on 
the OCS under a COP or GAP. Under the proposed rule, the buoys would be 
authorized and installed pursuant to USACE regulations and USACE would 
assume responsibility for ensuring that any required removal takes 
place in accordance with the terms and conditions of the permit and at 
USACE's discretion. In these circumstances, the USACE would be 
responsible for determining on a case-by-case basis if financial 
assurance is required.
2. What are the key public comments?
    (a) On-lease met buoys.
    Comment: Several commenters expressed concern or opposition to the 
proposal. A commenter discussed the impact that BOEM's proposal to 
delay the SAP to be concurrent with the COP would have on the planning 
process. The commenter stated that the proposal delays public awareness 
of the plan and an opportunity to ``affect it early in the planning 
process.'' The commenter also stated that if BOEM were to merge the SAP 
and COP phases, then a project Environmental Impact Statement (EIS) 
would have to be prepared prior to lease award.
    Response: The purpose of an SAP is to describe proposed data 
collection facilities, such as a meteorological (met) tower or buoy. 
Such facilities are often--but not always--needed to collect the data 
required for inclusion in a COP. Under the existing regulations, an SAP 
is superfluous for a proposed project that does not include 
installation of a met tower or buoy, yet the existing regulations still 
require the submittal and approval of such plans. The final rule 
eliminates this formal requirement but does not affect BOEM's 
responsibilities to conduct environmental reviews or consultations. 
Therefore, this change does not require preparation of an EIS prior to 
a lease award.
    Comment: Several commenters expressed concern with the language 
under Sec.  585.600(b)(4) stating that BOEM would have discretion to 
waive certain information or analysis requirements in a proposed SAP if 
the applicant can demonstrate that the information is not needed or 
required by a state's coastal management program. According to the 
commenters, the language implies that BOEM can make decisions on behalf 
of coastal states regarding what information is sufficient for Federal 
consistency review. In an effort to promote cooperation among BOEM, 
lessees, and coastal states, a commenter suggested BOEM revise the 
amended language to limit the exemption provision to the necessary data 
and information required to initiate Federal consistency review; make 
explicit reference to National Oceanic and Atmospheric Administration 
(NOAA) Federal consistency regulations; and involve States in the 
decision-making process for information waiving requirements. Another 
commenter suggested that BOEM revise the amended language to limit the 
exemption provision, noting that without the identified data and 
information described in 15 CFR 930.58 and in a state's approved 
enforceable policies, a State would not be able to conduct a Federal 
consistency review and be required to request this information, further 
delaying the Federal consistency review process.
    Response: The commenters are correct that neither the applicant nor 
BOEM can dictate what data and information is deemed necessary to 
conduct an adequate consistency review based on the enforceable 
policies of a State's coastal management program. The final rule, 
however, would not have that effect. As noted in the proposed rule 
preamble, the applicant would need to ``demonstrate that . . . the 
information is not needed or required by a State's coastal management 
program'' before BOEM would grant a waiver and this demonstration would 
entail confirmation with the affected State.
    Comment: BOEM received other comments opposing the proposed 
revisions and stating that the proposal not to require an SAP for met 
buoys pursuant to Sec.  585.600 may limit environmental review, data 
collection, siting considerations, and buoy removal planning 
requirements for developers. Commenters also offered suggestions 
regarding anchor abandonment and duplication in buoy siting. Commenters 
requested more information from BOEM on how these concerns would be 
addressed under this proposed change. The commenter also stated they, 
``look forward to contributing to defining `unnecessary requirements' 
within the Makah area of sovereign interest.''
    Response: This rulemaking does not reduce or eliminate BOEM's 
environmental review of site characterization (geotechnical and 
geophysical surveys, biological surveys) and site assessment activities 
(deployment of met towers and buoys). This review takes place during 
BOEM's development of an Environmental Assessment (EA) pursuant to 
NEPA, which begins with a Notice of Intent to prepare a NEPA analysis 
(and related public comment period) and concludes during the period 
between publication of a Proposed Sale Notice (PSN) and a Final Sale 
Notice (FSN) (i.e., prior to issuing a lease). These EAs analyze 
potential environmental impacts of activities expected to take place 
following lease issuance, including site characterization and site 
assessment activities. BOEM also notes that USACE may have 
decommissioning requirements applicable to met buoys, depending on the 
type of permit used and subject to district review and discretion. 
Finally, BSEE has authority to require lessees to decommission 
facilities installed within their leases under 30 CFR 285.900 and 
285.90. BSEE expects to utilize its regulatory authority for 
decommissioning of buoys in limited circumstances. This decommissioning 
authority is not constrained or affected by BOEM's changes to the SAP 
regulations. Since this comment was submitted, BOEM conducted 
government-to-government consultations with this commenter on the 
proposed rule generally and this comment in particular. BOEM also has

[[Page 42608]]

initiated and held government-to-government consultations and staff-
level meetings with the commenter and four additional Indian Tribes to 
discuss potential impacts and to solicit and fully consider their views 
on the proposed rulemaking.
    Comment: Another commenter stated the proposal would give greater 
jurisdiction and flexibility to BOEM and allow for more self-regulation 
of OSW developers. Further, the commenter stated that permitting met 
buoys and eliminating SAPs by delegating the responsibility to USACE 
would reduce public review and transparency, remove met buoys from 
OCSLA jurisdiction, and strip the requirement of CAA permits being 
issued for met buoys, which use diesel fuel for energy backup systems.
    Response: BOEM's proposed removal of the SAP requirement for met 
buoys simply resolves a significant regulatory overlap. The proposed 
rule would not delegate any authority to USACE that it does not already 
possess and exercise. The proposed removal of the SAP requirement would 
subject buoys installed for OSW purposes to all of the USACE 
requirements that currently apply to buoys installed on the OCS for any 
other purpose. It should also be noted that BOEM prepares an EA prior 
to lease issuance where impacts resulting from site characterization 
and site assessment activities are discussed and presented to the 
public for public comment and consideration before finalizing the EA. 
The final rule will not change this practice.
    Comment: Several commenters expressed concern regarding delegation 
of review to USACE. A commenter inquired about how BOEM will work with 
USACE to ensure that OSW data buoys are properly permitted and noticed 
to mariners and how BOEM will ensure stakeholders are informed about 
OSW leases in a single location. Another commenter noted the SAP 
process was more transparent to the public regarding the components of 
a lease area survey and equipment that will be used.
    Response: Stakeholder and public input is channeled through the 
NEPA review rather than through the review of an individual SAP. The 
proposed rule does not reduce or eliminate BOEM's environmental review 
of site characterization and site assessment activities (geotechnical 
and geophysical surveys, site assessment, and deployment of met buoys 
and/or met towers). This review occurs during BOEM's development of an 
EA which typically concludes with the release of a Final EA and a 
Finding of No Significant Impact during the period between the issuance 
of a PSN and an FSN. These EAs analyze all anticipated environmental 
impacts of activities expected to take place following lease issuance, 
including site characterization and site assessment activities.
    Comment: A commenter expressed opposition to the proposal to 
eliminate the SAP requirements for met buoys stating that further 
segmentation of the project review process will make stakeholder 
participation and awareness more burdensome than it already is.
    Response: Stakeholder and public input is channeled through the 
leasing EA rather than through the review of an individual SAP. The 
rule does not reduce or eliminate BOEM's environmental review of site 
characterization and site assessment activities (geotechnical and 
geophysical surveys, site assessment, and deployment of met buoys and/
or met towers). This review is completed during BOEM's development of 
an EA under NEPA which typically concludes with the release of a Final 
EA and a Finding of No Significant between the issuance of a PSN and an 
FSN. BOEM's leasing EAs analyze all anticipated impacts from site 
characterization and site assessment activities, including the 
deployment of met buoys and, in some cases, towers.
    Comment: A commenter stated that permits for lease SAP approvals of 
met buoys by the USACE must include decommissioning requirements and 
BOEM must guarantee the continuity of OSW decommissioning processes so 
that commercial fishing industry is ``not left with a cluttered benthic 
habitat without any Federal agency responsible for removal of 
structures within the Exclusive Economic Zone.''
    Response: USACE may incorporate its own decommissioning 
requirements in permit approvals of met buoys. For example, USACE NWP 5 
requires that ``upon completion of the use of the device to measure and 
record scientific data, the measuring device [i.e., met buoy] and any 
other structures or fills associated with that device (e.g., 
foundations, anchors, buoys, lines, etc.) must be removed to the 
maximum extent practicable and the site restored to pre-construction 
elevations.'' However, USACE decommissioning requirements are dependent 
on the type of permit used and subject to district review and 
discretion. Overall, USACE decommissioning requirements, coupled with 
the final rule's provision in 30 CFR 285.900(c) reserving to BSEE the 
authority to require decommissioning in the event that USACE does not 
require it and the relatively low number of met buoys should ensure 
that the Exclusive Economic Zone will not result in the ``cluttered 
benthic habitat'' that the commenter is concerned about. Overall, BSEE 
expects to utilize its regulatory authority for decommissioning of 
buoys in limited circumstances.
    Comment: A commenter stated that if a met tower or met buoy is part 
of the BOEM OSW leasing process, BOEM should conduct the permitting.
    Response: BOEM's leases do not authorize deployment of met buoys 
and grant the lessee only the exclusive right to submit plans for 
BOEM's approval. BOEM analyzes the impacts of deploying buoys at the 
lease sale stage because this activity is expected to take place 
following lease issuance. In this regard, following publication of the 
final rule, the deployment of met buoys will be considered in the same 
fashion as other reasonably foreseeable activities, the impacts of 
which are analyzed in BOEM's NEPA documents and consultations but 
require no direct authorization from BOEM (e.g., the use of port 
facilities and vessels). BOEM will concentrate on permitting more 
complex facilities and remove the unnecessary overlap in permitting 
requirements that was in place for met buoys.
    Comment: One commenter noted that under Sec.  585.600(a)(1), SAPs 
would be required only for site assessment activities involving an 
engineered foundation and that off-lease and on-lease site assessment 
activities for facilities without foundations would be authorized under 
USACE permitting requirements under section 10 of the Rivers and 
Harbors Act. The commenter stated that USACE NWPs are subject to 
regional conditions and are not used in all offshore areas and that 
this region-specific difference should be noted in the final rule.
    Response: The commenter is correct that USACE permits may be 
subject to regional conditions, and the requirements for deploying a 
buoy may vary regionally. However, BOEM's regulations are not the 
appropriate vehicle for providing guidance applicable to permits issued 
by other agencies.
    Comment: Regarding SAPs submitted before lease issuance being 
subject to Federal consistency reviews under 15 CFR part 930, subpart D 
(not subpart E), and noncompetitive lease sales reviewed under 15 CFR 
part 930, subpart D (not subpart C), two commenters suggested BOEM 
clarify language at Sec.  585.612 to account for these scenarios.

[[Page 42609]]

    Response: BOEM has considered the commenter's suggestions and notes 
that such clarifying language has already been proposed. Proposed 
revisions to Sec.  585.612(a) clarify that an SAP submitted before 
lease issuance would be subject to 15 CFR part 930, subpart D. 
Likewise, proposed revisions to Sec.  585.231(f) clarify that a 
noncompetitive lease is subject to 15 CFR part 930, subpart D. Although 
BOEM appreciates suggestions that may provide more clarity, the 
suggested revisions to include clarifying language on noncompetitive 
leases at Sec.  585.612 would be duplicative of the language that is 
already provided at Sec.  585.231(f), which is similar to BOEM's 
requirements for offshore oil and gas and marine minerals activities. 
BOEM cannot hold an OSW lease auction (Federal action, under 15 CFR 
part 930, subpart C), nor permit activities (federally permitted 
activities or plans, 15 CFR part 930, subparts D and E), without 
concurrence or presumed concurrence from the State coastal management 
programs with reasonably foreseeable coastal effects or for which the 
activities are within their geographic location description or have 
been awarded a consistency review through the unlisted activity review 
process from NOAA's Office of Coastal Management.
    Comment: A commenter expressed opposition to BOEM's proposal to 
change the SAP process to rely on USACE NWPs stating that, because of 
regional differences in offshore areas, transferring permit authority 
to the USACE may not streamline the process and may trigger additional 
Federal Consistency Certification (FCC) review.
    Response: BOEM is not transferring authority to USACE, as USACE 
generally has regulatory authority over deployment of met buoys in OCS 
areas. Any regional differences, as the commenter asserts, would exist 
regardless of whether BOEM exercises additional jurisdiction over the 
same buoys. The USACE permits scientific measurement devices used for a 
variety of purposes deployed in U.S. navigable waters and on the OCS, 
including met towers and met buoys. The USACE permitting process is 
subject to the same Federal environmental laws applicable to BOEM's SAP 
process. The USACE statutory authorities under section 404 of the CWA 
and/or section 10 of the Rivers and Harbors Act of 1899 require 
compliance with Federal environmental laws similar to BOEM's SAP 
process.
    As for BOEM, expected site characterization and site assessment 
activities on the lease will continue to be analyzed as part of the 
environmental review performed prior to a lease sale.
    USACE currently issues approval of installation of buoys for 
multiple purposes for which BOEM is not consulted and which are 
unrelated to OSW. Current lessees need to perform met buoy deployment 
and installation activities in compliance with USACE's NWP 5 or another 
applicable general permit or individual permit. In addition, BOEM has 
coordinated with USACE to ensure that the final rule addresses the 
concerns raised by the commenter.
    Comment: A commenter recommended that BOEM retain involvement in 
the permitting process by the USACE and United States Coast Guard 
(USCG) and retain involvement in geophysical and geotechnical site 
characterization survey activities.
    Response: BOEM would retain involvement in the permitting process 
through its environmental review process. This review is completed 
during BOEM's development of an EA under NEPA which typically concludes 
with the release of a Final EA and a Finding of No Significant Impact 
between the issuance of a PSN and an FSN (i.e., prior to lease 
issuance). BOEM's EAs analyze environmental impacts of activities 
expected to take place following lease issuance, including site 
characterization and site assessment activities. Further, BOEM is not 
proposing to alter its involvement in geophysical and geotechnical site 
characterization survey activities. BOEM's OSW leases include 
stipulations that require the submission of geological and geophysical 
(G&G) survey plans for review by BOEM prior to the commencement of 
survey activities. Moreover, BOEM's leasing EAs analyze potentially 
significant impacts from G&G survey activities.
    Comment: A commenter recommended that BOEM establish a clear 
framework and mechanisms for interagency consultation prior to the 
deployment of site assessment facilities with novel anchoring 
technologies that do not have a BOEM-approved SAP.
    Response: If a novel anchoring technology was proposed that was not 
analyzed in the BOEM leasing EA, or if USACE determined that effects of 
the novel anchoring technology had more than minimal adverse 
environmental effects, additional environmental review would be needed, 
and USACE may require an individual permit application. The types of 
technology permitted without further environmental review would be 
limited to those that are within the scope of the EA and any associated 
consultations.
    Comment: A commenter recommended the addition of language regarding 
the mechanism for financial assurance regarding decommissioning if 
USACE does not require site clearance ahead of site assessment 
activities.
    Response: BOEM would not hold decommissioning financial assurance 
for facilities, like a met buoy, for which the agency did not issue an 
approval. The lessee may have decommissioning obligations under its 
USACE authorization, but BOEM would not hold financial assurance 
guaranteeing that obligation. Although BOEM would not hold 
decommissioning financial assurance directly related to the buoy, 
BSEE's regulations still require that the buoy be decommissioned (30 
CFR 285.902). BSEE expects to utilize its regulatory authority for 
decommissioning of buoys in limited circumstances.
    Comment: A commenter recommended deleting the definition of 
``engineered foundation'' from Sec.  585.600(a)(1) to ``avoid 
confusion, given that it only applies to met towers and no other 
structures.''
    Response: BOEM agrees with this approach given that the term 
``engineered foundation'' was intended to be used only in the SAP 
provisions of the rule. Therefore, this definition has been deleted in 
the final rule (Sec.  585.113) and Sec.  585.600(a)(1) is revised 
accordingly.
    Comment: A commenter suggested the following revisions to BOEM's 
proposed language in Sec.  585.600(a)(1), which provides that SAPs 
would be required only for site assessment activities involving an 
engineered foundation:
    Before you:
    Conduct any site assessment activities on your commercial lease, 
involving [delete: an engineered foundation, such as] meteorological 
towers or other facilities that are installed [add: on the seabed] 
using a fixed-bottom foundation requiring professional engineering 
design and assessment of sediment, meteorological, and oceanographic 
condition [add: as part of the design].
    You must submit, and obtain approval [strikethrough: for] of, your
    SAP [strikethrough: according to] under Sec. Sec.  585.605 through 
585.613.
    Response: BOEM agrees in part with the commenter and is revising 
Sec.  585.600(a)(1) to provide that:
    Before you:
    Conduct any site assessment activities on your commercial lease, 
involving meteorological towers or other facilities that are installed 
on the seabed using a fixed- bottom foundation requiring professional 
engineering design and assessment of sediment, meteorological,

[[Page 42610]]

and oceanographic condition as part of the design.
    You must submit, and obtain approval for your:
    SAP under Sec. Sec.  585.605 through 585.613.
    Comment: A commenter asked BOEM to consider if the definition of 
``engineered foundation'' (``means any structure installed on the 
seabed using a fixed-bottom foundation constructed according to a 
professional engineering design (based on an assessment of relevant 
sedimentary, meteorological, and oceanographic conditions))'' should be 
modified to apply to all substructures whether fixed or floating. A 
commenter raised concerns that changes to deployment requirements for 
meteorological buoys should be reconsidered, reasoning that such 
changes would limit environmental review, data collection, siting, and 
buoy removal efforts.
    Response: Met buoys have minimal environmental impact and SAPs are 
not submitted for public review. All structures, including met buoys 
and their mooring and anchors, are still required to be decommissioned 
with the seabed cleared. SAPs may be used for other purposes such as 
testing new technologies, so the standard in Sec.  585.600(a) applies 
to more than met towers. Met buoys with more complex foundations such 
as piles or suction buckets will still require an SAP if they are 
``installed on the seabed using a fixed-bottom foundation requiring 
professional engineering design and assessment of sediment, 
meteorological, and oceanographic conditions as part of the design.''
    (b) Off-lease met buoys.
    Comment: A couple of commenters opposed BOEM's proposal related to 
off-lease site assessments due to potential impacts to the environment 
and fisheries. A commenter wrote that disassociating met towers and 
buoys from leases would lead to more deployment of the devices, 
creating additional hazards for mariners as navigable waters are 
already decreased by wind farms. The commenter asked how fishermen 
would be impacted from a posited increased in the number of buoys and 
towers.
    Response: BOEM does not believe that the marginal change in 
regulatory approach BOEM has proposed will lead to an appreciable 
increase in the number of buoys and other devices deployed--either on-
lease or off-lease. Lessees are not likely to deploy any more 
meteorological buoys than are reasonably necessary to collect the data 
needed to support a project due to logistical and economic constraints. 
BOEM will continue to evaluate the effects of such deployments under 
NEPA analyses of reasonably foreseeable outcomes of the issuance of OSW 
leases. Moreover, the deployment of these devices would be subject to 
existing regulations with which other sectors of the economy engaged in 
oceanographic research must comply.
    Comment: A commenter called BOEM's proposal arbitrary and 
capricious, stating that BOEM's rationale for eliminating review for 
off-lease met buoys/towers contradicts its reasoning for continuing to 
require SAPs for on-lease met towers.
    Response: BOEM will no longer require SAPs for the deployment of 
standard buoys and off-lease met towers. However, BOEM will retain the 
requirement for on-lease activities involving ``facilities that are 
installed using a fixed-bottom foundation requiring professional 
engineering design and assessment of sediment, meteorological, and 
oceanographic conditions as part of the design.'' Likewise, BOEM 
retains the SAP requirement for on-lease met towers, because their 
potential impacts are expected to be more significant than a standard 
met buoy. In both cases, BOEM is choosing to retain the SAP requirement 
for on-lease activities that are more likely to cause impacts. This 
division reflects the relatively tenuous nexus between an off-lease met 
tower and offshore wind development and the sheer unlikelihood of 
lessees installing and using such towers. BOEM has not processed a 
limited lease request since the regulations were first promulgated in 
2009.
    Comment: Additionally, the same commenter stated that, ``BOEM's 
primary rationale for such a change to regulations regarding off-lease 
met buoys/towers is also irrational. On the one hand, BOEM states that 
it intends to accomplish this change by stating that site assessment 
activities do not produce or support energy generation. Yet its 
rationale for making the change is to accelerate OSW development.''
    Similarly, a commenter ``disagree[ed] with BOEM's finding that site 
assessment activities do not produce, transport, or support the 
generation of any energy project.'' Alternatively, a commenter agreed 
with BOEM that no lease or other authorization is required, because 
off-lease site assessment activities do not ``produce or support 
production, transportation, storage, or transmission of energy from 
sources other than oil or gas'' within the meaning of 43 U.S.C. 
1337(p)(1)(C).
    Response: These comments seem to suggest that BOEM must require 
authorizations for any activities within its statutory jurisdiction. 
However, it is neither irrational nor arbitrary for the agency to 
choose to require an authorization for activities within its 
jurisdiction that it finds more likely to be impactful, and to choose 
not to require an authorization for activities within its jurisdiction 
that it finds less likely to be impactful and that are permitted by 
other Federal agencies in compliance with Federal statutes and 
regulations. BOEM need not require leases for such buoys any more than 
it needs to require a specific authorization for buoys deployed by a 
BOEM lessee.
    Comment: A commenter stated that under the proposal, BOEM would no 
longer have the authority to deny a limited lease for off-lease met 
towers. The commenter said that under the existing requirements, 
developers must remain accountable to tribes and non-sovereign 
stakeholders who have interests in environmental protection.
    Response: BOEM agrees that, under the proposed and final rules, it 
would no longer have the authority to deny a limited lease for off-
lease met towers, because BOEM would not require a limited lease for 
such structures. However, the construction of a met tower on the OCS 
will continue to be governed by a host of Federal regulations and 
authorizations. In addition, environmental review under NEPA, 
consultations under section 106 of the National Historic Preservation 
Act (NHPA) and other authorities, as well as the need for tribal 
government-to-government consultations remain in place. Such projects 
would be subject to the same regulatory requirements as needed to 
construct a met tower for any other purpose. In particular, 
installation of a met tower on the Pacific OCS would be a very 
significant undertaking, including opportunities for input, 
participation and government-to-government consultations attendant 
thereto.
    Comment: A commenter urged BOEM to ``reconsider its proposed rule 
determining that off-lease site assessment facilities do not require a 
limited lease.'' Here, the commenter expressed disagreement with the 
agency's finding that ``site assessment activities do not produce, 
transport, or support the generation of any energy products.'' 
Referencing 88 FR 5968, 5976, the commenter asserted that site 
assessment activities, including the operation of met buoys, support 
generation of energy products. The commenter further asserted that BOEM 
makes a similar finding with respect to met towers, stating that the 
agency's ``decision not to seek to eliminate the

[[Page 42611]]

limited lease requirement for off-lease met-buoys is incongruous with 
its proposal to eliminate the limited lease requirement for off-lease 
met towers.''
    Response: BOEM acknowledges that the existing approach treats on-
lease and off-lease activities differently in some cases. Historically, 
BOEM required an authorization for on-lease buoys, but not off-lease 
buoys. The final rule standardizes the approach by not requiring an 
authorization for buoys in either case, subject to limited exceptions. 
Because buoys are preferred over towers, BOEM expects this will result 
in a consistent approach in the majority of situations--particularly on 
the Pacific OCS where deeper water will favor the preference for met 
buoys over towers even more strongly.
    BOEM agrees with the commenter that site assessment activities like 
buoys and towers may support the generation of electricity or other 
energy product, and Sec.  585.104 is revised accordingly. Historically, 
BOEM would require an authorization for on-lease met towers, and off-
lease towers if their purpose was to support OSW. In practice, BOEM has 
received very few proposals for an on-lease met tower, and no proposals 
for off-lease met towers. Under the revised regulations, BOEM will 
require an approved SAP for on-lease met towers, but not off-lease met 
towers. BOEM believes that requiring an SAP for on-lease met towers is 
justified because potential environmental impacts of met towers and 
facilities with engineered foundations are both more variable and more 
significant for certain marine resources. However, BOEM is not 
requiring an SAP for off-lease met towers because the nexus between an 
off-lease met tower and offshore wind is likely to be more attenuated 
than an on-lease met tower. Also, BOEM estimates that such towers are 
likely to be so uncommon as not to merit specific treatment under our 
regulations.
    Comment: A commenter requested clarification on the review process 
and timeline for off-lease site assessment activities. The commenter 
said that these activities, particularly met buoys, may have 
significant impacts to features including natural hard bottoms and 
artificial reefs. The commenter stated that State agencies must be 
given sufficient opportunity to review activities due to potential 
impacts on bat and bird migrations.
    Response: USACE evaluates applications to install met buoys on a 
case-by-case basis. An application for a USACE authorization would 
require compliance with the same Federal environmental laws (e.g., the 
Endangered Species Act) applicable to BOEM's SAPs; that compliance may 
result in measures to avoid or minimize impacts to environmental 
resources.
    Comment: Multiple commenters discussed the limited opportunities 
for State engagement and public participation if the proposal is 
finalized. A commenter stated that BOEM should clarify how off-lease 
site assessment facilities will be managed where USACE's NWPs are 
suspended due to regional conditions. The commenter also recommended 
that BOEM provide a grace period prior to implementation to align with 
State and USACE permit renewals and provide time for states to 
coordinate procedural matters with USACE districts.
    Response: Under the current regulatory regime for the OCS, off-
lease site assessment activities may occur without BOEM approval and 
with USACE authorization (under either a nationwide, regional or 
general permit) unless the purpose of the activities is to collect data 
for renewable energy, in which case BOEM makes a case-by-case 
determination as to whether a lease and GAP would be required. Given 
that this distinction is only about the purpose of the data collection, 
rather than the type of activities or their potential impacts, BOEM 
cannot justify the higher burdens placed solely on those interested in 
site assessment data to inform renewable energy. This suggests BOEM 
should either require an SAP for all buoys, regardless of the purpose 
for which they are proposed, or none. However, because OCSLA would not 
permit BOEM to regulate buoys installed regardless of purpose (and 
because there is another agency with precisely that mandate), we have 
opted not to regulate buoys. Further, BOEM disagrees that the proposal 
will result in limited opportunities for State and public participation 
in BOEM's process, as a large number of public engagement opportunities 
remain \10\ and will continue under the final rule. BOEM coordinates 
extensively with states and consults with State authorities through 
BOEM's Intergovernmental Task Forces and through regular ad hoc 
meetings. Opportunities for public engagement are likewise plentiful; 
BOEM typically holds dozens of meetings with different stakeholder 
groups, both virtual and in-person, as well as public comment 
opportunities associated with the RFI, the Call, the draft Area 
Identification, scoping for the lease sale Environmental Assessment, 
PSN, and scoping for the project EIS. The Department coordinated the 
finalization of this provision with USACE. Given that USACE has a well-
established permitting program and because the Department is providing 
regulatory relief with this final rule, BOEM does not find a grace 
period to be necessary. Applicants who wish to deploy off-lease site 
assessment facilities to collect data for renewable energy can follow 
the existing well-established USACE processes to obtain general or 
individual permits, as appropriate. Where a general permit is not 
available, the USACE district may evaluate activities under an 
individual permit.
---------------------------------------------------------------------------

    \10\ See A Citizen's Guide to the Bureau of Ocean Energy 
Management's Renewable Energy Authorization Process, Dec. 2016, 
available at https://www.boem.gov/sites/default/files/renewable-energy-program/KW-CG-Broch.pdf.
---------------------------------------------------------------------------

    Comment: A commenter recommended the following revisions to the 
rulemaking text:
     Sec.  [thinsp]585.611: Clarify that information about 
sites that have religious or cultural significance to Tribes, including 
viewsheds and traditional cultural landscapes and properties, must be 
included with the information an applicant must submit with an SAP to 
assist BOEM in complying with NEPA and other applicable laws.
     Sec.  [thinsp]585.617: Paragraph (e)(1) should be revised 
to add ``culturally significant sites, including viewsheds and 
traditional cultural landscapes and properties; or subsistence rights 
of a federally-recognized Tribe.''
     Sec.  [thinsp]585.606: Paragraph (e) should be revised to 
add ``culturally significant sites, including viewsheds and traditional 
cultural landscapes and properties; or subsistence rights of a 
federally recognized Tribe.''
    Response: BOEM reviewed these requests for additions to BOEM's SAP, 
COP, and GAP requirements, and determined that BOEM's regulations, as 
amended in this final rule, will require this information to be 
included in such plans. The regulations in 30 CFR 585.627 require 
lessees to submit detailed information and analysis ``to assist BOEM in 
complying with NEPA and other applicable laws.'' This includes 
information about ``archaeological resources use, or historic property 
use, Indigenous traditional cultural use, or use pertaining to treaty 
and reserved rights with Native Americans or other Indigenous peoples, 
including required information to conduct review of the [plan] under 
the NHPA or other applicable laws or policies, including treaty and 
reserved rights with Native Americans or other Indigenous peoples.''
    We have not adopted the precise wording proposed in the comment, 
but we believe the language, as revised, will achieve the same result.

[[Page 42612]]

3. What is the Department finalizing?
    (a) Sec.  585.104 Do I need a BOEM lease or other authorization to 
produce or support the production of electricity or other energy 
product from a renewable energy resource on the OCS?
    This rule finalizes that off-lease site assessment facilities would 
not require a limited lease and the Department would not conduct any 
case-by-case determinations regarding whether off-lease site assessment 
activities require a lease. This applies to both met buoys and met 
towers. This final rule does not adopt the language from the proposed 
rule stating that, ``for purposes of this section, site assessment 
activities are not considered to produce, transport, or support the 
generation of any energy products; and, therefore, such activities do 
not, by themselves, require a lease, easement or ROW.'' (88 FR 5992) 
That language implied that such activities would not be covered under 
BOEM's authority under OCSLA. While it is true that in this rule, BOEM 
has excluded buoys from the description of activities for which an 
approved SAP would be required, it would be an overstatement to say 
that such activities do not support the generation of energy. Please 
refer to Section V of this preamble for a detailed discussion on this 
section.
    (b) Sec.  585.113 Definitions.
    BOEM is not including its proposed definition of ``engineered 
foundation'' in the final rule because the definition was intended to 
be used only in the SAP provisions of the rule. However, the final rule 
retains the same standard (meteorological or other facilities that are 
installed on the seabed using a fixed-bottom foundation requiring 
professional engineering design and assessment of sediment, 
meteorological, and oceanographic conditions as part of the design) in 
30 CFR 585.600 for determining whether an SAP is needed for proposed 
site assessment activities on a commercial lease.
    (c) Sec.  585.600 What plans must I submit to BOEM before I conduct 
activities on my lease or grant?
    BOEM is finalizing this portion of the rule about site assessment 
facilities as proposed in Sec.  585.600. BOEM concludes that its 
previous SAP requirement was unreasonably burdensome and redundant with 
some of USACE's permit process and, therefore, unnecessary. Under the 
final rule, lessees would deploy a met buoy following the existing 
well-established USACE processes to obtain a general or individual 
permit, as appropriate. USACE permits may be subject to regional and 
special conditions, and the requirements for deploying a buoy may vary 
regionally. The USACE permitting authority stems from section 10 of the 
RHA and section 404 of the Clean Water Act (CWA). Under these 
authorities, the USACE renders decisions for certain offshore 
activities affecting navigable waters.\11\ BOEM does not anticipate 
gaps in Federal oversight of met buoys deployed for measuring renewable 
energy resources will result from this rulemaking. Equivalent met buoys 
and other scientific research buoys deployed for reasons unrelated to 
BOEM's OCSLA authority are already deployed routinely under other 
Federal authorities and programs, including NOAA's National Data Buoy 
Center program. BOEM is retaining the SAP process for facilities 
installed on a commercial lease using a fixed-bottom foundation 
constructed according to a professional engineering design (based on an 
assessment of relevant sedimentary, meteorological, and oceanographic 
conditions), including met towers.
---------------------------------------------------------------------------

    \11\ Including the extension of the RHA to the limits of the 
outer continental shelf by the Outer Continental Shelf Lands Act at 
43 U.S.C. 1333(a)(1).
---------------------------------------------------------------------------

    (d) Sec.  285.900 Who must meet the decommissioning obligations in 
this subpart?
    BOEM coordinated extensively with the USACE to ensure adequate 
regulatory coverage for met buoys on the OCS. For example, on 
decommissioning, BOEM anticipates that met buoys permitted under USACE 
authority will be subject to USACE decommissioning requirements, as 
applicable. However, to provide a backstop, BSEE revised its 
decommissioning regulations to ensure that if, in the event, USACE does 
not impose decommissioning requirements on a met buoy, BSEE retains the 
authority to require it to be safely decommissioned. BSEE expects to 
utilize its regulatory authority for decommissioning of buoys in 
limited circumstances.

B. Project Design Envelope

1. What did the Department propose?
    (a) Sec.  585.112 Definitions.
    BOEM proposed to add a definition for ``Project Design Envelope 
(PDE)'' as part of its proposal to codify the use of a PDE throughout 
the NPRM subpart F (Plans and Information Requirements). The NPRM 
proposed to add language to include the use of a PDE, which includes a 
range of design parameters and construction and operation activities. 
The NPRM also proposed the addition of language to clarify the ability 
of lessees and grantees to submit plans using a PDE. The use of a PDE 
is a proven approach to provide lessees and grantees with flexibility 
throughout the permitting process while still complying with NEPA and 
other statutory and regulatory obligations.
    (b) Sec.  585.610 What must I include in my SAP?
    The NPRM proposed that SAP information may be provided using a PDE 
with BOEM reserving the right ``to determine what range of values for 
any given parameters are acceptable.''
    (c) Sec.  585.626 What must I include in my COP?
    The NPRM proposed that COP information may be provided using a PDE 
with BOEM reserving the right ``to determine what range of values for 
any given parameters are acceptable.''
    (d) Sec.  585.645 What must I include in my GAP?
    The NPRM proposed that GAP information may be provided using a PDE 
with BOEM reserving the right ``to determine what range of values for 
any given parameter are acceptable.''
2. What are the key public comments?
    Comment: Some commenters asserted that the proposed PDE approach 
does not provide enough detailed information for various stakeholders, 
such as fishing communities, the public, or permitting and consulting 
agencies, to provide meaningful evaluation of potential impacts and 
conduct Federal consistency reviews.
    A couple of commenters suggested that mitigation measures should be 
defined and made clear in the PDE. A commenter said that stakeholders 
cannot effectively comment on unclear mitigation measures, nor can the 
effectiveness of such mitigation measures be evaluated.
    A commenter stated that BOEM should be allowed to provide direction 
and articulate preferences for products, mitigation approaches, and 
installation methods included in the PDE. The commenter discussed the 
need to examine the range of impacts that could occur within the PDE, 
not just the maximum, to identify technologies and approaches that 
provide benefits or lessen the impact of a project. The commenter 
warned that a PDE approach may undermine meaningful public evaluation 
of likely design parameters if there are other contractual obligations 
in place to use a specific technology from States or other sources.
    Response: BOEM's existing EIS analyses use several methods to 
ensure sufficiently detailed information is provided to stakeholders 
about the range of impacts that may occur from a project that uses a 
PDE. For example, BOEM may develop comparisons between different 
options within a PDE

[[Page 42613]]

as part of the reasonable range of alternatives analyzed in detail in a 
COP EIS. This analysis of alternatives allows for comparison of impacts 
across design options within the PDE (e.g., foundation type) that 
inform the public about the trade-offs between different technologies. 
Moreover, the maximum impact scenario is not necessarily the same for 
every resource, thus, BOEM's EISs typically assess impacts from a 
variety of designs, techniques, layouts, and cable routes within the 
PDE.
    Comment: One commenter voiced support for the proposal but 
requested that BOEM remove the language in Sec.  585.626(a) that ``BOEM 
reserves the right to determine what range of values for any given 
parameter are acceptable.'' Another commenter stated that BOEM should 
provide guidance on the range of parameters it is prepared to review 
through the process rather than requiring multiple rounds of PDE 
submissions to narrow the scope. The commenter suggested a new 
interagency memorandum of understanding under which consulting agencies 
align and prepare to complete their review processes and avoid 
utilizing PDEs as a tool for crafting EIS analyses from a range of 
component options.
    Response: BOEM needs the authority to review and request revisions 
to a PDE that is unreasonably broad or vague. For example, BOEM may 
request a revision when the PDE is too broad to be effectively analyzed 
by NEPA or consulted upon with another agency, or there is not enough 
detail in the COP to ensure sufficient safety and technical feasibility 
to support a COP approval. The PDE approach is considered necessary to 
allow for rapidly changing technologies in OSW. BOEM can use updated 
COP and PDE Guidelines to set recommended limits on the PDE.
3. What is the Department finalizing?
    (a) Sec.  585.113 Definitions.
    BOEM is finalizing the definition of PDE as proposed. The final 
rule will clarify the process for lessees and other stakeholders by 
explicitly integrating PDE principles into the regulatory text, 
primarily by referencing ``ranges'' of design parameters or locations. 
In this final rule, BOEM recognizes that a PDE should not be overly 
broad to avoid not defining the project well enough for meaningful 
analysis.
    (b) Sec.  585.610 What must I include in my SAP?
    BOEM is finalizing that SAP information may be provided using a PDE 
with BOEM reserving the right ``to determine what range of values for 
any given parameter are acceptable.''
    (c) Sec.  585.626 What must I include in my COP?
    BOEM is finalizing that COP information may be provided using a PDE 
with BOEM reserving the right ``to determine what range of values for 
any given parameter are acceptable.''
    (d) Sec.  585.645 What must I include in my GAP?
    BOEM is also finalizing that GAP information may be provided using 
a PDE with BOEM reserving the right ``to determine what range of values 
for any given parameter are acceptable.''

C. Geophysical and Geotechnical Surveys

1. What did the Department propose?
    (a) Sec.  585.626 What must I include in my COP?
    The NPRM proposed to provide more flexibility and clarify existing 
flexibility in COP requirements. BOEM proposed to shift the 
geotechnical survey and data collection requirements from the largely 
prescriptive standards to performance-based standards. These 
performance-based standards would give lessees the leeway to 
demonstrate that their selected combination of geotechnical and 
geophysical surveys would provide BOEM the data at the COP review stage 
to determine whether the project as designed could be constructed 
safely in the proposed range of locations. Lessees could then determine 
their own balance between geotechnical and geophysical surveys at the 
COP stage. Through a COP sufficiency determination, BOEM would still 
ensure that the COP contains information sufficient to complete its 
environmental review and required consultations.
    BOEM proposed to allow the submission of geotechnical data for an 
engineering assessment of the proposed turbine foundations with a 
lessee's FDR in lieu of the results of in situ boring and sampling at 
each foundation location in the COP.
    The NPRM also proposed to grant the Department the flexibility to 
allow a lessee to submit subsea archaeological surveys at the FDR stage 
on a case-by-case basis, subject to terms and conditions of COP 
approval.
    The proposal put forward clarifications that the COP must still 
have the information sufficient to define the baseline geological 
conditions of the seabed and provide sufficient data to develop a 
geologic model, assess geologic hazards, and determine the feasibility 
of the proposed site. The proposal also stated that the vast majority 
of the data that would be deferred to the FDR and Fabrication and 
Installation Report (FIR) stage is used solely for engineering 
purposes. If the COP needs to be modified as a result of information 
gathered from the deferred surveys, the Department would require the 
lessee to revise the COP under the regulations at Sec.  585.634. The 
Department believed that the proposed changes introduced flexibilities 
and would enhance the Department's (and lessees') ability to respond to 
environmental and ocean-user concerns raised during its environmental 
reviews by modifying the project design.
    (b) Sec.  585.645(b) What must I include in my GAP?
    The NPRM proposed similar changes to the General Activities Plan 
(GAP) requirements for limited leases and grants to be consistent with 
the proposed changes to COP data requirements. Specifically, the NPRM 
proposed revisions of the geotechnical, shallow hazards and geological 
survey information requirements in the GAP at Sec.  585.645(a).
    (c) Solicitation of comments concerning a potential new permit 
requirement for conducting geological and geophysical surveys for 
renewable energy activities.
    BOEM considered whether there was a need for a future rulemaking 
intended to regulate surveys associated with OCS renewable energy 
activities. To that effect, the proposed rule solicited comments on the 
following questions:
    What additional protections might be gained through rulemaking that 
cannot be achieved by way of the lease stipulations?
    Should BOEM establish a permit-based mechanism to regulate surveys? 
And to what extent, if any, should that permit program differ from the 
permit requirements of the oil and gas program and marine minerals 
program?
    Is there another mechanism that could aid in the confirmation of 
any damage to fishing gear as well as the identification of responsible 
parties for any such damage from survey activities?
    To what extent should BOEM require additional public reporting and 
notice of any anticipated OCS survey activities? Is there a greater 
need for specific advance notice requirements to include the location, 
dates, and times in which other OCS surveys will be conducted?
    To what extent should BOEM identify and track OCS survey activities 
related to renewable energy program activities?
    How can BOEM improve the current procedures for reporting by and 
reimbursement of any party that might be negatively impacted by the 
activities in renewable energy survey activities? Can these 
improvements replace the need to promulgate regulations

[[Page 42614]]

governing OCS surveys for renewable energy projects?
    Should BOEM require advance coordination of survey activities with 
other lessees operating on the OCS?
    Are there other policies or requirements that BOEM should consider 
to minimize the adverse interaction between those conducting surveys 
and other users of the OCS?
2. What are the key public comments?
    (a) COP data requirements.
    Comment: Several commenters supported the proposed changes allowing 
certain archeological data to be submitted with the FDR and indicated 
this would save time and money by eliminating the need to collect more 
data than is necessary due to uncertainties in design. One commenter 
suggested that BOEM offer two submittals for developers to: (1) submit 
archeological survey information at the COP stage and (2) provide other 
survey information at a later date on a component-by-component basis. 
However, another commenter opposed the flexibility for the completion 
of archeological surveys. Several commenters argued that if 
archeological resource surveys are allowed to be deferred, BOEM should 
work to facilitate agreements or memoranda of understanding among 
National Historic Preservation Act (NHPA) section 106 consulting 
parties to establish strong communication and design mitigation 
approaches.
    Response: Based on comments received, BOEM will continue to require 
archeological surveys and analyses to be conducted prior to the FDR/FIR 
stage because sufficient geophysical data is necessary to assess 
potential impacts from offshore wind activities on cultural resources 
and the introduction of a case-by-case deferral of certain marine 
archaeological surveys would have created uncertainty for all parties 
participating in consultations conducted according to section 106 of 
the NHPA.
    Comment: Several commenters suggested that BOEM should set specific 
regulatory timelines for the COP review process, including a 20-day 
preliminary review, a matrix of the subject matter expert comments 
within 45 days, and an updated FAST-41 dashboard for communication with 
project developers. A commenter also recommended that developers should 
be required to begin consultation with State programs as early as 
possible, not just upon the issuance of the Draft EIS, and should be 
required to include the results of this consultation to State coastal 
programs, fisheries users, and other coastal and marine users, as part 
of the COP.
    Response: In August 2023, BOEM released final guidance, entitled 
Information Needed for Issuance of a Notice of Intent (NOI) Under the 
National Environmental Policy Act (NEPA) for a Construction and 
Operations Plan (COP), which establishes a non-binding framework 
similar to the regime proposed by the commenter. BOEM prefers to focus 
on implementing the current guidance, with its inherent flexibilities, 
adaptability, and exceptions, as opposed to issuing a formal, rigid 
rulemaking to address these issues.
    Comment: One commenter stated, ``BOEM proposes to clarify the 
language of Sec.  585.627 concerning the information to be submitted 
alongside the COP, not to satisfy OCSLA but to assist BOEM in complying 
with other statutory responsibilities, including NEPA.'' The commenter 
also found it notable that BOEM stated, ``[t]he non-geotechnical survey 
data included in the COP submittal are more than adequate to assess 
impacts to the human, marine, and coastal environment, to conduct 
necessary statutory consultations, and to show technical feasibility of 
all proposed foundation types.''
    The commenter supported the proposed clarifications and further 
recommended revising the regulation to focus the requirement on 
information regarding the potential for significant impacts. They 
stated that doing so would be consistent with NEPA and the NHPA, as 
well as various species-protection statutes that require interagency 
consultation. The commenter stated that tailoring the information to 
the statutory need would assist both BOEM and the COP applicant to 
manage their shared responsibilities for developing data and analyses.
    Response: BOEM incorporated responsive edits into Sec.  585.627(a) 
in the final rule because they more accurately mirror the text in the 
NEPA statute and regulations, which focus on significant effects of a 
Federal action. BOEM added the phrase ``(or the potential significance 
of the effect is unknown)'' to fully reflect Sec. 106 of NEPA, as 
amended by the Fiscal Responsibility Act of 2023. BOEM also added the 
phrase ``or such information is otherwise required by another statute 
or regulation'' to emphasize that some of the requirements in Sec.  
585.627(a) are subject to additional authorities beyond NEPA, which may 
require the submission of additional information. BOEM also made 
parallel edits to the relevant SAP regulations at Sec.  585.611(b) and 
the relevant GAP regulations at Sec.  585.646(a)-(b) because BOEM's 
plan requirements have parallel structures regarding NEPA. To 
illustrate the edits made, the regulatory text in the final rule for 
Sec.  585.627(a) provides, in part, that your COP must contain detailed 
information and analysis necessary to assist BOEM in complying with 
NEPA and other applicable laws. Your COP must contain information about 
those resources, conditions, and activities listed in the table in 
paragraph (a) that your proposed activities may significantly affect, 
or that may have a significant effect on your proposed activities 
(including where the potential significance of the effect is unknown) 
and must contain any other information required by law.
    Comment: A commenter expressed support for the proposal to submit 
some archaeological surveys with the FDR, stating that this would 
reduce vessel time in the water and associated environmental impacts. 
The commenter stated that the requirement to submit geotechnical 
surveys at each foundation location at COP submittal is ``at best 
unrealistic and premature and at worst wasteful and inefficient,'' 
because ``only some geotechnical survey[s] together with geophysical 
and archaeological surveys are necessary to inform the public 
environmental review process.'' Another commenter requested that BOEM 
provide more detail about which surveys would be acceptable at the pre-
COP stage to avoid duplicative survey work.
    Response: The final rule clarifies which surveys are acceptable at 
the pre-COP stage and which surveys are acceptable at the FDR/FIR 
stage. Specifically, in the final rule geophysical survey data is 
required at each foundation and cable location in the COP to develop 
the geologic model as well as for environmental reviews. In addition, 
while the NPRM would have allowed deferral of some geophysical surveys, 
BOEM declined to carry forward that proposal in the final rule.
    Consistent with the proposed rule, under the final rule 
geotechnical data at each foundation location can be deferred to FDR 
for final foundation design provided the data submitted in the COP is 
otherwise sufficient for evaluation of geologic hazards and foundation 
feasibility. Final assessment of geohazards and feasibility may be 
deferred to the FDR stage by the lessee, at which time this information 
will also be subject to review and certification by the CVA. 
Consequently, the current requirement to submit site-specific 
geotechnical data at the COP stage under 30 CFR 585.626(a) is modified 
by both agencies in this final rule. Consistent with the proposed rule, 
BSEE

[[Page 42615]]

and BOEM are relocating review of this site-specific data from 30 CFR 
585.626(a) to 30 CFR 285.700(b) and (c).
    Comment: A commenter expressed disagreement with the note in the 
proposed rule suggesting that delayed archaeological surveys could 
lengthen the NHPA section 106 review process. The commenter asserted 
that the proposed rule is in line with industry standards and suggested 
that BOEM clarify in the final rule whether any supporting 
documentation would be required to get a survey strategy approved under 
the performance-based standard. The commenter also suggested that BOEM 
clarify in the final rule that phased geotechnical identification 
represents a reasonable and good faith effort under the NHPA and future 
project-specific Memoranda of Agreement and Programmatic Agreements 
should include stipulations related to post-review discoveries. The 
commenter also recommended that BOEM match the cultural resources 
survey requirement language for GAPs to the corresponding requirement 
language for COPs.
    Response: BOEM's NPRM Sec.  585.626(b)(3) stated that ``[o]n a 
case-by-case basis and subject to terms and conditions of COP approval 
per Sec.  585.628(f), BOEM may permit you to submit certain surveys of 
the subsea portions of the area of potential effects with your FDR per 
Sec.  585.701(a)(11).'' Upon further consideration of comments 
received, particularly from federally recognized Tribes, BOEM is 
eliminating this language. BOEM agrees that sufficient geophysical data 
is necessary to assess potential impacts from offshore wind activities 
on cultural resources and the introduction of a case-by-case deferral 
of certain marine archaeological surveys could create uncertainty for 
some parties participating in consultations conducted according to 
section 106 of the NHPA. BSEE has removed the referenced regulatory 
text in Sec.  585.701(a).
    Comment: A commenter suggested developers be allowed to submit 
geophysical data pertaining to inter-array cables (IACs) after the COP, 
at the FDR/FIR Stage because the IAC layout is uncertain until the 
turbine generators have been selected, and delaying submission would 
allow for targeted collection of data.
    Response: Developers may request a departure for submitting 
geophysical survey data for IACs and BOEM will evaluate the request 
based on the site-specific conditions and project details.
    Comment: A commenter suggested BOEM establish a de minimus 
threshold or more specific details for when project revisions after a 
COP approval are needed as the current proposed text is broad. The 
commenter further stated that COP revisions should not be required 
unless the changes occur outside of the PDE. A commenter proposed 
detailed regulatory text changes to several sections including 
additional review actions BOEM may take in relation to a COP that 
proposes to develop a lease in phases or segregate a lease, changes to 
the activities that trigger a revision to the COP and the timeline for 
approval, and the timing to commence operations on a commercial lease.
    Response: While a de minimis threshold has not been specifically 
added to Sec.  585.617, Sec.  585.634, or Sec.  585.655, as the 
provision in the final rule reads, minor deviations from an approved 
SAP, COP, or GAP should not require a plan revision. BOEM added a 
reference to the PDE as relevant to a determination of whether a 
revision is required. BOEM selectively adopted part of the 
recommendation regarding phased development in Sec.  585.238 (which 
appeared as Sec.  585.629 in the NPRM) by accepting the recommendation 
regarding conditioned approvals that account for subsequent phased 
development. BOEM protected its discretion by adding that it may take 
other actions within its authority, but determined that the proposed 
revision specifying that BOEM may ``bifurcate its pending review of a 
Plan where a lease is segregated'' was potentially confusing.
    (b) Other comments on policies or requirements BOEM should consider 
related to geophysical or geotechnical surveys.
    Comment: Several commenters expressed concern that proposed changes 
to survey requirements may result in less information being available 
at the earliest stages of leasing and permitting and would affect 
consulting parties' review of proposed projects. One such commenter 
recommended revising Sec.  [thinsp]585.103(a)(4) by adding, 
``culturally significant sites, including viewsheds and traditional 
cultural landscapes and properties, and subsistence rights of a 
federally-recognized Tribe'' at the end of the paragraph.
    Response: The concerns expressed in this comment are noted and 
well-received. BOEM will not, as proposed in the NPRM, modify existing 
requirements for geophysical survey results to be submitted with the 
COP. Consistent with the proposed rule, the final rule permits deferred 
submittal of site-specific deep borings from geotechnical surveys. 
However, the geotechnical surveys that may be deferred are not 
necessary to assess impacts to cultural or other environmental 
resources.
    Comment: A couple of commenters stated that industry should be 
required to share geological and geophysical data from exploratory 
surveys. A commenter discussed OCS sand resources for beach nourishment 
projects and requested that BOEM balance lease issuance with non-energy 
uses. The commenter expressed concern that BOEM's mandate to protect 
sand resources is not given equal importance as its role in energy. The 
commenter stated that internal and external agency coordination for 
sand resources is needed to conduct a baseline assessment on sediment 
resources. The commenter also requested that BOEM define ``competing 
uses'' to include a phrase like ``such as offshore sand resources.''
    Response: BOEM understands that the survey data generated by 
offshore developers is of great interest to other communities, 
including academic communities and those investigating other resources, 
such as sand and mineral resources. Such issues must be weighed against 
developers' justifiable business interest in keeping information 
confidential that has been developed at great cost. BOEM agrees with 
the importance of understanding the implications to all offshore 
resources. The provisions of 30 CFR 585.626 and 585.627, and 585.645 
and 585.646 (equivalent in COP and GAP frameworks) ensure that lessees 
and ROW holders will evaluate and describe the implication to offshore 
resources as part of plan preparation.
    Comment: A commenter said that BOEM should consider requiring 
compensation to the commercial fishing industry as mitigation for the 
impacts of site investigations on vessels and gear. A commenter said 
that BOEM should acknowledge that noise produced from survey equipment 
may result in temporary decreased catch rates.
    Response: BOEM is actively pursuing mechanisms to promote the 
compensation of impacted fishers. BOEM is aware of potential impacts to 
the fishing industry as a result of noise produced from survey 
equipment. The agency has devoted significant resources to avoiding and 
minimizing potential impacts and will continue to do so outside of the 
current rulemaking process.
3. What is the Department finalizing?
    (a) Sec.  585.626 What must I include in my COP?
    BOEM is finalizing its proposal to allow submission of the results 
of in situ

[[Page 42616]]

boring and sampling at each foundation location with a lessee's FDR, in 
lieu of requiring that information to be included in the COP. To 
effectively implement this rule, BOEM revised the recommended level of 
geotechnical data required in the COP to match the scope described in 
BOEM report 2018-054 by DNV.\12\ BOEM requires this level of data in 
each COP to ensure there is sufficient data and analysis for evaluation 
of geologic hazards and a foundation feasibility assessment.
---------------------------------------------------------------------------

    \12\ See https://www.boem.gov/sites/default/files/environmental-stewardship/Environmental-Studies/Renewable-Energy/Data-Gathering-Process.pdf.
---------------------------------------------------------------------------

    However, BOEM decided against allowing geophysical surveys to be 
deferred on a case-by-case basis. With this final rule, BOEM will not 
allow a lessee to submit the results of certain detailed subsea 
archaeological surveys with the FDR. BOEM reasoned that sufficient 
geophysical data is necessary to assess potential impacts from offshore 
wind activities on cultural resources and the introduction of a case-
by-case deferral of certain marine archaeological surveys would create 
uncertainty for all parties participating in consultations conducted 
according to section 106 of the NHPA. Under the final rule, geophysical 
survey data continues to be required in the COP to develop the geologic 
model as well as for environmental reviews. BOEM also determined that 
sufficient geophysical data is necessary to assess potential impacts 
from offshore wind activities on cultural resources and the 
introduction of a case-by-case deferral of certain marine 
archaeological surveys creates uncertainty for all parties 
participating in consultations conducted pursuant to section 106 of the 
NHPA. Finally, BOEM considered concerns raised by federally recognized 
Tribes who opposed deferring submittal of geophysical data to the FDR 
stage.
    (b) Sec.  585.645(b) What must I include in my GAP?
    BOEM is finalizing its proposed revisions of the geotechnical, 
shallow hazards and geological survey information requirements in the 
GAP regulations at Sec.  585.645(a). To effectively implement this 
rule, BOEM revised the recommended level of geotechnical data required 
in the GAP to match the scope described in BOEM report 2018-054 by 
DNV.\13\ BOEM requires this level of data in each GAP to ensure there 
is sufficient data and analysis for evaluation of geologic hazards and 
a foundation feasibility assessment.
---------------------------------------------------------------------------

    \13\ See https://www.boem.gov/sites/default/files/environmental-stewardship/Environmental-Studies/Renewable-Energy/Data-Gathering-Process.pdf.
---------------------------------------------------------------------------

    (c) Sec.  285.701 What must I include in my Facility Design Report?
    BOEM is finalizing its proposed revisions that would defer the 
submission of some geotechnical information, previously submitted as 
part of the COP--or GAP for facilities deemed complex and significant--
to be submitted as part of the FDR under Sec.  285.701(a)(10).

D. 30 CFR part 285, subpart G, Certified Verification Agent and 
Engineering Report

1. What did the Department propose?
    (a) Sec. Sec.  285.700 through 285.710, 285.712, and 285.714 
Improving the project design and fabrication/installation verification 
process.
    BOEM and BSEE concurrently review reports for design and 
construction of the facilities on the OCS. Rather than relying solely 
on agency engineering expertise, the agencies also require lessees to 
use a CVA to provide independent third-party review of a project's FDR 
and FIR. The NPRM addressed the CVA's integral role in determining that 
a proposed OCS renewable energy facility is designed and constructed 
safely using best engineering practices in accordance with Sec. Sec.  
[thinsp]285.707 and 285.712. The CVA would also be expected to monitor 
fabrication and installation activities and to submit a final report to 
BOEM and BSEE, as applicable, before the start of commercial operations 
or other approved activities in accordance with Sec. Sec.  
[thinsp]285.637(a)(2) and (3) and 285.708-285.712.
    Under the proposed rule Sec.  285.708(a)(2) and (b), the CVA would 
be required to evaluate the commissioning of any Critical Safety 
Systems and Equipment, such as equipment designed to prevent or reduce 
major accidents that could result in harm to health, safety, or the 
environment associated with facilities. The NPRM proposed to add 
flexibility to the CVA nomination process. Currently, a lessee or a 
grantee must submit its CVA nominations with its SAP, COP, or GAP. In 
the NPRM, the Department would approve or disapprove CVA nominations as 
part of its plan review. Multiple lessees have expressed a desire to 
have an approved CVA in place before COP submittal so the CVA may 
provide third-party review of design concepts in the COPs. This 
reasoning also supports CVA review of SAPs and GAPs before submittal.
    The Department has concluded that integrating CVA review into the 
earliest stages of the design and permitting process is consistent with 
its policy goals of encouraging safety and best engineering practices. 
We also recognize that a lessee or a grantee may need to nominate new 
CVAs as the project progresses (for instance, if a design parameter 
changes at a later stage) or to request replacement of an approved CVA 
if that CVA is ineffective or can no longer perform their duties. As a 
result, the proposed rule would have provided flexibility for the 
Department, lessees, and grantees by decoupling the CVA nomination and 
approval process from plan submittal and approval. The proposed rule 
also clarified that a lessee or a grantee could nominate separate CVAs 
to review different components of a project.
    A CVA provides independent third-party review of a project's 
design, fabrication, and installation. The proposed rule would expand 
the CVA's role to include verification of the design, fabrication, and 
installation of the Critical Safety Systems and Equipment to assist the 
Department in meeting requirements of OCSLA and its implementing 
regulations to ensure that any authorized activities are carried out 
safely. The Department's existing regulations require CVAs to 
``certify'' projects, and the Department supports this approach as 
applied to the FDR and FIR stages of wind power development.
2. What are the key public comments?
    (a) Purpose, Role, and Scope of CVA.
    Comment: Several commenters expressed disagreement with the 
proposed changes to the CVA requirements, stating that the changes may 
lead to a reduction in safety and recommending that the Department 
carefully consider concerns about impacts to mariners. A commenter 
stated opposition to the proposed waiver process for a CVA and use of a 
lessee's engineer as they viewed the project engineer designation as a 
lessening of responsibility and could produce conflicts of interest in 
reviewing components. Another commenter opposed the use of multiple 
CVAs for various components insofar as it could lead to inconsistencies 
in the verification of a project. Finally, a commenter opposed the 
changes in the ``verification'' and ``certification'' language, 
suggesting that these changes would not be in line with industry 
standards.
    Response: CVA roles and responsibilities are now regulated by BSEE. 
BSEE defines the role of the CVA in Sec. Sec.  285.707 and 285.708. 
Changes to the rule on CVA roles and responsibilities will not reduce 
the level

[[Page 42617]]

of safety on a project and will not reduce the safety of mariners or 
other OCS users. The CVA must meet BSEE requirements for qualifications 
and experience, and their scope of work will address safety concerns 
through commissioning of the facility. Waiver requirements were already 
included in the regulations. Any waiver of the CVA requirement will be 
rigorously reviewed to ensure there is no reduction in safety prior to 
accepting the use of a project engineer. The final rule adds stricter 
requirements for project engineers when a waiver is requested. If 
multiple CVAs are used on a project, BSEE will require one CVA to 
oversee the entire facility design, fabrication, and installation and 
to ensure continuity across all project components.
    BSEE understands that the terms ``verification'' and 
``certification'' are not consistently defined across published 
standards. Accordingly, BSEE is defining each term based on the Oxford 
Dictionary and contextual usage in relevant standards. The terms 
``certify'' or ``certification'' describes how the CVA ``recognizes 
that (someone or something) possesses certain qualifications or meets 
certain standards.'' BSEE may thus require a CVA to ``certify'' that a 
design or safety component conforms to a defined certification protocol 
based on criteria from specific quality assurance standards or 
recognized accepted engineering practices. The terms ``verify'' or 
``verification'' describes how the CVA demonstrates that something is 
true, accurate, or justified. BSEE has evaluated each of the CVAs 
actions, as required by the regulations, and updated the regulations to 
use the appropriate term.
    Comment: Multiple commenters favored the proposed changes to CVA 
requirements. Several commenters expressed support for the proposed 
revisions to the role of a CVA, stating that the revisions align with 
best engineering practices and BOEM and BSEE policy goals of 
encouraging safety. One commenter stated support for the inclusion of 
flexibility, pragmatism, durability, and performance-based standards 
and suggested that the Department include a supporting discussion in 
the preamble detailing the approach to these concepts. A commenter 
expressed support for the CVA role revisions and the approval of CVA 
nomination prior to COP submittal to create flexibility for both 
lessees and the Department.
    Response: BSEE has determined that reliance on CVAs will provide an 
independent source of review for key stages of project development and 
help to establish public confidence in the renewables industry. BSEE 
defines the role of the CVA in Sec. Sec.  285.707 through 285.712. CVAs 
play a role throughout the development of a project, including design, 
fabrication, installation, and commissioning of Critical Safety Systems 
and Equipment through verifications and certifications. The CVA 
nomination now occurs within BSEE's oversight, therefore, the CVA 
nomination has been decoupled from the COP. BSEE has taken a 
performance-based approach and declined to incorporate new industry 
standards in the regulations at this point in time as standards are 
changing and still being developed, especially U.S.-specific standards. 
The process implemented here provides flexibility regarding standard 
selection but also provides BSEE the opportunity to review the 
standards chosen by the lessee and CVA during the FDR review process.
    Comment: Several commenters suggested changes that would enable the 
Department to approve separate FDRs and FIRs for major project 
components. The commenters stated that these changes would encourage 
developers to seek CVA review throughout their project design process 
and would permit the use of specialized CVAs to verify specific project 
components.
    Response: BSEE already allows and encourages separated FDR/FIR 
submittals of integrated asset packages to allow for flexibility 
pursuant to Sec.  285.700(b). BSEE has made rule changes related to the 
role and responsibilities of the CVA for the purpose of advancing 
overall levels of safety in Sec. Sec.  285.707 and 285.708. If multiple 
CVAs are used on a facility, BSEE will still require one CVA to oversee 
the entire facility design, fabrication, and installation and ensure 
the compatibility of each facility component. All CVAs must meet BSEE 
requirements for qualifications and experience during the nomination 
process and BSEE will ensure the CVA scope of work addresses safety 
concerns throughout the commissioning of the facility.
    (b) Clarification of Rule Terminology.
    Comment: A commenter requested that the Department clarify the 
phrase ``all incidents'' that affect the design, fabrication, and 
installation of the project and its components that the CVA is required 
to report in Sec.  285.705. The commenter further requested that the 
proposed rule change the burden of reporting incidents from the CVA to 
the lessee, who has site control, and allow a CVA to verify any 
modifications needed to address the incident. Another commenter 
suggested that the Department change the definition for professional 
engineers that are allowed to replace CVAs to ``licensed professional 
engineer'' rather than ``registered,'' as it is the more common form in 
the United States. A commenter suggested that the Department explicitly 
define ``installation'' and ``commissioning'' in a similar manner to 
the definition of ``fabrication'' and explain in more detail what is 
included in the Critical Safety Systems and Equipment to better define 
what is required to be verified by a CVA.
    Response: The regulations at Sec.  285.705(a)(3) require the lessee 
to use CVA(s) to immediately notify BSEE of incidents that affect the 
design, fabrication, and installation of the project and its 
components. The lessee is also responsible for reporting certain 
incidents as required in Sec. Sec.  285.815 and 285.831, and the lessee 
is responsible for accepting any fabrication or installation 
modifications and notifying BSEE as provided in Sec.  285.703.
    BSEE ensures that the lessee upholds its reporting requirements 
(including the requirement to use a CVA to report certain incidents) 
and can take enforcement action if the lessee fails to meet these 
requirements. The use of the CVA for reporting incidents as a part of 
their oversight responsibilities enables their participation in 
evaluating such incidents and providing an independent analysis to BSEE 
and is thus preferable to having the lessee solely report incidents.
    ``Incidents that affect the design, fabrication, and installation 
of the project and its components'' is an intentionally broad phrase 
that includes but is not limited to design changes or events that occur 
prior to the final project verification report (PVR) that affect the 
design, fabrication, or installation of the project or its components 
such that the original design envelope, standards, or functionality has 
been changed from what was originally reviewed. BSEE notes the rest of 
the comments and may take them into consideration in the event that 
BSEE initiates a relevant rulemaking process in the future.
    (c) Scope and Role of CVAs and Project Engineers.
    Comment: Several commenters provided feedback on the proposed 
revisions to the role of a CVA in Sec.  285.705. Some commenters asked 
that the Department specify the qualifications required of a ``project 
engineer'' that is allowed to stand in for a CVA as it would assist 
developers in determining if a waiver could be pursued.

[[Page 42618]]

    Other commenters suggested adding language to indicate that the CVA 
scope of work must be in accordance with project certification schemes 
generally accepted and used in industry, such as International 
Electrical Code Renewable Energy (IECRE) OD-502. A commenter also 
requested that the Department clarify the responsibility of a General 
Project CVA to avoid conflicts and misunderstandings that may result in 
the incorrect completion or non-performance of verification tasks. 
Another commenter suggested that the Department adopt an independent 
process to review and approve a company's credentials for CVA 
nomination rather than project-specific approach proposed by the 
Department, to decouple CVA nomination from the project approval 
processes and encourage new participants in the CVA market.
    Response: A CVA must be both competent and independent. A proposed 
waiver and substitution of project engineers for CVAs will be evaluated 
by BSEE on a case-by-case basis. The lessee must submit the project 
engineer's qualifications to BSEE as a part of their waiver request to 
demonstrate that the project engineer is a professional engineer with 
relevant experience and expertise in the facilities they will be 
verifying/certifying. The waiver must demonstrate that the project 
engineer is qualified to perform the requirements of Sec. Sec.  285.708 
through 285.713. BSEE may evaluate this waiver requirement in future 
rulemakings. BSEE disagrees with the commenters' suggestion to 
incorporate any specific project certification standard, such as IECRE 
OD-502. BSEE has taken a performance-based approach and declined to 
incorporate new industry standards in the regulations at this point in 
time as standards are changing and still being developed, especially 
U.S.-specific standards. The process implemented here provides 
flexibility while still allowing BSEE to evaluate the CVA scope of work 
to ensure that it fully describes the CVA's verification and 
certification approach.
    When multiple CVA's are nominated for a project, a general project 
CVA must be nominated to manage the overall project verification and 
certification approach to ensure consistency and oversight among the 
other CVAs, especially in transition areas between different CVAs.
    BSEE disagrees with the commenters' suggestion to adopt an 
independent process to review and approve a company's credentials for 
CVA nomination because BSEE reviews each CVA nomination to make sure 
that the nominated CVA has the technical expertise, experience, and 
capacity for the specific project. A specific company may be an 
acceptable CVA for one project and not another depending on the 
technologies involved in the project, technical expertise of the 
company, number of projects the company is overseeing, and several 
other factors. BSEE will continue to review the CVA nomination for each 
specific project.
    (d) Monitoring and Witnessing of Project Stages by CVA.
    Comment: A commenter provided specific regulatory text revisions 
for Sec. Sec.  285.708 and 285.710 regarding when a CVA is needed on a 
project and how to nominate a CVA for the Department's approval, 
including a suggestion that CVAs may periodically monitor fabrication 
and installation of a facility and utilize type-approved procedures 
rather than ``proper'' procedures to verify a design.
    A commenter requested additional guidance on how a CVA may verify 
safety and suggested that a ``design-basis'' approach as described in 
BOEM's 2020 COP Guidelines Attachment C could be applied.
    A commenter stated that the ``Background'' section of the proposed 
rule should be revised to reflect the current expectations for third-
party witnessing of certain commissioning activities, as recently 
issued in a COP Approval Letter Terms and Conditions.
    Another commenter stated that attending and witnessing of 
commissioning activities of safety and protection functions by the CVA 
is not necessary as these functions are already type-certified as part 
of the IECRE-OD501 process. The commenter instead provided several 
regulatory text revisions to Sec.  285.710 to recommend that 
verification by a CVA be limited to a review of completeness of 
commissioning records and systems and remove the requirement of a 
review for type-certified components.
    Response: As to the first comment described above, BSEE agrees that 
the procedures used and validated during the type-approval process 
should be used for type-approved components. For other components, OEM 
procedures should be used when applicable as per Sec.  285.710. The 
specific regulatory text recommendations were not all incorporated; 
however, those recommendations were used to update the final regulatory 
text.
    In response to the second comment described above, BSEE is not 
employing a ``design basis'' for the FDR and FIR. The CVA must certify 
and/or verify the contents of the FDR and the FIR. The FDR contains 
specific engineering and design information, including Critical Safety 
Systems and Equipment. The FIR contains specific fabrication and 
installation information. Project ``design bases'' tend to be broad and 
less specific, and therefore not meet the criteria for an FDR or FIR. 
CVA verification must address specific hazards identified via a risk 
assessment and what mitigations (or design changes) were implemented to 
minimize or alleviate the hazards.
    As to the third comment described above, BSEE did not make changes 
based on the comment, but BSEE did meet the intent of the comment in 
the proposed and final rule by including requirements for commissioning 
activities that are similar to those in the COP terms and conditions in 
Sec. Sec.  285.705, 285.708, and 285.710. BSEE will also work with the 
CVA to make sure expectations for commissioning are clear.
    Finally, as to the fourth comment described above, BSEE disagrees 
that there is no need for witnessing of the commissioning of Critical 
Safety Systems and Equipment and has not implemented the proposed 
revisions to Sec.  285.710. One of the roles of the CVA, as described 
in Sec.  285.710, is to certify that engineering procedures are 
executed as designed. BSEE has determined that periodic witnessing of 
commissioning operations (inclusive of Critical Safety Systems and 
Equipment commissioning) in addition to reviewing completeness records 
is necessary to ensure conformance with submitted plans and that all 
Critical Safety Systems and Equipment are functioning as intended and 
installation is completed as designed.
    Comment: Multiple commenters requested that the Department further 
clarify the role of the CVA in verifying a facility's safety by 
incorporating appropriate consideration for human and occupational 
safety through verification of adherence to industry codes and 
standards to reduce confusion regarding CVA review of a facility.
    Response: BSEE has declined to incorporate new standards into these 
regulations because BSEE has determined that the proposed processes 
adequately account for human health and occupational safety. Human and 
occupational safety must be considered during the risk assessments that 
identify the Critical Safety Systems and Equipment as is required by 
Sec.  285.701. The CVA will review the risk assessments and the 
standards proposed as a part of the FDR and FIR for adequacy, will 
certify adherence to the standards, and will certify that the risk

[[Page 42619]]

assessment outcomes have been integrated into the project design. BSEE 
will review the risk assessment, FDR, FIR, and CVA submissions to 
ensure that appropriate standards are being utilized.
    Comment: A commenter stated that the removal of mooring and 
anchoring systems from CVA verification presents an increase to risk 
and safety of a project and requests that the Department reinstate the 
requirement. The commenter also discussed the need for a CVA to verify 
any self-inspection plans submitted for facilities in development.
    Response: Mooring and anchoring systems have not been removed from 
the CVA verification process. For floating facilities, the CVA or 
project engineer must verify their structural integrity, stability, 
ballast, and that proper procedures were used during, inter alia, 
installation of the mooring and tethering systems described at Sec.  
285.710(d)(3). For fixed bottom foundations for non-FOWTs, a CVA or 
project engineer is required to inspect and verify mooring, tendon, and 
tethering systems under Sec.  285.710(b)(6).
    BSEE will be evaluating self-inspection plans throughout the life 
of the project. The self-inspection plan includes an evaluation of the 
Critical Safety Systems and Equipment identified and the associated 
inspection criteria as well as the self-inspection criteria related to 
structural, mooring, and monitoring of corrosion protection. Due to the 
performance monitoring that BSEE will be conducting throughout the life 
of the project, BSEE is best suited to perform this work as opposed to 
a CVA.
    (e) Other Comments.
    Comment: A commenter suggested that the Department formalize the 
Project Verification Report using a consistent term, ``PVR.'' The 
commenter requested that the Department clarify whether some or all 
Critical Safety Systems and Equipment are referenced in existing 30 CFR 
585.710 and clarify that the periodic inspection referenced in proposed 
30 CFR 585.710(a) is applicable to the entire scope described by 
paragraph (b).
    Response: The term ``PVR'' is defined as an abbreviation for 
Project Verification Report in this preamble. BSEE has formalized the 
minimum requirements of a Project Verification Report in Sec.  285.708. 
BSEE understands that technologies will undergo frequent changes in a 
new industry; accordingly, BSEE declines to provide a list of Critical 
Safety Systems and Equipment which could limit future innovation. The 
regulation requires that the lessee do a risk assessment of their 
specific facilities and identify the Critical Safety Systems and 
Equipment, with oversight from the CVA. The CVA's periodic inspections, 
as referenced in 30 CFR 285.710(a), are applicable to the entire scope 
of the CVA's oversight in 30 CFR 285.710(b), which includes Critical 
Safety Systems and Equipment.
    Comment: A commenter suggested that the proposed text does not 
clearly state who will prepare the PVR at Sec.  585.704.
    Response: BSEE agrees with the comment and has amended the 
equivalent provisions in Sec.  285.708(a)(5) to designate a CVA to 
prepare the PVR. BSEE realizes there may be multiple PVRs for a project 
and has formalized the minimum requirements of a PVR in Sec.  
285.708(a)(5).
    Comment: A commenter stated that the ``Background'' section in the 
NPRM (Section IV.B.6, 88 FR 5974) states that ``[t]he CVA must also use 
good engineering judgment and practice in conducting independent 
assessments of the commissioning of critical safety systems.'' However, 
the commenter stated that this language is not included in existing 30 
CFR part 585 (2011), although it can be found in recently issued COP 
Approval Letter Terms and Conditions. The commenter urged the 
Department to clarify ``witnessing'' requirements to be performed by 
the CVA, as proposed in 30 CFR 585.705(b)(2). They suggested that the 
Department revise the ``Background'' section of the rule preamble to 
reflect the current expectations for 3rd-party witnessing of certain 
commissioning activities.
    Response: BSEE has revised Sec.  285.708 to clarify that the CVA's 
primary duties for fabrication and installation are to: (1) use good 
engineering judgment and practice in conducting an independent 
assessment of the fabrication and installation activities and of the 
commissioning of Critical Safety Systems and Equipment; (2) monitor the 
fabrication and installation of the facility and the commissioning of 
Critical Safety Systems and Equipment; (3) assess the facility design 
to withstand the environmental and functional load conditions 
appropriate for the intended service life at the proposed location; and 
(4) certify in Project Verification Reports that project components are 
fabricated and installed in accordance with accepted engineering 
practices and to a nationally or internationally recognized quality 
assurance standard or to an equivalent alternate means of quality 
assurance considered on a case-by-case basis.
    The regulatory text at Sec.  285.710(a) provides that ``the CVA or 
project engineer must make periodic onsite inspections while 
installation is in progress and must, as appropriate, verify, witness, 
survey, or check the installation items required by this section.'' 
BSEE added another witnessing expectation for the CVA or project 
engineer to make periodic onsite inspections to witness the 
commissioning of Critical Safety Systems and Equipment at Sec.  
285.710(f). Specific witnessing expectations may be included and 
approved by BSEE as part of the CVA scope of work.
    Comment: A commenter asked that the Department clarify the CVA's 
duties for facility design review at Sec.  585.708 to include within 
the usage of ``good engineering judgment and practices'' specific 
language that the facility ``will withstand the environmental and 
functional load conditions appropriate for the intended service life at 
the proposed location and has been designed to provide for safety.''
    Response: BSEE agrees with this comment in theory, but Sec.  
285.708 contains requirements for fabrication and installation review. 
BSEE has included language in Sec.  285.707(a) to require the CVA to 
verify a facility is designed to withstand the environmental and 
functional load conditions appropriate for the intended service life at 
the proposed location and has been designed to minimize risk to 
personnel as required by Sec.  285.105(a).
    Comment: A commenter proposed to add a new section entitled ``What 
must I include in my as-built submissions?'' with content as follows: 
``(a) Your as-fabricated drawings and documents of any facilities that 
are outlined in your FDR and FIR, must be made available to DOI prior 
to PVR non-objection and must include the following items:
    Required documents: (1) Complete set of cable drawing(s), Required 
documents: (2) Electrical one-line drawing(s).''
    Response: BSEE is considering publishing guidance regarding as-
built drawings and professional engineer stamping expectations but has 
not made changes in this final rule as a result of these comments.
    BSEE notes the rest of the comments and may take them into 
consideration in the event that BSEE initiates a relevant rulemaking 
process in the future.
3. What is the Department finalizing?
    (a) Sec.  285.700 What reports must I submit to BSEE before 
installing facilities described in my approved SAP, COP, or GAP?
    The Department is finalizing the language in Sec.  285.700, as was 
proposed Sec.  585.700, with clarifying revisions. In

[[Page 42620]]

final Sec.  285.700(a), BSEE requires that lessees submit an FDR and an 
FIR before installing facilities described in the approved COP (Sec.  
[thinsp]585.632(a)) and, when required by your SAP (Sec.  
[thinsp]585.614(b)), or GAP (Sec.  [thinsp]585.651). You may submit 
your FDRs and FIRs to BSEE pursuant to revisions made to Sec. Sec.  
285.700, 285.701, and 285.702 before or after SAP, COP, or GAP 
approval.
    As provided in final Sec.  285.700(b), if you submit separate FDRs 
and FIRs by asset package (e.g., wind turbine generator (WTG), offshore 
substation/electrical service platform, etc.), you must ensure major 
integrated asset package(s) are complete (e.g., the WTG package 
includes the rotor-nacelle assembly (RNA), blades, tower, foundation, 
and transition piece, if applicable), and explain to BSEE how all asset 
packages will function together effectively in an integrated manner in 
accordance with your project design. You must also demonstrate that 
such integration has been verified by your CVA.
    Subject to these requirements, you may proceed with fabrication and 
installation, under Sec.  285.700(d), when (1) BSEE deems your report 
submitted before SAP, COP, or GAP approval and notifies you of its non-
objection to the FDR and FIR, or does not respond within 60 business 
days of SAP, COP, or GAP approval; or (2) BSEE deems your report 
submitted after SAP, COP, or GAP approval and notifies you of its non-
objection to the FDR and FIR or does not respond with objections within 
60 business days of the report being deemed submitted.
    The existing requirement to submit site-specific geotechnical data 
at the COP stage under 30 CFR 585.626(a) is being modified by both 
agencies. BSEE and BOEM are relocating review of this site-specific 
data from 30 CFR 585.626(a) to 30 CFR 285.701(a). Within this 
provision, BSEE is clarifying that the 60-day FDR and FIR review period 
in the existing regulation is 60 business days. BSEE determined that a 
60-business day review period, rather than the proposed 60-calendar day 
review period, is necessary to ensure that BSEE has sufficient time to 
review these complicated and lengthy technical documents.
    Section 285.700(e) has also been revised to state that you may 
commence procurement of discrete parts of the project that are 
commercially available in standardized form and type-certified 
components, or fabrication activities that do not take place on the OCS 
(e.g., manufacturing), prior to the submittal of the FDR or FIR under 
Sec.  285.700(a) or any plans required under 30 CFR parts 585 and 586. 
The procurement and fabrication of facility components are subject to 
verification and certification by your CVA, and BSEE may object to 
their installation if the components or their fabrication are 
inconsistent with accepted industry or engineering standards, the 
approved SAP, COP, or GAP, the FDR or FIR, or BSEE's regulations.
    Under final Sec.  285.700(f), if BSEE requires additional 
information or has objections, we will notify you in writing within 60 
business days of the FDR or FIR being deemed submitted for FDRs and 
FIRs submitted after plan approval, or within 60 business days of plan 
approval for FDRs and FIRs submitted before plan approval. Following 
initial notification of any objections, BSEE may follow up with a 
letter or email detailing its objections to the report and requesting 
that certain actions be undertaken. Final paragraph (f) in this section 
also states that you cannot commence fabrication or installation 
activities on the OCS until you resolve all objections in such reports 
to BSEE's satisfaction.
    (b) Sec.  285.701 What must I include in my Facility Design Report?
    The Department is finalizing the language in proposed Sec.  
585.701, including revisions to Sec.  285.701(a)(1) through (10), the 
addition of paragraphs (a)(11) through (13) and removal of paragraph 
(e). In this section, BSEE addresses how the design report demonstrates 
that the design conforms to key responsibilities listed in Sec.  
285.105(a). In paragraph (a) of this section, the required documents in 
the report include a cover letter; location plat; front, side, and plan 
view drawings; structural drawings; summary of environmental data used 
for design; summary of engineering design data; design calculations; 
project-specific studies used in the facility design or installation; 
description of the loads imposed on the facility; geotechnical reports; 
design standards; Critical Safety Systems and Equipment; and other 
information required by BSEE. BSEE is not finalizing proposed changes 
to paragraph (b) and is keeping the provision in the existing 
regulation with the exception of adding ``tendon'' to paragraph (b)(2). 
BSEE is revising paragraph (c) to include what was proposed in 
paragraph (b) that requires submission of the FDR to BSEE according to 
Sec.  285.110. Under paragraph (d) of this section, if you are required 
to use a CVA, the design report must include a certification statement 
with accompanying justification attesting that the design of the 
structure has been certified by a BSEE-approved CVA to be in accordance 
with accepted engineering practices and the approved SAP, GAP, or COP, 
as applicable, and has been designed to provide for safety. The 
certification statement should also identify a location where the 
certified design and as-built plans and specifications will be on file. 
The Department proposed in the January 30, 2023, NPRM to change the 
regulatory language defining the CVA's role from ``certify'' and 
``certification'' to ``verify'' and ``verification'' in Sec.  
285.701(d). The Department ultimately decided to maintain the use of 
``certify'' and ``certification'' in this regulation. BSEE evaluated 
each use of the words ``certify,'' ``certification,'' ``verify,'' and 
``verification'' and updated the regulations as appropriate. In this 
case, ``certify'' and ``certification'' are appropriate because the 
terms describe how the CVA ``recognizes that (someone or something) 
possesses certain qualifications or meets certain standards.'' The CVA 
must, for example, ``certify'' that a design or safety component 
conforms to a defined certification protocol based on criteria from 
specific quality assurance standards or recognized accepted engineering 
practices.
    (c) Sec.  285.702 What must I include in my Fabrication and 
Installation Report?
    The Department is finalizing this regulation, consistent with 
proposed Sec.  585.702. BSEE is revising Sec.  285.702(a)(1) through 
(7); removing the existing paragraph (d); redesignating existing 
paragraphs (b) and (c) as paragraphs (c) and (d), respectively; adding 
paragraphs (a)(8) through (10) and (b); and revising the newly 
redesignated paragraph (d). BSEE added new documents that must be 
included in the fabrication and installation report, including quality 
assurance information, which includes certificates ensuring adherence 
to nationally or internationally recognized assurance standards; 
commissioning procedures for Critical Safety Systems and Equipment, 
including OEM procedures or other BSEE accepted engineering practices 
for commissioning of Critical Safety Systems and Equipment as 
identified in Sec.  285.701(a)(12); project easement; and other 
information. A similar attestation to Sec.  285.701 must accompany the 
filing of fabrication and installation reports. For purposes of quality 
assurance, BSEE requires that certificates ensuring adherence to 
nationally or internationally recognized standards be included in the 
FIR, pursuant to Sec.  285.702(a)(6). Additionally, the NPRM proposed 
to change the regulatory language defining the CVA's role from 
``certify'' and

[[Page 42621]]

``certification'' to ``verify'' and ``verification'' in Sec.  
285.702(d). The Department ultimately decided to maintain the use of 
``certify'' and ``certification'' in this regulation. In this case, the 
terms ``certify'' or ``certification'' are appropriate because they 
describe how the CVA ``recognizes that (someone or something) possesses 
certain qualifications or meets certain standards.'' BSEE may require a 
CVA to ``certify'' that a design or safety component conforms to a 
defined certification protocol based on criteria from specific quality 
assurance standards or recognized accepted engineering practices. The 
terms ``verify'' or ``verification'' describes how the CVA demonstrates 
that something is true, accurate, or justified. BSEE has evaluated each 
of the CVAs actions, as required by the regulations, and updated the 
regulations to use the appropriate term.
    (d) Sec.  285.703 What reports must I submit for project 
modifications and repairs?
    The Department is finalizing paragraphs (a) and (c) of Sec.  
285.703, consistent with proposed Sec.  585.703. With respect to 
repairs and modifications, BSEE revised the term ``major repair'' to 
provide for substantial repair of a Critical Safety Systems or 
Equipment, including those identified in your FDR. The term ``major 
modification'' is revised to contain similar language of ``substantial 
alteration'' of Critical Safety Systems and Equipment, including those 
identified in your FDR. A similar attestation to Sec.  285.701 must 
accompany the filing of repair and modification reports. CVAs will also 
be required to ``certify'' that major repairs or modifications of 
renewable energy structures and crucial components to a completed 
project conform to accepted engineering practices, in the FDR and the 
BOEM-approved plan, as applicable.
    (e) Sec.  285.704 After receiving the FDR, FIR, or project 
verification reports, what will BSEE do?
    The Department is finalizing this regulation, consistent with 
proposed Sec.  585.704, with revisions to Sec.  285.704(a), (b), and 
(c). In this final rule, BSEE-administered rules for determining if 
reports are ``deemed submitted'' or in need of correction for 
``problems and deficiencies'' track similar BOEM-administered rules. 
BSEE will have 20 business days to deem a report submitted or to notify 
a lessee of problems or deficiencies that prevent BSEE from determining 
that the reports are ``deemed submitted'' such as the submission being 
incomplete or files being unopenable or corrupted.
    (f) Sec.  285.705 When must I use a Certified Verification Agent 
(CVA)?
    The Department is finalizing paragraphs (a) through (d) of Sec.  
285.705, consistent with proposed Sec.  585.705, with minor revisions. 
This regulation has been updated to allow for multiple CVAs, if 
approved by BSEE. The roles of the CVAs have been updated to add that 
the CVAs must (1) ensure that the design of the facilities is suitable 
for the location where they will be installed, (2) ensure Critical 
Safety Systems and Equipment are commissioned in accordance with the 
procedures identified in Sec.  285.702(a)(8), and (3) provide BSEE and 
the lessee with reports of all incidents that affect the facility 
design, fabrication, and installation, including the commissioning of 
Critical Safety Systems and Equipment, for the project and its 
components.
    Waivers from CVA requirements must include a demonstration that the 
facility design conforms to a standard design that has been used 
successfully in a similar environment, the relevant fabricator has 
successfully fabricated similar facilities, the installation company 
has successfully installed similar facilities in a similar offshore 
environment, and the facility will be fabricated or that major 
modification or major repairs were completed in conformance with 
accepted engineering practices and to a nationally or internationally 
recognized quality assurance standard.
    Finally, if BSEE waives the requirement for a CVA, lessees must 
demonstrate that their project engineer can perform the same duties and 
responsibilities as the CVA. The lessee must submit the project 
engineer's qualifications to BSEE as part of their waiver request to 
demonstrate that the project engineer is a professional engineer with 
relevant experience and expertise in the facilities they will be 
verifying/certifying.
    (g) Sec.  285.706 How do I nominate a CVA for BSEE approval?
    The Department is finalizing Sec.  285.706(b)(2) and (7), (c), and 
(d), consistent with proposed Sec.  585.706. BSEE is removing Sec.  
285.706(e) because the Reorganization Rule transferred authority for 
approving a CVA from BOEM to BSEE. The final rule modifies proposed 
paragraph (a) of this section to require that a CVA must be nominated 
by the lessee and approved by BSEE before conducting any verification 
activities for which they have been nominated. Under this revised 
provision, if you intend to use multiple CVAs, you must nominate a 
general project CVA who will manage the overall project verification 
and certification approach and who will ensure consistency and 
oversight among multiple CVAs. The general project CVA must be 
nominated no later than the COP submission date. Paragraph (c) of this 
section also includes conflict of interest provisions to ensure chosen 
CVA(s) were not directly involved in the design, fabrication, 
installation, modification, or repair for which they are asked to 
provide an independent oversight.
    Section 285.706 also requires that all verifications and 
certifications must be conducted under the direct supervision of a 
registered professional engineer.
    (h) Sec.  285.707 What are the CVA's primary duties for facility 
design review?
    The Department is finalizing Sec.  285.707(a) and (b) consistent 
with proposed Sec.  585.707 (a) and (b), with a few minor revisions. 
BSEE has made minor changes to the description of CVA duties in final 
Sec.  285.707(a) to require CVAs to verify to BSEE that the facility is 
designed not only to withstand the environmental and functional load 
conditions appropriate for the intended service life at the proposed 
location, but also to minimize safety risk to personnel as required in 
Sec.  285.105(a). Also, the regulation at paragraph (b)(9) is added to 
provide that the CVA must conduct an assessment supporting the design 
for human safety and how the results were used in the design. The 
Department is not finalizing the proposed Sec.  285.707(c).
    (i) Sec.  285.708 What are the CVA's or project engineer's primary 
duties for fabrication and installation review?
    The Department is finalizing Sec.  285.708, consistent with 
proposed Sec.  585.708, with minor revisions. BSEE has updated 
expectations for the CVA's oversight of fabrication and installation to 
add in paragraph (a) that the CVA must 1) use good engineering 
judgement and practice in conducting an independent assessment of the 
fabrication and installation activities and of the commissioning of 
Critical Safety Systems and Equipment, and 2) monitor the fabrication 
and installation of the facility and the commissioning of Critical 
Safety Systems and Equipment. Under paragraph (a)(5) in this section, 
the CVA must certify in a project verification report that project 
components are fabricated and installed in accordance with accepted 
engineering practices and to a nationally or internationally recognized 
quality assurance standard (or to an equivalent alternate means of 
quality assurance considered on a case-by-case basis), the lessee's 
BOEM-approved SAP, COP, or

[[Page 42622]]

GAP (as applicable), and the lessee's FIR. As provided in paragraph 
(a)(5), the project verification report must also identify the location 
of all records pertaining to facility fabrication and installation. In 
paragraph (a)(6), the CVA must provide records documenting that 
Critical Safety Systems and Equipment are commissioned in accordance 
with the procedures identified in Sec.  [thinsp]285.702(a)(8); and, 
under paragraph (a)(7), identify the location of all records pertaining 
to commissioning of Critical Safety Systems and Equipment, as required 
in Sec.  [thinsp]285.714(c).
    Under paragraph (b), the CVA or project engineer must now also 
monitor the fabrication and installation of the facility and the 
commissioning of Critical Safety Systems and Equipment to certify that 
they have been built and installed in accordance with the lessee's 
FDR(s) and FIR(s). According to final paragraph (b)(1), the CVA or 
project engineer must inform the lessee and BSEE if the fabrication and 
installation procedures or Critical Safety Systems and Equipment 
commissioning procedures have changed or design specifications have 
been modified and, under paragraph (b)(2), if the lessee accepts the 
modifications, the lessee must also inform BSEE.
    (j) Sec.  285.709 When conducting onsite fabrication inspections, 
what must the CVA or project engineer verify?
    The Department is finalizing Sec.  285.709(a), consistent with 
proposed Sec.  585.709 with minor edits. BSEE is not finalizing 
paragraph (b) as proposed and is keeping the provision in the existing 
regulation.
    (k) Sec.  285.710 When conducting onsite installation inspections, 
what must the CVA or project engineer do?
    The Department is finalizing Sec.  285.710, consistent with 
proposed Sec.  585.710. For inspections of installation activity on 
floating facilities, BSEE is adding commissioning of Critical Safety 
Systems and Equipment to the scope of work performed by a CVA or 
project engineer in Sec.  285.710(b)(9). Content of their work will 
include onsite inspections to verify, witness, survey, or check the 
installation and commissioning of Critical Safety Systems and Equipment 
to verify the equipment functions as designed and that all records 
associated with commissioning of Critical Safety Systems and Equipment 
are complete. The final rule expands the scope of CVA or project 
engineer activity to verify that proper procedures are used for 
commissioning of Critical Safety Systems and Equipment for both fixed 
and floating facilities at Sec.  285.710(c). For floating facilities, 
the CVA or project engineer must verify their structural integrity, 
stability, ballast, and that proper procedures were used during (1) 
loadout of the facility, (2) installation of foundation pilings, 
templates, and anchoring systems, and (3) installation of the mooring, 
tendon, and tethering systems as required by final Sec.  285.710(d). 
The CVA or project engineer must also conduct an onsite inspection of 
the installed facility as approved, as provided in final Sec.  
285.710(e) and witness the commissioning of Critical Safety Systems and 
Equipment, as provided in final Sec.  285.710(f).
    (l) Sec.  285.712 What are the CVA's or project engineer's 
reporting requirements?
    The Department is finalizing Sec.  285.712, consistent with 
proposed Sec.  585.712, with one edit. With this final rule, reports 
prepared by a CVA or project engineer will summarize issues involving 
the designs, and any incidents during facility fabrication and 
installation or Critical Safety Systems and Equipment commissioning, 
and how those issues were resolved, pursuant to Sec.  285.712(b)(5).
    (m) Sec.  285.713 [RESERVED]
    BSEE is removing and reserving this section, consistent with the 
NPRM.
    (n) Sec.  285.714(a)(4) What records relating to FDRs, FIRs, and 
Project Modification and Repair Reports must I keep?
    The Department is finalizing Sec.  285.714, consistent with 
proposed Sec.  585.714. Additional recordkeeping measures are required 
for the commissioning of Critical Safety Systems and Equipment and the 
location of records identified in the certification statement, as set 
out in Sec. Sec.  [thinsp]285.701(c), 285.703(b), and 285.708(a)(5) and 
(a)(7). These additional recordkeeping measures include providing BSEE 
with the location of these records in the certification statements 
associated with these regulations.

E. Renewable Energy Leasing Schedule

1. What did the Department propose?
    (a) Sec.  585.150 What is the renewable energy leasing schedule?
    BOEM proposed to include a new Sec.  585.150 describing the 
renewable energy leasing schedule. This proposed schedule would include 
a list of locations under consideration for leasing and a leasing 
schedule that BOEM intends to follow in announcing its future renewable 
energy lease sales. According to the proposal, at least once every two 
years, the Secretary would publish a schedule of proposed lease sales. 
As a proposed schedule, it would not obligate BOEM to offer all sales 
on the schedule; BOEM would adjust the schedule as necessary through 
the scheduled updates. The first published schedule would be issued for 
the five-year period following the effective date of this rulemaking, 
and subsequent schedules will cover the five-year period after each 
update. This schedule would include a general description of the area 
of each proposed lease sale, the calendar year in which each lease sale 
is projected to occur, and the reasons for any changes made to the 
previous schedule. Every time the schedule is updated, BOEM would 
identify those lease sales that are being considered for the following 
5-year period. For more details on the proposed renewable energy 
leasing scheduled, see 88 FR 5984.
    BOEM specifically solicited comment on ``its proposal to publish a 
proposed Renewable Energy Leasing Schedule and what information should 
be provided as part of this schedule.'' It also specifically solicited 
comments ``on the content and the timing of the schedule updates, as 
well as generally on how best to provide a schedule to improve 
transparency of renewable energy development on the OCS.''
2. What are the key public comments?
    Comment: Some commenters expressed opposition to BOEM's proposed 
renewable energy leasing schedule. A commenter said that based on their 
experience with the oil and gas 5-year program, the 5-year leasing 
schedule would not be transparent, in the public interest, or 
protective of the marine ecosystem and public health. The commenter 
said the schedule would undermine due process and meaningful public 
involvement. A commenter stated that a schedule by rulemaking would 
give BOEM the authority to further curtail public engagement and 
stakeholder input and avoid waiting for studies that could impact 
decisions. The commenter recommended that BOEM establish the schedules 
outside of the rulemaking process.
    Response: The OSW leasing schedule in this rule should not be 
confused with BOEM's National Outer Continental Shelf Oil and Gas 
Leasing Program, which is different in many ways. BOEM does not agree 
that including in our discretionary decision-making process a 
requirement for greater public transparency about the agency's leasing 
intentions could undermine due process or meaningful public 
involvement, as the commenter asserts. The regular dissemination of a 
schedule indicating

[[Page 42623]]

areas where the agency intends to focus future area identification 
efforts will not affect the actual process that BOEM employs to 
evaluate potentially suitable areas for leasing.
    While we commit in this rulemaking to periodically publishing an 
OSW leasing schedule, that aspirational schedule is independent from 
BOEM's area identification and leasing process. The schedule will 
simply summarize the agency's future plans for the consideration of 
areas for leasing. For leasing scheduled in the first year or two of 
the five-year period, BOEM may have completed some of the milestones 
toward leasing development (area identification, sale notices, etc.). 
For leasing scheduled later in the five-year period, BOEM may not have 
completed or even begun such steps.
    Comment: A commenter expressed support for additional requirements 
associated with stakeholder engagement and government coordination. A 
couple of commenters said BOEM should consider allowing public input 
when changes are made to the schedule. A commenter expressed concern 
that the proposed rule would not include a requirement for public 
engagement or comment periods on the leasing schedule, stating that 
public engagement should be required. Similarly, a few commenters 
recommended that in creating a schedule, BOEM should lay out a 
comprehensive process for engagement that would also vet alternatives 
and promote the most appropriate areas for development of OSW.
    Response: BOEM has not included a requirement for a comment period 
prior to publishing the leasing schedule every two years. The leasing 
schedule is meant to shed light on the state of BOEM's current thinking 
rather than being the culmination of a detailed decision-making 
process. Note that areas identified in a leasing schedule will likely 
not see actual development for at least another 10-15 years, during 
which many comment periods, public meetings, consultations, government-
to-government consultations, meetings, publications, studies, plans and 
other activities must take place. The leasing plan sits at the 
beginning of this process and is intended merely to let the public know 
where BOEM plans to focus its attention on the consideration of new 
areas.
    Comment: One commenter requested additional information regarding 
how BOEM will integrate Tribal consultation with the development of the 
schedule before it is released to the public. Another commenter 
requested that Tribal consultation be triggered whenever there is a 
change to the lease schedule.
    Response: BOEM is committed to following the Department's policy on 
Consultation with Indian Tribes and Alaska Native Claims Settlement Act 
(ANCSA) Corporations and will consult with Tribes where there are 
departmental actions that may have a substantial direct effect on a 
Tribe(s) (512 DM4; 512 DM 6). BOEM declines to commit to public comment 
periods to inform the leasing schedules introduced in this rule.
    Comment: A commenter proposed revisions to the regulatory text at 
Sec.  585.150 to ``ensure that the leasing schedule is focused on 
relevant objectives, is realistically achievable, and fosters 
transparency for all stakeholders.'' A few commenters said the text 
should identify specific considerations to be reflected in the leasing 
schedule, including State and Federal renewable energy goals and 
mandates, renewable energy supply chain needs, comparative needs of 
regional and national energy markets, and the intersection of energy 
generation potential and commercial development interest.
    Response: The items mentioned in the comment will almost certainly 
be considered in creating the leasing schedule, however, BOEM is not 
committing in this rulemaking to publishing a discussion of how 
considerations were balanced to obtain the announced leasing schedule.
3. What is the Department finalizing?
    (a) Sec.  585.150 What is the renewable energy leasing schedule?
    The final rule creates a new subpart B comprised of Sec.  585.150 
that establishes a leasing schedule, essentially as proposed in the 
NPRM. The schedule is published at least every two years, which covers 
the five-year period following the schedule's publication. The schedule 
will describe a general description of the area covered by each 
proposed lease sale, the calendar year in which it is projected to 
occur, and reasons for any changes to the previously published 
schedule. BOEM did not add any mandatory comment periods or specific 
outreach to the leasing schedule requirement.

F. Lease Issuance Procedures

    BOEM proposed to revise several aspects of renewable energy auction 
regulations in the NPRM. These revisions would provide simplification, 
clarification, and conformance with existing agency practice.
1. What did the Department propose?
    (a) Sec.  585.106 What happens if I fail to comply with this part?
    BOEM proposed clarification to the process surrounding the 
imposition of civil penalties.
    (b) Sec.  585.210 What are the steps in BOEM's competitive lease 
award process?
    BOEM proposed to reorganize, simplify, and clarify the regulatory 
section Sec.  585.210 that detail the steps leading to an OCS renewable 
energy auction.
    (c) Sec.  585.213 What information is included in the PSN?
    BOEM proposed to simplify and clarify the auction regulations by 
replacing the currently enumerated auction formats, bid systems, and 
bid variables with a more flexible process to better accommodate an 
emerging industry while allowing for auctions to be customized based on 
circumstances surrounding each individual auction.
    Consistent with BOEM's existing practice, the proposed sale notice 
(PSN) would propose the specific format and procedures for an upcoming 
auction, and the public would have an opportunity to submit comments 
that would inform BOEM's final decisions regarding format and 
procedures.
    (d) Sec.  585.214 What information is included in the FSN?
    BOEM proposed to publish the final auction format and procedures in 
the final sale notice (FSN). This would allow BOEM greater flexibility 
to tailor each auction to fit the particular circumstances.
    (e) Sec.  585.216 How are bidding credits awarded and used?
    As discussed in the NPRM preamble at 88 FR 5985, BOEM proposed to 
continue to implement multiple factor auctions, through the use of 
bidding credits, to allow the competitive lease award process to take 
into consideration various priorities, such as advancing a domestic 
supply chain or requiring workforce development agreements, relating to 
orderly development of OCS renewable energy resources. The proposal 
clarified that a bidder may be eligible for bidding credits based on 
actions the bidder has already undertaken or for commitments to future 
actions. In addition, at 30 CFR 585.225(g), BOEM proposed that, in the 
event that a lessee does not meet the commitments it made to obtain any 
bidding credits, the lessee would be required to repay the value of the 
bidding credits that it received plus interest. BOEM would also reserve 
the right to impose civil penalties pursuant to the provisions of 
subpart N of 30 CFR

[[Page 42624]]

part 550 for failure to comply with the terms or provisions of a lease, 
easement, or right-of-way. According to the provisions of the proposed 
rule, a multiple factor auction could take one or more non-monetary 
factors into consideration, including: (1) power purchase agreements 
(PPAs); (2) eligibility for, or applicability of, renewable energy 
credits or subsidies; (3) development agreements by a potential lessee 
that would facilitate shared transmission solutions and grid 
interconnection; (4) technical merit, timeliness, financing and 
economics, environmental considerations, public benefits, or 
compatibility with State and local needs; (5) agreements or commitments 
by the developer that would facilitate OCS renewable energy development 
or other OCSLA goals; or (6) any other factor or criteria to further 
development of offshore renewable energy in a sustainable and 
environmentally sound manner, as identified by BOEM in the PSN and FSN. 
In the NPRM, BOEM solicited comments on the use of bidding credits and 
multiple factor auctions as a method of advancing important priorities, 
such as promoting workforce development or supply chain enhancement. 
BOEM was specifically ``interested in obtaining comments on how bidding 
credits or factors might be tailored to mitigate possible adverse, 
project-related impacts. For example, BOEM was interested in receiving 
comments on what impacts a project could have on underserved 
communities and how bidding credits or multiple factor auctions can be 
used to promote mechanisms such as community benefit agreements (CBA) 
that could address those impacts and provide benefits to the 
underserved communities. Comments on alternative means to achieve 
public policy goals, such as through lease stipulations, are also 
sought.''
    (f) Sec.  585.222 Improper or Inappropriate Bidder Communications.
    BOEM proposed to explicitly prohibit a bidder from disclosing its 
auction strategies and economic valuations of a lease area to other 
bidders in a particular auction in any manner that could prevent the 
United States from obtaining a fair return on a prospective lease. The 
proposal also outlined the rules applicable to all auctions and the 
processes BOEM would use to disqualify a bidder that no longer meets 
qualification requirements or who engages in specified improper 
conduct. Additionally, it specified how a disqualified bidder might 
seek to be re-qualified as a bidder.
    (g) Sec.  585.224 What will BOEM do after the auction?
    The proposal added a new term ``provisional winner'' to describe 
the bidder that BOEM determines has submitted the winning bid at the 
close of the auction, pending completion of the government's post-
auction reviews and the lease award reconsideration process. As 
proposed, the provisional winner would become the winning bidder upon 
favorable completion of these reviews and appeals. Additionally, as 
discussed in the NPRM preamble (88 FR 5985), BOEM proposed to 
consolidate the reconsideration and appeal provisions in Sec.  585.118 
into a single section while retaining separate processes for seeking 
the review of a decision, selecting a provisional winner, and for 
appealing all other final decisions.
    BOEM proposed to simplify and clarify post-auction procedures in 
Sec.  585.224 by outlining what BOEM and a provisional winner must do 
between the auction and lease execution. Additionally, the proposal 
eliminated the term ``request for interest'' and proposed to replace it 
with a broader term ``request for information'' (RFI). Finally, in 
Sec.  585.225, BOEM proposed to change the due date for payment of the 
first 12 months' rent to 45 calendar days after the winning bidder 
receives a copy of the executed lease from BOEM.
    (h) Sec.  585.225 What happens if BOEM accepts a bid?
    Because the proposed rule would allow a provisional winner to 
become a lessee before it has completed all obligations for which it 
obtained bidding credits, an additional provision was proposed at Sec.  
585.225(g), specifying that a lessee that has obtained bidding credits 
for prospective performance obligations that were not fulfilled at the 
time of the lease award, are subject to repayment in the event that 
those performance obligations are not ultimately met prior to a 
specified deadline or event.
    (i) Sec.  585.226 What happens if the provisional winner fails to 
meet its obligations?
    As discussed in the preamble of the proposed rule (88 FR 5987), 
BOEM proposed to define the term ``provisional winner'' and to outline 
consequences if a provisional winner fails to sign the lease agreement, 
provide the requisite amount of financial assurance, or tender the 
outstanding bid balance. It included a list of actions that BOEM would 
be authorized to take if a provisional winner fails to fulfill its 
obligations.
    (j) Sec.  585.438 What happens to leases or grants (or portions 
thereof) that have been relinquished, contracted, or cancelled?
    BOEM proposed language in the NPRM (88 FR 5996) that would provide 
clear authority for BOEM to offer a lease to the next highest bidder if 
a provisional winner of a lease auction fails to fulfill its 
obligations before lease execution or is otherwise unable to execute a 
lease. Similarly, BOEM proposed that if a lessee relinquishes its lease 
or BOEM contracts or cancels a lease in whole or in part, BOEM could 
re-offer the area previously covered by the lease.
2. What are the key public comments?
    (a) Pre- and Post-Auction Procedures.
    Comment: A commenter said that, in the area identification process, 
BOEM does not explicitly consider the energy potential of the areas or 
the current and future renewable energy goals of the proximate states. 
Therefore, the commenter suggested that BOEM add a factor to the list 
in Sec.  585.211(a) ``to indicate that the Call might include an 
indicative power (MW) capacity of the given area(s) . . . informed by 
Federal, State, and local clean energy goals, supply chain 
considerations, and commercial interest.'' Additionally, the commenter 
said the regulatory text should require the consideration of commercial 
viability and prevention of waste during the area identification 
process. The commenter provided revised regulatory text for Sec. Sec.  
585.211 and 585.212 to reflect these suggestions. The commenter further 
expressed support for:
     ``Simplification and clarity added to the lease process 
regulations that make them both more readable and easier to follow;
     Changes to Call and Area Identification procedures at 30 
CFR 515.211 and 585.212 that clarify factors BOEM considers in 
determining whether specific OCS areas are suitable for further 
consideration for renewable energy development, including the area's 
feasibility for development;
     Consideration as to whether an area is technically and 
economically viable for industry is critical to determining if an 
auction should move forward;
     Clarity provided related to the auction format that 
provides BOEM with the flexibility to adjust its format as industry 
evolves; and
     Clarity regarding post auction procedures at 30 CFR 
515.224.''
    To further transparency, a commenter recommended providing more 
information at the Call for Information and Nominations stage, 
including the target capacity or acreage that may be

[[Page 42625]]

offered, and preliminary information on the auction format.
    Response: BOEM does consider the goals and mandates of coastal 
states adjacent to areas under consideration for OSW leasing in the 
area identification process. For example, BOEM typically does not move 
forward with leasing offshore of states that actively oppose OSW 
development, and BOEM has offered multiple rounds of leasing in areas 
with strong regional interest in OSW, such as southern New England and 
the New York Bight. However, BOEM does not offer a specific leasing 
``target'' in the area identification process because doing so would 
require BOEM to pre-determine results and BOEM does not do that. BOEM 
feels it is important to consistently convey to the public that the 
decision-making process occurs through public outreach. Public outreach 
is more than simply a process that BOEM must go through to get to 
already-desired outcomes. It may be possible to establish a target--
informed by State objectives--in a way that makes clear that the 
decision has not already been made to find a given amount of acreage, 
whatever the consequences. However, the existence of such a target 
could lead to an impression that, once formed, could be difficult to 
rectify.
    Comment: A commenter recommended revising paragraph (b)(2) of Sec.  
[thinsp]585.211 to include ``archaeological and/or culturally 
significant sites on the seabed or nearshore, including viewsheds and 
traditional cultural landscapes and properties.'' The commenter said 
this paragraph should also ``provide that BOEM request additional 
socio-economic information such as potential impacts associated with 
housing, Tribal revenues, worker's camps traditional gathering, first 
foods, other disproportionate impacts felt by Tribal citizen members.''
    Response: Section 585.211(b)(2) pertains to resources on which BOEM 
requests comment in a Call for Information and Nominations, and states 
that BOEM may request comments on ``archaeological sites on the seabed 
or nearshore.'' The comment requests that BOEM specify that it may also 
request information on ``culturally significant sites, including 
viewsheds and traditional cultural landscapes and properties.''
    Certainly, with or without the addition of this language, 
commenters may submit such information. Indeed, BOEM's Calls for 
Information and Nominations are open-ended and request whatever 
information commenters care to share. Listing other regulatory 
categories of information that BOEM may specifically request is 
unlikely to result in the generation of more data.
    As a practical matter, BOEM does request such information (and much 
more) when it issues such Calls. For example, in the Call for the 
Central Atlantic, published April 29, 2022, BOEM requested information 
on ``known archaeological and cultural resource sites on the seabed,'' 
``the identification of historic properties or potential effects to 
historic properties,'' ``visual resources and aesthetics, the potential 
impacts of wind turbines and associated infrastructure to those 
resources, and potential strategies to help mitigate or minimize any 
visual effects,'' and ``other relevant socioeconomic, cultural, 
biological, and environmental data and information.''
    Comment: The commenter also recommended increasing the time between 
the FSN and the auction to 60 days to strike a balance between an 
efficient auction schedule and orderly development.
    Response: As a practical matter, BOEM ordinarily schedules more 
than the currently required 30 days between the FSN and the sale. 
However, increasing the minimum time between the FSN and the sale would 
eliminate BOEM's discretion to use a shorter waiting period and is not 
likely to enhance orderly development. Typically, the PSN is published 
several months before the FSN, and potential bidders are provided a 60-
day period to review and comment on the proposed terms and conditions 
of the sale. By the time BOEM issues the FSN, the terms and conditions 
of the sale are well known. There are circumstances where BOEM may need 
to limit the time between the FSN and the sale, for example, to permit 
scheduling flexibility related to holidays, the scheduling of other 
lease sales, or other potential conflicts.
    Comment: A commenter recommended amending Sec.  585.235(a)(4) so 
the operations period does not begin until the commissioning of the 
final power producing facility or power distribution system is 
complete. The commenter said that commercial operations must be allowed 
to begin as wind turbines are installed and commissioned, as is the 
standard practice in the industry. The commenter recommended approving 
commercial operations prior to installation of power producing 
facilities based on the approved FDR/FIR, with the ability for BOEM/
BSEE to revoke permission for commercial operation if conditions are 
not being met. Additionally, the commenter suggested providing lessees 
the opportunity to remedy errors before permission for commercial 
operations is revoked. The commenter reasoned that early commercial 
operations provide economic benefits, including a cashflow balance 
``for the lessee during the installation stage where substantial outlay 
of capital is being made,'' early revenue that incentivizes early 
installation, and safety benefits, including aerodynamic dampening that 
counteracts hydrodynamic loading on the tower and foundation, 
maintaining the structural fatigue lifetime of the structure.
    Response: BOEM and BSEE considered many alternative ways to 
structure the commercial operations issues identified in the NPRM, 
including the one suggested in this comment. BOEM and BSEE agree that 
assuming BSEE and the CVA are satisfied that the installation and 
commissioning process is proceeding smoothly, turbines should be 
permitted to run and generate electricity as part of the testing and 
commissioning process. BOEM and BSEE, therefore, tied the commencement 
of commercial operations with the submission of required information 
under 30 CFR 285.637, including the ability to submit interim 
documentation, to facilitate testing and continuous operations as 
facilities reach first power. Under the revised Sec.  285.637, the CVA 
may submit interim PVRs for subdivisions of a project's facilities 
installed prior to commencing commercial operations. Assuming no 
objections from BSEE, the lessee may begin commercial operations on 
that portion of the lease and continue commercial operations on that 
portion as other subdivisions of the project are brought online in the 
same way. This is meant to accommodate industry norms for commissioning 
projects safely and economically, while retaining BSEE oversight over 
the entire process. With the revisions made to Sec.  285.637 in place, 
BOEM and BSEE decided to keep ``commercial operations'' tied to the 
``generation of electricity or other energy product for commercial use, 
sale, transmission or distribution from a commercial lease.''
    Comment: To provide clarity and predictability, a commenter 
proposed revised text at Sec.  [thinsp]585.628(c), eliminating the 
stipulation that it applies only to post-lease submissions, and adding 
explicit references to subparts D and E of the CZMA.
    Response: BOEM has referenced both 15 CFR part 930, subparts D and 
E, in the proposed rule under Sec.  585.627(b)(9). The provisions set 
forth in 15 CFR part 930, subpart D are applicable to a COP that is 
submitted prior to lease issuance

[[Page 42626]]

and the provisions of 15 CFR part 930, subpart E, are applicable to a 
COP that is submitted after lease issuance. As noted in the CZMA 
regulations, 15 CFR part 930, subpart D, requires the applicant/lessee 
to submit all of the necessary data and information as well as the 
consistency certification to both BOEM and the State's coastal 
management program at the same time. In addition, as stated in proposed 
Sec.  585.628(c), under 15 CFR part 930, subpart E, the applicant/
lessee would submit the necessary data and information as well as the 
consistency certification directly to BOEM and BOEM will forward the 
COP, consistency certification, and associated data and information to 
the applicable State CZMA agencies.
    Comment: A commenter expressed general support for the proposed 
rule for re-offering leases at auction or when a lease area is 
relinquished, contracted or canceled.
    Response: BOEM is finalizing the referenced proposal re-offering 
leases at auction or when a lease area is relinquished, contracted or 
canceled.
    (b) Auction Processes and Rules.
    Comment: A commenter requested additional information on the 
proposed changes to auctions. The commenter requested that more project 
information be made available to the commenter, a Tribal Nation, as 
early as possible, and recommended that BOEM build in clear triggers 
for tribal consultation at every stage.
    Response: BOEM currently works to make project information publicly 
available as quickly as practicable. The comment did not specify what 
project information BOEM should release sooner. The commenter's 
location on the Pacific Coast suggests that it may believe that BOEM is 
withholding project information related to California leases, but no 
projects have been proposed on those leases and BOEM has no project 
information in its possession. Regarding consultations, BOEM is 
committed to honoring its Tribal consultation obligations. The 
regulations require Tribal coordination and consultation with the 
Tribal leadership for Tribes that may be affected by any leases, 
easements, or ROWs BOEM may issue (Sec.  585.102(e)). This occurs 
before the Call Area is identified, the earliest stage of the OSW lease 
process. BOEM invites representatives of affected Tribes to 
intergovernmental task forces, or other joint planning agreements. The 
regulations also require Tribal consultation prior to the issuance of a 
lease (Sec.  585.203), and during area identification prior to the 
competitive issuance of leases (Sec.  585.211(b)). BOEM also consults 
on a government-to-government basis at the request of any Tribe, and on 
actions that have Tribal implications. We did not revise the 
regulations to add triggers for consultations because this issue is 
beyond the scope of the current rulemaking.
    Comment: A commenter said BOEM needs to adopt a permanent supply 
chain mechanism to reduce uncertainty and give companies the confidence 
to invest in the domestic production supply chain, arguing that 
inconsistent lease stipulations confuse market signals necessary to 
spur investment.
    Response: BOEM believes the Bureau can best support a domestic OSW 
supply chain through predictable lease sale schedule and permitting 
timeframes. The supply chain and workforce bidding credits and related 
lease stipulations are not targeted or restricted to localized entities 
but intended to incentivize domestic investments in the supply chain 
and training. However, the comments did not suggest, and BOEM did not 
adopt, regulatory changes in response to this comment.
    Comment: A commenter encouraged BOEM to explicitly state a 
preference for minimizing changes to bidding credits between the PSN 
and the FSN.
    Response: BOEM acknowledges the challenge that modifying bidding 
credit provisions between the PSN and the FSN may be more time 
consuming for companies preparing bids. However, BOEM also seeks to be 
responsive to regional stakeholder interests and comments received 
during regional Task Force meetings and the PSN comment period. This is 
primarily a program implementation issue, and so it has not been 
addressed in the current rulemaking.
    (c) Multiple Factor Auctions and Bidding Credits.
    Comment: A commenter requested that the final rule clarify that the 
use of bidding credits in auctions must remain optional for 
participating bidders. The commenter stated that mandating that bidders 
accept the terms of bidding credits could reduce competitive interest.
    Response: Bidding credits or other factors in a renewable energy 
multi-factor auction have always been optional. The final rule remains 
silent on the mandatory versus optional nature of bidding credit or 
factors to provide future Department decisionmakers flexibility.
    Comment: A commenter opposed the non-monetary factors listed in the 
proposed Rule (30 CFR 585.216(b)(3)) due to the short auction period 
and potential difficulty of being able to commit to shared 
transmission. The commenter asserted that there is a need for criteria 
for transmission-related credits and suggested that BOEM consider 
alternative methods to promote shared transmission, such as conditions 
of State procurement and non-binding lease stipulations that require 
reasonable efforts to utilize shared transmission.
    Response: BOEM appreciates the comments on bidding credits. The 
list of bidding credits in Sec.  585.216(b) is intended to be 
representative and not exhaustive. The decision of whether to use 
bidding credits in a particular auction, and if so, which ones, is not 
governed by the regulations. Accordingly, BOEM has not revised the 
list, even though examples, such as the commenter has proposed, may be 
possible to investigate further and include in a future lease sale.
    Comment: A commenter asked for clarity in the final rule regarding 
the number of proposed penalties in the event that a lessee fails to 
comply with easement and right-of-way terms. A few commenters suggested 
modifying the definition of ``bidding credit'' to include a financial 
commitment attached to the bidding credits, for example, if a bidder 
receives a bidding credit for a CBA, the bidder should be required to 
expend a ``significant portion'' of the credit in funding those 
agreements. Without recommending revisions to the definition of a 
``bidding credit,'' a couple of commenters similarly recommended that 
all future bidding credits contain a financial commitment requirement.
    Response: BOEM has required an explicit financial commitment for 
some bidding credits in renewable energy lease sales. Attachment of a 
financial commitment to the definition of bidding credit would prohibit 
some kinds of bidding credit that the agency may want to consider in 
future auctions, like a bidding credit rewarding development experience 
or innovative project design. BOEM has no current plans to use such 
bidding credits, but the agency does not wish to constrain its 
discretion to do so in the future. The design of any bidding credits 
offered in a multi-factor auction is determined based on a balancing of 
regional and national needs consistent with BOEM's authority under the 
OCS Lands Act.
    Comment: A commenter said the added flexibility for BOEM to 
consider factors besides price in auctions has the potential for abuse. 
A couple of commenters asked BOEM to clarify how factors and their 
respective weights

[[Page 42627]]

would be determined, and how BOEM would assess whether the factors are 
in accord with the goals of the OCS Lands Act.
    Response: BOEM sets bidding credits in advance of each lease sale. 
Bidding credits are designed to be consistent with the OCS Lands Act. 
BOEM describes proposed bidding credits in the PSN, allowing for public 
comment, and provides all the information about applicable bid credits 
in the FSN prior to the lease sale. We do not agree that this final 
rule adds additional flexibility to the non-price factors that BOEM may 
use. BOEM had discretion under the previous regulations to hold 
auctions that recognize non-monetary factors, and BOEM retains that 
discretion in the final rule. In addition, the final rule more 
accurately describes how BOEM intends to use non-price factors in 
holding auctions. Accordingly, BOEM sees no potential for abuse in the 
final rule.
    Comment: Some commenters stated that bidding credits should not be 
based on or require that actions be taken in advance, rather, they 
should allow for identification of actions to be taken that are in 
alignment with BOEM's goals. A commenter said that bidding credits for 
actions a bidder has already taken would create unfair advantages and 
reduce competitive interest. Additionally, the commenter said it would 
reward past conduct, rather than incentivizing desired actions.
    Response: The requirements for BOEM's bidding credits are outlined 
in the specific FSN, lease, and Bidder's Financial Form Addendum. BOEM 
designs multiple-factor bidding credits to maintain a level playing 
field for all auction participants, but declines to address this issue 
in the regulations.
    Comment: A commenter expressed concern that two of the proposed 
categories for bidding credits (power purchase agreements, and pre-
established renewable energy credit eligibility) could limit 
competition and favor larger organizations with existing facilities. 
The commenter expressed support for the BOEM's goal to facilitate 
efficient development of OSW energy resources and encouraged BOEM to 
continue seeking opportunities to improve the regulatory permitting 
process, stating that the biggest gains in facilitating efficient 
development of OSW energy resources may be made there as opposed to the 
use of bidding credits.
    Response: We appreciate the input regarding bidding credits for 
power purchase agreements and pre-established renewable energy credit 
eligibility. BOEM sets bidding credits for each sale in the FSN. BOEM 
limits the bidding credit percentage, in part, to ensure the auction is 
still efficient. Through this rulemaking and other initiatives, BOEM 
seeks to improve its regulatory permitting process even as it evaluates 
potential bidding credits.
    Comment: A commenter expressed concern that it would be difficult 
for BOEM to implement the proposed bidding credits in Sec.  
585.216(b)(6) in a way that substantially benefits the public or 
furthers development of OCS renewables because many of the proposed 
credits are subject to uncertainty at the lease sale stage, which could 
lead to vague promises from bidders and distort the market with 
uncertain benefits to the public.
    Response: BOEM designed the bidding credits it has used in recent 
sales to include upfront commitments for investments, with follow-
through later in the lease term. This ability to refine planned 
investments over time to what is most needed in the future should help 
ensure that investments from the bidding credits are spent efficiently.
    Comment: A commenter suggested expanding the workforce development 
bidding credit program to allow for a bonus bidding credit if a 
developer commits to both utilizing a PLA and employing a workforce in 
which a significant majority of workers constructing and maintaining 
wind farms are United States citizens or permanent residents. The 
commenter also recommended extending the credit program to pre-existing 
lessees by allowing developers to take a credit against future 
operating fees, which would fulfill the Administration's goals of 
``increasing the likelihood or pace of development.'' According to the 
commenter, BOEM has authority to amend the regulation under 30 CFR 
585.506 to establish such an operating fee credit under applicable 
statutes and regulations, and it would be consistent with the IRA's 
apprenticeship requirement for renewable energy facilities. Another 
commenter also recommended revising Sec.  585.506 to clarify that BOEM 
may award operating fee credits in future lease sales and existing 
leases. The commenter provided revised regulatory text reflecting these 
proposed changes.
    Discussing the potential rewards for each credit in the recent 
California and Gulf of Mexico lease sales, a commenter recommended that 
future lease sales decrease disparities between bidding credits for the 
fishing community and others.
    Response: With regard to the workforce development and PLA bidding 
credit, BOEM already has the ability to implement such a bidding credit 
should it want to and no modification of the regulations is needed to 
permit BOEM to use such a credit. Commenters requested that BOEM add 
many examples to the representative list of bidding credits in Sec.  
585.216(b). Adding additional representative examples neither expands 
nor diminishes BOEM's bidding credit authority. BOEM has not added any 
of the requested examples because to do so could beg the question why 
other examples were excluded.
    Regarding operating fee credits, although BOEM used such credits in 
the New York Bight lease sale, it has not used them since them. BOEM 
has not ruled out using them in the future and has tools necessary to 
do so if desired. The revision requested in Sec.  585.506 would be 
needed were BOEM to amend existing leases to conditionally reduce the 
operating fee payments of existing lessees. This was not the purpose of 
the rulemaking, and BOEM has no current plans to offer such amendments 
to existing lessees. Accordingly, there is no need to revise the 
regulations as recommended by the commenter.
    Comment: Some commenters expressed opposition to a cap on bidding 
credits because it would curtail public policy priorities (e.g., 
advancing a domestic supply chain), BOEM's stated goals of flexibility, 
and it would narrow the OCSLA definition of ``fair return.'' A 
commenter said the final rule should allow a bidder to pursue multiple 
bidding credits at once, thus bidding credits should be capable of 
stacking. Likewise, the commenter opposed an ``artificial cap'' on the 
number of bidding credits a bidder can take, to ensure a fair return to 
the United States. A commenter wrote that BOEM ``should allow for 
stackable credits reflecting a bidder's commitment to provide workforce 
training, supply chain development, fisheries compensatory mitigation, 
and financial support for habitat and wildlife monitoring as eligible 
bidding credits at Sec.  585.216(b).''
    Response: BOEM sets bidding credits in advance of each lease sale 
and designs credits to ensure they are consistent with the OCSLA. BOEM 
has limited the non-monetary portion of its auctions to 25 percent of 
the asking price in past lease sales. Limiting the bidding credits to a 
percentage of the asking price promotes efficiency of the auction, 
ensures a fair return to the Government for OSW leases, and is 
consistent with Congress's intent to direct wind energy leasing 
revenues to the General Fund while also allowing

[[Page 42628]]

BOEM to use monetary bidding incentives to further OCSLA goals. 
However, nothing in the regulations imposes a specific limit on the 
percentage credit, and no regulatory revision would be needed to use a 
higher amount. Accordingly, no revision has been made.
    (c)(i) How bidding credits or factors might be tailored to mitigate 
possible adverse, project-related impacts.
    Comment: A commenter said developers should adhere to standard 
mitigation hierarchy by minimizing potential impacts prior to 
mitigation considerations. The commenter encouraged BOEM to establish 
lease stipulations and bidding credits to support activities including 
workforce development, local job creation, energy access and 
reliability, enhancing engagement and capacity building in communities, 
sustainable development, circular economy methods, and fisheries 
resiliency and/or compensatory mitigation.
    Response: BOEM appreciates this comment and will strive to avoid or 
minimize potential project impacts prior to considering mitigations. In 
addition, BOEM will continue to seek additional avenues for 
incentivizing accomplishment of worthy policy goals like those 
enumerated. Lease stipulations and bidding credits are determined on a 
case-by-case basis for specific lease sales, and not programmatically 
through regulations. Since this comment does not request any revision 
to BOEM's regulations, it is beyond the scope of the current 
rulemaking.
    Comment: A commenter recommended that BOEM add a credit to its non-
exclusive list in Sec.  585.216(b) for funding commitments for affected 
ocean users. A commenter recommended BOEM allow bidders to earn up to 
75% of cumulative credits for nonmonetary factors to ensure successful 
development ``when a bidder can deliver, prior to the auction, a 
minimum of three legally binding and enforceable agreements, each 
earning up to 25% credit, with (1) local stakeholders, (2) fishing 
industry group(s), (3) offtake agreement(s) with power purchasers and 
placement in the interconnection queue with power regulators, and (4) 
government agencies.'' The commenter outlined specific criteria and 
listed a series of yes or no questions to determine if a developer is 
eligible for each of the recommended agreements. A commenter 
recommended increasing the proposed non-cash bidding credit cap to at 
least 35%, stating that it would allow BOEM to manage the program in a 
manner that considers the environmental value of renewable resources on 
the OCS, potential impacts and benefits of renewable energy deployment, 
and equitable sharing of risks and benefits among various regions.
    Response: As the commenter noted, the list of non-monetary credits 
in the final rule is included as representative of the credits that 
BOEM may offer. BOEM will continue to consider bidding credits on a 
case-by-case basis based on the particular conditions of each lease 
sale.
    As for the amount of bidding credits, BOEM has limited the non-
monetary portion of its auctions to 25 percent of the asking price in 
past lease sales. Limiting the bidding credits to a percentage of the 
asking price promotes efficiency of the auction, ensures a fair return 
for OSW leases, and is consistent with Congress's intent to direct wind 
energy leasing revenues to the General Fund while also allowing BOEM to 
use monetary bidding incentives to further OCSLA goals.
    Comment: A commenter suggested that BOEM codify mitigation 
requirements in the final rule by incentivizing them through bidding 
credits or some other mechanism to ensure developers properly engage 
with ocean users, especially small businesses. Similarly, a commenter 
said BOEM should consider making certain factors mandatory, for 
example, developers should not be able to move forward until it has 
developed a CBA or mitigation fund. Alternatively, the commenter said 
BOEM could value the benefits to incentivize developers to negotiate 
them prior to NEPA review and the NHPA section 106 process.
    Response: The list of non-monetary credits in the final rule is 
included as representative of the credits that BOEM may offer. BOEM 
will continue to consider bidding credits on a case-by-case basis based 
on the particular conditions of each lease sale. At this time, BOEM 
does not find it appropriate to establish mandatory non-monetary 
credits to be used in every sale.
    Comment: A commenter said BOEM should consider awarding credits 
measured by the degree to which a developer mitigates harm to historic 
properties or cultural resources. A commenter said that BOEM should 
promote creditable stakeholder agreements, particularly those that 
mitigate conflict, improve project approval coordination, focus on 
engagement, and those that prioritize data sharing, local needs, 
regional scale conservation, or technological solutions to wildlife 
impacts.
    Response: The list of non-monetary credits in the final rule is 
included as representative of the credits that BOEM may offer. BOEM 
will continue to consider bidding credits on a case-by-case basis based 
on the particular conditions of each lease sale.
    Comment: Some commenters encouraged the use of bidding credits to 
mitigate impacts to fisheries. For example, a couple of commenters said 
bidding credits could fund research, encourage coordination between 
developers, and ensure minimum spacing between structures to minimize 
impacts to fisheries. A commenter said bidding credits could support 
regional fisheries funds to mitigate fisheries impacts.
    Response: The list of non-monetary credits in the final rule is 
included as representative of the credits that BOEM may offer. BOEM 
will continue to consider bidding credits on a case-by-case basis based 
on the particular conditions of each lease sale.
    Comment: A commenter supported bidding credits for fisheries 
mitigation as described in Gulf of Mexico Public Sale Notice Docket No. 
BOEM-2023-0021. Some commenters recommended that BOEM explicitly 
include benefits for the fishing industry to its list of non-monetary 
factors which may be included in multiple-factor auctions. For example, 
a commenter recommended additional text at Sec.  585.216(b): 
``agreements or commitments by the developer that mitigate for the 
impacts of development of the lease site on users of the lease space 
and contribute to the continued resilience of those users.'' Another 
commenter similarly recommended additional text that would include 
fisheries compensatory mitigation as an eligible bidding credit.
    Response: The list of non-monetary credits in the final rule is 
included as representative of the credits that BOEM may offer. BOEM 
will continue to consider bidding credits on a case-by-case basis based 
on the particular conditions of each lease sale. Therefore, BOEM did 
not make the requested changes to the regulations.
    (c)(ii) Comments on what impacts a project could have on 
underserved communities.
    Comment: A commenter said the main concerns of small fishing 
businesses and other ocean users, whom the commenter heard from in a 
small business roundtable, were related to mitigation of impacts to 
their businesses, and the need for BOEM to find ways to incentivize 
developers. According to the commenter, small fisheries expressed 
concern about

[[Page 42629]]

uncertain impacts wind energy developments could have on them; many 
stakeholders discussed an inability to adequately comment on the 
proposed rule and its potential impacts due to the number of unknowns, 
including BOEM's stance on mitigation. Additionally, the commenter said 
stakeholders felt the proposed rule was premature since BOEM has not 
finalized its guidance for mitigating impacts on fisheries.
    Response: BOEM will continue to work to ensure that information 
regarding OSW development is communicated from BOEM and lessees to 
impacted communities frequently and as early as possible in the 
process. BOEM does not believe additional regulation is necessary. It 
is not clear what effect finalizing fisheries mitigation guidance would 
have on this rulemaking, or why waiting for the guidance to be 
finalized would inform the provisions of this rule. Further, BOEM is 
intentionally developing guidance in lieu of a proscriptive rule to 
ensure BOEM retains broad flexibility to address potential impacts to 
fisheries.
    (c)(iii) Comments on how bidding credits or multiple factor 
auctions can be used to promote mechanisms that could address impacts 
and provide benefits to the underserved communities.
    Comment: A commenter said that bidding credits and stipulations 
could encourage developers to engage with community stakeholders and 
establish funds for underserved communities. The commenter said these 
auction mechanisms could deliver long-term benefits to communities by 
encouraging CBAs, regional funds, and workforce development. The 
commenter stated that stipulations and bidding credits that support 
apprenticeships, local and targeted hire, Project Labor Agreements 
(PLAs), and strong labor standards could provide equity benefits. A 
commenter said that bidding credits should reward actions that benefit 
local communities. According to the commenter, these actions should be 
identified prior to each auction through public input, with criteria, 
goals, and implementation strategies outlined in the PSN. Additionally, 
the commenter suggested that bidding credits requiring additional 
commitments by developers ``should be awarded in a manner that 
reasonably reflects the cost of the commitments and should be designed 
by BOEM in a manner such that the cost of compliance with bid credit 
requirements is quantifiable and predictable and has measurable 
outcomes based upon information available at the time of bidding.'' 
Lastly, the commenter said that bidding credits for achievement of 
development milestones appear unnecessary and unfair to states where 
certain milestones occur after the auction process concludes.
    A commenter recommended incentivizing agreements to address impacts 
identified through the NEPA and NHPA process.
    A commenter encouraged BOEM to use bidding credits for CBAs with 
disadvantaged communities to advance the Administration's Justice40 
goal. The commenter said BOEM could treat the credits as Federal 
investments within the rule and work with the Office of Management and 
Budget (OMB) to classify OSW activities as qualifying Justice40 
activities. Additionally, the commenter said benefits must be developed 
with the communities themselves. Additionally, the commenter 
recommended that BOEM consider enforcement mechanisms for ensuring that 
benefits promised by lessees are provided. Some commenters recommended 
BOEM establish specific criteria for obtaining bidding credits, 
including an agreement to consult with relevant labor unions, community 
groups, and industry representatives to ensure bidding credits are used 
equitably, result in accessible high-quality job creation, minimize 
impacts to marine economic activities, and advance civil rights, racial 
justice, and equal opportunity goals of the Federal government. Another 
commenter suggested that BOEM standardize the types of bidding credits 
for impacted communities and use a regional third party-managed fund 
for these contributions.
    Response: The list of non-monetary credits in Sec.  585.216(b) of 
the final rule is included as representative of the credits that BOEM 
may offer. BOEM will continue to consider bidding credits on a case-by-
case basis based on the particular conditions of each lease sale.
    Comment: A commenter said that BOEM should provide a competitive 
advantage to developers that demonstrate a commitment to collaboration 
with communities early in the process. For example, BOEM could give 
greater bidding credits to developers with existing binding agreements 
over developers with mere promises to develop agreements if awarded a 
lease.
    Response: The list of non-monetary credits in the final rule is 
included as a representation of the credits that BOEM may offer. BOEM 
will continue to consider bidding credits on a case-by-case basis based 
on the particular conditions of each lease sale. Further, incentivizing 
binding agreements prior to a lease sale could result in many bidders--
many of whom will be unable to win a lease--spending time and resources 
negotiating agreements. Because these will not result in projects that 
can move forward, such investments of time and energy on the part of 
both bidders and potentially affected communities will be wasted.
    Comment: Some commenters said, ``the Final Rule should require any 
conceptual strategy submitted to qualify for bidding credits be made 
publicly available and include details for development of a community 
benefits plan that commits to consultation with community stakeholder 
and labor unions to ensure credits result in quality jobs and equity.'' 
The commenters referred to DOE's Funding Opportunity Announcement for 
Regional Hydrogen Hubs Community Benefits Plans as a model for the 
information BOEM requires in conceptual strategies. According to the 
commenters, projects funded under this model are expected to include 
Community Benefits Plans that support meaningful engagement; invest in 
America's workforce; advance diversity, equity, inclusion, and 
accessibility; and contribute to the Justice40 Initiative. 
Additionally, the commenters said that bidding credits invested in 
supply chain facilities must require suppliers to use a supplier code 
of conduct that includes equitable access to jobs, among other things.
    Response: Conceptual strategy requirements are determined on an 
auction-by-auction basis and are outside the scope of the current 
rulemaking. BOEM does not make conceptual strategies publicly available 
to protect bidders' claims of business confidential information. BOEM 
could require bidders to submit conceptual strategies that do not 
contain such information, but BOEM would expect to receive less useful 
information as a direct result. Bidding credits offered for workforce 
training and supply chain development are designed to further the 
development of OSW and cannot be directed to specific communities.
    Comment: A commenter recommended that BOEM stipulate that lessees 
enter into PLAs covering the construction of renewable energy projects. 
The commenter stated that PLAs ensure access to unions, support 
training, promote safety, and increase economic benefits for local 
communities. Similarly, commenters said that PLAs and LPAs should not 
be credits, bidders should be required to certify that they will 
operate with PLAs and LPAs. Additionally, the

[[Page 42630]]

commenters said that workforce development should be considered in 
BOEMs multi-factor evaluation of bids, however, workforce development 
should exclude programs with no record of achievement. The commenters 
stated that bidders should be required to describe their workforce 
program's substance, history, and effort to recruit disadvantaged 
communities.
    Response: BOEM is very interested in promoting the use of union 
labor and PLAs, and BOEM has introduced language supporting the use of 
PLAs into our leases and the lease sale process for this purpose. 
However, BOEM declines, at this time, to require PLAs in all cases by 
regulation.
    Comment: A commenter said the final rule should include mandatory 
elements to address economic and environmental impacts to Tribes and 
adjacent communities, including a Tribal benefit agreement to offset 
all tribal impacts. The commenter said bidding credits should be 
awarded to bidders who have developed agreements with Tribes before the 
bidding process. A commenter said that funds accepted from developers 
need to provide direct funding to Tribes that they can use to hire 
independent technical experts to represent them/their interests, 
because the current process asks too much of Tribes without 
compensating them for their time.
    Response: BOEM seeks to mitigate economic and environmental impacts 
of projects on Tribes and adjacent communities throughout the leasing 
and development process. While BOEM recognizes the commenter's interest 
in bidders that are responsive to Tribal and other community needs, 
BOEM has declined to require bidders to engage with Tribes and 
communities before the lease sale takes place, understanding that 
outreach from bidders who will not win a lease may represent an undue 
burden for both Tribes and bidders. Providing a credit for pre-sale 
mitigation agreements would likewise represent unreasonable effort for 
both Tribes and bidders (particularly those that ultimately do not win 
a lease in the auction).
    Comment: Some commenters stated the policy-based factors described 
in Sec.  585.216(b)(5) should qualify for bidding credits. Some 
commenters recommended that BOEM implement bidding credits for funding 
affected Tribal Nations, underserved communities, fisheries, affected 
coastal communities, domestic supply chain development, and equitable 
workforce training. A commenter recommended that BOEM add to its non-
exclusive list in proposed Sec.  585.216(b) a credit for funding 
commitments for affected coastal communities and Tribal Nations. The 
commenter proposed regulatory language to reflect this revision. 
According to the commenter, including a credit for Tribal Nations could 
support socioeconomic benefits, and Tribal participation in the 
permitting process.
    Response: BOEM does not agree with the commenter's proposal to add 
additional language to Sec.  585.216. The bidding credits listed in 
Sec.  585.216(b) are meant to be representative, and BOEM retains the 
flexibility to add or remove bidding credits at a future time. Bidding 
credits are designed to further the development of OSW or mitigate 
impacts and cannot be directed to specific communities. The final 
rule's Sec.  585.216(b)(7) provides flexibility for BOEM to expand upon 
entities to whom the bidding credits may be offered.
    Comment: A commenter recommended that eligible credits should 
include bidder commitments to ensure that local underserved affected 
communities are prepared for offshore development via shoreside 
infrastructure, workforce development, supply chain, community 
benefits, and resilience measures for fishing industries; consult with 
and address concerns of Tribal nations; and ensure sustainable access 
for other ocean users including fisheries.
    Response: The list of non-monetary credits in the final rule is 
included as representative of the credits that BOEM may offer. BOEM 
will continue to consider bidding credits on a case-by-case basis based 
on the particular conditions or circumstances of each lease sale.
    (c)(iv) Comments on alternatives to achieving public policy goals.
    Comment: A commenter recommended including lease stipulations 
consistently across auctions (with some flexibility in deference to 
local context) for PLAs, domestic content utilization, environmental 
justice provisions, meaningful community engagement, domestic supply 
chain development, and environmental protections. The commenter also 
recommended BOEM explore other lease stipulations that could advance 
public policy priorities (e.g., workforce training, natural resource 
protection).
    Response: BOEM acknowledges the challenges that changes between 
lease sales cause for bidders. As a policy matter, BOEM tries to take 
this into account in developing the lease terms and auction format. 
However, BOEM also seeks to be responsive to regional stakeholder 
interests and comments received during regional Task Force meetings and 
the PSN comment period. BOEM must strike a balance between 
responsiveness to comments and not making unnecessary, or unnecessarily 
large, changes.
    Comment: Some commenters said that LPAs would advance goals under 
OCSLA, including ensuring a fair return to the United States.
    Response: BOEM is supportive of PLAs and has included lease 
language encouraging lessees to enter into PLAs for the construction 
stage of OSW projects. It is up to local bargaining units and OSW 
developers to negotiate PLAs terms that could include elements of LPAs. 
BOEM declines, at this time, to address either PLAs or LPAs by 
regulation.
    Comment: A commenter asked for the rule to establish annual 
compensation fees for marine-based ecosystem service losses due to wind 
plants. A commenter said revisions to Sec.  585.506 to allow for 
operating fee credits is a logical outgrowth of BOEM's proposal to 
formalize multiple factor auctions and bidding credits. A commenter 
said that a required annual payment on a lease, in the form of a lease 
stipulation, could be used for mitigation or compensation. The 
commenter described these operating fee credits as comparable to 
bidding credits but occurring outside of the auction stage and 
incorporated into lease stipulations. The commenter also said that BOEM 
could allow lessees to claim a bidding credit for an agreement to 
annually contribute the amount of the credit to a resiliency fund. The 
commenter suggested this option be made available for existing lessees 
as well.
    To further policy goals being pursued through bidding credits, a 
couple of commenters recommended the use of operating fees to provide a 
base level of funding to address ongoing project impacts, including 
investments in fisheries compensatory mitigation funds, disadvantaged 
communities, tribal needs, shoreside infrastructure, transmission, and 
supply chain and workforce development.
    Response: Proposals about annual compensation requirements, 
operating fee credits, and lease stipulations, whether for future 
lessees or existing ones, are outside the scope of the current 
rulemaking. However, these are initiatives that BOEM can still consider 
under the specific terms of a lease sale without the need of adding 
additional regulatory provisions.
    Comment: Some commenters said that BOEM has broad discretion and 
authority under OCSLA to require the use of domestically sourced 
materials. A commenter recommended that the

[[Page 42631]]

Secretary use such discretion to satisfy various subsection 8(p)(4) 
requirements through lease and COP terms, conditions, and stipulations. 
According to the commenter, doing so would be consistent with the 
Administration's climate goal.
    Response: BOEM is very interested in ensuring, as much as it can, 
that the U.S. supply chain is adequately developed and capable of cost-
effectively serving the needs of the U.S. OSW industry. The most 
important factor needed to enable the supply chain to become 
sufficiently developed is a reliable pipeline of OSW projects. BOEM 
strives to make suitable offshore acreage available for this purpose, 
but it is also important that the cost of OSW be low enough for states 
and utilities to support it. This means balancing the desire to 
accelerate domestic sourcing with controlling OSW development costs. 
For this reason, BOEM has investigated other methods of promoting the 
domestic supply chain, such as bidding credits, over potentially more 
costly options such as a requirement to source materials domestically.
    (d) Improper or Inappropriate Bidder Communications.
    Comment: A few commenters agreed with the overarching intent of 
BOEM's proposal to prohibit improper or inappropriate bidder 
communications; however, they suggested revisions to BOEM's proposed 
language in Sec.  585.222(f). A couple of commenters stated that the 
proposed language at Sec.  585.222(f) is too broad, expressing concern 
that the proposed language could prevent legitimate and necessary 
conversation between potential joint-venture participants and limit 
participation in auctions. A commenter recommended revising the 
provision ``to state that the prohibited communications are limited to 
those between bidders who actually participate in an auction (not 
precluding conversations between two bidders listed in a FSN where one 
bidder ultimately does not participate) and involve strategies and 
valuations related to a specific auction (not precluding discussions 
about high-level strategies and valuation approaches).''
    Response: BOEM decided not to finalize the proposed regulations 
regarding bidder communications. BOEM sees advantages to the proposal 
that BOEM made in the NPRM. BOEM also sees that commenters raised valid 
concerns with the proposed language. However, BOEM has questions about 
some of the specifics of the commenter's proposals. Accordingly, BOEM 
declines to add regulatory provisions governing bidder communications 
at this time. Bidder communications can continue to be regulated on a 
case-by-case basis in the sale notices of BOEM lease sales. Further, 
BOEM notes that notwithstanding BOEM's regulations regarding 
communications prior to an auction, bidders remain subject to antitrust 
laws, which may prohibit behavior not specified in BOEM's regulations.
    Comment: Another commenter recommended specific revisions to Sec.  
585.222 as follows: ``[add: (c) Bidders qualified by BOEM under 
Sec. Sec.  585.106 [585.107] and 585.107 [585.108] must notify BOEM no 
later than the due date of the Bidder's Financial Form of (1) any 
change to the corporate form or identity of the qualified bidder (or 
its members if the qualified entity is a partnership or limited 
liability company); or (2) a material reduction in the technical or 
financial capabilities of the qualified bidder.]
    ([add: d] [delete: c]) Only an authorized agent may act on a 
bidder's behalf during an auction. Bidders must submit the names of 
their authorized agents to BOEM before the auction, as prescribed in 
the FSN.
    ([add: e] [delete: d]) Each bidder must follow the auction process 
specified in the FSN and may not take any action to disrupt or alter 
the process beyond its intended function.
    ([add: f] [delete: e]) A bidder is responsible for immediately 
contacting BOEM if it is unable to submit its bid for any reason during 
an auction. If a bidder fails to timely notify BOEM of its inability to 
bid, it may not dispute the auction or lease award on that basis. If a 
bidder timely notifies BOEM of its inability to submit a bid, BOEM, in 
its discretion, may suspend the auction, continue the auction using an 
alternative method, or continue the auction without the participation 
of the affected bidder.
    [Delete: (f) Bidders may not disclose their auction strategies or 
economic valuations of a lease area to other bidders listed in the 
FSN.]
    [Add: (g) Notwithstanding your eligibility pursuant to section 
585.106 and section 585.107, you may not participate in a lease sale 
under this Part if another person with whom you are affiliated 
participates separately in the same lease sale.
    (h) An affiliate is a bidding entity who controls, is controlled 
by, or is under common control with another bidding entity, as may be 
specified in more detail in the final sale notice for a lease sale.
    (i) An agreement between two persons for future shared investment 
in a lease to be sold by us pursuant to section 585.220 or section 
585.231 does not itself create affiliation but must be disclosed to 
BOEM in writing by the date specified in the final sale.
    (j) Where the final sale notice for a lease sale states that a 
bidder may not win more than a specified number of leases offered for 
sale, BOEM may exclude from participation in the lease sale any person 
who has entered into a joint bidding agreement(s) or a future shared 
investment agreement(s) that would cause the person to be affiliated 
with the initial owner(s) of more than the specified number of leases 
offered for sale.
    (k) If you are eligible pursuant to section 585.106 and section 
585.107, you may participate in a lease sale on behalf of yourself and 
one or more other person(s) eligible to participate in the lease sale 
provided that (i) you notify us in writing of your intention to do so 
by the date specified in the final sale notice and (ii) these other 
bidder(s) do not otherwise participate in the lease sale.]''
    Response: BOEM has not adopted the language proposed by the 
commenter in the final rule. Much of the content of this proposal can 
be implemented outside the rulemaking process, and BOEM declines to 
finalize language in this rule absent further consideration and 
opportunity for public comment.
    Comment: A commenter opposed BOEM's proposed language in Sec.  
585.222(f), asserting that it is overly broad and could impede 
appropriate commercial speech. The commenter also asserted that it 
would reduce competition and BOEM's ability to obtain a fair return for 
the U.S. taxpayers and is unnecessary due to antitrust review conducted 
by the U.S. Department of Justice.
    Response: BOEM eliminated the proposed Sec.  585.222(f) that BOEM 
had proposed to add in the NPRM. Although BOEM believes it is 
appropriate to restrict communications between bidders for policy 
reasons related to antitrust and anticompetitive concerns, commenters 
raised valid concerns about the specific language proposed. BOEM, 
however, declines to address this in the manner proposed by the 
commenter, by creating a new section governing BOEM's implementation of 
one-per-customer restrictions in lease sales.
    BOEM will continue to restrict bidder communications, and one-per-
customer restriction implementation, on a case-by-case basis in lease 
sale documents rather than in the final rule as it continues to refine 
its requirements.
    Comment: A couple of commenters requested that BOEM define 
``affiliated entities'' or ``affiliate,'' including what constitutes 
``control'' of one entity over

[[Page 42632]]

another. A commenter said it should be clear that ``control'' extends 
only to the immediate parent(s) of the bidding entity.
    Response: BOEM has decided to retain the flexibility to continue to 
develop its definition of affiliates in individual lease sales, and so 
has not included a definition in the final regulations.
    (e) Other comments on lease issuance procedures.
    Comment: Some commenters recommended maintaining the current 
requirements for area identification that state, ``BOEM will develop 
measures . . .'' rather than the proposed revision which states, ``BOEM 
may develop measures . . .'' Some commenters expressed concern that the 
proposed revision would create uncertainty and weaken mitigation 
standards.
    Response: BOEM's existing regulations on area identification state 
that ``BOEM will evaluate the potential effect of leasing on the human, 
marine and coastal environments and develop measures to mitigate 
adverse impacts including lease stipulations'' (Sec.  585.211(b)(2)), 
and ``BOEM will consult to develop measures, including lease 
stipulations and conditions, to mitigate adverse impacts on the 
environment'' (Sec.  585.211(b)(3)). The proposed language in the NPRM 
states that ``BOEM may develop measures, including lease stipulations, 
to mitigate potential adverse impacts.''
    It was never BOEM's intention to signal that BOEM may not develop 
measures, including lease stipulations, to mitigate potential adverse 
impacts. Stipulations and mitigations can be identified at any time 
before the FSN is published, and the process of flagging such measures 
begins early in the process. Accordingly, BOEM has changed ``may'' back 
to ``will'' in the final rule. Moreover, BOEM added Sec.  585.212(c)(3) 
to clarify that measures will continue to be developed through later 
environmental reviews and consultations and will be published in the 
PSN.
    Comment: A commenter recommended revisions to BOEM's lease planning 
regulations at 30 CFR part 585, subpart B, to support advanced planning 
for shared transmission systems.
    Response: BOEM continues to advance a more planned approach to 
transmission solutions for offshore wind, including the use of shared 
infrastructure. BOEM has the authority to permit shared transmission 
infrastructure through both the COP and ROW processes. It should be 
acknowledged that State processes play a large role in the potential 
use of shared transmission systems, and accordingly, BOEM has sought to 
improve clarity for the process where a State or RTO/ISO is involved by 
revising 585.307(c).
    Comment: A commenter said that BOEM should clarify the meaning of 
``in a timely manner'' in proposed Sec. Sec.  585.231(f) and 
585.306(b)(2).
    Response: The CZMA regulations under 15 CFR part 930, subpart D do 
not have a set time requirement for the applicant to submit the 
consistency certification and the necessary data and information to the 
State CZMA agency. It is implied that the applicant will submit the 
information necessary to conduct an adequate consistency review in a 
timely manner so as not to delay the progress of the application for 
approval of a noncompetitive lease. The time requirements outlined in 
15 CFR 930.60 go into effect upon submittal of all necessary data and 
information required by the State's CZMA agency. Therefore, BOEM added 
the phrase ``in a timely manner'' to proposed Sec.  585.231(f) to 
stress to the applicant that delay in submitting the consistency 
certification and necessary data and information to the State's CZMA 
agency and BOEM may delay its application. As provided in proposed in 
Sec.  585.231(e)(2), BOEM reserves the right to withdraw a 
determination of no competitive interest before the two-year expiration 
date if BOEM determines that the applicant has failed to exercise due 
diligence in obtaining a lease. To be consistent, and for the same 
reasons as above, BOEM has revised the second sentence of Sec.  
585.306(b)(2) in the final rule to read, ``After BOEM publishes this 
notice, you are responsible for submitting any required consistency 
certification and necessary data and information in a timely manner to 
the applicable State CZMA agency and BOEM pursuant to 15 CFR part 930, 
subpart D.''
    Comment: A commenter requested that BOEM ``codify the concept that 
a bid awardee from a state solicitation process is the only qualified 
applicant for the Right-of-Way/Right-of-Use and Easement (ROW/RUE) 
grant for the relevant OSW transmission project(s) and therefore, there 
is no competitive interest for that grant.'' The commenter said this is 
necessary to ensure projects are not delayed due to an unnecessary 
competitive grant process. The commenter reasoned that a key factor in 
determining competitive interest is whether a party is ``qualified'' to 
hold a ROW/RUE grant, and BOEM can reasonably determine that 
transmission developers who were unsuccessful in the State solicitation 
process are not qualified. Next, the commenter said BOEM would 
determine whether there is a conflict for the proposed project area. 
The commenter said it is unlikely that BOEM would determine that there 
is a conflict for the proposed area, because ROW and RUE grants are 
non-exclusive rights and therefore unlikely to exclude future uses of 
the area.
    Response: The commenter has highlighted an important issue related 
to determining competition for a ROW/RUE and the interaction of this 
process with State processes where the OCS project crosses into State 
jurisdictional waters. However, the qualifications process suggested by 
the commenter is not the best way to address such issues. Any grantee 
or lessee is required to be qualified legally, technically, and 
financially prior to issuance of a grant or lease. A company is 
permitted to qualify as a prospective company at any time, including 
prior to entering any State solicitation process. Therefore, being 
qualified to acquire a lease or grant is not a good indicator of 
competitive interest.
    BOEM currently has the authority to issue a ROW/RUE grant either 
competitively, or non-competitively as described in Sec. Sec.  585.300-
585.316, after coordinating and consulting with relevant Federal 
agencies, the Governor of any affected State, and the executive of any 
affected local government. BOEM must first determine if there is 
competitive interest, which is accomplished by publishing a public 
notice describing the parameters of the project, to give affected and 
interested parties an opportunity to comment on the proposed grant 
area. BOEM currently has the authority to work with a State seeking a 
ROW/RUE grant for purposes of transmission, and as the ROW would 
necessarily need to be continued through State waters and land for the 
purpose of interconnection to the grid, there is a need to align these 
processes. However, BOEM agrees that regulatory clarity is helpful in 
this instance and has revised Sec.  585.307(c) of the final rule to 
acknowledge the complications that may arise in determining competitive 
interest for transmission projects and to note that coordination with 
projects authorized on State submerged lands may be taken into 
consideration in making competitive interest determinations.
    Comment: A few commenters suggested that a BOEM-run auction is not 
the only option for a competitive process that would meet OCSLA 
requirements. One commenter suggested that BOEM allow a State to hold a 
competitive solicitation process and award a lease to the winner of 
that

[[Page 42633]]

auction process. This commenter also suggested that BOEM include in the 
final rule that any legally binding agreements to undertake future 
shared lease investment should be disclosed to BOEM prior to the sale 
but does not create an affiliate definition. The commenter further 
suggested that BOEM exclude from auctions any person who has entered 
into such an agreement when there are restrictions in the FSN.
    Response: BOEM appreciates the creative thinking on meeting OCSLA's 
competitive mandate. BOEM has considered adopting a State competitive 
process as meeting the competitive requirement for issuing a lease, 
however, BOEM has also identified several important challenges with 
such an approach, including timing (State solicitations normally 
require that applicants demonstrate site control) and challenges around 
coordinating with State RFPs, and the fact that most State RFPs contain 
requirements and considerations that would not normally be found in a 
Federal offering.
    BOEM acknowledges the concern about drafting a definition of 
affiliation that does not unnecessarily restrict joint ventures and 
otherwise permissible forms of collaboration on OSW but has declined to 
include such language in the final rule, preferring to address this in 
individual lease sales.
    Comment: A commenter said that it seems like a logical outgrowth of 
BOEM's proposed revisions to Sec.  585.222 to add information about the 
appropriate process to update qualification materials during BOEM's 
review or after BOEM's confirmation of qualification. The commenter 
said that only changes to corporate form or identity of the bidder, and 
changes that materially reduce the technical or financial capabilities 
of the bidder should merit notice to BOEM. Accordingly, the commenter 
requested that BOEM include a provision in Sec.  585.222 describing 
when BOEM must be updated and how/when eligible bidders must notify 
BOEM of relevant changes. The commenter suggested further revision to 
Sec.  585.222 to allow for joint bidding in lease sales and to define 
an ``affiliate.'' The commenter provided draft regulatory text that 
would implement these modifications.
    Response: BOEM has added language to Sec.  585.222 describing new 
triggers for qualification determinations. BOEM has declined to add a 
definition of ``affiliate'' to the regulations at this time. BOEM's 
sale notices provide the specific requirements in instances where 
bidders are participating in joint ventures. BOEM does not see a need 
to establish these requirements by regulation.
3. What is the Department finalizing?
    (a) Sec.  585.106 What happens if I fail to comply with this part?
    BOEM is finalizing the proposed clarifications of its process 
surrounding the imposition of civil penalties. BOEM made minor 
revisions to this provision to ensure consistency with OCSLA.
    (b) Sec.  585.210 What are the steps in BOEM's competitive lease 
award process?
    BOEM is largely finalizing the NPRM proposal to reorganize, 
simplify, and clarify the regulatory sections detailing the steps 
leading to an OCS renewable energy auction. The final rule preserves 
the concept of a ``provisional winner'' that was introduced in the 
NPRM, referring to a successful bidder before the execution of a lease, 
at which point a ``provisional winner'' can become a ``lessee.'' 
Revised Sec.  585.225 combines the reconsideration and appeals 
provisions into a single paragraph (e). BOEM also removed the 
requirement to execute three copies of the lease, which is appropriate 
given the more widespread adoption of electronic forms, which was 
already underway in 2020, but accelerated during the COVID-19 period.
    BOEM is eliminating the ``Request for Interest,'' which was similar 
enough in name and purpose as to be frequently confused with the 
``Request for Information.'' BOEM retains the Request for Information, 
described in Sec.  585.116, which BOEM may use to gather any manner of 
information from industry, federally recognized Tribes, State and local 
agencies, and other interested entities. Accordingly, the Request for 
Information can easily be employed to gather the same public input that 
would once have been solicited in a Request for Interest.
    BOEM reviewed the request to include ``archaeological and/or 
culturally significant sites on the seabed or nearshore, including 
viewsheds and traditional cultural landscapes and properties.'' BOEM 
determined that the final rule will require this information to be 
included in SAP, COP and GAP. The list to which the commenter requested 
to add the specified language is merely suggestive of the kind of 
information that BOEM may request. The regulations list a few of the 
kinds of information that BOEM can specifically request in these 
notices, but the intent is not to provide a list of all the information 
that BOEM could request. In practice, BOEM does request other kinds of 
information. For example, in a recent California Call for Information 
and Nominations (86 FR 40869), BOEM requested that the public submit 
information on viewshed, archaeological and cultural resources sites, 
and historic properties. In other words, BOEM is already requesting the 
information that the commenter has asked BOEM to add to the 
regulations.
    (c) Sec.  585.213 What information is included in the PSN?
    Sec.  585.214 What information is included in the FSN?
    The final rule simplifies and clarifies auction regulations, mostly 
as proposed in the NPRM. The final rule replaces the lists of 
permissible auction formats, bid variables, and bidding processes with 
a more flexible process consistent with current BOEM practices. Under 
the revised regulations in Sec.  585.213, BOEM will propose auction 
procedures for 60-calendar day comment in a PSN, including auction 
format and lease terms and conditions. Final auction details, under 30 
CFR 585.214, will be published in the FSN at least 30 calendar days 
before the auction. These changes would permit BOEM to hold lease sales 
that do not conform to the previously enumerated auction formats and 
bidding systems, should circumstances warrant, though BOEM has no 
immediate plans to do so.
    (d) Sec.  585.216 How are bidding credits awarded and used?
    BOEM is finalizing provisions pertaining to multiple factor 
auctions and bidding credits in Sec.  585.216. These were permitted 
under BOEM's existing regulations; however, the final rule establishes 
bidding credit authority that better reflects how these have been 
implemented in BOEM's lease sales. Bidding credits permit the agency to 
recognize other policy priorities, like advancing a domestic supply 
chain or promoting workforce training, in addition to monetary bid 
amounts. BOEM may design bidding credits that are based on actions the 
bidder has already taken or for commitments to take future actions. The 
final rule also specifies in Sec.  585.225(g) that BOEM can force a 
bidder to repay the amount of the bidding credit, with interest, if it 
does not meet the applicable commitments. This authority is backed up 
by its authority to assess civil penalties under Sec.  585.106(e). 
BOEM's bidding credits provisions are included in revised Sec.  
585.216. BOEM lists a half dozen examples of bidding credits that the 
agency could choose to implement in a lease sale. BOEM declined to add 
to this list, despite comments requesting the addition of specific 
other bidding credits. However, the list is not exhaustive, permitting 
the agency to offer bidding credits in future lease sales

[[Page 42634]]

for ``any other factor or criteria to further development of offshore 
renewable energy, as identified by BOEM in the PSN and FSN.''
    (e) Sec.  585.222 What other auction rules must bidders follow?
    BOEM is not finalizing the provision proposed in new Sec.  
585.222(f) that would have prohibited a bidder from disclosing auction 
strategies or economic valuations of a lease area. BOEM may still 
prohibit such communications in the auction rules published pursuant to 
individual lease sales, however, commenters raised questions about the 
definition proposed by BOEM, and given BOEM's authority to regulate 
this in individual lease sales, the agency has decided not to finalize 
the prohibited communications provision at this time.
    (f) Sec.  585.224 What will BOEM do after the auction?
    Post-auction procedures are likewise revised, largely tracking the 
proposals detailed in the NPRM. In Sec.  585.225(f), BOEM changed the 
due date for payment of the first 12 months' rent on a new lease to 45 
calendar days after the winning bidder receives a copy of the executed 
lease from BOEM.
    (g) Sec.  585.225 What happens if BOEM accepts a bid?
    Section 585.225 addresses obligations of provisional winners after 
the auction and before execution of a lease. From the date of receipt 
of the unsigned lease, the provisional winner has 10 business days in 
which to execute and return the lease to BOEM, file the required 
financial assurance, and pay the amount due. The provisional winner may 
request an extension of the 10-day deadline in writing.
    (h) Sec.  585.226 What happens if the provisional winner fails to 
meet its obligations?
    The final rule adds clarifications on what actions BOEM may take if 
the provisional winner fails to timely complete these steps. Section 
585.226(a) authorizes BOEM to decline to execute the lease, decline to 
execute other leases that the provisional winner may have won in the 
auction, require forfeiture of the bid deposit, refer the matter for 
suspension or debarment review, or impose other remedies. Further, 
under Sec.  585.226(b), BOEM may award the lease to the next highest 
bidder, repeat the auction under Sec.  585.224(f), or use any other 
procedures specified in the FSN.
    (i) Sec.  585.438 What happens to leases or grants (or portions 
thereof) that have been relinquished, contracted, or cancelled?
    The final rule adopts proposed Sec.  585.438, which describes 
actions that BOEM may take if a lease or grant is relinquished, 
contracted, or cancelled. Before this rulemaking, the regulations were 
silent about how BOEM would address such cases. Under paragraph (a) of 
this section, BOEM may restart the competitive process at a stage that 
BOEM deems reasonable (e.g., from the beginning, from the Call, Area 
Identification, PSN, or FSN). Under paragraph (b), if the lease or 
grant is relinquished, contracted, or cancelled within six months of 
the lease sale, BOEM may reoffer it to the next highest bidder.

G. Risk Management and Financial Assurance

1. What did the Department propose?
    Sec. Sec.  585.516; 585.520; 585.521; 585.526; 585.527; 585.528; 
585.529.
    BOEM proposed four main amendments and requested comment on two 
concepts in the NPRM preamble (88 FR 5987). The four main amendments 
were: a) eliminating the COP approval financial assurance requirement 
(Sec.  585.516); b) revising lease-specific financial assurance amounts 
(removal of Sec.  585.515 and changes to Sec. Sec.  585.520 and 
585.521); c) accepting additional types of financial assurance 
instruments (Sec. Sec.  585.526 and 585.528); and d) funding of 
decommissioning accounts based on a BOEM-approved schedule (Sec. Sec.  
585.516 and 585.529). BOEM also requested public comment on these two 
concepts: e) using a minimum credit rating threshold for BOEM's 
evaluation of the financial strength and reliability of a lessee, grant 
holder, or third-party guarantor (Sec.  585.527); and f) explicitly 
relying on financial strength and reliability evaluation of joint and 
severally liable parties when determining the need for financial 
assurance.
2. What are the key public comments?
    (a) Sec.  585.516 Elimination of COP approval financial assurance 
requirements.
    Comment: Multiple commenters expressed support for BOEM's proposal 
to eliminate the supplemental financial assurance currently required 
before COP approval. The commenters stated that the proposed change 
would encourage offshore wind development by reducing overly burdensome 
financial assurance requirements while continuing to protect the public 
against risks of default. Additionally, commenters highlighted that 
decommissioning liabilities do not accrue from COP approval, only with 
the commencement of approved activities on the OCS.
    Response: BOEM has finalized moving the deadline for complying with 
financial assurance requirements from the COP stage to prior to 
starting construction. BOEM feels that an adequate balance between the 
need to protect the U.S. taxpayers and not overburden the industry with 
financial requests that do not reflect the actual risk that is being 
mitigated, is in accordance with the proposed elimination of 
supplemental financial assurance before there is an actual liability 
that needs to be covered by financial assurance.
    Comment: A commenter expressed opposition to elimination of the COP 
approval financial assurance requirement and stated that it was an 
irresponsible proposal by BOEM. The commenter stated that ``the 
proposal presumes financial project viability and consistent ongoing 
revenues for a period of 35 years or more with disregard for uncertain 
financial, environmental, engineering, legal, and weather-related 
risks.'' They further stated that ``[e]nergy-utility projects are in 
essence traditional public-private partnerships where technical and 
financial risks are transferred to the private sector in exchange for 
the opportunity to generate revenues and profit. Under the proposed 
rule, the Federal government is instead transferring risks associated 
with decommissioning to the consumer rather than to the private 
sector.''
    The commenter states that ``[w]hile BOEM believes that if a 
developer becomes insolvent during commercial activity that a solvent 
entity would assume or purchase control, the County believes this is a 
risky assumption as the most likely reason for default is that a 
constructed wind farm developer is unable to meet its contractual 
obligations set forth under a Power Purchase Agreement (PPA) because 
its energy production revenues are not in excess of its operating 
costs. A change of hands would not remove these circumstances or make 
the project profitable.''
    Response: The first part of this comment discusses financial 
assurance requirements at COP approval, which occurs prior to any 
offshore facility installation. Since BOEM's financial assurance 
requirements reflect a project's liabilities, there is no reason to 
require financial assurance until facility installations begin. BOEM 
does not agree with the commenter that the period between COP approval 
and installation presumes a level of viability, that it would last 35 
years, or that this proposal transfers all risk to the consumer rather 
than the private sector.

[[Page 42635]]

    The second part of this comment relates to the provisions that 
allow lessees to fund a decommissioning financial assurance account 
over time on a schedule approved by BOEM. BOEM does not agree with the 
commenter that it would be a ``risky assumption'' that a project's 
energy production revenues would exceed its operating costs. Renewable 
energy projects typically have low operating expenses since there is no 
cost for fuel and the equipment only needs to be maintained. Therefore, 
the energy production revenue is several multiples of the operating 
expense. Having a decommissioning financial assurance account funded 
over time from that revenue should greatly reduce the chance that a 
lessee will not have sufficient resources to meet its decommissioning 
plans at the end of the lease.
    (b) Sec. Sec.  585.520-585.521 Lease-specific financial assurance 
amount.
    Comment: Multiple commenters expressed support for BOEM's proposed 
revision of the lease-specific financial assurance amounts and 
concurred this action would not compromise taxpayer protection. One 
commenter stated that under the current rule, BOEM is exposed to the 
risk of default only during the period between lease issuance and rent 
payment, and that risk is mitigated by BOEM's prequalification metrics, 
and the likely interest of the next highest bidder. An additional 
commenter stated that the lease-specific financial assurance amount 
revision should also address later stages of a lease, including the 
full decommissioning amount.
    Response: BOEM agrees that the proposed changes should reduce the 
upfront capital burden on lessees without compromising taxpayer 
protection. BOEM is finalizing the revisions to lease-specific 
financial assurance amounts as proposed. BOEM disagrees with the 
assertion that the lease-specific financial assurance amount proposed 
changes should also include decommissioning funds since there is no 
decommissioning liability associated with the mere act of purchasing a 
lease without facilities installed on it.
    Comment: A commenter stated that the lease specific financial 
assurance amount revision should also address later stages of a lease, 
including the full decommissioning amount.
    Response: BOEM disagrees with the commenter's assertion that the 
lease-specific financial assurance amount proposed changes should also 
include decommissioning funds since there is no immediate 
decommissioning liability associated with purchasing a new lease. Once 
there is decommissioning liability on a lease, following a COP 
approval, financial assurance will still be required. If the commenter 
is referring to Sec.  585.520, BOEM did not propose to eliminate any 
financial assurance requirement, it only proposed to require financial 
assurance by stages, to the moment in which the actual risk/liability 
exists, otherwise BOEM would be requiring financial assurance for a 
liability or risk that does not yet exist.
    (c) Sec. Sec.  585.526; 585.528 Additional authorized financial 
assurance instruments.
    Comment: Several commenters expressed support for BOEM's proposal 
to authorize additional financial assurance instruments, including 
letters of credit and other instruments not currently listed. One of 
those commenters stated that ``securities such as parent guarantees or 
bonds should be acceptable financial assurance in all circumstances . . 
. subject to reasonable negotiation. . . .''
    Response: BOEM is finalizing the proposed provisions, which will 
provide flexibility for lessees to fulfill their obligations. This 
ensures that lease obligations are fulfilled while providing 
flexibility for lessees to comply with their obligations.
    Comment: A commenter did ``not object'' to allowing letters of 
credit as financial assurance instruments, however, the commenter did 
object to the proposed catch-all provision that would grant BOEM 
authority to accept instruments not explicitly listed. The commenter 
cautioned against the use of a combination of instruments, other than a 
trust account combined with one other instrument, reasoning that it 
would be difficult to construct a layered combination that would 
provide the necessary financial assurance. The commenter discussed 
recent bank failures, claiming that not many companies could be relied 
upon for such large sums of money over the 30+ year span required for 
these projects. Additionally, the commenter objected to BOEM's proposal 
to allow guarantors to cap their liability at a specific amount, 
because it would require BOEM to accurately determine the dollar amount 
that will be needed in the future, which would put taxpayers at risk if 
BOEM underestimated the needed amount due to inflation or other 
unforeseen circumstances.
    Response: The proposed rule proposed to add catch-all provisions 
clarifying that BOEM may accept instruments not explicitly listed as 
well as combinations of different instruments; however, these 
instruments would need to meet BOEM's general requirements for 
financial assurance. BOEM was unable to determine why the commenter 
believes it would be difficult to layer a combination of financial 
assurance or why the reference to bank failures is applicable to the 
OSW industry, so BOEM cannot respond to those portions of the comment.
    Regarding the risk of underestimating the decommissioning 
liability, the risk is similar if a guarantor has limited its liability 
to a specific amount, if a surety bond provider has supplied a bond 
with a specific limit, or if the lessee has a fully-funded 
decommissioning account--the cost of decommissioning may exceed the 
original estimate and the lessee is still responsible for meeting that 
obligation. Since the risk is similar in each of these financial 
assurance instruments, BOEM is finalizing these amendments as proposed.
    Comment: A commenter stated that financial assurance ``could be 
provided with a combination of authorized financial instruments, but a 
fully funded trust account would be preferable from the public 
protection perspective.'' Additionally, they noted that ``the total 
amount they guarantee should from the start be the full decommissioning 
amount. If a trust fund is built up over time with operating revenues, 
then the additional financial supports could be reduced by a comparable 
amount.''
    Response: BOEM agrees that a fully funded trust account would 
provide a high level of protection. This approach could be too risk-
averse in some cases, however, and lead to unnecessary costs and 
administrative burdens placed on lessees. There could be other risk-
reduction factors present including insurance, performance guarantees, 
manufacturer warranties, or power purchase agreements that reduce the 
risk of non-performance and it is important to consider these in the 
overall financial assurance evaluation.
    (d) Sec. Sec.  585.516 and 585.529 Staged funding of 
decommissioning accounts.
    Comment: Three commenters stated that the decommissioning process 
is unclear, adding that industry should be required to obtain bonds to 
cover future decommissioning for both towers and offshore export cable 
corridors.
    Response: As discussed in the preamble to the proposed rule (at 88 
FR 5987), under the existing subpart E of part 585, BOEM requires 
lessees and grant holders to provide financial assurance, in the form 
of a bond or other instrument, in an amount sufficient to guarantee 
compliance with terms and conditions of their leases and grants, 
including decommissioning. BOEM's

[[Page 42636]]

approach requires supplemental financial assurance to cover 
decommissioning when there is a risk that the current lessee will not 
be able to meet its performance obligations. BSEE's regulations at 30 
CFR part 285, subpart I require that, within 2 years following 
termination of a lease or grant, the owner must decommission all 
facilities, projects, cables, pipelines, and obstructions on their 
lease. BOEM and BSEE disagree that these requirements are unclear or 
that bonds are not required and have not made any changes due to these 
comments.
    Comment: Multiple comments were submitted both supporting and 
opposing the proposed amendments to allow staged funding of 
decommissioning accounts. Several commenters stated that current 
decommissioning requirements place an undue burden on the lessee, while 
the proposed staged funding reduces the burden on developers while 
continuing to protect taxpayers. Several commenters generally supported 
staged decommissioning but stated that BOEM should monitor the approach 
to ensure its assumptions hold true, and that risks to taxpayers remain 
low. Another commenter expressed support for staged decommissioning 
funding and suggested BOEM should schedule the funding to begin toward 
the end of the revenue contract term, stating that ``[d]uring the life 
of the revenue contract a project will have substantial guarantee of 
cashflow and solvency which make funding decommissioning in a lump sum 
premature.''
    In contrast, several commenters were concerned that staged 
decommissioning could result in situations where the account may be 
unable to cover early decommissioning costs in the event of unforeseen 
circumstances (e.g., extreme weather, lawsuits, etc.), bankruptcy, or 
at the conclusion of the lease. Commenters expressed concern that if a 
company were to go out of business (i.e., the developer files for 
bankruptcy prior to the end of the lease term) without providing 
decommissioning costs upfront, the decommissioning account may not be 
fully funded.
    In the NPRM, BOEM also identified differences that reduce the 
decommissioning account risk for renewable energy projects compared to 
oil and gas projects. In response to those differences, one commenter 
said the history of OSW suggests a decreasing level of power generation 
over time, another said production could be unreliable due to changing 
weather and wind conditions, and another said the expected turbine life 
is uncertain and that ``manufacturers do not warrant the turbines for a 
30-year life.'' This risk of variable or even under-performance could 
lead to reduced project revenue.
    Response: BOEM seeks to balance offshore development while 
protecting taxpayers by requiring financial assurance when there is a 
greater risk. BOEM is finalizing the proposed provisions, which will 
provide flexibility for lessees to fulfill their obligations while 
ensuring that U.S. taxpayers are protected and lease obligations 
completely fulfilled. BOEM's proposed approach seeks to target risk 
without being overly burdensome. BOEM can adjust the amount and timing 
of required financial assurance as it continues to monitor a lessee's 
financial health.
    Regarding hurricanes and other weather risks, these have been 
incorporated into the most recent recommended practice for North 
American offshore wind turbines (Offshore Compliance Recommended 
Practices: 2022 Edition (OCRP-1-2022)). In addition to the updated 
design practices, projects may also have insurance, warranties, and/or 
performance guarantees that mitigate the risk of unforeseen 
circumstances. In the event of a turbine needing to be decommissioned 
in an unforeseen event, BOEM's financial assurance policies would 
ensure that insurance or some other type of coverage would provide 
funding for decommissioning or that significant revenue potential still 
exists on the lease so that a lessee would be incentivized to repair or 
replace the damaged turbine to continue operations.
    Comment: A commenter expressed concern that if a company were to go 
out of business (i.e., the developer file for bankruptcy prior to the 
end of the lease term) without providing decommissioning costs upfront, 
the decommissioning account may not be fully funded. A few commenters 
said this could result in decommissioning costs falling to taxpayers or 
ratepayers. Some commenters urged BOEM to require full decommissioning 
funds before construction begins. A commenter encouraged BOEM to 
consider a requirement to fully fund decommissioning at an earlier 
stage in the project life, particularly because this scenario could 
cause safety issues for mariners. For example, ``[o]ne fisherman in 
California discussed that on the West Coast most activities are bottom 
fishing activities, requiring the use of trawling and other equipment. 
As a result, when developers drape cables and transmission lines on the 
ocean floor, these fishermen cannot fish at all so long as the 
equipment is in the water. If developers were to simply cut these lines 
and leave them at the bottom of the ocean floor, this would pose a 
safety hazard to these fishermen.'' The commenter recommended that 
``BOEM revisit the incremental funding model and instead ensure that 
developers have adequate funds to decommission a structure when the 
structure is introduced into the ocean. This will give other small 
business ocean users certainty that the developer will have the ability 
to remove the structure if and when it becomes necessary to do so.''
    Response: BOEM will regularly monitor incremental funding of the 
decommissioning account. If BOEM determines that the amounts have 
changed or the funding needs to be completed sooner, BOEM reserves the 
right to update the funding amount and schedule. The proposed 
amendments seek to balance encouraging development while protecting 
taxpayers by requiring financial assurance when there is a greater 
risk. BOEM is finalizing the proposed provisions which will provide 
flexibility for lessees to fulfill their obligations.
    Comment: A commenter asked BOEM to explain its process should a 
facility require decommissioning due to unforeseen circumstances when 
financial assurances for decommissioning do not cover the actual cost.
    Response: BOEM would seek performance of decommissioning by the 
current lessee(s) under the applicable regulations. Lessee(s) are still 
liable for decommissioning regardless of the status of financial 
assurance, and BOEM evaluates the financial strength of lessees on a 
continual basis.
    Comment: In response to BOEM's discussion of differences between 
the renewable energy sector and the oil and gas sector, a commenter 
said the history of OSW does not suggest a consistent level of power 
would be generated over time, rather a reduction of perhaps 4.5 percent 
per year is more realistic. Additionally, the commenter stated that 
``no one knows what a reasonable lifetime for these turbines will be--
the manufacturers do not warrant the turbines for a 30-year life . . . 
if the capacity is reduced due to operational difficulties, so will be 
the revenue collected.'' Another commenter said that BOEM should 
recognize that OSW production is unreliable due to unreliable weather 
and wind conditions, so developers cannot guarantee consistent 
revenues. The commenter cited multiple years where OSW farms in Europe 
faced ``wind-droughts.'' The commenter also stated that PPA's are only 
a reliable revenue source when developers are able to

[[Page 42637]]

deliver power. Similarly, another commenter discussed current power 
purchase agreements that developers want to re-negotiate due to 
unforeseen increases in project costs that make current rates 
economically unfeasible. The commenter asked how developers operating 
at a loss could accurately predict decommissioning costs.
    Response: BOEM will consider the operational experience and 
profitability of each project when assessing the need for financial 
assurance. This evaluation will occur at least annually, which will 
allow for performance reduction and weather variations to be 
considered. BOEM acknowledges several PPAs are being re-negotiated due 
to increases in project costs, but those costs are mainly related to 
construction and installation, not operations. Once a project is 
operational, the revenues are expected to exceed the operational costs, 
even with the current PPA price levels.
    Comment: A commenter stated that ``with developers already alleging 
that projects will suffer losses at currently contracted rates'' it is 
not likely that ``if a lessee became insolvent during its commercial 
operations period, it would likely be able to transfer a functioning 
OCS renewable energy facility to a solvent entity because the revenues 
would be expected to exceed operating costs.'' Additionally, they 
stated that ``[t]he US taxpayer should not be responsible for the 
shortfalls of OSW companies, nor should the US commercial fishing 
industry suffer the consequences if funds fall short of removing all 
project components.''
    Response: BOEM acknowledges several PPAs are being re-negotiated 
due to increases in project costs and notes that these negotiations are 
occurring prior to construction and installation. Once a project is 
installed and operational, the revenues are expected to exceed the 
operational costs, even with the current PPA price levels. If a lessee 
became insolvent during commercial operations, the project itself could 
still be profitable, therefore, BOEM considers it likely that another 
entity would purchase it and continue its operations. BOEM seeks to 
protect the taxpayer from any costs associated with offshore 
development and will conduct at a minimum, an annual financial review 
of lessees and offshore projects to ensure the continued financial 
strength and economic viability.
    (e) Sec.  585.527 Other financial assurance provisions--credit 
ratings.
    Comment: One commenter said a credit rating from a nationally 
recognized statistical rating organization (NRSRO) would be more 
reliable than BOEM's current assessment of financial strength. Another 
commenter supported the use of public and proxy credit ratings to 
determine the need for financial assurance, and investment grade credit 
ratings to meet financial assurance requirements. One commenter 
preferred the use of NRSRO credit ratings, which are determined on a 
forward-looking basis opposed to the current backward-looking 
assessment.
    A commenter stated that the viability of switching to an external 
credit rating depends on the number and source of ratings. 
Additionally, the commenter said that BOEM must consider the minimum 
acceptable rating and the impacts of a downgrade. A commenter stated 
that a minimum credit rating should not be the only method for 
financial assurance. The commenter suggested that BOEM maintain a 
flexible approach for financial assurance through a combination of 
credit ratings review and other factors, such as audited financial 
statements.
    Response: BOEM is requiring an investment grade credit rating from 
an NRSRO (Sec.  585.527(a)) or an equivalent proxy credit rating 
determined by BOEM using a credit model (Sec.  585.527(b)). A downgrade 
in credit rating or proxy credit rating would require the lessee to 
provide a separate form of financial assurance for the lease and result 
in financial assurance demands to cover the cost of decommissioning. 
BOEM's use of NRSRO credit ratings and proxy credit ratings is a 
flexible approach and incorporates other factors such as audited 
financial statements.
    Comment: A commenter preferred the use of NSRSO credit ratings on a 
forward-looking basis as opposed to the current backwards-looking 
assessment, but noted the approach has limitations. The commenter said 
BOEM should not act as a proxy to the rating agencies, because BOEM has 
a conflict of interest and lacks the necessary expertise. Additionally, 
the commenter asked how BOEM would respond to material changes in a 
guarantor's financial situation.
    Response: When a proxy credit rating is needed, BOEM will use a 
credit model that considers the same factors as a credit rating issued 
by an NRSRO. If material changes cause a guarantor to fall below an 
investment grade credit rating, the lessee would need to provide a 
separate form of financial assurance for the lease.
    (f) Sec.  585.527 Other financial assurance provisions--joint and 
several liability.
    Comment: Multiple commenters said joint and several liability 
should be an additional support if all current owners' default, not a 
substitute or basis for reducing financial assurance requirements for 
current owners. Another commenter expressed concern that basing the 
need for, and amount of, financial assurance amounts on the financial 
strength of co-lessees would undermine the security provided by joint 
and several liability. A separate commenter requested that the final 
rule ``require BOEM to use existing financial security (where BOEM is 
the beneficiary) before looking to predecessors to meet the obligations 
of a current owner in default . . . [and] require that predecessor 
lessees and grantees be named as beneficiaries on security (``dual 
obligee'' security) so that predecessors can use the security to 
satisfy the current owner's obligations in the case of their default.''
    Response: BOEM will not explicitly consider predecessor financial 
strength to meet the financial assurance requirements. Current co-owner 
financial strength will be considered since those entities would also 
have joint and several liability for any obligations. BOEM is 
finalizing, as proposed, that the financial health of lessees with 
retained joint and several liability will not be evaluated when 
determining a current lessee's financial responsibility. Dual-obligee 
specific policies were not considered in the proposed rule; therefore, 
no changes will be made to the final rule. BOEM plans to utilize any 
existing financial security from current lessees in the event of a 
default. There is no requirement that a predecessor be named as a 
beneficiary although BOEM notes that a current lessee could make that a 
condition of any sale or transfer.
3. What is the Department finalizing?
    (a) Sec.  585.516 What are the financial assurance requirements for 
each stage of my commercial lease?
    BOEM is finalizing these regulations as proposed and will require 
financial assurance prior to facility installation instead of at COP 
approval. The updated regulations reflect that BOEM's financial 
assurance requirements are intended to accrue on a timeline that 
matches the increases in a project's liabilities.
    (b) Sec.  585.520 What financial assurance must I provide when I 
obtain my limited lease, ROW grant, or RUE grant?
    BOEM is finalizing the revisions to lease-specific financial 
assurance amounts as proposed. The updated calculation method will 
better align the amount of financial assurance required with the 
potential liability.

[[Page 42638]]

    (c) Sec.  585.521 Do my financial assurance requirements change as 
activities progress on my limited lease or grant?
    BOEM is finalizing the revisions to lease-specific financial 
assurance amounts as proposed. The updated calculation method will 
better align the amount of financial assurance required with the 
potential liability.
    (d) Sec.  585.526 What instruments other than a surety bond may I 
use to meet the financial assurance requirement?
    BOEM is finalizing this section as proposed, which will provide 
flexibility for lessees to fulfill their obligations. BOEM will 
continue to require that all types of financial assurance instruments 
provide adequate coverage matched with the lease and/or grant 
obligations.
    (e) Sec.  585.528 May I use a third-party guaranty to meet the 
financial assurance requirement for lease or grant activities?
    BOEM is finalizing this section as proposed, except as changed by 
the Reorganization Rule. Also as discussed in the NPRM preamble at 88 
FR 5988, the amendments as proposed would grant BOEM the discretion to 
approve a third-party guaranty to cover only a specific amount. BOEM is 
finalizing these amendments as well.
    (f) Sec.  585.529 Can I use a lease- or grant-specific 
decommissioning account to meet the financial assurance requirements 
related to decommissioning?
    BOEM is finalizing the proposed revisions to allow decommissioning 
trust accounts to be incrementally funded pursuant to a BOEM-approved 
schedule, while reserving the right to modify the amount of financial 
assurance if circumstances change. BOEM's approach seeks to reduce risk 
without being overly burdensome and to treat offshore lessees fairly, 
equitably, and with transparency, while also recognizing that offshore 
lessees and projects are not identical. BOEM will regularly monitor 
each lessee's financial health and can adjust the amount and timing of 
required financial assurance as needed.
    In response to comments regarding the potential for U.S. taxpayers 
being forced to pay for decommissioning due to bankruptcies and/or 
other unforeseen circumstances, BOEM seeks to maintain a balance 
between protecting the taxpayer from costs associated with development 
on the OCS and not being overly burdensome. BOEM acknowledges there are 
risks to offshore renewable energy projects and that some of these 
risks are similar to offshore oil and gas while others are distinct. 
For both types of projects, BOEM reserves the right to require 
financial assurance at any point, should it be deemed necessary, and 
actively monitors risks associated with all offshore development. This 
approach allows BOEM to take project-specific conditions into account 
when determining what kind of decommissioning account is appropriate 
for a particular project. BOEM may, for example, consider the duration 
of executed PPAs or offshore renewable energy credits, and require that 
a decommissioning account be fully funded before the expiration of such 
benefits.
    (g) Sec.  585.527 May I demonstrate financial strength and 
reliability to meet the financial assurance requirement for lease or 
grant activities?
    BOEM has finalized the use of credit ratings issued by an NRSRO in 
the final rule based upon its determination that an investment grade 
credit rating or equivalent proxy credit rating provides BOEM 
sufficient protection. BOEM is also requiring third-party guarantors to 
meet the same investment grade rating requirements to provide a third-
party guaranty. Material changes in a lessee's or guarantor's financial 
situation that cause the entity to fall below an investment grade 
credit rating or proxy credit rating will require them to provide BOEM 
with alternative financial assurance.
    BOEM will also evaluate financial strength requirements based on 
the financial strength and reliability of the current lessee(s), even 
if there is a predecessor that is jointly and severally liable. The 
majority of comments on this concept were in support of this approach.

H. Sec. Sec.  285.810-285.812 Safety Management Systems (SMS)

1. What did the Department propose?
    (a) Clarifying safety management system regulations (Sec. Sec.  
285.810-285.812).
    The proposed rule would clarify the information requirements for 
safety management systems (SMS). It proposed to add a provision to 
incentivize lessees and grantees to obtain a safety management 
certification from recognized accreditation organizations to reduce the 
frequency and intensity of regulatory oversight activities. It would 
clarify the scope of work that requires a functioning safety management 
system and added two safety reporting requirements. The Department 
would be able to request the certification report from the accredited 
organization in lieu of requiring additional audits.
    Existing regulations require a lessee to conduct its operations 
safely and to provide BOEM a description of its SMS, usually at the COP 
stage. The proposed changes to Sec. Sec.  585.810 and 285.810 were 
intended to clarify that a lessee or grantee must use an SMS when 
conducting any activity pursuant to a lease or grant, even prior to SMS 
submission to the Department, and would specify the contents of an SMS. 
The proposed rule would require lessees or grantees to submit their SMS 
to the Department with their COP, for SAP- and GAP-approved facilities, 
and activities that the Department deems to be complex and significant. 
The proposed SMS contents are consistent with industry standard safety 
practices and with the guidance BSEE currently provides lessees and 
grantees. Therefore, the Department does not expect these proposed SMS 
changes to increase the burden of compliance on lessees and grantees.
    (b) Why the Existing Regulations Should Be Updated.
    OCS wind lessees and contractors have informally asked the 
Department to clarify its expectations regarding SMS standards. The 
rule would address those inquiries, incentivize SMS certification from 
a recognized accreditation organization, add two safety reporting 
requirements, and clarify that lessees and grantees would be required 
to have and use an SMS for all OCS activities undertaken pursuant to a 
lease or grant from site assessment through decommissioning.
    The Department would implement a performance-based approach that 
would promote flexibility in determining the best way to ensure the 
safety of personnel on and near OCS renewable energy facilities during 
activities covered by the SMS. The SMS changes are consistent with 
industry's safety management best practices. The rule would allow a 
lessee or grantee to adopt U.S. and international workplace health and 
safety standards as its SMS framework.
    Upon SMS receipt, the Department would engage with the lessee or 
grantee to understand what risks the safety system is designed to 
mitigate and how the system would function. The rule would provide 
transparency regarding the types of information that the Department 
considers necessary in a satisfactory SMS and would clarify that the 
Department expects the lessee or grantee to design, implement, and 
maintain the SMS according to generally accepted standard practices 
such as those in API RP 75 (4th ed.), American National Standards 
Institute (ANSI), Z10, and ISO 45001.

[[Page 42639]]

Clarification of necessary SMS information would help prospective OCS 
renewable energy developers understand the Department's SMS 
expectations.
    The rule would add two reporting requirements. One report would 
require an annual summary of how the SMS performed, normalized to work 
hours and energy generation. This report would allow the Department to 
verify SMS functionality and track continual improvements. The second 
would be a triannual report summarizing the results of the most recent 
SMS audit, the corrective actions implemented, and a description of any 
changes made to the SMS since the prior report. Data from these reports 
could be used to generate annual industry-wide comparisons of safety 
performance.
    Finally, the rule would provide that a lessee must have a 
functional SMS before beginning any activity on the OCS pursuant to a 
lease, and must use its SMS for all such activities, including site 
assessment work. This would clarify the Department's expectations 
regarding the stages at which an SMS must be functional and used, 
including prior to the SAP, COP, or GAP.
    SMS engagement with the lessee or grantees will focus on risk 
identification and how the safety system is designed to reduce or 
mitigate those risks to people, property, and the environment. The 
proposed rule would define what the Department considers necessary in a 
satisfactory SMS and would clarify that the Department expects the 
lessee or grantee to design, implement, and maintain the SMS according 
to accepted standard practices. A lessee or grantee whose SMS has been 
certified would be eligible for streamlined oversight in recognition of 
the increased rigor in the development and implementation of its SMS. 
While such certifications would not be required and cannot guarantee 
streamlined oversight in all instances, the Department anticipates that 
most lessees and grantees would pursue certification as a best 
practice.
2. What are the key public comments?
    Comment: Multiple commenters expressed support for the proposed 
shift to performance-based approaches for SMS, particularly related to 
incentives for obtaining certification or accreditation for SMS, 
streamlined oversight, clearer safety expectations, coordination of 
enforcement within the Department, requirements for more detail to be 
included in the SMS, and reporting requirements to allow comparisons of 
safety industry-wide.
    Response: BSEE supports the continued focus on performance-based 
approach to SMS. BSEE is continually evaluating improvements to the 
performance-based approach that have been integrated into this 
rulemaking and additional improvements may also be considered in future 
rulemakings.
    Comment: A commenter expressed concerns that the proposal could 
reduce the frequency and intensity of regulatory oversight on safety 
issues and requested that the Department share any information related 
to requirements for Contingency Plans for potential catastrophic events 
at OSW development sites.
    Response: Regulatory oversight ensuring the safety of offshore 
workers and responsible environmental stewardship of offshore wind 
activities is a primary focus of BSEE and these SMS regulations reflect 
this focus. Section 285.812(b) provides for ``regular demonstration'' 
that the SMS is used and implemented effectively via annual activity 
reports to BSEE and triannual reports summarizing the lessees or 
grantees most recent SMS audit results, including corrective actions, 
and an updated description of the lessees or grantees SMS highlighting 
changes made since the last submission. With regard to potential 
catastrophic events, BSEE requires the development and functionality of 
Emergency Response Procedures in Sec.  285.810(c) and the proposed 
Sec.  285.812.
    Comment: Several commenters stated that safety programs and 
reports, including information about oil or fluid leaks, should be made 
available to the public. Some commenters remarked that oil or other 
fluid leaks, in particular, must be made available to the public 
immediately, and especially to the fishing industry to avoid 
inadvertent harvesting of product(s) that may be harmful to consume. 
Other commenters asserted that the Department should require an annual 
summary of safety performance data covering all site assessment, 
construction, operations, or decommissioning activities; and a report 
summarizing the results of the most recent SMS audit that describes 
corrective actions and any SMS changes made.
    Response: The U.S. Coast Guard requires oil spill reporting through 
the National Response Center and makes the information available to the 
public at nrc.uscg.mil. BSEE will require safety performance data be 
submitted to BSEE through proposed Sec.  285.812(b)(1). BSEE plans to 
publish combined data on a regular basis.
    Comment: Multiple commenters suggested that the Department clarify 
that the SMS also apply to the safety of mariners, including fishermen, 
within and near an OSW facility. Several commenters requested 
clarification on SMS scope, review, approval, certification standards, 
definitions, submissions, and oversight roles.
    Response: BSEE recognizes the importance of consistent safety 
programs and risk mitigations and their potential impacts to the 
fishing and recreation industries, and how they influence performance-
based regulatory programs. BSEE considers environmental safety to be 
within the scope of an SMS. While the SMS regulations themselves do not 
apply to mariners, including fishermen, the intent of the SMS 
regulations are to ensure the safety of personnel or anyone else near 
or on the facilities.
    Regarding comments seeking clarification on SMS generally, BSEE has 
provided guidance to the industry related to these comments in Safety 
Management System Expectations for Renewable Energy Companies Operating 
on the OCS, which is posted on the BSEE website at https://www.bsee.gov/technical-presentations/ooc-presentation-sms-in-ocs-renewable-projects-may-13. This guidance includes information about 
submissions, frameworks, and reviews.
    Comment: Several commenters stated that the Department should 
protect workers and workers' rights by requiring Labor Peace Agreements 
(LPAs) for operations and maintenance workers as a condition of all 
renewable OSW leases and ensure developer commitments do not 
discriminate or retaliate against workers or contractors who raise 
health and safety concerns. One commenter provided background 
information to show the importance of improving workers' rights, 
stating that in the construction industry alone, union worksites have 
31% fewer health and safety violations. The commenter asserted that 
without Department action, operations and maintenance workers would 
have few protections at either the State or Federal levels.
    Response: While BOEM has jurisdiction over lease terms, BSEE agrees 
that a positive safety culture includes the right to stop unsafe work 
and that retaliation leads to a negative safety culture. To ensure the 
safety of lessees and grantee personnel or anyone else on their 
facilities, Sec.  285.810(a)(5) requires them to submit procedures as 
part of the SMS for personnel or visitors to report unsafe work areas 
or conditions to both the lessee, grantee, or designated operator and 
BSEE. BSEE will verify workers have a means of reporting unsafe working 
conditions. BSEE also offers a means of reporting unsafe working 
conditions via the BSEE

[[Page 42640]]

Safety and Incident Investigations Division (SIID) Hotline: (877) 440-
0173 or (202) 208-5646. Section 285.813(b)(1) requires lessees to 
provide a written report to BSEE of any injury in which a person is 
unable to return to work or perform their normal duties the following 
day.
    Comment: A commenter discussed a third-party SMS, including 
accreditation and upcoming revisions to a standards document, SEMS API 
RP 75 (4th ed.), and suggested that the Department acknowledge this 
document and recognize the commenter's program for accreditation as 
suitable for SMS certification. Changes the commenter recommended to 
the proposed rule include:
     In proposed Sec.  585.811, include API RP 75 in the 
parenthetical examples of acceptable health and safety standards and 
modify the first sentence such that it reads: ``You are not required to 
obtain a certificate that your SMS meets acceptable health and safety 
standards (e.g., API RP 75, ANSI Z10, ISO 45001) from a recognized 
accreditation organization (e.g., COS, ANAB).''
     In the corresponding preamble, provide supporting 
information in the preamble for proposed Sec. Sec.  585.810 through 
585.812 supporting API RP 75 as an acceptable health and safety 
standard, and recognize COS's accreditation program for ASP and COS's 
SEMS certificate program as suitable for lessees or grantees to receive 
incentives for their SMS.
    Response: BSEE agrees that API RP 75 (4th ed.) is one acceptable 
SMS framework standard and has included it as an example of an 
acceptable standard in Sec.  285.811. This rulemaking does not specify 
any recognized accreditation organization. BSEE has taken a 
performance-based approach and declined to specify standard and 
accreditation organizations at this point in time. The process 
implemented here provides flexibility to both the lessee and BSEE.
    Comment: Several commenters provided editorial revisions to the 
language in the proposed rule related to shut-downs, new language to 
define the contents of as-built submissions, and details included in 
SMS descriptions in plans. One such example revises certain language in 
Sec.  585.810(b)(5) from ``shut-down of one or more facilities'' to 
``manual shut-down of one or more facilities for the preservation of 
safety.''
    Response: BSEE agrees that all conditions might not be available 
while the COP is still in the approval process and that it will change 
over time as the program matures. The objective of this requirement is 
that lessees demonstrate an awareness of conditions that could lead to 
a shutdown of one of more facilities and that they have in place 
specific measures to control or mitigate risks. BSEE supports the 
continued focus on performance-based approaches to Safety Management 
Systems. BSEE is declining to update the regulations regarding as-
builts in this final rule. BSEE may issue an NTL to clarify the as-
built requirements or update the regulations in the future should 
additional requirements be necessary. BSEE is declining to change the 
language proposed limiting shutdown of facilities to only manual 
shutdowns. Other types of shutdowns are critical for safety and should 
be included in the SMS.
3. What is the Department finalizing?
    (a) Sec.  285.810 When must I submit a Safety Management System 
(SMS) and what must I include in my SMS?
    The Department is finalizing this section, consistent with proposed 
Sec.  585.810, with minor revisions. For added clarity, BSEE is 
including items required in the SMS under paragraphs (a) through (f). 
Additionally, BSEE is revising the language in paragraph (a)(1) to 
clarify that the health and safety risk provisions in this paragraph 
also apply to anyone ``engaged in lease activities.'' In paragraph 
(a)(3), BSEE is clarifying that nationally or internationally 
recognized standards are applicable to ensure the safety of the 
activities covered by the SMS. BSEE is also making minor edits to this 
section to apply the transfer of authority from BOEM to BSEE and make 
corresponding corrections to regulation references.
    Lessees and grantees are required to use a SMS for activities 
conducted on the OCS to develop or operate a lease, from met buoy 
placement and site assessment work through decommissioning, and to 
provide the SMS to BSEE upon request. They must also submit a detailed 
description of the SMS with their COP (as provided under Sec.  
285.627(d)) and, when required, with their SAP (as provided in Sec.  
285.614(b)) or GAP (as provided in Sec.  285.651).
    An acceptable SMS must address how the lessee or grantee will 
ensure the safety of their personnel or anyone else on their facilities 
or engaged in lease activities, specific policies and strategies to 
control risks, and methods that will be used to monitor the 
implementation of the SMS and maintain the safety of activities covered 
by the SMS, including management of change and stop work practices; and 
procedures for personnel to report unsafe work conditions both to the 
lessee, grantee, or their designated operator and to BSEE.
    Additional SMS elements include remote monitoring, control, and 
shutdown capabilities; emergency response procedures, fire suppression 
equipment and how and when it will be used, as needed; how and when the 
lessee or grantee will test its SMS; auditing of the SMS; testing of 
critical SMS components including remote shutdown capabilities as well 
as emergency response readiness; and required training for personnel 
who conduct activities on the facilities and provision of knowledge and 
skills to ensure that personnel perform duties safely for the duration 
of activities.
    (b) Sec.  285.811 Am I required to obtain a certification of my 
SMS?
    The Department is finalizing this regulation, consistent with 
proposed Sec.  585.811. BSEE is revising this regulation to update the 
transfer of authority from BOEM to BSEE for considering certifications 
in determining the frequency and scope of SMS-related inspections under 
this subpart, as well as the scope and nature of its oversight over any 
audit-induced corrective actions. The final rule revises the list of 
examples of acceptable health and safety standards to also include API 
RP 75.
    BSEE encourages lessees and grantees to obtain a certification for 
their SMS to meet acceptable health and safety standards from a 
recognized accreditation organization (e.g., ANSI Z10, API RP 75, ISO 
45001). However, lessees and grantees are not required to obtain a 
certification from such organizations. BSEE will nonetheless consider 
such certification in determining the frequency and scope of SMS-
related inspections that it conducts under this subpart, as well as the 
scope and nature of its oversight over any audit-induced corrective 
actions.
    (c) Sec.  285.812 How must I implement my SMS?
    The Department is finalizing this regulation, consistent with 
proposed Sec.  585.812.
    This section requires that a lessee's or grant holder's SMS must be 
functional before they begin and must remain functional while they 
perform any activity on the OCS, from met buoy placement and site 
assessment work to decommissioning, or for any activities described in 
their approved SAP, COP, or GAP. Lessees and grant holders must 
regularly demonstrate to BSEE that their SMS is being implemented 
effectively by submitting annual and triennial reports to BSEE in 
accordance with Sec.  285.110.

[[Page 42641]]

I. Inspections

1. What did the Department propose?
    Existing regulations state that the Department, acting through BOEM 
and BSEE, as applicable, will inspect facilities and vessels engaged in 
renewable energy activities to verify compliance with applicable terms, 
conditions, laws, and regulations, and to determine whether safety 
equipment has been properly installed and operated. The existing 
regulations that require the lessee to conduct self-inspections are 
limited to inspections of structures, mooring systems, and monitoring 
of corrosion protection. Changes in the proposed rule would expand the 
scope of Department inspections to cover Critical Safety Systems and 
Equipment.
    (a) Why the Existing Regulations Should Be Updated.
    OCSLA requires the Department to promulgate regulations to provide 
for scheduled onsite inspection, at least once a year, of each facility 
on the OCS (43 U.S.C. 1348(c)). Existing Department regulations require 
BSEE to perform a scheduled onsite inspection of all renewable energy 
facilities on the OCS and inspect all safety equipment designed to 
prevent or ameliorate fires, spills, or other major accidents.
    To ensure that the OCSLA mandate of an annual onsite inspection is 
met, the Department is revising Sec.  285.824 to require the lessee to 
conduct annual onsite self-inspections. The lessee would also be 
required to maintain records of its self-inspections and to provide 
these records to the Department upon request pursuant to Sec.  285.824. 
This would make the lessee accountable for ensuring safety and 
protection of the environment. In addition, the Department would retain 
the ability to conduct inspections at any time.
    This revision would allow the Department to focus resources on 
conducting inspections, both scheduled and unscheduled, based on 
criteria such as operational risk severity and probability, results of 
the lessee required annual self-inspections, industry trends, incident 
data, analytical data, safety management system implementation and 
audits, and other observations. Collectively, these inputs provide 
compliance-based, risk-based, and performance-based data that will 
enable BSEE to tailor inspection scope, protocol, location, and 
frequency leading to high value-added BSEE inspections of facilities, 
vessels, and renewable energy operations.
    This revision would also reduce logistical and human resource 
burdens on the lessees by allowing them to schedule their annual self-
inspections with maximum efficiency by incorporating the inspections 
into scheduled onsite activities.
2. What are the key public comments?
    (a) Self-Inspection Requirements.
    Comment: Several commenters stated that more clarity is needed 
regarding which vessels would be subject to Department inspections; the 
roles of BOEM, BSEE, USCG, and independent inspection companies 
contracted by lessees to conduct inspections; the intensity and focus 
of inspections; and how inspections would address operational safety, 
environmental risk, and engineering.
    Response: BSEE-led inspections are limited to vessels conducting 
lease activities in Federal waters that occur either on the lease or an 
associated easement. Both BSEE-led inspections and self-inspections 
will focus on ensuring that lease activities are being conducted in 
compliance with the regulations, which are written to provide 
protections to human safety and the environment. As described above, 
BSEE's analysis of compliance, risk, and performance data will enable 
it to tailor its scheduled and unscheduled inspections, including 
utilization of remote inspections, remote testing, witnessing, and 
review of self-inspection, allowing for comprehensive oversight.
    Comment: Approximately 20 commenters discussed self-inspection 
requirements. Multiple commenters supported the proposal to allow 
lessees to conduct self-inspections. One commenter remarked that 
existing regulations limit self-inspections to structures, mooring 
systems, and monitoring of corrosion protection. The commenter noted 
that shifting inspection responsibility to the lessee would allow for 
the Department to focus its resources on conducting inspections based 
on designated criteria while reducing logistical and human resource 
burdens on lessees.
    Response: BSEE is committed to a performance-based inspection 
framework that is tailored to the operation, developer, location, and 
associated risk. BSEE agrees that self-inspections allow the Department 
to better use limited resources and create operational efficiencies.
    Comment: Multiple commenters opposed the proposal to allow lessees 
to conduct self-inspections, asserting that this could lead to safety 
and environmental impact issues as the lessees would be primarily 
responsible for conducting inspections, rather than BOEM and BSEE. The 
commenters suggested that the agencies increase oversight, including 
mandating inspections and self-inspections, providing public access to 
report findings, and enforcing appropriate repercussions if lessees 
fail to comply.
    Response: BSEE is mandating self-inspections and will oversee the 
self-inspection process. BSEE has determined that using compliance, 
risk, and performance-based data to prioritize onsite BSEE inspection 
frequency, remote inspections, remote testing witnessing, and review of 
self-inspection will be more effective than BSEE onsite inspections 
alone and will allow for more comprehensive oversight. Allowing self-
inspection to occur during maintenance visits reduces personnel risk 
exposure and facility downtime. BSEE has determined that its inspection 
approach will allow for proactive identification of hazardous 
condition.
    BSEE currently releases performance statistics on the BSEE website 
(at https://www.bsee.gov/reporting-and-prevention/safety-and-environmental-management-systems) which track trends and provides 
incidents analysis and safety and health performance for Oil and Gas 
Operations from performance data gathered by BSEE as required under 30 
CFR 250.1929. BSEE plans to release similar information for renewable 
energy facilities based on the performance data collected under Sec.  
285.812. Section 285.812 requires that key safety and operational 
statistics are captured by the lessees and reported to BSEE. BSEE uses 
this information to calculate a variety of annual, OCS-wide, 
performance indices and to track industry performance. These indices 
calculated by BSEE allow lessees to benchmark their performance against 
aggregate industry data, as well for BSEE to provide the public with 
OCS performance trends information.
    Comment: Multiple commenters suggested that the Department should 
consider remote condition monitoring using technology in conjunction 
with targeted inspections to reduce the burden of yearly physical 
inspections or should allow lessees to conduct less frequent 
inspections coordinated with routine maintenance activities. Multiple 
commenters provided revised text to include in the final rule 
reflecting these changes. A commenter suggested that the Department 
should allow lessees to provide justification for a self-inspection 
period greater than one year.
    Response: OCSLA requires an annual onsite inspection of all safety 
equipment designed to prevent or ameliorate fires, spillages, or other 
major accidents. Accordingly, BSEE lacks authority to

[[Page 42642]]

increase the time between inspections beyond one year. BSEE supports 
the use of remote condition monitoring by lessees to inform their 
productivity and compliance efforts. BSEE's inspection program 
considers compliance, risk, and performance-based data, which may be 
collected by remote monitoring technology, as well as the prescriptive 
annual onsite inspection as required by the OCSLA.
    Comment: A commenter suggested that the Department provide more 
information on the efficacy of self-inspections in relation to 
operational safety. A commenter stated that the Department should 
provide clarity on what should be included in a comprehensive self-
inspection plan. The commenter remarked that the scope of self-
inspections is expanded in the proposed rule to include ``all safety 
equipment designed to prevent or ameliorate fires, spillages, or other 
major accidents,'' however, this phrase is not illustrated or explained 
in the preamble to the rule. Further, under the proposed rule, a self-
inspection ``must include, but is not limited to,'' all such safety 
equipment.
    Response: BSEE has explained in 30 CFR 285.824 what the self-
inspection plans must include. BSEE is requiring that the self-
inspection plan development include risk-based evaluation and 
identification of equipment designed to prevent or ameliorate fires, 
spillages, or other major accidents. Requiring lessees to identify this 
equipment, which is now defined as ``Critical Safety Systems and 
Equipment'' in 30 CFR 285.112, allows for the regulatory requirements 
to remain adaptive to new and emerging technologies. The ``but is not 
limited to'' language allows lessees to add any equipment they deem 
important to the self-inspection plan even if it may not meet the 
definition of Critical Safety Systems and Equipment.
    Comment: Some commenters stated that while they welcome SMS 
certification from an accredited safety and environmental Conformity 
Assessment Body (CAB), the Department should not rely on such third-
party certifications for assurance of SMS compliance in lieu of direct 
inspection by the agencies. If BSEE does permit self-inspection, third-
party SMS certification from safety and environmental CABs should be 
required, and the third-party inspection reports should be attested to, 
filed with the agency, and made accessible to the public on the 
agency's website.
    Response: BSEE does not rely solely on third-party certifications 
for assurance of SMS compliance, nor does it rely solely on self-
inspections for assurance of operational regulatory compliance. A 
lessee SMS certification will be considered by BSEE during its 
inspection data analysis, but it does not eliminate BSEE's ability to 
conduct direct inspections. BSEE intends to publish combined data on 
its website on a regular basis. BSEE is not requiring third-party SMS 
certification, but third-party certification is encouraged. BSEE has 
multiple ways to conduct safety oversight of projects, including self-
inspections, BSEE direct inspections, SMS third-party audits, BSEE led 
SMS reviews, and remote inspections. BSEE has determined that utilizing 
a performance-based approach to inspection frequency will be more 
effective and allow for more comprehensive oversight. BSEE has 
determined that the performance-based approach will allow for proactive 
identification of hazardous conditions.
    (b) Other Comments on Inspections.
    Comment: Several commenters suggested that the Department provide 
more clarity on the definition of ``facility,'' (e.g., single turbines 
or the whole of the site layout offshore), the level and type of 
inspections needed (consider allowing an independent inspection company 
to perform work on behalf of a lessee), and the possibility of remote 
inspections to reduce emissions and the overall exposure of industry 
and agency personnel offshore.
    Response: BSEE defines ``facility'' in Sec.  285.122 as an 
installation that is permanently or temporarily attached to the seabed 
of the OCS. Facilities include any structures; devices; appurtenances; 
gathering, transmission, and distribution cables; pipelines; and 
permanently moored vessels. Any group of OCS installations 
interconnected with walkways, or any group of installations that 
includes a central or primary installation with one or more satellite 
or secondary installations, is often designed as a single facility. 
BSEE may decide that the complexity of the installations justifies 
their classification as separate facilities.
    BSEE's inspection model includes the option of remote monitoring 
technology as well as the prescriptive annual onsite inspection 
required by the OCSLA. As performance-based inspection by lessees and 
operators using remote inspection technology is found to be successful 
in reducing risks to industry personnel, BSEE may consider future 
changes to inspection activities.
    Comment: A commenter stated that while the preamble language 
discussing the proposed rules appears to indicate that the Department 
would continue to conduct regular inspections, as written the proposed 
rules do not require the Department to do so. The commenter recommended 
that the Department's regulations provide some minimum frequency for 
conducting onsite inspections to ensure adequate oversight of OCS 
facilities.
    Response: OCSLA requires an annual onsite inspection of all safety 
equipment designed to prevent or ameliorate fires, spillages, or other 
major incidents. BSEE's inspection model may include remote monitoring 
technology as well as requiring the lessee to perform the prescriptive 
annual onsite inspection as required by the OCSLA. The results of those 
and other additional mandated inspections will be evaluated along with 
lessee's performance record to determine the frequency of onsite 
inspections by BSEE personnel. BSEE has determined that prescribing a 
minimum frequency for BSEE inspections is not necessary at this time. 
BSEE will use compliance, risk, and performance-based data to remain 
adaptive as the renewable energy industry matures.
3. What is the Department finalizing?
    (a) Sec.  285.820 Will BSEE conduct inspections?
    This regulation was revised to state that BSEE may inspect OCS 
facilities and any vessels engaged in activities authorized under this 
part.
    (b) Sec.  285.821 Will BSEE conduct scheduled and unscheduled 
inspections?
    BSEE is finalizing this section as proposed in the NPRM. BSEE may 
conduct both scheduled and unscheduled inspections.
    (c) Sec.  285.822 What must I do when BSEE conducts an inspection?
    BSEE is finalizing this section as proposed in the NPRM. When BSEE 
conducts an inspection, you must provide access to all facilities on 
your lease (including your project easement) or grant, and any vessels 
engaged in activities authorized under this part.
    (d) Sec.  285.824 How must I conduct self-inspections?
    BSEE is finalizing this section as proposed in the NPRM with small 
modifications from the NPRM. As proposed in the NPRM, Sec.  285.824 
requires the lessee to develop a comprehensive self-inspection plan 
covering all of their facilities. The lessee must keep a copy of their 
self-inspection plan wherever they keep their records and make it 
available to BSEE upon request. This self-inspection plan must specify 
how they will fulfill the requirement for an annual onsite inspection 
of all Critical Safety Systems and Equipment.

[[Page 42643]]

    The regulation also now requires lessees to conduct an onsite 
inspection of each of their facilities at least once a year as proposed 
in the NPRM. The inspection must include, but is not limited to, all 
Critical Safety Systems and Equipment. The lessee must develop and 
retain summary reports for all such inspections for each calendar year. 
The summary report must note any failures of operability, any required 
maintenance of Critical Safety Systems and Equipment, or required 
replacement of the Critical Safety Systems and Equipment identified 
during inspection. The lessee must also retain records of inspections 
and summary reports for the previous 2 calendar years and make them 
available to BSEE on request.
    Under this section, lessees must include a list of facilities 
inspected for structural condition and corrosion protection in their 
annual reports as proposed in the NPRM.
    (e) Sec.  285.830 What are my incident reporting requirements?
    BSEE is finalizing this section as proposed in the NPRM. BSEE 
requires that you must report all spills of oil or other liquid 
pollutants in accordance with 30 CFR 250.187(d).

J. Other General Comments Related to Part 285

    Comment: A few commenters suggested that the Department consider 
appointing a Health and Safety Committee to provide consistency in 
public access to information and provide input on CVA and engineering 
reports.
    Response: Forming a Health and Safety Committee is outside of the 
scope of this rulemaking. BSEE notes the comment and may take it into 
consideration in the event that BSEE initiates a relevant rulemaking 
process in the future.

K. Other Proposed Changes in Part 585

1. What did the Department propose?
    BOEM proposed additional regulatory changes that did not fall 
within the eight previously discussed categories. Here is a short 
description of those regulatory changes.
    (a) BOEM's responsibilities under OCSLA.
    Sec.  585.102 What are BOEM's responsibilities under this part?
    Section 585.102(a) specifies that BOEM will authorize renewable 
energy activities in accordance with OCSLA subsection 8(p)(4), as 
enumerated in Sec.  585.102(a)(1) through (12). BOEM proposed amending 
this regulation to clarify that none of the enumerated requirements is 
intended to outweigh or supplant any other. The purpose of proposed 
change was to clarify that BOEM takes all of these relevant factors 
into consideration in planning its renewable energy program and that no 
one factor or consideration, by itself, should outweigh the other 
relevant considerations.
    (b) Lease Structure.
    Sec.  585.235 If I have a commercial lease, how long will my lease 
remain in effect?
    BOEM proposed to change the default commercial lease terms in Sec.  
585.235 by merging the existing preliminary and site assessment terms 
into one preliminary period; establishing new lease periods for COP 
review and for design and construction that can vary in length based on 
the duration of the COP review and the design and construction process; 
and converting the existing 25-year operations term that commences at 
COP approval into a 30-year operations period commencing at the 
commercial operations date. These proposed changes recognized that most 
lessees will not submit SAPs, account for the time required for permit 
review and construction, and provide certainty to a lessee regarding 
the operations period of its renewable energy project.
    (c) Lease Segregation and Consolidation.
    The following provisions are discussed under this section.
     Sec.  585.410 When will my assignment result in a 
segregated lease?
     Sec.  585.411 How does an assignment affect the assignor's 
liability?
     Sec.  585.412 How does an assignment affect the assignee's 
liability?
     Sec.  585.413 How do I consolidate leases or grants?
    BOEM has received requests from lessees to segregate single leases 
into multiple leases, held by different subsidiaries, as well as to 
consolidate multiple adjacent leases into a single lease. BOEM 
regulations allow such segregations and consolidations, and the NPRM 
proposed amendments that would expand upon the existing regulations at 
Sec.  585.409 regarding assignments by establishing specific procedures 
for lease segregation and consolidation.
    (d) Civil Penalties.
    Sec.  585.400 What happens if I fail to comply with this part?
    The Department's renewable energy regulations do not explicitly 
provide for assessing immediate civil penalties for violations that 
constitute or constituted a threat of serious, irreparable, or 
immediate harm or damage to life, property, or the marine, coastal, or 
human environment, without notice and an opportunity to correct. 
However, the authority for doing so is set forth in the OCSLA. The NPRM 
proposed amendments to the Department's regulations to ensure that its 
civil penalty regulations are coextensive with its statutory authority.
    (e) Standardize Annual Rental Rates for Grants.
    Sec.  585.508 What rent payments must I pay on ROW grants or RUE 
grants associated with renewable energy projects?
    The NPRM proposed to standardize the annual rental rate for most 
grants. Under the proposed rule, BOEM would apply a $5 per acre annual 
rental rate for both ROWs and RUEs, unless specified otherwise in the 
grant.
    (f) Technical Corrections and Clarifications.
    Finally, the NPRM proposed numerous minor technical changes. These 
technical revisions maintain consistency with proposed changes 
elsewhere in the regulations, clarify ambiguities, correct technical 
errors, and improve organization. Examples of proposed changes in this 
category are discussed in the NPRM at 88 FR 5991.
    The following are the specific sections affected by these changes:
    Sec.  585.103 When may BOEM prescribe or approve departures from 
the regulations in this part?
    The proposed rule clarified that under 30 CFR 585.103(a)(1), 
regulatory departures may be granted when necessary to facilitate 
programmatic activities before, during and after lease termination.
    Sec.  585.107 How do I show that I am qualified to be a lessee or 
grant holder?
    BOEM proposed a technical correction to paragraph (b) to reflect 
that the Immigration and Naturalization Service no longer exists and to 
avoid the need for future technical corrections in the event of another 
change in the name of the relevant Federal immigration authority.
    Sec.  585.110 How do I submit plans, applications, reports, or 
notices required by this part?
    BOEM proposed to eliminate its paper copy requirement and rely 
primarily on electronic submissions. The paper requirement has proven 
unwieldy for voluminous plan submittals that contain multiple 
appendices and may be subject to multiple revisions before they are 
finalized. However, BOEM proposed to reserve the authority to require 
paper copies of certain documents (such as maps and charts) if 
necessary.
    The proposed rule also proposed eliminating the specific BOEM 
mailing address to avoid the need for future

[[Page 42644]]

technical corrections if BOEM's mailing address changes again. Instead, 
the mailing addresses for BOEM submissions would be listed for the 
appropriate contacts on BOEM's website.
    Sec.  585.417 When may BOEM order a suspension?
    BOEM proposed to eliminate the paper copy requirement for this 
regulation, consistent with its proposed changes to Sec.  585.110.
    Sec.  585.607 How do I submit my SAP?
    BOEM proposed to eliminate the paper copy requirement, consistent 
with its proposed changes to Sec.  585.110.
    Sec.  585.622 How do I submit my COP?
    BOEM proposed to eliminate the paper copy requirement, consistent 
with its proposed changes to Sec.  585.110.
    Sec.  585.627 What information and certifications must I submit 
with my COP to assist BOEM in complying with NEPA and other applicable 
laws?
    The proposed rule proposed to eliminate the paper copy requirement 
consistent with BOEM's proposed changes to Sec.  585.110.
    Sec.  585.642 How do I submit my GAP?
    BOEM proposed to eliminate the paper copy requirement for this 
regulation, consistent with its proposed changes to Sec.  585.110.
    Sec.  585.701 What must I include in my Facility Design Report?
    BOEM proposed to eliminate the paper copy requirement for this 
regulation, consistent with its proposed changes to Sec.  585.110.
    Sec.  585.702 What must I include in my Fabrication and 
Installation Report?
    BOEM proposed to eliminate the paper copy requirement for this 
regulation, consistent with its proposed changes to Sec.  585.110.
    Sec.  585.712 What are the CVA's or project engineer's reporting 
requirements?
    BOEM proposed to eliminate the paper copy requirement for this 
regulation, consistent with its proposed changes to Sec.  585.110.
2. What are the key public comments?
    (a) BOEM's responsibilities under OCSLA.
    Comment: A commentor stated that BOEM exceeded its statutory 
authority by making substantive changes to the statutory criteria for 
lease suspension and cancellation. Therefore, the commenter said the 
modernization rule should include regulatory changes to correct 
differences between the current regulatory criteria for lease 
suspension (Sec.  285.417) and cancellation (Sec. Sec.  585.422(b)(4) 
and 285.437(b)(4)) and the statutory (OCSLA) criteria.
    Response: This rulemaking is not proposing to change these 
provisions because we view them as consistent with OCSLA.
    Comment: A commenter expressed support for proposed revisions 
related to the application of the section 8(p)(4) factors in Sec.  
585.102. The commenter suggested that BOEM should provide clarity on 
its approach to ``rationally'' balancing factors. The commenter also 
requested clarification of specific terms and topics related to 
prevention of waste factors, BOEM's compliance with law and 
regulations, environmental benefits of OSW development, and the ability 
of Tribal Nations to hold leases and grants, for consistency with 
referenced opinions, articles, and regulations.
    Response: With regard to Sec.  585.102 language, BOEM agrees that 
clarifying the meaning of ``prevention of waste'' as well as the 
incorporation of balancing into the text of this section provides 
greater understanding of how the 12 factors in this section are 
considered in BOEM's decision-making. The Secretary must consider 
certain factors before approving activities under subsection 8(p). 
Subsection 8(p)(4) of OCSLA requires only that the Secretary strike a 
rational balance between Congress's enumerated goals, i.e., a variety 
of uses of the OCS. In making this determination, the Secretary retains 
wide discretion to weigh those goals as an application of her technical 
expertise and policy judgment. Moreover, the Secretary has the 
authority to define by regulation how the factors in subsection 8(p)(4) 
are to be administered.
    BOEM did not add clarifications about the ability of Tribal Nations 
to hold leases and grants because the regulations are already clear 
that nothing prohibits Tribal entities from participating in BOEM's 
processes as state-chartered tribal corporations.
    Comment: A commenter discussed that subsection 8(p)(4) of OCSLA 
does not require BOEM to ensure that OCSLA's goals are achieved to a 
particular degree, but instead requires that BOEM employ its discretion 
to achieve a balance among the statute's several factors, considering 
Congress's direction to authorize renewable energy development on the 
OCS, leaving ``striking the proper balance . . . up to the Secretary of 
the Interior,'' so long as that balance is rational. The commenter also 
suggested that the final regulatory preamble should acknowledge the 
caselaw supporting BOEM's proposed revision to Sec.  585.102(a), which 
would provide that BOEM will ensure that any activities authorized in 
this part are carried out in a manner that provides for and reaches a 
rational balance among the 12 enumerated factors, none of which 
inherently outweighs or supplants any other.
    Response: The Department agrees that the proposed rule is strongly 
rooted in and supported by Federal case law.\14\ As discussed in the 
preamble, BOEM is amending these regulations to clarify that none of 
the enumerated requirements is intended to outweigh or supplant any 
other. The purpose of this change is to clarify that BOEM takes all of 
these relevant factors into consideration in planning and administering 
its renewable energy program and that no one factor or consideration, 
by itself, should outweigh the other relevant considerations.
---------------------------------------------------------------------------

    \14\ See Commonwealth of Mass. v. Andrus, 594 F.2d 872, 889 (1st 
Cir. 1979) (reading list of general policy priorities in former 
section 3 of OCSLA to mean that ``where . . . sets of interests 
conflict . . . , the Secretary must determine which interests must 
give way, and to what degree, in order to achieve a proper 
balance,'' a task that ``rules out a policy based on sacrificing one 
interest to the other'').
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    (b) Lease Structure.
    Comment: As an alternative to a 30-year default operations period, 
a commenter recommended the lessees be able to specify a duration for 
the operations period for review and approval in the COP. The commenter 
said the lessees must have certainty on extensions before investing in 
facilities with longer lifetimes than the default operations period. 
According to the commenter, the option to request an extension 
following COP approval can be burdensome as it is likely to trigger new 
NEPA reviews if not already part of the original PDE. The commenter 
suggested the following revised language at 585.235(a)(4): ``Operations 
period: A commercial lease has an operations period of 30 years, the 
duration specified in the lease, or the duration included and approved 
as part of your COP.'' Further, the commenter recommended revising 
Sec. Sec.  585.626 through 585.639 to include details on what 
information would be needed in the COP to justify an operational period 
exceeding the default duration. Similarly, another commenter 
recommended adding an option to extend the operating period to match 
the asset's life, which would maximize economic benefit, rather than 
risk retiring projects prematurely.
    Another commenter said, ``585.235(b) could be clearer that an 
extension of the operational period is not necessary if a longer 
duration of operational period is already included and approved in the 
COP.'' The commenter recommended the following revised language at 
Sec.  585.235(b): ``You may request an

[[Page 42645]]

extension of any of the lease periods outlined in paragraph (a) of this 
section for good cause or by including an alternative period in your 
COP.'' Similarly, another commenter recommended the following textual 
revision: ``You may request an extension of any of the lease periods 
outlined in paragraph (a) of this section for good cause [add: 
including if the project is designed and verified for a longer 
duration].'' Given the likelihood of future technological advancements 
and the potential for generating energy beyond 30 years, another 
commenter said the proposed rule should guarantee extension of the 
operations period if certain conditions are met, and BOEM should retain 
the discretion to extend the operations period for good cause even if 
the conditions are not met.
    Response: BOEM agrees with the recommended revision to Sec.  
585.235(a)(4): ``A commercial lease has an operations period of 35 
years; or the duration specified in the lease; or the duration included 
and approved as part of your COP.'' The revised text would facilitate 
efficient technical and environmental reviews that match the 
applicant's goals (reducing the likelihood of requiring future 
supplemental environmental reviews) and the technical review could 
ensure the proposed period is supported by the design life of the 
proposed facilities and/or require conditions to safely extend their 
operations.
    Comment: For consistency, a commenter recommended that section 
585.408 echo the concept laid out in BOEM's proposed paragraph at Sec.  
585.235(d) that would allow the assignee to propose new lease periods. 
The comment suggested adding ``(9) Any request to modify the default 
lease schedule as a result of the assignment'' to the existing list of 
8 pieces of information required for an assignment.
    Response: BOEM agrees with this addition in light of the revisions 
to Sec.  585.235(b) and has added similar language to the rule text at 
Sec.  585.408(a).
    Comment: A commenter stated that the proposed mandatory one-year 
time frame for lessees to resolve issues identified as incomplete 
within their COPs should be revised or removed as it may not be 
feasible to resolve issues in this time, given that BOEM may take 
several months to provide lessees with comments, and resolving issues 
may require surveys, fieldwork, and modeling. Another commenter 
suggested that BOEM establish a timeline for its initial COP review in 
order to allow lessees to make revisions within the one-year time 
frame.
    Response: The proposed rule stated, ``The COP review period begins 
when BOEM receives a COP from the lessee and ends upon COP approval, 
disapproval, or approval with modifications . . . During the COP review 
period, BOEM conducts the necessary reviews and consultations 
associated with the COP. The lessee must resolve issues identified as 
incomplete in the COP by BOEM within the first year of the COP review 
period.'' BOEM recognizes the concerns raised by several commenters 
with the requirement to ``resolve issues identified as incomplete in 
the COP by BOEM within the first year of the COP review period.'' Upon 
further consideration, BOEM is eliminating this provision because it is 
too inflexible to accommodate the potential need for additional survey 
campaigns to be completed. Further the proposed rule was not clear on 
the consequences for failing to resolve issues and the phrasing 
``resolve issues'' in itself is vague. BOEM will rely on its guidance 
when considering whether a COP is ready for the issuance of an NOI and 
BOEM can measure the maturity and completeness of the applications 
before it in accordance its guidance.\15\
---------------------------------------------------------------------------

    \15\ See Information Needed for Issuance of a Notice of Intent 
(NOI) Under the National Environmental Policy Act (NEPA) for a 
Construction and Operations Plan (COP), (Aug. 2023), available at 
https://www.boem.gov/sites/default/files/documents/renewable-energy/state-activities/BOEM%20NOI%20Checklist.pdf.
---------------------------------------------------------------------------

    Comment: A commenter stated that BOEM should allow the sale of 
electricity generated during commissioning and testing and this should 
not trigger the beginning of the lease operation period to avoid 
delayed energy production and to allow the lessee to use the full life 
of the project. Related to Sec.  585.235(a)(4), a commenter recommended 
replacing ``at the start of commercial operations'' with the following, 
``The operations period begins when (i) the final constructed facility 
necessary for production of electricity or other energy product has 
completed installation and commissioning activities, and (ii) BSEE has 
received and non-objected to documentation of critical system safety 
commissioning and your PVR. The operations period will be deemed to 
have started if BOEM reasonably determines that the facilities are 
substantially complete and the PVR is unduly delayed.''
    Response: BOEM and BSEE agree that the transmission and sale of 
electricity generated during commissioning and testing should not 
trigger the beginning of the lease operation period. Section 
585.235(a)(4) has been revised to disconnect the beginning of the 
operations period from the commencement of commercial operations of any 
facility. Instead, the operations period commences when the 
requirements of Sec.  285.637 are met for an entire project area 
through the submission of final reports and records. In addition, BOEM 
ensured the final rule accommodates phased development under Sec.  
585.238 by requiring COPs that incorporate phased development to 
propose lease period schedules under Sec.  585.235(c). This provision 
requires a lessee to propose a lease period schedule for latter 
phase(s) that could include an operations period that does not commence 
when the requirements of 30 CFR 285.637 were only met for the first 
project phase. Consequently, for a phased development COP, each phase 
will have its own lease period schedule that is informed by the 
lessee's request, BOEM's review of the request, and the resulting BOEM-
approved schedule. Consistent with the changes BOEM made to Sec.  
585.235(a)(4) in response to these comments, BOEM also revised the end 
point for the design and construction period at Sec.  585.235(a)(3) 
which immediately precedes the operations period. Instead of ending the 
design and construction period ``either when commercial operations 
begin or at the expiration of the period set forth in the approved COP 
as modified'' the final rule ends the design and construction period 
``when the operations period begins'' as described in Sec.  
585.235(a)(4).
    (c) Lease Segregation and Consolidation.
    Comment: A commenter stated that if lease changes are considered, 
then impacts to risk management and financial assurance must be 
considered for public protection. The commenter also said that the 
potential impact on future licensing must be considered because the 
current EIS process does not permit consideration of alternative sites 
outside the one being considered and reducing the size of the lease 
reduces the possible size and location alternatives.
    Response: Segregating or merging leases should not have a direct 
impact on the potential liability that the project poses to the 
government, or the need for additional financial assurance to offset it 
because the cost of decommissioning facilities, regardless of the size 
of the lease area, is the key driver to the amount of financial 
assurance that is required. However, BOEM retains at all times the 
authority to review and adjust financial assurance, so if liability

[[Page 42646]]

impacts are identified, BOEM can increase the amount of financial 
assurance required, if necessary. Therefore, BOEM did not make any 
changes to rule provisions based on this comment.
    Comment: A commenter expressed concern that lease period extensions 
and schedule modifications of segregated or consolidated leases could 
lead to decisions made without complete information, and suggested that 
BOEM allow time within the schedule for review of complete information 
prior to any approvals.
    Response: Lease segregation or consolidation does not include the 
guaranteed right to develop the resulting lease area. The scope of the 
COP, which must include significant detail under BOEM's regulations, 
informs BOEM's decision whether to approve development. If descriptions 
of activities occurring in latter phases are incomplete, then BOEM 
would require the submission of complete information before authorizing 
those latter phases.
    Comment: A few commenters provided editorial revision requests and 
suggestions for the proposed rule language, including clearer 
statements related to formal or informal agreements between entities, 
effects of lease segregation on ongoing COP reviews, and revisions to 
conditions for approved COPs. A commenter suggested that BOEM 
explicitly allow the lessee to assign all or part of the lease area to 
other entities. The commenter also suggested that the assignment 
provision provide BOEM flexibility to ensure the proper terms and 
conditions follow the relevant lease areas. Similarly, the commenter 
recommended tailoring financial obligations of assignees and the 
remaining obligations of assignors to track the scope of interest being 
transferred. The commenter proposed a new Sec.  585.408(f), describing 
BOEM's cooperation in these transfers.
    Response: BOEM considered the editorial requests and suggestions 
and decided to eliminate paragraph (b) altogether and added ``to one or 
more parties'' to paragraph (a). The information in paragraph (b) is 
duplicative of the existing Sec.  585.409, and what is already on Forms 
BOEM-0003 and BOEM-0004. The addition of ``to one or more parties'' to 
paragraph (a) was added because BOEM agreed with the comment requesting 
clarity regarding assigning all or parts of a lease to other entities. 
Both renewable and conventional leases may be held by multiple 
entities. Assignment of part of a lease under this final rule results 
in lease segregation. The ability to segregate a lease and assign 
undivided interests simplifies issues like terms and conditions and 
financial obligations. BOEM declined to incorporate the commenter's 
proposed Sec.  585.408(f) because it was more appropriate for 
incorporation into an internal process than a regulation. BOEM agreed 
with comments clarifying that separate plan approvals may be issued for 
a lease that becomes segregated and added Sec.  585.410(c) accordingly.
    Comment: A commenter stated that BOEM exceeded its statutory 
authority by making substantive changes to the statutory criteria for 
lease suspension and cancellation.
    Response: This rulemaking did not propose to change these 
provisions because the Department views them as consistent with OCSLA. 
Some suspension provisions were moved to BSEE-administered regulations 
as part of the Reorganization Rule. For additional details refer to the 
Section-by-Section Analysis for Sec. Sec.  585.417 and 285.417 of 
Section V.
    (d) Civil Penalties.
    Comment: Several commenters expressed support for the proposed 
paragraph at Sec.  585.400(f)(2) authorizing the Department to assess 
civil penalties for certain violations. A commenter expressed that 
``civil penalties. . . should be hard enough to prevent lessees from 
accepting the existence of violations and simply taking the financial 
hit.'' However, another commenter requested that the Department ``take 
steps to ensure that the penalty is reserved for truly serious 
circumstances and require agency notice at some reasonable time after 
the assessment of the civil penalty and prior to the accrual of any 
interest.''
    Response: The paragraph of Sec.  585.400 that is referenced was 
moved to Sec. Sec.  585.106 and 586.106, respectively due to the 
issuance of ``Reorganization of Title 30--Renewable Energy and 
Alternate Uses of Existing Facilities on the Outer Continental Shelf.'' 
The Department has significant experience and a process governing the 
assessment of civil penalties under OCSLA that should adequately 
address the comments received.
    BOEM may invoke a civil penalty if an operator does not correct a 
violation or if the violation posed a threat or harm to safety or the 
environment. The maximum civil penalty is set by law, but BOEM 
determines the amount for a specific violation based on its severity, 
duration, and other factors. Lessees have the right to request informal 
resolution of the decision from the Bureau and to file an appeal with 
the Interior Board of Land Appeals.
    (e) Standardize Annual Rental Rates for Grants.
    Comment: One commenter requested that BOEM reconsider its proposal 
[Sec.  585.508] to change the rental rate for ROW grants to match RUE 
grants because the proposal could increase costs for ratepayers and 
would not facilitate development.
    Response: The final rule does not change rental rate dramatically. 
BOEM believes the $5 per acre annual rate proposed remains modest when 
viewed next to other project costs, and it will simplify the regulatory 
treatment of ROWs, RUEs, and project easements.
    (f) Technical Corrections and Clarifications.
    Comment: A commenter expressed opposition to the proposed language 
relating to regulatory departures at Sec.  585.103, stating that the 
criteria were not well-defined and should only be applied in pre-
determined and narrow circumstances.
    Response: Writing regulatory requirements will always be an 
imperfect process. It is impossible to foresee the specific fact 
scenario that will arise when the regulations are put into practice. 
Departures are how the agency can account for unforeseen situations 
where strict application of the regulations would be unfair, 
impractical, unnecessary or even impossible (for example, unforeseen 
contradictions in regulatory provisions). Drafting the departure 
section to apply only to ``pre-determined and narrow circumstances'' 
would risk leaving the bureau and the regulated community unable to 
respond to unforeseen circumstances outside such pre-determined and 
narrow circumstances.
    Comment: A commenter pointed to inconsistencies between Sec.  
585.102(b) and Sec.  585.628(f), stating that it is unclear whether 
BOEM can modify a COP, or approve a COP with conditions. The commenter 
recommended revising Sec.  585.628(f) to clarify that BOEM does have 
the ability to approve, disapprove, or approve a COP with conditions. 
Another commenter discussed 43 U.S.C. 1334(a)(1) and (2) and 
recommended that the language in the proposed rule preamble Section B.3 
(Administration of Leases and Grants) be amended to match the language 
of the statute.
    Response: BOEM agrees that Sec. Sec.  585.102(b) and 585.628(f) 
should use the same terminology and that ``approve a COP with 
conditions'' should be the consistent phrase used in both regulations. 
BOEM currently approves COPs with conditions and does not modify a 
proposal or re-design a proposed project, thus the use of

[[Page 42647]]

``conditions'' both enhances clarity and is consistent with current 
practices.
    Comment: A commenter stated, ``BOEM does not have the authority 
[under Sec.  585.103] to prescribe or approve deviations from its own 
Federal consistency obligations under the CZMA, nor those of 
leaseholders.'' Further, the commenter stated that BOEM does not have 
authority to change the information that a leaseholder must submit for 
State review, limit the rights of states to request additional 
information, or reduce the time available for consistency review; this, 
in addition to being outside of BOEM's statutory authority, would 
impair the rights of states as third parties, and without such State 
participation could not guarantee protection of the environment and the 
public health and safety to the same degree as if there was no approved 
departure.
    Response: BOEM and BSEE are mindful of their obligations under the 
Coastal Zone Management Act (CZMA). Nothing in the proposed rule will 
impair the rights of states under this important authority. BOEM may 
prescribe departures from its own regulations under the departure 
authority in Sec.  585.103. However, BOEM's departure authority cannot 
be used to exempt a lessee from other agencies' requirements. Last, we 
agree that BOEM's and BSEE's regulations cannot amend the regulations 
in 15 CFR part 930 and, therefore, it is BOEM's and BSEE's position 
that the final rule does not affect any rights or obligations under the 
CZMA.
    Comment: A commenter said that under OCSLA, management of such 
activities should consider economic, social, and environmental values 
of renewable and non-renewable resources contained within the OCS. 
Proper consideration must also be given to other uses of the seabed, 
including fisheries navigation and marine productivity.
    Response: BOEM appreciates this comment and endeavors to give 
appropriate consideration of other uses of the seabed, including those 
cited in the comment, in accordance with its responsibilities under 
subsection 8(p)(4) of OCSLA and BOEM's implementing regulations at 
Sec.  585.102. Further, nothing in the proposed rule and implemented in 
the final rule will change the importance of these considerations in 
BOEM's program.
    Comment: A commenter provided several suggestions for technical 
clarifications in Sec.  585.506 and provided the following 
recommendations for revision: (1) clarify that operating fees would 
also be owed when the developer obtains compensation for electricity 
put onto the grid, (2) add a provision that operating fees ``for the 
design and construction period be paid in a single lump sum within 90 
days of the start of ``commercial operations'' based on the volume of 
electricity sold prior to ``commercial operations'' as measured at the 
delivery point for the project.''
    Response: With regard to operating fee language, specifics 
regarding the timing of when operating fees are incurred are governed 
in the lease instrument. Current leases provide that operating fees are 
incurred once the lessee delivers power to the grid for sale.
    Comment: The commenter requested that the rule clarify the 
definition of ``commercial activities.'' The commenter states that 
``the proposed rule includes requirements to submit a new report, the 
``Project Verification Report,'' at 30 CFR 585.704 and 585.708(a)(5).'' 
The commenter recommends formalizing the Project Verification Report 
and consistently referring to it as such or ``PVR.'' The commenter also 
asks the Department to formalize the name of the Critical Safety 
Systems Commissioning Records (CSSCR) throughout the rule.
    Response: The final rule defines ``commercial activities'' in 
Sec. Sec.  285.112 and 585.113. Project verification report is 
consistently spelled out in the final rule. CSSCR or a derivation of 
such are only used in Sec. Sec.  285.637, 285.710, and 285.714 and BSEE 
does not feel formalization is required.
3. What is the Department finalizing?
    (a) BOEM's responsibilities under OCSLA.
    Sec.  585.102 What are BOEM's responsibilities under this part?
    The proposed rule clarified that none of the enumerated goals are 
intended to outweigh or supplant any other. The final rule clarifies 
further that BOEM needs to reach a rational balance among the goals to 
the extent they conflict or are otherwise in tension The final rule 
also clarifies that BOEM's responsibility to prevent waste on the OCS 
includes the obligation to prevent economic waste and physical waste of 
energy resources from sources other than oil and gas. This 
clarification is supported by provisions in OCSLA regarding the meaning 
of prevention of waste of hydrocarbons.\16\ The Reorganization Rule 
added ``and approved plans'' to paragraph (b) to clarify that BOEM will 
require compliance with approved plans as well as all applicable laws, 
regulations, other requirements, and the terms of the lease.
---------------------------------------------------------------------------

    \16\ e.g., 43 U.S.C. 1334(j)(1)(A).
---------------------------------------------------------------------------

    (a) Lease Structure.
    Sec.  585.235 What are the lease periods for a commercial lease?
    In Sec.  585.235 of the final rule, as in the NPRM, BOEM finalized 
a significant change in the structure of future leases, which will be 
divided into periods instead of terms. Commercial leases under the 
final rule have a Preliminary Period of up to five years, during which 
the lessee prepares and submits the COP. Submission of a COP triggers 
the beginning of the COP Review Period, during which time BOEM conducts 
its NEPA analysis and consultations.
    If the COP is approved, this approval will begin the Design and 
Construction Period, during which BSEE completes the FDR and FIR 
review(s), and the lessee undertakes project construction.
    Once the requirements of Sec.  285.637(a) are satisfied, the lease 
begins the Operations Period. Previously, Sec.  285.637 provided that 
commercial operations may commence 30 calendar days after ``the CVA or 
project engineer has submitted to BOEM the final Fabrication and 
Installation Report for the fabrication and installation review, as 
provided in Sec.  585.708.'' However, Sec.  285.708(a)(5)(ii) allowed 
the lessee to commence commercial operations 30 calendar days after 
BSEE receives the CVA verification report unless BSEE raises objections 
with the lessee during that time. This final rule remedies the 
inconsistency by moving the provision from Sec.  285.708(a)(5)(ii) into 
Sec.  285.637.
    Section 285.637 has been revised to allow lessees to produce and 
sell power prior to final FIR non-objection. The lessees and CVAs must 
submit information to demonstrate that facilities installed prior to 
first producing commercial power have been fabricated and installed and 
that Critical Safety Systems and Equipment have been commissioned 
properly. The lessee may continue to keep producing as long as the 
lessee and CVA continue to submit information demonstrating the 
additional facilities have been fabricated and installed and that 
Critical Safety Systems and Equipment have been commissioned properly 
as they come online. Finally, to improve organization, this final rule 
has moved the prior Sec.  285.713 requirement to notify BSEE within 10 
business days of starting commercial operations into Sec.  285.637.
    The Operations Period lasts 35 years, unless a different duration 
is specified in the lease, or unless a different duration is specified 
in an approved COP. A 35-year default Operations Period is longer than 
the previous default construction and operations

[[Page 42648]]

term, which was 25 years. This is appropriate based on the advancements 
of technology that have occurred since the original renewable energy 
regulations were published in 2009.
    (b) Lease Segregation and Consolidation.
    Sec.  585.410 When will my assignment result in a segregated lease?
    Sec.  585.413 How do I consolidate leases or grants?
    As proposed, the final rule explicitly provides for lease 
segregation and consolidation in Sec. Sec.  585.410 and 585.413, 
respectively. These sections clarify BOEM's procedures for segregating 
and consolidating leases.
    (c) Civil Penalties.
    Sec.  585.106 What happens if I fail to comply with this part?
    The previous Sec.  585.400 was moved to Sec.  585.106 by the 
Reorganization Rule. The final rule specifies the civil penalty 
authority of both BOEM, in Sec.  585.106, and BSEE, in Sec.  
285.400(f).
    (d) Standardize Annual Rental Rates for Grants.
    Sec.  585.508 What rent payments must I pay on ROW grants or RUE 
grants associated with renewable energy projects?
    The final rule does not change the rental rate dramatically. BOEM 
believes the proposed $5 per acre annual rate remains modest when 
viewed next to other project costs, and it will simplify the regulatory 
treatment of ROWs, RUEs, and project easements.
    (e) Technical Corrections and Clarifications.
    Sec.  585.225 What happens if BOEM accepts a bid?
    Sec.  585.231 Will BOEM issue leases noncompetitively?
    BOEM finalized many proposed technical changes, as identified in 
the NPRM. In addition to these, BOEM includes a minor update for 
issuing commercial leases competitively and non-competitively, 
eliminating the requirement to execute multiple paper copies of the 
lease. When BOEM promulgated the regulations in 2009, BOEM anticipated 
a process that would create three original versions of the document: 
two to be held at BOEM and the third to be given to the lessee. 
However, widespread adoption of electronic copies has made this process 
obsolete, and the requirement to execute leases in triplicate is no 
longer needed. Accordingly, we have updated the regulations to remove 
this requirement. In Sec.  585.225(b), BOEM removed references to BOEM 
sending three unsigned copies of the lease form to the provisional 
winner and removed the provisional winner's obligation to execute three 
copies. BOEM no longer needs to sign three copies, and BOEM will send 
the new lessee an electronic version of the executed lease. 
Corresponding changes were made in Sec.  585.231(h) for noncompetitive 
leases.
    Sec.  585.110 When must I notify BOEM of mergers, name changes, or 
changes of business form?
    The final rule also revises Sec.  285.110, as specified in the 
Reorganization Rule (88 FR 6376), to require you to submit one 
electronic copy of all plans, applications, reports, or notices to 
BSEE. BSEE will inform you if it requires paper copies of specific 
documents.

L. Potential Revisions to Regulations Governing Research Activities

1. What did the Department propose?
    Sec.  585.239 Are there any other renewable energy research 
activities that will be allowed on the OCS? [previously Sec.  585.238]
    BOEM did not propose specific revisions to regulations governing 
research activities but solicited comment on ``whether the lease 
process for research activities in existing Sec.  585.238 warrants 
amendment.'' BOEM stated that it was interested in comments on the 
following: ``whether it should create a specific regulatory framework 
for research leases and planning whether it should expand the criteria 
for who can hold research leases; whether the Determination of No 
Competitive Interest (DNCI) requirement can or should be relaxed for 
research activities; and whether any other aspects of this section 
deter OCS renewable energy research'' (88 FR 5991).
2. What are the key public comments?
    There were no significant comments relevant to this section.
3. What is the Department finalizing?
    BOEM did not materially update its regulations on the issuance of 
research leases, though renumbering has moved the section from Sec.  
585.238 to Sec.  585.239.

M. Potential Revisions to Regulations Governing Transmission

1. What did the Department propose?
    Sec.  585.200 What rights are granted with a lease issued under 
this part?
    Subpart D--ROW and RUE Grants for Renewable Energy Activities.
    BOEM did not propose specific revisions to regulations governing 
transmission, however it recognized in the NPRM preamble the need to 
minimize impacts to the environment and natural and cultural resources, 
while maximizing the utility of land-based points of interconnection. 
BOEM also noted that it was continuing efforts to explore a coordinated 
approach to transmission. BOEM specifically solicited comment ``on the 
types of regulatory changes that would be appropriate to better 
accommodate these options and to minimize impacts to environmental, 
natural, and cultural resources'' (88 FR 5991). Further, BOEM included 
the following example ``should 30 CFR 585.200(b) be modified to allow 
BOEM to encourage or require use of such options where they are 
available and allow for full enjoyment of the lease? What approaches or 
options should BOEM consider advancing in 30 CFR 585.200(b) to 
facilitate interconnection for lessees, while minimize impacts to 
important resources?''
2. What are the key public comments?
    Comment: A commenter recommended requiring ``spatial separation 
standards for submarine cables and renewable energy infrastructure, to 
alleviate cable crowding, overlapping, and potential cable breakage 
that may disrupt communication and energy supply, and damage to the 
marine environment'' and spacing leases to allow for designated cable 
corridors between lease areas.
    Response: The appropriateness of spacing may be dependent on local 
conditions and technologies employed. Therefore, this information is 
more appropriate for guidance and technical standards than codifying in 
regulations. BOEM published OSW cable spacing guidance in 2015, which 
is available here: Offshore Wind Submarine Cable Spacing Guidance 
[verbar] Bureau of Ocean Energy Management: https://www.boem.gov/newsroom/notes-stakeholders/offshore-wind-submarine-cable-spacing-guidance.
    Comment: A commenter recommended aligning transmission policies 
with State policy initiatives and RTO/ISO grid planning processes to 
avoid delays.
    Response: BOEM currently has the authority to issue a ROW/RUE Grant 
either competitively, or non-competitively as described in Sec. Sec.  
585.300-585.316, after coordinating and consulting with relevant 
Federal agencies, the Governor of any affected State, and the executive 
of any affected local government. BOEM must first determine if there is 
competitive interest, which is accomplished by publishing a public 
notice describing the parameters of the project, to give affected and 
interested parties an opportunity to comment on the proposed grant 
area. BOEM currently

[[Page 42649]]

has the authority to work with a State seeking a ROW/RUE grant for 
purposes of transmission, and as the ROW would necessarily need to be 
continued through State waters and land for the purpose of 
interconnection to the grid, there is the need to align processes. 
However, BOEM agrees that regulatory clarity is helpful in this 
instance, and added clarifications to the final rule that includes a 
discussion of how State, RTO/ISO, and Federal processes may be better 
aligned.
    Comment: A commenter recommended allowing more time for the 
submission of GAPs ``upon a sufficient showing of good cause'' due to 
the ``complexity of designing and planning shared transmission 
solutions.''
    Response: The final rule in Sec.  585.236(b) states, as proposed, 
that the preliminary period may be extended if the requested extension 
can be justified for ``good cause.''
3. What is the Department finalizing?
    BOEM is continuing to develop and implement a planned approach to 
transmission that includes the use of shared transmission 
infrastructure and corridors, meshed systems, and the development of an 
offshore grid, where appropriate. On September 19, 2023, DOE and BOEM 
released An Action Plan for Offshore Wind Transmission Development in 
the U.S. Atlantic Region (https://www.energy.gov/gdo/atlantic-offshore-wind-transmission-action-plan), which included a set of actions to 
support offshore wind energy.
    Sec.  585.203 With whom will BOEM consult before issuance of 
leases?
    Sec.  585.212 What is area identification?
    BOEM agrees with the importance of a comprehensive and coordinated 
spatial planning effort. Sections 585.203 and 585.212 identify what is 
evaluated during area identification and with whom BOEM will consult 
before the issuance of a lease. These two touchpoints are critical for 
the review of other available offshore resources and the potential for 
avoidance or minimization of impacts to these resources. BOEM plans to 
increase internal coordination between programs and will investigate 
potential guidance for renewable energy that could help mitigate 
potential sand borrow resource area impacts from renewable energy 
transmission and development.
    Sec.  585.213 What information is included in the PSN?
    Sec.  585.214 What information is included in the FSN?
    In response to the suggestion to use bid credits to promote shared 
transmission lines, BOEM will develop and propose any bidding credits 
in the PSN, and later confirm the availability of those credits in the 
FSN, which allows for comments and potential modification. BOEM might 
offer such bidding credits in future lease sales when it deems 
appropriate, however, this is beyond the scope of the current 
rulemaking.
    Sec. Sec.  585.300-585.316 ROW Grants and RUE Grants.
    BOEM currently has the authority to issue a ROW/RUE grant either 
competitively, or non-competitively, as described in subpart D, 
Sec. Sec.  585.300 through 585.316, after coordinating and consulting 
with relevant Federal agencies, the Governor of any affected State, and 
the executive of any affected local government. BOEM must first 
determine if there is competitive interest, which is accomplished by 
publishing a public notice describing the parameters of the project, to 
give affected and interested parties an opportunity to comment on the 
proposed grant area. BOEM currently has the authority to work with a 
State seeking a ROW/RUE grant for purposes of transmission, and as the 
ROW would necessarily need to be continued through State waters and 
land for the purpose of interconnection to the grid, there is the need 
to align processes. However, BOEM agrees that regulatory clarity is 
helpful in this instance, and has added language in Sec.  585.307(c), 
which describes the process BOEM may use to consider transmission 
projects initiated by states or ISO/RTOs where a ROW/RUE would be 
required. This provision clarifies how BOEM can consider decisions by 
the state/RTO/ISO in the determination of competitive interest.
    Sec.  585.307 How will BOEM determine whether competitive interest 
exists for ROW grants and RUE grants?
    Under this section in the final rule, BOEM may consider a state's 
or Regional Transmission Operator/Independent System Operator's process 
that identifies a transmission project that needs a ROW and/or a RUE 
grant to achieve its intended purpose. BOEM may determine that there is 
no competitive interest that would be consistent with OCSLA's goal of 
allowing the expeditious and orderly development of OCS energy 
projects, if offering the ROW and/or RUE competitively could challenge 
the viability of the transmission project intended to be located on 
State submerged lands and the OCS (e.g., technical and economic 
feasibility or practicality concerns, including significant delays, by 
having different entities holding the right to develop the transmission 
project in State submerged lands and the OCS).
    In response to the comment recommending defining roles between 
BOEM, DOE, FERC, and RTO/ISO, BOEM agrees that coordination among these 
entities is critical to the transmission planning process and will 
continue to take steps to further refine roles and responsibilities as 
the industry continues to develop. Additionally, BOEM and FERC signed a 
Memorandum of Understanding (MOU) on April 9, 2009. The purpose of this 
MOU was to clarify jurisdictional understanding regarding renewable 
energy projects in offshore waters on the OCS, in order to develop a 
cohesive, streamlined process that would help accelerate the 
development of wind, solar, and hydrokinetic (i.e., wave, tidal, and 
ocean current) energy projects.
    In response to commenters' suggestions of identifying buffer areas 
around offshore lease areas for use by competitively bid transmission 
development and offshore substations, BOEM does not believe that buffer 
areas are required for this purpose as rights granted through leases 
are non-exclusive provided other uses do not unreasonably interfere 
with the lessee's activities.

N. General Comments and Responses

    This section describes a summary of the general comments that 
commenters have provided on the NPRM, in addition to those comments 
classified elsewhere.
1. The Offshore Wind (OSW) Development Process
    Comment: Some commenters expressed concern for, and opposition to, 
streamlining BOEM's processes for OSW development. They said the 
proposed rule will increase the risk of harm to the environment, 
natural resources, and cultural resources near the Yurok Ancestral 
Lands in order to expedite and lower the costs for OSW energy projects. 
Commenters discussed impacts to the fishing industry. A commenter 
stated the OSW process must be halted until a full review and analysis 
ensures that OSW development will not destroy fisheries and marine 
ecosystems. The commenter also discussed the lack of engagement with 
the fishing industry and impacts on the fishing industry that the 
commenter claims will be removed from fishing areas due to OSW 
development. Another commenter discussed the comments from fishing 
industry expressing concern with OSW planning processes under the 
existing regulatory

[[Page 42650]]

framework which, according to the commenter, lease the health of the 
marine environment and fishing industry to the OSW industry. The 
commenter expressed frustration with BOEM favoring interests of the 
regulated industry over those of the public and existing ocean users 
who are impacted by BOEM's regulated activities and OSW energy 
development.
    Response: The Department acknowledges the opposing comments 
received from the commenters and have finalized the proposed rule with 
changes that take into account public feedback, as discussed further in 
this document.
    The comment states opposition to the rulemaking invoking potential 
harms but does not indicate which revisions will have purported 
negative effects or why. The final rule streamlines the Department's 
process and creates efficiencies without increasing negative impacts on 
fisheries and without increasing the risk of harm to the environment, 
cultural resources, or Tribal ancestral lands. We strongly disagree 
that this rule favors the interests of regulated industry over those of 
the public or existing ocean users who are impacted by the Department's 
regulated activities. The final rule does not streamline or reduce the 
Department's consultation processes, environmental reviews, or 
stakeholder engagement.
    Comment: A commenter stated that OCSLA provides BOEM with room to 
amend existing leases to incorporate an operating fee credit. 
Specifically, the commenter noted that they are not aware of any 
statutes or regulations that prevent BOEM from amending the existing 
regulations at Sec.  585.506 to establish an operating fee credit that 
could be used to reduce operating fee obligations. The commenter 
remarked that providing for such an operating fee credit would 
represent a logical outgrowth of BOEM's formalization of the multiple 
factor auction format via the proposed rule and would be consistent 
with the IRA's apprenticeship requirement for renewable energy 
facilities.
    Response: BOEM has not adopted modifications to the final rule that 
would be required for the agency to amend existing leases to implement 
operating fee credits. BOEM has not seen a need to expand its authority 
such as would be needed to amend the leases as suggested--existing 
authority can promote policy objectives via bidding credits and lease 
stipulations. BOEM is currently incorporating the use of bidding 
credits in its lease auction procedures and can choose to evaluate 
individual projects on their workforce utilization as the projects are 
proposed. However, BOEM has not made changes in the final rule to add 
operating fee credits for employers meeting the IRA apprenticeship 
requirements.
    Comment: A commenter remarked that, except for the Safety 
Management System (SMS) section, every section of the proposed rule is 
designed to increase flexibility for developers without considering the 
impact on other stakeholders. The commenter stated that, ``BOEM quotes 
E.O. 14008 as justification for further streamlining the OSW process 
for the benefit of developers.'' However, the commenter believed this 
would ``be inconsistent with the April 6, 2023, E.O., Modernizing 
Regulatory Review, which states, ``Public trust in the regulatory 
process depends on protecting regulatory development from the risk or 
appearance of disparate and undue influence,'' and that agencies 
``shall incorporate'' in the development of regulatory agendas an 
``expansion of public capacity for engaging in the rulemaking 
process.'' The commenter stated that BOEM's proposed Renewable Energy 
Modernization Rule does the opposite, by, for example, allowing 
developers to submit a COP without proposed turbine locations, which 
makes public input on various Alternatives difficult to impossible, 
particularly as changing turbine locations materially affect the 
``viability'' of other Alternatives. The commenter stated that BOEM has 
not changed its process to increase the assurance of safety or 
protection of commercial fisheries and species in its process. The 
commenter stated further that BOEM has given deference to developers 
even in creating a purpose and need statement for NEPA review, 
consistently overridden cooperating agencies in favor of developer 
generated ``science'' and other documents. Finally, the commenter 
stated that this is inappropriate but is the clear trajectory of BOEM's 
approach, furthered by the proposed rule.
    Response: BOEM is deferring only the submission of deep borings 
used for final engineering and design at every foundation location 
until after project approval, when the positions approved by BOEM for 
actual installation would be finalized. This is distinct from 
``allowing developers to submit a COP without proposed turbine 
locations.'' To the contrary, a COP will still need to include the 
areas within the lease that are proposed for development, one or more 
indicative layouts including proposed spacing between turbines, a 
maximum number of positions and other significant details for 
consideration by the public. This information provides the public with 
sufficient detail to comment on areas to avoid, navigational safety 
concerns with the proposed layout, and many other aspects. Further, as 
part of the COP's environmental review under NEPA, the public is free 
to describe impacts to stakeholders for BOEM's consideration, propose 
one or more specific alternative turbine layouts, or provide other 
relevant comments. Lastly, the purpose and need statements in BOEM's 
environmental impact statements for COPs are consistent with applicable 
NEPA law, which allows for an agency to consider the goals of the 
applicant.
    Comment: A commenter noted the need for rulemaking in terms of the 
growing concerns related to OSW and the need to support communities, 
like delivery of benefits to Tribes and stakeholders. The commenter 
discussed Pacific Wind Lease Sale 1 where the commenter claimed that 
successful bidders did not engage local Tribes to ensure equitable 
development of OSW.
    Response: The rulemaking process offers multiple opportunities for 
BOEM and BSEE to listen and respond to Tribes' and other stakeholders' 
concerns about OSW permitting and development. BOEM and BSEE encourage 
early communication between parties interested in OSW development and 
potentially impacted Tribal Nations. BOEM and BSEE are committed to an 
open and transparent process and ensuring that Tribes have the 
opportunity for meaningful participation. BOEM invited federally 
recognized Tribes to consult on this rulemaking and held government-to-
government meetings with several Tribes that requested to meet with 
BOEM leadership. Lessees are required to make reasonable efforts to 
engage with local Tribes after lease issuance for direct conversations 
about equitable development, and to report to BOEM on the status of 
engagement and communicate how tribal input has been used in the 
project. BOEM welcomes consultation at all stages of the authorization 
process.
    Comment: A few commenters supported the proposed amendments that 
would align the NEPA and CZMA review processes and asked for 
clarification or revisions regarding this change. A commenter asked 
BOEM to clarify how this would apply to existing OSW projects in 
different stages of the planning and reviewing process. A commenter 
said that BOEM should outline a notification process to inform states 
of whether a lessee intends to voluntarily submit a consistency

[[Page 42651]]

certification. The commenter also suggested that BOEM should ensure 
that the Federal consistency application forwarded to states includes 
the consistency certification and all necessary data and information. A 
commenter suggested clarifying the preamble by stating that BOEM ``will 
make the draft NEPA analysis available at the same time as the 
submission of NDI [necessary data and information] for CZMA review, and 
that the draft NEPA analysis functions as NDI in the review process.'' 
The commenter also agreed with BOEM that the amendment would implicate 
the ``active application'' provision at 15 CFR 930.51(f), however, the 
commenter recommended cross referencing Sec.  930.58(a) in the final 
rule, as this is the relevant section of the CZMA for establishing the 
Federal consistency review start date. The comment also suggested that 
BOEM revise the amended language at Sec.  585.628(c) regarding 
information requirements to apply to pre- and post- lease COPs, despite 
the rare occurrence of an applicant submitting a COP prior to issuance 
of a lease. Furthermore, the commenter stated that the Federal 
consistency application materials sent to the State should include the 
consistency certification, draft NEPA analysis, and all necessary data 
and information.
    Response: For projects that are already in the review process, 
implementation questions will be addressed on a case-by-case basis, in 
coordination with states and lessees. To avoid delays in the 
application process, BOEM will encourage lessees who propose to 
voluntarily submit consistency certifications to states to coordinate 
with the State coastal management program at their earliest 
convenience. If the activity requires a consistency review under 15 CFR 
part 930, subpart D, the applicant will coordinate with BOEM and the 
State coastal management program to ensure all of the necessary data 
and information along with the consistency certification, as required 
in 15 CFR 930.58(a), is submitted in a timely manner. Based on the 
current proposed revisions, this would include, at a minimum, an 
analysis of environmental factors listed by the State's coastal 
management program. A State's coastal management program may utilize a 
draft Programmatic NEPA analysis in the form of an EA or EIS; or use a 
Determination of NEPA Adequacy as its source for the required 
environmental analysis to conduct an adequate consistency review.
    BOEM agrees that amending the language at Sec.  585.628(c) 
regarding information requirements to apply to pre- and post- lease 
COPs be held to the same necessary data and information requirements in 
15 CFR 930.58(a), which would include the draft NEPA analysis (despite 
how unlikely it is in practice that an applicant would submit a COP 
prior to lease issuance). It is noted that, if the COP is submitted 
post-lease, it would fall under the requirements of 15 CFR part 930, 
subpart E, and the applicant would submit the necessary data and 
information, along with the consistency certification to BOEM. BOEM 
would ensure that all of the necessary data and information and 
consistency certification are included in the application for the State 
coastal management program to conduct an adequate consistency review. 
Once it is determined that the application contains all of the required 
information, BOEM would submit the application to the State for 
consistency review.
    Comment: A commenter recommended revising Sec.  585.210 to clarify 
that the competitive lease process will include public meetings for 
oral comment.
    Response: BOEM sees public input as a critical component of the 
safe and responsible development of offshore resources. Public 
engagement and comment are an integral part of the leasing process. 
BOEM strives to make meetings convenient and easily accessible to the 
public. BOEM acknowledges the commenter's concerns and will continue to 
plan meetings to provide the opportunity for public participation with 
both virtual and in person meetings. Although this may not involve 
opportunities for oral comment, those interested in commenting will 
have opportunities to do so.
    Comment: Three commenters requested extensions to the public 
comment period for the NPRM, including:
     A request for a 45-day extension due to the critical 
importance of the regulations, the length and complexity of the 
proposed rule and impacts on the fish and wildlife species that are 
under State agency authority to manage.
     A request for a 30-day extension given the scope and 
magnitude of the rulemaking.
     A request for an unspecified extension of the comment 
period and withdrawal of the rule.
    Response: BOEM published the NPRM entitled ``Renewable Energy 
Modernization Rule'' on January 30, 2023, with a comment period of 60 
days ending on March 31, 2023. In response to several requests to 
extend the comment period, BOEM published a notice on March 30, 2023, 
notifying interested parties that the comment period was being extended 
an additional 30 days to a total of 90 days and ending on May 1, 2023.
    Comment: A commenter suggested BOEM has a conflict of interest in 
both developing potential OSW properties while also regulating the 
development in a safe manner that includes the interests of the public 
and developers. The commenter mentioned the distinction between BSEE's 
regulation of operational safety of the projects but noted there should 
also be a safety function that includes development and construction 
safety as well.
    Response: The Secretary has delegated authority to BSEE for safety 
and environmental oversight and enforcement related to OSW, including 
at the development, construction and operations stages of development. 
Since the proposed rule was published for public comment, the 
administration of the Department regulations related to OSW safety and 
enforcement have now been transferred to BSEE.
    We disagree that BOEM's role creates the conflict of interest, as 
described in the comment. First, BOEM does not ``develop potential OSW 
properties.'' Instead, its Mission Statement is to ``manage development 
of U.S. Outer Continental Shelf energy, mineral, and geological 
resources in an environmentally and economically responsible way.'' 
Responsible development means allowing access to the OCS for 
development in a way that does not endanger safety, other ocean uses, 
environmental resources, etc.
    BSEE's role in the safety of projects is not confined to 
operational safety. BSEE also has oversight of development, 
construction, operation, and decommissioning.
    Comment: A commenter expressed support for an addition to the 
renewable energy modernization rule that allows the use of Federal 
funds from lease auctions to further the goals of the DOE's Strategy to 
Accelerate and Expand Domestic OSW Deployment and address challenges 
with supply chains and workforce development.
    Response: BOEM would need additional statutory authority to apply 
Federal funds from lease auctions to other policy purposes, including 
the advancement of worthy goals like the ones articulated in the 
comment. Therefore, BOEM decided not to incorporate the commenter's 
suggestion into the final rule.

[[Page 42652]]

    Comment: A commenter opposed the proposed rule, stating that the 
changes result in the ``elimination of important research, leaving data 
gaps unfilled, and skipping robust scientific analysis in favor of 
highly questionable assumptive choices'' that could impact fishing 
industries and the health of the oceans and marine ecosystems. 
Similarly, a commenter stated that draft EIS documents have decreased 
in quality, containing such little analysis that there is no 
distinction between Alternatives.
    Response: The Department disagrees that any of the provisions in 
the proposed rule would have the effects described. The comment fails 
to describe how the rule might eliminate important research. BOEM and 
BSEE fund research, and will continue to do so, and nothing in this 
final rule is expected to impact the amount of important research 
taking place. The comment says the final rule will leave data gaps 
unfilled but does not say which of the changes being finalized here 
would have that effect. The comment says the revised regulations will 
skip robust scientific analysis in favor of highly questionable 
assumptive choices, but nothing finalized in this rule would do that. 
BOEM's NEPA reviews are extraordinarily time-intensive products that 
occupy teams of subject matter experts, contractors, and other Federal 
and State authorities. BOEM proposes numerous alternatives in each 
document, in excess of what is required by law. BOEM disagrees with the 
commenter's characterization of the documents that BOEM has prepared 
under NEPA and notes that such comments are outside the scope of the 
current rulemaking.
    Comment: A few commenters suggested that BOEM include a domestic 
supply chain requirement for construction materials for OSW projects 
and should require a Step Certification document to ensure compliance 
with supply chain requirements. The commenters suggested that BOEM has 
authority to and should stipulate the use of American-produced 
construction material in lease agreements and approvals for COPs to 
ensure the maximum return to the government from the lease sale, 
provide environmental benefits due to a reduced carbon footprint from 
OSW development and potentially cleaner production processes, improve 
national security, create jobs and support communities, and comply with 
executive orders requiring Federal agencies to combat climate change. 
The commenters suggested that if BOEM does not support the development 
of a domestic supply chain, there could be delays in construction and 
operations, a loss of jobs, and a lower financial return to the 
government.
    Response: BOEM is very interested in ensuring that the U.S. supply 
chain is adequately developed and capable of cost-effectively serving 
the needs of the U.S. OSW industry. The most important factor within 
BOEM's control that can contribute to the supply chain is to facilitate 
a reliable pipeline of OSW projects. BOEM strives to make suitable 
offshore acreage available for this purpose, but it is also important 
that the cost of OSW energy is low enough for states and utilities to 
support it. This means balancing the desire to accelerate domestic 
sourcing with controlling OSW development costs. Accordingly, BOEM has 
investigated other methods of promoting the domestic supply chain, such 
as bidding credits, over potentially more costly options, such as a 
requirement to source materials domestically. However, we do not 
believe it is appropriate to impose domestic sourcing requirements as 
requested in this comment.
    Comment: A commenter stated that BOEM should stipulate that lessees 
must enter into PLAs that provide for skilled laborers, avoid labor 
disputes, and increase efficiency for obtaining construction materials 
and completing projects.
    Response: BOEM strongly supports union labor and tools like project 
labor agreements. This support has recently been reflected in leases, 
which promote the use of PLAs. However, requiring the use of PLAs for 
all projects is outside the scope of the current rulemaking.
    Comment: A commenter suggested that BOEM use the regional ocean 
planning process to address conflicts upfront and ensure informed 
siting decisions that balance the needs of states, Federal agency 
missions and objectives, ocean users, Tribal governments, communities, 
and the Fishery Management Councils. The commenter suggested that BOEM 
consider developing a coordination framework to allow government and 
public coordination prior to the required public comment periods and 
include not just Federal, Tribal, State(s), and local agencies, but 
also ocean users, communities, and other potentially interested 
parties. The commenter suggested that this coordination could aid in 
efficiency of reviews and improve working relationships among all 
parties.
    Response: BOEM is an active member of several Regional Ocean 
Partnerships (ROPs), including the Northeast Regional Ocean Council 
(NROC), the Mid-Atlantic Council on the Ocean (MACO), and Pacific West 
Coast Ocean Alliance (WCOA). These bodies serve as regional fora for 
coordination, providing data and information via Ocean Data Portals, 
and developing and communicating best practices for decision-making. 
For example, NROC is drafting a set of best practices that can be 
implemented in ocean permitting and management processes that enhance 
stakeholder engagement, agency and interjurisdictional coordination, 
the use of data and information, and regulatory pre-application 
practices. ROPs also host efforts like the Regional Wildlife Science 
Collaborative, a partnership among States, Federal agencies, 
environmental groups and the OSW industry to coordinate science and 
monitoring related to wildlife and OSW on the Atlantic coast. Regional 
ocean planning is a key component of BOEM's intergovernmental 
coordination and collaboration, and our ongoing stakeholder engagement 
efforts. BOEM's participation in ROPs has resulted in enhanced 
coordination among Federal, Tribal State, and stakeholders on ocean and 
coastal issues. BOEM will continue to participate in ROPs to enhance 
interjurisdictional coordination, provide additional opportunities to 
engage stakeholders, ensure expertise and resources are being 
leveraged, and utilize the regional ocean data portals.
2. Environmental Reviews and Evaluations
    Comment: One commenter suggested that ``subsurface and airborne 
monitoring for endangered, threatened, and protected species should be 
required at all stages'' of OSW development.
    Response: The Department's regulations do not require the lessee to 
perform specific studies but instead requires the results of studies to 
support submission of a plan. Specific methodologies to achieve these 
goals have been detailed in guidance documents to lessees available on 
BOEM's Guidance Portal under the Renewable Energy Guidance Tab at 
https://www.boem.gov/about-boem/regulations-guidance/guidance-portal. 
Appropriate monitoring methodologies are ordinarily developed on a 
case-by-case basis as part of the environmental reviews and associated 
consultations, such as ESA section 7 consultations with NMFS.
    Comment: A commenter asserted that the proposed rule does not 
adequately incorporate a rigorous environmental review process into the 
renewable energy program planning process. Here, the commenter 
suggested that an earlier NEPA analysis would be necessary to account 
for the impacts of OSW

[[Page 42653]]

development on marine ecosystems. Further, the commenter asserted that 
BOEM ``undertake a cumulative impacts analysis'' for at-risk species 
before issuing leases. Similarly, a commenter asserted that a NEPA 
analysis should be completed prior to finalization of the rule, 
reasoning that small fishing industries and small coastal communities 
would be impacted by the rule as it could disincentivize developers 
from working with these businesses and communities and could fast-track 
projects without full consideration of their impacts. Another commenter 
asserted that BOEM has inadequately considered the impacts of marine 
spatial planning on fishing communities. Here, the commenter argued 
that BOEM's rationale against further NEPA analysis--that the four-
stage permitting system for offshore development ensures no 
construction may take place ``prior to issuing a Constructions and 
Operations Permit'' does not adequately justify BOEM's assertion that 
NEPA analysis is not necessary.
    Response: BOEM is not using this final rule to change its approach 
to environmental reviews in the area identification process. BOEM's 
existing area identification process does not require completion of an 
EIS to analyze the potential impacts of building out OSW generation 
facilities because identifying areas and holding a lease sale do not 
constitute an irreversible and irretrievable commitment of resources. 
BOEM does conduct extensive data collection and public engagement 
during this process, but at the time lease areas are identified, no 
project has been proposed, the technology used for any facilities that 
may later be installed is not known, and the surveys that lessees 
conduct in preparing a COP is not available. An EIS conducted under 
such circumstances would need to be at a high level of generality, 
would be highly speculative, likely would not provide adequate NEPA 
analysis for the decision to approve a COP, and would result in the 
need for an additional NEPA to be conducted at a later time.
    Comment: A commenter requested a period of public comment on any 
proposed EA prior to a final decision on the rule.
    Response: BOEM conducted an initial NEPA analysis for the proposed 
rulemaking and determined that the proposed rule met the criteria for 
categorical exclusion under 43 CFR 46.210(i) of DOI's implementing NEPA 
regulations. The regulations set forth in this rule are ``. . . of an 
administrative, financial, legal, technical, or procedural nature.''
    Comment: Multiple commenters stated that BOEM should conduct 
regional studies or a Programmatic Environmental Impact Statement 
(PEIS) to analyze the potential impacts of OSW development, including 
along the West Coast of the United States and the Gulf of Maine. 
Commenters stated that a regional PEIS completed at the early stages of 
lease planning could help BOEM, developers, and reviewers better 
understand cumulative impacts, improve the efficiency of the 
environmental review process, provide opportunities for siting a wider 
range of potential alternatives, speed up the permitting process, and 
address potential conflicts early in the review process. A few 
commenters suggested that the proposed rule should require that BOEM 
conduct a PEIS before determining lease areas and should consider 
socioeconomic impacts on coastal communities, an economic study of 
fisheries, a fair market assessment of capital assets necessary for 
commercial fishing activities, and impacts on upwelling, food web 
productivity, and carbon capture. A commenter suggested that BOEM 
develop a comprehensive regional plan for wind energy development on 
the West Coast to describe collaborative actions and best practices 
``to inform and guide Federal, State, Tribal, and Fishery Management 
Council activities under existing authorities.''
    Response: BOEM is supportive of PEISs, but also maintains that 
timing and purpose are key considerations. Prior to the leasing stage, 
BOEM collects and analyzes available data and information to delineate 
areas of least conflict and conducts environmental reviews before 
deciding whether a lease may be issued. BOEM is best equipped to 
undertake an EIS analysis when BOEM has adequate information to inform 
how leases in the area are likely to be developed based on a final 
lease area size and location, including site-specific conditions.
    BOEM is incorporating the latest in modeling science and technology 
to examine potential impacts of leasing decisions in a holistic, 
dynamic, and forward-looking way. To accomplish this, BOEM is working 
with NOAA's National Centers for Coastal Ocean Science (NCCOS), to 
synthesize and model collected ocean use, conservation, and fishing 
data. BOEM has used and will continue to use this ocean planning tool 
to help identify areas of the U.S. OCS with minimal conflicts, and to 
inform the development of Call Areas and WEAs for public review and 
comment prior to final designations, as a general practice. In 
conjunction with the NCCOS modeling, BOEM is also funding the 
Standardizing Integrated Ecosystem-Based Assessments (SIEBA) study, 
which will create an ecosystem-based management (EBM) framework to help 
us identify more ways to manage ocean resources in an ecologically and 
economically responsible manner. Both the NCCOS modeling and the SIEBA 
study provide BOEM with additional tools in its OSW energy planning and 
leasing process.
    Comment: A commenter asserted that the proposed rule ignores 
requests for environmental studies.
    Response: The final rule does not affect the manner in which BOEM 
conducts environmental studies and reviews of the activities it 
authorizes on the OCS. Also, the final rule does not authorize any 
activities on the OCS. It should be noted that, through its 
environmental studies program (ESP), BOEM funds millions of dollars in 
research each year, much of it devoted to impacts associated with OSW 
development. BOEM develops, funds, and manages rigorous scientific 
research specifically to establish information needed for assessing and 
managing environmental impacts of energy and mineral development on the 
human, marine, and coastal environments. Mandated by section 20 of 
OCSLA, the ESP is an indispensable requirement informing how BOEM 
manages offshore oil and gas, offshore renewable energy, and the marine 
minerals program for coastal restoration. The ESP has provided over $1 
billion for research since its inception in 1973. Research covers 
physical oceanography, atmospheric sciences, biology, protected 
species, social sciences and economics, submerged cultural resources, 
environmental fates and effects, oil spills, and more.
    All OCS wind development is subject to environmental review. BOEM 
is supportive of PEISs, but also maintains that timing and purpose are 
key considerations. Prior to the leasing stage, BOEM collects and 
analyzes available data and information to delineate areas of least 
conflict and conducts environmental reviews before deciding whether a 
lease may be issued. BOEM is best equipped to undertake an EIS analysis 
when BOEM has adequate information to inform how leases in the area are 
likely to be developed based on a final lease area size and location as 
well as site-specific conditions.
    Comment: A commenter stated that BOEM should ensure that adequate 
information is developed through the

[[Page 42654]]

COP NEPA analysis ``for states to understand and review the coastal 
effects of all design options, in order to maintain efficiencies within 
the review process and avoid the need for supplemental consistency 
review when final design decisions are made.''
    Response: The final rule clarifies procedures for providing NEPA 
analyses to states as part of the CZMA consistency review.
    Comment: A commenter suggested BOEM revise Sec.  585.627 to clarify 
that the requirements set out by this section are necessary to ensure 
BOEM analyzes activities expected to significantly affect the 
environment, including actions that are not within BOEM's siting 
authority or jurisdiction.
    Response: Most of the commenter's suggestions were accepted and 
appropriate changes were made in reflection of the comments. BOEM also 
made parallel edits to the relevant SAP regulations at Sec.  585.611(b) 
and the relevant GAP regulations at Sec.  585.646(a) and (b) because 
BOEM's plan requirements have parallel structures regarding NEPA. For 
specific details, see discussion at Section V. Section-by-Section 
Analysis, Sec.  585.627.
    Comment: A commenter concluded that the proposed rule raises 
multiple concerns about the protection of the marine ecosystem and 
warrants NEPA review. A commenter stated that ESA consultation should 
be reinitiated and asserted that BOEM has failed to rely on the best 
available scientific data, particularly with respect to the critically 
endangered North Atlantic right whale, and failed to include sufficient 
measures to avoid, minimize, and mitigate the impacts to the point 
where they are not likely to adversely affect this critically 
endangered species.
    Response: The final rule is of an administrative nature, does not 
authorize any activity on the OCS and, therefore, is categorically 
excluded from the need to prepare an Environmental Impact Statement. 
ESA consultation for the promulgation of the final rule is unwarranted 
because the final rule does not authorize any activities and, 
therefore, the Department's action has no effect on threatened or 
endangered species protected by the ESA.
    Comment: A commenter said that BOEM should incorporate into the 
proposed rule a requirement for a full EIS before BOEM decides on the 
wind areas for potential leases to allow for meaningful input from the 
public on the sites and potential alternative locations.
    Response: BOEM disagrees that opportunities for meaningful input 
are not available in BOEM's current area identification process, 
consultations and repeated engagement with Federal agencies, Tribes, 
State agencies, industries, and stakeholder groups. BOEM ordinarily 
starts the process with a Request for Information with a comment 
period, along with intense consultation with other Federal agencies, 
Tribes, State and local governments at meetings that are open to the 
public. During this time, the agency ordinarily also holds public and 
private meetings with stakeholder groups and nongovernmental 
organizations. BOEM's current policy is to also publish the area 
identification in draft form for comment prior to publication of Wind 
Energy Areas. This marks the end of the area identification process, 
though BOEM continues stakeholder engagement and public outreach, and 
lease areas often continue to be refined during the stages the follow, 
which includes meetings related to a lease sale environmental 
assessment, as well as the Proposed Sale Notice comment period.
    Moreover, an EIS at the area identification stage of development 
(which is not required) would be limited in several important ways. 
Actual development would not take place for a significant time, meaning 
the technology that would be used is likely to evolve--perhaps 
dramatically--before facilities can be deployed. BOEM would not be able 
to analyze the potential impacts of yet-to-be-specified (or maybe even 
invented) technology. Further, a great deal of the project design is 
dependent on site-specific data that cost tens of millions of dollars 
to obtain. Such data are currently generated by lessees, who make these 
investments with the hope of developing a project that will repay that 
investment. Thus, the specificity and usefulness of an area 
identification EIS would be limited, such that an additional EIS would 
likely be required once the data were available and development more 
imminent. BOEM seeks a maximally informed decision-making process 
without unnecessarily repeating NEPA analyses.
    Comment: A commenter stated that BOEM should maintain opportunities 
for public comment and review in the final rule by ensuring that any 
findings from deferred survey work that show environmental impacts are 
sufficiently subject to public review and scrutiny.
    Response: The final rule will allow lessees to defer some deep 
borings to a later stage of development. However, this is not meant to 
affect the level of public availability of information; only the timing 
of when a subset of the geotechnical information is required to be 
submitted. Further, the deferred information is not necessary to assess 
environmental impacts or whether the facilities can be safely 
installed. The partial deferral of geotechnical survey information is 
more relevant to the technical design of the facility.
    Comment: A commenter requested a public comment period and 
preparation of an environmental analysis of the rulemaking before BOEM 
decides whether to publish a final rule and what to include in it.
    Response: A NEPA analysis is not required because the proposed rule 
is covered by a categorical exclusion (see 43 CFR 46.205). The final 
rule meets the criteria set forth at 43 CFR 46.210(i) for a 
Departmental categorical exclusion and the Department has also 
determined that the final rule does not involve any of the 
extraordinary circumstances listed in 43 CFR 46.215 that would require 
further analysis under NEPA. Therefore, a public comment period on a 
NEPA analysis of the proposed rule will not be provided.
3. Procedural Matters
    Comment: A commenter asserted that BOEM's definition of the 
baseline scenario in the existing regulatory framework does not 
consider the impacts to small fishing businesses and small coastal 
communities and suggested that BOEM conduct a regulatory impact 
analysis due to these potential impacts.
    Asserting that Public Law 104-121, Title II, 110 Stat. 857 (1996), 
requires BOEM to consider input from small businesses and entities, 
another commenter suggested that the agency has not responded to 
comments from these entities regarding the impact the proposal would 
have on their businesses. The commenter asserted that BOEM must include 
a response to written comments in any explanation or discussion 
accompanying the final rule's publication in the Federal Register in 
accordance with the Small Business Jobs Act of 2010. Here, the 
commenter argued that the statutory regime requires BOEM to assess the 
impact of its proposed rule on small businesses.
    Response: The commenter references the Small Business Jobs Act of 
2010; however, the Department assumes they intended to reference the 
Regulatory Flexibility Act, which instructs agencies to assess how 
their proposed regulations will directly affect the entities they 
regulate. The potential indirect effects of existing regulations should 
not be used as the basis to support or reject an agency's current 
proposal. Commenters critical of the proposed rule based on the 
Regulatory Flexibility Act argue

[[Page 42655]]

generally that the proposal either lacks provisions to adequately 
safeguard secondarily affected small entities from baseline activity, 
or that it falls short in doing so. However, they do not specifically 
claim that any of the proposed provisions directly and unnecessarily 
burden small, regulated entities.
    The Department agrees that agencies should consistently monitor 
both the immediate and indirect consequences of its regulatory 
framework on small entities. Yet, the Department should not be 
prevented from implementing necessary changes in some areas simply 
because regulatory improvements might still be available in others.
    Comment: Reasoning that the proposed rule constitutes a major 
Federal action, and that the proposal carries financial risks to public 
interest and potential environmental impacts, a commenter suggested 
that the rule requires assessment under the Congressional Review Act.
    Response: The Congressional Review Act (CRA), 5 U.S.C. 801-808, 
establishes a mechanism to expedite congressional review of agency 
rules. The CRA generally provides that, before a rule may take effect, 
the bureau promulgating the rule must submit a rule report, including a 
copy of the rule, to each House of the Congress and to the Comptroller 
General of the United States (Comptroller General). The CRA applies 
only to final rules, therefore, the NPRM was not submitted to Congress 
or the Comptroller General under the CRA. The final rule will be 
subject to the CRA and the Department will submit a rule report, 
including a copy of the final rule, to each House of Congress and to 
the Comptroller General.
    Comment: A commenter recommended that BOEM maintain the more-
stringent alternative for anticipatory geotechnical investigations, 
which has been removed from the proposed rule. The commenter stated 
this alternative ``retains the requirement for boring at every turbine 
location, while allowing these investigations to occur later in the 
process'' and suggested that the alternative would partially increase 
savings for the lessee or grant-holder, ``but not to the full extent 
that would be saved under the proposed rule.''
    Response: The commenter recommends the retention of the more 
stringent alternative concerning geotechnical borings. This alternative 
retains the requirement for borings at each turbine location but 
proposes to postpone them to a later stage in the process. However, the 
rationale behind the preference for this alternative is not outlined in 
the comment. The Department observes that the proposed rule defaults to 
this approach, and developers seeking greater flexibility must 
demonstrate, subject to bureau approval, the rationale and suitability 
for omitting certain investigations. Further information regarding 
geotechnical and geophysical surveys is elaborated in section 3.3 
above.
    Lastly, the commenter advocates for the agency to continue its 
evaluation of the costs and benefits associated with the rulemaking 
beyond enactment. The Department concurs with the notion that 
regulatory agencies should consistently monitor the effectiveness of 
their regulations and revise them when deemed inadequate or excessively 
burdensome. In fact, this principle underpins the Department's current 
endeavor, which stems from its recognition of substantial enhancements 
attainable through continued scrutiny of its existing regulations.
4. Tribal and Other Government Engagement
    Comment: A commenter stated BOEM's Tribal engagement process has 
fallen short of the requirements in E.O. 13175 as meetings between BOEM 
and the Hoh Tribe and other Tribes have not included BOEM officials 
with Federal decision-making authority. The commenter asserted that all 
OSW development should be immediately halted until BOEM conducts 
meaningful consultation with all affected Tribes. The commenter 
discussed the Treaty of Olympia and the rights afforded to Tribes 
within that Treaty.
    Another commenter asserted that the proposed rule does not 
adequately address the impacts on coastal communities and fisheries, 
thus requiring consultation. The commenter recommended that BOEM use 
this rule to build in additional, meaningful, and more explicit 
triggers for consultation with Indian Tribal Governments. Also, in 
support of incorporating tribal consultation requirements in the rule, 
a commenter said such consultation should be comprehensive and give 
deference to tribal concerns.
    A third commenter asserted that BOEM's leasing process is 
``broken'' and ``needs to be dismantled and rebuilt'' to include 
consultation with Tribes and others.
    Response: The Department agrees that OSW must be developed 
responsibly and in collaboration with potentially affected Tribal 
governments, and through meaningful engagement with local communities, 
and may not come at the expense of treaty rights, resources, and 
cultural practices. The Department is committed to fulfilling the 
Federal tribal trust responsibility, and complying with E.O. 13175, and 
DOI policy and procedures for consulting with Indian Tribes and ANCSA 
Corporations. BOEM invited federally recognized Tribes and ANCSA 
Corporations to consult on the proposed renewable energy modernization 
rule in a Dear Tribal Leader/ANCSA Leader letter dated February 28, 
2023. BOEM met with Tribes who requested government-to-government or 
staff level meetings on the proposed rule.
    In addition to the requirements in E.O. 13175, the Department's 
existing and proposed regulations also require consultation with 
affected Tribes at several points during the OSW leasing process. The 
regulations require Tribal coordination and consultation with the 
Tribal leadership for Tribes that may be affected by any leases, 
easements or ROWs BOEM issues (Sec.  585.102(e)); prior to the issuance 
of any lease (Sec.  585.203); and during the area identification 
process that takes place prior to the competitive issuance of leases 
(Sec.  585.211(b)). The proposed and final rules do not diminish any of 
the Department's coordination or consultation responsibilities with 
Tribes, but rather specifically identify points when coordination and 
consultation is necessary.
    Comment: Some commenters requested consultation with BOEM to 
discuss the proposed rule and expressed disagreement with the statement 
that the rule would not have substantial direct effects on Tribes and, 
therefore, does not require government-to-government consultation. 
Commenters stated they would like to discuss the impact of the rule on 
cultural resources, environmental resources, traditional practices, and 
sacred sites and features of significance to the Tribes; treaty rights, 
resources, and interests, including fishing rights and ecosystems 
impacts that may affect these; and food security, human health, and 
environmental justice.
    Response: The Department strives to strengthen its government-to-
government relationships with American Indian and Alaska Native Tribes 
through a commitment to consultation with those Tribes and recognition 
of their right to self-governance and tribal sovereignty. For 
additional information, see Section H of the preamble.
    BOEM invited federally recognized Tribes and ANCSA Corporations to 
consult on the proposed renewable energy modernization rule in a Dear 
Tribal Leader/ANCSA Leader letter dated February 28, 2023. In response 
to

[[Page 42656]]

requests from Tribal Nations, BOEM held multiple formal government-to-
government consultations with Tribes as well as staff-level information 
sharing meetings with Tribal staff. These consultations and meetings 
included the following:
     Confederated Tribes of Coos, Lower Umpqua Tribe, and 
Siuslaw Indian Tribe (CTCLUSI)--consultation held on May 4, 2023;
     Hoh Indian Tribe--consultation held on June 30, 2023;
     Makah Tribe--consultation held on June 29, 2023, with 
staff-level meetings held on May 17 and June 12, 2023;
     Resighini Rancheria--staff-level meeting held May 24, 
2023; and
     Shinnecock Indian Nation--consultation held on April 17, 
2023.
    The meeting notes from these consultations and staff-level meetings 
are available in the docket (Docket ID. BOEM-2023-0005).
    Comment: A commenter suggested that BOEM consult with Tribes at 
each stage of the OSW leasing and development process prior to making 
any decisions, including reviews of surveys, SAPs, COPs, and other 
decisions. The commenter suggested that BOEM should require bidders to 
consult with Tribes on Tribal concerns to be eligible for the bid 
process and stated that the final rule should include early 
coordination with Tribes, and they ``should not be asked to provide 
comment on a proposed Lease or Permit before we know if there are 
substantial conflicts that need to be assessed prior to identification 
of a Call Area or Wind Energy Area.''
    Response: The current and proposed regulations require the 
Department to consult with affected Tribes at several points during the 
OSW leasing process and the Department welcomes additional tribal 
consultation requests at any time. The regulations require Tribal 
coordination and consultation with the Tribal leadership for Tribes 
that may be affected by any leases, easements, or ROWs BOEM issues 
(Sec.  585.102(e)); prior to the issuance of any lease (Sec.  585.203); 
and during the area identification process that takes place prior to 
the competitive issuance of leases (Sec.  585.211(b)). The Department 
also consults with tribal historic preservation officers pursuant to 
the NHPA.
    Comment: A commenter asserted that BOEM should include in the rule 
a requirement for consultation with the U.S. Fish and Wildlife Service 
and the NMFS under the ESA early in the planning process to eliminate 
or reduce potential harm. The commenter asserted that due to the 
``passage of the right whale extinction rider in the FY23 Omnibus, BOEM 
must reinitiate consultation under the Endangered Species Act'' as this 
rider constitutes new information and may indicate a take of Northern 
Atlantic right whales.
    Response: BOEM does not promulgate regulations regarding endangered 
species, including the North Atlantic right whale. Regulations under 
the Endangered Species Act (ESA) are promulgated by the NMFS and the 
U.S. Fish and Wildlife Service. The text of the 2023 fiscal year 
omnibus spending bill does not implicate the final rule. ESA 
consultation for the promulgation of the final rule is unwarranted 
because the final rule does not authorize any activities and, 
therefore, the Department's action has no effect on threatened or 
endangered species protected by the ESA.
    The Department has and will continue to comply with all applicable 
regulations throughout the entire leasing process, including those 
under the ESA. The promulgation of this final rule does not authorize 
any activities and therefore, the Department's action has no effect on 
threatened or endangered species protected by the ESA. BOEM performs 
the necessary consultations at the lease sale and COP approval stages.
    Comment: A commenter recommended that the rule explicitly require 
consultation with indigenous people (e.g., Native Hawaiians) wherever 
consultation with Federal and State agencies, local governments, 
tribes, and other stakeholders is required.
    Response: BOEM agrees and revised Sec.  585.203 (With whom will 
BOEM consult before issuance of leases?) to include any affected Native 
Hawaiian Community or Alaska Native Corporation. Congress expressly 
requires Federal agencies to consult with the Native Hawaiian Community 
under specific statutes such as the Native American Graves Protection 
and Repatriation Act (NAGPRA) and section 106 of the NHPA, and to 
consult before taking actions that have the potential to significantly 
affect Native Hawaiian resources, rights, or lands. Additionally, in 
October 2022, DOI issued a draft consultation policy (DM part 513 part 
1 and part 2) and announced that it will require formal consultation 
with the Native Hawaiian Community. BOEM is committed to following DOI 
policy on Consultation with the Native Hawaiian Community and will 
follow those draft guidelines.
    Comment: A commenter said that early Federal agency coordination is 
needed for sand resource needs and data. The commenter said that if 
sand resources are to be crossed with offshore export cable corridor's 
the applicant should detail the reasonableness of doing so, and why 
other options are not practical.
    Response: BOEM agrees with the importance of early coordination for 
sand resource needs and data. Sections 585.212 and 585.203 identify 
what is evaluated for the area identification and with whom BOEM will 
consult before the issuance of a lease. These two touchpoints are 
critical for the review of other available offshore resources and the 
potential for avoidance or minimization of impacts to these resources. 
However, BOEM has not finalized additional requirements for lessees 
regarding the reasonableness of crossing sand resources. We believe 
this issue can continue to be addressed without the imposition of 
additional requirements on lessees.
    Comment: A commenter thanked BOEM for proposed modifications that 
would improve Federal and State agency collaboration to ensure that 
regulatory actions affecting coastal resources are conducted according 
to the best available science. However, the commenter expressed concern 
that the proposed rule would diminish the states' role in the NEPA 
process and decrease their ability to conduct efficient and 
comprehensive consistency reviews. The commenter also stated their 
concern for how proposed changes may impact the consideration of 
environmental and coastal resource impacts that must be considered 
under NEPA, and other related laws. A commenter recommended early 
coordination between BOEM, project developers, and the State to 
determine the necessary data and information that would be needed to 
support the Federal consistency determination.
    Response: The NEPA and CZMA roles are two separate processes. The 
requirements under NEPA for public comments provides the states with 
multiple opportunities to request additional information and data be 
analyzed that have been identified through a state's coastal management 
program as necessary data and information. If that information is not 
included in the NEPA document, the Department still has the 
responsibility to ensure this necessary data and information is 
included in the consistency determinations and/or consistency reviews.
    The Department agrees that early and continuous coordination with 
the states and project developers take place throughout the project 
timeframe. Lastly, this final rule does not modify

[[Page 42657]]

the Department's obligations under NEPA and the CZMA.
    Comment: A commenter stated that BOEM has not changed its process 
to increase the assurance of safety or protection of commercial 
fisheries and species in its process, despite concerns from NOAA. The 
commenter expressed opposition to BOEM's deference to developers over 
cooperating agencies in creating a purpose and need statement for NEPA 
review.
    Response: The Department works closely and frequently with NOAA on 
many issues relating to commercial fisheries, marine mammals, and other 
resources. NOAA did not submit comments related to the Department's 
regulations. The comment on the purpose and need statement in 
individual NEPA reviews is outside the scope of this rulemaking. BOEM 
complies with the requirements of NEPA and the CEQ regulations when 
developing a purpose and need statement for NEPA review.
    Comment: A commenter said they would like BOEM to commit to both 
formal and informal consultation with Tribes. Additionally, the 
commenter said that it is important to provide coastal communities with 
a forum to provide input on the proposed rules and proposed development 
activities that the rule would facilitate.
    Response: The current and proposed regulations require Tribal 
consultation at several stages in the OSW leasing process. The 
Department is committed to following DOI policy to consult with Tribes 
for departmental actions with Tribal implications, as well as 
consulting with Tribes as required by statute, such as NEPA and the 
NHPA. The Department consults with Tribes at the Tribal leader and 
staff level and is committed to fulfilling the government's tribal 
trust responsibilities. BOEM initiated and held government-to-
government consultations and staff-level meetings with five Indian 
Tribes to discuss potential impacts and to solicit and fully consider 
their views on the proposed rulemaking. In addition, the Department is 
always open to requested formal consultation and ongoing information 
consultation and dialogue with Tribal nations.
    Comment: A couple of commenters discussed public engagement and the 
renewable energy leasing schedule. A commenter recommended that in 
creating a schedule, BOEM should provide a process to ensure 
stakeholder engagement. A commenter said the renewable energy leasing 
schedule would help inform Tribes and stakeholders of opportunities for 
engagement. The commenter said that more information about OSW 
development processes and formal public comment opportunities could 
improve public knowledge on projects and facilitate deep and meaningful 
engagements.
    Response: BOEM has not included a requirement for a comment period 
prior to publishing the leasing schedule every two years. The leasing 
schedule is meant to shed light on the state of BOEM's current thinking 
rather than being the culmination of a detailed decision-making 
process. Note that areas identified in a leasing schedule will likely 
not see actual development for at least another 10-15 years, during 
which many comment periods, public meetings, consultations, government-
to-government consultations, meetings, publications, studies, plans and 
other activities must take place. The leasing schedule sits at the 
beginning of this process and is intended to let the public know where 
BOEM plans to focus its attention on the consideration of new areas.
    Comment: A commenter said that BOEM needs to clarify when 
engagement with potentially impacted parties is required in the 
noncompetitive leasing process.
    Response: Subsection 8(p)(3) of OCSLA requires BOEM to award leases 
competitively, unless BOEM determines that there is no competitive 
interest. An RFI issued pursuant to Sec.  585.210 of BOEM's existing 
regulations is a preliminary step to assist BOEM in determining 
potential interest in OSW energy development in the RFI Area. At the 
same time, the RFI requests specific and detailed comments from the 
public and other interested or affected parties regarding the features, 
activities, mitigations, or concerns within or around the RFI Area.
    Whether the leasing process is competitive or noncompetitive, BOEM 
includes opportunities for the public to provide input. BOEM must 
comply with all required consultations and environmental analyses 
before issuing a lease noncompetitively, as required by Sec.  585.231. 
Further, BOEM will coordinate and consult, as appropriate, with 
relevant Federal agencies, federally recognized Tribes, affected State 
and local governments, and other affected or interested parties in 
formulating lease terms, conditions, and stipulations.
5. Technical Comments
    Comment: One commenter suggested that BOEM require ``a bond 
sufficient to disassemble and remove any structure or other components 
and restore the offshore area at the end of its useful life, or if the 
impacts to the ocean are significantly adverse, greater than the 
intensity predicted in its analysis, or cannot be otherwise 
mitigated.''
    Response: This comment highlights an important consideration and 
one to which BOEM already dedicates considerable resources. BOEM will 
ensure that its authority is implemented in a way that adequately 
mitigates the risk of stranded OCS assets.
    Comment: A commenter stated that BOEM should revise the definition 
of ``energy product'' in the proposed rule to clarify that the part 585 
regulations are applicable to hydrogen products and that hydrogen 
produced offshore is regulated by BOEM and BSEE, regardless of end use.
    Response: BOEM does consider hydrogen as an ``energy product'' 
potentially subject to BOEM's regulatory oversight. This is consistent 
with the approach that BOEM announced in the preamble to the 2009 
regulations when it said, ``In the future, other types of renewable 
energy projects may be pursued on the OCS, including solar energy and 
hydrogen production projects. These regulations were developed to allow 
for a broad spectrum of renewable energy development without specific 
requirements for each type of energy production.'' 74 FR 19638 at 19646 
(Apr. 29, 2009). BOEM is not revising the definition of ``energy 
product'' in the final rule.
    Comment: A few commenters suggested revisions related to plans. A 
commenter stated that BOEM should include the modifications at Sec.  
585.628(c) related to Federal review periods in the requirements for 
GAPs. A commenter suggested that BOEM include milestones for its COP 
review process and proposed the following milestones:
     BOEM should hold a pre-COP filing meeting to review the 
proposed project and ensure a coordinated review;
     BOEM should include a nominal timeline for its 
determination that a submitted COP is complete and sufficient;
     BOEM should include a nominal timeline for its 
determination that a submitted COP is complete and sufficient;
     BOEM should include a timeline to describe consultation 
with cooperating agencies and outline when alternatives are to be 
analyzed in the NEPA document.
    Response: As the commenters are aware, BOEM recently published 
guidance recommending pre-COP filing meetings between the lessee and 
Federal agencies, including BOEM, and describing milestones leading to 
the determination that a COP is complete

[[Page 42658]]

and sufficient.\17\ Further, BOEM shares the commenter's belief in the 
importance of predictability and reasonable timelines. However, BOEM 
declines to commit by rule to additional timelines, beyond those 
already required by authorities like FAST-41 and the Fiscal 
Responsibility Act of 2023. These laws already impose deadlines and 
scheduling requirements on BOEM and other Federal agencies reviewing 
offshore wind projects, and additional timelines would do little to 
promote the expedited development of OCS resources. BOEM's guidance 
allows for flexibility while also setting out milestones for the 
submission of COPs and an orderly review process.
---------------------------------------------------------------------------

    \17\ See Recommendations for Pre-Notice of Intent (NOI) Federal 
Interagency Engagement on Construction and Operations Plans (COP) 
for Offshore Wind, (Aug. 2023), available at https://www.boem.gov/sites/default/files/documents/renewable-energy/state-activities/BOEM%20NOI%20Checklist.pdf.
---------------------------------------------------------------------------

    Comment: A commenter suggested that BOEM include a provision ``to 
offer lessees conforming amendments to their leases'' after the rule is 
finalized and allow lessees to opt out of some or all proposed changes.
    Response: Existing leases require compliance with BOEM's 
regulations, including ``regulations promulgated thereafter, except to 
the extent that they explicitly conflict with an express provision of 
this lease.'' Accordingly, existing lessees cannot ``opt out'' of 
requirements imposed by later-promulgated regulations. However, 
bilateral lease amendments can be negotiated between BOEM and lessees 
at any time, and BOEM is open to discussing conforming lease amendments 
as suggested by the commenter. For example, to take advantage of 
certain benefits included in these regulations that conflict with 
existing lease provisions. BOEM declines to make such a broad offer of 
conforming edits in the rule itself.
    Comment: A commenter suggested that BOEM define ``competing uses'' 
with an example (offshore sand resources) included in the definition.
    Response: BOEM declines to define the term ``competing uses.'' 
While BOEM agrees that something like offshore sand resources could be 
a use of the OCS that may compete with OSW development (for example in 
export cable siting), the common meaning of the term is not ambiguous, 
and the addition of examples may raise questions about why those 
examples and not others were included.
    Comment: A commenter suggested that BOEM define ``project 
engineer'' in subpart G or remove the term.
    Response: BOEM understands the term ``project engineer'' to be an 
accepted term in the engineering profession for the licensed engineer 
responsible for the design of the project. Without understanding 
further why the commenter thinks that the term is unclear, BOEM 
declines to remove it.
    Comment: Another commenter suggested that BOEM define ``fair return 
to the US taxpayer'' so that the readers know that ``the proposed rule 
would advance the Department of the Interior energy policies in a safe 
and environmentally sound manner that would provide a fair return to 
the U.S. taxpayer.'' The commenter believes the ``the cost of offshore 
wind as part of the fair return calculation'' should include:
    (1) The cost to taxpayers of paying above-market rates for 
electricity from offshore wind.
    (2) The cost to taxpayers of the subsidies for manufacturing 
credits and port facilities to stage construction.
    (3) The cost to taxpayers of additional backup generation (reserve 
margin) that is required when the wind doesn't blow.
    (4) The cost to taxpayers of the additional grid infrastructure and 
transmission lines to connect the geographically spread out offshore 
wind turbines.
    (5) The cost to taxpayers of the 30% ITC provided to the offshore 
wind developers.
    Response: BOEM declines to define ``fair return to the US 
taxpayer'' in this final rule. OCSLA requires that the government 
obtain a ``fair return to the United States for any lease, easement, or 
right-of-way . . .'' The items enumerated in the comment are outside 
the scope of a lease, easement, or right-of-way issued under OCSLA. The 
decision to procure OSW power is made by the purchasers of that 
electricity, in most cases through State legislation, State governors, 
or state regulatory authorities.
    Comment: A commenter recommended that BOEM redefine the term 
``engineered foundation'' as a ``fixed-bottom structure,'' excluding 
equipment like anchors, or remove the term.
    Response: BOEM has removed the defined term ``engineered 
foundation'' from this final rule.
    Comment: A commenter recommended that BOEM revise the description 
of call and area identification consistent with editorial revisions 
that the commenter provided to emphasize that these areas are for 
commercial development and that development of the areas will consider 
potential environmental benefits and potential conflicts.
    Response: BOEM has not followed this recommendation in the final 
rule. BOEM understands the interest in explicitly describing 
consideration of environmental benefits in addition to potential 
conflicts. However, the considerations already listed (e.g., 
environmental factors or characteristics, stakeholder comments, 
industry nominations) provide an opportunity for consideration of both 
benefits and drawbacks of areas under consideration.

IV. Summary of Cost, Economic Impacts, and Additional Analyses 
Conducted

A. What are the affected facilities?

    The rule affects energy companies with OCS renewable energy leases, 
as well as future bidders, applicants, lessees, and grantees. 
(Sec. Sec.  585.107 through 585.113) The impact on existing lessees 
depends in part on whether a regulatory change conflicts with an 
existing lease term. The Department plans to review existing leases for 
possible conflicts with the final regulations promulgated in this final 
rule. Where there is no conflict, the final rule will apply equally to 
existing and future leases. Where conflicts are identified, BOEM may 
offer to lessees a package of lease amendments that would promote 
consistency between existing and future lessees.

B. What are the economic impacts?

    BOEM conducted a Regulatory Impact Analysis, on behalf of the 
Department, to consider the costs and benefits of the rule. Most of the 
revisions in the rule have negligible or no cost impact, while others 
may have second-order benefits that are difficult to quantify. BOEM 
identified four elements of the rule that have quantifiable effects. 
Three of those changes (met buoy requirements, financial assurance, and 
geotechnical survey revisions) provide compliance cost savings and one, 
Safety Management System reporting, has minor compliance cost. In net, 
BOEM estimates these changes could save the OCS renewable energy 
industry approximately $127 million in annualized cost savings over the 
20-year period of analysis (3 percent discounting).

C. What are the benefits?

    This rule provides additional clarity and certainty, while 
streamlining the regulatory framework. The changes from this rule will 
facilitate more expedient and responsible development of offshore 
renewable energy projects. The regulation provides net compliance cost 
savings of approximately $127 million

[[Page 42659]]

in annualized cost savings over the 20-year period of analysis (3 
percent discounting).

D. What Tribal engagement activities were conducted?

    On February 27, 2023, BOEM sent a letter to all federally 
recognized tribes (Tribal Nations) inviting each to government-to-
government consultation on the Renewable Energy Modernization Rule. 
This letter was sent after publication of the NPRM but before the 60-
day public comment period closed. After receiving opposition to the 
determination that the proposed rule would not have substantial direct 
effects on Tribes, BOEM extended the comment period on the NPRM to 
allow more time for consultations and to address Tribal concerns.
    To date, BOEM's Tribal engagements on the NPRM have included 
government-to-government consultations conducted jointly with BSEE and 
staff-level briefings with six Tribal Nations: the Confederated Tribes 
of Coos, Lower Umpqua, and Siuslaw Indians (held May 4, 2023), the Hoh 
Indian Tribe (held June 30, 2023), the Makah Tribe (held May 17, June 
12, and June 29, 2023), the Resighini Rancheria (held May 24, 2023), 
the Shinnecock Indian Nation (held April 17, 2023), and the Mashpee 
Wampanoag Tribe (held March 26, 2024). For more details on these 
engagements, see the Tribal engagement summary memorandum and the 
meeting notes for the engagements in the docket (Docket ID No. BOEM-
2023-0005).
    Several concerns were communicated by the Tribes during the 
consultations. Tribes indicated that the Department should consult with 
Tribes at each stage of the rulemaking process prior to making any 
decisions, requested the development of a programmatic agreement with 
Tribes to address NHPA section 106 obligations, and maintained that the 
Department must require the complete removal of turbines after a wind 
farm ceases to operate. Additionally, Tribes suggested that the 
Department should develop a Programmatic EIS (PEIS) before offshore 
wind development proceeds, that the Department conduct meaningful 
consultation with affected Tribes, and that they have concerns 
regarding lease obligations related to environmental stewardship.
    The Department appreciates the Tribal expertise that has been 
shared and welcomes continued engagement with Tribes after promulgation 
of this rule.

V. Section-by-Section Analysis

    This section-by-section analysis presumes that the reader is 
generally familiar with what was proposed in the NPRM. In most cases, 
therefore, the summary below is focused on the changes that were made 
to the NPRM text as a result of the public comments that were received. 
This section-by-section analysis also generally does not include any 
detailed discussion of the technical changes to the NPRM proposed 
regulations made by the ``Reorganization of Title 30--Renewable Energy 
and Alternative Uses of Existing Facilities on the Outer Continental 
Shelf'' direct final rule (88 FR 6376, January 31, 2023). This direct 
final rule, also known as the Reorganization Rule, describes the 
division of administrative responsibilities between BOEM (parts 585 and 
586) and BSEE (part 285) for the administration of certain regulations 
governing renewable energy development and alternate uses of existing 
facilities on the Outer Continental Shelf. Readers also should be aware 
that some sections of the part 585 regulations have been duplicated and 
included, in whole or in part, in part 285 where appropriate and other 
sections have been partially divided between parts 285 and 585 to 
reflect the assigned responsibilities of each Bureau. BSEE is also 
making minor edits to every section to apply the transfer of authority 
from BOEM to BSEE.

A. 30 CFR Part 285

    Sec.  285.102 What are BSEE's responsibilities under this part?
    Summary of proposed rule provisions: The Department proposed to 
revise Sec.  585.102(a) to authorize renewable energy activities in 
accordance with OCSLA subsection 8(p)(4), as enumerated in Sec.  
585.102(a)(1) through (12). The Department proposed amending this 
regulation to clarify that none of the enumerated requirements are 
intended to outweigh or supplant any other.
    Summary of comments:
    Comment: A commenter discussed the Department's statutory authority 
under OCSLA subsection 8(p)(4) and stated that the proposed rule ``is 
strongly rooted in and supported by Federal case law and the final rule 
should expressly acknowledge that point.'' Further, the commenter 
stated that subsection 8(p)(4) does not require the Department to 
ensure that OCSLA's goals are achieved to a particular degree, but 
instead requires that the Department employ its discretion to achieve a 
balance among the statute's several factors, considering Congress's 
direction to authorize renewable energy development on the OCS, leaving 
``striking the proper balance . . . up to the Secretary of the 
Interior,'' so long as that balance is rational.
    Response: BSEE considered the comment and agrees that BSEE has 
authority under OCSLA subsection 8(p)(4). BSEE determined the existing 
language in 30 CFR part 285 adequately and accurately describes BSEE's 
responsibilities and acknowledges the balance that BSEE is required to 
maintain under OCSLA.
    Summary of final rule revisions: The Department did not finalize 
the proposed language because the existing language in 30 CFR part 285 
adequately and accurately describes BSEE's responsibilities and 
acknowledges the balance that BSEE is required to maintain. The 
Department did not finalize the parts of Sec.  285.102 that were 
reassigned to BOEM's administration under the Reorganization Rule.
    Sec.  285.103 When may BSEE prescribe or approve departures from 
the regulations in this part?
    Summary of proposed rule provisions: The Department proposed to 
modify the Sec.  585.103(a) introductory text and paragraph (a)(1) to 
specify that the Department may prescribe or approve a departure from 
the regulations when the Department deems the departure necessary 
because the applicable provision(s), as applied to a specific 
circumstance, are impractical or unduly burdensome. The Department 
determined that the departure provision was necessary to achieve the 
intended objectives of the renewable energy program and to allow the 
Department the flexibility to adapt the regulations to the unique 
circumstances of this new and evolving industry while retaining the 
consistency and integrity of the regulations as a whole.
    Summary of comments:
    Comment: Commenters suggested that the departure section should 
apply only to ``pre-determined and narrow circumstances.''
    Response: The Department considered the comments and is finalizing 
this section as proposed. Regulations cannot foreseeably address all 
specific scenarios that may arise in practice. Therefore, departures 
are necessary to provide flexibility in unforeseen situations where 
strict application of the regulations would be unfair, impractical, 
unnecessary or even impossible (e.g., unforeseen contradictions in 
regulatory provisions). Applying the departure section to only ``pre-
determined and narrow circumstances'' would risk leaving the bureau and 
the regulated community

[[Page 42660]]

unable to respond to unforeseen circumstances outside such pre-
determined and narrow circumstances.
    Summary of final rule revisions: The Department considered comments 
on the proposed revisions to Sec.  585.103 and is finalizing the 
proposed revisions in Sec.  285.103(a) without change. The revisions 
allow BSEE to prescribe or approve departures from these regulations 
when necessary because the applicable provisions, as applied to a 
specific circumstance: (1) are impractical or unduly burdensome and the 
departure is necessary to achieve the intended objectives of the 
renewable energy program; (2) fail to conserve the natural resources of 
the OCS; (3) fail to protect life (including human and wildlife), 
property, or the marine, coastal, or human environment; or (4) fail to 
protect sites, structures, or objects of historical or archaeological 
significance. No changes were proposed to Sec.  585.103(b), which lists 
additional departure requirements, and no changes were made to Sec.  
285.103(b).
    Sec.  285.105 What are my responsibilities under this part?
    Summary of proposed rule provisions: The Department proposed a 
minor modification to strengthen the requirement for lessees to comply 
with all applicable laws, regulations, other requirements, the terms of 
the lease or grant under this part, reports, notices, approved plans, 
and any conditions imposed by the Department. This was intended to 
expand, strengthen, and clarify the language found in existing Sec.  
585.105(d), requiring compliance only with the ``terms, conditions, and 
provisions of all reports and notices submitted to BOEM, and of all 
plans, revisions, and other BOEM approvals, as provided in this part.''
    Summary of comments: BSEE did not receive any comments regarding 
this section.
    Summary of final rule revisions:
    The Department is finalizing the proposed revisions in the final 
rule at Sec.  285.105 with minor clarifications that the named entities 
must comply with all applicable laws and regulations, the terms of the 
lease or grant under 30 CFR part 585 or 586; reports, notices, and 
approved plans prepared under this part, part 585 or 586; and any 
conditions imposed by BOEM or BSEE through its review of any of these 
reports, notices, and approved plans. The minor clarifications BSEE 
made here are administrative edits to reflect changes resulting from 
the Reorganization Rule.
    Sec.  285.110 How do I submit applications, reports, or notices 
required by this part?
    Summary of proposed rule provisions: The Department proposed 
eliminating its paper copy requirement and relying primarily on 
electronic submissions. The Department proposed to reserve the 
authority to require paper copies of certain documents (such as maps 
and charts) if necessary. The Department also proposed eliminating the 
mailing address to avoid the need for future technical corrections if 
the mailing address changes and, instead, listing the mailing addresses 
for the appropriate contacts on the appropriate website.
    Summary of comments: BSEE did not receive any comments regarding 
this section.
    Summary of final rule revisions: The Department is finalizing the 
proposed revisions in the final rule at Sec.  285.110. BSEE is revising 
Sec. [thinsp]285.110 to require lessees to submit one electronic copy 
of all plans, applications, reports, or notices required by this part 
to BSEE. The revisions also state that BSEE will inform the lessee if 
it requires paper copies of specific documents, and that documents 
should be submitted to the relevant contacts listed on the BSEE 
website.
    BSEE has implemented an electronic submittal system which, except 
for special situations, eliminates the need for paper copies of 
submittals. This minimizes the administrative burden on both the 
industry and the government and ensures the administrative record is 
properly maintained.
    Sec.  285.112 Definitions.
    Summary of proposed rule provisions:
    The Department proposed adding a new definition for ``bidding 
credits.'' Bidding credits are defined as the value assigned by BOEM, 
expressed in monetary terms, to the factors or actions demonstrated, or 
committed to, by a bidder at a BOEM lease auction during the 
competitive lease award process. The regulations further specify that 
the types and values of any bidding credits awarded to any given bidder 
will be set forth in the FSN.
    The Department proposed modifying the definition of ``commercial 
activities'' to state that such activities are conducted ``under'' 
leases and grants. This modification was intended to maintain 
consistency with the proposed revisions to Sec.  585.104 by clarifying 
that site assessment activities that are not conducted on a commercial 
lease (and thus do not require a lease) would be excluded from the 
definition of ``commercial activities.''
    The Department proposed modifying the definition of ``commercial 
operations'' to state that the term means the generation of electricity 
or other energy product for commercial use, sale, and distribution on a 
commercial lease, but does not mean either generation needed to prepare 
a final FIR or generation for testing purposes, provided the 
electricity generated for such testing is not sold on a commercial 
basis.
    The Department proposed adding a new definition for ``Critical 
Safety Systems and Equipment'' to mean safety systems and equipment 
designed to prevent or ameliorate major accidents that could result in 
harm to health, safety, or the environment associated with the lessee's 
or grant holder's facilities.
    The Department proposed adding a definition for the term 
``engineered foundation,'' which would mean any structure installed on 
the seabed using a fixed-bottom foundation constructed according to a 
professional engineering design based on an assessment of sedimentary, 
meteorological, or oceanographic conditions.
    The Department also proposed adding a definition for the term 
``fabrication'' which would mean the cutting, fitting, welding, or 
other assembly of project elements of a custom design conforming to 
project-specific requirements.
    The Department proposed adding definitions for the terms ``lease 
area'' and ``provisional winner'' to provide clarity in the regulatory 
text. Lease area is an OCS area identified by BOEM for potential 
development of renewable energy resources. The provisional winner is 
the bidder that BOEM determines at the conclusion of the auction to 
have submitted the highest bid. The Department proposed redefining the 
provisional winner to be the winning bidder upon favorable completion 
of the government's post-auction reviews.
    The Department proposed adding a new definition of ``multiple 
factor auction,'' which would be defined to mean an auction that 
involves the use of bidding credits to incentivize goals or actions 
that support public policy objectives or maximize public benefits 
through the competitive leasing auction process. For all multiple 
factor auctions, the Department proposed adding the monetary value of 
the bidding credits to the value of the cash bid to determine the 
highest bidder.
    The Department proposed clarifying that ``receipt'' of a document 
as having been deemed to take place, in the absence of documentation to 
the contrary, (a) 5-business days after the document was given to a 
mail or delivery service with the proper address and postage; or (b) on 
the date the document was sent electronically.

[[Page 42661]]

    Finally, the Department proposed a technical correction to the 
definition of ``site assessment activities'' to avoid possible 
confusion with site characterization activities.
    Summary of comments:
    Comment: A commenter recommended that the Department delete the 
definition of ``engineered foundation'' from Sec.  585.600(a)(1) to 
avoid confusion, given that it only applies to met towers and no other 
structures.
    Response: BOEM removed the term ``engineered foundation'' from 
Sec.  585.600(a)(1). BSEE agrees with this approach, given that the 
term ``engineered foundation'' was intended to be used only in the SAP 
provisions of the rule and, therefore, the Department is not adding the 
definition to Sec.  285.112 since the term is no longer used.
    Comment: A commenter suggested that the Department explicitly 
define ``installation'' and ``commissioning'' similar to the definition 
of ``fabrication'' and explain in more detail what is included in 
Critical Safety Systems and Equipment to better define what is required 
to be verified by a CVA.
    Response: BSEE disagrees with the comment because the terms 
``installation'' and ``commissioning'' are commonly used and understood 
terms. BSEE did add additional language to the definition of Critical 
Safety Systems and Equipment to clarify that these devices could be a 
single piece of equipment or a system and to align more closely with 
OCSLA.
    BSEE did not specify the exact ``Critical Safety Systems and 
Equipment'' because of the rapid pace of technology development and 
differences in systems and equipment between projects. Instead, 
Critical Safety Systems and Equipment must be identified on a project 
basis through the risk assessment process that is overseen by the CVA.
    Comment: A commenter stated that the proposed definition of 
``commercial operations'' should be formulated through collaboration 
between BOEM and BSEE, grid operators, and project developers to avoid 
technical risks between commissioning and start of operations.
    Response: The Department considered all comments on ``commercial 
operations'' provided in response to the proposed rule and the 
Department is not finalizing the proposed language ``does not mean 
either generation needed to prepare a final FIR or generation for 
testing purposes, provided the electricity generated for such testing 
is not sold on a commercial basis'' because this is a requirement that 
should not be included as part of a definition. BSEE removed the 
requirements from the definition of commercial operations and added 
them to Sec.  285.637. BSEE is adding ``transmission'' to the list of 
operations. BSEE has had discussions with several interested parties 
concerning commercial operations departure requests. BSEE did not 
conduct additional collaboration outside of the proposed rule process.
    Comment: Commenters suggested that the Department make the 
following revisions: (1) Modify the rule to remove the use of the term 
``type-certified'' as it is unclear what stage of type certification is 
needed before permission is granted or include ``type-certified'' as a 
definition in the final rule; (2) Alternatively, introduce a definition 
in Sec.  585.112 of type-certified to clarify what is meant by this 
term. In that case, include that when used in these rules, type-
certified may describe components that are provisionally certified or 
components that are in the process of type certification, so long as 
the type certification is in place at time of final manufacturing.
    Response: BSEE has revised the proposed language based on the 
comment. Type-certified has been removed from the definition of 
fabrication but remains in the Sec.  285.700 regulation to explain that 
a type-certified component may be procured prior to FDR and FIR non-
objection.
    Comment: A commenter expressed support for the proposed 
modifications to the rule define ``fabrication'' as ``cutting, fitting, 
welding or other assembly or project elements of custom design 
conforming to project specific requirements'' and excluding from the 
definition the procurement of discrete parts of the project that are 
commercially available in standardized form.
    Response: BSEE modified the proposed definition of fabrication to 
state that, ``Fabrication means the cutting, fitting, welding, or other 
assembly of project elements.'' The exclusions previously proposed in 
the definition are now in the regulations at Sec.  285.700 but were not 
appropriate for a definition.
    Summary of final rule revisions:
    Based on comments received and BSEE's experience since the 
Reorganization Rule publication, the Department is revising the 
definitions in this section to provide clarity and consistency and to 
ensure alignment with BOEM's definitions in 30 CFR part 585. The 
Department is revising the definitions of ``commercial activities'', 
``commercial operations,'' ``decommissioning,'' and ``site assessment 
activities,'' and adding definitions for ``Critical Safety Systems and 
Equipment,'' ``fabrication,'' and ``project design envelope'' to 30 CFR 
part 285.
    BSEE is making changes to the definition of commercial activities 
to maintain consistency with BOEM. The final rule modifies the 
definition of ``commercial activities'' to state that such activities 
are conducted ``under'' leases and grants rather than ``for'' them. 
This clarifies that commercial activities as defined in the rule only 
apply to on-lease or on-grant activities, and not off-lease or off-
grant activities by commercial lessees and grantees.
    For the definition of ``commercial operations,'' the Department is 
not finalizing the proposed language ``does not mean either generation 
needed to prepare a final FIR or generation for testing purposes, 
provided the electricity generated for such testing is not sold on a 
commercial basis'' and is adding ``transmission'' to the list of 
operations. This revision provides clarification of and consistency 
with BSEE expectations of commercial operations according to Sec.  
285.637.
    The Department is adding the definition of ``Critical Safety 
Systems and Equipment'' to part 285 to clarify the threshold for 
systems and equipment to be considered critical for ensuring safety. 
The Department is revising the proposed rule language by adding ``and 
equipment'' to the term and adding fires and spillages to the list of 
incidents covered by the term. The Department revised the term to 
include ``and equipment'' because a single piece of equipment or a 
system consisting of several pieces of equipment functioning together 
may be used to prevent or ameliorate fires, spillages, or other major 
accidents that could result in harm to health, safety, or the 
environment. The additional revision provides clarity to ensure that 
major accidents including fire and spillages are included and covered 
by these systems or equipment and meets the threshold set by OCSLA.
    The Department is incorporating the existing definition of 
``decommissioning'' in to Sec.  285.112 and is removing the reference 
to 30 CFR part 585 to reflect changes in the Reorganization Rule.
    The Department is adding a definition for ``fabrication'' to part 
285. BSEE modified the definition for ``fabrication'' from the proposed 
rule to ``the cutting, fitting, welding, or other assembly of project 
elements.'' BSEE removed the exclusion from custom designs and 
standardized forms or type-certified

[[Page 42662]]

components from the definition of ``fabrication.'' The exclusion from 
fabrication requirements for custom designs and standardized forms or 
type-certified components and from fabrication not on the OCS is part 
of the regulatory text in Sec.  285.700, which accomplishes the same 
goal without putting the exception in the definition.
    Additionally, the Department includes in the final rule the 
definitions of ``project design envelope'' and ``site assessment 
activities,'' as proposed in the NPRM at Sec.  585.112, without change.
    The definitions for ``bidding credits,'' ``lease area,'' ``multiple 
factor auction,'' ``provisional winner,'' and ``receipt'' proposed in 
the NPRM at Sec.  585.112 are not finalized in part 285 of this rule. 
These terms are not used in 30 CFR part 285 and, therefore, do not need 
to be defined therein. The definition for ``engineered foundation'' was 
proposed in the NPRM to apply to the SAP provisions of the regulations 
but BSEE did not add it here because, as commenters noted, it had the 
potential to cause confusion within the final rule.
    Sec.  285.113 How will data and information obtained by BSEE under 
this part be disclosed to the public?
    Summary of proposed rule provisions: The Department proposed a 
technical change, substituting the word ``operations'' for 
``generation'' in paragraph (b)(1), so that the Department's review of 
the data and information would be done ``3 years after the initiation 
of commercial operations . . . ,'' to provide greater consistency with 
the remainder of the Department's offshore renewable regulations.
    Summary of comments: BSEE did not receive any comments regarding 
this section.
    Summary of final rule revisions: BSEE is revising paragraph (b)(1) 
to replace ``initiation'' with ``commencement,'' and finalizing the use 
of the term ``commercial operations'' in Sec.  285.113, as proposed in 
the NPRM consistent with the revisions in Sec.  585.114. These are 
editorial changes made to be consistent with the rest of the 
regulations.
    Sec.  285.114 Paperwork Reduction Act statements--information 
collection.
    Summary of proposed rule provisions: The Department proposed 
updating the table in this section to align with proposed regulations.
    Summary of comments: BSEE did not receive any comments regarding 
this section.
    Summary of final rule revisions: BSEE is not finalizing the 
proposed revision to Sec.  285.114 and is keeping the provision in the 
existing regulations. This section in the existing regulations already 
reflects the current OMB control numbers recently covered by the 
Reorganization Rule.
    Sec.  285.116 Requests for information on the state of the offshore 
renewable energy industry.
    Summary of proposed rule provisions: The Department proposed 
combining requests for interest and requests for information in a 
revised Sec.  585.116 and naming them requests for information. The 
proposed rule suggested eliminating the request for interest as a step 
in the leasing process. The Department proposed that, in the event that 
BOEM wanted to start the leasing process with a solicitation of 
information from the public, the more general request for information 
under Sec.  585.116 would be available to serve that purpose.
    Summary of comments: BSEE did not receive any comments regarding 
this section.
    Summary of final rule revisions: BSEE finalized the language 
proposed in Sec.  285.116(a) in the NPRM to be consistent with the 
proposed Sec.  585.116(a). BSEE made minor, non-substantive changes, 
such as removing ``(a)'' and making the regulation one paragraph 
because BSEE is not including proposed paragraphs (b), (c), and (d) in 
this section as those provisions pertain to leasing administration, 
which BSEE does not administer.
    Sec.  285.117 Severability.
    Summary of proposed rule provisions: Section 285.117 is a new 
regulation being added in this final rule and that was not included in 
the proposed rule.
    Summary of comments: BSEE did not receive any comments regarding 
this section.
    Summary of final rule revisions: The Department's existing 
regulations in this subpart did not contain a severability provision 
nor did the Department propose one in the NPRM. However, in this final 
rule, the Department has included a severability provision in new Sec.  
285.117 as follows: ``If a court holds any provisions of this subpart 
or their applicability to any persons or circumstances invalid, the 
remainder of the provisions and their applicability to any persons or 
circumstances will not be affected.'' While the Department has 
determined that all of the sections of this subpart and part 585 in 
this final rule can and do function separately, the Department 
understands that a court will ultimately determine whether portions of 
the rule can be severed from others. In the event a court determines a 
provision was improperly promulgated, this section is designed to aid 
that review by demonstrating that the Department intends the various 
components of this final rule, with various provenances and independent 
functions, to continue to operate even if one or more of the provisions 
is declared unlawful.
    Sec.  285.118 What are my appeal rights?
    Summary of proposed rule provisions: The Department proposed 
combining Sec. Sec.  585.118 and 585.225 by locating all procedures for 
review of BOEM renewable energy final decisions or orders in a revised 
Sec.  585.118. The purpose of this revised section was to maintain the 
distinction between requesting reconsideration of rejected bids and 
appeals of other final decisions made under part 585 but revise the 
regulation to characterize challenges to decisions selecting 
provisional winners as appeals to the Director, rather than requests 
for reconsideration.
    In the proposed rule, the Department suggested providing appeal 
rights to any adversely affected bidder of a provisional winner 
selection decision. The proposed section would also provide provisional 
winners an opportunity to appeal if they determined there have been any 
errors or omissions in the selection decision, such as miscalculated or 
unapplied bidding credits.
    This proposed section suggested that BOEM must receive written 
appeals of a decision selecting the provisional winner within 15-
business days after a bidder receives notice of the decision. The 
proposed section suggested adopting the rules found in the appeal 
procedures at 30 CFR 590.3 for determining when a selection decision is 
received.
    Finally, the proposed section suggested clarifying two points 
regarding an appeal of a decision selecting the provisional winner. 
First, the provisional winner would have an opportunity to be heard 
before the BOEM Director reverses a selection decision. Second, the 
Director's decision would not be appealable administratively to the 
Interior Board of Land Appeals.
    Summary of comments: BSEE did not receive any comments regarding 
this section.
    Summary of final rule revisions: The Department reviewed proposed 
Sec.  585.118 and is finalizing the proposed language in Sec.  285.118, 
with revisions to paragraphs (a) and (b) to reflect changes made in the 
Reorganization Rule, to clarify the rights to appeal. The regulation 
addresses a party's right to appeal a final decision issued by BSEE to 
the Interior Board of Land Appeals

[[Page 42663]]

(IBLA), and that any BSEE final decision will remain in full force and 
effect while the appeal is pending. BSEE is not including proposed 
paragraph (c) in this section because those provisions pertain to 
leasing, which is not administered by BSEE.
    Sec.  285.400 What happens if I fail to comply with this part?
    Summary of proposed rule provisions: The Department proposed 
amending this section to ensure that its civil penalty authority for 
OCS renewable energy activities addresses a more complete range of 
violations and is coextensive with the authority that Congress granted 
to it in OCSLA. The Department proposed adding a new paragraph (f)(2) 
to address certain situations, such as civil penalties for violations 
that constitute, or constituted, a threat of serious, irreparable, or 
immediate harm, and to allow the Department to take appropriate action 
by assessing civil penalties in the event that a lessee or operator 
commits such failures.
    Summary of comments:
    Comment: One commenter requested that BSEE ensure that civil 
penalties are reserved for the most serious circumstances. However, 
another commenter requested that the Department ``take steps to ensure 
that the penalty is reserved for truly serious circumstances and 
require agency notice at some reasonable time after the assessment of 
the civil penalty and prior to the accrual of any interest.'' Another 
comment requested that BOEM and BSEE should ``commit to developing and 
applying consistent precedent and interpretations in all areas of 
shared responsibility'' to ``ensure that BSEE and BOEM do not take 
different views of when specific conduct or circumstances constitute a 
violation.''
    Response: BSEE has not made changes to the finalized language based 
on these comments because OCSLA establishes which violations warrant 
civil penalty consideration and the language of the regulation tracks 
the language of the statute. BSEE may assess a civil penalty if a 
lessee does not correct a violation or if the violation posed a threat 
or harm to safety or the environment. The maximum civil penalty is set 
by law, but BSEE determines the amount for a specific violation based 
on its severity, duration, and other factors. Lessees have the right to 
request informal resolution of the decision from the Bureau and to file 
an appeal with the Interior Board of Land Appeals. BSEE and BOEM are 
committed to managing shared responsibilities through cooperation and 
communication in the implementation and administration of their 
authorities.
    Summary of final rule revisions: BSEE considered comments on the 
corresponding proposed revisions to Sec.  585.400 and is finalizing the 
proposed language, with revisions to paragraphs (f)(1) and (2) to 
reflect the Reorganization Rule and ensure consistency with OCSLA. 
These administrative changes clarify BSEE's authority to assess civil 
penalties if a lessee fails to comply with any provision of this part, 
or any term of a lease, grant, or order issued under the authority of 
this part. BSEE may assess the civil penalty after providing the lessee 
notice of such failure and the expiration of a reasonable period to 
correct the failure, or if BSEE determines that the failure constitutes 
a threat of serious, irreparable, or immediate harm or damage to life, 
property, or the marine, coastal, or human environment.
    Sec.  285.415 What is a lease or grant suspension?
    Summary of proposed rule provisions: The Department proposed to 
replace the word ``term'' with ``period'' in light of its proposed 
changes to Sec.  585.235.
    Summary of comments: BSEE did not receive any comments regarding 
this section.
    Summary of final rule revisions: BSEE is finalizing paragraph (b) 
in Sec.  285.415, consistent with proposed Sec.  585.415, to clarify 
that a suspension extends the expiration date for the relevant period 
of your lease or grant for the length of time the suspension is in 
effect.
    Sec.  285.417 When may BSEE order a suspension?
    Summary of proposed rule provisions: The Department proposed to 
eliminate the paper copy requirement for this regulation, consistent 
with its proposed changes to Sec.  585.110.
    Summary of comments:
    Comment: BOEM [and BSEE] exceeded its statutory authority by making 
substantive changes to the statutory criteria for lease suspension and 
cancellation. Therefore, the commenter said the modernization rule 
should include regulatory changes to correct differences between the 
current regulatory criteria for lease suspension (Sec.  285.417) and 
cancellation (Sec. Sec.  585.422(b)(4) and 285.437(b)(4)) and the 
statutory (OCSLA) criteria.
    Response: This rulemaking is not proposing to make changes to 
BSEE's suspension or cancellation authority because we view them as 
consistent with OCSLA. In the Energy Policy Act of 2005 (EPAct), 
Congress authorized the Secretary of the Interior (Secretary) to 
establish a program for renewable energy activities on the OCS and to 
promulgate any necessary regulations to carry out that program. 
Specifically, the EPAct amended OCSLA to add subsection 8(p) (43 U.S.C. 
1337(p)). Subsection 8(p) grants the Secretary the authority to issue 
leases, easements, and ROWs on the OCS for activities that produce or 
support the production, transportation, storage, or transmission of 
energy from sources other than oil and gas, or that use existing OCS 
facilities for energy- or marine-related purposes that are not 
otherwise authorized by OCSLA or other laws.
    Summary of final rule revisions: BSEE is revising paragraph (b)(2) 
of Sec.  285.417, consistent with the proposed Sec.  585.417, to 
require a lessee to provide an electronic copy of the study and results 
to BSEE pursuant to Sec.  285.110. This revision will help ensure that 
BSEE receives the data in electronic format to facilitate appropriate 
review and streamline submittal. BSEE is also making an 
administratively corresponding edit to reflect the applicability of 
this part to BSEE instead of BOEM as identified in the Reorganization 
Rule.
    Sec.  285.420 What effect does a suspension order have on my 
payments?
    Summary of proposed rule provisions: The Department proposed 
combining paragraphs (b) and (c) of Sec.  585.420 to modify the 
requirement that directed suspensions will always be accompanied by a 
fee suspension. As a result of this proposal, all payment suspensions 
would be at BOEM's discretion. The Department also proposed clarifying 
that, regardless of whether a lease or grant suspension is approved or 
ordered, BOEM would have discretion to ``waive or defer'' (rather than 
``suspend'') payments while the lease or grant is suspended.
    Summary of comments: BSEE did not receive any comments regarding 
this section.
    Summary of final rule revisions: The Department reviewed proposed 
section Sec.  585.420 and is finalizing this section in Sec.  285.420 
to clarify, in light of the Reorganization Rule, that if BSEE orders a 
suspension pursuant to Sec.  285.417, then BOEM may waive or defer a 
lessee's payment obligations during the suspension. Additionally, BOEM 
may decide to waive or defer the payment obligation based, in part, on 
the reasons for the suspension and the lessee's responsibility for the 
circumstances that necessitated the suspension. These changes were made 
to maintain consistency with the regulations in part 585 and to provide 
the same flexibility when either BSEE or BOEM orders a suspension.

[[Page 42664]]

    Sec.  285.602 What records must I maintain?
    Summary of proposed rule provisions: The Department proposed 
expanding the recordkeeping requirements to require lessees and grant 
holders to retain records relating to lease or grant compliance, 
including SMS requirements.
    Summary of comments: BSEE did not receive any comments regarding 
this section.
    Summary of final rule revisions: The Department is finalizing the 
language that it proposed in Sec.  585.602, with administrative 
revisions, to clarify that a lessee must maintain and provide to BSEE, 
upon request, all data and information related to compliance with the 
required terms and conditions of its lease, grant, reports submitted 
under this part, and approved plan until BOEM releases the lessee's 
financial assurance under Sec.  585.534. This revision, which is now in 
Sec.  285.602, will help ensure BSEE receives or has access to 
compliance information for all of the applicable operations and 
activities. BSEE is making administrative corresponding edits to 
reflect the applicability of this part to BSEE instead of BOEM as 
identified in the Reorganization Rule.
    Sec.  285.614 When may I begin conducting activities under my 
approved SAP?
    Summary of proposed rule provisions: The Department proposed 
revising paragraph (b) by adding the word ``description'' after Safety 
Management System to clarify that it is a description of the Safety 
Management System that must be submitted, in conformance with the 
requirements outlined in Sec.  585.810.
    Summary of comments: BSEE did not receive any comments regarding 
this section.
    Summary of final rule revisions: BSEE is revising paragraph (b) of 
Sec.  285.614, consistent with the proposed Sec.  585.614, to clarify 
that a lessee must comply with the requirements of subpart G of this 
part and submit its SMS description as required by Sec.  285.810 before 
construction may begin if the lessee is installing a facility or a 
combination of facilities deemed by BOEM to be complex or significant.
    Sec.  285.637 When may I commence commercial operations on my 
commercial lease?
    Summary of proposed rule provisions:
    The Department proposed moving existing Sec.  585.708(a)(5)(ii) 
into Sec.  585.637 and changing ``certification'' to ``verification'' 
to maintain consistency with other provisions of the proposed rule. The 
Department also proposed clarifying that commercial operations may 
commence 30-calendar days after the Department deems submitted--rather 
than receives--the final project verification report as described in 
proposed Sec. Sec.  585.704 and 585.708(a)(5), provided that the 
Department has not notified you within that time frame of any 
objections to the verification report and that the Department has 
confirmed receipt of critical safety systems commissioning records, as 
described in Sec.  585.708(a)(6). The Department proposed revising 
Sec.  585.713 by moving the requirement to notify the Department within 
10-business days of starting commercial operations into Sec.  585.637.
    The Department also proposed revising the definition of 
``commercial operations'' to clarify that the generation of electricity 
needed for the preparation of the final FIR or the generation of 
electricity for testing purposes would be excluded from the definition, 
provided that such electricity is not sold on a commercial basis.
    Summary of comments:
    Comment: A commenter suggested revising this section to allow 
lessees to produce and sell power prior to final FIR non-objection.
    Response: BSEE agrees with the commenter and is revising this 
section to require that lessees and CVAs submit information to 
demonstrate that facilities installed prior to first producing 
commercial power have been fabricated and installed and that Critical 
Safety Systems and Equipment have been commissioned properly. The 
lessee may continue to keep producing so long as the lessee and CVA 
continue to submit information demonstrating the additional facilities 
been fabricated and installed and that Critical Safety Systems and 
Equipment have been commissioned properly as they come online. This 
addresses industry concerns about increased fatigue on the facilities 
if they are shut down for extended periods of time and concerns about 
the ability to meet power purchase agreements while balancing the need 
for BSEE to ensure the safe operation of facilities on the OCS.
    Comment: A commenter requested clarification on what is to be 
included in the proposed PVR and when it should be submitted for 
commercial operations to commence and suggested that CVAs be required 
to provide a Project Certification Close-out Report within 18 months of 
commercial operations.
    Response: BSEE did not create a project certification closeout 
report to be submitted within 18 months of commercial operations, 
because some projects, especially large projects, may not have 
completed installation of all their facilities within 18 months of 
commercial operations. BSEE may consider this comment if it is within 
the scope of future rulemakings. BSEE is updating Sec.  285.637 to 
allow for power to be produced so long as lessees can demonstrate and 
continue to demonstrate that their facilities were designed, 
fabricated, installed, and commissioned properly to protect life and 
the environment. This update addresses industry concerns about 
increased fatigue on the facilities if they are shut down for extended 
periods of time and concerns about the ability to meet power purchase 
agreements while balancing the need for BSEE to ensure the safe 
operation of facilities on the OCS. The contents of the project 
verification report and submission requirements are described in Sec.  
285.708.
    Comment: A commenter requested that BSEE refine the definition to 
allow lessees to produce and ``commercially sell test power produced 
prior to the FIR non-objection.'' The commenter asserted that this 
change would reduce tension in the electricity market rules and prevent 
developers from defaulting on contractual commitments. The commenter 
also requested clarification in the final rule that ``commercial 
operations'' does not include energy produced after commissioning and 
testing but prior to the commencement of such operations. The commenter 
asserted that requiring developers to cease generation during the FIR 
review could cause damage to turbines, would be unproductive, and would 
reduce the fair return to taxpayers.
    Response: BSEE has addressed the concern over commercial operations 
in Sec.  285.637. The regulation has been revised to allow lessees to 
produce and sell power prior to final FIR non-objection. The lessees 
and CVAs must submit information to demonstrate that facilities 
installed prior to first producing commercial power have been 
fabricated and installed and that Critical Safety Systems and Equipment 
have been commissioned properly. The lessee may continue to produce as 
long as the lessee and CVA continue to submit information demonstrating 
the additional facilities have been fabricated and installed and that 
Critical Safety Systems and Equipment have been commissioned properly 
as the facilities come online. Commercial operations begin the first 
time the project generates electricity or other energy product for 
commercial use, sale, or transmission or distribution from a commercial 
lease.
    BSEE also revised Sec.  285.637(a)(1) through (4) and (b) to allow 
for power to be produced so long as lessees can

[[Page 42665]]

demonstrate and continue to demonstrate that their facilities were 
designed, fabricated, installed, and commissioned properly to protect 
life and the environment. BSEE revised this regulation because it 
recognizes that allowing the turbines to spin minimizes fatigue on the 
turbine and allowing power to be produced to the grid minimizes 
negative impacts to power purchase agreements.
    Summary of final rule revisions:
    BSEE considered comments on the corresponding proposed revisions to 
Sec.  585.637 and is finalizing the proposed language in Sec.  285.637, 
with revisions to paragraphs (a)(1) through (4), (b), and (c) based on 
the comments. Paragraphs (a)(1) through (4) address when a lessee may 
commence commercial operations if the lessee is conducting activities 
on its lease that do not require a FERC license. Under revised 
paragraph (a), a lessee may commence commercial operations after the 
following have occurred:
    (1) the lessee has submitted information consistent with Sec.  
285.702(c) and (d) for facilities installed prior to commencing 
commercial operations;
    (2) the CVA has submitted their PVR, as described in Sec.  
285.708(a)(5) including information required by Sec.  285.708 (b)(1), 
or interim report(s), as described in Sec.  285.712(a), for facilities 
installed prior to commencing commercial operations;
    (3) the CVA has submitted their Critical Safety Systems and 
Equipment commissioning records, as described in Sec.  
[thinsp]285.708(a)(6), or interim report(s), as described in Sec.  
285.712(a); and
    (4) BSEE has not notified the lessee of any objections to the 
submittals in paragraphs (a)(1) and (a)(3) of this section within the 
timeframes in Sec. Sec.  285.700(d) and 285.712(a), as applicable.
    Paragraph (b) allows a lessee to continue commercial operations as 
additional facilities complete commissioning if the lessee has 
submitted the information required by paragraphs (a)(1) and (3) of this 
section for facilities installed after commercial operations have 
commenced. Lastly, paragraph (c) requires a lessee to notify BSEE 
within 10 business days after it has commenced commercial operations.
    The result of the revisions to Sec.  285.637 is that the lessee can 
continue to produce electricity, which also minimizes fatigue on the 
turbines, provided that BSEE continues to receive information 
demonstrating that the facilities were fabricated, installed, and 
commissioned properly.
    Sec.  285.638 What must I do upon completion of my commercial 
operations as approved in my COP or FERC license?
    Summary of proposed rule provisions: The Department proposed 
revising Sec.  585.638(a) to remove references to Sec. Sec.  285.905 
and 285.906.
    Summary of comments: BSEE did not receive any comments regarding 
this section.
    Summary of final rule revisions: The Department is finalizing the 
first sentence of paragraph (a) in Sec.  285.638, consistent with 
proposed Sec.  585.638, to require an operator to decommission its 
project as set forth in subpart I of this part upon completion of its 
approved activities under its COP.
    Sec.  285.700 What reports must I submit to BSEE before installing 
facilities described in my approved SAP, COP, or GAP?
    Summary of proposed rule provisions:
    The Department proposed clarifying its authority to allow lessees 
to submit their FDRs and FIRs for review by major component, so long as 
the lessee explains how all the major components will function together 
in an integrated manner in accordance with the project design and the 
integration is verified by a CVA. The Department also proposed 
clarifying that FDRs and FIRs may be submitted before or after SAP, 
COP, or GAP approval, though the Department's 60-day review period will 
not start until the report is deemed submitted and the plan is 
approved.
    The Department also proposed revising Sec.  585.700 by adding new 
paragraphs (b) and (c), and redesignating paragraphs (b) and (c) as 
paragraphs (d) and (f). The Department proposed revisions to the 
language in paragraph (b) of the existing regulations (redesignated as 
paragraph (d)), and to add a new paragraph (e). Paragraph (d) clarifies 
that FDRs and FIRs may be submitted before or after SAP, COP, or GAP 
approval, though the Department's 60-day review period will not start 
until the report is deemed submitted and the plan is approved. 
Fabrication and installation activities on the OCS may only commence 
once a lessee or grant holder has received the Department's non-
objection to the FDR and FIR or if no objections were made by the end 
of the Department's 60-day review. Proposed new paragraph (e) clarifies 
that (1) the procurement of discrete parts of the project that are 
commercially available in standardized form and type-certified 
components, or fabrication activities that do not take place on the 
OCS, may commence prior to the submittal of the FDR and FIR or any 
plans required under the Department's regulations; and (2) any 
procurement or fabrication of facility components prior to the 
Department's non-objection to the FDR and FIR, or the end of the 
Department's 60-day review without objections, is subject to 
verification by the CVA and to possible objection by the Department 
prior to the installation of said components on the OCS.
    Finally, the Department proposed to revise existing paragraph (c) 
and redesignate it as paragraph (f), to clarify that it has 60 calendar 
days to object to an FDR or FIR or to request additional information.
    Summary of comments:
    Comment: Commenters suggested that the terms ``verification'' and 
``certification'' are not consistently defined across published 
standards.
    Response: BSEE agrees and, after considering various relevant 
standards and references, is revising these terms as defined in the 
Oxford Dictionary and contextual usage in relevant standards. The terms 
``certify'' or ``certification'' describes how the CVA ``recognizes 
that (someone or something) possesses certain qualifications or meets 
certain standards.'' BSEE may require a CVA to ``certify'' that a 
design or safety component conforms to a defined certification protocol 
based on criteria from specific quality assurance standards or 
recognized accepted engineering practices. The terms ``verify'' or 
``verification'' describes how the CVA demonstrates that something is 
true, accurate, or justified. BSEE has evaluated each of the CVAs 
actions, as required by the regulations, and updated the regulations to 
use the appropriate term.
    Comment: Commenters suggested allowing a staged submittal of the 
FDR and FIR. A few commenters stated that the proposal provides 
improved clarity and flexibility to sequence the submittal to match the 
fabrication schedule and reduces burden on the regulator and project. A 
commenter suggested that the Department specifically state that FDRs 
and FIRs may be organized and submitted by Tier 1 components such as 
Wind Turbine Generator, Wind Turbine Tower, Wind Turbine foundation 
structure inclusive of all substructures and appurtenances, Inter-array 
cables, Offshore Substation topsides, Offshore substation foundation 
structure inclusive of all substructures & appurtenances, and Export 
cables.
    Response: BSEE agrees and is finalizing the proposed language of 
this section to allow and encourage separate FDR/FIR submittals of 
integrated asset packages for added flexibility per Sec.  285.700(b).
    Comment: A commenter suggested amendments to Sec.  585.700(c) to

[[Page 42666]]

incentivize a submittal for an early review before the COP approval. 
This early review of the FDR and FIR for completeness would create 
efficiencies in the BSEE engineering review and facilitate BSEE's 
ability to complete its review within the 60-day period. The commenter 
stated that this is critical for facilitating development post-COP 
approval, as every day counts where developers are rapidly mobilizing 
toward the commencement of offshore construction while making major 
capital expenditures.
    Response: BSEE disagrees with the suggestion to incentivize a 
submittal for an early review before the COP approval. FDRs and FIRs 
cannot be deemed submitted prior to approval of the COP, SAP, or GAP. 
BSEE must ensure that the FDR and FIR remain within PDE, which is not 
possible until plan approval.
    BSEE is finalizing text proposed in Sec.  585.700(e), now in Sec.  
285.700(e), to clarify that procurement of discrete parts of the 
project, which are commercially available in standardized form or type-
certified components may take place prior to submittal of an FDR or 
FIR. Also, fabrication activities that do not take place on the OCS 
(e.g., manufacturing) may take place prior to the submittal of an FDR 
or FIR. However, the developer assumes the risk that BSEE may not allow 
equipment procured or fabricated prior to BSEE not objecting to the FDR 
and FIR to be installed on the OCS. Procurement of discrete parts of 
the project or onshore fabrication that begins prior to FDR or FIR is 
still subject to CVA verification and may not be accepted later by 
BSEE.
    Comment: A commenter disagreed with the Department's proposed 
changes, stating that these modifications degrade the EIS process by 
allowing significant investment by energy development companies before 
the Department can provide decisions on projects, which could lead to 
conflicts of interest.
    Response: BSEE disagrees with the commenter and is not revising the 
rule based on this comment. The EIS is developed by BOEM, as the lead 
Federal agency, not by an applicant. Likewise, the decision whether to 
approve a project proposal described in a COP is a Federal decision 
delegated to BOEM, not the applicant. BOEM and BSEE adhere to the NEPA 
requirements at 40 CFR 1506.1(b) that limit actions within the agency's 
jurisdiction during the review of an application from a non-Federal 
entity and the concurrent NEPA process. Investment decisions by energy 
development companies described by the commenter--such as investments 
to other onshore infrastructure, to reserve manufacturing slots, or to 
reserve vessels and equipment--are not within either bureau's 
jurisdiction. Companies can choose to wait until BOEM completes the EIS 
and issues a COP approval and/or until BSEE completes its review of the 
FDR and FIR and does not object before making any significant 
investments in procurement or fabrication. Procurement of discrete 
parts of the project or onshore fabrication that begins is still 
subject to CVA verification, which includes ensuring the facilities are 
within what was approved in the COP, SAP, or GAP and the FDR, and may 
not be accepted later by BSEE.
    Comment: Commenters suggested that the Department make the 
following revisions: (1) modify the rule to remove the use of the term 
``type-certified'' as it is unclear what stage of type certification is 
needed before permission is granted or include ``type-certified'' as a 
definition in the final rule; (2) alternatively, introduce a definition 
in Sec.  585.112 of type-certified to clarify what is meant by this 
term. In that case, include that when used in these rules, type-
certified may describe components that are provisionally certified or 
components that are in the process of type certification, so long as 
the type certification is in place at time of final manufacturing; and 
(3) simplify the approach by stating that the regulations impose no 
restrictions on fabrication or procurement that does not occur on the 
OCS.
    Response: BSEE has revised the proposed language based on the 
comment. Type-certified has been removed from the definition of 
fabrication but remains in the Sec.  285.700 regulation to explain that 
a type-certified component may be procured prior to FDR and FIR non-
objection. However, the developer assumes the risk that BSEE may not 
allow equipment procured or fabricated prior to BSEE not objecting to 
the FDR and FIR to be installed on the OCS. Any procurement or onshore 
fabrication that begins prior to FDR or FIR is still subject to CVA 
verification and may not be accepted later by BSEE. In this case, type-
certified means a full type-certification issued by an accredited type-
certifier. Type certification is process that is well understood and 
using the word ``type certified'' instead of ``provisional type 
certification'' clearly means that the full type certification has been 
achieved. BSEE disagrees with the commenter's assertion of no 
restrictions on fabrication and has not made any changes to reflect 
this comment. There are important restrictions on fabrication and 
procurement in that anything fabricated or procured prior to non-
objection of the FDR and FIR is done at the developers own risk as 
explained above.
    Comment: Several commenters suggested changes that would enable the 
Department to approve separate FDRs and FIRs for major project 
components. The commenters stated that these changes would encourage 
developers to seek CVA review throughout their project design process 
and would permit the use of specialized CVAs to verify specific project 
components.
    Response: The comments support the changes that BSEE has already 
made. BSEE already allows and encourages separate FDR and FIR 
submittals of integrated asset packages to allow for flexibility 
pursuant to Sec.  285.700(b).
    Comment: Another commenter expressed support for the proposed 
modifications to the rule as it would allow for staged data submittal, 
remove existing requirements that a lessee or grant holder begin to 
fabricate and install only after the Department has notified the lessee 
or grant holder that it has received the FDR and FIR and that it has no 
objections, and define ``fabrication'' as ``cutting, fitting, welding 
or other assembly or project elements of custom design conforming to 
project specific requirements'' and excluding from the definition the 
procurement of discrete parts of the project that are commercially 
available in standardized form.
    Response: The comment supports what the Department proposed and is 
finalizing. BSEE is allowing staged submittal of FDRs and FIRs based on 
integrated asset packages. BSEE still must review and not issue an 
objection to both the FDR and FIR for an integrated asset package 
before offshore fabrication or installation may begin. BSEE is also 
clarifying that procurement of discrete parts of the project, which are 
commercially available in standardized form or type-certified 
components may take place prior to submittal of an FDR or FIR. Also, 
fabrication activities that do not take place on the OCS (e.g., 
manufacturing) may take place prior to the submittal of an FDR or FIR. 
However, the developer assumes the risk that BSEE may not allow 
equipment procured or fabricated prior to BSEE not objecting to the FDR 
and FIR to be installed on the OCS. Any procurement or onshore 
fabrication that begins is still subject to CVA verification and may 
not be accepted later by BSEE. BSEE also modified the definition of 
fabrication to state that, ``Fabrication means the cutting, fitting, 
welding, or other assembly of project

[[Page 42667]]

elements.'' The exclusions previously proposed in the definition are 
now in the regulations at Sec.  285.700 but were not appropriate for a 
definition.
    Comment: A commenter suggested allowing offshore work to occur 
within 60 days of notification of objection and removing the language 
regarding additional requests for information in Sec.  585.700(f). The 
term ``objection'' is not a defined term, so it allows the Department 
to determine what necessitates an objection, which could be the request 
for additional information.
    Response: BSEE disagrees with the suggestion of a 60-day time 
period. A lessee must resolve all objections before work may begin; the 
timeframe for when offshore work may begin after notification of an 
objection is dependent upon when sufficient information is sent to BSEE 
to resolve the objection. If there are unresolved information needs, 
BSEE will object. BSEE agrees with the commenter regarding removing 
``requires additional information'' from Sec.  285.700(f) and has done 
so in the final rule. BSEE will object if there are unresolved 
information needs.
    Comment: A commenter suggested including both ``iFIR'' and ``fFIR'' 
to reference initial and final FIRs.
    Response: BSEE did not implement the commenter's suggestion and did 
not include ``iFIR'' and ``fFIR'' as acronyms in the final rule. BSEE 
will continue to use the acronym ``FIR'' and the phrase ``final 
Fabrication and Installation Report'' because it sufficiently 
distinguishes the two types of reports. BSEE will consider updating 
this in future rulemakings.
    Comment: A commenter requested clarification on the meaning of 
``accepted industry or engineering standards'' in the reporting 
requirements before installation in Sec.  585.700(e).
    Response: Acceptable industry standards include national or 
international standards that are fit for use in the United States OCS. 
BSEE, in conjunction with the CVA, reviews the proposed industry 
standards for use as part of the review process. BSEE did not make a 
change to the proposed rule based on the comment.
    Summary of final rule revisions:
    The Department is finalizing the language in Sec.  285.700, as was 
proposed Sec.  585.700, with clarifying revisions. Paragraph (a) 
requires lessees to submit an FDR and FIR before installing facilities 
in their approved COP, and, when applicable, their approved SAP or GAP. 
Paragraph (b) allows lessees to submit separate FDR(s) and FIR(s) for 
integrated asset packages and requires the FDR(s) and FIR(s) for 
integrated asset package to be complete along with an explanation of 
how the FDR or FIR will function effectively in an integrated manner 
and a CVA verification of such integration. Paragraph (c) allows 
lessees to submit their FDRs and FIRs before or after SAP, COP, or GAP 
approval. Paragraph (d) allows lessees to commence fabrication and 
installation of facilities, subject to the requirements in paragraph 
(b), when (1) BSEE deems the lessee's report submitted before SAP, COP, 
or GAP approval and notifies the lessee of its non-objection to the FDR 
and FIR or does not respond within 60 business days of SAP, COP, or GAP 
approval, or (2) BSEE deems the lessee's report submitted after SAP, 
COP, or GAP approval and notifies the lessee of its non-objection to 
the FDR and FIR or does not respond with objections within 60 business 
days of the report being deemed submitted.
    Paragraph (e) allows lessees to commence procurement of discrete 
parts of the project that are commercially available in standardized 
form and type-certified components, or fabrication activities that do 
not take place on the OCS, prior to submitting the reports required 
under paragraph (a) subject to CVA verification and certification. BSEE 
retains authority to object to the installation of said components if 
certain conditions are not met. The Department proposed changing the 
word ``certification'' to ``verification'' in paragraph (e). After 
review of comments and careful consideration, BSEE determined that 
components fabricated before BSEE does not object to the FDR and or FIR 
are subject to CVA verification and certification as required by 
Sec. Sec.  285.701-285.714.
    Under paragraph (f), BSEE will notify a lessee in writing within 60 
business days of the report being deemed submitted if BSEE has an 
objection(s). A lessee cannot commence fabrication or installation 
activities on the OCS until all objections in such reports are resolved 
to BSEE's satisfaction.
    Within this provision, BSEE is clarifying that the 60-day FDR and 
FIR review period in the existing regulation is 60 business days. BSEE 
determined that a 60-business day review period, rather than the 
proposed 60-calendar day review period, is necessary to ensure that 
BSEE has sufficient time to review these complicated and lengthy 
technical documents.
    BSEE responded to comments concerning separating FDR(s) and FIR(s) 
into integrated asset packages in Section III, D. above. Additional 
comments and responses regarding this provision are provided below.
    Sec.  285.701 What must I include in my Facility Design Report?
    Summary of proposed rule provisions:
    The Department proposed replacing the requirements for floating 
turbines in the existing paragraph (b) with a reworded requirement in 
proposed paragraph (a)(6). The Department proposed that the FDR include 
the results of any detailed geotechnical surveys that were deferred as 
a result of proposed Sec.  585.626(b)(1)(iii). Similarly, the 
Department proposed that the FDR include the results of any 
archaeological surveys that were deferred on a case-by-case basis under 
proposed Sec.  585.626(b)(3). The Department proposed adding a 
requirement in new paragraph (a)(12) for the lessee to include design 
standards in the FIR. Also, the Department proposed a new requirement 
in paragraph (a)(13) for the lessee to include information on critical 
safety systems, including a risk assessment that identifies the 
critical safety systems and a description of the identified critical 
safety systems.
    Finally, the Department proposed a catch-all category to cover 
necessary project-specific information that may not be contained within 
the listed categories. The Department also proposed to eliminate the 
third column of the table in paragraph (a) as superfluous, given the 
Department's proposed elimination of the paper copy requirement and to 
replace that column's content with a new paragraph (b) consistent with 
the proposed Sec.  585.110.
    The remaining proposed changes were technical corrections and 
included: removal of the word ``proposed'' from the project easement 
requirement in paragraph (a)(2)(iii) because the project easement would 
be approved already at the time of FDR review; substitution of 
``verification'' for ``certification'' in the description of the CVA's 
duties in addition to the CVA verification statement that the facility 
has been designed to provide for safety, in keeping with other proposed 
changes in Sec.  285.701(d); and removal of the trade secrets provision 
in existing paragraph (e) as redundant of Sec.  285.113.
    Summary of comments:
    Comment: A commenter supported moving geotechnical data to the FDR. 
Other commenters opposed moving the geotechnical data to the FDR 
because of how it may impact the Department's environmental analysis.
    Response: Both BOEM and BSEE revised proposed amendments to the 
survey data requirements in the final rule and narrowed them to apply 
only

[[Page 42668]]

to geotechnical survey data that are used for engineering purposes. 
Geophysical and some geotechnical data that is needed for BOEM to 
conduct their environmental analysis will still be submitted for the 
COP. The geotechnical data submitted with the FDR will be used for the 
site-specific engineering design.
    BSEE finalized moving reports and supporting data from geotechnical 
surveys, in situ explorations, laboratory tests, analyses, burial or 
drivability assessments, and recommended design parameters to Sec.  
285.701(a)(10).
    Comment: Another commenter suggested that, although the proposed 
rule change in Sec.  585.701(a) allows the lessee to propose 
respectively design and fabrication standards specific to the project, 
the proposed change does not present an acceptance criterion, 
evaluation process definition, or the methodology used on the 
validation of the proposed standards for the application. The commenter 
recommended that the Department add language defining the acceptance 
process to provide clarity to the regulation.
    Response: Nationally and internationally recognized standards 
included in the FDR and FIR are reviewed for design applicability and 
conformance by the CVA and BSEE SMEs. The FDR and FIR should clearly 
demonstrate the required performance criteria can be met and where the 
standards were used to support the engineering design, accordingly, 
BSEE has determined that additional clarity in the regulation is not 
necessary.
    Comment: Several commenters also suggested that the final rule 
provide more flexibility than the proposed rule by stating that data 
submitted after the COP approval is not required for the Facility 
Design Report (FDR)/Facility and Installation Report (FIR) to avoid 
delays in completion of the FDR/FIR process within 60 days.
    Response: BSEE and BOEM determined that the amount of flexibility 
proposed and incorporated into the final rule achieves the appropriate 
balance between efficiency and the need to review site-specific 
engineering design information. Site-specific geotechnical survey data 
must be included in the FDR/FIR. The existing requirement to submit 
site-specific geotechnical data at the COP stage under Sec.  585.626(a) 
is being modified by both agencies, as proposed. BSEE and BOEM are 
relocating review of this site-specific data from Sec.  585.626(a) to 
Sec.  285.701(a). Moving this review from the COP to the FDR provides 
efficiencies by aligning the information needs for site specific 
information at the FDR with the requirements for the geotechnical 
information. Geotechnical data not submitted in the COP is critical for 
the site-specific engineering design and is therefore necessary in the 
FDR to ensure the design is appropriate for the location in which it 
will be installed.
    Comment: A commenter requested additional guidance on how a CVA may 
verify safety and suggested that a ``design-basis'' approach as 
described in BOEM's 2020 COP Guidelines Attachment C could be applied. 
Another commenter suggested that Sec.  585.701(a)(13) should be revised 
to ``(i) A risk assessment that identifies the Critical Safety Systems 
and Equipment with the exception of critical safety systems that are 
incorporated in type approved components or facilities. (ii) A 
description of the identified critical safety systems.''
    Response: BSEE considered this comment but determined that the FDR 
must contain site-specific engineering designs supported by codes and 
standards, making a ``design-basis'' approach inappropriate. BSEE did 
not make changes to the final regulation to incorporate a ``design-
basis'' approach.
    BSEE also did not change Sec.  285.701 to exclude critical safety 
systems that are incorporated in type-approved components or 
facilities. In order to ensure the safety of workers on the OCS, BSEE 
needs to understand all the critical safety systems and equipment on 
the facilities, even if part of type-approved components. BSEE requires 
that the FDR include a risk assessment that identifies hazards and 
mitigations, which includes critical safety systems and equipment. Risk 
assessment results should be integrated into the design, such that the 
identified hazards have been reduced to an acceptable level of risk. No 
change was made based on this comment.
    Comment: A commenter expressed support for the submittal of certain 
archaeological surveys with the FDR, stating that this would allow 
flexibility and would allow lessees to tailor the survey program and 
would reduce the number of surveys and reduce vessel time in the water 
and associated environmental impacts. The commenter also requested that 
the Department not extend engagement throughout the design process to 
address stakeholder preferences.
    Response: BSEE disagrees with the commenter's request to allow 
lessees to postpone archaeological surveys to the FDR. The Department 
received many comments opposing this, and the Department's subject 
matter experts confirmed that not receiving full geophysical analysis 
until the FDR would complicate BOEM's environmental reviews and 
consultations. Upon review of the comments the Department determined 
that all archaeological surveys will be required at the COP stage and 
the proposed change to allow lessees to postpone archaeological 
resources reports to the FDR was not finalized in Sec.  285.701(a) of 
the final rule.
    Comment: A commenter expressed disagreement with the note in the 
proposed rule suggesting that delayed archaeological surveys could 
lengthen the NHPA section 106 review process. The commenter asserted 
that the proposed rule is in line with industry standards and suggested 
that the Department clarify in the final rule whether any supporting 
documentation would be required to get a survey strategy approved under 
the performance-based standard.
    Response: The Department's NPRM Sec.  585.626(b)(3) stated that 
``[o]n a case-by-case basis and subject to terms and conditions of COP 
approval per Sec.  585.628(f), BOEM may permit you to submit certain 
surveys of the subsea portions of the area of potential effects with 
your FDR per Sec.  585.701(a)(11).'' Upon consideration of comments 
received, the Department is eliminating this language. The Department 
agrees that sufficient geophysical data is necessary to assess 
potential impacts from offshore wind activities on cultural resources 
and the introduction of a case-by-case deferral of certain marine 
archaeological surveys could create uncertainty for some parties 
participating in consultations conducted according to section 106 of 
the NHPA. BSEE has removed the referenced regulatory text in Sec.  
585.701(a) from the finalized language in Sec.  285.701(a).
    Comment: Another commenter stated that, although the proposed 
change to Sec.  585.701(a) would allow the lessee to propose design and 
fabrication standards specific to the project, the change does not 
present an acceptance criterion, evaluation process definition, or the 
methodology used on the validation of the proposed standards for the 
application. The commenter recommended that the Department define the 
acceptance process to provide clarity to the regulation.
    Response: The Department is finalizing as proposed the flexibility 
for proposing standards. The CVA and BSEE subject matter experts review 
the national and international standards included in the FDR for design 
applicability and conformance. The FDR should clearly demonstrate that 
the

[[Page 42669]]

required performance criteria can be met and where the standards were 
applied to support the engineering design.
    BSEE declined to add specific criteria as industry standards are 
changing and still being developed, especially U.S.-specific standards. 
The CVA must review and agree that the standards are appropriate. BSEE 
must have a chance to review the standards also.
    Comment: A commenter expressed concern that the definition of 
``critical safety systems'' is too vague and suggested several changes 
to FDRs and FIRs to alleviate those concerns. Additionally, the 
commenter requested that the Department clarify the content required 
for FDRs and FIRs, and the approval process for separately submitted 
FDRs and FIRs.
    Response: Because technologies are constantly changing, BSEE has 
determined that maintaining flexibility by requiring lessees to 
identify Critical Safety Systems and Equipment on a project basis 
through a risk assessment process is needed. Accordingly, BSEE has not 
made any changes to the definition of ``Critical Safety Systems and 
Equipment'' in Sec.  285.112 in response to this comment. The CVA must 
oversee the risk assessment and associated results. Sections 285.701 
and 285.702 clearly lay out BSEE's expectations for the content of the 
FDR and FIR, respectively. The approval process for separate FDRs and 
FIRs is the same as for a single FDR and FIR.
    Comment: A commenter requested that the Department revise 
Sec. Sec.  585.701(a)(12) and 585.105 to require only the most relevant 
industry standards that apply to the project be submitted in the FDR 
and FIR. The commenter also suggested BSEE should remain the authority 
to determine if a sufficient level of detail is covered in the 
submitted standards.
    Response: BSEE is not revising Sec.  285.701 to require only the 
most relevant industry standards because ``most relevant'' is an 
ambiguous term. BSEE will consider updates to standards requirements in 
future rulemakings.
    Comment: A commenter stated that there is ambiguity in the content 
required in the FDR and FIR and suggests that the Department remove the 
requirement that CVA's must conduct independent assessments of other 
pertinent parameters of proposed designs.
    Response: BSEE provides the requirements of what must be included 
in an FDR in Sec.  285.701 and in an FIR in Sec.  285.702. Designs are 
constantly changing so the need to require an ``independent assessment 
of other pertinent parameters of proposed designs'' is necessary to 
ensure there is sufficient information to verify the safety of the 
proposed design.
    Comment: A commenter suggested deleting ``catch-all'' provisions in 
the list of FDR and FIR content requirements Sec. Sec.  585.701(a)(14) 
and 585.702(a)(10).
    Response: The provisions list a requirement to include other 
information in Sec. Sec.  285.701(a)(13) and 285.702(a)(10) because 
technologies are constantly changing and BSEE must be able to request 
information to verify the safety of the proposed design. Accordingly, 
BSEE is not deleting these provisions.
    Summary of final rule revisions:
    The Department is finalizing the language in proposed Sec.  
585.701, including revisions to paragraphs (a)(1) through (10); the 
addition of paragraphs (a)(11) through (13); and removal of paragraph 
(e). BSEE is revising paragraphs (a)(4), (6), and (9) to include 
``tendon''. The revisions address how the design report demonstrates 
that the design conforms to key responsibilities listed in Sec.  
285.105(a) and the required documents in the report; require submission 
of an FDR to BSEE pursuant to Sec.  285.110 and identification of the 
location of records; and include a certification statement with 
accompanying justification in the FDR if the lessee is required to use 
a CVA.
    BSEE is not finalizing the removal of the reference to the U.S. 
Coast Guard for structural integrity and stability in paragraph (b).
    Geotechnical information, previously submitted as part of the COP, 
is revised to be submitted as part of the FDR pursuant to Sec.  
285.700(a)(10). The Department proposed to change the term 
``certified'' to ``verified'' in paragraph (d). BSEE determined that 
certified is the proper term in this regulation as certified describes 
how the CVA ``recognizes that (someone or something) possesses certain 
qualifications or meets certain standards.'' See Sec.  285.700 above 
for a more detailed discussion of the use of the words 
``certification'' and ``verification.''
    BSEE responded to comments concerning FDR(s) and FIR(s) in Section 
III, D. above. Additional comments and responses regarding this 
provision are provided below.
    The provisions in this final rule do not change or purport to 
change any other Federal agencies' regulatory requirements, including 
the USCG's regulations governing integrity and stability of floating 
facilities.
    Sec.  285.702 What must I include in my Fabrication and 
Installation Report?
    Summary of proposed rule provisions: The Department proposed adding 
a requirement in proposed paragraph (a)(6) that lessees and grant 
holders submit any certificates documenting that they are adhering to a 
recognized quality assurance standard. The Department also proposed to 
clarify that any environmental information contained in a previously 
submitted corresponding plan may be incorporated by reference in an FIR 
to the extent that information satisfies the requirements of proposed 
paragraphs (a)(7)(i) through (iv). The Department also proposed to add 
a requirement in paragraph (a)(8) for the submittal of commissioning 
procedures for critical safety systems. The Department also proposed to 
eliminate the third column of the table in paragraph (a) as superfluous 
given the Department's proposed elimination of the paper copy 
requirement and to replace that column's content with a new paragraph 
(b) consistent with the proposed Sec.  585.110. The proposed paragraph 
(c) would provide clarity and add flexibility regarding project 
easement information submittals and requests. Finally, as with its 
proposed changes to the FDR requirements in Sec.  585.701, the 
Department proposed a catch-all category for necessary project-specific 
information that may not be covered by the listed categories.
    Summary of comments:
    Comment: A commenter suggested that the Department revise Sec.  
585.702(a)(3) from ``The industry standards you will use to [. . .]'' 
to ``A listing of the most relevant industry standards you will use to 
[. . .].''
    Response: BSEE is not revising Sec.  285.702 to require only the 
most relevant industry standards because ``most relevant'' is ambiguous 
and does not provide the regulated community with sufficient certainty 
and clarity.
    Comment: A commenter requested that language be amended in Sec.  
585.702(a)(8) to remove ``other BOEM approved procedures'' to improve 
clarity.
    Response: BSEE agreed with the commenter that improved clarity was 
necessary but implemented the edits differently than the commenter 
proposed. BSEE revised Sec.  285.702(a)(8) from ``other BOEM approved 
procedures'' to ``other BSEE accepted engineering practices.'' BSEE 
made this revision to allow not only the use of OEM procedures, but 
also other procedures that have been developed by a qualified 
individual for the specific equipment in the specific location where it 
will be used or installed.

[[Page 42670]]

    Comment: A commenter suggested removing requests for project 
easements submitted as part of the FIR as they are pursuant to the COP 
approval and not relevant to request at the FIR stage.
    Response: BSEE has removed requests for project easements submitted 
as part of the FDR from its regulations. BOEM has jurisdiction over the 
issuance of project easements.
    Comment: A commenter suggested allowing flexibility in the final 
rule for commissioning procedures and documentation to be reviewed in 
the execution phase and submitted as part of the FIR rather than 
requiring commissioning documentation with the FIR.
    Response: BSEE is not making a revision to the final rule based on 
this comment because there is currently no report during the execution 
phase where BSEE could move this requirement. The commissioning 
procedures remain part of the FIR review, but BSEE will consider this 
in future rulemakings. Information on the commissioning of the Critical 
Safety Systems and Equipment must be submitted after commissioning 
takes place.
    Summary of final rule revisions:
    The Department is finalizing this regulation, consistent with 
proposed Sec.  585.702. BSEE is revising paragraphs (a)(1) through (7); 
removing the existing paragraph (d); redesignating existing paragraphs 
(b) and (c) as paragraphs (c) and (d), respectively; adding paragraphs 
(a)(8) through (10) and (b); and revising the newly redesignated 
paragraph (d). The revisions add new required documents in the 
fabrication and installation report, including quality assurance 
information in paragraph (a)(6), commissioning procedures for Critical 
Safety Systems and Equipment in paragraph (a)(8), and other information 
in paragraph (a)(10). BSEE also made administrative edits to new 
paragraph (b) about requiring lessees to submit their FIR to BSEE 
pursuant to Sec.  [thinsp]285.110; redesignated paragraph (c) about 
providing the location of records, as required in Sec.  285.714(c); and 
to redesignated paragraph (d) about including a certification statement 
with accompanying justification in the FIR if the lessee is required to 
use a CVA.
    Paragraph (c), as proposed in the NPRM, was removed because 
requests for project easements must be submitted to BOEM and not as a 
part of the FIR.
    The NPRM proposed to replace the term ``certified'' with 
``verified'' in redesignated paragraph (d). After review of comments 
and careful consideration, BSEE determined that the term ``certified'' 
is the proper term in this regulation because certified describes how 
the CVA ``recognizes that (someone or something) possesses certain 
qualifications or meets certain standards.''
    BSEE removed the trade secrets provision in existing paragraph (d) 
as redundant of Sec.  285.113.
    BSEE responded to comments concerning FDR(s) and FIR(s) in Section 
III, D. above. Additional comments and responses regarding this 
provision are provided below.
    Sec.  285.703 What reports must I submit for project modifications 
and repairs?
    Summary of proposed rule provisions:
    The Department proposed to eliminate language in paragraph (a) 
indicating that major repairs or modifications must be ``certified,'' 
consistent with the proposed changes to Sec. Sec.  585.701 and 585.702. 
The Department proposed that any major modification or repair report 
contain a CVA verification statement analogous to the one required for 
FDRs in Sec.  585.701 and for FIRs in Sec.  585.702. The Department 
also proposed to clarify the definition of a ``major repair'' in 
paragraph (a)(1) to include substantial repairs to critical safety 
systems and the definition of a ``major modification'' in paragraph 
(a)(2) to include a substantial alteration of a critical safety system.
    The Department proposed to determine the completeness of the 
application before its review period begins. The proposed rule provided 
that the Department will have 20-calendar days to make this 
determination. The Department proposed to add this regulation to 
clarify that the reports (e.g., FDR, FIR, and project verification 
reports) must be deemed submitted before the 60-calendar day or 30-
calendar day review period begins.
    Summary of comments:
    Comment: A commenter suggested that Sec.  585.703(a) should clarify 
that ``major repairs and major modifications'' refer to project 
modifications post-installation.
    Response: BSEE agrees that project repair and project modification 
reports are intended to apply to major post-installation repairs and 
modifications. BSEE has internal procedures to review modifications 
during FDR or FIR review and prior to facility installation outside of 
Sec.  285.703(a), which are communicated to the lessee as applicable. 
BSEE is not making any revisions to the final rule based on this 
comment but may consider updates in future rulemakings.
    Comment: A commenter requested that the Department further define 
the extent of what is considered ``substantial'' in Sec.  585.703(a)(1) 
and (2).
    Response: BSEE is declining to make a specific definition of 
``substantial'' in this regulation but may consider this in future 
rulemaking.
    Summary of final rule revisions:
    The Department is finalizing paragraphs (a) and (c), consistent 
with proposed Sec.  585.703. The revisions in paragraph (a) require a 
lessee to submit to BSEE a Project Modification or Repair Report, in 
which it certifies that major repairs and major modifications to a 
completed project conform to accepted engineering practices. The 
definitions of the terms ``major repair'' and ``major modification'' 
are also revised to include ``substantial repair'' and ``substantial 
alteration'', respectively.
    The NPRM proposed to replace the term ``certified'' with 
``verified'' in paragraph (c). After review of comments and careful 
consideration, BSEE determined that the term ``certified'' is the 
proper term in this regulation because certified describes how the CVA 
``recognizes that (someone or something) possesses certain 
qualifications or meets certain standards.''
    Sec.  285.704 After receiving the FDR, FIR, or project verification 
reports, what will BSEE do?
    Summary of proposed rule provisions: Over the past few years, BOEM 
received numerous incomplete COPs and other documents that it could not 
properly evaluate. This created many issues between the lessees and 
BOEM with respect to the status of the applications. To address this, 
the Department proposed making a determination as to the completeness 
of the application before its review period begins. The proposed rule 
provided that the Department will have 20-calendar days to make this 
determination. The Department proposed making a determination that if 
any given report is sufficiently accurate and complete, it would deem 
it submitted, which would begin the applicable period of time for the 
Department to review and object, as necessary. The Department proposed 
to add this regulation to clarify that the reports (e.g., FDR, FIR, and 
project verification reports) must be deemed submitted before the 60-
calendar day or 30-calendar day review period begins.
    Summary of comments:
    Comment: A commenter suggested that the Department remove the 20-
day limit for a completeness review of the FDR, FIR, and PVR as the 
Department already reserves the right to pause the review period if the 
report is incomplete.
    Response: FDR and FIR packages can include hundreds of documents. 
Adequate time is needed to ensure the

[[Page 42671]]

packages are complete to decrease the likelihood of an objection at the 
end of the review period due to missing or incomplete information.
    Comment: A commenter requested clarification on how the 
completeness review differs from the formal review, particularly 
related to the non-objection periods and if they can overlap.
    Response: BSEE conducts a completeness review to ensure that the 
bureau has all the information needed prior to beginning its official 
review. The purpose of the completeness review is to prevent objections 
based on missing or incomplete information. The completeness review and 
formal review periods cannot overlap.
    Comment: A commenter suggested revising the final rule to state 
that ``FDRs and FIRs could be deemed submitted by BOEM before SAP COP 
or GAP approval if submitted more than 20 calendar days prior to SAP 
COP or GAP approval.''
    Response: FDRs and FIRs cannot be deemed submitted prior to 
approval of the COP, SAP, or GAP. BSEE must ensure that the FDR and FIR 
remain within the PDE, which is not possible until plan approval.
    Comment: A commenter requested clarification on the requirements 
for PVR submission being ``deemed submitted,'' which the commenter 
asserted conflicts with the regulation that allows developers to 
commence operations after the Department receives the PVR. The 
commenter also requested clarity on if Critical Safety Systems 
commissioning records only require confirmation of receipt rather than 
being ``deemed submitted.''
    Response: BSEE revised Sec.  285.637 so that a final PVR is not 
required to be submitted before commercial operations. The PVR will be 
deemed submitted once BSEE determines the PVR is sufficiently complete 
and accurate pursuant to Sec.  285.704. Commissioning records do not 
need to be ``deemed submitted.''
    Summary of final rule revisions: The Department is finalizing this 
regulation, consistent with proposed Sec.  585.704, with revisions, to 
address what BSEE will do to (1) determine whether the FDR, FIR, or 
project verification report is deemed submitted (paragraph (a)); (2) 
identify problems and deficiencies in the reports (paragraph (b)); and 
(3) notify a lessee that a report is deemed submitted (paragraph (c)). 
BSEE revised the timeframes in the proposed rule from 20 calendar days 
to 20 business days for when BSEE deems a report submitted or notifies 
a lessee of problems or deficiencies. BSEE determined that a 20-
business day review period, rather than the proposed 20-calendar day 
review period, is necessary to ensure that BSEE has sufficient time to 
review these highly complex and lengthy technical documents. BSEE has 
at times received over 700 documents for a single FDR or FIR.
    Sec.  285.705 When must I use a Certified Verification Agent (CVA)?
    Summary of proposed rule provisions: The Department proposed 
allowing the use of multiple CVAs on a project in paragraph (a). The 
Department also proposed several modifications, clarifications, and 
technical corrections to this section. First, the Department proposed 
adding a requirement in paragraph (b) for the CVA to ensure critical 
safety systems are commissioned in accordance with the procedures 
identified in the FIR. Second, the Department proposed clarifying in 
paragraph (a) that the CVA requirement applies unless it is waived 
under paragraph (c) of this section. Third, the Department proposed in 
paragraph (c) to clarify that, just as multiple CVAs may be nominated 
for different project elements, the Department may grant partial 
waivers of the CVA requirement for discrete elements of a project. 
Fourth, in paragraph (c) the proposed rule substituted ``fabricator' 
and ``fabricated'' for ``manufacturer'' and ``manufactured'', 
respectively, to avoid confusion and maintain consistency with Sec.  
585.700. Fifth, in paragraph (c) the proposed rule added a requirement 
that fabrications, repairs, or modifications that are the subject of a 
CVA waiver nonetheless must adhere to a recognized quality assurance 
standard. Sixth, the proposed rule eliminated the requirement that 
waiver requests be submitted with plans, thus relieving the Department 
of the obligation to consider such waiver requests as part of its plan 
reviews. Finally, the proposed rule replaced the term ``certify'' with 
``verify'' in paragraph (a).
    Summary of comments:
    Comment: Several commenters disagreed with the proposed changes to 
the CVA requirements because they determined the changes may lead to a 
reduction in safety and recommended that the Department carefully 
consider possible concerns about impacts to mariners. A commenter 
opposed the proposed waiver process for a CVA and use of a lessee's 
engineer because they viewed the project engineer designation as a 
lessening of responsibility and was concerned about conflicts of 
interest in reviewing components.
    Response: BSEE now regulates CVA roles and responsibilities and 
defines the role of the CVA in Sec. Sec.  285.707 and 285.708. Changes 
to the rule on CVA roles and responsibilities will not reduce the level 
of safety on a project, including to mariners or other OCS users, 
because the CVA must meet BSEE requirements for qualifications and 
experience, and the CVA's scope of work will address safety concerns 
through commissioning of the facility. BSEE will rigorously review any 
request for waiver of the CVA requirement to ensure there is no 
reduction in safety prior to accepting the use of a project engineer.
    BSEE has also made the waiver requirements more stringent by 
requiring that waiver requests be submitted in writing to BSEE. If BSEE 
waives the requirement for a CVA, lessees must demonstrate that their 
project engineer can perform the same duties and responsibilities as 
the CVA. Also, the project engineer's qualifications must be submitted 
to BSEE as a part of the waiver request to demonstrate that the project 
engineer is a professional engineer with relevant experience and 
expertise in the facilities they will be verifying or certifying.
    Comment: A commenter requested that the Department clarify the 
phrase ``all incidents'' that affect the design, fabrication, and 
installation of the project and its components that the CVA is required 
to report. The commenter further requested that the proposed rule shift 
the burden of reporting incidents from the CVA to the lessee, who has 
site control, and allow a CVA to verify any modifications needed to 
address the incident.
    Response: BSEE intends the phrase ``Incidents that affect the 
design, fabrication, and installation of the project and its 
components'' to be broadly applicable so that it includes, but is not 
limited to, design changes or events that occur before the final PVR 
that affect the design, fabrication, or installation of the project or 
its components such that the original design envelop, standards, or 
functionality has been changed from what was originally reviewed.
    The regulations at Sec.  285.705(a)(3) require the lessee to use 
CVA(s) to immediately notify BSEE of incidents that affect the design, 
fabrication, and installation of the project and its components. The 
lessee is also responsible for reporting certain incidents as required 
in Sec. Sec.  285.815 and 285.831, and the lessee is responsible for 
accepting any fabrication or installation modifications and notifying 
BSEE as provided in Sec.  285.703.
    BSEE ensures that the lessee upholds its reporting requirements 
(including the requirement to use a CVA to report

[[Page 42672]]

certain incidents) and can take enforcement action if the lessee fails 
to meet these requirements. The use of the CVA for reporting incidents 
as a part of their oversight responsibilities enables their 
participation in evaluating such incidents and providing an independent 
analysis to BSEE and is thus preferable to having the lessee solely 
report incidents.
    Comment: Commenters requested that the Department further clarify 
the role of the CVA in verifying a facility's safety by incorporating 
appropriate consideration for human and occupational safety through 
verification of adherence to industry codes and standards to ensure 
there is not confusion about how a CVA may review a facility.
    Response: BSEE has declined to incorporate new standards into these 
regulations because BSEE has determined that the proposed processes 
adequately account for human health and occupational safety. Human and 
occupational safety must be considered during the risk assessments that 
identify the Critical Safety Systems and Equipment as is required by 
Sec.  285.701(a)(12). The CVA will review the risk assessments for 
adequacy, will certify adherence to the standards identified within the 
FDR and FIR, and will certify that the risk assessment outcomes have 
been integrated into the project design. BSEE will also review the FDR 
and FIR submissions to ensure that appropriate standards are being 
utilized.
    Comment: A commenter discussed the need for a CVA to verify any 
self-inspection plans submitted for facilities in development.
    Response: BSEE has declined to make CVAs verify self-inspection 
plans. The role of a CVA is to oversee design, fabrication, and 
installation. The CVA reports often make recommendations regarding 
inspections, and BSEE will consider those recommendations when BSEE 
reviews a lessee's self-inspection plan.
    Summary of final rule revisions:
    The Department is finalizing paragraphs (a) through (d), consistent 
with proposed Sec.  585.705, with minor revisions. Paragraph (a) allows 
lessees to use one or more CVAs, if approved by BSEE. Paragraph (b) 
adds a responsibility for the CVA to ensure that the facility design is 
suitable for the location where it will be installed, which was 
included in the preamble to the NPRM and is necessary to ensure 
personnel safety over the life of the project. Paragraph (b) also 
finalizes the other CVA responsibilities from the NPRM. In the preamble 
to the proposed rule, the Department explained its expectations that 
the CVA would ensure that the design of the facilities is suitable for 
the location where they will be installed. BSEE determined it was 
prudent to include this expectation in the final rule in paragraph 
(b)(1). Paragraph (c) allows BSEE to waive all or part of the 
requirement for a lessee to use a CVA for the design of a structure if 
the lessee can demonstrate that the facility conforms to a standard 
design that has been successfully used in a similar environment, and 
the installation design conforms to accepted engineering practices. 
Paragraph (c) also allows BSEE to waive all or part of the requirement 
for a lessee to use a CVA for the fabrication or installation of a 
structure if the lessee can demonstrate the relevant fabricator or 
installation company, as applicable, has successfully fabricated or 
installed similar facilities in a similar offshore environment, and the 
facility will be fabricated or installed in conformance with accepted 
engineering practices and to a nationally or internationally recognized 
quality assurance standard. A similar waiver is available for a CVA for 
project modification or repairs. Paragraph (d) requires that waiver 
requests be submitted in writing to BSEE. If BSEE waives the 
requirement for a CVA, lessees must demonstrate that their project 
engineer can perform the same duties and responsibilities as the CVA. 
Also, the project engineer's qualifications must be submitted to BSEE 
as a part of the waiver request to demonstrate that the project 
engineer is a professional engineer with relevant experience and 
expertise in the facilities they will be verifying/certifying.
    BSEE responded to comments concerning CVAs in Section III, D. 
above. Additional comments and responses regarding this provision are 
provided below.
    Sec.  285.706 How do I nominate a CVA for BSEE approval?
    Summary of proposed rule provisions:
    The Department proposed eliminating the requirement that a lessee 
or grant holder nominate a CVA with its COP, SAP, or GAP and, instead, 
proposed that a CVA be nominated and approved before conducting the 
relevant verification activities. The Department also proposed 
requiring that if a lessee or grant holder seeks to use multiple CVAs, 
it must nominate a general project CVA no later than COP submittal to 
manage the project verification strategy, to ensure CVAs are conducting 
their reviews in a consistent manner, and to oversee the transition 
areas between various project components and their associated CVAs.
    The Department also proposed clarifying that the nominated CVA must 
not have been involved in preparing the plans, reports, analyses, or 
other technical submittals that it will verify.
    Summary of comments:
    Comment: A commenter expressed support for the CVA role revisions 
and the approval of CVA nomination prior to COP submittal to create 
flexibility for lessees and the Department.
    Response: The CVA nomination approval occurs within BSEE's 
oversight, therefore, is not tied to the COP.
    Comment: A commenter opposed the use of multiple CVAs for various 
components insofar as it could lead to inconsistencies in the 
verification of a project.
    Response: If multiple CVAs are used on a project, BSEE will require 
one CVA to oversee the entire facility design, fabrication, and 
installation and to ensure continuity across all project components.
    Comment: Several commenters suggested adding language to indicate 
that the CVA scope of work must be in accordance with project 
certification schemes generally accepted and used in industry, such as 
International Electrical Code Renewable Energy (IECRE) OD-502.
    Response: BSEE declines to incorporate any specific project 
certification standard, such as IECRE OD-502. Instead of requiring a 
specific project certification standard such as IECRE OD-502, BSEE 
allows the lessee and CVA to specify the project certification standard 
they would like to use as part of the CVA nomination. BSEE can accept 
or deny the proposed certification standard. This allows BSEE to remain 
flexible and adaptable as these standards continue to evolve. BSEE will 
evaluate the CVA scope of work and ensure that the scope of work fully 
describes the CVA's verification and certification strategy.
    Comment: A commenter also requested that the Department clarify the 
responsibility of a General Project CVA to avoid conflicts and 
misunderstandings that may result in the incorrect completion or non-
performance of verification tasks.
    Response: BSEE has determined that the finalized language in Sec.  
285.706(a) clearly establishes the responsibilities of the general 
project CVA. When multiple CVA's are nominated for a project, a general 
project CVA must be nominated to manage the overall project 
verification and certification approach and ensure consistency between 
and oversight of the other CVAs, especially

[[Page 42673]]

in transition areas between different CVAs.
    Comment: A commenter suggested that the Department adopt an 
independent process to review and approve a company's credentials for 
CVA nomination rather than the project-specific approach proposed by 
the Department, to decouple CVA nomination from the project approval 
processes and encourage new participants in the CVA market.
    Response: BSEE declined to adopt an independent process to review 
and approve a company's credentials for CVA nomination because BSEE 
reviews each CVA nomination to make sure that the nominated CVA has the 
technical expertise, experience, and capacity for the specific project. 
A specific company may be an acceptable CVA for one project and not 
another depending on the technologies involved in the project, 
technical expertise of the company, number of projects the company is 
overseeing, and several other factors. BSEE will continue to review the 
CVA nomination for each specific project.
    Comment: A commenter provided specific regulatory text revisions 
regarding when a CVA is needed on a project and how to nominate a CVA 
for the Department's approval, including a suggestion that CVAs may 
periodically monitor fabrication and installation of a facility and 
utilize type-approved procedures rather than ``proper'' procedures to 
verify a design.
    Response: BSEE agrees that the procedures used and validated during 
the type-approval process should be used for type-approved components. 
For other components, OEM procedures should be used when applicable. 
The frequency of the CVAs oversight will be agreed to in the CVA scope 
of work. BSEE declined to state that the CVA would only periodically 
monitor fabrication and installation because the word ``periodically'' 
can be interpreted differently. Instead, BSEE expects the CVA to 
clearly state their plans for witnessing of fabrication and 
installation activities in the CVA scope of work.
    Summary of final rule revisions:
    The Department is finalizing paragraphs (b)(2) and (7), (c), and 
(d), consistent with proposed Sec.  585.706. BSEE is removing Sec.  
285.706(e) because the Reorganization Rule transferred authority for 
approving a CVA from BOEM to BSEE. The changes in paragraph (a) require 
that a CVA be nominated by the lessee and approved by BSEE prior to 
conducting any verification or certification activities. If a lessee 
intends to use more than one CVA, then a general project CVA must be 
nominated to manage the overall project verification and certification 
approach to ensure consistency and oversight among the other CVAs, 
especially in transition areas between different CVAs. Paragraphs 
(b)(2) and (7) address the technical capabilities of individuals 
involved in a project and the scope and level of work to be performed 
by the CVA, respectively. Paragraph (c) addresses CVAs' potential 
conflicts of interest by prohibiting CVAs from preparing or being 
directly involved in any work related to the preparation of design, 
fabrication, installation, modification, or repair plans for which they 
will provide verification or certification services. Lastly, paragraph 
(d) requires that verification and certification be conducted by or 
under the direct supervision of a registered professional engineer.
    BSEE responded to comments concerning CVAs in Section III, D. 
above. Additional comments and responses regarding this provision are 
provided below.
    Sec.  285.707 What are the CVA's primary duties for facility design 
review?
    Summary of proposed rule provisions: The Department proposed 
changing ``certify'' to ``verify'' in this section. The Department also 
proposed replacing the requirements for floating turbines in the 
existing paragraph (c) with a reworded requirement in proposed 
paragraph (b)(10). The Department also proposed requiring the CVA to 
verify that the facility has been designed to provide for safety and to 
conduct an independent assessment of the design for human safety and 
accident prevention.
    Summary of comments:
    Comment: Several commenters expressed support for the proposed 
revisions to the role of a Certified Verification Agent (CVA), stating 
that the revisions align with best engineering practices and the 
Department's policy goals of encouraging safety.
    Response: BSEE agrees with the commenters and is defining the role 
of the CVA in Sec. Sec.  285.707 and 285.708 that the CVA's oversight 
of both design and fabrication and installation through verifications 
and certifications in order to enhance safety.
    Comment: A few other commenters stated that the change to 
``verification'' rather than ``certification'' promotes safety 
throughout the development process.
    Response: The CVA plays a role in both design and fabrication and 
installation through verifications and certifications. After reviewing 
commenters' feedback and considering various relevant standards and 
references, BSEE understands that the terms ``verification'' and 
``certification'' are not consistently defined across published 
standards. Accordingly, BSEE is defining each term based on the Oxford 
Dictionary and contextual usage in relevant standards. The terms 
``certify'' or ``certification'' describes how the CVA ``recognizes 
that (someone or something) possesses certain qualifications or meets 
certain standards.'' BSEE may require a CVA to ``certify'' that a 
design or safety component conforms to a defined certification protocol 
based on criteria from specific quality assurance standards or 
recognized accepted engineering practices. The terms ``verify'' or 
``verification'' describes how the CVA demonstrates that something is 
true, accurate, or justified.
    BSEE has evaluated each of the CVAs actions, as required by the 
regulations, and updated the regulations to use the appropriate term.
    Comment: A commenter stated that the removal of mooring and 
anchoring systems from CVA verification is an increase to risk and 
safety of a project and requests that the Department reinstate the 
requirement.
    Response: BSEE agrees with the commenter. Any mooring or anchor 
system that supports a floating wind turbine will require CVA 
verification as according to Sec. Sec.  285.707 through 285.709. The 
proposed Sec.  285.707(b)(10) was removed and Sec.  285.707(c) will 
remain in the regulations. Section 285.707(c) explicitly requires CVA 
oversight of the design of systems related to structural integrity, 
stability, ballast, foundations, foundation pilings, templates, 
anchoring systems, mooring, tendon, and tethering systems.
    Comment: A commenter suggested that the Department remove the 
requirement that CVAs must conduct independent assessments of other 
pertinent parameters of proposed designs.
    Response: BSEE declines to make a revision to the regulation based 
on this comment. BSEE does expect the CVA to conduct an independent 
assessment for other pertinent parameters of the design. Designs are 
changing frequently and the CVA must be able to adapt to these changes.
    Summary of final rule revisions:
    The Department is finalizing this regulation consistent with 
proposed Sec.  585.707, with a few minor revisions. BSEE is revising 
this regulation to make minor changes to the description of the CVA's 
duties in Sec.  285.707(a), to ensure that the facility is designed to 
withstand the environmental and functional load

[[Page 42674]]

conditions and to minimize risk to personnel as required by Sec.  
285.105(a). BSEE also determined that the term ``verify'' is more 
appropriate than ``certify,'' as proposed in the NPRM, in this context 
and has made the appropriate regulatory text change. BSEE added a 
requirement to the CVA's duties for design review in 285.707(b). The 
CVA must now assess the lessee's risk assessments supporting the design 
for human safety and how the results are used in the design. Section 
285.707(c) will remain in the regulation to ensure that the CVA 
verifies the design of floating facilities for structural integrity and 
stability. The design must also consider 1) foundations, foundation 
pilings, templates, anchoring systems, and 2) mooring, tendon, and 
tethering systems. BSEE is revising paragraph (c)(3) to include 
``tendon''.
    BSEE responded to comments concerning CVAs in Section III, D. 
above. Additional comments and responses regarding this provision are 
provided below.
    The provisions in this final rule do not change or purport to 
change any other Federal agencies' regulatory requirements, including 
the USCG's regulations governing integrity and stability of floating 
facilities.
    Sec.  285.708 What are the CVA's or project engineer's primary 
duties for fabrication and installation review?
    Summary of proposed rule provisions:
    The Department proposed updating paragraphs (a)(5) and (b) by 
replacing the terms ``certify'' and ``ensure'' with ``verify'' for 
consistency with the proposed changes to the CVA standard of review. 
The Department proposed adding a requirement in paragraph (a)(1) that 
the commissioning of critical safety systems should be consistent with 
Sec.  585.705 and to require that the CVA monitor the commissioning of 
critical safety systems in paragraph (a)(2). The Department proposed 
adding paragraph (a)(6) to require that the CVA provide records 
documenting that critical safety systems are commissioned in accordance 
with the procedures identified in Sec.  585.702(a)(8) and to identify 
the location of all records pertaining to commissioning of critical 
safety systems, as described in Sec.  585.714(c).
    Additionally, the proposed rule would add language regarding 
quality assurance standards to ensure consistency with Sec.  
585.702(a)(6). The Department also proposed moving the requirement in 
paragraph (a)(5)(ii) to Sec.  585.637. The Department proposed 
requiring that if multiple CVAs are used--thus necessitating multiple 
verification reports for different project components--the general 
project CVA must submit the final verification report for the entire 
project prior to the commencement of commercial operations under Sec.  
585.637.
    Summary of comments:
    Comment: A commenter suggested that the Department formalize the 
Project Verification Report using a consistent term, ``PVR.''
    Response: BSEE includes the minimum requirements of a project 
verification report in Sec.  285.708. BSEE also revised Sec. Sec.  
285.637, 285.702, 285.704, and 285.708 to consistently use the term 
``project verification report.''
    Comment: Commenters suggested that the Department add the word 
``material'' to certain CVA requirements in Sec.  585.708(b) to ensure 
focus on relevant changes rather than all potential changes.
    Response: BSEE has decided not to add the term ``material'' in 
Sec.  285.708 because ``material'' is not a sufficiently definite term. 
BSEE will engage with the CVAs to ensure our expectations for reporting 
changes during fabrication and installation are met and BSEE may issue 
guidance if additional clarifications are necessary.
    Comment: A commenter supports the change from ``certification'' to 
``verification'' but stated concern with the overall approach of the 
proposed part 285 when compared to similar processes in 30 CFR part 250 
regarding technical requirements. The commenter stated that there is an 
inconsistency between the CVA verification and the language describing 
a statement within the FDR/FIR that a CVA has verified various 
components. The commenter requested that clear guidance be provided 
from BSEE on the expectations of CVA reviews of reports.
    Response: BSEE has evaluated each use of the terms 
``certification'' and ``verification,'' and has revised the regulations 
to ensure each term is used appropriately and consistently. Within this 
context, the terms ``certify'' or ``certification'' describe how the 
CVA ``recognizes that (someone or something) possesses certain 
qualifications or meets certain standards.'' BSEE may require a CVA to 
``certify'' that a design or safety component conforms to a defined 
certification protocol based on criteria from specific quality 
assurance standards or recognized accepted engineering practices. The 
terms ``verify'' or ``verification'' describe how the CVA demonstrates 
that something is true, accurate, or justified. BSEE has evaluated each 
of the CVAs actions required by the regulations and revised the 
regulations to use the appropriate term.
    BSEE has reviewed the regulations and has determined that the 
finalized version here provides clear expectations regarding CVA 
reviews of reports. BSEE will engage with the CVAs to ensure our 
expectations for reporting changes during fabrication and installation 
are met and BSEE may issue guidance if additional clarifications are 
necessary.
    Summary of final rule revisions:
    The Department is finalizing this regulation, consistent with 
proposed Sec.  585.708, with minor revisions. BSEE is revising 
paragraphs (a)(1), (2), and (5); adding paragraphs (a)(6) and (7); and 
revising paragraph (b).
    BSEE is not finalizing the proposed paragraph (a)(5)(ii) because 
requirements for the commencement of commercial operations have been 
moved to Sec.  285.637. BSEE also determined that the term ``certify'' 
is more appropriate than ``verify'' in this context and has made the 
appropriate regulatory text change as explained in comments above.
    The revisions to paragraphs (a)(1), (2), and (5) update 
expectations for the CVA's oversight of fabrication and installation. 
Specifically, the CVA must use good engineering judgment and practice 
in conducting an independent assessment of the commissioning of 
Critical Safety Systems and Equipment and monitor the commissioning of 
Critical Safety Systems and Equipment. Paragraph (a)(5) requires the 
CVA to certify in Project Verification Reports that project components 
are fabricated and installed in accordance with accepted engineering 
practices and to a nationally or internationally recognized quality 
assurance standard or to an equivalent alternate means of quality 
assurance considered on a case-by-case basis, your BOEM-approved SAP, 
COP, or GAP (as applicable), and your FIR. The Project Verification 
Reports must also identify the location of all facility fabrication and 
installation records. Paragraph (a)(6) requires CVAs to provide records 
documenting Critical Safety Systems and Equipment are commissioned in 
accordance with the procedures identified in Sec.  285.702(a)(8). 
Paragraph (a)(7) require CVAs to identify the location of records 
pertaining to the commissioning of Critical Safety Systems and 
Equipment as required in Sec.  285.714(c).
    Paragraph (b) now requires the CVA or project engineer to monitor 
the fabrication and installation of the facility and the commissioning 
of Critical Safety Systems and Equipment to certify that it has been 
built and installed according to the lessee's

[[Page 42675]]

FDR(s) and FIR(s). Additionally, under paragraph (b)(1), the CVA or 
project engineer must inform the lessee and BSEE if either fabrication 
and installation procedures or Critical Safety Systems and Equipment 
commissioning procedures, or both, have been changed or design 
specifications have been modified. Under paragraph (b)(2), The CVA or 
project engineer must inform BSEE of any modifications they accept.
    BSEE responded to comments concerning CVAs in Section III, D. 
above. Additional comments and responses regarding this provision are 
provided below.
    Sec.  285.709 When conducting onsite fabrication inspections, what 
must the CVA or project engineer verify?
    Summary of proposed rule provisions: The Department proposed 
revising this section to mirror the proposed changes to Sec.  585.701 
by modifying paragraph (b) to remove the references to the U.S. Coast 
Guard and by specifying the CVA must verify the structural integrity, 
stability, and ballast of a floating facility. The Department also 
proposed modifying paragraph (b) to remove the requirement for 
consideration of foundations, foundation pilings and templates, and 
anchoring systems, as well as mooring or tethering systems, because 
those requirements are addressed in Sec.  585.710.
    Summary of comments: BSEE did not receive any comments regarding 
this section.
    Summary of final rule revisions: The Department is finalizing 
paragraph (a), consistent with proposed Sec.  585.709. BSEE made minor 
edits to the proposed changes to Sec.  285.709(a) by revising paragraph 
(a)(13) to include ``tendon'' to be inclusive of all mooring system 
types. BSEE is not finalizing proposed changes to paragraph (b) of this 
section and is keeping the provision in the existing regulation.
    BSEE responded to comments concerning CVAs in Section III, D. 
above.
    The provisions in this final rule do not change or purport to 
change any other Federal agencies' regulatory requirements, including 
the USCG's regulations governing integrity and stability of floating 
facilities.
    Sec.  285.710 When conducting onsite installation inspections, what 
must the CVA or project engineer do?
    Summary of proposed rule provisions: The Department proposed 
requiring that the CVA ``verify'' the enumerated items to ensure 
consistency with the ``verification'' standard for CVA activities. The 
Department also proposed adding language in several locations requiring 
the CVA to verify the commissioning of critical safety systems to be 
consistent with Sec.  585.705. The Department proposed adding paragraph 
(f) to clarify that the CVA must make periodic onsite inspections to 
verify: (1) the systems and equipment function as designed; and (2) the 
final commissioning records are complete during periodic onsite 
inspections.
    Summary of comments:
    Comment: A commenter stated that the ``Background'' section of the 
proposed rule should be revised to reflect the current expectations for 
third-party witnessing of certain commissioning activities, as recently 
issued in a COP Approval Letter Terms and Conditions.
    Response: BSEE has included requirements in Sec.  285.710 for 
commissioning activities that are similar to those found in the COP 
terms and conditions. BSEE will also engage with the CVAs to ensure 
expectations for commissioning are clear.
    Comment: A commenter stated that attending and witnessing of 
commissioning activities of safety and protection functions by the CVA 
is not necessary as these functions are already type-certified as part 
of the IECRE-OD501 process. The commenter instead provided several 
regulatory text revisions to recommend that verification by a CVA be 
limited to a review of completeness of commissioning records and 
systems and remove the requirement of a review for type-certified 
components.
    Response: BSEE disagrees that witnessing the commissioning of 
Critical Safety Systems and Equipment is not necessary. One of the 
roles of the CVA is to certify that engineering procedures are executed 
as designed. BSEE has determined that periodic witnessing of 
commissioning operations, including Critical Safety Systems and 
Equipment commissioning, in addition to reviewing completeness records 
is necessary to ensure conformance with submitted plans, proper 
functioning of all Critical Safety Systems and Equipment, and 
completion of installation as designed.
    Comment: A commenter requested that the Department clarify whether 
some or all Critical Safety Systems and Equipment being referenced in 
30 CFR 585.710 and the periodic inspection referenced in proposed 30 
CFR 585.710(a) is applicable to all of the scope described by paragraph 
(b).
    Response: Critical Safety Systems and Equipment are identified on a 
project basis through the risk assessment process. The inspection 
program is designed to ensure that it is focused on critical areas and 
needs of each project. All Critical Safety Systems and Equipment would 
be included in the regulatory requirements.
    Comment: A commenter requested clarification of the requirements 
for the submission of as-builts. The commenter suggested that as-builts 
should include as-fabricated drawings and documents of any facilities 
outlined in a BOEM-approved SAP, COP, or GAP; a complete set of cable 
drawing(s) and as-fabricated cable drawing(s) in the FIR; electrical 
one-line drawing(s); cause-and-effect chart; and schematics of fire and 
gas-detection system(s). The commenter provided additional suggestions 
for the timeline of submission for these items and additional details 
about what they should include.
    Response: BSEE is declining to update the regulations regarding as-
builts in this final rule. BSEE may issue an NTL to clarify the as-
built requirements or update the regulations in the future should 
additional requirements be necessary.
    Summary of final rule revisions:
    The Department is finalizing this regulation, consistent with 
proposed Sec.  585.710. Through this regulation, BSEE has clarified and 
added requirements to ensure that the CVA or project engineer scope 
includes verification and witnessing of the commissioning of the 
Critical Safety Systems and Equipment. To achieve this, BSEE is 
revising portions of paragraphs (a) through (g). Paragraph (a) requires 
the CVA or project engineer to make periodic onsite inspections while 
installation is in progress. Paragraph (b) enumerates a list of items 
that the CVA or project engineer must verify. Specifically, paragraph 
(b)(9) is added to address the commissioning of Critical Safety Systems 
and Equipment. Paragraph (c) requires the CVA or project engineer to 
verify that certain proper procedures were used for fixed or floating 
facilities. Paragraph (d) requires that the CVA or project engineer 
verify structural integrity, stability, and ballast, and that proper 
procedures were used during certain stages of work for floating 
facilities. The requirement that for ``a floating facility, the CVA or 
project engineer must verify the structural integrity, stability, and 
ballast'' was proposed in Sec.  285.709 but was also added to Sec.  
285.710(d) because this verification work can only happen at the time 
of installation.
    BSEE made minor edits to proposed paragraphs (b)(6) and (d)(3) to 
include ``tendon'' to be inclusive of all mooring system types.
    Paragraph (e) requires the CVA or project engineer to conduct an 
onsite inspection of the installed facility as

[[Page 42676]]

approved in the CVA scope of work. Paragraph (f) requires the CVA or 
project engineer to make periodic onsite inspections to witness the 
commissioning of Critical Safety Systems and Equipment in order to 
verify that they function as designed and that the final commissioning 
records are complete. Paragraph (g) requires the CVA or project 
engineer to spot-check the equipment, procedures, and recordkeeping as 
necessary to determine compliance with the applicable documents 
incorporated by reference and the regulations under this part.
    BSEE responded to comments concerning CVAs in Section III, D. 
above. Additional comments and responses regarding this provision are 
provided below.
    Sec.  285.712 What are the CVA's or project engineer's reporting 
requirements?
    Summary of proposed rule provisions: The Department proposed adding 
a requirement that the CVA report summarize any issues with facility 
design, fabrication, or installation, or the commissioning of critical 
safety systems to allow the Department to catalog a history of 
successfully resolved issues and lessons learned, enabling the 
Department to assess and facilitate the improvement and evolution of 
the OCS renewable energy industry and the CVA program.
    Summary of comments:
    Comment: A commenter suggests formalizing the name of the Critical 
Safety Systems Commissioning Records (CSSCR) throughout the Rule.
    Response: BSEE did not create a new record called the CSSCR as this 
reference is only used in Sec. Sec.  285.637, 285.710, and 285.714. 
However, the Department does require the lessee to submit a risk 
assessment that identifies the Critical Safety Systems and Equipment 
(CSSE) and a description of the identified CSSE pursuant to Sec.  
285.701(a)(12), commissioning procedures for CSSE pursuant to Sec.  
285.702(a)(8), and a major modification or repair report if major 
repairs or modifications to CSSE pursuant to Sec.  285.703. The CVA 
must also verify the design, fabrication, installation, and 
commissioning of CSSE pursuant to Sec. Sec.  285.705 and 285.707-
285.710 and must summarize any issues with the design and any incidents 
during facility fabrication and installation, or CSSE commissioning, 
and how those issues were resolved pursuant to Sec.  285.712. BSEE did 
not revise the final rule based on this comment. There is additional 
discussion regarding the subject of the comment in the NPRM.
    Summary of final rule revisions:
    The Department is finalizing this regulation, consistent with 
proposed Sec.  585.712, with one edit. BSEE is revising this regulation 
to require that the CVA or project engineer prepare all reports and 
records pursuant to this subpart. The CVA or project manager must 
submit the interim version of the required reports or records to the 
lessee and BSEE, as requested by BSEE. BSEE will have 30 days to review 
the reports. The CVA or project engineer must submit the final version 
of the required reports or records to BSEE. The CVA's or project 
engineer's report or record must summarize any issues with the design 
and any incidents during facility fabrication and installation, or 
Critical Safety Systems and Equipment commissioning, and how those 
issues were resolved.
    BSEE moved the 30-day CVA report review from existing Sec. Sec.  
285.637 and 285.708 to this section to decouple the concept of 
reviewing CVA reports and the start of commercial operations.
    BSEE responded to comments concerning CVAs in Section III, D. 
above. Additional comments and responses regarding this provision are 
provided below.
    Sec.  285.713 [Reserved]
    Summary of proposed rule provisions: The Department proposed moving 
the requirement that a lessee must notify the Department within 10 
business days of commencing commercial operations from Sec.  585.713 to 
the proposed Sec.  585.637 to consolidate this provision with the other 
requirements in Sec.  585.637 related to the commencement of commercial 
operations. The Department proposed deleting the existing section 
title, ``What must I do after the CVA or project engineer confirms 
conformance with the Fabrication and Installation Report on my 
commercial lease?,'' and reserving the section for future use.
    Summary of comments: BSEE did not receive any comments regarding 
this section.
    Summary of final rule revisions: BSEE is removing and reserving 
this section, consistent with the NPRM.
    Sec.  285.714 What records relating to FDRs, FIRs, and Project 
Modification and Repair Reports must I keep?
    Summary of proposed rule provisions:
    The Department proposed requiring that the records of the 
commissioning of critical safety systems must be kept and made 
available to the Department until BOEM releases the lessee from its 
financial assurance. The proposed rule also suggested requiring the 
lessee to provide the Department with the location of the records of 
the commissioning of its critical safety systems.
    The Department proposed a technical correction to this section to 
clarify that the recordkeeping requirements apply to the design, 
engineering, and modification and repair reports regulated in this 
subpart. The Department proposed removing reference to recordkeeping 
requirements for SAPs, COPs, and GAPs because they are addressed in the 
existing and proposed Sec.  585.602.
    The Department also proposed adding records of commissioning of 
critical safety systems to the list of records to reflect changes 
proposed elsewhere.
    Summary of comments:
    Comment: A commenter suggested adding a new section: ``What must I 
include in my as-built submissions?''
    [cir] ``(a) Your as-fabricated drawings and documents of any 
facilities that are outlined in your FDR and FIR, must be made 
available to DOI prior to PVR non-objection and must include the 
following items:''
    [ssquf] ``Required documents: (1) Complete set of cable drawing(s) 
Description of required content: Complete set of as-fabricated cable 
drawing(s).''
    [ssquf] ``Required documents: (2) Electrical one-line drawing(s) 
Description of required content: As-fabricated electrical one-line 
drawing(s) for the facilities.''
    Response: BSEE did not revise the final rule to address this 
comment, but BSEE may publish an NTL to address expectations for as-
built submissions, as necessary, and BSEE may consider a regulatory 
update in future rulemakings.
    Summary of final rule revisions: The Department is finalizing this 
regulation, consistent with proposed Sec.  585.714. BSEE is revising 
this regulation to require additional recordkeeping measures for the 
commissioning of Critical Safety Systems and Equipment and the location 
of records, as required in Sec. Sec.  285.701(c) and (d), 285.702(c) 
and (d), 285.703(b), and 285.708(a)(5) and (7).
    Sec.  285.803 How must I conduct my approved activities to protect 
essential fish habitats identified and described under the Magnuson-
Stevens Fishery Conservation and Management Act?
    Summary of proposed rule provisions: The Department proposed 
amending the first sentence of paragraph (b) by replacing the word 
``affects'' with the word ``effects.''
    Summary of comments: BSEE did not receive any comments regarding 
this section.
    Summary of final rule revisions: The proposed change is not 
applicable to

[[Page 42677]]

Sec.  285.803, so no changes have been made to this section in the 
final rule. After certain renewable energy regulations were transferred 
from BOEM to BSEE in the Reorganization Rule, BOEM retained the 
language that was in Sec.  585.803 but moved it to Sec.  585.703. 
BSEE's existing Sec.  285.803 states, ``You must comply with all 
measures required under 30 CFR 585.703.''
    Sec.  285.810 When must I submit a Safety Management System (SMS) 
and what must I include in my SMS?
    Summary of proposed rule provisions: The Department proposed 
requiring a lessee to use an SMS for activities conducted on the OCS to 
develop or operate a lease, from met buoy placement and site assessment 
work through decommissioning, and to provide its SMS to the Department 
upon request. The lessee would also be required to submit a detailed 
description of the SMS with its COP (as provided under Sec.  
585.627(d)), SAP (as provided in Sec.  585.614(b)), or GAP (as provided 
in Sec.  585.651).
    Summary of comments:
    Comment: A commenter expressed concerns that the proposal could 
reduce the frequency and intensity of regulatory oversight on safety 
issues and requested that the Department share any information related 
to requirements for Contingency Plans for potential catastrophic events 
at OSW development sites.
    Response: Regulatory oversight ensuring the safety of offshore 
workers and responsible environmental stewardship of offshore wind 
activities is a primary focus of BSEE and these SMS regulations reflect 
this focus. Section Sec.  285.812(b) provides for ``regular 
demonstration'' that the SMS is used and implemented effectively via 
annual activity reports to BSEE and triannual reports summarizing the 
lessees or grantees most recent SMS audit results, including corrective 
actions, and an updated description of the lessees or grantees SMS 
highlighting changes made since the last submission. With regard to 
potential catastrophic events, BSEE requires the development and 
functionality of Emergency Response Procedures in Sec. Sec.  285.810(c) 
and 285.812.
    Comment: Multiple commenters suggested that the Department clarify 
that the SMS also apply to the safety of mariners, including fishermen, 
within and near an OSW facility. Several commenters requested 
clarifications on SMS scope, review, approval, certification standards, 
definitions, submissions, and oversight roles.
    Response: BSEE recognizes the importance of consistent safety 
programs and risk mitigations and their potential impacts to the 
fishing and recreation industries, and how they influence performance-
based regulatory programs. BSEE considers environmental safety to be 
within the scope of an SMS. While the SMS regulations themselves do not 
apply to mariners, including fishermen, the intent of the SMS 
regulations are to ensure the safety of personnel or anyone near or on 
the facilities.
    Regarding comments seeking clarification on SMS generally, BSEE has 
provided guidance to the industry related to these comments in Safety 
Management System Expectations for Renewable Energy Companies Operating 
on the OCS, which is posted on the BSEE website at https://www.bsee.gov/technical-presentations/ooc-presentation-sms-in-ocs-renewable-projects-may-13. This guidance includes information about 
submissions, frameworks, and reviews.
    Comment: Several commenters stated that the Department should 
protect workers and worker's rights by requiring LPAs for operations 
and maintenance workers as a condition of all renewable OSW leases and 
ensure developer commitments to not discriminate or retaliate against 
workers or contractors who raise health and safety concerns. One 
commenter provided background information to show the importance of 
improving workers' rights, stating that in the construction industry 
alone, union worksites have 31% fewer health and safety violations. In 
all industries, states with right-to-work laws (and consequently lower 
union density) have a 14.2% higher rate of workplace deaths than states 
without such laws. Without the Department's action, operations and 
maintenance workers would have few protections at either the State or 
Federal levels.
    Response: While BOEM has jurisdiction over lease terms, BSEE agrees 
that a positive safety culture includes the right to stop unsafe work 
and that retaliation leads to a negative safety culture. To ensure the 
safety of lessees and grantee personnel or anyone else on their 
facilities, Sec.  285.810(a)(5) requires them to submit procedures as 
part of the SMS for personnel or visitors to report unsafe work areas 
or conditions to both the lessee, grantee or designated operator and 
BSEE. BSEE will verify workers have a means of reporting unsafe working 
conditions. BSEE also offers a means of reporting unsafe working 
condition via the Safety and Incident Investigations Division (SIID) 
Hotline: (877) 440-0173 or (202) 208-5646. Section 285.813(b)(1) 
requires lessees to provide a written report to BSEE of any injury in 
which a person is unable to return to work or perform their normal 
duties the following day.
    Comment: Several commenters provided editorial revisions to the 
language in the proposed rule related to shut-downs, new language to 
define the contents of as-built submissions, and details included in 
SMS descriptions in plans. One such example revises certain language in 
Sec.  585.810(b)(5) from ``shut-down of one or more facilities'' to 
``manual shut-down of one or more facilities for the preservation of 
safety.''
    Response: BSEE agrees that all conditions might not be available 
while the COP is still in the approval process and that it will change 
over time as the program evolves. The objective of this requirement is 
for lessees to demonstrate an awareness of conditions that could lead 
to a shutdown of one of more facilities and what they have in place to 
control or mitigate the risks.
    BSEE supports the continued focus on performance-based approaches 
to Safety Management Systems. BSEE is declining to update the 
regulations regarding as-builts in this final rule. BSEE may issue an 
NTL to clarify the as-built requirements or update the regulations in 
the future should additional requirements be necessary. BSEE is 
declining to change the language proposed limiting shutdown of 
facilities to only manual shutdowns. Other types of shutdowns are 
critical for safety and should be included in the SMS.
    Comment: A commenter recommended replacing ``allision'' with 
``collision'' at 585.810(c)(1). The commenter also recommended 
replacing ``(e.g., ANSI Z10, ISO/IEC 45001)'' with ``(e.g., ANSI/ASSP 
Z10, ISO 45001).'' The commenter stated that ``IEC 45001'' does not 
exist and ``ANSI Z10'' is a shorthand expression that should be written 
out.
    Response: BSEE recognizes the difference between an ``allision'' 
and ``collision.'' BSEE revised the regulations to require reporting 
for both collisions and allisions. BSEE also corrected the standard's 
name with the official standard title.
    Summary of final rule revisions:
    The Department is finalizing this section, consistent with proposed 
Sec.  585.810, with minor revisions. For added clarity, BSEE is 
including items required in the SMS under paragraphs (a) through (f). 
Additionally, BSEE is revising the language in paragraph (a)(1) to 
clarify that the health and safety risk provisions in this paragraph 
also apply to anyone ``engaged in lease activities.'' In paragraph 
(a)(3), BSEE is clarifying that nationally or internationally

[[Page 42678]]

recognized standards are applicable to ensure the safety of the 
activities covered by the SMS. BSEE is also making minor edits to this 
section to apply the transfer of authority from BOEM to BSEE and make 
corresponding corrections to regulation references.
    BSEE responded to comments concerning SMS in Section III, H. above. 
Additional comments and responses regarding this provision are provided 
below.
    Sec.  285.811 Am I required to obtain a certification of my SMS?
    Summary of proposed rule provisions: The Department proposed adding 
Sec.  585.811 stating that third-party SMS certification may be 
obtained from accredited safety and environmental CABs. Such 
certification would possibly benefit a lessee or a grant holder through 
reduced frequency or scope of safety inspections and oversight of 
corrective actions arising from lessee or grant holder self-
inspections. The Department could rely on such third-party 
certifications for assurance of SMS compliance in lieu of direct 
inspection. Additionally, the Department determined that a CAB's use of 
a consensus safety standard--such as ANSI Z10 or ISO/IEC 45001--would 
allow the incorporation of the most current safety approaches in a 
rapidly evolving industry without the need for additional rulemaking.
    Summary of comments:
    Comment: Multiple commenters expressed support for the proposed 
shift to a performance-based approach for SMS, particularly related to 
incentives for obtaining certification or accreditation for SMS, 
streamlined oversight, clearer safety expectations, coordination 
enforcement through the Department, requirements for more detail to be 
included in the SMS, and reporting requirements to allow comparisons of 
safety industry-wide.
    Response: BSEE supports the continued focus on a performance-based 
approach to Safety Management Systems. BSEE is continually evaluating 
improvements to the performance-based approach that have been 
integrated into this rulemaking and they may also be considered in 
future rules.
    Comment: A commenter discussed a third-party SMS, including 
accreditation and upcoming revisions to a standards document, Safety 
and Environmental Management Systems (SEMS) API (American Petroleum 
Institute) Recommended Practice (RP) 75 (4th ed.), and suggested that 
the Department acknowledge this document and recognize the commenter's 
program for accreditation as suitable for SMS certification. Some 
changes the commenter recommended to the proposed rule include:
     In Sec.  585.811, include API RP 75 in the parenthetical 
examples of acceptable health and safety standards and modify the first 
sentence such that it reads: ``You are not required to obtain a 
certificate that your SMS meets acceptable health and safety standards 
(e.g., API RP 75, ANSI Z10, ISO 45001) from a recognized accreditation 
organization (e.g., COS, ANAB).'' In the corresponding preamble, 
provide supporting information in the preamble for proposed Sec. Sec.  
585.810 through 585.812 supporting API RP 75 as an acceptable health 
and safety standard, and recognize COS's accreditation program for ASP 
and COS's SEMS certificate program as suitable for lessees or grant 
holders to receive incentives for their SMS.
    Response: BSEE agrees that API RP 75 (4th ed.) is one acceptable 
SMS framework standard and has included it as an example of an 
acceptable standard in Sec.  285.811. This rulemaking does not specify 
any recognized accreditation organization. BSEE has taken a 
performance-based approach and declined to specify standard and 
accreditation organizations at this point in time. The process 
implemented here provides flexibility to both the lessee and BSEE.
    Summary of final rule revisions:
    The Department is finalizing this regulation, consistent with 
proposed Sec.  585.811. BSEE is revising this regulation to update the 
transfer of authority from BOEM to BSEE in considering certifications 
in determining the frequency and scope of SMS-related inspections under 
this subpart, as well as the scope and nature of its oversight over any 
audit-induced corrective actions. The final rule revises the list of 
examples of acceptable health and safety standards to also include API 
RP 75.
    BSEE responded to comments concerning SMS in Section III, H. above. 
Additional comments and responses regarding this provision are provided 
below.
    Sec.  285.812 How must I implement my SMS?
    Summary of proposed rule provisions: The Department proposed 
redesignating the existing regulatory text as paragraph (a) and 
revising it to be consistent with the clarifications in proposed Sec.  
585.810. The Department also proposed adding paragraph (b) to include 
two reporting requirements. The first proposed report is an annual 
summary of safety performance data that is due March 31 covering the 
previous calendar year during which site assessment, construction, 
operations, or decommissioning activities occurred. The second proposed 
report is a summary of the most recent SMS audit, corrective actions 
implemented or pending as a result of that audit, and an updated SMS 
description highlighting changes made since the last report. This 
report would be due every 3 years or upon request.
    Summary of comments:
    Comment: Some commenters asserted that the Department should 
require an annual summary of safety performance data covering all site 
assessment, construction, operations, or decommissioning activities; 
and a report summarizing the results of the most recent SMS audit that 
describes corrective actions and any SMS changes made.
    Response: BSEE will require safety performance data be submitted to 
BSEE according to Sec.  285.812(b)(1). BSEE intends to publish combined 
data on its website on a regular basis.
    Comment: Some commenters stated that while they welcome SMS 
certification from accredited safety and environmental CABs, the 
Department should not rely on such third-party certifications for 
assurance of SMS compliance in lieu of direct inspection by the 
Department. However, if the Department does permit self-inspection, 
third-party SMS certification from safety and environmental CABs should 
be required, and the third-party reports should be attested to, filed 
with the agency, and accessible to the public on the agency's website.
    Response: BSEE does not rely solely on third-party certifications 
for assurance of SMS compliance, nor does it rely solely on self-
inspections for assurance of operational regulatory compliance. A 
lessee SMS certification will be considered by BSEE during its 
inspection data analysis, but it does not eliminate BSEE's ability to 
conduct direct inspections. BSEE intends to publish combined data on 
its website on a regular basis. BSEE is not requiring third-party SMS 
certification, but third-party certification is encouraged. BSEE has 
multiple ways to conduct safety oversight of projects, including self-
inspections, BSEE direct inspections, SMS third-party audits, BSEE led 
SMS reviews, and remote inspections. BSEE has determined that utilizing 
a performance-based approach to inspection frequency will be more 
effective and allow for more comprehensive oversight. BSEE has 
determined that the performance-based approach will allow for proactive 
identification of hazardous conditions.
    Summary of final rule revisions:

[[Page 42679]]

    The Department is finalizing this regulation, consistent with 
proposed Sec.  585.812. BSEE has moved this requirement from Sec.  
585.811 to this section and has added paragraph (b), which includes the 
reporting requirements that demonstrate your SMS is being implemented 
effectively. BSEE is making minor edits to apply the transfer of 
authority from BOEM to BSEE.
    BSEE responded to comments concerning SMS in Section III, H. above. 
Additional comments and responses regarding this provision are provided 
below.
    Sec.  285.815 What must I do if I have facility damage or an 
equipment failure?
    Summary of proposed rule provisions: The Department proposed 
correcting an erroneous cross-reference in paragraph (a).
    Summary of comments: BSEE did not receive any comments regarding 
this section.
    Summary of final rule revisions: The Department is finalizing this 
regulation, consistent with proposed Sec.  585.815. BSEE is revising 
paragraph (a) of this regulation to require major repairs to be 
reported to BSEE under Sec.  285.703. BSEE is making minor edits to 
apply the transfer of authority from BOEM to BSEE.
    Sec.  285.820 Will BSEE conduct inspections?
    Summary of proposed rule provisions: The Department proposed 
updating the regulations to clarify that the Department may inspect OCS 
facilities and any vessels engaged in activities authorized under this 
part. The Department proposed clarifying that during the inspections, 
the Department would verify that activities are conducted in compliance 
with OCSLA, conditions and stipulations of the lease or grant, approved 
plans, and other applicable laws and regulations. The Department would 
also determine whether proper safety equipment has been installed and 
is operating properly according to the SMS.
    Summary of comments:
    Comment: Several commenters stated that more clarity is needed 
regarding which vessels would be subject to Department inspections; the 
roles of BOEM, BSEE, USCG, and independent inspection companies 
contracted by lessees to conduct inspections; the intensity and focus 
of inspections; and how inspections would address operational safety, 
environmental risk, and engineering.
    Response: BSEE-led inspections are limited to vessels conducting 
lease activities in Federal waters that occur either on the lease or an 
associated easement. Both BSEE-led inspections and self-inspections 
will focus on ensuring that lease activities are being conducted in 
compliance with the regulations, which are written to provide 
protections to human safety and the environment. As described above, 
BSEE's analysis of compliance, risk, and performance data will enable 
it to tailor its scheduled and unscheduled inspections, including 
utilization of remote inspections, remote testing, witnessing, and 
review of self-inspection, allowing for comprehensive oversight.
    Comment: Multiple commenters suggested that the Department should 
consider remote condition monitoring using technology in conjunction 
with targeted inspections to reduce the burden of yearly physical 
inspections or should allow lessees to conduct less frequent 
inspections coordinated with routine maintenance activities. Multiple 
commenters provided revised text to include in the final rule 
reflecting these changes. A commenter also suggested that the 
Department should allow lessees to provide justification for a self-
inspection period greater than one year.
    Response: OCSLA requires an annual onsite inspection of all safety 
equipment designed to prevent or ameliorate fires, spillages, or other 
major accidents. Accordingly, BSEE lacks authority to increase the time 
between inspections beyond one year. BSEE supports the use of remote 
condition monitoring by lessees to inform their productivity and 
compliance efforts. BSEE's inspection program considers compliance, 
risk, and performance-based data, which may be collected, and informed, 
by remote monitoring technology, as well as the prescriptive annual 
onsite inspection as required by the OCSLA.
    Comment: A commenter stated that while the preamble language 
discussing the proposed rules appears to indicate that the Department 
would continue to conduct regular inspections, as written the proposed 
rules do not require the Department to do so. The commenter recommended 
that the Department's regulations provide some minimum frequency for 
conducting onsite inspections to ensure adequate oversight of OCS 
facilities.
    Response: OCSLA requires an annual onsite inspection of all safety 
equipment designed to prevent or ameliorate fires, spillages, or other 
major accidents. Accordingly, BSEE lacks authority to increase the time 
between inspections beyond one year. BSEE supports the use of remote 
condition monitoring by lessees to inform their productivity and 
compliance efforts. BSEE's inspection program considers compliance, 
risk, and performance-based data, which may be collected, and informed, 
by remote monitoring technology, as well as the prescriptive annual 
onsite inspection as required by the OCSLA. The results of those and 
other additional mandated inspections will be evaluated along with 
lessee's performance record to determine the frequency of onsite 
inspections by BSEE personnel. BSEE has determined that prescribing a 
minimum frequency for BSEE inspections is not necessary at this time. 
BSEE will use compliance, risk, and performance-based data to remain 
adaptive as the renewable energy industry matures. . . .
    Comment: A commenter expressed support for changing the phrase 
``will inspect'' to ``may inspect'' in proposed Sec.  585.820. The 
commenter remarked that this change would provide more flexibility to 
the agency in allocating inspection resources while still retaining 
full authority to inspect facilities and vessels engaged in OCS 
renewable energy development.
    Response: BSEE agrees with the commenter that changing ``will 
inspect'' to ``may inspect'' provides more flexibility to the agency in 
allocating inspection resources and revised Sec.  285.820 accordingly.
    Comment: Commenters opposed the proposed language, which stated 
that the Department ``may conduct'' an inspection. A commenter asserted 
that if the Department is not largely responsible for inspections, the 
agency would not be in a proactive position to address operational 
safety issues. The commenter suggested that the Department improve 
transparency in the inspection process by requiring more detailed 
public reports and protection of worker's rights.
    Response: BSEE will be involved in the inspection process, 
including onsite inspections. BSEE determined that utilizing a 
compliance, risk, and performance-based approach to onsite BSEE 
personnel inspection frequency, remote inspections, remote testing 
witnessing, and review of self-inspection will be more effective, allow 
for more comprehensive oversite, and will allow for proactive 
identification of hazardous conditions. Also, allowing self-inspection 
to occur during maintenance visits reduces personnel exposure and 
facility downtime.
    BSEE currently releases performance statistics on the BSEE website 
that track trends and provide incidents analysis and safety and health 
performance-for oil and gas operations from performance data gathered 
by BSEE, as required under 30 CFR 250.1929. BSEE plans to release 
similar information for OSW

[[Page 42680]]

based on the performance data collected under Sec.  285.812. Section 
285.812 requires that key safety and operational statistics are 
captured by the lessees and reported to BSEE. BSEE uses this 
information to calculate a variety of annual, OCS-wide, performance 
indices and to track industry performance. These indices calculated by 
BSEE allow lessees to benchmark their performance against aggregate 
industry data, and for BSEE to provide the public with OCS performance 
trends information.
    Summary of final rule revisions:
    The Department is finalizing this regulation, consistent with 
proposed Sec.  585.820, with minor revisions. BSEE is revising this 
regulation to change the word ``will'' to ``may'' in the first sentence 
to read ``BSEE may inspect OCS facilities and any vessels engaged in 
activities authorized under this part.'' BSEE is also making minor 
edits to this section to apply the transfer of authority from BOEM to 
BSEE.
    BSEE responded to comments concerning inspections in Section III, 
I. above. Additional comments and responses regarding this provision 
are provided below.
    Sec.  285.821 Will BSEE conduct scheduled and unscheduled 
inspections?
    Summary of proposed rule provisions: The Department proposed 
clarifying that it may conduct both scheduled and unscheduled 
inspections.
    Summary of comments: BSEE addressed comments relevant to this 
provision in the ``Summary of comments'' for Sec.  285.820 immediately 
above.
    Summary of final rule revisions:
    The Department is finalizing this regulation, consistent with 
proposed Sec.  585.821. BSEE is revising this regulation to change the 
word ``will'' to ``may'' to read ``BSEE may conduct both scheduled and 
unscheduled inspections.'' BSEE is also making minor edits to this 
section to apply the transfer of authority from BOEM to BSEE.
    BSEE responded to comments concerning inspections in Section III, 
I.
    Sec.  285.822 What must I do when BSEE conducts an inspection?
    Summary of proposed rule provisions: The Department proposed a 
technical correction to clarify that access for Departmental inspectors 
must be provided to all facilities and vessels used for activities 
authorized under this subpart. The Department also proposed requiring 
that certain records be retained until BOEM releases the associated 
financial assurance and that the lessee make these records available 
upon request.
    Summary of comments: BSEE did not receive any comments regarding 
this section.
    Summary of final rule revisions: The Department is finalizing this 
regulation, consistent with proposed Sec.  585.822. BSEE is revising 
paragraph (a)(1) to include the phrase ``and any vessels engaged in 
activities authorized under this part'' after the word ``grant'' to 
clarify the applicability of the regulations in this part to vessels. 
BSEE is also making minor edits to this section to apply the transfer 
of authority from BOEM to BSEE.
    Sec.  285.824 How must I conduct self-inspections?
    Summary of proposed rule provisions: The Department proposed 
requiring that an onsite inspection of each of facility be conducted at 
least once a year. The proposed revision allows the Department to have 
flexibility in conducting the annual onsite inspection required under 
the OCSLA. The Department suggested requiring that the inspection 
include all safety equipment designed to prevent or ameliorate fires, 
spillages, or other major accidents. The Department also proposed that 
the lessee maintain records of the facility inspections, summarize the 
results of those inspections, and provide the records and result 
summaries upon request.
    Summary of comments:
    Comment: A commenter suggested that the Department provide more 
information on the efficacy of self-inspections in relation to 
operational safety. A commenter stated that the Department should 
provide clarity on what should be included in a comprehensive self-
inspection plan. The commenter remarked that the scope of self-
inspections is expanded in the proposed rule to include ``all safety 
equipment designed to prevent or ameliorate fires, spillages, or other 
major accidents.'' However, this phrase is not illustrated or explained 
in the preamble to the rule.
    Response: BSEE has explained what must be included in self-
inspection plans in Sec.  285.824. BSEE is requiring that the self-
inspection plan development include performance-based evaluation and 
identification of equipment designed to prevent or ameliorate fires, 
spillages, or other major accidents. Requiring lessees to identify this 
equipment, which is now defined as ``Critical Safety Systems and 
Equipment'' in Sec.  285.112, allows for the regulatory requirements to 
remain adaptive to new and emerging technologies BSEE is committed to a 
compliance, risk, and performance-based inspection framework that is 
tailored to the operation, developer, location, and associated risk.
    Comment: Several commenters suggested that the Department provide 
more clarity on the level and type of inspections needed (consider 
allowing an independent inspection company to perform work on behalf of 
a lessee), and the possibility of remote inspections to reduce 
emissions and the overall exposure of industry and agency personnel 
offshore.
    Response: BSEE's inspection model is compliance, risk, and 
performance-based, and includes the option of remote monitoring 
technology, as well as the prescriptive annual onsite inspection 
required by the OCSLA. As performance-based inspection by lessees and 
operators using remote inspection technology is found to be successful 
in reducing risks to industry personnel, BSEE may consider future 
changes to inspection activities.
    Summary of final rule revisions:
    The Department is finalizing this regulation, consistent with 
proposed Sec.  585.824, with minor revisions. BSEE is revising 
paragraph (a)(1) to include ``tendon'' and ``tethering'' as components 
of systems for floating facilities to be inclusive of all mooring 
system types. BSEE is adding paragraph (a)(3) to clarify that your 
self-inspection plan must specify how you will fulfill the requirement 
for annual onsite inspection of all Critical Safety Systems and 
Equipment. BSEE is revising paragraphs (b)(1) and (2) to clarify 
inspection reporting and retention requirements. BSEE is also making 
minor edits to this section to apply the transfer of authority from 
BOEM to BSEE.
    BSEE responded to comments concerning inspections in Section III, 
I. above. Additional comments and responses regarding this provision 
are provided below.
    Sec.  285.830 What are my incident reporting requirements?
    Summary of proposed rule provisions: The Department proposed 
correcting an erroneous cross-reference in paragraph (d) to provide the 
appropriate BSEE regulatory citation for reporting oil spills.
    Summary of comments: BSEE did not receive any comments regarding 
this section.
    Summary of final rule revisions: The Department is finalizing this 
regulation, consistent with proposed Sec.  585.830. BSEE is revising 
paragraph (d) to include a citation to 30 CFR 250.187(d).
    Sec.  285.900 Who must meet the decommissioning obligations in this 
subpart?

[[Page 42681]]

    Summary of proposed rule provisions: The Department proposed 
subpart J requirements for decommissioning all facilities and 
obstructions on a lease, RUE, or ROW issued under the Department's 
renewable energy regulations. The Department proposed adding paragraph 
(c) establishing a limited exception to its proposed subpart J 
requirements for facilities that are approved by, and subject to the 
decommissioning requirements of, another Federal authority. This 
proposed amendment was intended to cover met buoys that would no longer 
require an SAP under proposed Sec.  585.600. Such buoys would be 
subject to the site clearance required by USACE and may be subject to 
financial assurance requirements on a case-by-case basis, prior to 
deployment, at the discretion of USACE. The Department proposed 
exercising its authority to enforce the decommissioning requirements in 
proposed subpart J and its enforcement options for noncompliance by 
lessees in proposed subpart E.
    Summary of comments:
    Comment: A commenter suggested that BOEM work with BSEE to develop 
enforcement procedures related to financial assurance in the event of a 
default. The commenter said that BOEM and BSEE should ensure 
performance of decommissioning obligations, maintain clear records of 
ownership, and develop regulations that would require BSEE to enforce 
decommissioning in reverse chronological order.
    Response: The NPRM did not propose changes to enforcement actions 
in the event of a default; therefore, changes to the final rule would 
be outside of the scope of the rulemaking. BSEE may consider this 
comment for future rulemakings.
    Summary of final rule revisions: The Department is finalizing this 
regulation, consistent with proposed Sec.  585.900. BSEE is revising 
this regulation to add paragraph (c) providing that if a lessee or 
grantee has installed a facility on a lease or grant that was 
authorized by an authority other than BOEM and that approving authority 
has imposed a decommissioning obligation, such obligation will 
substitute for the requirements of the subpart. The decommissioning 
requirements in this subpart will apply to such a facility if the 
authorizing agency has not imposed or enforced a decommissioning 
obligation.
    Sec.  285.902 What are the general requirements for decommissioning 
for facilities authorized under my SAP, COP, or GAP?
    Summary of proposed rule provisions: The Department proposed to 
order decommissioning of facilities earlier than two years following 
lease termination if the facilities are no longer useful for 
operations. The Department solicited comments on the meaning of the 
term ``no longer useful for operations'' and whether this was the best 
or most appropriate standard for the Department to use to describe 
facilities that should be required to be decommissioned.
    Summary of comments:
    Comment: Three commenters stated that the decommissioning process 
is unclear.
    Response: BSEE disagrees that these requirements are unclear. 
BSEE's regulations at 30 CFR part 285, subpart I, require that, within 
two years following termination of a lease or grant, the owner must 
decommission all facilities, projects, cables, pipelines, and 
obstructions on their lease. Section 285.906 specifies what the 
decommissioning application must include.
    Comment: A commenter requested additional information on the 
potential impacts of the change to tailored financial assurance amounts 
and instruments, specifically, regarding requirements to fund 
decommissioning and who is legally responsible for decommissioning.
    Response: The requirements on providing financial assurance are 
defined in 30 CFR part 585. The lessee(s) are legally responsible for 
decommissioning as defined in 30 CFR part 285, subpart I.
    Comment: A commenter recommended the addition of language regarding 
the mechanism for financial assurance for decommissioning if USACE does 
not require site clearance ahead of site assessment activities.
    Response: BSEE's regulations require that the buoy be 
decommissioned if the USACE does not require a decommissioning 
obligation. BSEE strengthened Sec.  285.900(c) to say, ``The 
decommissioning requirements in this subpart will apply to such a 
facility if the authorizing agency has not imposed or enforced a 
decommissioning obligation.'' BSEE expects to utilize its regulatory 
authority for decommissioning of buoys in limited circumstances.
    Summary of final rule revisions: The Department is finalizing this 
regulation, consistent with proposed Sec.  585.902. BSEE is revising 
paragraph (a) to include the phrase ``or earlier if BSEE determines a 
facility is no longer useful for operations'' after ``grant,'' and 
before ``, you must.'' In addition, BSEE is making minor edits to this 
section to apply the transfer of authority from BOEM to BSEE.
    Sec.  285.905 When must I submit my decommissioning application?
    Summary of proposed rule provisions: The Department proposed adding 
paragraph (e) to address the timing of applications pursuant to the 
proposed ``idle iron'' authority under Sec.  585.902.
    Summary of comments: BSEE did not receive any comments regarding 
this section.
    Summary of final rule revisions: BSEE is revising this section by 
adding paragraph (e), which specifies that a lessee must submit a 
decommissioning application 90 calendar days after BSEE determines a 
facility is no longer useful for operations. BSEE is also making minor 
edits to this section to apply the transfer of authority from BOEM to 
BSEE.

B. 30 CFR Part 585

Subpart A--General Provisions
    Sec.  585.100 Authority.
    The text of this section is unchanged from the version that was 
adopted in the Reorganization Rule, which states, ``The authority for 
this part derives from section 8 of the Outer Continental Shelf Lands 
Act (OCSLA) (43 U.S.C. 1337). The Secretary of the Interior delegated 
to the Bureau of Ocean Energy Management (BOEM) the authority to manage 
the development of energy on the Outer Continental Shelf (OCS) from 
sources other than oil and gas, including renewable energy, through the 
issuance of leases, easements, and right-of-way for activities that 
produce or support the production, transportation, or transmission of 
energy.''
    Please refer to the Other Proposed Changes in Part 585 and 
Potential Revisions to Regulations Governing Transmission sections of 
Section III above for a discussion of the public comments related to 
this section and BOEM's responses to those comments.
    Sec.  585.101 What is the purpose of this part?
    The language of this section is the same as what has been 
previously finalized as part of the Reorganization Rule, with the 
exception of minor grammatical edits. The Reorganization Rule removed 
references to Alternate Use RUEs. The Alternate Use RUEs are now 
addressed in 30 CFR part 586 of the regulations because they are not 
intended to be used solely for renewable energy and related projects. 
Consistent with the Reorganization Rule, the language of the final rule 
states that the purpose of part 585 is to: (a) Establish procedures for 
issuance and

[[Page 42682]]

administration of leases, right-of-way (ROW) grants, and right-of-use 
and easement (RUE) grants for renewable energy production on the OCS; 
(b) Inform relevant parties of their obligations when they undertake 
activities authorized in this part; and (c) Ensure that renewable 
energy activities on the OCS are conducted in a safe and 
environmentally sound manner, in conformance with the requirements of 
subsection 8(p) of OCSLA, other applicable laws and regulations, and 
the terms of the lease, ROW grant, or RUE grant.
    Paragraph (d) of this section, which provides that this part will 
not convey access rights for oil, gas, or other minerals, is unchanged.
    No substantive comments were received on this section of the rule.
    Sec.  585.102 What are BOEM's responsibilities under this part?
    Section 585.102(a) specifies that BOEM will authorize renewable 
energy activities in accordance with OCSLA subsection 8(p)(4), as 
implemented in Sec.  585.102(a)(1) through (12). In the final rule, 
BOEM is amending this regulation to clarify that none of the enumerated 
requirements is intended to outweigh or supplant any other and that 
BOEM needs to reach a rational balance among the factors, as determined 
by the Secretary. The final rule clarifies that no one factor or 
consideration, by itself, should outweigh the other relevant 
considerations to the extent they conflict or are otherwise in tension. 
The final rule also provides that BOEM's responsibility to prevent 
waste on the OCS also includes the obligation to prevent economic waste 
and physical waste of energy resources from sources other than oil and 
gas. Some of the aforementioned changes were made in response to 
comments, as discussed further in section K.3 above. The Reorganization 
Rule added ``and approved plans'' to paragraph (b) to clarify that BOEM 
will require compliance with approved plans as well as all applicable 
laws, regulations, other requirements, and the terms of the lease.
    Please refer to the Other Proposed Changes in Part 585 section of 
Section III above for a discussion of the public comments related to 
this section and BOEM's responses to those comments, as well as the 
revisions made to the proposed rule language in this final rule.
    Sec.  585.103 When may BOEM prescribe or approve departures from 
these regulations?
    Section 585.103 was first promulgated to allow BOEM to maintain 
programmatic flexibility while adapting to a new and changing industry 
by approving departures from regulatory requirements under certain 
limited circumstances.\18\
---------------------------------------------------------------------------

    \18\ See supra note 51, at 19653.
---------------------------------------------------------------------------

    This final rule adopts the proposed revisions to Sec.  585.103(a) 
introductory text and (a)(1) to specify that BOEM may prescribe or 
approve a departure from the regulations when BOEM deems the departure 
necessary because the applicable provisions as applied to a specific 
circumstance are impractical or unduly burdensome and the departure is 
necessary to achieve the intended objectives of the renewable energy 
program. In this way, BOEM will maintain flexibility to adapt the 
regulations to the unique circumstances of this new and evolving 
industry while retaining the consistency and integrity of the 
regulations as a whole.
    The departure provisions of the existing section were limited in 
scope to those regulatory provisions that apply to existing leases and 
grants. However, BOEM has applied departures not only to activities 
``on a lease or grant,'' but also to activities that occur before lease 
issuance (e.g., BOEM's planning and lease sale processes) and after 
lease termination (e.g., decommissioning, release of financial 
assurance). These changes would allow for such departures.
    Minor updates to the provisions of paragraphs (a)(2) through (4) 
were made for consistency with the revisions to paragraph (a). No 
changes are proposed to Sec.  585.103(b) that provides that an approved 
departure and its rationale must be consistent with subsection 8(p) of 
OCSLA, protect the environment and public health and safety, not impair 
the rights of third parties, and be documented in writing.
    Please refer to the Other Proposed Changes in Part 585 section of 
Section III above for a discussion of the public comments related to 
this section and BOEM's responses to those comments, as well as the 
revisions made to the proposed rule language in this final rule.
    Sec.  585.104 Do I need a BOEM lease or other authorization to 
produce or support the production of electricity or other energy 
product from a renewable energy resource on the OCS?
    Section 585.104 traces the statutory language of OCSLA in 
establishing that a lease, ROW, or RUE issued under this part is 
required in order to construct, operate, or maintain facilities that 
``produce or support production, transportation, or transmission of 
energy from sources other than oil and gas.'' \19\ This final rule does 
not adopt the language from the proposed rule stating that, ``for 
purposes of this section, site assessment activities are not considered 
to produce, transport, or support the generation of any energy 
products; and, therefore, such activities do not, by themselves, 
require a lease, easement or ROW.'' (88 FR 5992) That language implied 
that such activities would not be covered under BOEM's authority under 
OCSLA. While it is true that in this rule, BOEM has excluded buoys from 
the description of activities for which an approved SAP would be 
required, it would be an overstatement to say that such activities do 
not support the generation of energy. This revision is intended to 
clarify that an entity does not require a lease from BOEM to deploy a 
met buoy or tower for site assessment activities that are not located 
on an existing commercial lease. Under this final rule, BOEM will not 
require a separate lease for the deployment of simple buoys.\20\ The 
USACE may be the lead Federal permitting agency for such facilities 
under its existing legal authority, though other agencies may also have 
permitting or consultation requirements, such as NOAA (National Oceanic 
and Atmospheric Administration) under the National Marine Sanctuaries 
Act (NMSA). For instance, a permit may be required for proposed off-
lease site assessment activities that would occur within a national 
marine sanctuary. Additionally, under section 304(d) of the NMSA, 
Federal agencies must consult with NOAA before approving off-lease site 
assessment activities that are likely to destroy, cause the loss of, or 
injure any sanctuary resource.
---------------------------------------------------------------------------

    \19\ 43 U.S.C. 1337(p)(1)(C).
    \20\ BOEM would nonetheless require a commercial lessee seeking 
to install an on-lease met tower to submit an SAP in addition to the 
USACE permit, given the potential impacts that might be caused by 
such towers.
---------------------------------------------------------------------------

    Please refer to the Site Assessment Facilities section of Section 
III above for a discussion of the public comments related to this 
section and BOEM's responses to those comments, as well as the 
revisions made to the proposed rule language in this final rule.
    Sec.  585.105 What are my responsibilities under this part?
    In the final rule, BOEM adopted a minor modification proposed in 
the NPRM to strengthen the requirement for lessees to comply with all 
applicable laws, regulations, other requirements, the terms of the 
lease or grant under this part, reports, notices, approved plans, and 
any conditions imposed by BOEM. This would expand, strengthen, and 
clarify the language found in existing Sec.  585.105(d), requiring 
compliance only with the ``terms, conditions, and

[[Page 42683]]

provisions of all reports and notices submitted to BOEM, and of all 
plans, revisions, and other BOEM approvals, as provided in this part.'' 
The revised language requires that lessees and operators comply with 
all applicable laws and regulations, the terms of the lease or grant 
under this part; reports, notices, and approved plans prepared under 
this part; and any conditions imposed by BOEM through its review of any 
of these reports, notices, and approved plans, as provided in this 
part.
    Please refer to the Sec.  285.701 of this section for a discussion 
of the public comments related to this section and BSEE's responses to 
those comments. No changes were made in response to the comments.
    Sec.  585.106 What happens if I fail to comply with this part?
    The previous Sec.  585.400 was moved to Sec.  585.106 by the 
Reorganization Rule. This section provides that BOEM may take 
appropriate corrective action under this part if a lessee or operator 
fails to comply with applicable provisions of Federal law, the 
regulations in this part, other applicable regulations, any order of 
the Director, the provisions of a lease or grant issued under this 
part, or the requirements of an approved plan or other approval under 
this part.
    It further specifies that BOEM may issue a notice of noncompliance 
if it determines that there has been a violation of the regulations in 
this part, any order of the Director, or any provision of a lease, 
grant, or other approval issued under this part. When issuing a notice 
of noncompliance, BOEM will serve the offending party at its last known 
address.
    When issuing a notice of noncompliance, BOEM will inform the 
offending party how it failed to comply with this part, any order of 
the Director and/or the provisions of the lease, grant, or other 
approval, and will specify what must be done to correct the 
noncompliance and the time limits within which action must be taken. 
The failure of a lessee, operator, or grantee to take the actions 
specified in a notice of noncompliance issued under this part within 
the time limit specified provides the basis for issuance of a cessation 
order by BSEE, as provided in 30 CFR 285.401 and/or cancellation of the 
lease or grant by the Secretary as provided in Sec.  585.422.
    The final rule updates this section, as proposed, to clarify that 
BOEM may assess civil penalties, as authorized by section 24 of the 
OCSLA and as determined under the procedures set forth in 30 CFR part 
550, subpart N, if a company fails to comply with any provision of this 
part or any term of a lease, grant, or order issued under the authority 
of this part after notice of such failure and expiration of any 
reasonable period allowed for corrective action.
    Consistent with the Modernization Rule NPRM, the final rule now 
provides that civil penalties will be determined and assessed in 
accordance with the procedures set forth in 30 CFR part 550, subpart N, 
after notice of such failure and expiration of any reasonable period 
allowed for corrective action or if BOEM determines the failure 
constitutes, or constituted, a threat of serious, irreparable, or 
immediate harm or damage to life (including fish and other aquatic 
life), property, or the marine, coastal, or human environment. BOEM 
made minor revisions to this provision to ensure consistency with 
OCSLA.
    Please refer to the Lease Issuance Procedure and Other Proposed 
Changes in Part 585 sections of Section III above for a discussion of 
the public comments related to this section and BOEM's responses to 
those comments, as well as the revisions made to the proposed rule 
language in this final rule.
    Sec.  585.107 Who can acquire or hold a lease or grant under this 
part?
    BOEM is implementing several changes to its qualification 
requirements, as proposed and as a result of the Reorganization rule 
(88 FR 6376).
    First, this final rule replaces the word ``hold'' with ``acquire or 
hold'' throughout this section to clarify that the qualification 
requirements of Sec.  585.107 are intended to apply both to the 
acquisition and retention of both OCS lease and grant interests. BOEM 
does not require automatic forfeiture of a party's existing lease and 
grant interests if the lessee or grantee no longer meets the criteria 
in this section; rather, the provisions at Sec.  585.422 would be the 
appropriate vehicle for canceling a lease in these circumstances.
    Second, this final rule makes a grammatical correction to paragraph 
(a)(6) to list the citizenship qualifications in the disjunctive and 
not the conjunctive by removing ``and'' and replacing it with ``or''.
    Third, this final rule adds criteria that may disqualify a party 
from acquiring a lease or grant interest under this part and, 
consequently, from participation in the lease and grant issuance 
processes. This final rule will prevent a party that has been 
disqualified from acquiring a lease or grant interest (because it 
either lacks the basic regulatory qualifications or has engaged in 
certain enumerated misconduct) from participating in any lease or grant 
issuance processes under this part. This provision closes a loophole in 
paragraph (c) by prohibiting a party disqualified from acquiring a 
lease or grant interest from entering into commercial agreements to 
participate in the lease or grant issuance processes on behalf of a 
third party. BOEM also revised paragraph (c) to clarify BOEM's 
authority to disqualify a party from participating in an auction, which 
is not explicitly set forth in the existing regulations. These 
provisions are intended primarily to deter current and potential 
lessees and grantees from engaging in conduct that is illegal or 
detrimental to BOEM's renewable energy program and to the fair conduct 
of its auctions.
    A party under consideration for disqualification will receive 
written notice from BOEM of the basis for the disqualification and will 
be provided an opportunity to be heard before BOEM issues a final, 
appealable decision. BOEM also may instruct that party regarding what 
remedial actions, if any, would restore its qualification. Until such 
remedial actions are completed to BOEM's satisfaction or until 
qualification is otherwise restored, a disqualified party would be 
ineligible to acquire a lease or grant under this part or to otherwise 
participate in BOEM's competitive and noncompetitive lease or grant 
issuance processes.
    BOEM also added paragraph (d) to this section to provide that a 
lease may be held by one or more persons provided that all interest 
holders are eligible to hold a lease pursuant to this section and Sec.  
585.108. BOEM made this addition to support the revisions to the lease 
structure, assignment and segregation provisions included in the NPRM 
and final rule. These final rule provisions were proposed and finalized 
in support of BOEM's goal of providing lessees with more flexibility 
throughout the lease development process.
    Please refer to the Lease Issuance Procedure section of Section III 
above for a discussion of the public comments related to this section 
and BOEM's responses to those comments.
    Sec.  585.108 How do I show that I am qualified to be a lessee or 
grant holder?
    BOEM is implementing a technical correction to paragraph (b), as 
specified in the Reorganization rule (88 FR 6376), to reflect that the 
Immigration and Naturalization Service no longer exists and to avoid 
the need for future technical corrections in the event of another 
change in the name of the relevant Federal immigration authority.
    No comments were received on this section of the rule.
    Sec.  585.109 When must I notify BOEM if an action has been filed 
alleging that I am insolvent or bankrupt?

[[Page 42684]]

    This section is unchanged from the existing regulation, except for 
being renumbered.
    No comments were received on this section of the rule.
    Sec.  585.110 When must I notify BOEM of mergers, name changes, or 
changes of business form?
    This section is unchanged from the existing regulations, except for 
being renumbered. No comments were received on this section of the 
rule.
    Sec.  585.111 How do I submit plans, applications, reports, or 
notices required by this part?
    In the final rule, BOEM adopted the proposed changes to this 
section to eliminate its paper copy requirement and henceforth to rely 
primarily on electronic submissions. The paper requirement has proven 
unwieldy for voluminous plan submittals that contain multiple 
appendices and may be subject to multiple revisions before they are 
finalized.
    BOEM reserves the authority to require paper copies of certain 
documents (such as maps and charts), if necessary.\21\ This final rule 
also eliminates specific BOEM mailing addresses to avoid the need for 
future technical corrections if BOEM's mailing address were to change 
again. Instead, the mailing addresses for submissions will be listed on 
BOEM's website. No comments were received on this section of the rule.
---------------------------------------------------------------------------

    \21\ BOEM proposes to retain the paper copy requirement for 
assignment applications given the importance of having an original 
signed version. See discussion infra VI.E Sec.  585.408.
---------------------------------------------------------------------------

    Sec.  585.112 When and how does BOEM charge me processing fees on a 
case-by-case basis?
    Under this final rule, BOEM will charge a processing fee on a case-
by-case basis under the procedures in this section with regard to any 
application or request under this part if it decides at any time that 
the preparation of a particular document or study is necessary for the 
application or request and it will have a unique processing cost, such 
as the preparation of an environmental assessment (EA) or EIS. The rule 
specifies that processing costs will include contract oversight and 
efforts to review and approve documents prepared by contractors, 
whether the contractor is paid directly by the applicant or through 
BOEM, applying a standard overhead rate to direct processing costs.
    BOEM may assess the ongoing processing fee for each individual 
application or request under the following circumstances: before 
processing any application or request, BOEM will provide a written 
estimate of the proposed fee based on reasonable processing costs. BOEM 
will allow comment on the proposed fee; lessee and operators may then 
ask for BOEM's approval to create, or to directly pay a contractor to 
create, all or part of any document, study, or other activity according 
to standards we specify, thereby reducing our costs for processing an 
application or request; or ask to pay us to perform, or contract for, 
all or part of any document, study, or other activity.
    BOEM will provide the final estimate of the processing fee amount 
with payment terms and instructions after considering the lessee's 
comments and any BOEM-approved work that will be done. If BOEM 
encounters higher or lower processing costs than anticipated, we will 
re-estimate our reasonable processing costs. Once processing is 
complete, BOEM will refund the amount of money that was not spent on 
processing costs.
    Lessees and operators must pay the entire fee before BOEM will 
issue the final document or take final action on an application or 
request, subject to the appeal rights specified in accordance with the 
regulations in 43 CFR part 4. BOEM will not process the document 
further until the appeal is resolved unless the fee is paid under 
protest while the appeal is pending. If the appeal results in a 
decision changing the proposed fee, we will adjust the fee in 
accordance with paragraph (b)(5) of this section, which BOEM has 
consolidated into one paragraph in the final rule instead of it being 
divided by paragraphs (b)(5)(i) and (ii). If BOEM adjusts the fee 
downward, it will not pay interest. Otherwise, this section is as 
proposed and is unchanged from the existing regulations. No comments 
were received on this section of the rule.
    Sec.  585.113 Definitions.
    This final rule modifies the definitions for the following terms, 
in accordance with the proposals outlined in the NPRM, or to match the 
definition changes that have already been adopted in connection with 
the final Reorganization Rule: ``affected local government,'' 
``affected State,'' ``best management practices,'' ``multiple factor 
auction,'' and ``we.''
    This final rule, as proposed, adds a definition for ``bidding 
credits.'' Bidding credits are defined as the value assigned by BOEM, 
expressed in monetary terms, to the factors or actions demonstrated, or 
committed to, by a bidder at a BOEM lease auction during the 
competitive lease award process. The regulations further specify that 
the types and values of any bidding credits awarded to any given bidder 
will be set forth in the FSN.
    This final rule adds a new definition for ``coastal environment'' 
to mean ``the physical atmospheric, and biological components, 
conditions, and factors which interactively determine the productivity, 
state, condition, and quality of the terrestrial ecosystem from the 
shoreline inward to the boundaries of the coastal zone.'' The term 
``coastal environment'' is used in the existing regulations and its use 
is continued in these revised regulations in provisions that refer to 
the marine, coastal, and human environments. However, the term is not 
defined in the existing regulations even though the ``marine 
environment'' and the ``human environment'' are defined in them. All 
three terms are defined in the OCS Lands Act itself, and so we have 
included the statutory definition for ``coastal environment'' in these 
regulations. This should not add any burden to lessees since the 
statutory definition has been the reference point for its meaning in 
the absence of a definition in the regulations. Adding the definition 
simply clarifies that point.
    This final rule modifies the definition of ``commercial 
activities'' to state that such activities are conducted ``under'' 
leases and grants rather than ``for'' them. This clarifies that 
commercial activities as defined in the rule apply only to on-lease or 
on-grant activities, and not off-lease or off-grant activities by 
commercial lessees and grantees.
    This final rule revises the definition for ``Critical Safety 
Systems and Equipment'' to mean safety systems and equipment designed 
to prevent or ameliorate fire, spillages, or other major accidents that 
could result in harm to health, safety, or the environment in the area 
of your facilities. This modification was made to be consistent with 
BSEEs' definition of the same term in Sec.  285.112.
    The final rule does not include the proposed addition of the term 
``engineered foundation'' and its definition ``any structure installed 
on the seabed using a fixed-bottom foundation constructed according to 
a professional engineering design (based on an assessment of 
sedimentary, meteorological, or oceanographic conditions).'' The 
proposed definition in the NPRM was only meant to apply to the SAP 
provisions of the regulations and the addition of a general definition 
of ``engineered foundations'' had the potential to cause confusion 
throughout the other provisions. Furthermore, the in-text revisions to 
the SAP regulations include the substance of this definition, which 
makes its inclusion under Sec.  585.113 duplicative and unnecessary.

[[Page 42685]]

    This final rule also revises the definition for the term 
``fabrication'' proposed in the NPRM, which is defined in this final 
rule to mean ``the cutting, fitting, welding, or other assembly of 
project elements.'' The modification was made to be consistent with the 
definition provided in BSEE's regulations in Sec.  285.112.
    This final rule revises the definition of ``geographic center of a 
project'' to address the ambiguity by removing references to ``mapping 
system'' and ``system''.
    This final rule adds definitions for the terms ``lease area'' and 
``provisional winner'' to provide clarity in the regulatory text. 
``Lease area'' means ``an OCS area identified by BOEM for potential 
development of renewable energy resources''. The ``provisional winner'' 
means the bidder that BOEM determines at the conclusion of the auction 
to have submitted the highest bid. The provisional winner would become 
the winning bidder upon favorable completion of the government's post-
auction reviews.
    This final rule adds a new definition of ``multiple factor 
auction,'' which is defined to mean an auction that involves the use of 
bidding credits to incentivize goals or actions that support public 
policy objectives or maximize public benefits through the competitive 
leasing auction process. In all multiple factor auctions, BOEM would 
add the monetary value of the bidding credits to the value of the cash 
bid to determine the highest bidder.
    This final rule amends the definition of ``Outer Continental Shelf 
(OCS)'' to incorporate the amendment to that term by the IRA, which 
expanded the OCS to include lands within the exclusive economic zone of 
the U.S. and adjacent to any territory of the U.S, except any area 
conveyed by Congress to a territorial government for administration. 
(IRA Sec. 50251(b)(1)).
    The final rule includes several revisions to the definition of 
``project easement.'' The revised definition states ``project 
easement'' means an easement to which, upon approval of your 
Construction and Operations Plan (COP) or General Activities Plan 
(GAP), you are entitled as part of the lease for the purpose of 
installing, maintaining, repairing and replacing: gathering, 
transmission, and distribution, and inter-array cables; power and 
pumping stations; facility anchors; pipelines; and associated 
facilities and other appurtenances on the OCS as necessary for the full 
enjoyment of the lease. The addition of ``maintaining, repairing and 
replacing''; and ``inter-array'', ``power and pumping stations'', and 
``facility anchors'' all support the implementation of BOEM's proposed 
changes to Sec.  585.628(g)(1), which allow BOEM to approve project 
easements of ``sufficient off-lease area to accommodate potential 
changes at the design and installation phases of the project for 
locating cables, pipelines, and other appurtenances necessary for your 
project.'' BOEM received comments in support of these changes.
    This rule also finalizes the new definition of ``receipt'' of a 
document, as proposed in the NPRM, which is deemed to have taken place, 
in the absence of documentation to the contrary, (a) 5 business days 
after the document was given to a mail or delivery service with the 
proper address and postage; or (b) on the date the document was sent 
electronically. This definition borrows from the Interior Board of Land 
Appeals (IBLA) regulation on service of documents at 43 CFR 4.401(c)(7) 
but acknowledges that most documents will be transmitted 
instantaneously through electronic means. In the absence of 
documentation evincing actual receipt, the presumption of constructive 
receipt in this definition would be overcome by evidence demonstrating 
that a document was either not received or received in more or less 
time than the default timeframes set forth. The definition of 
``receipt'' would apply to variants of that word, including variants of 
``receive,'' and would apply only where those terms are used in the 
regulations to describe the receipt of a document when the timing of 
receipt triggers a regulatory time period or consequence.
    BOEM is revising the definition of ``site assessment activities'' 
to distinguish site assessment activities from site characterization 
activities.
    The final rule adds a definition ``you and your'' to explain the 
terms.as specified in the Reorganization rule (88 FR 6376).
    Sec.  585.114 How will data and information obtained by BOEM under 
this part be disclosed to the public?
    BOEM is implementing a technical change in this section, 
substituting the word ``commencement'' for ``initiation'' in paragraph 
(b)(1) for consistency with the remainder of BOEM's offshore renewable 
regulations.
    No comments were received on this section of the rule.
    Sec.  585.115 Paperwork Reduction Act statements--information 
collection.
    The final rule updates the table in this section to align with 
proposed paragraph (e) of Sec.  585.115 in the NPRM. This final rule 
reorders the subparts in the table to reflect the updated listing of 
subparts in the NPRM as a result of the addition of a new subpart B, 
and to remove from the list subparts H through J, authority for which 
has been transferred to BSEE, and subpart K, the contents of which have 
been included in new part 586.
    No substantive comments were received on this section of the rule.
    Sec.  585.116 Requests for information.
    The existing regulations reference two public information requests 
that share the same acronym: requests for interest (RFI) under 
Sec. Sec.  585.210 and 585.231, and requests for information (RFI) 
under Sec.  585.116. This final rule combines all such notices in 
revised Sec.  585.116 and refers to them as requests for information. 
The request for interest is an optional step in the leasing process 
that assists BOEM in collecting information in advance of initiating a 
new leasing process. BOEM used the request for interest in this way 
several times, especially early in the program. However, more recently, 
the practice has been to initiate the leasing process with the first 
mandatory step in the leasing process, publishing a Call. This final 
rule has eliminated the request for interest as a step in the leasing 
process. In the event that BOEM would like to start the leasing process 
with a solicitation of information from the public, the more general 
request for information under Sec.  585.116 will be available to serve 
that need. No substantive comments were received on this section of the 
rule.
    Sec.  585.117 Severability.
    BOEM's existing regulations do not contain a severability provision 
nor did BOEM propose one in the NPRM. However, in this final rule BOEM 
has included a severability provision in new Sec.  585.117 as follows: 
``If a court holds any provisions of this part or their applicability 
to any persons or circumstances invalid, the remainder of the 
provisions and their applicability to any persons or circumstances will 
not be affected.'' While BOEM has determined that all of these sections 
can and do function separately, BOEM understands that a court will 
ultimately determine whether portions of the rule can be severed from 
others. In the event a court determines a provision was improperly 
promulgated, this section is designed to aid that review by 
demonstrating that BOEM intends the various components of this final 
rule, with various provenances and independent functions, to continue 
to operate even if one or more of the provisions is declared unlawful.
    Sec.  585.118 What are my appeal rights?
    The final rule adopts the proposed revisions to this section in the 
NPRM.

[[Page 42686]]

BOEM's existing renewable energy regulations discussed appeal rights in 
two sections--Sec. Sec.  585.118 and 585.225. Section 585.118 described 
the right to appeal BOEM final decisions made under part 585 to the 
IBLA, whereas Sec.  585.225 provided that a bidder may request the 
Director to reconsider its bid rejection but cannot appeal that 
decision to the IBLA. To simplify and clarify the administrative review 
provisions, this final rule has combined these two sections by locating 
all procedures for review of BOEM renewable energy final decisions or 
orders in revised Sec.  585.118. This revised section maintains the 
distinction between requesting reconsideration of rejected bids and 
appeals of other final decisions made under part 585, but now 
characterizes challenges to decisions selecting provisional winners as 
appeals to the Director, rather than requests for reconsideration.
    This section provides appeal rights to any adversely affected 
bidder of a provisional winner selection decision. Previously, Sec.  
585.225(b) limited requests for reconsideration to those with rejected 
bids. The revised Sec.  585.118 will also provide provisional winners 
an opportunity to appeal if they believe there have been any errors or 
omissions in the selection decision, such as miscalculated or unapplied 
bidding credits.
    This section specifies that BOEM must receive written appeals of a 
decision selecting the provisional winner within 15 business days after 
a bidder receives notice of the decision. This is consistent with the 
existing regulations at Sec.  585.225(b) and clarifies the language of 
the existing Sec.  585.118(c)(1). This section adopts the rules found 
in the appeal procedures at 30 CFR 590.3 of this chapter for 
determining when a selection decision is received.
    Finally, this revised section clarifies two points regarding an 
appeal of a decision selecting the provisional winner. First, the 
provisional winner will have an opportunity to be heard before the BOEM 
Director reverses a selection decision. Second, the Director's decision 
will no longer be appealable administratively to the IBLA. No comments 
were received on this section of the rule.
    Sec. Sec.  585.119-585.149 [Reserved]

C. 30 CFR Part 585, Subpart B--The Renewable Energy Leasing Schedule

    Sec.  585.150 What is the Renewable Energy Leasing Schedule?
    BOEM has added a new subpart and section to the regulations, as 
proposed, that define a proposed leasing schedule for the renewable 
energy program. BOEM has determined that a new subpart is appropriate 
given the nature of this change and the potentially significant benefit 
to stakeholders. This schedule would include a list of locations under 
consideration for leasing and a schedule that BOEM would follow in 
holding its future renewable energy lease sales. According to this 
subpart, at least once every two years, the Secretary will publish this 
schedule of proposed lease sales. The first published schedule would be 
issued for the five-year period following the effective date of this 
rulemaking and subsequent schedules will cover the five-year period 
after the update. This schedule will include a general description of 
the area of each proposed lease sale, the calendar year in which each 
lease sale will occur, and the reasons for any changes made to the 
previous schedule. Any proposed leasing schedule or event would 
continue to be subject to all applicable regulations, including area 
identification, coordination with relevant parties, and applicable 
environmental reviews.
    BOEM seeks to improve transparency regarding the government's 
intentions for future offshore wind leasing without proliferating 
requirements for BOEM, industry or the public. It is a commitment for 
the agency to openly communicate in good faith approximately where and 
when it plans to shift its gaze for area identification and leasing. It 
does not bind the agency to engage in specific additional public 
engagement or process to inform the schedule and allows flexibility to 
modify a schedule after publication.
    Please refer to the Renewable Energy Leasing Schedule section of 
Section III above for a discussion of the public comments related to 
this section and BOEM's responses to those comments.
    Sec. Sec.  585.151-585.199 [Reserved]

D. 30 CFR Part 585, Subpart C--Issuance of OCS Renewable Energy Leases

General Lease Information
    Subpart B, Issuance of OCS Renewable Energy Leases, is being 
redesignated as subpart C to accommodate the addition of a new subpart 
B, as noted above. The individual section numbers in subpart C and in 
subsequent subparts have not been changed.
    Sec.  585.200 What rights are granted with a lease issued under 
this part?
    No changes were proposed for this section. This final rule adds no 
additional changes. BOEM received no comments on this section.
    Sec.  585.201 How will BOEM issue leases?
    No changes were proposed for this section. This final rule adds no 
additional changes. BOEM received no comments on this section.
    Sec.  585.202 What types of leases will BOEM issue?
    BOEM has finalized the proposed technical revision to this section 
to make it consistent with subsection 8(p) of OCSLA. BOEM also added a 
citation, as proposed, to Sec.  585.239 for leases issued for renewable 
energy research activities. BOEM received no comments on whether to 
include research leases as a type of lease that BOEM may issue.
    Sec.  585.203 With whom will BOEM consult before issuance of 
leases?
    BOEM finalized several edits to this section; some were proposed in 
the NPRM and others were not. BOEM made technical and editorial 
corrections to improve readability. BOEM added the Native Hawaiian 
Community and Alaskan Native Corporations to the list of entities that 
BOEM consults with before the issuance of leases, after a commenter 
pointed to the absence of the Native Hawaiian Community. Also, in the 
first sentence of this section, BOEM reordered the list of entities 
with which BOEM must consult such that Tribes are mentioned ahead of 
states to represent the special status of Tribal governments.
    Sec.  585.204 What areas are available for leasing consideration?
    No changes were proposed for this section. The final rule adds no 
additional changes. BOEM received no comments on this section.
    Sec.  585.205 How will leases be mapped?
    No changes were proposed for this section. The final rule adds no 
additional changes. BOEM received no comments on this section.
    Sec.  585.206 What is the lease size?
    No changes were proposed for this section. The final rule adds no 
additional changes. BOEM received no comments on this section.
    Sec. Sec.  585.207-585.209 [Reserved]
Competitive Lease Award Process--Pre-Auction Provisions
    Sec.  585.210 What are the steps in BOEM's competitive lease award 
process?
    Section 585.210 provides an overview of the competitive leasing 
process and effectively merges existing Sec. Sec.  585.210 and 585.211. 
This final rule replaces, as proposed, the request for interest in the 
existing Sec.  585.210 with a request for information in the revised 
Sec.  585.116. The revised Sec.  585.210 now provides an

[[Page 42687]]

overview of the entire competitive leasing process by including two 
steps that are not currently mentioned in the existing section: the 
auction and lease award. Please refer to the Lease Issuance Procedure 
section of Section III above for a discussion of the public comment 
related to this section and BOEM's responses to those comments.
    Sec.  585.211 What is the Call?
    Section 585.211 consolidates, as proposed, existing Sec. Sec.  
585.211(a), 585.213, and 585.214, which describe the information 
requested by the Call, the information a respondent should include in 
its response if it wishes to nominate one or more areas for a 
commercial renewable energy lease within the preliminarily identified 
leasing areas, and BOEM's handling and processing of the information 
received. The primary purpose of this change is reorganization; no 
substantive changes have been made to BOEM's existing regulations and 
practice. BOEM has removed the reference to withholding privileged and 
confidential information as being redundant with the protections 
already described in Sec.  585.114. Please refer to the Lease Issuance 
Procedure section of Section III above for a discussion of the public 
comment related to this section and BOEM's responses to those comments.
    Sec.  585.212 What is area identification?
    Section 585.212 provides more clarity regarding BOEM's area 
identification process, thus expanding the description of this step in 
Sec.  585.210(b)(2), largely as proposed. BOEM otherwise has not made 
any substantive change to the existing process. Please refer to the 
Lease Issuance Procedures section of Section III above for a discussion 
of the public comments related to this section and BOEM's responses to 
those comments, as well as the revisions made to the proposed rule 
language in this final rule.
    This section clarifies that BOEM balances potential OCS renewable 
energy development with competing uses and environmental concerns 
during area identification and attempts to resolve foreseeable issues. 
Consistent with the existing regulations and practice, BOEM will 
determine during area identification whether specific OCS areas are 
suitable for further consideration for renewable energy development 
with appropriate mitigation.
    BOEM will consider any factors that it determines relevant during 
this process. These factors may include, but would not necessarily be 
limited to, other uses in and around the area, applicable environmental 
analysis, formal and informal stakeholder comments, industry 
nominations, and the area's feasibility for development. Consideration 
of the area's feasibility for development could include, but would not 
be limited to, analysis of the area's size and other relevant physical 
conditions, potential electrical generation capacity, pertinent 
technical data, and applicable electricity market and offtake 
information. For example, BOEM may incorporate a high-level assessment 
of an area's characteristics that would be relevant to potential 
development, such as bathymetry, distance to shore, and wind resources, 
and may consider an adjacent State's offshore wind energy offtake or 
incentive programs.
    BOEM retains the flexibility to modify the selection of parcels 
offered for leasing after area identification and before the auction. 
Also consistent with the existing regulations, BOEM will use the area 
identification process to inform its NEPA review and associated 
interagency consultations to evaluate the potential effects of 
activities that are expected to take place after lease issuance on the 
human, marine, and coastal environments and on other environmental 
requirements. The NMSA may apply to any actions that may injure 
sanctuary resources or that may require permits for placement of 
equipment or disturbance of covered submerged lands. In any case where 
a NMSA permit may be required, NOAA may require certain financial 
assurances for infrastructure removal activities potentially required 
under permit. BOEM may continue to develop lease stipulations or other 
measures as part of its NEPA review to mitigate potential adverse 
impacts and may hold public hearings regarding its environmental 
analyses after potential lease areas have been identified.
    Commenters noted that BOEM changed the use of the word ``will'' to 
``may'' in paragraph (c)(3) of this section and requested that we 
change it back.\22\ As a result, BOEM is not carrying forward this 
change in the final rule. BOEM added a clarification that while 
mitigation measures and stipulations are identified during the Area 
Identification process, they continue to be identified throughout later 
environmental reviews and consultations and may not be published until 
the PSN.
---------------------------------------------------------------------------

    \22\ BOEM's existing regulations as published in 2009 at Sec.  
585.211(b)(2): ``we will evaluate the potential effect of leasing on 
the human, marine and coastal environments and develop measures to 
mitigate adverse impacts including lease stipulations'' and Sec.  
585.211(b)(3): ``we will consult to develop measures, including 
lease stipulations and conditions, to mitigate adverse impacts on 
the environment.'' Contrast with the NPRM at Sec.  585.212(c)(1): 
``BOEM may develop measures, including lease stipulations, to 
mitigate potential adverse impacts.''
---------------------------------------------------------------------------

    Sec.  585.213 What information is included in the PSN?
    The NPRM analyses of the proposed sections on the PSN and the FSN, 
Sec. Sec.  585.213 and 585.214, respectively, emphasized the close 
interrelationship between the notices, and how the first enhanced an 
understanding of the second.
    The PSN and FSN are closely related, but separate and distinct 
notices published in the Federal Register that detail the auction 
procedures and lease provisions relevant to a particular lease sale. 
The PSN proposes procedures and provisions and invites public comment 
on them, whereas the FSN establishes the final procedures and 
provisions. BOEM uses the public comments received in response to the 
PSN to inform its decisions regarding the final procedures and 
provisions in the FSN.
    With this final rule, Sec. Sec.  585.213 and 585.214 will replace, 
as proposed, the information currently contained in Sec.  585.216 of 
the existing regulations. These sections do not change substantially 
the nature, scope, or content of the PSN and FSN from BOEM's existing 
regulations and practice. However, these new sections clarify BOEM's 
existing authority to set a maximum number of lease areas that an 
individual party may bid on or acquire in an auction. This final rule 
separates the PSN and FSN regulations into individual sections because, 
although the notices are closely related, each notice represents a 
distinct step in the leasing process. The PSN and FSN continue to serve 
as the primary sources of information for prospective bidders on the 
lease areas, auction procedures, and lease provisions. In addition, 
Sec.  585.223 outlines supplemental auction information that BOEM may 
be provide in a PSN or FSN.
    Please refer to the Lease Issuance Procedures section of Section 
III above for a discussion of the public comments related to this 
section and BOEM's responses to those comments.
    Sec.  585.214 What information is included in the FSN?
    The same changes were made to Sec.  585.214 that were made in Sec.  
585.213, as described in the proposed rule. Please refer to the 
section-by-section analysis of Sec.  585.213 above for a description of 
those changes and to the Lease Issuance Procedures section of Section 
III of this preamble for a discussion of the public comments and BOEM's 
responses to those comments for this section.

[[Page 42688]]

    As noted in the response to comments section M.3, in response to 
suggestions to use particular bidding credits, such as one to promote 
shared transmission lines, BOEM develops and proposes any bidding 
credits in the PSN, and later confirms their use in the FSN, which 
allows for comments and potential modification. Such credits could be 
offered in future lease sales when deemed appropriate, however, this is 
beyond the scope of the current rulemaking.
    Sec.  585.215 What may BOEM do to assess whether competitive 
interest for a lease area still exists before the auction?
    BOEM's existing regulations at Sec.  585.212 explain the process 
BOEM follows if it had a reason to believe competitive interest no 
longer existed before the FSN was issued. The revised Sec.  585.215, as 
proposed, maintains the same process for determining whether 
competitive interest remains and for acting on that determination. This 
section clarifies, however, that BOEM may implement this process any 
time before the auction when it has reason to believe competitive 
interest is absent. BOEM may proceed with an auction regardless of the 
result of its competitive interest inquiry under this section. BOEM did 
not receive comments on this section.
    Sec.  585.216 How are bidding credits awarded and used?
    As proposed and now made final, Sec.  585.216 allows the 
provisional winner's bid to include the value of any bidding credits 
awarded if the provisional winner has made certain demonstrable 
commitments that facilitate OCS renewable energy development and that 
reflect a developmental advantage, or advance public policy. For 
instance, a power purchase agreement. The PSN and FSN will prescribe 
the use of bidding credits in a particular auction, including 
eligibility requirements, application procedures, and the types and 
values of available credits. BOEM would retain discretion not to offer 
bidding credits in any given auction.
    A bidder will be awarded bidding credits before the auction if it 
timely submits a bidding credit application that includes the requisite 
commitments and meets eligibility requirements under the FSN and part 
585. Depending on the FSN provisions, a bidder might be eligible for 
multiple bidding credits if the bidder meets the criteria for each 
credit. The FSN could provide for bidding credits that are 
``stackable'' or ``non-stackable.'' Stackable credits are those where 
the total value of one's bidding credits would be the sum of all the 
credits for which the bidder was eligible. Alternatively, the FSN may 
limit the bidding credits to non-stackable credits, where the total 
value of a bidder's bidding credits would be limited to the value of 
the largest bidding credit for which the bidder was eligible. Stackable 
credits would incentivize bidders to meet the criteria for as many of 
the available bidding credits as they can. Alternatively, using non-
stackable credits would limit the total value of the non-monetary 
component of the bid. Bidding credits may be denominated as either a 
sum certain or a percentage of the bid, as specified in the FSN.
    The FSN specifies the procedures, timing, and eligibility 
requirements for bidding credits. BOEM will inform bidders before the 
auction of the value of each bidding credit for which they are 
eligible. A provisional winner who received bidding credits would pay 
its bonus as the amount of the cash component of its winning bid less 
the bid deposit, as prescribed in the FSN. Paragraph (b) of this 
section further specifies that the qualification process to obtain 
bidding credits must be done in advance of any lease auction, in 
accordance with the specifications of the FSN; however, such 
qualifications may be obtained either for actions that the bidder has 
already undertaken or for actions that it has committed to undertake in 
the future, provided that BOEM has agreed to the terms by which such a 
commitment will be made. If a bidder receives a bidding credit for a 
commitment to future action, acceptance of the lease would constitute 
an obligation to undertake those actions, and failure to do so would 
constitute noncompliance with the lease.
    In response to comments on whether the regulations should codify 
BOEM's past practice of imposing a cap on the value of bidding credits 
that any bidder can earn, measured as either an absolute dollar amount 
or as a percentage of the bid amount, BOEM did not include a cap or 
limit but expects to continue its practice of limiting bidding credits 
to a maximum of 25 percent of the value of the high bid unless BOEM 
determines that a higher bidding credit is warranted for a particular 
sale. In Sec.  585.216(b), BOEM listed a half dozen examples of bidding 
credits that BOEM could use in future lease sales. Commenters suggested 
others, and in many cases asked that BOEM include them in the list of 
examples provided. BOEM did not include these in the list, but it's 
authority to include such bidding credits in future sales is preserved 
by Sec.  585.216(b)(7), which permits to offer bidding credits for 
``any other factor or criteria to further development of offshore 
renewable energy, as identified by BOEM in the PSN and FSN.''
    Please refer to the Lease Issuance Procedures section of Section 
III above for further discussion of the public comments related to this 
section and BOEM's responses to those comments.
    Sec. Sec.  585.217-585.219 [Reserved]
Competitive Lease Award Process--Auction Provisions
    Sec.  585.220 How will BOEM award leases competitively?
    BOEM is planning to continue to implement multiple factor auctions, 
through the use of bidding credits, to allow the competitive lease 
award process to take into consideration various priority actions, such 
as advancing a domestic supply chain and workforce training, consistent 
with the goals of OCSLA. As noted previously, bidding credits represent 
a monetary value assigned by BOEM to the actions or factors 
demonstrated or committed to by a bidder at a BOEM lease auction during 
the competitive lease award process. The value of the bidding credits 
would be added to the value of the cash bid to determine who is the 
highest bidder.
    The existing regulations at Sec. Sec.  585.220 through 585.222 set 
forth options that BOEM could have used for auction formats, bidding 
systems, and bid acceptance criteria for both commercial and limited 
leases. As discussed in section Lease Issuance Procedures section of 
Section III, these regulations were overly prescriptive and required 
clarification and modification to provide BOEM with flexibility to 
adopt new and innovative auction processes and procedures. Revised 
Sec.  585.220, as was proposed, replaces those sections with a 
simplified and flexible approach that would allow BOEM to use any 
auction process, including multiple factors, and any procedure that is 
objective, fair, reasonable, and competitive; awards a lease based upon 
the highest total bid; and provides a fair return to the United States. 
This section also clarifies that the specific process for each auction 
will be noticed in the PSN and, subject to revisions, finalized in the 
FSN.
    Sec.  585.221 What general provisions apply to all auctions?
    As was proposed, this revised section sets forth the provisions and 
rules applicable to all auctions. This section codifies the existing 
practice whereby BOEM conducts an auction if it determines, after the 
Call, that competitive interest exists for renewable energy development 
on parcels of the OCS and decides to issue leases within those areas. 
Section 585.221 codifies the

[[Page 42689]]

use of the FSN to prescribe the detailed process for any auction.
    Section 585.221(d) adds details to outline the circumstances under 
which BOEM may delay, suspend, cancel, and restart an auction due to a 
natural or man-made disaster, technical malfunction, security breach, 
unlawful bidding activity, administrative necessity, or any other 
reason that BOEM determines may adversely affect the fair and efficient 
conduct of the auction. Section 585.221(d) also adds a provision that 
authorizes BOEM to restart the auction at whatever point it deems 
appropriate, reasonable, fair, and efficient for all participants; or, 
alternatively, cancel the auction in its entirety.
    Sec.  585.222 What other auction rules must bidders follow?
    Section 585.222 establishes a set of procedures and rules of 
conduct for bidders, as proposed. This section is consistent with 
BOEM's existing practices, including requirements that bidders submit 
bid deposits in accordance with Sec.  585.501 and meet Sec. Sec.  
585.107 and 585.108 qualification requirements. If the awarded lease is 
executed by an agent acting on behalf of the bidder, the bidder must 
submit, along with the executed lease, written evidence that the agent 
is authorized to act on behalf of the bidder, as is already required 
under existing Sec.  585.224(g).
    Please refer to the Lease Issuance Procedure section of Section III 
above for a discussion of the public comments related to this section 
and BOEM's responses to those comments, as well as the revisions made 
to the proposed rule language in this final rule.
    Sec.  585.223 What supplemental information will BOEM provide in a 
PSN and FSN?
    Consistent with the proposed rule, section 585.223 contains a non-
exhaustive list of supplemental auction details likely to be contained 
in a PSN and FSN. Although this section lacks an analogue in the prior 
regulations, the supplemental details listed in this section generally 
are consistent with the information that BOEM has provided in recent 
PSNs and FSNs. This section clarifies the concept of the next highest 
bidder and describes the process to determine the next best bid if the 
provisional winner fails to meet its obligations or is otherwise unable 
to acquire the lease. The next best bidder criteria will be detailed in 
the PSN and FSN. BOEM did not receive comments on this section.
Competitive Lease Award Process--Post-Auction Provisions
    Sec.  585.224 What will BOEM do after the auction?
    Section 585.224 finalizes the NPRM proposal and outlines the steps 
that BOEM will take following the end of an auction. The revisions to 
this section make explicit existing practices that are consistent with 
OCSLA and that have proven effective in BOEM's auctions thus far. 
Section 585.224 retains BOEM's existing authority in Sec. Sec.  
585.222(a)(2) and 585.224(f) to reject and accept bids and to withdraw 
lease areas between auction completion and lease execution. Finally, if 
an auction results in unsold lease areas, revised Sec.  585.224 
clarifies that BOEM has the discretion to re-auction those unsold areas 
after the auction by restarting the competitive leasing process at any 
reasonable and appropriate step in that process.
    Please refer to the Lease Issuance Procedure section of Section III 
above for a discussion of the public comments related to this section 
and BOEM's responses to those comments.
    Sec.  585.225 What happens if BOEM accepts a bid?
    Section 585.225 sets forth the steps BOEM and the provisional 
winner will take after the auction. This section functions similarly to 
the existing regulations at Sec.  585.224(a), (b), (c), and (e), but 
contains several new provisions. First, this section provides that BOEM 
will refund, without interest, any portion of the provisional winner's 
bid deposit that exceeds the amount due from the winning bid. Second, 
this section permits BOEM to extend the 10-business-day deadline for 
the completion of the provisional winner's obligations to allow greater 
flexibility in addressing unforeseen situations, such as a Federal 
government shutdown or pandemic. This section will require payment of 
the first 12 months' rent within 45-calendar days after the provisional 
winner receives the executed lease from BOEM as opposed to 45 calendar 
days after receiving the three unexecuted lease copies as provided 
under the existing regulations. Finally, under this section, the 
provisional winner will become the winning bidder when BOEM executes 
the lease after any properly filed appeals under revised Sec.  
585.118(c) have been resolved. The effective date of the lease would 
continue to be governed by Sec.  585.237. In addition to the edits 
proposed in the NPRM, we have eliminated references to sending three 
copies of the lease document, facilitating electronic transmission of 
documents.
    Please refer to the Lease Issuance Procedure section of Section III 
above for a discussion of the public comments related to this section 
and BOEM's responses to those comments, as well as the revisions made 
to the proposed rule language in this final rule.
    Sec.  585.226 What happens if the provisional winner fails to meet 
its obligations?
    Existing Sec.  585.224(d) provides that a winning bidder will 
forfeit its bid deposit if it fails to execute and return the lease 
within 10 business days or otherwise fails to comply with applicable 
regulations or terms of the FSN. While no winning bidder has failed to 
meet its post-auction obligations thus far, BOEM recognizes the 
potential for such a situation and seeks to provide flexibility in its 
response to such a possibility.
    In the final rule, Sec.  585.226 specifies that, if BOEM determines 
that a provisional winner has failed to meet its obligations under 
Sec.  585.225(b) or Sec.  585.316, or has otherwise failed to comply 
with applicable laws, regulations, or FSN provisions, BOEM may require 
forfeiture of the bid deposit. In the event the bid deposit exceeds the 
winning bid, BOEM would limit the required forfeiture amount to the 
lesser amount, that of the winning bid.
    Section 585.226 also sets forth the additional actions BOEM could 
take if a provisional winner fails to meet its obligations. These 
possible actions would include refusal to award other leases won by the 
provisional winner in the auction and referral to the Department's 
Administrative Remedies Division for suspension or debarment review 
pursuant to 2 CFR part 180 as implemented at 2 CFR part 1400. This 
section also specifies that, if the provisional winner fails to meet 
its obligations or is otherwise unable to execute a lease, BOEM could 
select a new provisional winner by either repeating the auction, 
selecting the next highest bid, or using other criteria specified in 
the FSN. No comments were received on this section.
    Sec. Sec.  585.227-585.229 [Reserved]
Noncompetitive Lease Award Process
    Sec.  585.230 May I request a lease if there is no Call?
    No changes were proposed for this section. This final rule adds no 
additional changes. BOEM received no comments on this section.
    Sec.  585.231 Will BOEM issue leases noncompetitively?
    In the NPRM, BOEM had proposed several modifications, both 
significant

[[Page 42690]]

and minor, to its noncompetitive leasing process. First, this final 
rule clarifies in paragraph (a) that BOEM will only use the 
noncompetitive process if it ``determines after public notice of a 
proposed lease, easement, or right-of-way that there is no competitive 
interest.'' \23\
---------------------------------------------------------------------------

    \23\ 43 U.S.C. 1337(p)(3).
---------------------------------------------------------------------------

    Second, in the event that a company submits a request for BOEM to 
issue a lease and submits the required acquisition fee, BOEM may issue 
a request for information in the Federal Register to determine whether 
any other companies also have an interest in that area. In the event 
that BOEM issues such a request for information and no responses are 
received, BOEM may issue a lease noncompetitively. This final rule 
revises paragraph (b) to clarify that BOEM has discretion to determine 
whether an unsolicited lease request should be the subject of a request 
for information. BOEM occasionally receives unsolicited requests for 
areas that it may deem inappropriate for leasing without seeking public 
input (e.g., previously leased areas or areas that straddle a USCG 
traffic separation scheme). In the event that BOEM elects not to issue 
a request for information in response to the unsolicited lease request, 
BOEM would not issue a lease noncompetitively and would instead refund 
the acquisition fee.
    Third, this final rule adds a timeline and sunset provision to 
BOEM's noncompetitive leasing processes. The existing regulations 
established neither an expiration date for a DNCI nor deadlines for the 
noncompetitive leasing process. If BOEM had left the regulations in the 
existing form, this could have allowed a company to obtain a 
noncompetitive lease in situations where there may potentially be other 
interested lessees in the future (due to changes in circumstances). 
Accordingly, the newly adopted paragraphs (d) and (e) create the 
following milestones for the noncompetitive leasing process:
     After publication of the DNCI, BOEM would prepare and 
provide the beneficiary with a written estimate of the fees to pay for 
the processing costs under Sec.  585.112, including conducting an 
environmental review prior to lease issuance.
     The beneficiary has 90 calendar days from receipt of the 
fee estimate to pay the fee.
     The DNCI would expire within two years of publication, 
unless BOEM determines, on a case-by-case basis, that this timeframe 
should be extended.
    Fourth, this final rule clarifies in paragraph (d)(3) that BOEM 
will conduct an environmental review of a noncompetitive lease request 
that it determined had no competitive interest but which BOEM intends 
to process. Fifth, this final rule specifies that BOEM will make a 
final decision as to whether to issue a noncompetitive lease after the 
completion of its environmental review and other reviews required by 
Federal law (e.g., CZMA). Section 585.231, paragraph (f), clarifies 
that for noncompetitive leases, CZMA concurrences would be processed 
pursuant to 15 CFR part 930, subpart D. Based on its experience, BOEM 
expects this to be a rare occurrence. BOEM clarified that the 
applicant's submissions to the State CZM agency be done ``in a timely 
manner'' so as not to delay the progress of the BOEM application for a 
noncompetitive lease and added conforming edits to the analogous 
section for ROWs and RUEs in Sec.  585.306(b).
    Finally, this final rule makes several miscellaneous technical 
corrections and clarifications to this section. It revises the existing 
section heading to reflect the scope of this section more accurately. 
The ``RFI'' referenced in Sec.  585.231(b) is being replaced with ``an 
RFI under Sec.  585.116, meaning a ``request for information in lieu of 
a ``request for interest''. This final rule would make administrative 
changes to Sec.  585.231(c)(1) and (h)(1)(ii) to reflect updated cross-
references in this final rule. This final rule also revises the payment 
due date for the first 12 months' rent on a lease consistent with 
changes to Sec. Sec.  585.225 and 585.503. The remainder of the 
noncompetitive lease issuance process remains substantially the same as 
in the prior regulations.
    In addition to finalizing the proposed changes, the final rule also 
makes some technical edits to this section. Due to the widespread 
adoption of electronic copies, in Sec.  585.225(b), BOEM removed 
references to BOEM sending three unsigned copies of the lease form to 
the provisional winner and removed the provisional winner's obligation 
to execute three copies. BOEM no longer needs to sign three copies, and 
BOEM will send the new lessee an electronic version of the executed 
lease. Corresponding changes were made in Sec.  585.231(h) for 
noncompetitive leases.
    Please refer to the Lease Issuance Procedure and Other Proposed 
Changes in Part 585 sections of Section III above for a discussion of 
the public comments related to this section and BOEM's responses to 
those comments, as well as the revisions made to the proposed rule 
language in this final rule.
    Sec.  585.232 May I acquire a lease noncompetitively after 
responding to a request for information or a Call for Information and 
Nominations?
    This final rule revises the section heading of Sec.  585.232 to 
reflect the change in nomenclature in proposed Sec.  585.116 from 
``request for interest'' to ``request for information.'' It also 
revises paragraph (c) to incorporate changes to the cross-referenced 
provisions associated with this final rule.
    No Comments were received on this section.
    Sec. Sec.  585.233-585.234 [Reserved]
Commercial and Limited Lease Periods
    Sec.  585.235 What are the lease periods for a commercial lease?
    Consistent with the proposed rule, BOEM is overhauling the 
organization and duration of its commercial leases as well as the 
triggers that move a lease from one period of a lease to another. These 
changes are responsive to industry comments, reflect BOEM's experience 
administering its leasing and plan review programs, and arise from 
other aspects of this rulemaking--particularly the elimination of the 
SAP for met buoys.
    Under the existing regulations, BOEM's commercial leases comprised 
three ``terms'':
     A preliminary term of 12 months, starting at lease 
execution and typically ending with the submission of an SAP.
     A site assessment term of 5 years, starting at SAP 
approval and ending with the submission of a COP.
     An operations term of 25 years, typically starting at COP 
approval.
    Up to now, BOEM has automatically tolled the preliminary and site 
assessment terms during its review of submitted plans; a lessee could 
request additional time extensions if it did not timely file a plan.
    This final rule makes numerous changes to the text and structure of 
Sec.  585.235(a). First, as proposed, BOEM renames its lease ``terms'' 
as lease ``periods'' to describe the progression of its commercial 
leases more appropriately. This change in nomenclature is intended to 
more accurately distinguish between stages of lease development that 
under the existing regulations were covered by the same term. For 
example, construction and operations represent very different stages of 
development, deserving of separate treatment under the regulations.
    Next, as proposed, BOEM merged the preliminary and site assessment 
terms into one 5-year preliminary period that commences on the lease 
effective date and ends either with the submittal of a COP to BOEM for 
its review or five years after the lease effective date,

[[Page 42691]]

whichever occurs first. This change flows directly from BOEM's proposal 
to eliminate the SAP requirement for met buoys.\24\ Given that most 
lessees are not expected to submit an SAP under the final rule, BOEM 
believes it no longer makes sense for a lease to contain a deadline for 
SAP submittal--much less to use that deadline to trigger a new phase of 
the lease. (As discussed in the section-by-section analysis of Sec.  
585.601 in section below, BOEM also has removed all deadlines for SAP 
submittals.)
---------------------------------------------------------------------------

    \24\ See supra section V.A, entitled ``Site Assessment 
Facilities,'' for complete discussion.
---------------------------------------------------------------------------

    Consistent with the proposed rule, this final rule creates two 
additional lease periods between the submission of the COP and the 
operations period: the COP review period and the design and 
construction period. As proposed, the COP review period starts at COP 
submittal and ends upon BOEM's decision on whether to approve or 
disapprove the COP or approve the COP with conditions pursuant to Sec.  
585.628. As proposed, BOEM did not establish a fixed length for the COP 
review period in the final rule to preserve regulatory flexibility and 
to allow for harmonization with recent government-wide permit review 
streamlining initiatives (e.g., FAST-41).\25\
---------------------------------------------------------------------------

    \25\ Fixing America's Surface Transportation Act Title 41, 42 
U.S.C. 4370m et seq.
---------------------------------------------------------------------------

    However, in the final rule, BOEM did not adopt the proposed one-
year time limit for a lessee after its initial COP submission to 
resolve issues identified by BOEM and to finalize its COP. BOEM 
recently published guidance that addresses these issues in a more 
nuanced manner than the one-year proposal described in the NPRM.\26\
---------------------------------------------------------------------------

    \26\ Information Needed for Issuance of a Notice of Intent (NOI) 
Under the National Environmental Policy Act (NEPA) for a 
Construction and Operations Plan. (Aug. 2023) available at https://www.boem.gov/sites/default/files/documents/renewable-energy/state-activities/BOEM%20NOI%20Checklist.pdf).
---------------------------------------------------------------------------

    In the final rule, the design and construction period starts at COP 
approval and ends when the operations period begins. In the final rule, 
BOEM changed the ending of the design and construction period from the 
proposed ending of ``either when commercial operations begin or at the 
expiration of the period set forth in the approved COP as modified'' to 
the more precise ``when the operations period begins.'' Likewise, BOEM 
declined to implement a provision in the proposed rule that would have 
required COPs to include a proposed timeline for the design and 
construction period, subject to approval by BOEM as part of the COP 
review. These revisions improved the clarity and consistency of the 
transition between the design and construction period to the operations 
period and supported BOEM's changes to the operations period at Sec.  
585.235(a)(4) which disconnected the beginning of the operations period 
from the commencement of commercial operations of any facility. 
Instead, the operations period commences when the requirements of 30 
CFR 285.637 are met for an entire project area through the submission 
of final reports and records. Many of the aforementioned changes were 
made in response to comments, as discussed further in Other Proposed 
Changes in Part 585, section III above.
    BOEM originally proposed that the operations period commence at the 
commercial operations start date and remain in effect for 30 years. In 
the final rule, BOEM implemented a default 35-year operations period 
based on the expected utility of project facilities and comments 
received on the NPRM. BOEM's previous regulations established a default 
construction and operations term of 25 years, though because this 
period includes the time needed to construct the project, the actual 
duration of operations would be as much as several years less than 
that. Commenters have indicated that this is less than the projected 
life of the facilities being installed, and technical advancements will 
likely push the design life of offshore wind facilities even further.
    BOEM is making two other changes to the proposed operations period. 
First, BOEM added language to allow a lessee to propose an extension to 
the operations period for their project within their COP. This change 
is more efficient than the NPRM proposal because it allows BOEM to 
approve an alternate operations period, as an element of COP approval, 
that is specifically tailored to the purpose and need for the project, 
as well as the projected life of the project facilities. Second, BOEM 
replaced the trigger for the commencement of the operations period. The 
NPRM proposed the operations period would commence at the start of 
commercial operations. The final rule replaces this trigger with ``when 
the requirements of Sec.  285.637(a) are met through the submission of 
final reports and records for your project.'' The final rule ties the 
commencement of the operations period more closely to the completion of 
construction and installation than the NPRM did. This change also 
reflects the revised definition of commercial operations included in 
the final rule, which would result in commercial operations beginning 
in many cases during testing and first power. Larger projects may be 
constructed, tested and powered over several seasons and even years, 
therefore, BOEM finds it more appropriate to set the operations period 
to begin when construction and installation is substantially complete. 
Some of the aforementioned changes were made in response to comments, 
as discussed further in Other Proposed Changes section in part 585 of 
section III above.
    The Department recognizes that existing lessees may seek 
modification of their leases to conform to the new lease periods, among 
other changes. BOEM intends to contact existing lessees with a proposal 
for amending leases to take advantage of certain revisions made in this 
final rule.
    In addition to revamping the structure of its commercial leases, 
the Department proposed several provisions aimed at granting a lessee 
more flexibility throughout the development process. First, the 
Department proposed expanding the criteria in Sec.  585.235(b) for 
granting extensions of lease periods. Previously, the only enumerated 
basis for extending the preliminary term or the site assessment term 
was if a lessee submitted a plan late. The Department proposed to 
clarify that it has discretion to extend any lease period for good 
cause. In the final rule, BOEM includes the ``good cause'' rationale as 
well as the additional descriptor ``including if the project is 
designed and verified for a longer duration'' as an illustration of 
``good cause.''
    Second, the Department proposed a new Sec.  585.235(c) clarifying 
that a lessee may propose an alternative lease period schedule if it 
chooses to develop its lease in phases. Numerous lessees have expressed 
interest in phased development of their leases, but the previously 
existing regulations did not explicitly set forth a process for 
modifying the default lease schedule if a lessee intends to defer 
development on portions of its lease area. Third and relatedly, the 
Department proposed a new Sec.  585.235(d) providing that a lessee may 
seek modification of the default lease schedule in its application to 
segregate its lease or consolidate two adjacent leases. With this final 
rule, all of the aforementioned proposed changes have been implemented, 
with one additional change made in the final rule.
    In the final rule BOEM changed ``you may propose lease period 
schedules for each phase in your COP'' to ``you must propose lease 
period schedules for each phase in your COP'' due to the potential need 
for a separate lease period schedule for latter phase(s). Notably,

[[Page 42692]]

BOEM anticipates that this would typically include a different 
operations period for latter phase(s)--one that would begin well after 
project construction was substantially complete for the first phase. 
Consequently, for a phased development COP, each phase will have its 
own lease period schedule upon COP approval that was informed by the 
lessee's request, BOEM's review of the request, and the resulting BOEM-
approved schedule. This process for establishing the lease period 
schedule for phased development COPs avoids unintentional barriers to 
phased development that could result if a lessee did not provide lease 
period schedule information for each phase of the project. Every year 
of an operations period, in particular, holds significant commercial 
value and BOEM's intent is to ensure due diligence on leases, while 
balancing the need to support key development flexibilities enshrined 
in BOEM's regulations, most notably phased development. Such a balance 
is achieved here because the lessee is demonstrating due diligence on 
the first phase of its lease while continuing to mature latter phases. 
Finally, this change supports providing certainty to a lessee regarding 
the operations period of its renewable energy project.
    As discussed in the section-by-section analyses of Sec. Sec.  
585.410 and 585.413 below, BOEM previously approved lease segregation 
and consolidation requests and anticipates more such requests in the 
future. However, unlike these new regulations, the previous regulations 
did not explicitly address the effects these actions might have on 
lease schedules.
    Please refer to the Other Proposed Changes in Part 585 section of 
section III above for additional discussion of the public comments 
related to this section and BOEM's responses to those comments, as well 
as the revisions made to the proposed rule language in this final rule.
    Sec.  585.236 If I have a limited lease, how long will my lease 
remain in effect?
    With this final rule, BOEM substituted the word ``period'' for 
``term'', as proposed, to ensure consistency with its changes to Sec.  
585.235. Additionally, because limited leases may allow a wide range of 
activities, this final rule would replace the existing five-year 
operations term with an operations period of a duration to be 
determined by BOEM prior to auction (if the lease is issued 
competitively) or negotiated with the applicant (if the lease is issued 
noncompetitively). In either case, the length of the term will depend 
on the intended use of the lease. The existing regulations specified 
that extensions of the preliminary term may be requested if the GAP for 
the limited lease was not going to be submitted in a timely manner. 
With this final rule, BOEM will allow extensions of a limited lease's 
preliminary period only if the requested extension can be justified for 
``good cause.'' Consistent with the changes to Sec.  585.235, BOEM will 
also allow extensions of a limited lease's operations period if the 
requested extension can be justified for ``good cause.''
    No comments were received on this section.
    Sec.  585.237 What is the effective date of a lease?
    No changes were proposed for this section. This final rule adds no 
additional changes. BOEM received no comments on this section.
    Sec.  585.238 May I develop my commercial lease in phases?
    As a result of the Reorganization Rule (88 FR 6376), this section 
was removed from Sec.  585.629 as specified in 76 FR 64763, and added 
as Sec.  585.238 in the final rule. In the final rule BOEM added ``You 
must also propose a lease period schedule for each phase in your COP in 
accordance with Sec.  585.235(c)'' in support of the referenced text in 
Sec.  585.235 and to ensure clarity. In addition, BOEM added, ``BOEM 
may condition its approval of subsequent phases described in a phased 
development COP'' to facilitate phased development. BOEM added this 
sentence in response to a recommendation of a commenter. This change, 
like the changes to the lease periods included in the NPRM and final 
rule, removes barriers to phased development of leases and supports a 
more fulsome implementation of those changes.
    Sec.  585.239 Are there any other renewable energy research 
activities that will be allowed on the OCS
    No changes were proposed for this section. This final rule adds no 
additional changes. BOEM received no comments on this section.
    Sec. Sec.  585.240-585.299 [Reserved]

E. 30 CFR Part 585, Subpart D--Right-of-Way Grants and Right-of-Use and 
Easement Grants for Renewable Energy Activities

    Subpart C, Right-of-Way Grants and Right-of-Use and Easement Grants 
for Renewable Energy Activities, has been redesignated as subpart D to 
accommodate the addition of a new subpart B, as noted in Renewable 
Energy Leasing Schedule section of Section III above.
Row Grants and RUE Grants
    In response to the comment recommending defining roles among BOEM, 
DOE, FERC, and RTO/ISO, BOEM agrees that coordination among these 
entities is critical to the transmission planning process and will 
continue to take steps to further refine roles and responsibilities as 
the industry continues to develop. Additionally, BOEM and FERC signed a 
Memorandum of Understanding (MOU) on April 9, 2009. The purpose of this 
MOU was to clarify jurisdictional understanding regarding renewable 
energy projects in offshore waters on the OCS, in order to develop a 
cohesive, streamlined process that would help accelerate the 
development of wind, solar, and hydrokinetic (i.e., wave, tidal, and 
ocean current) energy projects. Additional updates to the rulemaking 
with respect to the ROW and RUE provisions were made in response to 
comments, as described further in Section III above.
    Sec.  585.300 What types of activities are authorized by ROW grants 
and RUE grants issued under this part?
    The only change that this final rule makes to this section is 
replace the word ``an'' with ``a'' in three places. BOEM received no 
comments on these proposed changes and makes no changes to them in the 
final rule.
    Sec.  585.301 What do ROW grants and RUE grants include?
    BOEM has removed, as proposed, the previously prescribed width of 
ROWs, in order to implement the PDE approach discussed above in Project 
Design Envelope and Geophysical and Geotechnical Surveys sections of 
Section III, and to maintain consistency with BOEM's proposed revisions 
to Sec.  585.628(g) for project easements. BOEM is also clarifying that 
a subsea cable ROW may need to accommodate multiple associated 
facilities. BOEM received no substantive comments on this section.
    Sec.  585.302 What are the general requirements for ROW grant and 
RUE grant holders?
    BOEM has implemented a technical correction to update the cross 
references in this section, reflecting that an applicant must meet the 
qualifications set forth in Sec. Sec.  585.107 and 585.108 in order to 
acquire a ROW or RUE. BOEM received no comments on this section.
    Sec.  585.303 How long will my ROW grant or RUE grant remain in 
effect?
    BOEM has substituted the word ``period'' for ``term'' to ensure 
consistency with the changes to Sec.  585.235. By renaming the 
preliminary term of a ROW and RUE as the

[[Page 42693]]

preliminary period, BOEM intends to more accurately distinguish between 
the entire term of a ROW and RUE and its constituent parts. As with 
Sec.  585.235, BOEM also anticipates that this revision will clarify 
whether and when a grantee has control of its ROW or RUE. BOEM is 
providing the same flexibility for the operations period of its grants 
as it has with the operations period for its limited leases in proposed 
Sec.  585.236(a)(2), both in terms of start date and duration. Finally, 
BOEM will allow extensions of either grant period, consistent with its 
changes to Sec.  585.235. The existing regulations specified that the 
GAP must be submitted no later than the end of the preliminary period 
in order for the grant to remain in effect. With this rulemaking, BOEM 
has implemented a change whereby the preliminary period may be extended 
if the requested extension can be justified for ``good cause.''
    BOEM's existing regulations specified that the ROW grant or RUE 
grant would remain in effect for as long as it is being used for the 
purpose for which it was granted. This rule has modified that provision 
by introducing an operations period as set by BOEM (if the grant is 
issued competitively) or negotiated with the applicant (if the grant is 
issued noncompetitively). The duration of the operations period will 
depend on the intended use of the grant. BOEM will allow extensions of 
a ROW grant or RUE grant operations period if the requested extension 
can be justified for ``good cause,'' as determined by BOEM.
    Sec.  585.304 [Reserved]
Obtaining Row Grants and RUE Grants
    Sec.  585.305 How do I request a ROW grant or a RUE grant?
    A technical edit has been made to this section as a result of the 
Reorganization Rule (88 FR 6376). BOEM has eliminated the paper copy 
requirement, consistent with the revised provisions in Sec.  585.111. 
BOEM received no comments on this section.
    Sec.  585.306 What action will BOEM take on my request?
    As a result of the Reorganization Rule (88 FR 6376), Sec.  585.306 
adds two provisions to paragraph (b) from the existing Sec.  585.309 
and removes the existing Sec.  585.309. This consolidation simplifies 
and clarifies this subpart. Minor additional edits were made to this 
section to ensure consistency with the addition of ``in a timely 
manner'' to Sec.  585.231(f). Please refer to the Lease Issuance 
Procedures section of Section III above for additional discussion of 
the public comments related to this section and BOEM's responses to 
those comments, as well as the revisions made to the proposed rule 
language in this final rule.
    Sec.  585.307 How will BOEM determine whether competitive interest 
exists for ROW grants and RUE grants?
    BOEM added, as proposed, the word ``generally'' to Sec.  585.307(a) 
to clarify that BOEM does not need to specifically describe the 
parameters of a future project and that a public notice need only 
include enough information about the future project to allow potential 
ROW and/or RUE grant holders to assess whether they would be interested 
in competitively participating in an auction for the grant.
    BOEM added a new paragraph (c) to the final rule to help align 
Federal and State transmission processes, as in the case of 
transmission ROWs, the State inherently must also issue a grant to 
extend through State waters, and on land. This clarifies BOEM's 
authority to take into consideration the competitive determination of a 
State, regional transmission organization, or independent system 
operator to satisfy the competition requirement of 43 U.S.C. 1337(p)(3) 
in determining whether competitive interest exists for proposed 
transmission. BOEM may issue a public notice to determine whether 
competitive interest exists prior to the conclusion of a State or ISO/
RTO process that generally describes the potential ROW/RUE, BOEM's 
coordination with the State or ISO/RTO process that requested use of 
the OCS for a project supporting transmission from renewable energy, 
and explaining that BOEM will make the determination of whether 
competitive interest exists after assessing comments on the proposal 
and area, but after the State or ISO/RTO has made decision on the 
procurement of a project(s). This will allow BOEM to continue 
coordination with the relevant intergovernmental partners necessary for 
the consideration and permitting of such a project. This coordination 
will help reduce the likelihood of a scenario where a State awards use 
of State waters to one project proponent, and BOEM awards use of the 
OCS to a different project proponent through a competitive process, 
which would frustrate the goals of OCSLA of orderly and expeditious 
development of renewable resources, and the goals of environmental 
protection and the prevention of waste.
    Please refer to the Lease Issuance Procedures section of Section 
III above for additional discussion of the public comments related to 
this section and BOEM's responses to those comments, as well as the 
revisions made to the proposed rule language in this final rule.
    Sec.  585.308 How will BOEM conduct an auction for ROW grants and 
RUE grants?
    No changes were proposed for this section. This final rule adds no 
additional changes. BOEM received no comments on this section.
    Sec.  585.309 When will BOEM issue a noncompetitive ROW grant or 
RUE grant?
    The existing Sec.  585.309 was removed by this final rule as 
redundant (see analysis of Sec.  585.306).
    Sec.  585.309 What is the effective date of a ROW grant or a RUE 
grant?
    A technical edit has been made to this section as a result of the 
Reorganization Rule (88 FR 6376). This section was re-numbered in this 
final rule as Sec.  585.309 (from Sec.  585.310). The substance of this 
section is unchanged.
    Sec. Sec.  585.310-585.314 [Reserved]
Financial Requirements for Row Grants and Rue Grants
    Sec.  585.315 What deposits are required for a competitive ROW 
grant or RUE grant?
    No changes were proposed for this section. This final rule adds no 
additional changes. BOEM received no comments on this section.
    Sec.  585.316 What payments are required for ROW grants or RUE 
grants?
    A technical correction has been made to this section as a result of 
the Reorganization Rule (88 FR 6376). BOEM made a technical correction 
to reflect that Office of Natural Resources Revenue (ONRR) is the 
appropriate payee.
    Sec. Sec.  585.317-585.399 [Reserved]

F. 30 CFR part 585, subpart E--Lease and Grant Administration

    Subpart D, Lease and Grant Administration, has been redesignated as 
subpart E to accommodate the addition of a new subpart B, as proposed 
and as noted in Renewable Energy Leasing Schedule section of Section 
III.
Noncompliance and Cessation Orders
    Sec.  585.400 What happens if I fail to comply with this part?
    The previous Sec.  585.400 was moved to Sec.  585.106 by the 
Reorganization Rule. Please refer to the Other Proposed Changes in Part 
585 of Section III above for a discussion of the public comments 
related to this section and BOEM's responses to those comments, as well 
as the revisions made to the proposed rule language in this final rule.
    Sec. Sec.  585.400-585.404 [Reserved]
    Sections 585.401 and 585.402 have been deleted as unnecessary.

[[Page 42694]]

Designation of Operator
    Sec.  585.405 How do I designate an operator?
    BOEM updated citations in this section, as proposed, to maintain 
consistency with changes in the organization of Sec. Sec.  585.626 and 
585.645 and made a grammatical edit.
    Sec.  585.406 Who is responsible for fulfilling lease and grant 
obligations?
    Following publication of the Reorganization Rule, BOEM added a 
reference in this section to the regulations at 30 CFR part 285 to 
clarify that the lessee or grantee is also responsible for fulfilling 
obligations under the BSEE-administered regulations.
    Sec.  585.407 [Reserved]
Lease or Grant Assignment, Segregation, and Consolidation
    Sec.  585.408 May I assign my lease or grant interest?
    BOEM added ``to one or more parties'' to paragraph (a) of the final 
rule in response to comments requesting BOEM explicitly allow the 
lessee to assign all or part of the lease area to other entities. BOEM 
eliminated specific elements of the regulatory requirements for an 
assignment application in paragraph (b) that are duplicative with many 
of the requirements of Sec.  585.409, and that are also already 
provided for in the form that is currently on the BOEM website for 
leases (Form BOEM-0003) and grants (Form BOEM-0002). BOEM modified the 
date on which an assignment becomes effective to better align this 
requirement with BOEM's oil and gas regulations on the effective date 
of assignments, found in 30 CFR 556.712. This final rule also clarifies 
that paragraph (d) refers to mergers, name changes, or changes of 
business form and not to the lease consolidation provisions of Sec.  
585.413 and that the lessee must notify BOEM of these events under 
Sec.  585.110.
    Please refer to the Other Proposed Changes in Part 585 section of 
Section III above for additional discussion of the public comments 
related to this section and BOEM's responses to those comments, as well 
as the revisions made to the proposed rule language in this final rule.
    Sec.  585.409 How do I request approval of a lease or grant 
assignment?
    BOEM made technical changes to this section to update cross-
references in paragraphs (b) and (c) in the final rule.
    This final rule added a new Sec.  585.410, as proposed, to explain 
when an assignment would result in a segregated lease. BOEM added a 
paragraph (c) to the proposed Sec.  585.410 in response to comments. 
Existing Sec. Sec.  585.410 and 585.411 have been renumbered to 
Sec. Sec.  585.411 and 585.412, respectively.
    Sec.  585.410 When will my assignment result in a segregated lease?
    BOEM's existing regulations authorized approval of requests to 
segregate its leases into multiple smaller leases under Sec.  
585.408(a), allowing lessees to ``assign all or part of your lease or 
grant interest . . . subject to BOEM approval under this subpart.'' 
BOEM previously had approved lease segregations and continues to 
anticipate receiving more requests as some lessees may decide to 
develop their leases in a phased fashion. Accordingly, BOEM clarified 
the process for segregating leases by adopting language from the lease 
segregation provisions in its oil and gas regulations at 30 CFR 
556.702. BOEM added that an ``application to assign a lease or grant 
may include a request to modify the existing lease or grant period 
schedule consistent with Sec.  585.235(d)'' in response to comments and 
to ensure consistency with Sec.  585.235. BOEM has added a new 
paragraph (c) to explain that when a lease becomes segregated, BOEM may 
issue separate plan approval for a segregated lease or take other 
actions within its discretion.
    Please refer to the Other Proposed Changes in Part 585 section of 
Section III above for additional discussion of the public comments 
related to this section and BOEM's responses to those comments.
    Sec.  585.411 How does an assignment affect the assignor's 
liability?
    This section has been re-numbered, as proposed, to reflect addition 
of the Sec.  585.410 regarding lease segregation. No other changes were 
made.
    Sec.  585.412 How does an assignment affect the assignee's 
liability?
    This section is re-numbered, as proposed, to reflect the addition 
of Sec.  585.410 regarding lease segregation. Also, because of the 
Reorganization Rule, a new cross-reference to applicable BSEE 
regulations at 30 CFR part 285, subpart I, was added to paragraph (a) 
and a cross-reference to 30 CFR part 285 was added to paragraph (b). 
This final rule corrects the extent of an assignee's regulatory 
liability by replacing ``subchapter'' with ``part'' in the first 
sentence of paragraph (b).
    Sec.  585.413 How do I consolidate leases or grants?
    BOEM added procedures in this section for consolidating two or more 
adjacent leases or grants, as proposed. Under the existing regulations, 
BOEM had the authority to approve lease consolidations by mutual 
agreement under the terms of its existing leases (and has already done 
so once), but no regulatory provision directly addressed such requests. 
Section 585.413 codifies BOEM's existing practices in the regulations 
by establishing a procedure for requesting and approving consolidations 
of leases and grants.
    BOEM notes that adjacent leases or grants may have different terms 
and be at differing stages of development. BOEM has addressed such 
differences as explained below. If the time remaining in the relevant 
lease periods differs between the leases or grants to be consolidated, 
BOEM will default to the shorter remaining periods in the new lease or 
grant. Alternatively, the lessee or grantee may request a revised lease 
period schedule pursuant to Sec.  585.235(d). If other terms and 
conditions differ between the leases or grants to be consolidated, BOEM 
will default to the most recently issued terms and conditions contained 
in the leases or grants to be consolidated. The lessee or grantee may 
request modifications to such terms and conditions. BOEM will consider 
and, in its discretion, approve such requests on a case-by-case basis 
for good cause. BOEM may assess the need to modify existing financial 
assurances before approving a proposed consolidation. Any consolidated 
leases or grants that has been consolidated into the new lease or grant 
in their entirety will be considered terminated at the time of 
consolidation approval. Please refer to the Other Proposed Changes in 
Part 585 section of Section III above for additional discussion of the 
public comments related to this section and BOEM's responses to those 
comments.
    Sec.  585.414 [Reserved]
Lease or Grant Suspension
    Sec.  585.415 What is a lease or grant suspension?
    As proposed, BOEM has changed the word ``term'' to ``period'' in 
paragraphs (a) and (b) to correspond to the changes made to Sec.  
585.235. This change did not alter the substance of these paragraphs. A 
cross-reference to relevant BSEE regulations at 30 CFR 285.417 has also 
been added in paragraph (a)(2), due to the Reorganization Rule.
    Sec.  585.416 How do I request a lease or grant suspension?
    As proposed, BOEM made several technical corrections and 
clarifications to this section. First, BOEM reorganized the contents of 
a suspension application for clarity and added a catch-all category to 
provide BOEM with additional flexibility. Second, BOEM added a new 
paragraph (b) consistent with its revisions to Sec.  585.235(b). A few 
minor other changes have been made for editorial clarity.

[[Page 42695]]

    Sec.  585.417 When may BOEM order a suspension?
    Several provisions of this section were deleted because the 
relevant provisions were moved to BSEE-administered regulations as part 
of the Reorganization Rule. Therefore, the final rule retains only two 
circumstances when BOEM may order a suspension, when necessary to 
comply with judicial decrees or when the suspension is necessary for 
reasons of national security or defense. Please refer to the Section-
by-Section Analysis Sec.  285.417 in Section V, which includes the 
BSEE-administered regulations that were finalized consistent with the 
proposed rule.
    Sec.  585.418 How will BOEM issue a suspension?
    No change was proposed or made to this section.
    Sec.  585.419 What are my immediate responsibilities if I receive a 
suspension order?
    No change was proposed or made to this section.
    Sec.  585.420 What effect does a suspension order have on my 
payments?
    BOEM made some technical edits to this section by combining 
paragraphs (b) and (c) and modifying the requirement that directed 
suspensions always be accompanied by a fee suspension, as proposed. As 
a result, all payment suspensions will be at the discretion of BOEM. 
BOEM also clarifies that, regardless of whether a lease or grant 
suspension is approved or ordered, BOEM has discretion to ``waive or 
defer'' (rather than ``suspend'') payments while the lease or grant is 
suspended. BOEM believes that more flexibility is needed than its 
existing regulations provide regarding its treatment of such payments, 
given the wide range of potential justifications for a suspension. 
Corresponding changes and clarifications were made to part 285 to 
maintain consistency with these regulations and to provide the same 
flexibility when either BSEE or BOEM orders a suspension, which may 
occur as a result of the Reorganization Rule.
    Sec.  585.421 How long will a lease or grant suspension be in 
effect?
    No change was made to this section other than the addition of a 
clarifying edit that was made in the Reorganization Rule applying 
suspensions to either leases or grants, such as RUEs and ROWs.
    Sec.  585.422 When can my lease or grant be canceled?
    This section was moved from Sec.  585.437 to Sec.  585.422 by the 
Reorganization Rule. No other changes were proposed or made to this 
section.
    Sec. Sec.  585.423-585.424 [Reserved]
Lease or Grant Renewal
    Sec.  585.425 May I obtain a renewal of my lease or grant before it 
terminates?
    BOEM proposed and made a technical change in this section in the 
final rule to conform to its proposed changes to Sec.  585.235 by 
changing the word ``term'' to ``period'' wherever it appears.
    Sec.  585.426 When must I submit my request for renewal?
    BOEM proposed and made a technical change in this section in the 
final rule to conform to its proposed changes to Sec.  585.235 by 
changing the word ``term'' to ``period'' wherever it appears.
    Sec.  585.427 How long is a renewal?
    BOEM proposed and made technical changes in this section in the 
final rule to conform to its proposed changes to Sec.  585.235 by 
changing the word ``term'' to ``period'' wherever it appears.
    Sec.  585.428 What effect does applying for a renewal have on my 
activities and payments?
    No changes were proposed for this section. This final rule adds no 
additional changes. BOEM received no comments on this section.
    Sec.  585.429 What criteria will BOEM consider in deciding whether 
to renew a lease or grant?
    BOEM proposed adding a new paragraph (g) to this section providing 
for consideration of ``Other relevant factors, as appropriate'' in 
determining whether to renew a lease or grant. BOEM's discretion to 
consider relevant factors that may not be enumerated is particularly 
important, given the difficulty of foreseeing what issues may arise in 
the future when BOEM begins to receive lease renewal requests. BOEM 
finalized this section as proposed. BOEM received no comments on this 
section.
    Sec. Sec.  585.430-585.431 [Reserved]
Lease or Grant Termination
    Sec.  585.432 When Does My Lease or Grant Terminate?
    BOEM proposed and made technical changes in subpart (a) of this 
section in the final rule to conform to its proposed changes to Sec.  
585.235 by changing the word ``term'' to ``period'' wherever it 
appeared. BOEM also proposed and added ``in which case it terminates on 
the date set forth in the notice of suspension or renewal'' to subpart 
(a) of this section in the final rule. BOEM received no comments on 
this section.
    Sec.  585.433 What must I do after my lease or grant terminates?
    The Reorganization Rule modified paragraph (a)(2) to include a 
reference to the BSEE-administered regulations at 30 CFR 285.902. In 
the final rule BOEM made an additional edit to reference Sec. Sec.  
285.905 and 285.906 instead of Sec.  285.902 which more precisely 
address decommissioning applications. No comments were received on this 
section.
    Sec.  585.434 When may BOEM authorize facilities to remain in place 
following termination of a lease or grant?
    No changes were proposed for this section. This final rule adds no 
additional changes. BOEM received no comments on this section.
Lease or Grant Relinquishment, Contraction, or Cancellation
    As proposed, BOEM has consolidated the three undesignated sub 
headers in the existing regulations into one, for clarity and 
efficiency. The existing separate undesignated sub headers denoted 
lease or grant relinquishment, lease or grant contraction, and lease or 
grant cancellation.
    Sec.  585.435 How can I relinquish a lease or a grant or parts of a 
lease or grant?
    As proposed, the final rule makes a lease or grant relinquishment 
effective on the date BOEM receives a properly completed relinquishment 
form, subject to the obligations listed in the existing rule. This 
change would conform with BOEM's approach to oil and gas lease 
relinquishments in 30 CFR 556.1101, under which a relinquishment takes 
effect as soon as the lessee or grantee files with BOEM a properly 
completed official relinquishment form available on BOEM's website. 
Relinquishments will no longer require BOEM approval. As in the prior 
regulations, relinquishment of a lease or grant would have no impact on 
a lessee's or grant holder's obligations accrued under those 
instruments before the relinquishment. The Reorganization Rule also 
changed paragraph (a)(2) to reference ``to BSEE's satisfaction'' 
instead of BOEM due to the transfer of decommissioning regulations to 
BSEE effectuated by the Reorganization Rule. After BOEM receives the 
properly completed relinquishment form, ONRR will bill the lessee or 
grantee the amount due on any outstanding obligations that accrued 
under the relinquished lease or grant. No other changes were proposed 
or made in the final rule. No comments were received on this section.
    Sec.  585.436 Can BOEM require lease or grant contraction?
    No changes were proposed or made to this section. No comments were 
received on this section.
    Sec.  585.437 When can my lease or grant be canceled?
    This section was deleted and made reserved because the 
Reorganization Rule moved this section to Sec.  585.422.

[[Page 42696]]

    Sec.  585.438 What happens to leases or grants (or portions 
thereof) that have been relinquished, contracted, or cancelled?
    The existing regulations did not provide a process by which BOEM 
could reissue a lease or grant for an area (or portions thereof) 
previously covered by a lease or grant that has been relinquished under 
Sec.  585.435, contracted under Sec.  585.436, or cancelled under Sec.  
585.422. The final rule adds new Sec.  585.438, as proposed, to allow 
BOEM to restart the competitive leasing process at any point it deems 
reasonable after a lease or grant (or portion thereof) is relinquished, 
contracted, or cancelled. In such situations, under this final rule, 
BOEM would be obligated to engage in additional environmental analysis 
and consultation, if necessary, due to elapsed time or changed 
conditions. This final rule also allows, as proposed, BOEM to reoffer 
the lease or grant to the next highest bidder if a competitively issued 
lease or grant (or portion thereof) is relinquished or cancelled within 
six months of the auction. BOEM believes that within six months, the 
next best bid may still be deemed sufficient to constitute fair return 
under 43 U.S.C. 1337(p)(2)(A). Minor grammatical edits were made to 
ordering of cross references in paragraphs (a) and (b) in the final 
rule. Please refer to the Lease Issuance Procedures section of Section 
III above for additional discussion of the public comments related to 
this section and BOEM's responses to those comments.
    Sec. Sec.  585.439-585.499 [Reserved]

G. 30 CFR Part 585, Subpart F--Payments and Financial Assurance 
Requirements

    Subpart E, Payments and Financial Assurance Requirements, has been 
redesignated as subpart F to accommodate the addition of a new subpart 
B, as noted in Renewable Energy Leasing Schedule section of Section III 
above.
Payments
    Sec.  585.500 How do I make payments under this part?
    This final rule adopts the changes to this section proposed in the 
NPRM. First, it replaces the due date in paragraph (c)(1) for the bonus 
balance payment on a competitively issued lease from ``[l]ease 
issuance'' to ``[w]ithin 10 business days of receiving the unsigned 
lease'' and adds a section reference. This final rule also replaces the 
word ``issuance'' with ``execution'' in the ``Due date'' column of 
paragraphs (c)(3) and (7). Also, in paragraph (c)(3), this final rule 
changes the due date for payment of initial rent for a lease from ``45 
days after lease issuance'' to ``within 45 calendar days after 
receiving your copy of the executed lease from BOEM.'' These changes 
are intended to provide clarity and to give a lessee or a grantee more 
time to make the required payments.
    This final rule also substitutes the word ``period'' for ``term'' 
in paragraphs (a) and (c) to ensure consistency with the changes to 
Sec.  585.235. This final rule replaces the annual ROW rent of $70 per 
mile with an annual rent of $5 per acre as determined by Sec.  
585.301(a). This change provides BOEM with consistency in pricing OCS 
usage for RUEs and ROWs. See further discussion on rent payment below 
in the section-by-section analysis of Sec.  585.508.
    BOEM did not receive any substantive comments on this section.
    Sec.  585.501 What deposits must I submit for a competitively 
issued lease, ROW grant, or RUE grant?
    Existing Sec.  585.501 describes the deposit a bidder had to submit 
to participate in specific types of auctions for a lease, RUE, or ROW. 
As proposed, the final rule revises Sec.  585.501 to eliminate 
provisions specifying deposits by auction type and instead provides 
BOEM with the discretion to establish bid deposit requirements in the 
FSN. This change is consistent with the provisions of Sec.  585.222(a).
    No comments were received on this section.
    Sec.  585.502 What initial payment requirements must I meet to 
obtain a noncompetitive lease, ROW grant, or RUE grant?
    No changes were proposed for this section. This final rule adds no 
additional changes. BOEM received no comments on this section.
    Sec.  585.503 What are the rent and operating fee requirements for 
a commercial lease?
    As proposed, Sec.  585.503(a) revises the payment due date for the 
first 12 months' rent on a commercial lease. The winning bidder is 
required to pay the rent no later than 45 calendar days after receiving 
a copy of the executed lease from BOEM in accordance with the 
requirements provided in Sec.  585.500(c)(3). The existing regulations 
provided that the rent payment is due no later than 45 calendar days 
after BOEM sends the unsigned copies of the lease to the provisional 
winner. This new section effectively would give lessees slightly more 
time to pay the first 12 months' rent.
    BOEM also made several technical corrections to this section to 
conform to the definition of ``commercial operations'' in Sec.  585.113 
and the establishment of the ``operations period'' under Sec.  
585.235(4), as well as to provide more specificity regarding the 
regulations that govern payments to ONRR.
    No comments were received on this section.
    Sec.  585.504 How are my payments affected if I develop my lease in 
phases?
    BOEM made a technical change, as proposed, to provide a more 
specific citation to the regulations that govern payments to ONRR. In 
addition, a technical change was made to citation Sec.  585.238 as a 
result of the Reorganization Rule (88 FR 6376).
    Sec.  585.505 What are the rent and operating fee requirements for 
a limited lease?
    BOEM finalized the technical changes proposed in the NPRM to 
provide a more specific citation to the regulations that govern 
payments to ONRR.
    Sec.  585.506 What operating fees must I pay on a commercial lease?
    BOEM finalized the changes proposed in the NPRM for this section. 
BOEM amended the introductory paragraph to clarify that operating fees 
are triggered at the start of commercial operations as defined in Sec.  
585.113. Consistent with the existing regulations, generation of 
electricity for commercial use, sale, transmission, or distribution 
during testing is subject to operating fees. BOEM also amended 
paragraph (c)(1) to remove ``generation of electricity'' and replace it 
with ``operations'' consistent with the use of ``commercial 
operations'' throughout the regulations. BOEM also amended paragraph 
(c)(3)(i) to reflect the clear distinction between ``commercial 
operations'' and the ``operations period'' under the final rule. After 
the first year of the ``operations period'' is the appropriate point to 
assess the capacity factor as opposed to the commencement of 
``commercial operations'' which may occur during testing when limited 
numbers of WTGs are producing power.
    In addition to finalizing the proposed changes, BOEM also made 
technical changes in the final rule to provide a more specific citation 
to the regulations that govern payments to ONRR; to identify ONRR as 
the correct payee for operating fees; and to define ``DOE.'' Finally, 
BOEM eliminated paragraph (c)(4) to reduce the administrative 
obligation of submitting duplicative gross annual generation figures. 
As a result, paragraph (c)(5) has been redesignated as paragraph 
(c)(4).
    Please refer to the Lease Issuance Procedure and General Comments 
and Response sections of Section III above for additional discussion of 
the public

[[Page 42697]]

comments related to this section and BOEM's responses to those 
comments.
    Sec.  585.507 What rent payments must I pay on a project easement?
    As proposed, BOEM made technical changes to provide a more specific 
citation to the regulations that govern payments to ONRR and to conform 
to the changes to Sec.  585.628(g).
    In addition to finalizing the proposed changes, the final rule also 
removed the word ``aerial'' before ``extent'' and replaced it with 
``areal''. ``Areal extent'' is the term used in geography to describe 
the size of a project easement area for an accessory platform. In 
paragraph (b)(1), BOEM removed ``when the operations term begins'' such 
that it refers only to Sec.  585.500, which provides that rent on a 
project easement is due upon COP or GAP approval.
    No comments were received on this section.
    Sec.  585.508 What rent payments must I pay on ROW grants or RUE 
grants associated with renewable energy projects?
    BOEM finalized technical changes proposed in the NPRM to provide a 
more specific citation to the regulations that govern payments to ONRR; 
to remove the word ``nautical'' as redundant given the definition of 
``miles'' in Sec.  585.113; and to make minor editorial adjustments 
that enhance readability. BOEM simplified ROW rental payments to 
reflect that, under this final rule, ROW corridors would have 
sufficient width to accommodate all planned grant activities. BOEM 
believes that most grantees would prefer an initially wider corridor 
that would encompass all areas of actual seabed disturbance, rather 
than the existing regulations, which limit corridors to a 200-foot 
width with a subsequent determination of the ``affected area'' outside 
that corridor. Grantees will be able to relinquish unused portions of 
the right-of-way corridor after construction, as set forth in Sec.  
585.301, and subsequently would be relieved of their obligation to pay 
rent for the acreage within relinquished areas.
    To promote consistency in BOEM's valuation of OCS rental pricing 
across RUEs and ROWs, this final rule also replaces the annual ROW rent 
of $70 per statute mile with a rent of the greater of $5 per acre per 
year or $450 per year, as determined by Sec.  585.301(a), unless 
otherwise specified in the grant. This change streamlines BOEM's 
existing rental fee calculations and ensures a consistent valuation of 
all OCS acreage for grants. Under the previous regulations, a ROW 
grantee was required to pay an annual rent of about $2.89 per acre and 
a RUE grant holder, $5 per acre.\27\ BOEM has since determined that no 
compelling reason supports this differential between the RUE and ROW 
annual rental rates. No substantive comments were received on this 
section.
---------------------------------------------------------------------------

    \27\ An annual ROW rent of $2.89 per acre for a one-mile, 200-
foot-wide corridor is derived as follows: A 1-mile, 200-foot-wide 
corridor has an area equivalent to 1,056,000 square feet or 24.24 
acres (43,560 square feet per acre); $70 divided by 24.24 acres is 
$2.89 per acre.
---------------------------------------------------------------------------

    Sec.  585.509 Who is responsible for submitting lease or grant 
payments to ONRR?
    As proposed, this final rule makes a technical correction to the 
section heading by replacing ``BOEM'' with ``ONRR'' as the correct 
payee.
    Sec.  585.510 May BOEM defer, reduce, or waive my lease or grant 
payments?
    BOEM finalized the proposed regulations in the NPRM to allow BOEM 
to grant requests for deferral of rental and operating fee payments, in 
addition to reductions or waivers. BOEM seeks to avoid confusion by 
explicitly including this authority in this final rule. BOEM also made 
a technical change to conform the language to BOEM's changes to Sec.  
585.235 (changed reference from ``term'' to ``period'').
    Sec. Sec.  585.511-585.514 [Reserved]
    Sec.  585.515 What financial assurance must I provide when I obtain 
my commercial lease?
    This section has been removed and reserved in this final rule, as 
explained in the analysis of Sec.  585.516.
Financial Assurance Requirements for Commercial Leases
    Sec.  585.516 What are the financial assurance requirements for 
each stage of my commercial lease?
    The following text, along with the comment descriptions in Risk 
Management and Financial Assurance section of Section III, summarize 
the changes that were proposed in the NPRM and that are implemented 
with this final rule. This final rule amended several key aspects of 
this section.
    As discussed in Risk Management and Financial Assurance section of 
Section III, BOEM has replaced the previous $100,000 lease-specific 
bond required before BOEM will execute a commercial lease or approve an 
assignment of an existing commercial lease with a bond or other 
authorized financial assurance in the amount of 12 months' rent. This 
will ensure that the lessee is not under-bonded during the preliminary 
term of a lease if annual rent exceeds $100,000, which it often does. 
BOEM removed the existing Sec.  585.515 as surplus in light of this 
other change, as that section relates to a ``flat-fee'' bond that would 
no longer be required. Section 585.515 previously subjected the minimum 
base bond to adjustment every five years based on changes to the 
Consumer Price Index-All Urban Consumers, but such adjustment is no 
longer necessary if the initial bond amount is tied to the annual rent 
for the lease. Under this final rule, Sec.  585.515 is reserved.
    Second, BOEM amended the timing of the SAP decommissioning bond in 
paragraph (a)(2) so that it is due before the installation of SAP 
facilities, rather than at the time of SAP approval. This change was 
made in recognition of the fact that liability for SAP facilities does 
not accrue until installation.
    Third, BOEM eliminated the bond or other financial assurance that 
was previously due before COP approval, for the reasons set forth in 
section Risk Management and Financial Assurance section of Section III 
above.
    Fourth, BOEM made several revisions to the decommissioning 
financial assurance requirement. Most importantly, this final rule 
establishes that a lessee may propose--and BOEM may approve or 
disapprove--incremental funding of a financial assurance instrument 
that satisfies this requirement. This would allow BOEM to approve the 
incremental provision of financial assurance during the operation of 
the facility for the reasons set forth in section Risk Management and 
Financial Assurance section of Section III. This final rule provides 
more flexibility than BOEM's existing regulatory authority, which 
allows decommissioning financial assurance to be provided ``in 
accordance with the number of facilities installed or being 
installed.'' \28\
---------------------------------------------------------------------------

    \28\ 30 CFR 585.516(a)(3).
---------------------------------------------------------------------------

    The remaining changes to this section are intended for 
clarification and organizational purposes. For instance, BOEM has 
adopted the term ``supplemental'' to describe all financial assurance 
for obligations other than the first 12 months' rent. BOEM also has 
removed language in paragraph (b) regarding a lessee's ability to 
increase its financial assurance. The text was redundant of Sec.  
585.517 requirements that a lessee provide financial assurance to cover 
all lease obligations and that BOEM might require additional financial 
assurance at any time during the lease after providing a lessee notice 
and an opportunity to be heard. BOEM changed the timing for providing 
supplemental financial assurance for marine hydrokinetic projects in 
paragraph (c) in recognition that obtaining a FERC license, like the 
approval of a COP, may not itself result

[[Page 42698]]

in the accrual of obligations. The additional flexibility regarding the 
timing of financial assurance will assist BOEM in coordinating with 
FERC.
    Sec.  585.517 How will BOEM determine the amounts of the 
supplemental financial assurance requirements associated with 
commercial leases?
    This final rule adopts the proposed changes in the NPRM and, in 
addition, updates this section to reference the BSEE-administered 
regulations at 30 CFR part 285, subpart I. The changes, as described in 
the NPRM, are for clarity and do not have a substantive impact., and 
BOEM did not receive any comments on this section.
    Sec. Sec.  585.518-585.519 [Reserved]
Financial Assurance for Limited Leases, Row Grants and Rue Grants
    Sec.  585.520 What financial assurance must I provide when I obtain 
my limited lease, ROW grant, or RUE grant?
    The final rule adopts the provisions of the proposed rule to make 
technical changes and to provide that the lessee or assignee of a 
limited lease, or a grantee or an assignee of a ROW or RUE grant, must 
guarantee compliance with all terms and conditions of the lease or 
grant by providing a bond or other authorized financial assurance in 
the amount of 12 months' rent.
    Please refer to section Risk Management and Financial Assurance 
section of Section III for additional discussion of the public comments 
related to this section and BOEM's responses to those comments.
    Sec.  585.521 Do my financial assurance requirements change as 
activities progress on my limited lease or grant?
    The final rule implements the proposed changes to this section as 
described in the NPRM and makes one technical correction. The estimated 
cost of facility decommissioning is now specified to be ``as required 
by 30 CFR part 285, subpart I,'' in reference to the BSEE-administered 
regulations.
    Please refer to section Risk Management and Financial Assurance 
section of Section III for additional discussion of the public comments 
related to this section and BOEM's responses to those comments.
    Sec. Sec.  585.522-585.524 [Reserved]
Requirements for Financial Assurance Instruments
    Sec.  585.525 What general requirements must a financial assurance 
instrument meet?
    No changes were proposed for this section. This final rule adds no 
additional changes. BOEM received no comments on this section.
    Sec.  585.526 What instruments other than a surety bond may I use 
to meet the financial assurance requirement?
    BOEM is finalizing this section as proposed. This final rule makes 
minor grammatical changes to paragraphs (a)(7)(i) and (a)(9). The 
initial required expiration date was also changed from one year to not 
less than 90 days in paragraph (a)(7)(iv). Letters of credit are often 
valid for one year when they are granted from the bank, but if it takes 
more than one day for submission, processing, and approval to ``become 
effective'' then it is no longer valid for a full year. Changing the 
one-year requirement to not less than 90 days will resolve this issue 
and maintain consistency with paragraph (a)(7)(v), which provides that 
BOEM needs to be notified if the letter of credit won't be valid for 
more than 90 days.
    Sec.  585.527 May I demonstrate financial strength and reliability 
to meet the financial assurance requirement for lease or grant 
activities?
    BOEM requested comments on this section in the NPRM section V.G.3.e 
``Other Financial Assurance Provisions.'' Please refer Risk Management 
and Financial Assurance section of Section III for discussion of the 
public comments related to this section and BOEM's responses to those 
comments.
    The existing regulations list the following criteria in making the 
determination of financial strength and reliability: audited financial 
statements, business stability, reliability, and compliance with 
regulations. This rulemaking replaces those four criteria with two new 
criteria: credit rating and the ratio of projected revenue to 
decommissioning liability. This rulemaking also sets the acceptable 
threshold(s) for credit ratings, as described in more detail above in 
Risk Management and Financial Assurance section of Section III.
    Paragraph (a) allows a credit rating from an NRSRO and paragraph 
(b) allows a proxy credit rating determined by BOEM. Co-lessee or co-
grant-holder financial strength is used to determine financial strength 
and reliability in paragraph (c). The minimum threshold for adequate 
financial strength in paragraphs (a), (b), and (c) is an investment 
grade credit rating, either BBB- from Standard and Poor's (S&P), Baa3 
from Moody's, or an equivalent rating from another NRSRO.
    Paragraph (d) describes how, for a lessee without an investment 
grade credit rating, BOEM may consider the contracted revenue from 
electricity generation relative to its operating expenses (net income) 
and the decommissioning obligations associated with that generation. 
Contracted revenue could include revenue from a power purchase 
agreement, renewable energy production credit, or other arrangement 
with a counterparty. For a lessee, if its net income is at least three 
times its estimated decommissioning expenses associated with the 
facilities that will generate that income, BOEM could use the 
contract(s) to determine the lessee's financial strength and 
reliability.
    Existing paragraphs (b) and (c) were redesignated as paragraphs (e) 
and (f) and were modified to reflect the new financial strength and 
reliability assessments. The submission deadline of March 31 was 
removed in paragraph (e) to accommodate lessees that do not report 
annual financial information as of December 31st. Lessees will still be 
required to submit annual financial statements, but the submission 
timeline will depend on the fiscal year of each lessee. Revised 
paragraph (f) removes the reference to information required by the 
existing paragraph (a) because those criteria, audited financial 
statements, business stability, reliability, and compliance, will no 
longer be used in BOEM's evaluations.
    Sec.  585.528 May I use a third-party guaranty to meet the 
financial assurance requirement for lease or grant activities?
    BOEM requested comments on this section in the NPRM section V.G.3.e 
``Other Financial Assurance Provisions.'' Please refer to the Risk 
Management and Financial Assurance section of Section III for 
discussion of the public comments related to this section and BOEM's 
responses to those comments.
    The final rule in paragraph (a)(1) of this section requires that a 
guarantor meet the credit rating criteria in Sec.  585.527(a) for 
financial strength and reliability, as described in more detail in Risk 
Management and Financial Assurance section of Section III. Other 
financial assurance provisions--credit ratings and modifies paragraph 
(a)(2) for clarity. BOEM revised paragraph (b) to allow a third-party 
guaranty to be limited to a fixed dollar amount. Paragraph (c) was 
added to specify what occurs if a guarantor no longer meets the 
criteria in paragraph (a)(1). Paragraph (d)(5) was removed as it was 
identical in purpose to (d)(3) and the subsequent paragraphs in (d) 
were renumbered to reflect this change. The remaining paragraphs in 
this section were modified to update references that changed due to the 
Reorganization Rule. The reference to ``operating rights owner'' in 
paragraph (d)(4) was also

[[Page 42699]]

removed since that is a legal status that exists in the offshore oil 
and gas regulatory framework but not in the legal framework for OCS 
renewable energy leases.
    Sec.  585.529 Can I use a lease- or grant-specific decommissioning 
account to meet the financial assurance requirements related to 
decommissioning?
    In this final rule, BOEM updated paragraphs (a)(2) through (4) by: 
(1) Clarifying that the lessee must fund the account in the amount 
determined by and according to the payment schedule approved by BOEM; 
(2) Adding a note to the effect that BOEM will estimate the cost of 
decommissioning, including site clearance; (3) Adding a provision that, 
subject to BOEM's approval, a decommissioning account may be funded in 
whole or in part during the operations period of a lease or grant; and 
(4) Noting that BOEM may modify an approved payment schedule if it 
determines such a modification to be justified by a material change in 
circumstances. These changes are also discussed in more detail in Risk 
Management and Financial Assurance section of Section III. The final 
rule also inserts a semi-colon at the end of paragraph (a)(1) that was 
inadvertently removed in the NPRM.
Changes in Financial Assurance
    Sec.  585.530 What must I do if my financial assurance lapses?
    The final rule makes minor corrections, as proposed, to the 
existing regulations by adding ``your'' before third-party guarantor 
and removing the subsequent comma.
    Sec.  585.531 What happens if the value of my financial assurance 
is reduced?
    No changes were proposed for this section. This final rule adds no 
additional changes. BOEM received no comments on this section.
    Sec.  585.532 What happens if my surety wants to terminate the 
period of liability of my financial assurance?
    BOEM did not receive any comments on this section and is finalizing 
the section as proposed. The word ``bond'' was replaced by the term 
``financial assurance,'' consistent with the same change made 
throughout the BOEM-administered regulations. Also, a surety must now 
submit a request to terminate the period of liability 90 days before 
the proposed termination date.
    Sec.  585.533 How does my surety obtain cancellation of my 
financial assurance?
    BOEM did not receive any comments on this section. Paragraphs (c) 
and (d) will be combined to better state that financial assurance may 
not be cancelled after 7 years if there are any associated appeals or 
litigation; the remainder of the section is finalized as proposed. The 
term ``cancel'' is now used throughout this section for consistency 
instead of ``release.'' The ``only if'' conditional was replaced with a 
timing clause stating when cancellation would occur.
    Sec.  585.534 When may BOEM cancel my financial assurance?
    BOEM did not receive any comments on this section and is finalizing 
the section as proposed. The first column of the chart now lists the 
different types of financial assurance, and the second column lists the 
cancellation requirements. The cancellation requirements have been 
expanded to include several new situations. Also, a clause was added to 
allow reinstatement of financial assurance in certain situations.
    Sec.  585.535 Why might BOEM call for forfeiture of my financial 
assurance?
    BOEM did not receive any comments on this section and is finalizing 
the section as proposed. The term ``bond'' is replaced with ``financial 
assurance.''
    Sec.  585.536 How will I be notified of a call for forfeiture?
    No changes were proposed for this section and no changes were made 
to this section in this final rule.
    Sec.  585.537 How will BOEM proceed once my bond or other security 
is forfeited?
    No changes were proposed for this section and no changes were made 
to this section in this final rule.
    Sec. Sec.  585.538-585.539 [Reserved]
Revenue Sharing With States
    Sec.  585.540 How will BOEM equitably distribute revenues to 
States?
    As proposed, this final rule changes this section to update the 
cross-reference to the ``Definitions'' section of the rule from Sec.  
585.112 to Sec.  585.113, corresponding to the renumbering of the 
sections that is being implemented with this final rule.
    Sec.  585.541 What is a qualified project for revenue sharing 
purposes?
    As proposed, the final rule makes a technical correction to this 
section to remove the word ``nautical'' as redundant given the 
definition of ``miles'' in Sec.  585.113, which defines ``miles'' to 
mean nautical miles.
    Sec.  585.542 What makes a State eligible for payment of revenues?
    As proposed, the final rule makes a technical correction to this 
section to remove the word ``nautical'' as redundant given the 
definition of ``miles'' in Sec.  585.113, which defines ``miles'' to 
mean nautical miles.
    Sec.  585.543 Example of how the inverse distance formula works.
    No changes were proposed for this section and no changes were made 
to this section in this final rule.
    Sec. Sec.  585.544-585.599 [Reserved]

H. 30 CFR Part 585, subpart G--Plans and Information Requirements

    Subpart F, Plans and Information Requirements, has being 
redesignated as subpart G to accommodate the addition of a new subpart 
B, as noted in Renewable Energy Leasing Schedule section of Section III 
above.
    Sec.  585.600 What plans must I submit to BOEM before I conduct 
activities on my lease or grant?
    The existing regulations required lessees to submit a SAP for BOEM 
approval before conducting any site assessment activities on their 
commercial leases. Consistent with the proposed rule, under this final 
rule, in Sec.  585.600(a)(1), SAPs are required only for site 
assessment activities involving met towers or other facilities that are 
installed on the seabed using a fixed-bottom foundation requiring 
professional engineering design and assessment of sediment, 
meteorological, and oceanographic conditions as part of the design. 
This change is intended to exempt floating site assessment facilities, 
such as met buoys, from the SAP requirement, and is being implemented 
for the reasons set forth in Site Assessment Facilities section of 
Section III. The changes to these regulatory provisions will not affect 
the applicability of other agencies' statutory and regulatory 
requirements.
    Under the final rule a lessee planning to install an industry-
standard met buoy using a gravity anchor for site assessment will no 
longer be required to submit a SAP. If a lessee is uncertain whether 
its proposed site assessment facility would have the type of foundation 
that could trigger the SAP requirements, the lessee should consult with 
BOEM.
    A commenter recommended deleting ``engineered foundation'' from the 
definitions in proposed Sec.  585.113 as well as eliminating a 
reference to it which was included in proposed Sec.  585.600(a)(1) to 
``avoid confusion, given that it only applies to met towers and no 
other structures.'' BOEM agrees with this approach given that the term 
``engineered foundation'' was only intended to be used in the SAP 
provisions of the rule and elected not to include this term in either 
the definitions nor in Sec.  585.600(a)(1) in the final rule. BOEM 
determined the reference to an ``engineered foundation'' in proposed 
Sec.  585.600(a)(1) was redundant with the proposed inclusion of 
``fixed-bottom foundation requiring

[[Page 42700]]

professional engineering design and assessment of sediment, 
meteorological, and oceanographic conditions as part of the design.'' 
Therefore, BOEM determined the use of ``engineered foundation'' was 
unnecessary while leaving the latter language intact in the final rule. 
These comments and revisions are also discussed in the preamble in Site 
Assessment Facilities section of Section III.
    As proposed, the final rule adds language to paragraph (b) to 
recognize BOEM's discretion to waive certain information or analysis 
requirements in a proposed plan if the applicant can demonstrate that, 
among other things, the information or analysis is known to BOEM, the 
relevant resource is not present or affected, or the information is not 
needed or required by a State's coastal management program. The 
language in this provision, modeled on BOEM's oil and gas regulations 
at 30 CFR 550.201(c), would grant BOEM more flexibility to tailor its 
plan requirements to unique elements of a specific proposal without 
needing to issue regulatory departures under Sec.  585.103.
    Sec.  585.601 When must I submit my plans to BOEM?
    The existing regulations required the submittal of a SAP no later 
than 12 months after the date of lease or grant issuance. BOEM saw no 
persuasive reason for this requirement in Sec.  585.601(a) and removed 
it in this final rule as proposed. In doing so, BOEM will provide 
useful flexibility to lessees and grantees without any notable 
downside. Some lessees have chosen to file a COP prior to a SAP, and 
there may be other instances where additional data collection methods 
that would require a SAP are undertaken after the filing of the COP. 
BOEM expects that the requirement will have little application given 
that SAPs are no longer required for met buoys, because nearly all SAPs 
submitted to date have been for met buoys. Moreover, removing this 
deadline is consistent with the overhaul of lease periods that BOEM is 
finalizing in this rule at Sec.  585.235, which includes elimination of 
the ``site assessment term'' by consolidating it into the ``preliminary 
period.'' With this final rule, BOEM will allow a lessee or grantee to 
submit a SAP anytime during the term of its lease or grant but will 
continue to require a lessee or grantee to submit a SAP before 
conducting any activities that require a SAP.
    In the final rule Sec.  585.601(b) and (c), BOEM revised the timing 
for COP submittal to be more consistent with the changes to the lease 
periods in Sec.  585.235. Under this final rule, a COP is due by the 
end of the preliminary period. In this final rule, BOEM clarifies that 
a GAP is due by the end of the preliminary period for a limited lease, 
or a preliminary period for a grant consistent with Sec. Sec.  585.236 
and 585.303, respectively. Because lessees and grantees may request 
lease and grant period extensions, BOEM eliminated the specific timing 
from each of these provisions. The remaining changes to this section in 
the final rule are edits for clarity.
    No comments were received on this section.
    Sec.  585.602 What records must I maintain?
    This section was moved to part 285 under BSEE by the Reorganization 
Rule and retained as reserved in the BOEM-administered regulations in 
part 585.
    Sec. Sec.  585.603-585.604 [Reserved]
Site Assessment Plan and Information Requirements for Commercial Leases
    Sec.  585.605 What is a Site Assessment Plan (SAP)?
    As proposed, BOEM is revising Sec.  585.605(a) in this final rule 
to be consistent with its changes to Sec.  585.600(a)(1) and is 
deleting text that it views as duplicative of the requirements set 
forth in Sec. Sec.  585.606 through 585.613 (describing the SAP 
submittal and review process). The remaining changes to the 
redesignated paragraphs (b) and (c) in this final rule are editorial in 
nature and intended only to clarify the existing text. In addition, the 
citation to Sec.  585.810 is replaced with Sec.  285.810 as a result of 
the Reorganization Rule (88 FR 6376). No comments were received on this 
section.
    Sec.  585.606 What must I demonstrate in my SAP?
    As proposed, in this final rule, BOEM removed paragraph (b) of this 
section to discontinue the requirement for a lessee to ``demonstrate 
that your site assessment activities will collect the necessary 
information and data required for your COP, as provided in Sec.  
585.626(a).'' BOEM has determined that this requirement is unnecessary 
because it is not BOEM's responsibility to ascertain at this stage if 
site assessment data will be sufficient to meet the needs of the COP 
review; rather, BOEM intends to focus its review on the potential 
environmental impacts of the site assessment facility itself. Other 
edits in this section are technical corrections or are intended to 
further clarify the text.
    Please refer to Section III for a discussion of comments received 
on this section.
    Sec.  585.607 How do I submit my SAP?
    This final rule eliminates the paper copy requirement SAP 
submission, as proposed, consistent with revised provisions in Sec.  
585.111. BOEM received no comments on this provision.
    Sec. Sec.  585.608-585.609 [Reserved]
Contents of the Site Assessment Plan
    Sec.  585.610 What must I include in my SAP?
    BOEM is clarifying and streamlining the data requirements for SAP 
submission. Most of these changes are driven by changes to the COP 
requirements (as discussed in Geophysical and Geotechnical Surveys 
section of Section III above). BOEM is making similar changes across 
the corresponding SAP and GAP regulations for purposes of consistency. 
A more detailed description of the rationale for these proposed 
revisions can be found in Geophysical and Geotechnical Surveys section 
of Section III, and the analysis of proposed Sec.  585.626 found in the 
NPRM. Some changes made to this section are also discussed in the 
Project Design Envelope section of Section III above. The following 
summarizes the key changes to this section being finalized, as 
proposed:
    First, this final rule adds language in paragraph (a) intended to 
clarify that a lessee may use a PDE in its SAP as discussed in the 
Project Design Envelope section of Section III above. The introductory 
language in paragraph (a) \29\ clarifies that project specific 
information may be provided as a range of parameters. While BOEM is not 
specifying in this rule what that range should be, BOEM's requirement 
cannot be met without providing both a minimum and a maximum value. For 
example, a lessee could propose two types of met tower foundations in 
its SAP but would need to describe which foundation type is expected to 
have the greatest impact on each affected resource. Paragraph (a)(5) 
includes language clarifying that a lessee can propose a range of 
potential locations for its site assessment facility as well as an 
indicative layout (i.e., a less detailed design) as an alternative to a 
location plat. BOEM made additional edits to paragraph (a)(6) to 
clarify that only preliminary design information is required for 
facilities that are deemed complex and significant, while final design 
information is needed for

[[Page 42701]]

facilities that are not deemed complex and significant. Final designs 
would be submitted with the FDR under 30 CFR 285.701 if the project is 
deemed complex and significant under Sec.  585.613(a).
---------------------------------------------------------------------------

    \29\ For clarity, BOEM proposes standardizing the presentation 
of the required content for an SAP, COP, and GAP so that paragraph 
(a) outlines the general informational requirements and paragraph 
(b) outlines the survey and investigations data requirements. The 
equivalent COP and GAP sections would be re-arranged under this 
final rule consistent with this approach.
---------------------------------------------------------------------------

    Second, BOEM is eliminating the existing requirement in paragraph 
(a)(9) that a CVA nomination (if necessary, under Sec.  585.613(a)) 
must be included with the SAP; instead, a lessee will nominate a CVA 
before or after SAP submittal under 30 CFR 285.706. As described 
further in Certified Verification Agent and Engineering Report section 
of Section III above, the intent of decoupling the CVA nomination from 
the SAP, COP, or GAP is to allow a lessee or grantee to obtain the 
benefits of CVA review at the earliest feasible opportunity. In lieu of 
a CVA nomination, a lessee will only need to describe its project 
verification strategy for those proposed activities that would require 
an SAP. For an SAP, this would include an analysis of whether the 
project should be considered complex or significant, thereby triggering 
the design, fabrication, and installation requirements in 30 CFR part 
285, subpart G. Under this final rule, if BOEM determines that the 
project is complex or significant, the lessee or grantee would be 
required to include a general description of its strategy for complying 
with the requirements of 30 CFR part 285, subpart G.
    Third, BOEM is adopting various clarifying and technical edits to 
several other informational requirements in paragraph (a), including 
adopting language from the existing COP informational requirements 
(Sec.  585.626) regarding decommissioning; documents incorporated by 
reference; and lists of Federal, State, and local permits.
    Fourth, this final rule revises the SAP data requirements in 
paragraph (b) to mirror the changes to the COP and GAP regulations. The 
reasons for these changes are described in more detail in Geophysical 
and Geotechnical Surveys section of Section III above and in the 
description of revised Sec.  585.626(b). Note that the detail and 
thoroughness of these data requirements would be commensurate with the 
scope and complexity of the proposed activities. Under Sec.  
585.600(b), lessees could seek waivers of certain data requirements by 
providing their rationale for why that data is unnecessary.
    Finally, as proposed, BOEM is deleting the existing paragraph (c), 
which concerned the simultaneous submittal of an SAP and either a COP 
or (for a marine hydrokinetic project) a FERC license application. BOEM 
believes that paragraph (c) is unnecessary because such simultaneous 
submittals still would be permitted under other provisions of this 
subpart in this final rule and because much of this paragraph is 
repetitive of Sec.  585.601(b).
    Sec.  585.611 What information and certifications must I submit 
with my SAP to assist BOEM in complying with NEPA and other applicable 
laws?
    BOEM is adopting clarifications to the following informational 
requirements in this section that were proposed in the NPRM. These 
proposed clarifications are consistent with BOEM's present expectations 
for SAP submittals and, therefore, should not create additional burdens 
on lessees:
     Information about resources, conditions, and activities 
that your proposed activities may significantly affect or that may have 
a significant effect on your proposed activities (including where the 
potential significance of the effect is unknown) and must contain any 
other information required by law. This edit is consistent with 
comments made and incorporated into the COP regulations at Sec.  
585.627(a) and is, consistent with NEPA, as amended by the Fiscal 
Responsibility Act in 2023.
     Water quality information would explicitly include impacts 
from vessel discharges, as is already required under the CWA.
     Archaeological resources information would explicitly 
include information on all types of historic properties, as is already 
required under the NHPA.
     Coastal and marine uses information would explicitly 
include assessments of fisheries and navigational safety risk. Lessees 
would be required to submit the latter assessment to the USCG.
    Additionally, in the section heading and regulatory text, the more 
appropriate phrase ``applicable laws'' would replace ``relevant laws.'' 
The remaining changes to this section include edits for improved 
organization, clarity, or consistency, including moving most of the 
language from the existing paragraph (b) into a new paragraph (c).
    See Section III for a discussion of a comment received on this 
section.
    Sec.  585.612 How will my SAP be processed for Federal consistency 
under the Coastal Zone Management Act?
    BOEM is modifying paragraph (a) to add that the submittal to BOEM 
must conform with the requirements of Sec.  585.111. BOEM is clarifying 
in paragraph (b) that lessees need to submit a consistency 
certification for their SAPs under 15 CFR part 930, subpart E, only if 
BOEM has not previously submitted a consistency determination to that 
State under 15 CFR part 930, subpart C, that covered the proposed site 
assessment activities, as opposed to always providing the submittal as 
described in the previous version of the regulations. The existing 
regulations require lessees to submit a consistency certification in 
all cases.
    BOEM, in consultation with NOAA, finds that implementation of the 
OCS renewable energy program thus far shows that there are three 
potential CZMA Federal consistency reviews \30\ related to BOEM's 
actions: (1) when BOEM conducts a lease sale and awards a lease, ROW, 
or RUE and provides a state or states with a CZMA consistency 
determination under 15 CFR part 930, subpart C; (2) when an applicant 
submits a CZMA consistency certification to BOEM for a SAP, COP, or 
GAP, if required by 15 CFR part 930, subpart E; and (3) when the 
activity is located outside a geographic location described in the 
state's coastal management program pursuant to 15 CFR 930.52, and an 
applicant, on its own accord, submits a consistency certification to a 
state or states through BOEM under 15 CFR part 930, subpart E. For the 
lease sales held so far, states have reviewed associated SAP activities 
through the review of BOEM's consistency determination under 15 CFR 
part 930, subpart C. BOEM and NOAA expect that this will continue and 
that it should be the rare case where a separate CZMA consistency 
review is required for an SAP or GAP. BOEM is making clarifying edits 
to this section in the final rule by noting that necessary data and 
information ``required to conduct an adequate consistency review'' will 
be provided along with BOEM's consistency certification.
---------------------------------------------------------------------------

    \30\ This section does not include a hypothetical fourth 
situation where a non-lessee submits a lease application and COP to 
BOEM simultaneously. While permitted by BOEM's regulations, this 
situation is not expected to arise in practice.
---------------------------------------------------------------------------

    See Section III for a discussion of the comments received on this 
section. The changes described here are as proposed.
    Sec.  585.613 How will BOEM process my SAP?
    In this final rule, BOEM is removing ``modification'' and replacing 
it with ``conditions'' to be consistent with other changes to plan 
approvals, as was proposed. BOEM also is harmonizing the existing 
language in paragraph (e)(2) of this section with an equivalent 
provision in Sec.  585.628(f)(2) regarding actions lessees may take in 
the event of SAP disapproval. BOEM is also clarifying that SAP 
resubmission must occur within a reasonable time and

[[Page 42702]]

proposes to make analogous changes to the equivalent COP and GAP 
requirements in Sec. Sec.  585.628 and 585.648. Other edits to this 
section are editorial in nature and intended only to clarify the 
existing text. See Section III for a discussion of the comments 
received on this section. The changes described here are as proposed.
Activities Under an Approved Sap
    Sec.  585.614 When may I begin conducting activities under my 
approved SAP?
    BOEM has made a minor edit to paragraph (b), as proposed, by adding 
the word ``description'' after Safety Management System (SMS) to 
clarify that it is a description of the Safety Management System that 
must be submitted, in conformance with the requirements in 30 CFR 
285.810. In addition, the citation to Sec.  585.810 is replaced with 30 
CFR 285.810 as a result of the Reorganization Rule (88 FR 6376).
    Sec.  585.615 What other reports or notices must I submit to BOEM 
under my approved SAP?
    To be consistent with the Reorganization Rule (88 FR 6376), in the 
final rule, BOEM deleted the existing dual requirements of informing 
BOEM within 30 days of completing the installation of facilities in an 
approved SAP and the certification of annual compliance with the terms 
of the SAP. The only remaining requirement is that the lessee must 
prepare and submit to BOEM a report annually on November 1 of each year 
that summarizes the site assessment activities and the results of those 
activities. BOEM will continue to withhold trade secrets and commercial 
or financial information that is privileged or confidential from public 
disclosure under exemption 4 of the Freedom of Information (FOIA) and 
as provided in Sec.  585.114 (formerly Sec.  585.113). No comments were 
received on this section.
    Sec.  585.616 [Reserved]
    Sec.  585.617 What activities require a revision to my SAP, and 
when will BOEM approve the revision?
    As proposed, this final rule makes revisions to this section. BOEM 
is revising paragraph (a) consistent with changes BOEM made to Sec.  
585.600(a)(1), which limits the applicability of SAPs to facilities 
that are installed on the seabed using a fixed-bottom foundation 
requiring professional engineering design and assessment of sediment, 
meteorological, and oceanographic conditions as part of the design. The 
changes to this section include the addition of a new paragraph (b) to 
clarify that revisions to a lessee's SAP may trigger a reassessment of 
the significance and complexity of the facility or facilities described 
in the revised SAP. This final rule also revises paragraph (d) to 
eliminate unnecessary verbiage in the list of changes or modifications 
that could trigger the revision of an approved SAP by merging the 
substance of existing paragraphs (c)(4), (5), and (6) into revised 
paragraphs (d)(2) and (3). In the final rule, BOEM made additional 
edits in response to comments to further clarify the scope of paragraph 
(d), by specifying that OCS activities that could have significant 
environmental impacts, or that may affect threatened or endangered 
species, or that may affect designated critical habitat of such 
species, or that may result in incidental take of marine mammals, may 
trigger revisions. BOEM is also aligning this section with the PDE 
concept as described Project Design Envelope section of Section III 
above, to ensure consistency with the Sec.  585.610(a)(5). This final 
rule makes minor additional editorial changes to improve clarity and 
readability. See Section III for a discussion of the comments received 
on this section.
    Sec.  585.618 What must I do upon completion of approved site 
assessment activities?
    This final rule adopts the technical edits proposed in paragraph 
(a) to ensure consistency with changes to Sec.  585.235, which 
eliminated the site assessment term of a commercial lease. Paragraph 
(a) applies only if site assessment facilities are installed before COP 
submittal.
    Paragraph (e) of the existing regulation states that ``you must 
initiate the decommissioning process [for your site assessment 
activities] . . . upon termination of your lease.'' However, BSEE's 
regulations in 30 CFR part 285, subpart I, require lessees to initiate 
the decommissioning process by submitting a decommissioning application 
as much as two years before the lease expires. BOEM is adopting the 
changes proposed to this section in the NPRM for clarity and 
consistency with Sec. Sec.  285.905 and 285.906. BOEM received no 
comments on these revisions.
    Sec.  585.619 [Reserved]
Construction and Operations Plan for Commercial Leases
    Sec.  585.620 What is a Construction and Operations Plan (COP)?
    As a result of the Reorganization Rule (88 FR 6376), BOEM is 
replacing the cross reference to Sec.  585.113 with Sec.  585.114 in 
this final rule. No other changes were made to this section.
    Sec.  585.621 What must I demonstrate in my COP?
    As proposed, this final rule makes technical edits to this section 
to ensure consistency with changes to Sec.  585.606 for SAPs discussed 
above.
    Sec.  585.622 How do I submit my COP?
    This final rule eliminates the paper copy requirement for COP 
submission, as proposed, consistent with the revised provisions in 
Sec.  585.111.
    Sec. Sec.  585.623-585.625 [Reserved]
Contents of the Construction and Operations Plan
    Sec.  585.626 What must I include in my COP?
    BOEM is clarifying and streamlining the data requirements for COP 
submission in several key respects.
    First, this final rule adds language in paragraph (a) clarifying 
that a lessee may use a PDE in its COP, as further discussed above in 
sections Project Design Envelope, Geophysical and Geotechnical Surveys 
of Section III, and the analysis of Sec.  585.610.
    Second, BOEM is replacing the existing obligation in paragraph 
(a)(18) to submit a CVA nomination with the COP with a requirement to 
submit a ``project verification strategy'' describing the lessee's plan 
for complying with BSEE's regulations at 30 CFR 285.705 through 
285.714. As discussed further in Certified Verification Agent and 
Engineering Report section of Section III, this amendment provides 
lessees with the flexibility to nominate (and for BSEE to approve) a 
CVA either before or after COP submittal.
    Third, this final rule makes both clarifying and substantive 
changes to the data submittal requirements in this section. Most of the 
proposed changes relate to nomenclature and organization and are 
intended to more precisely reflect BOEM's expectations for a lessee's 
COP surveys. For instance, BOEM is merging the ``shallow hazards,'' 
``geological,'' ``geotechnical,'' and ``site investigation'' survey 
requirements in paragraphs (a)(1), (2), (4), and (6) into ``geological 
and geotechnical'' survey requirements set forth in a new Sec.  
585.626(b)(1). BOEM believes this change clarifies the intent of the 
regulations, minimizes any stakeholder confusion and will reduce 
redundancy. The shallow hazards survey is part of both geological and 
geotechnical surveys (and thus does not actually constitute an 
independent survey), geological and geotechnical surveys have 
overlapping purposes, and the ``site investigation'' is effectively an 
amalgam of the above-described surveys.

[[Page 42703]]

    The geological and geophysical survey provisions in Sec.  
585.626(b)(1) are replacing the prescriptive requirements with 
performance-based standards focused on the sufficiency of information 
regarding geological site conditions that BOEM needs in order to 
adequately review a COP. In particular, BOEM is eliminating the 
requirements in existing Sec.  585.626(a)(1) regarding shallow hazard 
surveys as well as the requirements in existing Sec.  585.626(a)(4) 
that lessees submit ``[t]he results of adequate in situ testing, 
boring, and sampling at each foundation location'' and ``[t]he results 
of a minimum of one deep boring (with soil sampling and testing) at 
each edge of the project area.'' Instead, BOEM will require geological 
and geotechnical data sufficient to ``define the baseline geological 
conditions of the seabed and provide sufficient data to develop a 
geologic model, assess geologic hazards, and determine the feasibility 
of the proposed site for your proposed facility.''
    BOEM believes that these new standards will provide it with 
flexibility to tailor its data requirements to site- and project-
specific conditions without needing to issue regulatory departures 
under Sec.  585.103. To ensure BOEM will continue to have sufficient 
information to conduct an environmental analysis and the necessary 
interagency consultations, BOEM will continue performing a sufficiency 
review after receipt of a COP and notifying the lessee of any 
additional outstanding information requirements prior to completing the 
COP review. More importantly, the deferral of the in situ boring 
requirement will address the concerns raised by lessees and described 
in detail in Geophysical and Geotechnical Surveys section of Section 
III. This final rule will not reduce the quality of geotechnical data 
that BOEM will review before the start of construction. Geophysical 
surveys will still need to identify all relevant shallow hazards, and 
the results of certain detailed geotechnical surveys to inform 
engineering decisions, which will include data from in situ 
explorations, would now need to be submitted with the FDR as set forth 
in BSEE's regulations in 30 CFR 285.701.
    With this final rule, BOEM decided not to allow a lessee to submit 
the results of certain detailed subsea archaeological surveys with the 
FDR. BOEM reasoned that sufficient geophysical data is necessary to 
assess potential impacts from offshore wind activities on cultural 
resources and the introduction of a case-by-case deferral of certain 
marine archaeological surveys creates uncertainty for all parties 
participating in consultations conducted according to Section 106 of 
the NHPA. As in its changes to Sec.  585.610, BOEM is also clarifying 
that required reports under paragraph (b)(3) of this section include 
information on all historic properties listed or eligible for listing 
on the National Register of Historic Places in accordance with the NHPA 
and its implementing regulations.
    This final rule also adds paragraph (b)(4) to this section to 
clarify BOEM's need for desktop data on oceanographic and 
meteorological conditions sufficient to ``support preliminary design of 
the facility and support the analysis of wake effects, sediment 
mobility and scour, and navigational risks.'' Existing Sec.  
585.627(a)(1) requires the submittal of similar data on conditions that 
could create hazards for a project. BOEM believes obtaining more 
comprehensive meteorological and oceanographic information to better 
inform modeling, design, and environmental reviews is necessary and 
appropriate. BOEM has made only clarifying edits to the biological 
survey requirements in this section. BOEM also is making analogous 
changes, where appropriate, in the equivalent regulations for SAPs and 
GAPs in Sec.  585.610 and Sec.  585.645, respectively.
    The remaining changes to this paragraph are edits for organization 
and clarity.
    Sec.  585.627 What information and certifications must I submit 
with my COP to assist BOEM in complying with NEPA and other applicable 
laws?
    In this final rule, BOEM clarified the informational requirements 
in paragraph (a) as proposed in the NPRM. Additional edits were made 
consistent with the changes made to Sec.  585.611(a) for SAPs and to be 
consistent with NEPA as amended in 2023. BOEM also clarified the 
consistency certification requirements in paragraph (b)(1) by revising 
the language to provide that the applicant must certify that the 
proposed activities described in detail in the applicant's plan comply 
with ``the enforceable policies of the applicable States' approved 
coastal management programs (as opposed to ``the State(s) approved 
coastal management program(s)'') and will be conducted in a manner that 
is consistent with such programs.'' This change limits BOEM's interest 
to the enforceable policies of the applicable States' programs, not all 
States' approved coastal management programs.
    BOEM also made a technical correction to paragraph (c). That 
provision required a lessee to submit an OSRP with its COP ``as 
required by 30 CFR part 254.'' Because the cross-referenced regulations 
apply only to OCS oil and gas activities, BOEM is instead requiring 
that a lessee submit an OSRP ``in compliance with 33 U.S.C. 1321, 
including information identified in 30 CFR part 254 that is applicable 
to your activities.'' This statutory provision is not limited to oil 
and gas activities, and grants BOEM and its lessees more flexibility to 
craft OSRPs that are commensurate with the estimated worst-case 
discharge from a renewable energy facility. The regulation clarifies 
that the OSRP must include information identified in 30 CFR part 254 
that is applicable to the lessee's activities.
    BOEM did not add language that a Tribal commenter requested to be 
added to BOEM's required information in SAPs, COPs, and GAPs. The 
revised language would have required lessees to submit information 
about ``culturally significant sites, including viewsheds and 
traditional cultural landscapes and properties, and subsistence rights 
of a federally recognized Tribe.'' Such information is already required 
to be included in plans through requirements to submit ``detailed 
information and analysis to assist BOEM in complying with NEPA and 
other applicable laws,'' including information about ``archaeological 
resources use, or historic property use, Indigenous traditional 
cultural use, or use pertaining to treaty and reserved rights with 
Native Americans or other Indigenous peoples, including required 
information to conduct review of the [plan] under the NHPA or other 
applicable laws or policies, including treaty and reserved rights with 
Native Americans or other Indigenous peoples.'' Although the specific 
language requested was not added to the regulations, BOEM will ensure 
that the priorities identified in the comment are conveyed to the 
reviewers of plans to ensure these requirements are met.
    Additionally, in the section heading and regulatory text, the more 
appropriate phrase ``applicable laws'' replaces ``relevant laws.'' This 
final rule is eliminating the paper copy requirement, consistent with 
revised Sec.  585.111 and makes minor additional editorial changes to 
improve clarity and readability.
    See Section III for a discussion of the comments on this section 
and BOEM's response to those comments.
    Sec.  585.628 How will BOEM process my COP?
    In this final rule, BOEM is adopting the new proposed provisions of 
paragraph (c) stating that, after all information requirements for the 
COP are met and after the appropriate

[[Page 42704]]

environmental assessment or draft environmental impact statement, if 
required, has been published, the lessee or grantee will be required to 
submit its COP, consistency certification, and associated data and 
information under 15 CFR part 930, subpart E, to the applicable State 
CZMA agencies to BOEM after all information requirements for the COP 
are met, and the appropriate environmental assessment or draft 
environmental impact statement, if required, has been published and 
BOEM will forward the COP, consistency certification, and associated 
data and information to the applicable State CZMA agencies. BOEM has 
determined that submitting the COP to the States for Federal 
consistency review prior to the publication of a draft NEPA analysis 
would be premature because the States would not have all the relevant 
information at their disposal to make a State's consistency decision.
    In practical terms, this will change the date on which a COP is 
considered an ``active application'' under 15 CFR 930.51(f). Therefore, 
the CZMA review period (or the start of the 30-day time period for a 
State to submit an unlisted activity review request to NOAA under 15 
CFR 930.54) will start on the date BOEM issues the notice of 
availability for the draft NEPA analysis instead of the date BOEM 
issues the notice of intent to publish a draft NEPA analysis.
    BOEM has made several changes to the project easement requirements 
in paragraph (g). In the final rule, BOEM revised the definition of 
``project easement'' in Sec.  585.113 to mean ``an easement to which, 
upon approval of your Construction and Operations Plan (COP) or (GAP), 
you are entitled as part of the lease for the purpose of installing, 
maintaining, repairing and replacing: gathering, transmission, and 
distribution, and inter-array cables; power and pumping stations; 
facility anchors; pipelines; and associated facilities and other 
appurtenances on the OCS as necessary for the full enjoyment of the 
lease.''
    In order to provide flexibility to the lessee and minimize the need 
for subsequent project easement amendments, BOEM amended paragraph (g) 
to allow BOEM to issue project easements that ``provide sufficient off-
lease area to accommodate potential changes at the design and 
installation phases with respect to any facilities or activities 
necessary for your project.'' Although a larger easement would result 
in greater rental fees under Sec.  585.507, under the final rule a 
lessee may relinquish any unused portions of the easement after 
construction is completed. BOEM believes that this approach will allow 
a lessee to right-size the width of its project easements on a case-by-
case basis, depending on site conditions and a lessee's particular 
needs. This revision is consistent with the PDE strategy described in 
Project Design Envelope section of Section III above because it 
maximizes a lessee's ability to make design choices later in the 
development process without revising its COP or reopening the permit 
review process. BOEM will still require that a COP include sufficient 
survey data for whatever project easement areas are requested. This 
final rule also will not affect the quantity and quality of data that 
BOEM requires before the lessee may commence installation of the export 
cable.
    BOEM has also implemented a technical correction to paragraph 
(g)(3) that would make project easements subject to the same conditions 
as ROWs and RUEs under Sec.  585.302(b): that the United States can 
grant rights in the area to other lessees or grantees that do not 
unreasonably interfere with operations on the easement. Among other 
reasons, these provisions are critical to ensure that nearby existing 
or future offshore wind lessees are not definitively foreclosed from 
using the same general cable routes established by an earlier lessee. 
In the long run, cable routes shared by multiple projects could result 
in lower environmental impacts, streamlined permitting, and economic 
efficiencies.
    Other remaining changes to this section are edits for 
clarification, better organization, and consistency with changes to the 
equivalent SAP and GAP regulations.
    See Section III for further discussion of the comments BOEM 
received on this section and BOEM's response to those comments.
    Sec.  585.629 May I develop my lease in phases?
    The content of this section was moved to Sec.  585.238 and this 
section is now reserved.
    Sec.  585.630 [Reserved]
Activities Under an Approved COP
    Sec.  585.631 When must I initiate activities under an approved 
COP?
    In the NPRM, BOEM proposed to overhaul the organization and 
duration of its commercial leases under Sec.  585.235, including the 
addition of a new design and construction period. The final rule 
includes the design and construction period at Sec.  585.235(a)(3) 
during which design and construction period begins at COP approval and 
ends when the operations period begins. BOEM determined that it was 
confusing and undermined the intent of the creation of a ``design and 
construction period'' to require a lessee to seek advanced approval of 
a deviation in their ``construction schedule'' as stated in the 
existing Sec.  585.631. Therefore, BOEM modified Sec.  585.631 in the 
final rule to specify that a lessee is expected to start construction 
on the OCS in accordance with the construction schedule specified in 
the COP, unless the lessee notifies BOEM in advance.
    Sec.  585.632 What documents must I submit before I may construct 
and install facilities under my approved COP?
    In this final rule, following publication of the Reorganization 
Rule, BOEM is updating the cross references in this section to replace 
BOEM-administered regulations with BSEE-administered regulations with 
respect to the Facility Design Report (from 30 CFR 585.701 to 30 CFR 
285.701), the Fabrication and Installation Report (from 30 CFR 585.702 
to 30 CFR 285.702), and the Safety Management system (from 30 CFR 
585.810 to 30 CFR 285.810).
    Sec.  585.633 [Reserved]
    Sec.  585.634 What activities require a revision to my COP, and 
when will BOEM approve the revision?
    The final rule revises paragraph (c) of this section to maintain 
consistency with the corresponding changes to Sec.  585.617 for 
revisions to SAPs by eliminating unnecessary verbiage in the list of 
changes or modifications that could trigger the revision of an approved 
COP and by merging the substance of existing paragraphs (c)(4), (5), 
and (6) into revised paragraphs (c)(2) and (3). BOEM has also 
incorporated in paragraph (c)(3) the PDE concept for a ``range'' of 
facility locations for the reasons set forth above in sections Project 
Design Envelope and Geophysical and Geotechnical Surveys of Section 
III, and to ensure consistency with updated Sec.  585.626(a). By 
incorporating the PDE, BOEM believes it can be less prescriptive 
regarding the threshold that would trigger a COP revision and can allow 
that threshold to be proportionate to the magnitude of the proposed 
project changes. In response to comments, BOEM further built upon the 
changes in the NPRM by adding references to activities ``on the OCS'' 
and ``that could have significant environmental impacts, or that may 
affect threatened or endangered species, or that may affect designated 
critical habitat of such species, or that may result in incidental take 
of marine mammals for clarity, and for consistency with OCSLA, NEPA, 
and other Federal statutes.

[[Page 42705]]

    See Section III for a discussion of the comment received on this 
section and BOEM's response to the comment.
    Sec.  585.635 What must I do if I cease activities approved in my 
COP before the end of my commercial lease?
    A few technical edits have been added to this section as a result 
of the Reorganization Rule (88 FR 6376). The word ``BOEM'' has been 
replaced with ``BSEE'' in the first sentence. The reference to Sec.  
585.437 is revised as Sec.  585.422. The reference to the subpart I has 
been revised as 30 CFR part 285, subpart I.
    Sec. Sec.  585.636-585-639 [Reserved]
General Activities Plan Requirements for Limited Leases, ROW Grants, 
and RUE Grants
    Sec.  585.640 What is a General Activities Plan (GAP)?
    As proposed, this final rule eliminates the second sentence in 
paragraph (b) because it is redundant of the requirements found in the 
existing and proposed Sec.  585.303(a) regarding the due date for GAP 
submissions. And, in the first sentence of paragraph (b), BOEM has 
removed ``approved'' and replaced it with ``proposed'' because 
activities are proposed until the GAP is approved.
    Sec.  585.641 What must I demonstrate in my GAP?
    As proposed, the final rule makes technical edits to ensure 
consistency with revised Sec. Sec.  585.606 (SAPs) and 585.621 (COPs), 
as appropriate.
    Sec.  585.642 How do I submit my GAP?
    In this final rule, BOEM has eliminated the paper copy requirement 
for GAP submission, consistent with the revised provisions in Sec.  
585.111, as proposed.
    Sec. Sec.  585.643-585.644 [Reserved]
Contents of the General Activities Plan
    Sec.  585.645 What must I include in my GAP?
    BOEM has finalized the changes to this section as proposed in the 
NPRM consistent with its revisions to Sec. Sec.  585.610 (SAPs) and 
585.626 (COPs), as appropriate. This is also discussed in Project 
Design Envelope and Geophysical and Geotechnical Surveys sections of 
Section III.
    Sec.  585.646 What information and certifications must I submit 
with my GAP to assist BOEM in complying with NEPA and other applicable 
laws?
    BOEM has adopted the clarifications to the informational 
requirements in paragraph (b) of this section that were proposed in the 
NPRM and that are similar to those in revised Sec.  585.611(SAPs) and 
in revised Sec.  585.627 (COPs) regarding information about resources, 
conditions, and activities that your proposed activities may 
significantly affect or that may have a significant effect on your 
proposed activities (including where the potential significance of the 
effect is unknown) and must contain any other information required by 
law.
    Additionally, in the section heading and regulatory text, the more 
appropriate phrase ``applicable laws'' has replaced ``relevant laws.''
    BOEM did not receive any substantive comments on this provision.
    Sec.  585.647 How will my GAP be processed for Federal consistency 
under the Coastal Zone Management Act?
    In this final, as proposed, BOEM has made minor changes to provide 
clarity and consistency with other changes, as described in the NPRM. 
BOEM also made analogous revisions to the CZMA provisions for SAPs 
(Sec.  585.612) and COPs (Sec.  585.628).
    Sec.  585.648 How will BOEM process my GAP?
    As proposed, BOEM made minor editorial changes to this section to 
improve clarity, eliminate redundancy, enhance readability, and provide 
consistency with the revisions to Sec. Sec.  585.613 (SAPs), 585.628 
(COPs), and 585.102. In addition, a citation to 30 CFR 285.653(b) is 
added in paragraph (e)(1) as a result of the Reorganization Rule (88 FR 
6376).
    Sec.  585.649 [Reserved]
Activities Under an Approved GAP
    Sec.  585.650 When may I begin conducting activities under my GAP?
    No changes were proposed for this section and no changes were made 
to this section in this final rule.
    Sec.  585.651 When may I construct complex or significant OCS 
facilities on my limited lease or any facilities on my project easement 
proposed under my GAP?
    To be consistent with the Reorganization Rule (88 FR 6376), this 
final rule modifies this section to cross-reference the SMS 
requirements of BSEE's regulations. The new regulations specify that, 
if a lessee is applying for a project easement, or installing a 
facility or a combination of facilities on a limited lease deemed by 
BOEM to be complex or significant, as provided in Sec.  585.648(a)(1), 
the lessee must now also comply with the requirements of 30 CFR part 
285, subpart G, and submit its safety management system description 
required by 30 CFR 285.810 before construction may begin. The existing 
regulations only referenced complying with SMS requirements, without 
mentioning where these regulations were located, or the specific 
requirements to be met.
    Sec.  585.652 How long do I have to conduct activities under an 
approved GAP?
    As proposed, BOEM made a technical revision to paragraph (a) to 
maintain consistency with its modifications to the limited lease 
periods in Sec.  585.236. In the final rule, paragraph (a) is further 
revised by replacing ``terms'' with ``operations period'' to be 
consistent with Sec.  585.236(a)(2), which establishes the operations 
period for a limited lease.
    Sec.  585.653 What other reports or notices must I submit to BOEM 
under my approved GAP?
    To be consistent with the Reorganization Rule (88 FR 6376), BOEM 
removed paragraphs (a) and (c) from this section and revised the 
citation in paragraph (b) (now undesignated) from Sec.  585.113 to 
Sec.  585.114.
    Sec.  585.654 [Reserved]
    Sec.  585.655 What activities require a revision to my GAP, and 
when will BOEM approve the revision?
    As proposed, BOEM made clarifications and technical edits to the 
provisions regarding GAP revisions in paragraphs (a) and (c) that are 
analogous to the revisions to Sec. Sec.  585.617 (SAP revisions) and 
585.634 (COP revisions). In response to comments, BOEM further built 
upon the changes by adding references to activities ``that could have 
significant environmental impacts, or that may affect threatened or 
endangered species, or that may affect designated critical habitat of 
such species, or that may result in incidental take of marine mammals 
for clarity, and for consistency with OCSLA, NEPA, and other Federal 
statutes.''
    Sec.  585.656 What must I do if I cease activities approved in my 
GAP before the end of my term?
    No changes were proposed for this section and no changes were made 
to this section in this final rule.
    Sec.  585.657 What must I do upon completion of approved activities 
under my GAP?
    BOEM clarified in the final rule that a lessee or grantee must 
decommission its project as set forth in 30 CFR part 285, subpart I, 
and submit a decommissioning application to BSEE as set forth in 30 CFR 
285.905 and 285.906, which is analogous to the changes to the 
corresponding SAP and COP requirements in Sec. Sec.  585.618(e) and 
285.638, respectively. These changes are consistent with the 
Reorganization Rule (88 FR 6376).
Cable and Pipeline Deviations
    Sec.  585.658 Can my cable or pipeline construction deviate from my 
approved COP or GAP?

[[Page 42706]]

    No changes were proposed for this section and no changes were made 
to this section in this final rule.
    Sec. Sec.  585.659-585.699 [Reserved]
Environmental Protection Requirements Under Approved Plans
    Sec.  585.700 What requirements must I include in my SAP, COP, or 
GAP regarding air quality?
    In the NPRM, the citation for this section was Sec.  585.659. The 
Reorganization Rule (88 FR 6376) changed the citation for this section 
to Sec.  585.700. As proposed, BOEM made a technical correction to 
reflect Congress' 2011 CAA amendment expanding BOEM's air quality 
jurisdiction to offshore of the North Slope Borough of Alaska.\31\ As 
mentioned earlier, Sec.  585.659 is reserved in the final rule.
---------------------------------------------------------------------------

    \31\ 42 U.S.C. 7627.
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    Sec.  585.701 How must I conduct my approved activities to protect 
marine mammals, threatened and endangered species, and designated 
critical habitat?
    In the NPRM, the citation for this section was Sec.  585.801. The 
Reorganization Rule (88 FR 6376) changed the citation for this section 
to Sec.  585.701. Technical edits for consistency with the Marine 
Mammal Protection Act were made to Sec.  585.701(b) and (e). No other 
changes were made to this section.
    Sec.  585.702 What must I do if I discover a potential 
archaeological resource while conducting my approved activities?
    In the NPRM, the citation for this section was Sec.  585.802. The 
Reorganization Rule (88 FR 6376) changed the citation for this section 
to Sec.  585.702. No other changes were made to this section.
    Sec.  585.703 How must I conduct my approved activities to protect 
essential fish habitats identified and described under the Magnuson-
Stevens Fishery Conservation and Management Act?
    In the NPRM, the citation for this section was Sec.  585.803. The 
Reorganization Rule (88 FR 6376) changed the citation for this section 
to Sec.  585.703. No other changes were made to this section.

VI. Procedural Matters--Statutory and Executive Order Reviews

A. Executive Order 12866: Regulatory Planning and Review, as amended by 
Executive Order 14094: Modernizing Regulatory Review, and Executive 
Order 13563: Improving Regulation and Regulatory Review

    E.O. 12866, as amended by E.O. 14094, provides that the Office of 
Information and Regulatory Affairs (OIRA) in the Office of Management 
and Budget (OMB) will review all significant rules. OIRA has determined 
that this rule is a significant action under section 3(f)(1) of E.O. 
12866, as amended by E.O. 14094. This rulemaking will result in an 
annual effect on the economy of $200 million or more (adjusted every 3 
years by the Administrator of OIRA for changes in gross domestic 
product); 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, territorial, or Tribal 
governments or communities.
    E.O. 13563 reaffirms the principles of E.O. 12866, as amended by 
E.O. 14094, while calling for improvements in the Nation's regulatory 
system to promote predictability and reduce uncertainty, and to use the 
best, most innovative, and least burdensome tools for achieving 
regulatory ends. E.O. 13563 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. BOEM and BSEE have developed 
this rule in a manner consistent with these requirements.
    Because this action is a significant regulatory action, it was 
submitted to OMB for review. BOEM, on behalf of the Department, 
prepared an analysis of the potential costs and benefits associated 
with this action. This analysis, ``Renewable Energy Modernization Rule 
Final Regulatory Impact Analysis'' is available in the docket. A brief 
description of cost and benefit analysis is also provided in the 
Summary of Cost, Economic Impacts, and Additional Analyses Conducted 
section of Section IV in the preamble.

B. Regulatory Flexibility Act (RFA)

    The Regulatory Flexibility Act (RFA), 5 U.S.C. 601-612, requires 
agencies to analyze the economic impact of regulations when a 
significant economic impact on a substantial number of small entities 
is likely and to consider regulatory alternatives that will achieve the 
agency's goals while minimizing the burden on small entities. Pursuant 
to section 603 of the RFA, BOEM, on behalf of the Department, prepared 
a regulatory flexibility impact analysis that examined the impacts of 
the proposed rule on small entities along with regulatory alternatives 
that could minimize that impact. The results of recent BOEM renewable 
energy auctions have demonstrated that companies interested in 
developing OCS wind energy resources (i.e., companies that have 
submitted bids in BOEM auctions) are all either large firms or partners 
with large firms in joint ventures. Commercial-scale projects cost 
hundreds of millions to billions of dollars to install and operate. As 
a result, it is unlikely that small entities will be independently 
constructing or operating OCS wind facilities in the foreseeable 
future. The cost savings associated with this rule are available to all 
companies developing and operating OCS renewable energy facilities. If 
small companies do participate in the OCS renewable energy industry 
moving forward, the cost savings from this rule would benefit them 
accordingly. Therefore, BOEM has determined that the rule would not 
likely cause a significant economic impact on a substantial number of 
small entities. The regulatory flexibility impact analysis was provided 
in the docket for public comment (Renewable Energy Modernization Rule: 
Initial Regulatory Impact Analysis, Docket No. BOEM-2023-0005).
    This final action will not have a significant economic impact on a 
substantial number of small entities under the RFA. This action will 
not impose any unique requirements on small entities. This final rule 
would directly affect all current and future OCS renewable energy 
developers, as discussed in the NPRM. BOEM has prepared a final 
regulatory flexibility impact analysis, which is available in the 
docket for this rulemaking (Docket No. BOEM-2023-0005).
    BOEM received two comments specific to the RIA. One commenter 
asserted that BOEM's definition of the baseline scenario in the 
existing regulatory framework does not consider the impacts to small 
fishing businesses and small coastal communities and suggested that 
BOEM conduct a regulatory impact analysis due to these potential 
impacts. Another commenter discussed the cost-benefits analysis of the 
proposed rule, including discussion of the RIA. The commenter suggested 
that, in accordance with Circular A-4, BOEM should continue its cost-
benefits analysis of the proposed rule after it has been enacted to 
measure the cost-savings associated with climate impacts of OSW 
development, to assess costs to coastal communities, and to consider 
impacts to marine ecology, health and safety, social cost of carbon, 
and other unforeseen costs.

C. Small Business Regulatory Enforcement Fairness Act (SBREFA)

    The Small Business Regulatory Enforcement Fairness Act (SBREFA), 5

[[Page 42707]]

U.S.C. 804(2), requires the Department to perform a regulatory 
flexibility analysis, provide guidance, and help small businesses 
comply with statutes and regulations for major rulemakings. This action 
is subject to the SBREFA because it has an annual effect on the economy 
of $100 million or more. The Department anticipates this final rule 
would have neither significant employment nor small business impacts; 
nor cause major price increases for consumers, businesses, or 
governments; nor significantly degrade competition, employment, 
investment, productivity, innovation, or the ability of U.S. businesses 
to compete against foreign businesses. This rule seeks to ensure safe 
and responsible domestic energy production as the nation transitions to 
a clean energy future. No specific comments on the SBREFA were received 
during the public comment period.

D. Unfunded Mandates Reform Act (UMRA)

    The Unfunded Mandates Reform Act (UMRA), 2 U.S.C. 1531-1538, 
requires the Department, unless otherwise prohibited by law, to assess 
the effects of their regulatory actions on State, local, and Tribal 
governments, and the private sector. Section 202 of UMRA generally 
requires the Department to prepare a written statement, including a 
cost-benefit analysis, for each proposed and final rule with ``Federal 
mandates'' that may result in expenditures by State, local, and Tribal 
governments, in the aggregate, or to the private sector, of $100 
million or more in any one year, adjusted for inflation. This action 
does not contain an unfunded mandate of $100 million or more as 
described in UMRA, 2 U.S.C. 1531-1538, and does not significantly or 
uniquely affect small governments. The action implements mandate(s) 
specifically and explicitly set forth in OCSLA without the exercise of 
any policy discretion by BOEM and BSEE. No comments on the UMRA were 
received during the public comment period.

E. Executive Order 12630: Governmental Actions and Interference With 
Constitutionally Protected Property Rights

    Executive Order 12630, Governmental Actions and Interference with 
Constitutionally Protected Property Rights, ensures that government 
actions affecting the use of private property are undertaken on a well-
reasoned basis with due regard for the potential financial impacts 
imposed on the government. This action does not affect a taking of 
private property or otherwise have taking implications under E.O. 
12630. To the extent OCS renewable energy lessees and grantees possess 
private property rights under the terms of BOEM leases, this final rule 
is not expected to reduce the value of those rights. A takings 
implication assessment is not required. No comments were received on 
E.O. 12630 during the public comment period.

F. Executive Order 13132: Federalism

    Regulatory actions that have substantial direct effects on the 
States, on the relationship between the National Government and the 
States, or on the distribution of power and responsibilities among the 
various levels of government are subject to E.O. 13132. Under the 
criteria in section 1 of E.O. 13132, this final rule does not have 
sufficient federalism implications to warrant the preparation of a 
federalism summary impact statement. It will not have substantial 
direct effects on the states, on the relationship between the national 
government and the states, or on the distribution of power and 
responsibilities among the various levels of government. No comments 
were received on E.O. 13132 during the public comment period.

G. Executive Order 12988: Civil Justice Reform

    This rule complies with the requirements of E.O. 12988. 
Specifically, this rule:
    (1) Meets the criteria of section 3(a) requiring that all 
regulations must be reviewed to eliminate errors and ambiguity and be 
written to minimize litigation; and
    (2) Meets the criteria of section 3(b)(2) requiring that all 
regulations must be written in clear language and contain clear legal 
standards.
    No comments were received on E.O. 12988 during the public comment 
period.

H. Executive Order 13175: Consultation and Coordination With Indian 
Tribal Governments

    Executive Order 13175 defines ``polices that have Tribal 
implications'' as ``regulations, legislative comments or proposed 
legislation, and other policy statements or actions that have 
substantial direct effects on one or more Indian tribes, on the 
relationship between the Federal government and Indian tribes, or on 
the distribution of power and responsibilities between the Federal 
government and Indian tribes.'' The Department strives to strengthen 
its government-to-government relationships with Tribal Nations through 
a commitment to consultation with those Tribes, recognition of their 
right to self-governance and Tribal sovereignty, and honoring BOEM's 
trust responsibilities for Tribal Nations. The Department's 
consultation policy for Tribal Nations, is described in Departmental 
Manual part 512 chapter 4.\32\
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    \32\ Available at https://www.doi.gov/sites/doi.gov/files/elips/documents/512-dm-4_2.pdf.
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    DOI's procedures for consultation with Tribal Nations also provide 
that: ``Bureaus/Offices must invite Indian Tribes early in the planning 
process to consult whenever a Departmental plan or action with Tribal 
Implications arises. Bureaus/Offices should operate under the 
assumption that all actions with land or resource use or resource 
impacts may have Tribal implications and should extend consultation 
invitations accordingly.'' 512 DM 5.4.A. (November 30, 2022).
    Additionally, the Department is also respectful of its 
responsibilities for consultation with Alaska Native Claims Settlement 
Act (ANCSA) Corporations. The Department's consultation policy \33\ 
defines a Departmental Action with ANCSA Corporation Implications and 
the Department's consultation procedures for ANCSA Corporations also 
provide: ``Bureaus and Offices should operate under the assumption that 
all actions with land or resource use or resource impacts may have 
ANCSA Corporation implications and should extend consultation 
invitations accordingly. When ANCSA Corporations indicate that there is 
substantial and direct effect of the Departmental Action with ANCSA 
Corporation Implications, the Department must engage in consultation.'' 
512 DM 7.4.A. (November 30, 2022).
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    \33\ Available at https://www.doi.gov/sites/doi.gov/files/elips/documents/512-dm-6.pdf.
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    The Department has evaluated this final rule under its consultation 
policy and under the criteria in E.O. 13175. The final rule may have 
Tribal implications. Accordingly, we have consulted with affected 
Tribes on a government-to-government basis as discussed in section What 
Tribal engagement activities were conducted of Section IV of this 
preamble, and we have fully considered Tribal views in the final rule. 
During the consultation process, the Tribes reiterated their comments 
submitted on the proposed rule through https://www.regulations.gov. 
Section III of this preamble describes how the final rule addresses 
comments and concerns submitted by the Tribes. No ANCSA Corporations 
requested consultation. A

[[Page 42708]]

summary of the consultations and staff-level meetings held on this 
rulemaking, as well as notes from those meetings are available in the 
docket (Docket No. BOEM-2023-0005). BOEM and BSEE can consult at any 
time with federally recognized Tribes as sovereign nations and with 
ANCSA Corporations, including after the rule is promulgated.

I. Paperwork Reduction Act (PRA)

    The Paperwork Reduction Act of 1995, 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 (44 
U.S.C. 3502(3); 5 CFR 1320.3(c) and (k)).
    A proposed rule, soliciting comments on this collection of 
information for 30 days, was published on January 30, 2023 (88 FR 
5968). Subsequent to the publication of the proposed rule, the 
Department published a final rule titled ``Reorganization of Title 30-
Renewable Energy and Alternate Uses of Existing Facilities on the Outer 
Continental Shelf'' in the Federal Register on January 31, 2023 (88 FR 
6376), which relocated or reproduced certain of the regulatory 
provisions addressed in the proposed rule under 30 CFR part 585 to the 
newly created 30 CFR part 285. The DOI published a correction 
notification in the Federal Register on January 3, 2024 (89 FR 309), to 
provide the public an opportunity to comment on collections of 
information that were transferred from BOEM to BSEE on January 31, 
2023, under the rule titled ``Reorganization of Title 30-Renewable 
Energy and Alternate Uses of Existing Facilities on the Outer 
Continental Shelf.'' Therefore, this final rule contains existing and 
new ICs for BSEE's regulations at 30 CFR part 285 and BOEM's 
regulations at 30 CFR part 585 that have been submitted to the OMB for 
review and approval under the Paperwork Reduction Act. OMB has reviewed 
and approved BSEE's ICs requirements in this rule and assigned OMB 
Control Number 1014-0034, which expires April 30, 2026. OMB has 
reviewed BOEM's ICs requirements in this rule and assigned OMB Control 
Number 1010-0195. With this final rule, BOEM will transfer the hour 
burden from this collection to OMB Control Number 1010-0176, which 
expires January 31, 2026, then discontinue OMB Control Number 1010-
0195. The IC aspects affecting each Bureau are discussed separately 
below.
BSEE Information Collection--30 CFR Part 285
    BSEE published a correcting amendment January 3, 2024 (89 FR 309), 
pertaining to the Department's proposed rule, Renewable Energy 
Modernization Rule, which was published in the Federal Register on 
January 30, 2023 (88 FR 5968). Subsequent to publication of the 
proposed rule, the Department published the rule titled Reorganization 
of Title 30--Renewable Energy and Alternate Uses of Existing Facilities 
on the Outer Continental Shelf in the Federal Register on January 31, 
2023 (88 FR 6376), which relocated or reproduced certain of the 
regulatory provisions addressed in the proposed rule under 30 CFR part 
585 in the newly created 30 CFR part 285. The correcting amendment 
solicited comments on BSEE's collection of information pertaining to 
this rulemaking. The public comment period ended on March 4, 2024. No 
comments were received. See https://www.govinfo.gov/content/pkg/FR-2023-08-14/pdf/2023-17421.pdf.
    As discussed in the section-by-section analysis above, comments 
received on the proposed rule will make changes in this final rule by 
adding Sec.  285.116, Request for Information; furthermore, there are 
no changes in burden due to 5 CFR 1320.3(h)(4).
    Final Sec.  285.637(c) requires operators to notify BSEE within 10 
business days after commencing commercial operations. BSEE will add +1-
hour burden to Sec.  285.637(c).
    Final Sec.  285.700(b) will require operators to explain to BSEE 
how all integrated asset packages will function together effectively. 
BSEE will add +10-hour burdens to Sec.  285.700(b).
    Final Sec.  285.810 will clarify that a SMS is required to be 
submitted to BSEE to conduct activities pursuant to a lease, from met 
buoy placement and site assessment work through decommissioning. While 
a description of the SMS is required to be submitted for review by BSEE 
with a COP, and for review of an SAP or GAP if the facilities being 
installed are deemed by the Department to be complex or significant, 
this addition will make it clear that a structured approach to safety 
is both expected and required for all operations. BSEE will add +60 
annual hour burdens to Sec.  285.810.
    Final Sec.  285.812(b)(1) and (2) will add new reporting 
requirements. Proposed Sec.  285.812(b)(1) will require an annual 
summary of safety performance data covering the previous calendar year 
during which site assessment, construction, operations, or 
decommissioning activities occurred by submitting Form BSEE-0187, 
Performance Measures Data--Renewable Energy. This form will include 
company identification and number of injuries, illnesses, and hours 
worked by company employees and contractors. This information will be 
used to develop incident rates that will help assess workplace safety 
and environmental compliance across the OCS renewable energy industry. 
BSEE will add +820 annual burden hours to Sec.  285.812(b)(1).
    Final Sec.  285.812(b)(2) will require a summary of the most recent 
SMS audit, corrective actions implemented or pending because of that 
audit, and an updated SMS description highlighting changes made since 
the last report. This report will be due every 3 years or upon BSEE's 
request. BSEE will add +5 annual burden hours to Sec.  285.812(b)(2).
    For final Sec.  285.830(d), BSEE will remove -2 burden hours since 
the burdens for reporting oil spills falls under OMB Control Number 
1014-0007.
    Abstract: BSEE will use the information to oversee facility design, 
fabrication, installation, and safety management systems; ensure the 
safety of operations, including inspection programs and incident 
reporting and investigations; enforce compliance with all applicable 
safety, environmental, and other laws and regulations through 
enforcement actions (such as noncompliance notices, cessation orders, 
and certain lease suspensions); and oversee decommissioning activities. 
These responsibilities include enforcement provisions under the 
existing part 285, subpart D, various information submittal 
requirements under subpart F, as well as provisions governing 
activities conducted under an approved plan, including the design, 
construction, operation, and decommissioning of facilities under 
subparts G, H, and I.
    Title of Collection: 30 CFR part 285, Renewable Energy and 
Alternate Uses of Existing Facilities on the Outer Continental Shelf.
    OMB Control Number: 1014-0034.
    Forms: Forms BSEE-1835, Notice(s) of Noncompliance (NONCs) and 
BSEE-0187, Performance Measures Data--Renewable Energy.
    Type of Review: Revision of a currently approved collection.
    Respondents/Affected Public: Primary respondents comprise Federal 
OCS companies that submit unsolicited proposals or responses to Federal 
Register notices; or are lessees, designated operators, and Right-of-
Way or Right-of-Use and Easement grantees.

[[Page 42709]]

Other potential respondents are companies or state and local 
governments that submit information or comments relative to alternative 
energy-related uses of the OCS; certified verification agents; and 
surety or third-party guarantors.
    Total Estimated Number of Annual Respondents: Currently there are 
approximately 47 lessees in the OCS. Not all the potential respondents 
will submit information in any given year, and some may submit multiple 
times.
    Total Estimated Number of Annual Responses: 16.
    Estimated Completion Time per Response: Varies from 30 minutes to 
6,000 hours, depending on activity.
    Total Estimated Number of Annual Burden Hours: 894.
    Respondent's Obligation: Responses are mandatory and are required 
to obtain or retain a benefit.
    Frequency of Collection: Generally, submissions are on occasion or 
annual.
    Total Estimated Annual Nonhour Burden Cost: N/A.
    Below is a burden table of the final rule changes BSEE will 
require. New burden changes are shown in BOLD and revised burdens are 
shown in italic:
BILLING CODE 4340-98-P
[GRAPHIC] [TIFF OMITTED] TR15MY24.000

BILLING CODE 4340-98-C
    As part of our continuing effort to reduce paperwork and respondent 
burdens, we invite the public and other Federal agencies to comment on 
any aspect of this information collection, including:
    (1) Whether or not the collection of information is necessary for 
the proper performance of the functions of the agency, including 
whether or not the information will have practical utility;

[[Page 42710]]

    (2) The accuracy of our estimate of the burden for this collection 
of information, including the validity of the methodology and 
assumptions used;
    (3) Ways to enhance the quality, utility, and clarity of the 
information to be collected; and
    (4) Ways to minimize the burden of the collection of information on 
those who are to respond, including through the use of appropriate 
automated, electronic, mechanical, or other technological collection 
techniques or other forms of information technology, e.g., permitting 
electronic submission of response.
    Written comments and suggestions on the information collection 
requirements should be submitted by the date specified above in DATES 
to https://www.reginfo.gov/public/do/PRAMain. Find this particular 
information collection by selecting ``Currently under Review--Open for 
Public Comments'' or by using the search function. Please provide a 
copy of your comments to Nikki Mason, 45600 Woodland Road, Sterling, VA 
20166; or by email to [email protected]. Please reference OMB Control 
Number 1014-0034 in the subject line of your comments.
BOEM Information Collection--30 CFR Parts 585 and 586
    With this final rulemaking, BOEM revises the collections of 
information in the proposed rule. The regulations in this final rule 
revise existing requirements and establish new requirements in 30 CFR 
part 585. OMB reviewed BOEM's information collections in this rule and 
assigned the temporary OMB Control Number 1010-0195. When the final 
rule is effective, BOEM will transfer the hour burden from this 
collection to revise OMB Control Number 1010-0176, and discontinue OMB 
Control Number 1010-0195. OMB Control Number 1010-0176 is the control 
number that OMB has assigned to the collections of information under 30 
CFR parts 585 and 586, Renewable Energy on the Outer Continental Shelf.
    With the publication of the final rule titled Reorganization of 
Title 30--Renewable Energy and Alternate Uses of Existing Facilities on 
the Outer Continental Shelf in the Federal Register on January 31, 2023 
(88 FR 6376), certain regulatory provisions were transferred from 
BOEM's 30 CFR part 585 regulations to BSEE's newly created 30 CFR part 
285 regulations. Certain collections of information pertaining to BSEE 
were also transferred. The collections of information that moved to 
BSEE are noted above in BSEE Information Collection--30 CFR part 285.
    This final rule decreases BOEM's annual burden hours overall by 
290; the non-hour costs remain unchanged. As discussed in the section-
by-section analysis above and in the supporting statement available at 
https://www.reginfo.gov, this rule revises the following BOEM paperwork 
burdens:
BILLING CODE 4340-98-P

[[Page 42711]]

[GRAPHIC] [TIFF OMITTED] TR15MY24.001

BILLING CODE 4340-98-C
    Subpart B. This final rule adds a new subpart B for the renewable 
energy leasing schedule published by the Secretary of the Interior. 
BOEM estimates no burdens for this subpart, but the lettering for the 
subsequent subparts is revised accordingly.
    Subpart C. Section 585.216(c) relates to eligibility for bidding 
credits as set forth in the FSN before the lease auction takes place. 
Bidders seeking a bidding credit in the auction must establish that 
they are eligible for each bidding credit that they seek. Bidders may 
participate in the auction without applying for or receiving a bidding 
credit, at their discretion. BOEM is keeping the annual burden hours 
the same as in the 2023 approved OMB Control Number 1010-0176 (2023 
approval) but attributes the hours to the requirements of the bidding 
credit eligibility criteria.
    Subpart E. Section 585.413 aligns the regulations with the existing 
practice allowing for lease and grant consolidation. BOEM adds 10 
annual burden hours to the 2023 approval attributable to Sec.  585.413 
to account for submission of applications to consolidate all or part of 
two or more adjacent leases or grants by the same lessee or grantee 
into one new lease or grant, and to negotiate with BOEM on 
inconsistencies in terms and conditions.
    Subpart G. Section 585.600(a) significantly revises the requirement 
for SAPs. Under this final rule, a SAP is required only when site 
assessment activities involve an engineered foundation. BOEM will not 
require a SAP for floating site assessment

[[Page 42712]]

facilities, such as met buoys. BOEM also has the discretion to waive 
certain information requirements in a proposed plan, which could add 
flexibility to the permit application process. BOEM removes 240 annual 
burden hours from Sec.  585.600(a).
    Section 585.615(b) relates to other reports or notices that must be 
submitted periodically under an approved SAP. With the narrowing of the 
SAP requirement to site assessment activities involving an engineered 
foundation, BOEM estimates fewer reports or notices filed under this 
section. BOEM removes 60 annual burden hours from Sec.  585.615(b).
    This final rule allows the deferral of detailed geotechnical survey 
reporting from COP submission under the existing Sec.  585.626(b) to 
FDR submission under 30 CFR 285.585.701(a). This change does not 
increase annual burden hours.
    Title of Collection: Renewable Energy Modernization (Final 
Rulemaking).
    OMB Control Number: 1010-0195.
    Form Numbers: None.
    Type of Review: New.
    Respondents/Affected Public: Respondents primarily are private 
sector companies interested in developing or operating OCS renewable 
energy leases and grants; affected State, local, and Tribal 
governments; and other companies that submit information regarding OCS 
renewable energy projects.
    Total Estimated Number of Annual Responses: Decrease of 2 annual 
responses.
    Total Estimated Number of Annual Burden Hours: Decrease of 290 
hours.
    Due to a ROCIS system limitation, BOEM is unable to show a negative 
number for responses and hours in ROCIS; therefore, the table for 1010-
0195 found on https://www.reginfo.gov shows a place marker of one 
response and one hour.
    Respondent's Obligations: Responses to ICs under this part are 
mandatory to obtain, or retain, an OCS renewable energy lease or grant.
    Frequency of Collection: The frequency of collection varies 
depending upon BOEM's decisions to issue OCS leases or grants for 
renewable energy development, a company's decision to seek a lease or 
grant, and the manner in which the lessee or grantee elects to develop 
its lease or grant.
    Total Estimated Annual Non-Hour Burden Cost: No non-hour costs.
    Once the rule becomes effective and OMB approves the IC request 
1010-0195, BOEM plans to revise the existing OMB Control Number 1010-
0176 for the affected subparts discussed above and adjust the annual 
burden hours accordingly. For OMB Control Number 1010-0176, the 
existing annual burden hours are 9,876 and responses are 200. The final 
rule requirement changes reduce the annual burden hours to 9,586 annual 
burden hours and 198 responses. The ICs related to 30 CFR part 585 do 
not include questions of a sensitive nature. BOEM will continue to 
protect proprietary information according to FOIA and the Department's 
implementing regulations, which address disclosure of information to 
the public.\34\
---------------------------------------------------------------------------

    \34\ See 43 CFR part 2 and 30 CFR 585.114.
---------------------------------------------------------------------------

    In addition, the PRA requires agencies to estimate the total annual 
reporting and recordkeeping non-hour cost burden resulting from the 
collection of information. BOEM solicits your comments regarding non-
hour cost burdens arising from this rule. For reporting and 
recordkeeping only, your response should split the cost estimate into 
two components: (1) total capital and startup cost component, and (2) 
annual operation, maintenance, and disclosure cost component, to 
provide the information. You should describe the methods you use to 
estimate your cost components, including system and technology 
acquisition, expected useful life of capital equipment, discount 
rate(s), and the period over which you incur costs. Generally, your 
estimates should not include equipment or services purchased: (1) 
before October 1, 1995; (2) to comply with requirements not associated 
with the IC arising from this rule; (3) for reasons other than to 
provide information or to keep records for the U.S. Government; or (4) 
as part of customary and usual business or private practices.
    As part of BOEM's continuing effort to reduce paperwork and 
respondent burdens, BOEM invites the public and other Federal agencies 
to comment on any aspect of this IC, including:
    (1) Is the IC necessary or useful for BOEM to properly perform its 
functions?
    (2) Are the estimated annual burden hour increases and decreases 
resulting from this final rule reasonable?
    (3) Is the estimated annual non-hour cost burden resulting from 
this IC reasonable?
    (4) Do you have any suggestions that would enhance the quality, 
clarity, or usefulness of the information to be collected?
    (5) Is there a way to minimize the IC burden on those who must 
respond, such as by using appropriate automated digital, electronic, 
mechanical, or other forms of information technology?
    Send your comments and suggestions on this IC by the date indicated 
in the DATES section to the Desk Officer for the Department at OMB-OIRA 
at (202) 395-5806 (fax) or via the https://www.reginfo.gov portal 
(online). You may view the IC request(s) at https://www.reginfo.gov/public/do/PRAMain. Due to a ROCIS system limitation, BOEM is unable to 
show a negative number for responses and hours in ROCIS; therefore, the 
table for 1010-0195 found on https://www.reginfo.gov shows a place 
marker of one response and one hour. Please provide a copy of your 
comments to the BOEM IC Clearance Officer (see the ADDRESSES section). 
You may contact Anna Atkinson, BOEM IC Clearance Officer at (703) 787-
1025 with any questions. Please reference Renewable Energy 
Modernization Rule (1010-0195) in your comments.

J. National Environmental Policy Act (NEPA)

    This rule does not constitute a major Federal action significantly 
affecting the quality of the human environment. A detailed 
environmental analysis under NEPA is not required because this final 
rule is covered by a categorical exclusion (see 43 CFR 46.205). This 
final rule meets the criteria set forth at 43 CFR 46.210(i) for a 
Departmental categorical exclusion in that this action is ``of an 
administrative, financial, legal, technical, or procedural nature.'' 
BOEM has also determined that the final rule does not involve any of 
the extraordinary circumstances listed in 43 CFR 46.215 that would 
require further analysis under NEPA.
    Multiple commenters asserted that BOEM should conduct a NEPA review 
for the final rule. BOEM disagrees with this assertion as this 
rulemaking does not authorize any activities. Nothing in this 
rulemaking reduces or eliminates BOEM's environmental review of 
renewable energy activities, including site characterization 
(geotechnical and geophysical surveys, biological surveys) and site 
assessment activities (deployment of met towers and buoys). This review 
is completed during BOEM's development of an EA pursuant to NEPA which 
typically concludes with the release of a Final EA and a Finding of No 
Significant Impact between publication of a PSN and a FSN (i.e., prior 
to issuing a lease). BOEM's EAs analyze environmental impacts of 
activities expected to take place following lease issuance, including 
site characterization and site assessment activities. BOEM also 
conducts environmental review of proposed development activities 
through a NEPA

[[Page 42713]]

analysis of the COP. BOEM identifies and avoids or reduces potential 
environmental impacts throughout the process of offshore wind planning, 
including using spatial data and stakeholder input to identify 
appropriate areas for potential wind energy development. This process 
will not change as a result of these regulations. In addition, every 
BOEM environmental analysis pursuant to NEPA considers the potential 
cumulative impacts of wind energy development prior to approving 
development activities.

K. Data Quality Act

    In promulgating this rule, the Department did not conduct or use a 
study, experiment, or survey requiring peer review under the Data 
Quality Act (Pub. L. 106-554, app. C, sec. 515, 114 Stat. 2763, 2763A-
153-154). 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 website at: https://www.doi.gov/ocio/policy-mgmt-support/information-and-records-management/iq. No comments were received on the 
Data Quality Act during the public comment period.

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

    Under E.O. 13211, the Department is required to prepare and submit 
to OMB a ``Statement of Energy Effects'' for ``significant energy 
actions.'' This should include a detailed statement of any adverse 
effects on energy supply, distribution, or use (including a shortfall 
in supply, price increases, and increased use of foreign supplies) 
expected to result from the action and a discussion of reasonable 
alternatives and their effects. This action is not a ``significant 
energy action'' because it is not likely to have a significant adverse 
effect on the supply, distribution or use of energy. This final rule 
does not add new regulatory compliance requirements that would result 
in significant adverse energy effects, rather the regulatory changes 
will help reduce compliance burdens on the OCS renewable energy 
industry that may hinder the continued development or use of 
domestically produced energy resources. Reduced regulatory burdens do 
not adversely affect productivity, competition, or prices within the 
energy sector. For these reasons, this final rule is not a significant 
energy action under the definition in E.O. 13211, and therefore, a 
Statement of Energy Effects is not required. No comments were received 
on E.O. 13211 during the public comment period.

M. Congressional Review Act (CRA)

    This action is subject to the CRA, and the Department will submit a 
rule report to each chamber of Congress and to the Comptroller General 
of the United States. This action meets the criteria in 5 U.S.C. 
804(2).

N. Severability

    If a court holds any provisions of this final rule or their 
applicability to any persons or circumstances invalid, the remainder of 
the provisions and their applicability to other people or circumstances 
will not be affected.

List of Subjects

30 CFR Part 285

    Continental shelf, Energy, Environmental protection, Historic 
preservation, Marine resources, Marine safety, Natural resources, Ocean 
resources, Offshore energy, Offshore structures, Outer continental 
shelf, Renewable energy, Reporting and recordkeeping requirements, 
Safety, Wind energy.

30 CFR Part 585

    Administrative practice and procedure, Assessment plans, Coastal 
zone, Compliance, Electric power, Energy, Environmental protection, 
Government leases, Intergovernmental relations, Marine resources, 
Natural resources, Ocean resources, Offshore energy, Offshore 
structures, Outer continental shelf, Payments, Planning, Power 
resources, Renewable energy, Reporting and recordkeeping requirements, 
Revenue sharing, Right-of-way, Right-of-use-and-easement, Wind energy.

Delegation of Signing Authority

    This action by the Deputy Assistant Secretary is taken herein 
pursuant to an existing delegation of authority.

Steven H. Feldgus,
Principal Deputy Assistant Secretary, Land and Minerals Management.

    For the reasons stated in the preamble, BSEE amends 30 CFR part 285 
and BOEM amends 30 CFR part 585 as follows:

PART 285--RENEWABLE ENERGY AND ALTERNATE USES OF EXISTING 
FACILITIES ON THE OUTER CONTINENTAL SHELF

0
1. The authority citation for part 285 continues to read as follows:

    Authority: 43 U.S.C. 1331 et seq.

Subpart A--General Provisions

0
2. Amend Sec.  285.103 by revising paragraph (a) to read as follows:


Sec.  285.103  When may BSEE prescribe or approve departures from the 
regulations in this part?

    (a) BSEE may prescribe or approve departures from the provisions of 
this part when departures are necessary because the applicable 
provision(s) as applied to a specific circumstance:
    (1) Are impractical or unduly burdensome and the departure is 
necessary to achieve the intended objectives of the renewable energy 
program;
    (2) Fail to conserve the natural resources of the OCS;
    (3) Fail to protect life (including human and wildlife), property, 
or the marine, coastal, or human environment; or
    (4) Fail to protect sites, structures, or objects of historical or 
archaeological significance.
* * * * *

0
3. Amend Sec.  285.105 by revising paragraph (d) to read as follows:


Sec.  285.105  What are my responsibilities under this part?

* * * * *
    (d) Comply with all applicable laws and regulations, the terms of 
your lease or grant under 30 CFR part 585 or 586, reports, notices, and 
approved plans prepared under this part, 30 CFR part 585 or 586, and 
any conditions imposed by BOEM or BSEE through its review of any of 
these reports, notices, and approved plans, as provided in this part or 
in 30 CFR part 585 or 586;
* * * * *

0
4. Revise Sec.  285.110 to read as follows:


Sec.  285.110  How do I submit applications, reports, or notices 
required by this part?

    Unless otherwise stated, you must submit one electronic copy of all 
plans, applications, reports, or notices required by this part to BSEE. 
BSEE will inform you if it requires paper copies of specific documents. 
Unless stated otherwise, documents should be submitted to the relevant 
contacts listed on the BSEE website.

0
5. Amend Sec.  285.112 by:
0
a. Revising the definitions of ``Commercial activities'' and 
``Commercial operations'';
0
b. Adding in alphabetical order the definition for ``Critical Safety 
Systems and Equipment'';
0
c. Revising the definition of ``Decommissioning'';

[[Page 42714]]

0
d. Adding in alphabetical order the definitions of ``Fabrication'' and 
``Project Design Envelope''; and
0
e. Revising the definition of ``Site assessment activities''.
    The additions and revisions read as follows:


Sec.  285.112  Definitions.

* * * * *
    Commercial activities means, under renewable energy leases and 
grants, all activities associated with the generation, storage, or 
transmission of electricity or other energy product from a renewable 
energy project on the OCS, and for which such electricity or other 
energy product is intended for distribution, sale, or other commercial 
use, except for electricity or other energy product distributed or sold 
pursuant to technology-testing activities on a limited lease. This term 
also includes activities associated with all stages of development, 
including initial site characterization and assessment, facility 
construction, and project decommissioning.
* * * * *
    Commercial operations means the generation of electricity or other 
energy product for commercial use, sale, transmission, or distribution 
from a commercial lease.
    Critical Safety Systems and Equipment means safety systems and 
equipment designed to prevent or ameliorate fires, spillages, or other 
major accidents that could result in harm to health, safety, or the 
environment in the area of your facilities.
    Decommissioning means removing BOEM and BSEE approved facilities 
and returning the site of the lease or grant to a condition that meets 
the requirements under subpart I of this part.
* * * * *
    Fabrication means the cutting, fitting, welding, or other assembly 
of project elements.
* * * * *
    Project Design Envelope (PDE) means a reasonable range of design 
parameters proposed in a lessee's plan for components of the project, 
such as type, dimensions, and number of wind turbine generators; 
foundation type; location of the export cable route; location of an 
onshore substation; location of the grid connection point; and 
construction methods and timing.
* * * * *
    Site assessment activities means those initial activities conducted 
to assess an area on the OCS, such as resource assessment surveys 
(e.g., meteorological and oceanographic) or technology testing, 
involving the installation of bottom-founded facilities.
* * * * *

0
6. Amend Sec.  285.113 by revising paragraph (b)(1) to read as follows:


Sec.  285.113  How will data and information obtained by BSEE under 
this part be disclosed to the public?

* * * * *
    (b) * * *

------------------------------------------------------------------------
                                     Then BSEE will review data and
     If you have a . . .           information for possible release:
------------------------------------------------------------------------
(1) Commercial lease.........  At the earlier of: (i) 3 years after the
                                commencement of commercial operations;
                                or (ii) 3 years after the lease
                                terminates.
 
                              * * * * * * *
------------------------------------------------------------------------

* * * * *

0
7. Revise Sec.  285.116 to read as follows:


Sec.  285.116  Requests for information on the state of the offshore 
renewable energy industry.

    BSEE may publish a request for information (RFI) in the Federal 
Register to solicit information from industry, State and local 
agencies, federally recognized Tribes, and other interested entities 
for evaluating the offshore renewable energy industry, including the 
identification of potential challenges or obstacles to its continued 
development. An RFI may relate to the identification of environmental, 
technical, regulatory, or economic matters that promote or detract from 
continued development of renewable energy technologies on the OCS. BSEE 
may use the information received to refine its renewable energy 
program, including to facilitate OCS renewable energy development in a 
safe and environmentally responsible manner and to ensure a fair return 
to the United States for use of the OCS.

0
8. Add Sec.  285.117 to read as follows:


Sec.  285.117  Severability.

    If a court holds any provisions of this subpart or their 
applicability to any persons or circumstances invalid, the remainder of 
the provisions and their applicability to any persons or circumstances 
will not be affected.

0
9. Revise Sec.  285.118 to read as follows:


Sec.  285.118  What are my appeal rights?

    (a) Any party adversely affected by a final decision issued by BSEE 
under this part may appeal that decision to the Interior Board of Land 
Appeals (IBLA), under 30 CFR part 290 and 43 CFR part 4, subpart E.
    (b) Any final decision will remain in full force and effect during 
the pendency of an appeal unless a stay is granted pursuant to 43 CFR 
part 4.

Subpart D--Lease and Grant Administration

0
10. Amend Sec.  285.400 by revising paragraph (f) to read as follows:


Sec.  285.400  What happens if I fail to comply with this part?

* * * * *
    (f) BSEE may assess civil penalties, as authorized by section 24 of 
the OCS Lands Act and as determined under the procedures set forth in 
30 CFR part 250, subpart N, if you fail to comply with any provision of 
this part, or any term of a lease, grant, or order issued under the 
authority of this part:
    (1) After notice of such failure and expiration of any reasonable 
period allowed for corrective action; or
    (2) BSEE determines that the failure constitutes, or constituted, a 
threat of serious, irreparable, or immediate harm or damage to life 
(including fish and other aquatic life), property, or the marine, 
coastal, or human environment.
* * * * *

0
11. Amend Sec.  285.415 by revising paragraph (b) to read as follows:


Sec.  285.415  What is a lease or grant suspension?

* * * * *
    (b) A suspension extends the expiration date for the relevant 
period of your lease or grant for the length of time the suspension is 
in effect.
* * * * *

0
12. Amend Sec.  285.417 by revising paragraph (b)(2) to read as 
follows:


Sec.  285.417  When may BSEE order a suspension?

* * * * *
    (b) * * *

[[Page 42715]]

    (2) You must furnish an electronic copy of the study and results to 
BSEE pursuant to Sec.  285.110;
* * * * *

0
13. Revise Sec.  285.420 to read as follows:


Sec.  285.420  What effect does a suspension order have on my payments?

    If BSEE orders a suspension, as provided in Sec.  285.417, BOEM may 
waive or defer your payment obligations during the suspension. BOEM's 
decision to waive or defer payments will depend on the reasons for the 
suspension, including your responsibility for the circumstances 
necessitating a suspension.

Subpart F--Information Requirements

0
14. Revise Sec.  285.602 to read as follows:


Sec.  285.602  What records must I maintain?

    Until BOEM releases your financial assurance under 30 CFR 585.534, 
you must maintain and provide to BSEE, upon request, all data and 
information related to compliance with the required terms and 
conditions of your lease, grant, reports submitted under this part and 
approved plans.

0
15. Amend Sec.  285.614 by revising paragraph (b) to read as follows:


Sec.  285.614  When may I begin conducting activities under my approved 
SAP?

* * * * *
    (b) If you are installing a facility or a combination of facilities 
deemed by BOEM to be complex or significant, as provided in 30 CFR 
585.613(a)(1), you must comply with the requirements of subpart G of 
this part and submit the Safety Management System (SMS) description 
required by Sec.  285.810 before construction may begin.

0
16. Revise Sec.  285.637 to read as follows:


Sec.  285.637  When may I commence commercial operations on my 
commercial lease?

    (a) If you are conducting activities on your lease that do not 
require a FERC license (i.e., wind power projects), then you may 
commence commercial operations after:
    (1) You submit information consistent with Sec.  285.702(c) and (d) 
for facilities installed prior to commencing commercial operations;
    (2) Your CVA submits the project verification report, as described 
in Sec.  285.708(a)(5), including information required by Sec.  
285.708(b)(1), or interim report(s), as described in Sec.  285.712(a) 
for facilities installed prior to commencing commercial operations;
    (3) Your CVA submits the Critical Safety Systems and Equipment 
commissioning records, as described in Sec.  285.708(a)(6) or interim 
report(s), as described in Sec.  285.712(a), for facilities installed 
prior to commencing commercial operations; and
    (4) BSEE has not notified you of any objections to the submittals 
in paragraphs (a)(1) and (3) of this section within the timeframes in 
Sec. Sec.  285.700(d) and 285.712(a), as applicable. You may continue 
commercial operations while BSEE reviews your submittals.
    (b) To continue commercial operations as additional facilities 
complete commissioning, you must submit information in paragraphs 
(a)(1) and (3) of this section for facilities installed after 
commercial operations have commenced.
    (c) You must notify BSEE within 10 business days after you commence 
commercial operations.

0
17. Amend Sec.  285.638 by revising the first sentence of paragraph (a) 
to read as follows:


Sec.  285.638  What must I do upon completion of my commercial 
operations as approved in my COP or FERC license?

    (a) Upon completion of your approved activities under your COP, you 
must decommission your project as set forth in subpart I of this part. 
* * *
* * * * *

Subpart G--Facility Design, Fabrication, and Installation

0
18. Revise Sec.  285.700 to read as follows:


Sec.  285.700   What reports must I submit to BSEE before installing 
facilities described in my approved SAP, COP, or GAP?

    (a) You must submit the following reports to BSEE before installing 
facilities described in your approved COP (30 CFR 585.632(a)) and, when 
required by 30 CFR part 585, in your approved SAP (30 CFR 585.614(b)) 
or GAP (30 CFR 585.651):
    (1) A Facility Design Report (FDR); and
    (2) A Fabrication and Installation Report (FIR).
    (b) You may submit separate FDRs and FIRs for integrated asset 
packages unless otherwise agreed to by BSEE (e.g., wind turbine 
generator (WTG), offshore substation/electrical service platform, array 
cables, export cables, and seabed preparation). If you submit separate 
FDRs and FIRs by integrated asset packages, you must:
    (1) Ensure FDR(s) and FIR(s) for integrated asset package(s) are 
complete (e.g., the WTG package includes the RNA, blades, tower, 
foundation, and transition piece, if applicable);
    (2) Explain to BSEE how all FDR(s) and FIR(s) for integrated asset 
packages will function together effectively in an integrated manner in 
accordance with your project design; and
    (3) Demonstrate that such integration has been verified by your 
CVA.
    (c) You may submit your FDRs and FIRs before or after SAP, COP, or 
GAP approval.
    (d) Subject to the requirements in paragraph (b) of this section, 
you may commence fabrication and installation of the facilities on the 
OCS as described in each report:
    (1) If BSEE deems your report submitted before SAP, COP, or GAP 
approval and notifies you of its non-objection to the FDR and FIR or 
does not respond with objections within 60 business days of SAP, COP, 
or GAP approval; or
    (2) If BSEE deems your report submitted after SAP, COP, or GAP 
approval and notifies you of its non-objection to the FDR and FIR or 
does not respond with objections within 60 business days of the report 
being deemed submitted.
    (e) You may commence procurement of discrete parts of the project 
that are commercially available in standardized form and type-certified 
components, or fabrication activities that do not take place on the OCS 
(e.g., manufacturing), prior to the submittal of the reports required 
under paragraph (a) of this section or any plans required under 30 CFR 
parts 585 and 586. The procurement and fabrication of facility 
components allowed under this section are subject to verification and 
certification by your CVA, and BSEE may object to the installation of 
said components on the OCS if it considers that the components or their 
fabrication are inconsistent with accepted industry or engineering 
standards, the approved SAP, COP, or GAP, the FDR or FIR, or BSEE's 
regulations.
    (f) If BSEE has objections, we will notify you in writing within 60 
business days of the report being deemed submitted. Following initial 
notification of any objections, BSEE may follow up with written 
correspondence detailing its objections to the report and requesting 
that certain actions be undertaken. You cannot commence fabrication or 
installation activities on the OCS that are addressed in such reports 
until you resolve all objections to BSEE's satisfaction.

0
19. Amend Sec.  285.701 by:
0
a. Revising paragraphs (a)(1) through (10);

[[Page 42716]]

0
b. Adding paragraphs (a)(11) through (13);
0
c. Revising paragraphs (b), (c), and (d); and
0
d. Removing paragraph (e).
    The revisions and additions read as follows:


Sec.  285.701  What must I include in my Facility Design Report?

    (a) * * *

------------------------------------------------------------------------
      Required documents                   Required contents
------------------------------------------------------------------------
(1) Cover letter.............  (i) Proposed facility designations:
                               (ii) Lease, ROW grant or RUE grant
                                number;
                               (iii) Area; name and block numbers; and
                               (iv) The type of facility.
(2) Location plat............  (i) Latitude and longitude coordinates,
                                Universal Mercator grid-system
                                coordinates, State plane coordinates in
                                the Lambert or Transverse Mercator
                                Projection System;
                               (ii) Distances in feet from the nearest
                                block lines. These coordinates must be
                                based on the NAD (North American Datum)
                                83 datum plane coordinate system; and
                               (iii) The location of any project
                                easements.
(3) Front, Side, and Plan      (i) Facility dimensions and orientation;
 View drawings.                (ii) Elevations relative to Mean Lower
                                Low Water; and
                               (iii) Pile sizes and penetration.
(4) Complete set of            The approved for construction fabrication
 structural drawings.           drawings should be submitted including,
                                e.g.,
                               (i) Cathodic protections systems;
                               (ii) Jacket design;
                               (iii) Pile foundations;
                               (iv) Mooring, tendon and tethering
                                systems;
                               (v) Foundations and anchoring systems;
                                and
                               (vi) Associated cable and pipeline
                                designs.
(5) Summary of environmental   A summary of the environmental data used
 data used for design.          in the design or analysis of the
                                facility. Examples of relevant data
                                include information on:
                               (i) Extreme weather;
                               (ii) Seafloor conditions; and
                               (iii) Waves, wind, current, tides,
                                temperature, snow and ice effects,
                                marine growth, and water depth.
(6) Summary of the             (i) Loading information (e.g., live,
 engineering design data.       dead, environmental);
                               (ii) Structural information (e.g., design-
                                life; material types; cathodic
                                protection systems; design criteria;
                                fatigue life; jacket design; deck
                                design; production component design;
                                foundation pilings and templates, and
                                mooring, tethering or tendon systems;
                                fabrication and installation
                                guidelines);
                               (iii) Location of foundation boreholes
                                and foundation piles;
                               (iv) Foundation information (e.g., soil
                                stability, design criteria); and
                               (v) For a floating facility, structural
                                integrity, stability, and ballast
                                information. This includes foundations,
                                piles, templates, anchors or anchor
                                systems, mooring, tethering and tendon
                                systems.
(7) A complete set of design   Self-explanatory.
 calculations.
(8) Project-specific studies   All studies pertinent to facility design
 used in the facility design    or installation, e.g., oceanographic and
 or installation.               soil reports including the results of
                                the survey required in 30 CFR
                                585.610(b), 585.626(b), or 585.645(b).
(9) Description of the loads   (i) Loads imposed by the jacket;
 imposed on the facility.      (ii) Decks;
                               (iii) Production components;
                               (iv) Foundations, foundation pilings and
                                templates, and anchoring systems; and
                               (v) Mooring, tendon or tethering systems.
(10) Geotechnical reports....  Reports and supporting data from
                                geotechnical surveys, in situ
                                explorations, laboratory tests,
                                analyses, burial or drivability
                                assessments, and recommended design
                                parameters.
(11) Design Standards........  The industry standards you will apply to
                                ensure the facilities are designed to
                                meet Sec.   285.105.
(12) Critical Safety Systems   A risk assessment that identifies the
 and Equipment.                 Critical Safety Systems and Equipment
                                and a description of the identified
                                Critical Safety System and Equipment.
(13) Other information.......  Additional information required by BSEE.
------------------------------------------------------------------------

    (b) For any floating facility, your design must meet the 
requirements of the U.S. Coast Guard for structural integrity and 
stability (e.g., verification of center of gravity) as listed in 
paragraph (a)(6)(v) of this section. The design must also consider:
    (1) Foundations, foundation pilings and templates, and anchoring 
systems; and
    (2) Mooring, tendon, or tethering systems.
    (c) You must submit your FDR to BSEE pursuant to Sec.  285.110 and 
provide the location of records, as required in Sec.  285.714(c).
    (d) If you are required to use a CVA, the FDR must include the 
following certification statement with accompanying justification: 
``The design of this structure has been certified by a BSEE-approved 
CVA to be in accordance with accepted engineering practices and the 
approved SAP, GAP, or COP, as applicable, and has been designed to 
provide for safety. The certified design and as-built plans and 
specifications will be on file at [provide location].''

0
20. Amend Sec.  285.702 by:
0
a. Revising paragraphs (a)(1) through (7);
0
b. Adding paragraphs (a)(8) through (10);
0
c. Removing paragraph (d);
0
d. Redesignating paragraphs (b) and (c) as paragraphs (c) and (d), 
respectively;
0
e. Adding new paragraph (b); and
0
f. Revising newly redesignated paragraph (d).
    The revisions and additions read as follows:

[[Page 42717]]

Sec.  285.702  What must I include in my Fabrication and Installation 
Report?

    (a) * * *

------------------------------------------------------------------------
      Required documents                   Required contents
------------------------------------------------------------------------
(1) Cover letter.............  (i) Proposed facility designation, lease,
                                ROW grant, or RUE grant number;
                               (ii) Area, name, and block number; and
                               (iii) The type of facility.
(2) Schedule.................  Fabrication and installation schedule
                                information.
(3) Fabrication information..  The industry standards you will use to
                                ensure the facilities are fabricated to
                                the design criteria identified in your
                                Facility Design Report.
(4) Installation process       Details associated with the deployment
 information.                   activities, equipment, and materials,
                                including onshore and offshore equipment
                                and support, and anchoring and mooring
                                patterns.
(5) Federal, State, and local  Either one copy of the permit or
 permits (e.g., EPA, Army       information on the status of the
 Corps of Engineers).           application.
(6) Quality assurance........  Certificates ensuring adherence to a
                                nationally or internationally recognized
                                quality assurance standard. Alternate
                                means of compliance must be approved on
                                a case-by-case basis.
(7) Environmental information  Information about:
                               (i) Water discharge;
                               (ii) Waste disposal;
                               (iii) Vessel information;
                               (iv) Onshore waste receiving treatment or
                                disposal facilities; and
                               (v) If you submitted this data as part of
                                your SAP, COP, or GAP, you may
                                incorporate the information by
                                reference.
(8) Commissioning procedures   Original equipment manufacturer
 for Critical Safety Systems    procedures or other BSEE accepted
 and Equipment.                 engineering practices for commissioning
                                of Critical Safety Systems and Equipment
                                as identified in Sec.   285.701(a)(12).
(9) Project easement.........  Information about installation of any
                                cables, pipelines, or facilities.
                                Information on burial methods and
                                vessels.
(10) Other information.......  Additional information required by BSEE.
------------------------------------------------------------------------

    (b) You must submit your FIR to BSEE pursuant to Sec.  285.110.
* * * * *
    (d) If you are required to use a CVA, the FIR must include the 
following certification statement with accompanying justification: 
``The fabrication and installation of this structure has been certified 
by a BSEE-approved CVA to be in accordance with accepted engineering 
practices, the FDR, and the approved SAP, GAP, or COP, as applicable. 
The certified design and as-built plans and specifications will be on 
file at [provide location].''

0
21. Amend Sec.  285.703 by revising paragraphs (a) and (c) to read as 
follows:


Sec.  285.703  What reports must I submit for project modifications and 
repairs?

    (a) You must submit a Project Modification or Repair Report to BSEE 
in which you certify that major repairs and major modifications of 
renewable energy structures and crucial components to a completed 
project conform to accepted engineering practices.
    (1) A ``major repair'' is a corrective action involving structural 
members affecting the structural integrity of all or a portion of the 
facility or substantial repair of a Critical Safety Systems and 
Equipment, including those identified in your FDR.
    (2) A ``major modification'' is an alteration involving structural 
members affecting the structural integrity of all or a portion of the 
facility or substantial alteration of Critical Safety Systems and 
Equipment, including those as identified in your FDR.
* * * * *
    (c) If you are required to use a CVA, the report described in 
paragraph (a) of this section must include the following certification 
statement with accompanying justification: ``The [major modification or 
major repair] of this [structure or Critical Safety Systems and 
Equipment] has been certified by a BSEE-approved CVA to be in 
accordance with accepted engineering practices, the FDR, and the 
approved SAP, GAP, or COP as applicable.''

0
22. Add Sec.  285.704 to read as follows:


Sec.  285.704  After receiving the FDR, FIR, or project verification 
reports, what will BSEE do?

    (a) Determine whether the report is deemed submitted. Within 20 
business days after receiving your proposed FDR, FIR, or project 
verification report, BSEE will review your submission. BSEE will deem 
your FDR, FIR, or project verification report submitted if BSEE 
determines it is sufficiently complete and accurate to fulfill the 
applicable requirements of Sec.  285.701, Sec.  285.702, or Sec.  
285.712.
    (b) Identify problems and deficiencies. If BSEE determines that 
your submission has not met the conditions in paragraph (a) of this 
section, BSEE will notify you of the problem or deficiency within 20 
business days after BSEE receives your FDR, FIR, or project 
verification report. BSEE will not deem your FDR, FIR, or project 
verification report submitted until you have corrected all problems or 
deficiencies identified in the notice.
    (c) Notify you when the report is deemed submitted. BSEE will 
notify you when the FDR, FIR, or project verification reports are 
deemed submitted. If BSEE has not notified you within 20 business days 
that your report has problems or deficiencies, it is deemed submitted. 
Until your report is deemed submitted, the time period in Sec.  
285.700(d) does not begin running.

0
23. Revise Sec.  285.705 to read as follows:


Sec.  285.705  When must I use a Certified Verification Agent (CVA)?

    (a) Unless BSEE waives this requirement under paragraph (c) of this 
section, you must use one or more CVAs to review and verify your FDRs, 
FIRs, and the Project Modification and Repair Reports.
    (b) The purpose of a CVA is to:
    (1) Ensure that your facilities are designed, fabricated, and 
installed in conformance with accepted engineering practices and the 
FDR(s) and FIR(s); and that the design of the facilities is suitable 
for the location where they will be installed;
    (2) Ensure Critical Safety Systems and Equipment are commissioned 
in

[[Page 42718]]

accordance with the procedures identified in Sec.  285.702(a)(8);
    (3) Ensure that major repairs and major modifications are completed 
in conformance with accepted engineering practices; and
    (4) Provide BSEE and you with reports of all incidents that affect 
the facility design, fabrication, and installation, including 
commissioning of Critical Safety Systems and Equipment, for the project 
and its components.
    (c) BSEE may waive in whole or in part the requirement that you use 
a CVA if you can demonstrate the following:

------------------------------------------------------------------------
                                                Then BSEE may waive the
        If you demonstrate that . . .          requirement for a CVA for
                                                     the following:
------------------------------------------------------------------------
(1) The facility design conforms to a          The design of your
 standard design that has been used             structure(s).
 successfully in a similar environment, and
 the installation design conforms to accepted
 engineering practices.
(2) The relevant fabricator has successfully   The fabrication of your
 fabricated similar facilities, and the         structure(s).
 facility will be fabricated in conformance
 with accepted engineering practices and to a
 nationally or internationally recognized
 quality assurance standard.
(3) The installation company has successfully  The installation of your
 installed similar facilities in a similar      structure(s).
 offshore environment, and your structures
 will be installed in conformance with
 accepted engineering practices.
(4) Major repairs or major modifications will  The major repair or major
 be completed in conformance with accepted      modification on your
 engineering practices and to a nationally or   structure(s).
 internationally recognized quality assurance
 standard.
------------------------------------------------------------------------

    (d) You must submit a request to waive, in whole or in part, the 
requirement to use a CVA to BSEE in writing.
    (1) BSEE will review your request to waive, in whole or in part, 
the use of the CVA and notify you of its decision.
    (2) If BSEE does not waive, in whole or in part, the requirement 
for a CVA, you may file an appeal under Sec.  285.118.
    (3) If BSEE waives, in whole or in part, the requirement that you 
use a CVA, your project engineer must perform the same duties and 
responsibilities as would have the CVA, except as otherwise provided. 
You must submit the project engineer's qualifications to BSEE as a part 
of your waiver request to demonstrate that your project engineer is a 
professional engineer with relevant experience and expertise in the 
facilities they will be verifying/certifying.

0
24. Amend Sec.  285.706 by:
0
a. Revising paragraphs (a), (b)(2) and (7), (c), and (d);
0
b. Removing paragraph (e); and
0
c. Redesignating paragraph (f) as paragraph (e).
    The revisions read as follows:


Sec.  285.706   How do I nominate a CVA for BSEE approval?

    (a) A CVA must be nominated by the lessee and approved by BSEE 
before conducting any verification or certification activities for 
which they have been nominated. If you intend to use multiple CVAs, you 
must nominate a general project CVA who will manage the overall project 
verification and certification approach and who will ensure consistency 
and oversight among the CVAs, especially in transition areas between 
different CVAs. The general project CVA must be nominated no later than 
COP submission.
    (b) * * *
    (2) Technical capabilities of the individual or the primary staff 
for the specific project, including relevant professional licenses, 
certifications, and accreditations;
* * * * *
    (7) The scope and level of work to be performed by the CVA, 
including all relevant reports and facilities that the CVA will verify 
or certify.
    (c) Individuals or organizations acting as CVAs must not function 
in any capacity that will create a conflict of interest or the 
appearance of a conflict of interest. The CVA must not have prepared, 
or been directly involved in, any work related to the preparation of 
design, fabrication, installation, modification, or repair plans for 
which they will provide verification or certification services.
    (d) The verification and certification must be conducted by or 
under the direct supervision of a registered professional engineer.
* * * * *

0
25. Amend Sec.  285.707 by:
0
a. Revising the second sentence of paragraph (a);
0
b. Removing ``and'' from paragraph (b)(8);
0
c. Redesignating paragraph (b)(9) as paragraph (b)(10);
0
d. Adding new paragraph (b)(9); and
0
e. Revising paragraph (c).
    The revisions and addition read as follows:


Sec.  285.707  What are the CVA's primary duties for facility design 
review?

    (a) * * * The CVA must verify to BSEE that the facility is designed 
to withstand the environmental and functional load conditions 
appropriate for the intended service life at the proposed location and 
has been designed to minimize risk to personnel as required by Sec.  
285.105(a).
    (b) * * *
    (9) Risk assessments supporting the design for human safety and how 
the results are used in the design; and
* * * * *
    (c) For any floating facility, the CVA or project engineer must 
also verify that any requirements of the U.S. Coast Guard for 
structural integrity and stability (e.g., verification of center of 
gravity), have been met. The CVA must also consider:
    (1) Foundations, foundation pilings and templates, and anchoring 
systems; and
    (2) Mooring, tendon or tethering systems.

0
26. Revise Sec.  285.708 to read as follows:


Sec.  285.708  What are the CVA's or project engineer's primary duties 
for fabrication and installation review?

    (a) The CVA or project engineer must do all of the following:
    (1) Use good engineering judgment and practice in conducting an 
independent assessment of the fabrication and installation activities 
and of the commissioning of Critical Safety Systems and Equipment;
    (2) Monitor the fabrication and installation of the facility and 
the commissioning of Critical Safety Systems and Equipment as required 
by paragraph (b) of this section;
    (3) Make periodic onsite inspections while fabrication is in 
progress and verify the items required by Sec.  285.709;
    (4) Make periodic onsite inspections while installation is in 
progress and satisfy the requirements of Sec.  285.710;
    (5) Certify in Project Verification Reports that project components 
are fabricated and installed in accordance with accepted engineering 
practices and to a nationally or internationally recognized quality 
assurance standard

[[Page 42719]]

or to an equivalent alternate means of quality assurance considered on 
a case-by-case basis, your BOEM-approved SAP, COP, or GAP (as 
applicable), and your FIR. If multiple CVAs are involved in your 
project, the general project CVA must submit the final report 
containing such certification for the project. The Project Verification 
Report must identify the location of all records pertaining to facility 
fabrication and installation as required in Sec.  285.714(c);
    (6) Provide records documenting that Critical Safety Systems and 
Equipment are commissioned in accordance with the procedures identified 
in Sec.  285.702(a)(8); and
    (7) Identify the location of all records pertaining to 
commissioning of Critical Safety Systems and Equipment, as required in 
Sec.  285.714(c).
    (b) To comply with paragraphs (a)(4) and (5) of this section, the 
CVA or project engineer must monitor the fabrication and installation 
of the facility and the commissioning of Critical Safety Systems and 
Equipment to certify that they have been built and installed according 
to your FDRs and FIRs.
    (1) If the CVA or project engineer finds that either fabrication 
and installation procedures or Critical Safety Systems and Equipment 
commissioning procedures, or both, have been changed or design 
specifications have been modified, the CVA or project engineer must 
inform you and BSEE; and
    (2) If you accept the modifications, you must also inform BSEE.

0
27. Revise Sec.  285.709 to read as follows:


Sec.  285.709  When conducting onsite fabrication inspections, what 
must the CVA or project engineer verify?

    (a) To comply with Sec.  285.708(a)(3), the CVA or project engineer 
must make periodic onsite inspections while fabrication is in progress 
and must verify the following fabrication items, as appropriate:
    (1) Quality control by lessee (or grant holder) and builder;
    (2) Fabrication site facilities;
    (3) Material quality and identification methods;
    (4) Fabrication procedures specified in your FIRs and adherence to 
such procedures;
    (5) Welder and welding procedure qualification and identification;
    (6) Structural tolerances specified, and adherence to those 
tolerances;
    (7) Nondestructive examination requirements and evaluation results 
of the specified examinations;
    (8) Destructive testing requirements and results;
    (9) Repair procedures;
    (10) Installation of corrosion-protection systems and splash-zone 
protection;
    (11) Erection procedures to ensure that overstressing of structural 
members does not occur;
    (12) Alignment procedures;
    (13) Dimensional check of the overall structure, including any 
turrets, turret-and-hull interfaces, any mooring line and chain and 
riser tensioning line segments, and tendon or tethering systems; and
    (14) Status of quality-control records at various stages of 
fabrication.
    (b) For any floating facility, the CVA or project engineer must 
also verify that any requirements of the U.S. Coast Guard for 
structural integrity and stability (e.g., verification of center of 
gravity) have been met. The CVA or project engineer must also consider:
    (1) Foundations, foundation pilings and templates, and anchoring 
systems; and
    (2) Mooring, tendon, or tethering systems.

0
28. Revise Sec.  285.710 to read as follows:


Sec.  285.710  When conducting onsite installation inspections, what 
must the CVA or project engineer do?

    (a) To comply with Sec.  285.708(a)(4), the CVA or project engineer 
must make periodic onsite inspections while installation is in progress 
and must, as appropriate, verify, witness, survey, or check the 
installation and commissioning of items required by this section.
    (b) The CVA or project engineer must verify, as appropriate, all of 
the following:
    (1) Loadout and initial flotation procedures;
    (2) Towing operation procedures to the specified location, 
including a review of the towing records;
    (3) Launching and uprighting activities;
    (4) Submergence activities;
    (5) Pile or anchor installations;
    (6) Installation of mooring, tendon, and tethering systems;
    (7) Final deck and component installations;
    (8) Installation at the locations set forth in your FDR(s) and 
FIR(s); and
    (9) Commissioning of Critical Safety Systems and Equipment.
    (c) For a fixed or floating facility, the CVA or project engineer 
must verify that proper procedures were used during the following:
    (1) The loadout of the jacket, decks, piles, or structures from 
each fabrication site;
    (2) The actual installation of the facility or major modification 
and the related installation activities; and
    (3) Commissioning of Critical Safety Systems and Equipment.
    (d) For a floating facility, the CVA or project engineer must 
verify structural integrity, stability, and ballast, and that proper 
procedures were used during the following:
    (1) The loadout of the facility;
    (2) The installation of foundation pilings and templates, and 
anchoring systems; and
    (3) The installation of the mooring and tethering and tendon 
systems.
    (e) The CVA or project engineer must conduct an onsite inspection 
of the installed facility as approved in your CVA scope of work.
    (f) The CVA or project engineer must make periodic onsite 
inspections to witness the commissioning of Critical Safety Systems and 
Equipment in order to verify that:
    (1) The Critical Safety Systems and Equipment function as designed; 
and
    (2) The final commissioning Critical Safety Systems and Equipment 
records are complete.
    (g) The CVA or project engineer must spot-check the equipment, 
procedures, and recordkeeping as necessary to determine compliance with 
the applicable documents incorporated by reference and the regulations 
under this part.

0
29. Amend Sec.  285.712 by:
0
a. Revising paragraph (a) and the first sentence of paragraph (b) 
introductory text;
0
c. Removing ``and'' at the end of paragraph (b)(3);
0
d. Removing the period at the end of paragraph (b)(4) and adding in its 
place ``; and''; and
0
e. Adding paragraph (b)(5).
    The revisions and addition read as follows:


Sec.  285.712  What are the CVA's or project engineer's reporting 
requirements?

    (a) The CVA or project engineer must prepare and submit to you and 
BSEE all reports and records required by this subpart. The CVA or 
project engineer must also submit interim reports to you and BSEE, as 
requested by BSEE. BSEE will review and respond within 30 days.
    (b) For each report required by this subpart, the CVA or project 
engineer must submit the final report to BSEE pursuant to Sec.  
285.110. * * *
* * * * *
    (5) Summarize any issues with the design and any incidents during 
facility fabrication and installation, or Critical Safety System and 
Equipment commissioning, and how those issues were resolved.

[[Page 42720]]

Sec.  285.713  [Removed and Reserved]

0
30. Remove and reserve Sec.  285.713.

0
31. Amend Sec.  285.714 by:
0
a. Revising the section heading;
0
b. Redesignating paragraphs (a)(4) and (5) as paragraphs (a)(5) and 
(6), respectively;
0
c. Adding new paragraph (a)(4); and
0
d. Revising paragraph (c).
    The revisions and addition read as follows:


Sec.  285.714  What records relating to FDRs, FIRs, and Project 
Modification and Repair Reports must I keep?

    (a) * * *
    (4) The records of the commissioning of Critical Safety Systems and 
Equipment;
* * * * *
    (c) You must provide BSEE with the location of these records, as 
required in Sec. Sec.  285.701(c) and (d), 285.702(c) and (d), 
285.703(b), and 285.708(a)(5) and (7).

Subpart H--Environmental and Safety Management, Inspections, and 
Facility Assessments for Activities Conducted Under SAPS, COPS, and 
GAPs

0
32. Revise Sec.  285.810 to read as follows:


Sec.  285.810  When must I submit a Safety Management System (SMS) and 
what must I include in my SMS?

    You are required to use a Safety Management System (SMS) for 
activities conducted on the OCS to develop or operate a lease, from met 
buoy placement and site assessment work through decommissioning, and to 
provide your SMS to BSEE upon request. You must also submit a detailed 
description of the SMS with your COP (as provided in 30 CFR 585.627(d)) 
and, when required by this part, your SAP (as provided in Sec.  
285.614(b)) or GAP (as provided in Sec.  285.651). Your SMS must 
address:
    (a) How you will ensure the safety of your personnel or anyone else 
on or near your facilities, such as:
    (1) Health and safety risks that anyone on your facilities or 
engaged in lease activities are likely to face during activities 
covered by the SMS;
    (2) Policies and strategies that will be used to control such 
risks;
    (3) Procedures and nationally or internationally recognized 
standards that will be followed to ensure the safety of the activities 
covered by the SMS;
    (4) Methods that will be used to monitor the implementation of the 
SMS and maintain the safety of activities covered by the SMS, including 
management of change and stop work practices; and
    (5) Procedures for personnel to report unsafe work conditions both 
to the lessee or its designated operator and to BSEE.
    (b) Remote monitoring, control, and shut down capabilities, such 
as:
    (1) Aspects of operations and mechanical and structural integrity 
that will be monitored remotely;
    (2) Circumstances under which remote monitoring will be activated 
and how it will be maintained;
    (3) Maintenance of the security of the remote sensing and control 
capabilities;
    (4) Monitoring of conditions if remote sensing equipment fails; and
    (5) Conditions that will result in the shutdown of one or more 
facilities.
    (c) Emergency response procedures, such as:
    (1) Types of incidents to be addressed (e.g., serious injury to 
workers during maintenance, unexploded ordnance encountered during 
construction, damage due to hurricane or allision by vessels or 
aircraft, unauthorized access into remote monitoring capabilities, 
evacuation, and search and rescue);
    (2) Potential response activities, including U.S. Coast Guard 
(USCG), other government agencies, and contractor support, for each 
category of incident;
    (3) Management controls, authorities, and reporting to be employed 
for each response;
    (4) Locations from which emergency response will be controlled; and
    (5) Resources available to assist in the response.
    (d) Fire suppression equipment, such as a description of how and 
when it will be used, if needed.
    (e) How and when you will test your SMS, such as:
    (1) Plans, processes, and schedules for:
    (i) Self or third-party auditing of the SMS; and
    (ii) Regular testing of certain SMS components, including remote 
shutdown capabilities and emergency response readiness; and
    (2) Corrective action processes to improve the effectiveness of 
your SMS based on the results of audits, tests, investigations of 
incidents (including near-misses), feedback from the field, and other 
information sources.
    (f) How you will ensure personnel who conduct activities on your 
facilities are properly trained and have the capability to safely 
perform duties, such as:
    (1) Required training for personnel who conduct activities on your 
facilities; and
    (2) Required knowledge and skills to ensure that personnel perform 
duties safely for the duration of activities.

0
33. Revise Sec.  285.811 to read as follows:


Sec.  285.811  Am I required to obtain a certification of my SMS?

    You are not required to obtain a certification that your SMS meets 
acceptable health and safety standards (e.g., ANSI/ASSP Z10.0, API RP 
75, ISO 45001) from a recognized accreditation organization. However, 
BSEE will consider such certification in determining the frequency and 
scope of SMS-related inspections that it conducts under this subpart, 
as well as the scope and nature of its oversight over any audit-induced 
corrective actions.

0
34. Add Sec.  285.812 to read as follows:


Sec.  285.812  How must I implement my SMS?

    (a) Your SMS must be functional before you begin, and must remain 
functional while you perform, any activity on the OCS pursuant to a 
lease, including met buoy placement and site assessment work, or for 
any activities described in your approved SAP, COP, or GAP. You must 
conduct all activities described in your approved SAP, COP, or GAP in 
accordance with the SMS you described under Sec.  285.810.
    (b) You must regularly demonstrate to BSEE that your SMS is being 
implemented effectively by submitting the following to BSEE in 
accordance with Sec.  285.110:
    (1) By March 31st of each year, summarize safety and work hour 
performance data for the prior calendar year in which you conducted 
site assessment, construction, operations, or decommissioning 
activities in accordance with your lease terms, using a form available 
on the BSEE website; and
    (2) Once every 3 years and upon BSEE's request, provide a report to 
BSEE summarizing the results of your most recent SMS audit, corrective 
actions implemented or being implemented as a result of that audit, and 
an updated description of your SMS highlighting changes that were made 
since the last such submission to BSEE.

0
35. Amend Sec.  285.815 by revising the second sentence of paragraph 
(a) to read as follows:


Sec.  285.815  What must I do if I have facility damage or an equipment 
failure?

    (a) * * * If you have a major repair, you must submit a report to 
BSEE under Sec.  285.703.
* * * * *

0
36. Revise Sec.  285.820 to read as follows:

[[Page 42721]]

Sec.  285.820  Will BSEE conduct inspections?

    BSEE may inspect OCS facilities and any vessels engaged in 
activities authorized under this part. When we conduct these 
inspections, we will:
    (a) Verify that you are conducting activities in compliance with 
subsection 8(p) of the OCS Lands Act; the regulations in this part; the 
terms, conditions, and stipulations of your lease or grant; approved 
plans; and other applicable laws and regulations.
    (b) Determine whether proper safety equipment has been installed 
and is operating properly according to your SMS, as required in Sec.  
285.810.

0
37. Revise Sec.  285.821 to read as follows:


Sec.  285.821  Will BSEE conduct scheduled and unscheduled inspections?

    BSEE may conduct both scheduled and unscheduled inspections.

0
38. Amend Sec.  285.822 by revising paragraphs (a)(1) and (b) to read 
as follows:


Sec.  285.822  What must I do when BSEE conducts an inspection?

    (a) * * *
    (1) Provide access to all facilities on your lease (including your 
project easement) or grant and any vessels engaged in activities 
authorized under this part; and
* * * * *
    (b) You must retain the records referenced in paragraph (a)(2)(iii) 
of this section until BOEM releases your financial assurance under 30 
CFR585.534 and provide them to BSEE upon request within the time period 
specified by BSEE.
* * * * *

0
39. Revise Sec.  285.824 as follows:


Sec.  285.824  How must I conduct self-inspections?

    (a) You must develop a comprehensive self-inspection plan covering 
all of your facilities. You must keep this self-inspection plan 
wherever you keep your records and make it available to BSEE upon 
request. Your self-inspection plan must specify:
    (1) The type, extent, and frequency of inspections that you will 
conduct for both the above-water and the below-water structures of all 
facilities and pertinent components of the mooring, tendon, or 
tethering systems for any floating facilities;
    (2) How you will monitor the corrosion protections for both above-
water and below-water structures; and
    (3) How you will fulfill the requirement for annual on-site 
inspection of all Critical Safety Systems and Equipment.
    (b) You must conduct an onsite inspection of each of your 
facilities at least once a year. This inspection must include, but is 
not limited to, all Critical Safety Systems and Equipment.
    (1) You must develop and retain summary reports for all such 
inspections for each calendar year. The summary report must note any 
failures of operability, required maintenance of Critical Safety 
Systems and Equipment, or required replacement of the Critical Safety 
Systems and Equipment identified during inspection.
    (2) You must retain records of inspections and summary reports for 
the previous 2 calendar years and make them available to BSEE on 
request.
    (c) You must submit a report annually to BSEE no later than 
November 1st that must include:
    (1) A list of facilities inspected for structural condition and 
corrosion protection in the preceding 12 months;
    (2) The type of inspection employed (i.e., visual, magnetic 
particle, ultrasonic testing); and
    (3) A summary of the inspection indicating what repairs, if any, 
were needed and the overall structural condition of the facility.

0
40. Amend Sec.  285.830 by revising paragraph (d) to read as follows


Sec.  285.830  What are my incident reporting requirements?

* * * * *
    (d) You must report all spills of oil or other liquid pollutants in 
accordance with 30 CFR 250.187(d).

Subpart I--Decommissioning

0
41. Amend Sec.  285.900 by adding paragraph (c) to read as follows:


Sec.  285.900  Who must meet the decommissioning obligations in this 
subpart?

* * * * *
    (c) If a lessee or grant holder has installed a facility on a lease 
or grant that was authorized by an authority other than BOEM and that 
approving authority has imposed a decommissioning obligation, such 
obligation will substitute for the requirements of this subpart. The 
decommissioning requirements in this subpart will apply to such a 
facility if the authorizing agency has not imposed or enforced a 
decommissioning obligation.

0
42. Amend Sec.  285.902 by revising the introductory text of paragraph 
(a) to read as follows:


Sec.  285.902   What are the general requirements for decommissioning 
for facilities authorized under my SAP, COP, or GAP?

    (a) Except as otherwise authorized under Sec.  285.909, within 2 
years following termination of a lease or grant, or earlier if BSEE 
determines a facility is no longer useful for operations, you must:
* * * * *

0
43. Amend Sec.  285.905 by adding paragraph (e) to read as follows:


Sec.  285.905  When must I submit my decommissioning application?

* * * * *
    (e) Ninety (90) calendar days after BSEE determines a facility is 
no longer useful for operations.

PART 585--RENEWABLE ENERGY ON THE OUTER CONTINENTAL SHELF

0
44. The authority citation for part 585 continues to read as follows:

    Authority: 43 U.S.C. 1337.


0
45. Revise subpart A to read as follows:

Subpart A--General Provisions

Sec.
585.100 Authority.
585.101 What is the purpose of this part?
585.102 What are BOEM's responsibilities under this part?
585.103 When may BOEM prescribe or approve departures from the 
regulations in this part?
585.104 Do I need a BOEM lease or other authorization to produce or 
support the production of electricity or other energy product from a 
renewable energy resource on the OCS?
585.105 What are my responsibilities under this part?
585.106 What happens if I fail to comply with this part?
585.107 Who can acquire or hold a lease or grant under this part?
585.108 How do I show that I am qualified to be a lessee or grant 
holder?
585.109 When must I notify BOEM if an action has been filed alleging 
that I am insolvent or bankrupt?
585.110 When must I notify BOEM of mergers, name changes, or changes 
of business form?
585.111 How do I submit plans, applications, reports, or notices 
required by this part?
585.112 When and how does BOEM charge me processing fees on a case-
by-case basis?
585.113 Definitions.
585.114 How will data and information obtained by BOEM under this 
part be disclosed to the public?
585.115 Paperwork Reduction Act statements--information collection.
585.116 Requests for information.
585.117 Severability.

[[Page 42722]]

585.118 What are my appeal rights?
585.119-585.149 [Reserved]

Subpart A--General Provisions


Sec.  585.100  Authority.

    The authority for this part derives from section 8 of the Outer 
Continental Shelf Lands Act (OCS Lands Act) (43 U.S.C. 1337). The 
Secretary of the Interior delegated to the Bureau of Ocean Energy 
Management (BOEM) the authority to manage the development of energy on 
the Outer Continental Shelf (OCS) from sources other than oil and gas, 
including renewable energy, through the issuance of leases, easements, 
and right-of-way for activities that produce or support the production, 
transportation, or transmission of energy.


Sec.  585.101  What is the purpose of this part?

    The purpose of this part is to:
    (a) Establish procedures for issuance and administration of leases, 
right-of-way (ROW) grants, and right-of-use and easement (RUE) grants 
for renewable energy production on the OCS;
    (b) Inform you and third parties of your obligations when you 
undertake activities authorized in this part; and
    (c) Ensure that renewable energy activities on the OCS are 
conducted in a safe and environmentally sound manner, in conformance 
with the requirements of subsection 8(p) of the OCS Lands Act, other 
applicable laws and regulations, and the terms of your lease, ROW 
grant, or RUE grant.
    (d) This part will not convey access rights for oil, gas, or other 
minerals.


Sec.  585.102  What are BOEM's responsibilities under this part?

    (a) BOEM will ensure that any activities authorized in this part 
are carried out in a manner that provides for and reaches a rational 
balance among the following goals to the extent they conflict or are 
otherwise in tension, none of which inherently outweighs or supplants 
any other:
    (1) Safety;
    (2) Protection of the environment;
    (3) Prevention of waste, including economic waste and physical 
waste of energy resources from sources other than oil and gas;
    (4) Conservation of the natural resources of the OCS;
    (5) Coordination with relevant Federal agencies (including, in 
particular, those agencies involved in planning activities that are 
undertaken to avoid conflicts among users and to maximize the economic 
and ecological benefits of the OCS, including multifaceted spatial 
planning efforts);
    (6) Protection of national security interests of the United States;
    (7) Protection of the rights of other authorized users of the OCS;
    (8) A fair return to the United States;
    (9) Prevention of interference with reasonable uses of the 
exclusive economic zone, the high seas, and the territorial seas (as 
determined by the Secretary);
    (10) Consideration of the location of and any schedule relating to 
a lease or grant under this part for an area of the OCS, and any other 
use of the sea or seabed;
    (11) Public notice and comment on any proposal submitted for a 
lease or grant under this part; and
    (12) Oversight, research, monitoring, and enforcement of activities 
authorized by a lease or grant under this part.
    (b) BOEM will require compliance with all applicable laws, 
regulations, other requirements, and the terms of your lease or grant 
and approved plans under this part. BOEM will approve, disapprove, or 
approve with conditions any plans, applications, or other documents 
submitted to BOEM for approval under the provisions of this part.
    (c) Unless otherwise provided in this part, BOEM may give oral 
directives or decisions whenever prior BOEM approval is required under 
this part. BOEM will document in writing any such oral directives 
within 10 business days.
    (d) BOEM will establish practices and procedures to govern the 
collection of all payments due to the Federal Government required under 
the regulations of this part, including any cost recovery fees, rents, 
operating fees, and other fees or payments. BOEM will do this in 
accordance with the terms of this part, the leasing notice, the lease 
or grant under this part, and applicable Office of Natural Resources 
Revenue (ONRR) regulations or guidance.
    (e) BOEM will provide for coordination and consultation with the 
Governor of any State, the executive of any local government, and the 
executive of any Indian Tribe that may be affected by a lease, 
easement, or ROW under this section. BOEM may invite any affected State 
Governor, representative of an affected Indian Tribe, and affected 
local government executive to join in establishing a task force or 
other joint planning or coordination agreement in carrying out our 
responsibilities under this part.


Sec.  585.103  When may BOEM prescribe or approve departures from the 
regulations in this part?

    (a) BOEM may prescribe or approve departures from the provisions of 
this part when BOEM deems the departure necessary because the 
applicable provisions as applied to a specific circumstance:
    (1) Are impractical or unduly burdensome and the departure is 
necessary to achieve the intended objectives of the renewable energy 
program;
    (2) Fail to conserve the natural resources of the OCS;
    (3) Fail to protect life (including human and wildlife), property, 
or the marine, coastal, or human environment; or
    (4) Fail to protect sites, structures, or objects of historical or 
archaeological significance.
    (b) Any departure approved under this section and its rationale 
must:
    (1) Be consistent with subsection 8(p) of the OCS Lands Act;
    (2) Protect the environment and the public health and safety to the 
same degree as if there was no approved departure from this part;
    (3) Not impair the rights of third parties; and
    (4) Be documented in writing.


Sec.  585.104  Do I need a BOEM lease or other authorization to produce 
or support the production of electricity or other energy product from a 
renewable energy resource on the OCS?

    Except as otherwise authorized by law, it is unlawful for any 
person to construct, operate, or maintain any facility to produce, 
transport, or support generation of electricity or other energy product 
derived from a renewable energy resource on any part of the OCS, except 
in accordance with the terms of a lease, easement, or ROW issued under 
the OCS Lands Act.


Sec.  585.105   What are my responsibilities under this part?

    As a lessee, applicant, operator, or holder of a ROW or RUE grant, 
you must:
    (a) Design your projects and conduct all activities in a manner 
that ensures safety and will not cause undue harm or damage to natural 
resources, including their physical, atmospheric, and biological 
components to the extent practicable; and take measures to prevent 
unauthorized discharge of pollutants including marine trash and debris 
into the offshore environment;
    (b) Submit requests, applications, plans, notices, modifications, 
and supplemental information to BOEM as required by this part;
    (c) Follow up, in writing, any oral request or notification you 
made, within 3 business days;
    (d) Comply with all applicable laws and regulations, the terms of 
your lease

[[Page 42723]]

or grant under this part, reports, notices, and approved plans prepared 
under this part, and any conditions imposed by BOEM through its review 
of any of these reports, notices, and approved plans, as provided in 
this part;
    (e) Make all applicable payments on time;
    (f) Comply with the DOI's nonprocurement debarment regulations at 2 
CFR part 1400;
    (g) Include the requirement to comply with 2 CFR part 1400 in all 
contracts and transactions related to a lease or grant under this part;
    (h) Conduct all activities authorized by the lease or grant in a 
manner consistent with the provisions of subsection 8(p) of the OCS 
Lands Act;
    (i) Compile, retain, and make available to BOEM representatives, 
within the time specified by BOEM, any data and information related to 
the site assessment, design, and operations of your project; and
    (j) Respond to requests from the Director in a timely manner.


Sec.  585.106  What happens if I fail to comply with this part?

    (a) BOEM may take appropriate corrective action under this part if 
you fail to comply with applicable provisions of Federal law, the 
regulations in this part, other applicable regulations, any order of 
the Director, the provisions of a lease or grant issued under this 
part, or the requirements of an approved plan or other approval under 
this part.
    (b) BOEM may issue to you a notice of noncompliance if we determine 
that there has been a violation of the regulations in this part, any 
order of the Director, or any provision of your lease, grant, or other 
approval issued under this part. When issuing a notice of 
noncompliance, BOEM will serve you at your last known address.
    (c) A notice of noncompliance will tell you how you failed to 
comply with this part, any order of the Director and/or the provisions 
of your lease, grant or other approval, and will specify what you must 
do to correct the noncompliance and the time limits within which you 
must act.
    (d) Failure of a lessee, operator, or grant holder to take the 
actions specified in a notice of noncompliance issued under this part 
within the time limit specified provides the basis for issuance of a 
cessation order by BSEE, as provided in 30 CFR 285.401 and/or 
cancellation of the lease or grant by the Secretary as provided in 
Sec.  585.422.
    (e) BOEM may assess civil penalties, as authorized by section 24 of 
the OCS Lands Act and as determined under the procedures set forth in 
30 CFR part 550, subpart N, if you fail to comply with any provision of 
this part or any term of a lease, grant, or order issued under the 
authority of this part:
    (1) After notice of such failure and expiration of any reasonable 
period allowed for corrective action; or
    (2) BOEM determines that the failure constitutes, or constituted, a 
threat of serious, irreparable, or immediate harm or damage to life 
(including fish and other aquatic life), property, or the marine, 
coastal, or human environment.


Sec.  585.107  Who can acquire or hold a lease or grant under this 
part?

    (a) You may acquire or hold a lease or grant under this part if you 
can demonstrate that you have the technical and financial capabilities 
to conduct the activities authorized by the lease or grant and you are 
a(n):
    (1) Citizen or national of the United States;
    (2) Alien lawfully admitted for permanent residence in the United 
States as defined in 8 U.S.C. 1101(a)(20);
    (3) Private, public, or municipal corporations organized under the 
laws of any State of the United States, the District of Columbia, or 
any territory or insular possession subject to U.S. jurisdiction;
    (4) Association of such citizens, nationals, resident aliens, or 
corporations;
    (5) Executive agency of the United States as defined in 5 U.S.C. 
105;
    (6) State of the United States; or
    (7) Political subdivision of a State of the United States.
    (b) You may not acquire or hold a lease or grant under this part or 
acquire an interest in a lease or grant under this part if:
    (1) You or your principals are excluded or disqualified from 
participating in transactions covered by the Federal nonprocurement 
debarment and suspension system (2 CFR part 1400), unless BOEM 
explicitly has approved an exception for this transaction;
    (2) BOEM determines or has previously determined after notice and 
opportunity for a hearing that you or your principals have failed to 
meet or exercise due diligence under any OCS lease or grant; or
    (3) After written notice and your opportunity to be heard, BOEM 
determines that:
    (i) You no longer meet the qualification requirements for acquiring 
or holding a lease or grant in paragraph (a) of this section.
    (ii) You have:
    (A) Violated an applicable law, regulation, order, lease or grant 
provision, approved plan, or the prohibitions prescribed in a final 
sale notice; or otherwise engaged in illegal activity, anti-competitive 
or collusive behavior, fraud, or misrepresentation; and
    (B) Failed to take timely remedial action as specified in the 
written notice provided by BOEM of the basis for the disqualification.
    (c) As long as a party is excluded or disqualified from acquiring 
or holding a lease or grant under this part, it is also ineligible to 
participate in BOEM's competitive and noncompetitive lease or grant 
issuance processes, including auctions, conducted under this part, even 
as an agent for another entity. A party can restore its eligibility by 
completing the remedial action specified in the notice of the proposed 
disqualification.
    (d) You may share ownership interests in a lease with one or more 
other persons, provided that all interest holders in the lease are 
eligible to hold a lease pursuant to this section and Sec.  585.108.


Sec.  585.108  How do I show that I am qualified to be a lessee or 
grant holder?

    (a) You must demonstrate your technical and financial capability to 
construct, operate, maintain, and terminate/decommission projects for 
which you are requesting authorization. Documentation can include:
    (1) Descriptions of international or domestic experience with 
renewable energy projects or other types of electric-energy-related 
projects; and
    (2) Information establishing access to sufficient capital to carry 
out development.
    (b) An individual must submit a written statement of citizenship 
status attesting to U.S. citizenship. It does not need to be notarized 
nor give the age of individual. A resident alien may submit a photocopy 
of the U.S. Citizenship and Immigration Services form issued by the 
appropriate Federal immigration authority evidencing legal status as a 
resident alien.
    (c) A corporation or association must submit evidence, as specified 
in the table in paragraph (d) of this section, acceptable to BOEM that:
    (1) It is qualified to hold leases or grants under this part;
    (2) It is authorized to conduct business under the laws of its 
State;
    (3) It is authorized to hold leases or grants on the OCS under the 
operating rules of its business; and
    (4) The persons holding the titles listed are authorized to bind 
the corporation or association when conducting business with BOEM.

[[Page 42724]]

    (d) Acceptable evidence under paragraph (c) of this section 
includes, but is not limited to the following:

----------------------------------------------------------------------------------------------------------------
   Requirements to qualify to hold leases or                      Ltd.         Gen.
               grants on the OCS:                   Corp.       prtnsp.      prtnsp.        LLC         Trust
----------------------------------------------------------------------------------------------------------------
(1) Original certificate or certified copy from          XX   ...........  ...........  ...........  ...........
 the State of incorporation stating the name of
 the corporation exactly as it must appear on
 all legal documents...........................
(2) Certified statement by Secretary/Assistant           XX   ...........  ...........  ...........  ...........
 Secretary over corporate seal, certifying that
 the corporation is authorized to hold OCS
 leases........................................
(3) Evidence of authority of titled positions            XX   ...........  ...........  ...........  ...........
 to bind corporation, certified by Secretary/
 Assistant Secretary over corporate seal,
 including the following:
    (i) Certified copy of resolution of the      ...........  ...........  ...........  ...........  ...........
     board of directors with titles of officers
     authorized to bind corporation............
    (ii) Certified copy of resolutions granting  ...........  ...........  ...........  ...........  ...........
     corporate officer authority to issue a
     power of attorney.........................
    (iii) Certified copy of power of attorney    ...........  ...........  ...........  ...........  ...........
     or certified copy of resolution granting
     power of attorney.........................
(4) Original certificate or certified copy of    ...........          XX           XX           XX   ...........
 partnership or organization paperwork
 registering with the appropriate State
 official......................................
(5) Copy of articles of partnership or           ...........          XX           XX           XX   ...........
 organization evidencing filing with
 appropriate Secretary of State, certified by
 Secretary/Assistant Secretary of partnership
 or member or manager of LLC...................
(6) Original certificate or certified copy       ...........          XX           XX           XX   ...........
 evidencing State where partnership or LLC is
 registered. Statement of authority to hold OCS
 leases, certified by Secretary/Assistant
 Secretary, OR original paperwork registering
 with the appropriate State official...........
(7) Statements from each partner or LLC member   ...........          XX           XX           XX   ...........
 indicating the following:
    (i) If a corporation or partnership,         ...........  ...........  ...........  ...........  ...........
     statement of State of organization and
     authorization to hold OCS leases,
     certified by Secretary/Assistant Secretary
     over corporate seal, if a corporation.....
    (ii) If an individual, a statement of        ...........  ...........  ...........  ...........  ...........
     citizenship...............................
(8) Statement from general partner, certified    ...........          XX   ...........  ...........  ...........
 by Secretary/Assistant Secretary that:
    (i) Each individual limited partner is a     ...........  ...........  ...........  ...........  ...........
     U.S. citizen and;
    (ii) Each corporate limited partner or       ...........  ...........  ...........  ...........  ...........
     other entity is incorporated or formed and
     organized under the laws of a U.S. State
     or territory..............................
(9) Evidence of authority to bind partnership    ...........          XX           XX           XX   ...........
 or LLC, if not specified in partnership
 agreement, articles of organization, or LLC
 regulations, i.e., certificates of authority
 from Secretary/Assistant Secretary reflecting
 authority of officers.........................
(10) Listing of members of LLC certified by      ...........  ...........  ...........          XX   ...........
 Secretary/Assistant Secretary or any member or
 manager of LLC................................
(11) Copy of trust agreement or document         ...........  ...........  ...........  ...........          XX
 establishing the trust and all amendments,
 properly certified by the trustee with
 reference to where the original documents are
 filed.........................................
(12) Statement indicating the law under which    ...........  ...........  ...........  ...........          XX
 the trust is established and that the trust is
 authorized to hold OCS leases or grants.......
----------------------------------------------------------------------------------------------------------------

    (e) A local, State, or Federal executive entity must submit a 
written statement that:
    (1) It is qualified to hold leases or grants under this part; and
    (2) The person(s) acting on behalf of the entity is authorized to 
bind the entity when conducting business with us.
    (f) BOEM may require you to submit additional information at any 
time considering your bid or request for a noncompetitive lease.


Sec.  585.109  When must I notify BOEM if an action has been filed 
alleging that I am insolvent or bankrupt?

    You must notify BOEM within 3 business days after you learn of any 
action filed alleging that you are insolvent or bankrupt.


Sec.  585.110  When must I notify BOEM of mergers, name changes, or 
changes of business form?

    You must notify BOEM in writing of any merger, name change, or 
change of business form. You must notify BOEM as soon as practicable 
following the merger, name change, or change in business form, but no 
later than 120 days after the earliest of either the effective date, or 
the date of filing the change or action with the Secretary of the State 
or other authorized official in the State of original registry.


Sec.  585.111  How do I submit plans, applications, reports, or notices 
required by this part?

    Unless otherwise stated, you must submit one electronic copy of all 
plans, applications, reports, or notices required by this part to BOEM. 
BOEM will inform you if it requires paper copies of specific documents. 
Unless stated otherwise, documents should be submitted to the relevant 
contacts listed on the BOEM website.


Sec.  585.112   When and how does BOEM charge me processing fees on a 
case-by-case basis?

    (a) BOEM will charge a processing fee on a case-by-case basis under 
the procedures in this section with regard to any application or 
request under this part if we decide at any time that the preparation 
of a particular document or study is necessary for the application or 
request and it will have a unique processing cost, such as the 
preparation of an Environmental Assessment (EA) or Environmental Impact 
Statement (EIS).

[[Page 42725]]

    (1) Processing costs will include contract oversight and efforts to 
review and approve documents prepared by contractors, whether the 
contractor is paid directly by the applicant or through BOEM.
    (2) We may apply a standard overhead rate to direct processing 
costs.
    (b) We will assess the ongoing processing fee for each individual 
application or request according to the following procedures:
    (1) Before we process your application or request, we will give you 
a written estimate of the proposed fee based on reasonable processing 
costs.
    (2) You may comment on the proposed fee.
    (3) You may:
    (i) Ask for our approval to perform, or to directly pay a 
contractor to perform, all or part of any document, study, or other 
activity according to standards we specify, thereby reducing our costs 
for processing your application or request; or
    (ii) Ask to pay us to perform, or contract for, all or part of any 
document, study, or other activity.
    (4) We will then give you the final estimate of the processing fee 
amount with payment terms and instructions after considering your 
comments and any BOEM-approved work you will do.
    (i) If we encounter higher or lower processing costs than 
anticipated, we will re-estimate our reasonable processing costs 
following the procedures in paragraphs (b)(1) through (4) of this 
section, but we will not stop ongoing processing unless you do not pay 
in accordance with paragraph (b)(5) of this section.
    (ii) Once processing is complete, we will refund to you the amount 
of money that we did not spend on processing costs.
    (5) Consistent with the payment and billing terms provided in the 
final estimate, we will periodically estimate what our reasonable 
processing costs will be for a specific period and will bill you for 
that period. Payment is due to us 30 days after you receive your bill. 
We will stop processing your document if you do not pay the bill by the 
date payment is due. If a periodic payment turns out to be more or less 
than our reasonable processing costs for the period, we will adjust the 
next billing accordingly or make a refund. Do not deduct any amount 
from a payment without our prior written approval.
    (6) You must pay the entire fee before we will issue the final 
document or take final action on your application or request.
    (7) You may appeal our estimated processing costs in accordance 
with the regulations in Sec.  585.118 and 43 CFR part 4. We will not 
process the document further until the appeal is resolved, unless you 
pay the fee under protest while the appeal is pending. If the appeal 
results in a decision changing the proposed fee, we will adjust the fee 
in accordance with this section. If we adjust the fee downward, we will 
not pay interest.


Sec.  585.113  Definitions.

    Terms used in this part have the meanings as defined in this 
section:
    Affected local government means with respect to any activities 
proposed, conducted, or approved under this part or 30 CFR part 285, 
any locality:
    (1) That is, or is proposed to be, the site of gathering, 
transmitting, or distributing electricity or other energy product, or 
is otherwise receiving, processing, refining, or transshipping product, 
or services derived from activities approved under this part or 30 CFR 
part 285;
    (2) That is used, or is proposed to be used, as a support base for 
activities approved under this part or 30 CFR part 285; or
    (3) In which there is a reasonable probability of significant 
effect on land or water uses from activities approved under this part, 
or 30 CFR part 285.
    Affected State means with respect to any activities proposed, 
conducted, or approved under this part or 30 CFR part 285, any coastal 
State--
    (1) That is, or is proposed to be, the site of gathering, 
transmitting, or distributing energy or is otherwise receiving, 
processing, refining, or transshipping products, or services derived 
from activities approved under this part or 30 CFR part 285;
    (2) That is used, or is scheduled to be used, as a support base for 
activities approved under this part or 30 CFR part 285; or
    (3) In which there is a reasonable probability of significant 
effect on land or water uses from activities approved under this part 
or 30 CFR part 285.
    Archaeological resource means any material remains of human life or 
activities that are at least 50 years of age and that are of 
archaeological interest (i.e., which are capable of providing 
scientific or humanistic understanding of past human behavior, cultural 
adaptation, and related topics through the application of scientific or 
scholarly techniques, such as controlled observation, contextual 
measurement, controlled collection, analysis, interpretation, and 
explanation).
    Best available and safest technology means the best available and 
safest technologies that BOEM determines to be economically feasible 
wherever failure of equipment would have a significant effect on 
safety, health, or the environment.
    Best management practices mean practices recognized within their 
respective industry, or by government, as one of the best for achieving 
the desired output while reducing undesirable outcomes.
    Bidding credits means the value assigned by BOEM, expressed in 
monetary terms, to the factors or actions demonstrated, or committed 
to, by a bidder at a BOEM lease auction during the competitive lease 
award process. The type(s) and value(s) of any bidding credit(s) 
awarded to any given bidder will be set forth in the Final Sale Notice.
    BOEM means Bureau of Ocean Energy Management of the Department of 
the Interior.
    BSEE means Bureau of Safety and Environmental Enforcement of the 
Department of the Interior.
    Certified Verification Agent (CVA) means an individual or 
organization, experienced in the design, fabrication, and installation 
of offshore marine facilities or structures, who will conduct specified 
third-party reviews, inspections, and verifications in accordance with 
30 CFR part 285.
    Coastal environment means the physical atmospheric, and biological 
components, conditions, and factors which interactively determine the 
productivity, state, condition, and quality of the terrestrial 
ecosystem from the shoreline inward to the boundaries of the coastal 
zone.
    Coastline means the same as the term ``coast line'' in section 2 of 
the Submerged Lands Act (43 U.S.C. 1301(c)).
    Commercial activities means, under renewable energy leases and 
grants, all activities associated with the generation, storage, or 
transmission of electricity or other energy product from a renewable 
energy project on the OCS, and for which such electricity or other 
energy product is intended for distribution, sale, or other commercial 
use, except for electricity or other energy product distributed or sold 
pursuant to technology-testing activities on a limited lease. This term 
also includes activities associated with all stages of development, 
including initial site characterization and assessment, facility 
construction, and project decommissioning.
    Commercial lease means a lease issued under this part that 
specifies the terms and conditions under which a person can conduct 
commercial activities.

[[Page 42726]]

    Commercial operations means the generation of electricity or other 
energy product for commercial use, sale, transmission, or distribution 
from a commercial lease.
    Critical Safety Systems and Equipment means safety systems and 
equipment designed to prevent or ameliorate fire, spillages, or other 
major accidents that could result in harm to health, safety, or the 
environment in the area of your facilities.
    Decommissioning means removing BOEM and BSEE approved facilities 
and returning the site of the lease or grant to a condition that meets 
the requirements under subpart I of 30 CFR part 285.
    Director means the Director of BOEM, or an official authorized to 
act on the Director's behalf.
    Distance means the minimum great circle distance.
    Eligible State means a coastal State having a coastline (measured 
from the nearest point) no more than 15 miles from the geographic 
center of a qualified project area.
    Fabrication means the cutting, fitting, welding, or other assembly 
of project elements.
    Facility means an installation that is permanently or temporarily 
attached to the seabed of the OCS. Facilities include any structures; 
devices; appurtenances; gathering, transmission, and distribution 
cables; pipelines; and permanently moored vessels. Any group of OCS 
installations interconnected with walkways, or any group of 
installations that includes a central or primary installation with one 
or more satellite or secondary installations, is a single facility. 
BOEM and BSEE may decide that the complexity of the installations 
justifies their classification as separate facilities.
    Geographic center of a project means the centroid (geometric center 
point) of a qualified project area. The centroid represents the point 
that is the weighted average of coordinates of the same dimension, with 
the weights determined by a density function. For example, in the case 
of a project area shaped as a rectangle or other parallelogram, the 
geographic center would be that point where lines between opposing 
corners intersect. The geographic center of a project could be outside 
the project area itself if that area is irregularly shaped.
    Governor means the Governor of a State or the person or entity 
lawfully designated by or under State law to exercise the powers 
granted to a Governor.
    Grant means a right-of-way or a right-of-use and easement issued 
under the provisions of this part.
    Human environment means the physical, social, and economic 
components, conditions, and factors that interactively determine the 
state, condition, and quality of living conditions, employment, and 
health of those affected, directly or indirectly, by activities 
occurring on the OCS.
    Lease means an agreement authorizing the use of a designated 
portion of the OCS for activities allowed under this part. The term 
also means the area covered by that agreement, when the context 
requires.
    Lease area means an area on the OCS that BOEM has identified for 
leasing for potential development of renewable energy resources.
    Lessee means the holder of a lease, a BOEM-approved assignee, and, 
when describing the conduct required of parties engaged in activities 
on the lease, it also refers to the operator and all persons authorized 
by the holder of the lease or operator to conduct activities on the 
lease.
    Limited lease means a lease issued under this part that specifies 
the terms and conditions under which a person may conduct activities on 
the OCS that support the production of energy, but do not result in the 
production of electricity or other energy product for sale, 
distribution, or other commercial use exceeding a limit specified in 
the lease.
    Marine environment means the physical, atmospheric, and biological 
components, conditions, and factors that interactively determine the 
productivity, state, condition, and quality of the marine ecosystem. 
These include the waters of the high seas, the contiguous zone, 
transitional and intertidal areas, salt marshes, and wetlands within 
the coastal zone and on the OCS.
    Miles means nautical miles, as opposed to statute miles.
    Multiple factor auction means an auction that involves the use of 
bidding credits to incentivize goals or actions that support public 
policy objectives or maximize public benefits through the competitive 
leasing auction process. For any multiple factor auction, the monetary 
value of the bidding credits, if any, would be added to the value of 
the cash bid to determine the highest bidder.
    Natural resources include, without limiting the generality thereof, 
renewable energy, oil, gas, and all other minerals (as defined in 
section 2(q) of the OCS Lands Act), and marine animal and marine plant 
life.
    Operator means the individual, corporation, or association having 
control or management of activities on the lease or grant under this 
part. The operator may be a lessee, grant holder, or a contractor 
designated by the lessee or holder of a grant issued under this part.
    Outer Continental Shelf (OCS) means all submerged lands lying 
seaward and outside of the area of lands beneath navigable waters, as 
defined in section 2 of the Submerged Lands Act (43 U.S.C. 1301), whose 
subsoil and seabed appertain to the United States and are subject to 
its jurisdiction and control or within the exclusive economic zone of 
the United States and adjacent to any territory of the United States 
and does not include any area conveyed by Congress to a territorial 
government for administration.
    Person means, in addition to a natural person, an association 
(including partnerships and joint ventures); a Federal agency; a State; 
a political subdivision of a State; a Native American Tribal 
government; or a private, public, or municipal corporation.
    Project, for the purposes of defining the source of revenues to be 
shared, means a lease, ROW, RUE, or Alternate Use RUE on which the 
activities authorized under this part and/or 30 CFR part 285 or 586 are 
conducted on the OCS. The term ``project'' may be used elsewhere in 
this part to refer to these same authorized activities, the facilities 
used to conduct these activities, or to the geographic area of the 
project, i.e., the project area.
    Project area means the geographic surface leased, or granted, for 
the purpose of a specific project. If OCS acreage is granted for a 
project under some form of agreement other than a lease (i.e., a ROW or 
RUE), the Federal acreage granted would be considered the project area. 
To avoid distortions in the calculation of the geometric center of the 
project area, project easements issued under this part are not 
considered part of the qualified project's area.
    Project Design Envelope (PDE) means a reasonable range of design 
parameters proposed in a lessee's plan for components of the project, 
such as type, dimensions, and number of wind turbine generators; 
foundation type; location of the export cable route; location of an 
onshore substation; location of the grid connection point; and 
construction methods and timing.
    Project easement means an easement to which, upon approval of your 
Construction and Operations Plan (COP) or General Activities Plan 
(GAP), you are entitled as part of the lease for the purpose of 
installing, maintaining, repairing and replacing: gathering,

[[Page 42727]]

transmission, and distribution, and inter-array cables; power and 
pumping stations; facility anchors; pipelines; and associated 
facilities and other appurtenances on the OCS as necessary for the full 
enjoyment of the lease.
    Provisional winner means a bidder that BOEM determines at the 
conclusion of the auction to have submitted the winning bid. The 
provisional winner becomes the winning bidder after the favorable 
completion of BOEM's bid review, Department of Justice antitrust 
review, bidder obligations under Sec.  585.225(b), and any appeals 
process under Sec.  585.118(c).
    Receipt, as used in this part to describe the time when a document 
is received by any party in the absence of documentation to the 
contrary, is deemed to have taken place:
    (1)(i) Five (5) business days after the date the document was given 
to the U.S. Postal Service (or deposited in one of its mailboxes), 
properly addressed and with proper postage affixed, or was given to a 
delivery service (or deposited in one of its receptacles), properly 
addressed and with the delivery cost prepaid; or
    (ii) On the date on which the document was properly addressed and 
sent electronically.
    (2) This definition also applies to variants of the words 
``receipt'' and ``receive'' where those terms are used in this part to 
describe the receipt of a document when the timing of receipt triggers 
a regulatory time period or consequence.
    Renewable Energy means energy resources other than oil and gas and 
minerals as defined in 30 CFR part 580. Such resources include, but are 
not limited to, wind, solar, and ocean waves, tides, and current.
    Revenues mean bonuses, rents, operating fees, and similar payments 
made in connection with a project or project area. It does not include 
administrative fees such as those assessed for cost recovery, civil 
penalties, and forfeiture of financial assurance.
    Right-of-use and easement (RUE) grant means an easement issued by 
BOEM under this part that authorizes use of a designated portion of the 
OCS to support activities on a lease or other use authorization for 
renewable energy activities. The term also means the area covered by 
the authorization.
    Right-of-way (ROW) grant means an authorization issued by BOEM 
under this part to use a portion of the OCS for the construction and 
use of a cable or pipeline for the purpose of gathering, transmitting, 
distributing, or otherwise transporting electricity or other energy 
product generated or produced from renewable energy, but does not 
constitute a project easement under this part. The term also means the 
area covered by the authorization.
    Secretary means the Secretary of the Interior or an official 
authorized to act on the Secretary's behalf.
    Significant archaeological resource means an archaeological 
resource that meets the criteria of significance for eligibility for 
listing in the National Register of Historic Places, as defined in 36 
CFR 60.4.
    Site assessment activities mean those initial activities conducted 
to assess an area on the OCS, such as resource assessment surveys 
(e.g., meteorological and oceanographic) or technology testing, 
involving the installation of bottom-founded facilities.
    We, us, and our refer to BOEM, or its possessive, depending on the 
context.
    You and your means an applicant, lessee, the operator, or 
designated operator, ROW grant holder or RUE grant holder under this 
part, or the designated agent of any of these, or the possessive of 
each, depending on the context. The terms you and your also include 
contractors and subcontractors of the entities specified in the 
preceding sentence.


Sec.  585.114  How will data and information obtained by BOEM under 
this part be disclosed to the public?

    (a) BOEM will make data and information available in accordance 
with the requirements and subject to the limitations of the Freedom of 
Information Act (FOIA) (5 U.S.C. 552) and the regulations contained in 
43 CFR part 2.
    (b) BOEM will not release such data and information that we have 
determined is exempt from disclosure under exemption 4 of FOIA. We will 
review such data and information and objections of the submitter by the 
following schedule to determine whether release at that time will 
result in substantial competitive harm or disclosure of trade secrets.

------------------------------------------------------------------------
                                     Then BOEM will review data and
     If you have a . . .           information for possible release:
------------------------------------------------------------------------
(1) Commercial lease.........  At the earlier of:
                               (i) 3 years after the commencement of
                                commercial operations; or
                               (ii) 3 years after the lease terminates.
(2) Limited lease............  At 3 years after the lease terminates.
(3) ROW or RUE grant.........  At the earliest of:
                               (i) 10 years after the approval of the
                                grant;
                               (ii) Grant termination; or
                               (iii) 3 years after the completion of
                                construction activities.
------------------------------------------------------------------------

    (c) After considering any objections from the submitter, if we 
determine that release of such data and information will result in:
    (1) No substantial competitive harm or disclosure of trade secrets, 
then the data and information will be released.
    (2) Substantial competitive harm or disclosure of trade secrets, 
then the data and information will not be released at that time but 
will be subject to further review every 3 years thereafter.


Sec.  585.115  Paperwork Reduction Act statements--information 
collection.

    (a) The Office of Management and Budget (OMB) has approved the 
information collection requirements in this part under 44 U.S.C. 3501, 
et seq., and assigned OMB Control Number 1010-0176. The table in 
paragraph (e) of this section lists the subparts in the rule requiring 
the information and its title, summarizes the reasons for collecting 
the information, and summarizes how BOEM uses the information.
    (b) Respondents are primarily renewable energy applicants, lessees, 
ROW grant holders, RUE grant holders, Alternate Use RUE grant holders, 
and operators. The requirement to respond to the information collection 
in this part is mandated under subsection 8(p) of the OCS Lands Act. 
Some responses are also required to obtain or retain a benefit or may 
be voluntary.
    (c) The Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.) 
requires us to inform the public that an agency may not conduct or 
sponsor, and you are not

[[Page 42728]]

required to respond to, a collection of information unless it displays 
a currently valid OMB control number.
    (d) Comments regarding any aspect of the collections of information 
under this part, including suggestions for reducing the burden, should 
be sent to the Information Collection Clearance Officer, Bureau of 
Ocean Energy Management, 45600 Woodland Road, Sterling, VA 20166.
    (e) BOEM is collecting this information for the reasons given in 
the following table:

------------------------------------------------------------------------
                                 Reasons for collecting information and
 30 CFR 585 subpart and title                   how used
------------------------------------------------------------------------
(1) Subpart A--General         To inform BOEM of actions taken to comply
 Provisions.                    with general operational requirements on
                                the OCS. To ensure that operations on
                                the OCS meet statutory and regulatory
                                requirements, are safe and protect the
                                environment, and result in diligent
                                development on OCS leases.
(2) Subpart B--The Renewable   To enable BOEM to publish a proposed five-
 Energy Leasing Schedule.       year leasing schedule for the OCS
                                renewable energy program.
(3) Subpart C--Issuance of     To provide BOEM with information needed
 OCS Renewable Energy Leases.   to determine when to use a competitive
                                process for issuing a renewable energy
                                lease, to identify auction formats and
                                bidding systems and variables that we
                                may use when that determination is
                                affirmative, and to determine the terms
                                under which we will issue renewable
                                energy leases.
(4) Subpart D--ROW Grants and  To issue ROW grants and RUE grants for
 RUE Grants for Renewable       OCS renewable energy activities that are
 Energy Activities.             not associated with a BOEM-issued
                                renewable energy lease.
(5) Subpart E--Lease and       To ensure compliance with regulations
 Grant Administration.          pertaining to a lease or grant,
                                including designation of operator,
                                assignment, segregation, consolidation,
                                suspension, renewal, termination,
                                relinquishment, and cancellation.
(6) Subpart F--Payments and    To ensure that payments and financial
 Financial Assurance            assurance payments for renewable energy
 Requirements.                  leases comply with subpart E.
(7) Subpart G--Plans and       To enable BOEM to comply with the
 Information Requirements.      National Environmental Policy Act (NEPA)
                                (42 U.S.C. 4321 et seq.), the Coastal
                                Zone Management Act (CZMA) (16 U.S.C.
                                1451 et seq.), and other Federal laws
                                and to ensure the safety of the
                                environment on the OCS.
------------------------------------------------------------------------

Sec.  585.116  Requests for information.

    BOEM may publish a request for information (RFI) in the Federal 
Register for the following reasons:
    (a) To solicit information from industry, federally recognized 
Tribes, State and local agencies, and other interested entities for 
evaluating the offshore renewable energy industry, including the 
identification of potential challenges or obstacles to its continued 
development. An RFI may relate to the identification of environmental, 
technical, regulatory, or economic matters that promote or detract from 
continued development of renewable energy technologies on the OCS. BOEM 
may use the information received to refine its renewable energy 
program, including to facilitate OCS renewable energy development in a 
safe and environmentally responsible manner and to ensure a fair return 
to the United States for use of the OCS.
    (b) To assess interest in leasing all or part of the OCS for 
activities authorized in this part.
    (c) To determine whether there is competitive interest in a 
specific OCS renewable energy proposal received by BOEM, such as an 
unsolicited request for a lease under Sec.  585.231(b) or a RUE or ROW 
grant under Sec.  585.307(a).
    (d) To seek other information that BOEM needs for this program.


Sec.  585.117  Severability.

    If a court holds any provisions of this part or their applicability 
to any persons or circumstances invalid, the remainder of the 
provisions and their applicability to any persons or circumstances will 
not be affected.


Sec.  585.118  What are my appeal rights?

    (a) Except as stated in paragraph (c) of this section, any party 
adversely affected by a final decision issued by BOEM under this part 
may appeal that decision to the Interior Board of Land Appeals (IBLA), 
under 30 CFR part 590 and 43 CFR part 4, subpart E.
    (b) Any final decision will remain in full force and effect during 
the pendency of an appeal unless a stay is granted under 43 CFR part 4.
    (c) A bidder adversely affected by BOEM's determination of a 
provisional winner made under this part may appeal to the BOEM 
Director, but decisions determining a provisional winner may not be 
appealed to the IBLA.
    (1) A bidder that elects to appeal a provisional winner selection 
decision must file a written appeal with the Director within 15 
business days after receipt of the decision.
    (2) Such appeal must be accompanied by a statement of reasons. 
Before reversing a provisional winner selection decision, the Director 
will provide the provisional winner a reasonable opportunity to respond 
in writing to the appellant's statement of reasons. The Director will 
issue a written determination either affirming or reversing the 
decision. The Director's decision is not appealable to the IBLA under 
this section.
    (3) BOEM will not execute a lease or grant until the 15-business-
day appeal period closes and all timely filed appeals are resolved.
    (4) The review authority of the Office of Hearings and Appeals does 
not apply to either the provisional winner selection decisions made 
under this part or the Director's final determination affirming or 
reversing a provisional winner selection decision.


Sec. Sec.  585.119-585.149  [Reserved]

0
46. Revise subpart B to read as follows:

Subpart B--The Renewable Energy Leasing Schedule

Sec.
585.150 What is the Renewable Energy Leasing Schedule?
585.151-585.199 [Reserved]

Subpart B--The Renewable Energy Leasing Schedule


Sec.  585.150  What is the Renewable Energy Leasing Schedule?

    At least once every 2 years, the Secretary will publish a schedule 
with a list of locations under consideration for leasing, along with a 
projection of when lease sales are anticipated to occur for the 5-year 
period following the schedule's publication. This schedule will include 
a general description of the area covered by each proposed lease sale, 
the calendar year in which each lease sale is projected to occur, and 
the reasons for any changes made to the previous schedule. Any proposed 
lease sale covered by the schedule will be subject to all applicable 
regulations, including area identification,

[[Page 42729]]

coordination with relevant parties, and applicable environmental 
reviews.


Sec. Sec.  585.151-585.199  [Reserved]

0
47. Revise subpart C to read as follows:

Subpart C--Issuance of OCS Renewable Energy Leases

Sec.

General Lease Information

585.200 What rights are granted with a lease issued under this part?
585.201 How will BOEM issue leases?
585.202 What types of leases will BOEM issue?
585.203 With whom will BOEM consult before issuance of leases?
585.204 What areas are available for leasing consideration?
585.205 How will leases be mapped?
585.206 What is the lease size?
585.207-585.209 [Reserved]

Competitive Lease Award Process--Pre-Auction Provisions

585.210 What are the steps in BOEM's competitive lease award 
process?
585.211 What is the Call?
585.212 What is area identification?
585.213 What information is included in the PSN?
585.214 What information is included in the FSN?
585.215 What may BOEM do to assess whether competitive interest for 
a lease area still exists before the auction?
585.216 How are bidding credits awarded and used?
585.217-585.219 [Reserved]

Competitive Lease Award Process--Auction Provisions

585.220 How will BOEM award leases competitively?
585.221 What general provisions apply to all auctions?
585.222 What other auction rules must bidders follow?
585.223 What supplemental information will BOEM provide in a PSN and 
FSN?

Competitive Lease Award Process--Post-Auction Provisions

585.224 What will BOEM do after the auction?
585.225 What happens if BOEM accepts a bid?
585.226 What happens if the provisional winner fails to meet its 
obligations?
585.227-585.229 [Reserved]

Noncompetitive Lease Award Process

585.230 May I request a lease if there is no Call?
585.231 Will BOEM issue leases noncompetitively?
585.232 May I acquire a lease noncompetitively after responding to a 
request for information or a Call for Information and Nominations?
585.233-585.234 [Reserved]

Commercial and Limited Lease Periods

585.235 What are the lease periods for a commercial lease?
585.236 If I have a limited lease, how long will my lease remain in 
effect?
585.237 What is the effective date of a lease?
585.238 May I develop my commercial lease in phases?
585.239 Are there any other renewable energy research activities 
that will be allowed on the OCS?
585.240-585.299 [Reserved]

Subpart C--Issuance of OCS Renewable Energy Leases

General Lease Information


Sec.  585.200  What rights are granted with a lease issued under this 
part?

    (a) A lease issued under this part grants the lessee the right, 
subject to obtaining the necessary approvals, including but not limited 
to those required under the FERC hydrokinetic licensing process, and 
complying with all provisions of this part, to occupy, and install and 
operate facilities on, a designated portion of the OCS for the purpose 
of conducting:
    (1) Commercial activities; or
    (2) Other limited activities that support, result from, or relate 
to the production of energy from a renewable energy source.
    (b) A lease issued under this part confers on the lessee the right 
to one or more project easements without further competition for the 
purpose of installing gathering, transmission, and distribution cables; 
pipelines; and appurtenances on the OCS as necessary for the full 
enjoyment of the lease.
    (1) You must apply for the project easement as part of your COP or 
GAP, as provided under subpart G of this part; and
    (2) BOEM will incorporate your approved project easement in your 
lease as an addendum.
    (c) A commercial lease issued under this part may be developed in 
phases, with BOEM approval as provided in Sec.  585.238.


Sec.  585.201  How will BOEM issue leases?

    BOEM will issue leases on a competitive basis, as provided under 
Sec. Sec.  585.210 through 585.226. However, if we determine after 
public notice of a proposed lease that there is no competitive 
interest, we will issue leases noncompetitively, as provided under 
Sec. Sec.  585.230 through 585.232. We will issue leases on forms 
approved by BOEM and will include terms, conditions, and stipulations 
identified and developed as appropriate.


Sec.  585.202  What types of leases will BOEM issue?

    BOEM may issue commercial or limited leases for OCS activities 
under Sec.  585.104. BOEM may issue a lease for OCS renewable energy 
research activities under Sec.  585.239.


Sec.  585.203  With whom will BOEM consult before issuance of leases?

    For leases issued under this part, through either the competitive 
or noncompetitive process, BOEM, prior to issuing the lease, will 
coordinate and consult with relevant Federal agencies (including, in 
particular, those agencies involved in planning activities that are 
undertaken to avoid or minimize conflicts among users and maximize the 
economic and ecological benefits of the OCS, including multifaceted 
spatial planning efforts), any affected federally recognized Indian 
Tribes, the Native Hawaiian Community or Alaska Native Corporations, as 
appropriate, the Governor of any affected State, and the executive of 
any affected local government, as directed by subsections 8(p)(4) and 
(7) of the OCS Lands Act or other relevant Federal laws. Federal 
statutes that require BOEM to consult with interested parties or 
Federal agencies or to respond to findings of those agencies include 
the Endangered Species Act (ESA) and the Magnuson-Stevens Fishery 
Conservation and Management Act. BOEM also engages in consultation with 
Tribal and State historic preservation officers pursuant to the 
National Historic Preservation Act (NHPA).


Sec.  585.204   What areas are available for leasing consideration?

    BOEM may offer any appropriately platted area of the OCS, as 
provided in Sec.  585.205, for a renewable energy lease, except any 
area within the exterior boundaries of any unit of the National Park 
System, National Wildlife Refuge System, National Marine Sanctuary 
System, or any National Monument.


Sec.  585.205  How will leases be mapped?

    BOEM will prepare leasing maps and official protraction diagrams of 
areas of the OCS. The areas included in each lease will be in 
accordance with the appropriate leasing map or official protraction 
diagram.


Sec.  585.206  What is the lease size?

    (a) BOEM will determine the size for each lease based on the area 
required to accommodate the anticipated activities. The processes 
leading to both competitive and noncompetitive issuance of leases will 
provide public notice of the lease size adopted. We will delineate 
leases by using mapped OCS

[[Page 42730]]

blocks or portions, or aggregations of blocks.
    (b) The lease size includes the minimum area that will allow the 
lessee sufficient space to develop the project and manage activities in 
a manner that is consistent with the provisions of this part and 30 CFR 
part 285. The lease may include whole lease blocks or portions of a 
lease block.


Sec. Sec.  585.207-585.209  [Reserved]

Competitive Lease Award Process--Pre-Auction Provisions


Sec.  585.210  What are the steps in BOEM's competitive lease award 
process?

    (a) BOEM may publish an RFI under Sec.  585.116.
    (b) BOEM will award leases through a competitive lease award 
process unless competitive interest does not exist. BOEM will publish 
details for each auction and lease through appropriate notices in the 
Federal Register. Each competitive lease award process will include the 
following steps:
    (1) Call for information and nominations (Call). BOEM will publish 
a Call in the Federal Register requesting information to determine 
qualifications of prospective bidders and interest in preliminarily 
identified OCS lease areas.
    (2) Area identification. BOEM will identify OCS areas for leasing 
consideration and related analysis in consultation with appropriate 
Federal agencies, State and local governments, federally recognized 
Tribes, Alaska Native Claims Settlement Act (ANCSA) corporations, and 
other interested parties.
    (3) Proposed Sale Notice (PSN). BOEM will publish a PSN, or a 
notice of its availability, in the Federal Register, announcing BOEM's 
intention to conduct an auction for prospective lease areas. The PSN 
will set forth provisions and information concerning the proposed 
auction and lease and will invite stakeholder comments.
    (4) Final Sale Notice (FSN). BOEM will publish an FSN, or a notice 
of its availability, in the Federal Register setting forth final 
information concerning the auction and lease.
    (5) Auction. BOEM will hold an auction under the regulations in 
this part and the FSN.
    (6) Lease award. BOEM will award leases subsequent to the 
completion of the aforementioned steps under the regulations in this 
part and the FSN.


Sec.  585.211  What is the Call?

    (a) The Call is a notice that BOEM will publish in the Federal 
Register requesting responses from stakeholders interested in bidding 
on designated OCS areas and comments from interested and potentially 
affected parties. The responses may inform the area identification 
process and will enable BOEM to determine whether there exists 
competitive interest in the proposed lease area. BOEM may request 
additional information from stakeholders related to environmental, 
economic, and other issues.
    (b) The Call may include the following:
    (1) The areas that BOEM has preliminarily identified for leasing 
consideration;
    (2) A request for comments concerning geological conditions; 
archaeological sites on the seabed or nearshore; multiple uses of the 
proposed leasing area (including, for example, navigation, recreation, 
military, and fisheries); and other socioeconomic, biological, and 
environmental information;
    (3) Request for comments regarding feasibility for development, 
including the energy resource and opportunity for grid connection;
    (4) Possible lease terms and conditions;
    (5) A request to potential bidders to nominate one or more areas 
for a commercial renewable energy lease within the preliminarily 
identified leasing areas. Such nominations must include:
    (i) The specific OCS blocks that the respondent is interested in 
leasing;
    (ii) A general description of the respondent's objectives and how 
respondent proposes to achieve those objectives;
    (iii) A preliminary schedule of the respondent's proposed 
activities, including those potentially leading to commercial 
operations, to the extent known;
    (iv) Information regarding respondent's coordination, or intent to 
coordinate, with any other entity for the purposes of acquiring a lease 
from BOEM, if applicable;
    (v) Documentation demonstrating the respondent's qualification to 
acquire a lease or grant as specified in Sec. Sec.  585.107 and 
585.108;
    (vi) Available and pertinent information concerning renewable 
energy and environmental conditions in the nominated areas, including 
energy and resource data and information used to evaluate the areas; 
and
    (vii) Any additional information requested by BOEM in the Call;
    (c) Respondents have 45 calendar days from the date the Call is 
published in the Federal Register to reply, unless BOEM specifies 
another time period of not less than 30 calendar days in the Call.
    (d) BOEM may use the information received in response to a Call to:
    (1) Identify lease areas;
    (2) Develop options for its lease provisions (e.g., stipulations, 
payments, terms, and conditions);
    (3) Inform its environmental analysis conducted under applicable 
Federal requirements, including, but not limited to, NEPA, the 
Endangered Species Act (ESA) (16 U.S.C. 1531-1544), and the CZMA; and
    (4) Determine whether competitive interest exists in all or a 
portion of any potential lease area. If BOEM determines no competitive 
interest exists, BOEM may follow the noncompetitive leasing process set 
forth in Sec.  585.231(d) through (j).


Sec.  585.212  What is area identification?

    (a) Area identification is the process by which BOEM delineates one 
or more OCS areas for leasing consideration and environmental analysis 
if the areas appear appropriate for renewable energy development. This 
process is based on an area's relevant attributes, such as other uses 
of the area, environmental factors or characteristics, stakeholder 
comments, industry nominations, feasibility for development, and other 
relevant information. BOEM consults with interested parties during this 
process as specified in Sec.  585.210(b)(2).
    (b) BOEM may consider areas nominated by respondents to a Call and 
other areas determined appropriate for leasing.
    (c) For the identified areas, BOEM will evaluate:
    (1) The potential effects of leasing the identified areas on the 
human, marine, and coastal environments;
    (2) The feasibility of development; and
    (3) Potential measures, including lease stipulations, to mitigate 
potential adverse impacts. Such measures are identified and refined 
through the area identification process, as well as through 
environmental review and consultations and published for comment in the 
Proposed Sale Notice.
    (d) BOEM may hold public hearings on the environmental analyses 
associated with leasing the identified areas, after appropriate notice.
    (e) At the end of the area identification, BOEM may offer selected 
areas for leasing.


Sec.  585.213  What information is included in the PSN?

    (a) The PSN is a notice that BOEM will publish in the Federal 
Register for each prospective auction. The PSN will

[[Page 42731]]

request public comment on the items listed in this section. Public 
comments will inform BOEM's decisions regarding auction format and 
lease terms and conditions. At a minimum, the PSN will include or 
describe the availability of information pertaining to:
    (1) The proposed leases to be offered, including:
    (i) The proposed lease areas, including size and location;
    (ii) The proposed lease terms and conditions, including the 
proposed rental rate and operating fee rate;
    (iii) Other proposed payment requirements, as applicable; and
    (iv) Proposed requirements for performance under the lease, such as 
site-specific lease stipulations and environmental mitigation measures;
    (2) Steps a bidder must take to obtain and maintain eligibility to 
participate in the auction (e.g., financial forms, bid deposits);
    (3) The proposed availability and potential value of bidding 
credit(s), if any are offered, and the actions or commitments required 
to obtain them;
    (4) A detailed description of the proposed auction format and 
procedures as further described in Sec.  585.223;
    (5) The maximum number or specific sets of lease areas that any 
given bidder may be allowed to bid on or to acquire in an auction, if 
applicable;
    (6) Lease award procedures, including how and when a lease will be 
awarded and executed, and how BOEM will address unsuccessful bids and 
applications;
    (7) A copy of, or a reference to, the official BOEM lease form; and
    (8) Other relevant matters, as determined by BOEM.
    (b) The PSN may be used to gauge competitive interest by requiring 
prospective bidders to reaffirm their intent to participate in the 
auction as a prerequisite for continued eligibility.
    (c) A prospective bidder is encouraged to identify in its comments 
any specific proposed terms and conditions in the PSN that may preclude 
its participation in the auction.
    (d) The PSN's public comment period is 60 calendar days from the 
date of its publication in the Federal Register, unless BOEM specifies 
another time period of not less than 30 calendar days in the PSN.
    (e) BOEM will notify any potentially affected federally recognized 
Indian Tribes, States, local governments, and ANCSA corporations of the 
PSN's publication, and will provide copies of the PSN to these entities 
upon written request.


Sec.  585.214  What information is included in the FSN?

    (a) The FSN is a notice that BOEM will publish in the Federal 
Register at least 30 calendar days before each prospective auction. The 
FSN will describe the final auction details and will include or 
describe the availability of information pertaining to:
    (1) The leases to be offered, including:
    (i) The lease areas, including size and location;
    (ii) Lease terms and conditions, including the rental rate and the 
operating fee rate;
    (iii) Other payment requirements, as applicable; and
    (iv) Requirements for performance under the lease, including site-
specific lease stipulations and environmental mitigation measures;
    (2) Steps a bidder must take to ensure eligibility to participate 
in the auction (e.g., financial forms, bid deposits);
    (3) The availability and potential value of bidding credit(s), if 
any are offered, and the actions or commitments required to obtain 
them.
    (4) A detailed description of the auction format and procedures as 
further described in Sec.  585.223;
    (5) The maximum number or specific sets of lease areas that any 
given bidder may be allowed to bid on or to acquire in an auction, if 
applicable;
    (6) Lease award procedures, including how and when a lease will be 
awarded and executed, and how BOEM will handle unsuccessful bids and 
applications;
    (7) A copy of, or a reference to, the official BOEM lease form; and
    (8) Other relevant matters as determined by BOEM.
    (b) The terms of the FSN may differ from the proposed terms of the 
PSN.


Sec.  585.215  What may BOEM do to assess whether competitive interest 
for a lease area still exists before the auction?

    (a) At any time BOEM has reason to believe that competitive 
interest in any lease area no longer exists before the area's auction, 
BOEM may issue a notice in the Federal Register, as described in Sec.  
585.116, requesting information regarding competitive interest in that 
area. BOEM will consider respondents' comments to determine whether 
competitive interest in that area remains. BOEM may decide to end the 
competitive process for any area if it determines that competitive 
interest no longer exists.
    (b) If BOEM determines after considering respondents' comments to 
such a notice that competitive interest remains, BOEM will continue 
with the competitive process set forth in Sec. Sec.  585.210 through 
585.226.
    (c) If BOEM determines at any time before the auction that only a 
single party remains interested in a lease area, BOEM may proceed 
either with the auction or with the noncompetitive process set forth in 
Sec.  585.231(d) through (j) following payment by that party of the 
acquisition fee specified in Sec.  585.502(a).


Sec.  585.216  How are bidding credits awarded and used?

    (a) BOEM will determine the highest bid, taking into account the 
combined value of the monetary (cash) component and the non-monetary 
component(s), represented by bidding credits. The PSN and FSN will 
explain the following details, if bidding credit(s) are available for 
that auction:
    (1) Eligibility and application requirements;
    (2) The value of each available bidding credit, which will be 
either a sum certain or a percentage of the bid; and
    (3) Procedures for applying each available bidding credit to bids 
submitted during the auction.
    (b) Eligibility for bidding credits must be established in advance 
of any lease auction, in accordance with the specifications of the FSN. 
Such eligibility may be based on actions that the bidder has already 
undertaken or actions that it has committed to undertake in the future, 
provided that BOEM has agreed to the terms by which such a commitment 
will be made. BOEM may offer bidding credits for any of the following:
    (1) Power purchase agreements;
    (2) Eligibility for, or applicability of, renewable energy credits 
or subsidies;
    (3) Development agreements by a potential lessee that facilitate 
shared transmission solutions and grid interconnection;
    (4) Technical merit, timeliness, or financing and economic 
considerations;
    (5) Environmental considerations, public benefits, or compatibility 
with State and local needs;
    (6) Agreements or commitments by the developer that would 
facilitate OCS renewable energy development or other OCSLA goals; or
    (7) Any other factor or criteria to further development of offshore 
renewable energy, as identified by BOEM in the PSN and FSN.
    (c) Before the auction, bidders seeking to use bidding credits must 
establish that they meet the eligibility criteria for each bidding 
credit according to the FSN provisions.
    (d) Before the auction, BOEM will determine each bidder's 
eligibility for bidding credits, and the value of those

[[Page 42732]]

bidding credits, and will inform each eligible bidder of the value of 
the bidding credits to which it may be entitled.
    (e) A provisional winner who is awarded bidding credits must pay an 
amount equal to the cash component of its winning bid less any bid 
deposit retained by BOEM under Sec.  585.501.


Sec. Sec.  585.217-585.219   [Reserved]

Competitive Lease Award Process--Auction Provisions


Sec.  585.220  How will BOEM award leases competitively?

    (a) BOEM will award leases competitively using an objective, fair, 
reasonable, and competitive auction process that provides a fair return 
to the United States. As described in the FSN, leases will be awarded 
to the highest bidder.
    (b) BOEM may use any analog or digital method to conduct the 
auction. The specific process and procedural details for each auction 
will be noticed in the PSN and finalized in the FSN.


Sec.  585.221  What general provisions apply to all auctions?

    (a) If BOEM determines competitive interest exists to develop a 
renewable energy resource in any OCS area and decides to issue a lease 
for that area, BOEM will conduct an auction to award the lease.
    (b) The auction's format, procedures, and other details will be 
specified in the FSN, as outlined in Sec.  585.214. Possible auction 
formats include, but are not limited to, sealed bidding and ascending 
bidding.
    (c) The FSN will specify the potential use of alternatives if the 
primary auction method, system, or mechanism malfunctions. 
Alternatively, BOEM may take action consistent with paragraph (d) of 
this section until the malfunction is resolved.
    (d) Any time before a provisional winner is determined, BOEM may 
delay, suspend, or cancel an auction due to a natural or man-made 
disaster, technical malfunction, security breach, unlawful bidding 
activity, administrative necessity, or any other reason that BOEM 
determines may adversely affect the fair and efficient conduct of the 
auction. In its discretion, BOEM may restart the auction at whatever 
point it deems appropriate, reasonable, fair, and efficient for all 
participants; or, alternatively, BOEM may cancel the auction in its 
entirety.
    (e) BOEM will determine the provisional winner for each lease area 
under the auction rules and bidding procedures prescribed in the FSN.


Sec.  585.222  What other auction rules must bidders follow?

    (a) Bidders must submit a deposit to participate in an auction 
under Sec.  585.501(a), unless otherwise specified in the FSN. A 
provisional winner's bid deposit will be credited toward the balance 
due on its bid.
    (b) Only bidders qualified by BOEM under Sec. Sec.  585.107 and 
585.108 are permitted to bid during an auction.
    (c) Only an authorized agent may act on a bidder's behalf during an 
auction. Bidders must submit the names of their authorized agents to 
BOEM before the auction, as prescribed in the FSN.
    (d) Each bidder must follow the auction process specified in the 
FSN and may not take any action to disrupt or alter the process beyond 
its intended function.
    (e) A bidder is responsible for immediately contacting BOEM if it 
is unable to submit its bid for any reason during an auction. If a 
bidder fails to timely notify BOEM of its inability to bid, it may not 
dispute the auction or lease award on that basis. If a bidder timely 
notifies BOEM of its inability to submit a bid, BOEM, in its 
discretion, may suspend the auction, continue the auction using an 
alternative method, or continue the auction without the participation 
of the affected bidder.


Sec.  585.223  What supplemental information will BOEM provide in a PSN 
and FSN?

    (a) In addition to the information described in Sec. Sec.  585.213 
and 585.214, BOEM may provide the following auction information, as 
appropriate, in the PSN and FSN:
    (1) Bidding instructions, procedures, and systems, including the 
bid variables. How the auction will be conducted and what systems and 
procedures will be utilized.
    (2) Bid deposit. The amount a bidder must pay under Sec.  
585.501(a) to be eligible to bid. The FSN will prescribe the process 
and deadline for submitting a bid deposit.
    (3) Mock auction. Notice of a practice auction before the actual 
auction. Only bidders eligible for the actual auction will be permitted 
to participate in the mock (i.e., practice) auction.
    (4) Auction date, starting time and location. The starting time 
will include the relevant time zone, and the location will indicate 
where the auction will take place.
    (5) Minimum bid. The price at which the bidding will start.
    (6) Information BOEM will release to bidders between rounds. This 
information may include prior round results and other updates.
    (7) Tie-breaking provision. This provision describes the method 
that BOEM will use to break a tie between two or more identical high 
bids offered for the same lease area, or package of lease areas.
    (8) Next highest bidder. The method that BOEM will use to determine 
the next highest bidder of a completed auction in the event the 
provisional winner fails to meet its obligations or is unable to 
acquire a lease for any reason, or if a competitively issued lease or 
any portion thereof is relinquished or cancelled within six months of 
the auction.
    (b) The list in paragraph (a) of this section is not exhaustive. 
BOEM may include in the FSN any other information relevant to that 
auction.

Competitive Lease Award Process--Post-Auction Provisions


Sec.  585.224  What will BOEM do after the auction?

    (a) At the conclusion of the auction, BOEM will:
    (1) Declare the bidding closed.
    (2) Assess whether the bids meet the requirements of BOEM's 
regulations and the FSN. BOEM may disqualify bids based on this review.
    (3) Under 43 U.S.C. 1337(c), provide the Department of Justice, in 
consultation with the Federal Trade Commission, the opportunity to 
conduct an antitrust review of the lease sale results. BOEM may 
disqualify bids based on the results of this review.
    (4) BOEM will declare the provisional winner of each lease area.
    (b) BOEM may reject any and all bids received, regardless of the 
amount offered.
    (c) BOEM will accept or reject bids within 90 calendar days of 
auction closure; BOEM may extend that time by notice to bidders within 
15 calendar days before the 90 calendar day period ends.
    (d) BOEM will deem rejected any bid not accepted within the 90 
calendar-day period, or any extension. BOEM will provide each rejected 
bidder a written explanation for the rejection and will refund, without 
interest, any monies deposited by the rejected bidder.
    (e) BOEM may withdraw all or part of a lease area from the lease 
sale between auction closure and lease execution. In the event that a 
portion of the lease area is withdrawn, the provisional winner has the 
option to refuse the lease without penalty, to propose new lease terms 
for BOEM's concurrence, or to accept the lease with the reduced area.
    (f) BOEM may re-auction any lease area or portions thereof that 
remain unsold at the conclusion of an auction. BOEM may restart the 
competitive

[[Page 42733]]

leasing process at any point in the process set forth in Sec.  585.210 
that it deems reasonable and appropriate (e.g., Call, area 
identification, PSN, or FSN).


Sec.  585.225  What happens if BOEM accepts a bid?

    (a) BOEM will identify and notify the lease area's provisional 
winner of the amount due on each winning bid, which equals the cash 
component of the provisional winner's bid less its bid deposit retained 
by BOEM under Sec.  585.501. BOEM will provide an unsigned copy of the 
lease to the provisional winner.
    (b) Within 10 business days after receipt of the unsigned copy, or 
as otherwise specified by BOEM under paragraph (d) of this section, the 
provisional winner must:
    (1) Execute the lease and return it to BOEM;
    (2) File financial assurance as required by Sec. Sec.  585.516 
through 585.529; and
    (3) Pay the amount due.
    (c) When the bid deposit exceeds the amount due, BOEM will refund 
the overage without interest.
    (d) A provisional winner may request in writing an extension of the 
10-day time limit in paragraph (b) of this section. BOEM, in its 
discretion, may grant such a request.
    (e) BOEM will execute the lease by signing the lease on behalf of 
the United States only after the provisional winner completes the 
requirements in paragraph (b) of this section and any appeals timely 
filed under Sec.  585.118(c)(1) have been resolved. After BOEM executes 
the lease, the provisional winner becomes the winning bidder, and BOEM 
will send the winning bidder an electronic version of the fully 
executed copy of the lease. The lease takes effect as set forth in 
Sec.  585.237.
    (f) The winning bidder must pay the first 12 months' rent under 
Sec.  585.503(a) within 45 calendar days after receiving a copy of the 
executed lease from BOEM.
    (g) In the event that a lessee does not meet the commitments it 
made to obtain any bidding credits, the lessee will be required to 
repay the value of the bidding credits that it received adjusted for 
inflation.


Sec.  585.226  What happens if the provisional winner fails to meet its 
obligations?

    (a) If BOEM determines that a provisional winner has failed to 
timely complete the steps outlined in Sec.  585.225(b) or Sec.  
585.316, or has otherwise failed to comply with applicable laws, 
regulations, or FSN provisions, BOEM may take one or more of the 
following actions:
    (1) Decline to execute the applicable lease.
    (2) Decline to execute the lease for any other lease areas that the 
provisional winner won during the auction.
    (3) Require forfeiture of the bid deposit. In the event the bid 
deposit exceeds the amount of the winning bid, BOEM would limit the 
required forfeiture to the lesser amount.
    (4) Refer the matter to the Department of the Interior's 
Administrative Remedies Division for suspension or debarment review 
pursuant to 2 CFR part 180 as implemented at 2 CFR part 1400.
    (5) Pursue any other remedy available.
    (b) If BOEM declines to execute a lease with the provisional winner 
under paragraph (a) of this section, BOEM may decide to select a new 
provisional winner by either repeating the auction under Sec.  
585.224(f), or pursuant to the procedures in Sec.  585.223(a)(8), by 
selecting the next highest bid submitted during the auction, or by 
using other procedures specified in the FSN.
    (c) BOEM's decisions under this section are appealable under Sec.  
585.118.


Sec. Sec.  585.227-585.229  [Reserved]

Noncompetitive Lease Award Process


Sec.  585.230  May I request a lease if there is no Call?

    You may submit an unsolicited request for a commercial lease or a 
limited lease under this part. Your unsolicited request must contain 
the following information:
    (a) The area you are requesting for lease.
    (b) A general description of your objectives and the facilities 
that you would use to achieve those objectives.
    (c) A general schedule of proposed activities including those 
leading to commercial operations.
    (d) Available and pertinent data and information concerning 
renewable energy and environmental conditions in the area of interest, 
including energy and resource data and information used to evaluate the 
area of interest. BOEM will withhold trade secrets and commercial or 
financial information that is privileged or confidential from public 
disclosure under exemption 4 of the FOIA and as provided in Sec.  
585.114.
    (e) If available from the appropriate State or local government 
authority, a statement that the proposed activity conforms with State 
and local energy planning requirements, initiatives, or guidance.
    (f) Documentation showing that you meet the qualifications to 
become a lessee, as specified in Sec. Sec.  585.107 and 585.108.
    (g) An acquisition fee, as specified in Sec.  585.502(a).


Sec.  585.231  Will BOEM issue leases noncompetitively?

    (a) BOEM will consider unsolicited requests for a lease on a case-
by-case basis and may issue a lease noncompetitively in accordance with 
this part. BOEM will issue a lease noncompetitively only if it has 
determined after public notice that no competitive interest exists. 
BOEM will not consider an unsolicited request for a lease under this 
part that is proposed in a lease area that is scheduled for a lease 
auction under this part.
    (b) At BOEM's discretion, BOEM may issue an RFI under Sec.  585.116 
relating to your unsolicited lease request and will consider comments 
received to determine if competitive interest exists. If BOEM decides 
not to issue an RFI and, therefore, not to continue processing your 
unsolicited lease request, it will refund your acquisition fee.
    (c) If BOEM determines that competitive interest exists in the 
lease area:
    (1) BOEM will proceed with the competitive process set forth in 
Sec. Sec.  585.210 through 585.226;
    (2) If you submit a bid for the lease area in a competitive lease 
sale, your acquisition fee will be applied to the deposit for your 
bonus bid; and
    (3) If you do not submit a bid for the lease area in a competitive 
lease sale, BOEM will not refund your acquisition fee.
    (d) If BOEM determines that there is no competitive interest in a 
lease and that further investigation of the area is in the public 
interest, it will:
    (1) Publish in the Federal Register a determination of no 
competitive interest.
    (2) Prepare and provide you with a written estimate of the proposed 
fee to pay for the processing costs under Sec.  585.112, including any 
environmental review that BOEM may require before lease issuance.
    (3) Conduct environmental reviews required by Federal law and 
consult with affected Federal agencies, federally recognized Indian 
Tribes, and State and local governments.
    (e) The following deadlines apply after issuance of a determination 
of no competitive interest:
    (1) Within 90 calendar days of receiving the written estimate of 
the fee, or longer (as determined at BOEM's discretion), you must pay 
the fee for any environmental review under Sec.  585.112.

[[Page 42734]]

Failure to pay the required fee may result in withdrawal of the 
determination of no competitive interest.
    (2) A determination of no competitive interest expires two years 
after its publication, unless BOEM determines that it should be 
extended for good cause. BOEM reserves the right to withdraw a 
determination of no competitive interest before it expires if BOEM 
determines that you have failed to exercise due diligence in obtaining 
a lease.
    (f) After BOEM publishes the determination of no competitive 
interest, you will be responsible for submitting any consistency 
certification and necessary data and information in a timely manner to 
the applicable State CZMA agencies and BOEM pursuant to 15 CFR part 
930, subpart D.
    (g) After completing its review of your lease request, BOEM may 
offer you a noncompetitive lease.
    (h) If you accept the terms and conditions of the lease, BOEM will 
issue the lease. You must comply with the terms and conditions of your 
lease and the applicable provisions of this part. If BOEM issues you a 
lease, BOEM will send you an electronic copy of the lease form.
    (1) Within 10 business days after you receive the lease you must:
    (i) Execute and return the lease; and
    (ii) File financial assurance as required under Sec. Sec.  585.516 
through 585.529.
    (2) You must pay the first 12 months' rent no later than 45 
calendar days after you receive your copy of the executed lease from 
BOEM under Sec.  585.503(a)(1).
    (i) BOEM will publish in the Federal Register a notice announcing 
the issuance of your lease.
    (j) If you do not accept the terms and conditions in a timely 
manner, BOEM will not issue a lease. Additionally, if you do not comply 
with the requirements for financial assurance, BOEM may decide not to 
issue a lease. If BOEM does not issue a lease due to your noncompliance 
or non-acceptance, BOEM will not refund your acquisition fee, or any 
fees paid under paragraph (e)(1) of this section.


Sec.  585.232  May I acquire a lease noncompetitively after responding 
to a request for information or a Call for Information and Nominations?

    (a) If you submit an area of interest for a possible lease and BOEM 
receives no competing submissions in response to the RFI or Call, we 
may inform you that there does not appear to be competitive interest, 
and ask if you wish to proceed with acquiring a lease.
    (b) If you wish to proceed with acquiring a lease, you must submit 
your acquisition fee as specified in Sec.  585.502(a).
    (c) After receiving the acquisition fee, BOEM will follow the 
process outlined in Sec.  585.231(d) through (j).


Sec. Sec.  585.233-585.234  [Reserved]

Commercial and Limited Lease Periods


Sec.  585.235  What are the lease periods for a commercial lease?

    (a) The lease periods within the term of your commercial lease are 
defined as follows:
    (1) Preliminary period. Each commercial lease has a preliminary 
period of up to five years. During the preliminary period, the lessee 
must submit a COP. The preliminary period begins on the effective date 
of the lease and ends either when a COP is received by BOEM for review 
or at the expiration of five years, whichever occurs first.
    (2) COP review period. A commercial lease has a COP review period. 
The COP review period begins when BOEM receives a COP from the lessee 
and ends upon COP approval, disapproval, or approval with conditions 
pursuant to Sec.  585.628. During the COP review period, BOEM conducts 
the necessary reviews and consultations associated with the COP.
    (3) Design and construction period. The design and construction 
period begins at COP approval and ends when the operations period 
begins. During the design and construction period BSEE completes the 
FDR and FIR review(s), and the lessee undertakes project construction.
    (4) Operations period. A commercial lease has an operations period 
of 35 years; or the duration specified in the lease; or the duration 
included and approved as part of your COP. The operations period begins 
when the requirements of 30 CFR 285.637(a) are met through the 
submission of final reports and records for your project. Additional 
time may be added to the operations period through a lease suspension 
under Sec.  585.415 issued during this period; a lease extension 
requested pursuant to paragraph (b) of this section; or a lease renewal 
under Sec.  585.425.
    (b) You may request an extension of any of the lease periods 
outlined in paragraph (a) of this section for good cause, including if 
the project is designed and verified for a longer duration. In its 
discretion, BOEM may approve your request.
    (c) If you intend to develop your lease in phases under Sec.  
585.238, you must propose lease period schedules for each phase in your 
COP.
    (d) If you intend to segregate or consolidate your lease under 
Sec. Sec.  585.408 through 585.413, you and your assignees may propose 
lease period schedules in your segregation or consolidation 
application.


Sec.  585.236  If I have a limited lease, how long will my lease remain 
in effect?

    (a) For limited leases, the lease periods are as shown in the 
following table:

------------------------------------------------------------------------
                                     Extension or
         Lease period                 suspension          Requirements
------------------------------------------------------------------------
(1) Each limited lease has a    If we receive a GAP     The GAP must
 preliminary period of 12        that satisfies the      meet the
 months within which to submit   requirements of Sec.    requirements of
 a GAP. The preliminary period   Sec.   585.640          Sec.  Sec.
 begins on the effective date    through 585.648, the    585.640 through
 of the lease.                   preliminary period      585.648.
                                 will be automatically
                                 extended for the
                                 period of time
                                 necessary for us to
                                 conduct a technical
                                 and environmental
                                 review of the GAP.
(2) Each limited lease has an   We may order or grant
 operations period as            a suspension of the
 specified by BOEM (if the       operations period as
 lease is issued                 provided in Sec.
 competitively) or negotiated    Sec.   585.415
 with the applicant (if the      through 585.421.
 lease is issued
 noncompetitively). In either
 case, the duration of the
 operations period will depend
 on the intended use of the
 lease. The operations period
 begins on the date that we
 approve your GAP.
------------------------------------------------------------------------

    (b) You may request an extension of any of the lease periods 
outlined in paragraph (a) of this section for good cause. In its 
discretion, BOEM may approve your request.

[[Page 42735]]

Sec.  585.237  What is the effective date of a lease?

    (a) A lease issued under this part must be dated and becomes 
effective as of the first day of the month following the date a lease 
is signed by the lessor.
    (b) If the lessee submits a written request and BOEM approves, a 
lease may be dated and become effective the first day of the month in 
which it is signed by the lessor.


Sec.  585.238   May I develop my commercial lease in phases?

    In your COP, you may request development of your commercial lease 
in phases. In support of your request, you must provide details as to 
what portions of the lease will be initially developed for commercial 
operations and what portions of the lease will be reserved for 
subsequent phased development. You must also propose a lease period 
schedule for each phase described in your COP in accordance with Sec.  
585.235(c). BOEM may condition its approval of subsequent phases 
described in a phased development COP.


Sec.  585.239  Are there any other renewable energy research activities 
that will be allowed on the OCS?

    (a) The Director may issue OCS leases, ROW grants, and RUE grants 
to a Federal agency or a State for renewable energy research activities 
that support the future production, transportation, or transmission of 
renewable energy.
    (b) In issuing leases, ROW grants, and RUE grants to a Federal 
agency or a State on the OCS for renewable energy research activities 
under this section, BOEM will coordinate and consult with other 
relevant Federal agencies, affected federally recognized Indian Tribes, 
any other affected State(s), and affected local government executives.
    (c) BOEM may issue leases, RUEs, and ROWs for research activities 
managed by a Federal agency or a State only in areas for which the 
Director has determined, after public notice and opportunity to 
comment, that no competitive interest exists.
    (d) The Director and the head of the Federal agency or the Governor 
of a requesting State, or their authorized representatives, will 
negotiate the terms and conditions of such renewable energy leases, 
RUEs, or ROWs under this section on a case-by-case basis. The framework 
for such negotiations, and standard terms and conditions of such 
leases, RUEs, or ROWs may be set forth in a memorandum of agreement 
(MOA) or other agreement between BOEM and a Federal agency or a State. 
The MOA must include the agreement of the head of the Federal agency or 
the Governor to assure that all subcontractors comply with this part 
and 30 CFR part 285, other applicable laws, and terms and conditions of 
such leases or grants.
    (e) Any lease, RUE, or ROW that BOEM issues to a Federal agency or 
to a State that authorizes access to an area of the OCS for research 
activities managed by a Federal agency or a State must include:
    (1) Requirements to comply with all applicable Federal laws; and
    (2) Requirements to comply with this part and 30 CFR part 285, 
except as otherwise provided in the lease or grant.
    (f) BOEM will issue a public notice of any lease, RUE, or ROW 
issued to a Federal agency or to a State, or an approved MOA for such 
research activities.
    (g) BOEM will not charge any fees for the purpose of ensuring a 
fair return for the use of such research areas on the OCS.


Sec. Sec.  585.240-585.299  [Reserved]

0
48. Revise subpart D to read as follows:

Subpart D--Right-of-Way (ROW) Grants and Right-of-Use and Easement 
(RUE) Grants for Renewable Energy Activities

Sec.

ROW Grants and RUE Grants

585.300 What types of activities are authorized by ROW grants and 
RUE grants issued under this part?
585.301 What do ROW grants and RUE grants include?
585.302 What are the general requirements for ROW grant and RUE 
grant holders?
585.303 How long will my ROW grant or RUE grant remain in effect?
585.304 [Reserved]

Obtaining ROW Grants and RUE Grants

585.305 How do I request a ROW grant or a RUE grant?
585.306 What action will BOEM take on my request?
585.307 How will BOEM determine whether competitive interest exists 
for ROW grants and RUE grants?
585.308 How will BOEM conduct an auction for ROW grants and RUE 
grants?
585.309 What is the effective date of a ROW grant or a RUE grant?
585.310-585.314 [Reserved]

Financial Requirements for ROW Grants and RUE Grants

585.315 What deposits are required for a competitive ROW grant or 
RUE grant?
585.316 What payments are required for ROW grants or RUE grants?
585.317-585.399 [Reserved]

Subpart D--Right-of-Way (ROW) Grants and Right-of-Use and Easement 
(RUE) Grants for Renewable Energy Activities

ROW Grants and RUE Grants


Sec.  585.300  What types of activities are authorized by ROW grants 
and RUE grants issued under this part?

    (a) A ROW grant authorizes the holder to install on the OCS cables, 
pipelines, and associated facilities that involve the transportation or 
transmission of electricity or other energy product from renewable 
energy projects.
    (b) A RUE grant authorizes the holder to construct and maintain 
facilities or other installations on the OCS that support the 
production, transportation, or transmission of electricity or other 
energy product from any renewable energy resource.
    (c) You do not need a ROW grant or RUE grant for a project easement 
authorized under Sec.  585.200(b) to serve your lease.


Sec.  585.301  What do ROW grants and RUE grants include?

    (a) A ROW grant:
    (1) Includes the full length of the corridor on which a cable, 
pipeline, or associated facility is located;
    (2) Is of a width sufficient to accommodate potential changes at 
the design and installation phases of the project, with an option for 
the grant holder to relinquish unused portions of the ROW after 
construction is complete; and
    (3) For the associated facilities, is limited to the area 
reasonably necessary for a power or pumping station or other facilities 
requested.
    (b) A RUE grant includes the site on which a facility or other 
structure is located and the areal extent of anchors, chains, and other 
equipment associated with a facility or other structure. The specific 
boundaries of a RUE will be determined by BOEM on a case-by-case basis 
and set forth in each RUE grant.


Sec.  585.302  What are the general requirements for ROW grant and RUE 
grant holders?

    (a) To acquire a ROW grant or RUE grant, you must provide evidence 
that you meet the qualifications set forth in Sec. Sec.  585.107 and 
585.108.
    (b) A ROW grant or RUE grant is subject to the following 
conditions:
    (1) The rights granted will not prevent the granting of other 
rights by the United States, either before or after the granting of the 
ROW or RUE, provided that any subsequent authorization issued by BOEM 
in the area of a previously issued ROW grant or RUE

[[Page 42736]]

grant may not unreasonably interfere with activities approved or impede 
existing operations under such a grant; and
    (2) The holder agrees that the United States, its lessees, or other 
ROW grant or RUE grant holders may use or occupy any part of the ROW 
grant or RUE grant not actually occupied or necessarily incident to its 
use for any necessary activities.


Sec.  585.303   How long will my ROW grant or RUE grant remain in 
effect?

    The periods within the term of your grant are defined as follows:
    (a) Each ROW or RUE grant has a preliminary period of 12 months 
from the effective date of the ROW or RUE grant within which to submit 
a GAP. The preliminary period begins on the effective date of the 
grant. You must submit a GAP no later than the end of the preliminary 
period for your grant to remain in effect. However, you may submit a 
GAP before the issuance of your ROW or RUE grant.
    (b) Each ROW or RUE grant has an operations period as set by BOEM 
(if the grant is issued competitively) or negotiated with the applicant 
(if the grant is issued noncompetitively). In either case, the duration 
of the operations period will depend on the intended use of the grant. 
The operations period begins on the date that we approve your GAP.
    (c) You may request an extension of any of the grant periods 
outlined in paragraphs (a) and (b) of this section for good cause. In 
its discretion, BOEM may approve your request.


Sec.  585.304   [Reserved]

Obtaining ROW Grants and RUE Grants


Sec.  585.305  How do I request a ROW grant or a RUE grant?

    You must submit a request for a new or modified ROW grant or RUE 
grant to BOEM pursuant to Sec.  585.111. You must submit a separate 
request for each ROW grant or RUE grant you are requesting. The request 
must contain the following information:
    (a) The area you are requesting for a ROW grant or RUE grant.
    (b) A general description of your objectives and the facilities 
that you would use to achieve those objectives.
    (c) A general schedule of proposed activities.
    (d) Pertinent information concerning environmental conditions in 
the area of interest.


Sec.  585.306  What action will BOEM take on my request?

    BOEM will consider requests for ROW grants and RUE grants on a 
case-by-case basis and may issue a grant competitively, as provided in 
Sec.  585.308, or noncompetitively if we determine after public notice 
that there is no competitive interest. BOEM will coordinate and consult 
with relevant Federal agencies, the Governor of any affected State, and 
the executive of any affected local government.
    (a) In response to an unsolicited request for a ROW grant or RUE 
grant, BOEM will first determine if there is competitive interest, as 
provided in Sec.  585.307.
    (b) If BOEM determines there is no competitive interest in a ROW or 
RUE grant, BOEM will publish a notice in the Federal Register of such 
determination. After BOEM publishes this notice, you are responsible 
for submitting any required consistency certification and necessary 
data and information in a timely manner to BOEM and the applicable 
State CZMA agency pursuant to 15 CFR part 930, subpart D. BOEM may 
establish terms and conditions for a noncompetitive grant and offer the 
grant to you:
    (1) If you accept the terms and conditions of the grant, BOEM will 
issue the grant.
    (2) If you do not accept the terms and conditions of the grant, 
BOEM may agree to modify the terms and conditions or may decide not to 
issue the grant.


Sec.  585.307   How will BOEM determine whether competitive interest 
exists for ROW grants and RUE grants?

    To determine whether or not there is competitive interest:
    (a) We will publish a public notice, generally describing the 
parameters of the project, to give affected and interested parties an 
opportunity to comment on the proposed ROW grant or RUE grant area.
    (b) We will evaluate any comments received on the notice and make a 
determination of the level of competitive interest.
    (c) BOEM may consider a State's or Regional Transmission Operator/
Independent System Operator's process that identifies a transmission 
project that needs a ROW and/or a RUE grant to achieve its intended 
purpose. BOEM may determine that there is no competitive interest that 
would be consistent with OCSLA's goal of allowing the expeditious and 
orderly development of OCS energy projects, if offering the ROW and/or 
RUE competitively could challenge the viability of the transmission 
project intended to be located on State submerged lands and the OCS 
(e.g., technical and economic feasibility or practicality concerns, 
including significant delays, by having different entities holding the 
right to develop the transmission project in State submerged lands and 
the OCS).


Sec.  585.308  How will BOEM conduct an auction for ROW grants and RUE 
grants?

    (a) If BOEM determines that there is competitive interest, we will:
    (1) Publish a notice of each grant auction in the Federal Register 
describing auction procedures, allowing interested persons 30 days to 
comment; and
    (2) Conduct a competitive auction for issuing the ROW grant or RUE 
grant. The auction process for ROW grants and RUE grants will be 
conducted following the same process for leases set forth in Sec. Sec.  
585.210 through 585.226.
    (b) If you are the successful bidder in an auction, you must pay 
the first year's rent, as provided in Sec.  585.316.


Sec.  585.309  What is the effective date of a ROW grant or a RUE 
grant?

    Your ROW grant or RUE grant becomes effective on the date 
established by BOEM on the ROW grant or RUE grant instrument.


Sec. Sec.  585.310-585.314  [Reserved]

Financial Requirements for ROW Grants and RUE Grants


Sec.  585.315  What deposits are required for a competitive ROW grant 
or RUE grant?

    (a) You must make a deposit, as required in Sec.  585.501(a), 
regardless of whether the auction is a sealed-bid, oral, electronic, or 
other auction format. BOEM will specify in the sale notice the official 
to whom you must submit the payment, the time by which the official 
must receive the payment, and the forms of acceptable payment.
    (b) If your high bid is rejected, we will provide a written 
statement of reasons.
    (c) For all rejected bids, we will refund, without interest, any 
money deposited with your bid.


Sec.  585.316  What payments are required for ROW grants or RUE grants?

    Before we issue the ROW grant or RUE grant, you must pay:
    (a) Any balance on accepted high bids to Office of Natural 
Resources Revenue (ONRR), as provided in the sale notice.
    (b) An annual rent for the first year of the grant, as specified in 
Sec.  585.508.


Sec. Sec.  585.317-585.399  [Reserved]

0
49. Revise subpart E to read as follows:

[[Page 42737]]

Subpart E--Lease and Grant Administration

Sec.
585.400-585.404 [Reserved]

Designation of Operator

585.405 How do I designate an operator?
585.406 Who is responsible for fulfilling lease and grant 
obligations?
585.407 [Reserved]

Lease or Grant Assignment, Segregation, and Consolidation

585.408 May I assign my lease or grant interest?
585.409 How do I request approval of a lease or grant assignment?
585.410 When will my assignment result in a segregated lease?
585.411 How does an assignment affect the assignor's liability?
585.412 How does an assignment affect the assignee's liability?
585.413 How do I consolidate leases or grants?
585.414 [Reserved]

Lease or Grant Suspension

585.415 What is a lease or grant suspension?
585.416 How do I request a lease or grant suspension?
585.417 When may BOEM order a suspension?
585.418 How will BOEM issue a suspension?
585.419 What are my immediate responsibilities if I receive a 
suspension order?
585.420 What effect does a suspension order have on my payments?
585.421 How long will a lease or grant suspension be in effect?

Lease or Grant Cancellation

585.422 When can my lease or grant be canceled?
585.423-585.424 [Reserved]

Lease or Grant Renewal

585.425 May I obtain a renewal of my lease or grant before it 
terminates?
585.426 When must I submit my request for renewal?
585.427 How long is a renewal?
585.428 What effect does applying for a renewal have on my 
activities and payments?
585.429 What criteria will BOEM consider in deciding whether to 
renew a lease or grant?
585.430-585.431 [Reserved]

Lease or Grant Termination

585.432 When does my lease or grant terminate?
585.433 What must I do after my lease or grant terminates?
585.434 When may BOEM authorize facilities to remain in place 
following termination of a lease or grant?

Lease or Grant Relinquishment, Contraction, or Cancellation

585.435 How can I relinquish a lease or a grant or parts of a lease 
or grant?
585.436 Can BOEM require lease or grant contraction?
585.437 [Reserved]
585.438 What happens to leases or grants (or portions thereof) that 
have been relinquished, contracted, or cancelled?
585.439-585.499 [Reserved]

Subpart E--Lease and Grant Administration


Sec. Sec.  585.400-585.404   [Reserved]

Designation of Operator


Sec.  585.405   How do I designate an operator?

    (a) If you intend to designate an operator who is not the lessee or 
grant holder, you must identify the proposed operator in your SAP 
(under Sec.  585.610(a)(3)), COP (under Sec.  585.626(a)(2)), or GAP 
(under Sec.  585.645(a)(2)), as applicable. If no operator is 
designated in a SAP, COP, or GAP, BOEM will deem the lessee or grant 
holder to be the operator.
    (b) An operator must be designated in any SAP, COP, or GAP if there 
is more than one lessee or grant holder for any individual lease or 
grant.
    (c) Once approved in your plan, the designated operator is 
authorized to act on your behalf and required to perform activities 
necessary to comply with the OCS Lands Act, the lease or grant, and the 
regulations in this part.
    (d) You, or your designated operator, must immediately provide BOEM 
with a written notification of change of address of the lessee or 
operator.
    (e) If there is a change in the designated operator, you must 
provide written notice to BOEM and identify the new designated operator 
within 72 hours on a form approved by BOEM. The lessee(s) or grantee(s) 
is the operator and responsible for compliance until BOEM approves 
designation of the new operator.
    (f) Designation of an operator under any lease or grant issued 
under this part does not relieve the lessee or grant holder of its 
obligations under this part or its lease or grant.
    (g) A designated operator performing activities on the lease must 
comply with all regulations governing those activities and may be held 
liable or penalized for any noncompliance during the time it was the 
operator, notwithstanding its subsequent resignation.


Sec.  585.406  Who is responsible for fulfilling lease and grant 
obligations?

    (a) When you are not the sole lessee or grantee, you and your co-
lessee(s) or co-grantee(s) are jointly and severally responsible for 
fulfilling your obligations under the lease or grant and the provisions 
of this part and 30 CFR part 285, unless otherwise provided in this 
part.
    (b) If your designated operator fails to fulfill any of your 
obligations under the lease or grant and this part, BOEM may require 
you or any or all of your co-lessees or co-grantees to fulfill those 
obligations or other operational obligations under the OCS Lands Act, 
the lease, grant, or this part.
    (c) Whenever the regulations in this part require the lessee or 
grantee to conduct an activity in a prescribed manner, the lessee or 
grantee and operator (if one has been designated) are jointly and 
severally responsible for complying with this part.


Sec.  585.407   [Reserved]

Lease or Grant Assignment, Segregation, and Consolidation


Sec.  585.408  May I assign my lease or grant interest?

    (a) You may assign all or part of your lease or grant interest, 
including record title, to one or more parties, subject to BOEM 
approval under this subpart. Each instrument that creates or transfers 
an interest must describe the entire tract or describe by officially 
designated subdivisions the interest you propose to create or transfer. 
Your application to assign a lease or grant may include a request to 
modify the existing lease or grant period schedule consistent with 
Sec.  585.235(d).
    (b) If you submit an application to assign a lease or grant, you 
will continue to be responsible for payments that are or become due on 
the lease or grant until the date BOEM approves the assignment.
    (c) The assignment takes effect on the first day of the month 
following the date on which BOEM approves your request, unless you 
request an earlier effective date and BOEM approves that earlier date, 
but such earlier effective date, if prior to the date of BOEM's 
approval, does not relieve you of your obligations accrued between that 
earlier effective date and the date of approval.
    (d) You do not need to request an assignment for business mergers, 
name changes, or changes of business form. You must notify BOEM of 
these events under Sec.  585.110.


Sec.  585.409  How do I request approval of a lease or grant 
assignment?

    (a) You must request approval of each assignment on a form approved 
by BOEM and submit originals of each instrument that creates or 
transfers ownership of record title or certified copies thereof within 
90 days after the last party executes the transfer agreement.

[[Page 42738]]

    (b) Any assignee will be subject to all the terms and conditions of 
your original lease or grant, including the requirement to furnish 
financial assurance in the amount required in Sec. Sec.  585.516 
through 585.537.
    (c) The assignee must submit proof of eligibility and other 
qualifications specified in Sec. Sec.  585.107 and 585.108.
    (d) Persons executing on behalf of the assignor and assignee must 
furnish evidence of authority to execute the assignment.


Sec.  585.410  When will my assignment result in a segregated lease?

    (a) When there is an assignment by all record title owners of 100 
percent of the record title to one or more aliquots in a lease, the 
assigned and retained portions become segregated into separate and 
distinct leases. In such a case, both the new lease and the remaining 
portion of the original lease are referred to as ``segregated leases'' 
and the assignee becomes the record title owner of the new lease, which 
is subject to all the terms and conditions of the original lease. The 
financial assurance requirements of subpart F of this part apply 
separately to each segregated lease.
    (b) If a record title owner transfers an undivided interest of less 
than 100 percent of the record title interest in any given aliquot, 
that transfer will not segregate the portions of that aliquot, or the 
whole aliquot, in which part of the record title was transferred, into 
a separate lease from the portions in which no interest was 
transferred. Instead, that transfer will create a joint ownership 
between the assignee and assignor in the portions of the lease in which 
part of the record title interest was transferred.
    (c) When a lease becomes segregated, BOEM may issue separate Plan 
approvals for a segregated lease or take other actions within its 
discretion.


Sec.  585.411  How does an assignment affect the assignor's liability?

    As assignor, you are liable for all obligations, monetary and 
nonmonetary, that accrued under your lease or grant before BOEM 
approves your assignment. Our approval of the assignment does not 
relieve you of these accrued obligations. BOEM may require you to bring 
the lease or grant into compliance to the extent the obligation accrued 
before the effective date of your assignment if your assignee or 
subsequent assignees fail to perform any obligation under the lease or 
grant.


Sec.  585.412  How does an assignment affect the assignee's liability?

    (a) As assignee, you are liable for all lease or grant obligations 
that accrue after BOEM approves the assignment. As assignee, you must 
comply with all the terms and conditions of the lease or grant and all 
applicable regulations, remedy all existing environmental and 
operational problems on the lease or grant, and comply with all 
decommissioning requirements under 30 CFR part 285, subpart I.
    (b) Assignees are bound to comply with each term or condition of 
the lease or grant and the regulations in this part and 30 CFR part 
285. You are jointly and severally liable for the performance of all 
obligations under the lease or grant and under the regulations in this 
part and 30 CFR part 285 with each prior and subsequent lessee who held 
an interest from the time the obligation accrued until it is satisfied, 
unless this part provides otherwise.


Sec.  585.413  How do I consolidate leases or grants?

    (a) You may apply to consolidate all or part of two or more 
adjacent leases or grants held by the same lessee or grant holder into 
one new lease or grant, subject to BOEM's approval. The application 
must include a description of the leases or grants, or portions 
thereof, to be consolidated, including the relevant lease number, lease 
blocks, and aliquots.
    (b) An approved consolidation will create a new lease or grant that 
will be subject to the terms and conditions of the consolidated leases 
or grants.
    (c) To the extent the leases or grants to be consolidated have 
different times remaining in the relevant lease or grant periods, BOEM 
will default to using the shorter remaining periods in the new lease or 
grant but will consider requests for a revised lease or grant period 
schedule included in the consolidation application.
    (d) To the extent the leases or grants to be consolidated have 
other different terms and conditions, BOEM will default to using the 
terms and conditions in the most recently issued lease or grant to be 
consolidated for the new lease. BOEM will consider requests for 
modifications on a case-by-case basis and, in its discretion, approve 
such requests for good cause.
    (e) Before BOEM will approve your consolidation request, BOEM will 
assess appropriate financial assurance obligations for the new lease or 
grant per Sec. Sec.  585.516 and 585.517 or Sec. Sec.  585.520 and 
585.521.
    (f) Any consolidated leases and grants that have been absorbed into 
the new lease or grant in their entirety will be considered terminated 
at the time of consolidation approval.


Sec.  585.414  [Reserved]

Lease or Grant Suspension


Sec.  585.415  What is a lease or grant suspension?

    (a) A suspension is an interruption of the period of your lease or 
grant that may occur:
    (1) As approved by BOEM at your request, as provided in Sec.  
585.416; or
    (2) As ordered by BOEM, as provided in Sec.  585.417 or by BSEE as 
provided in 30 CFR 285.417.
    (b) A lease or grant suspension extends the expiration date for the 
relevant period of your lease or grant for the length of time the 
suspension is in effect.
    (c) Activities may not be conducted on your lease or grant during 
the period of a suspension except as expressly authorized under the 
terms of the lease or grant suspension.


Sec.  585.416   How do I request a lease or grant suspension?

    (a) You must submit a written request to BOEM that includes the 
following information no later than 90 calendar days before the 
expiration of your appropriate lease or grant period:
    (1) The reasons you are requesting suspension of your lease or 
grant, including an explanation why the suspension is necessary.
    (2) The length of additional time requested.
    (3) An explanation why it is in the public interest to approve the 
suspension.
    (4) Any other information BOEM may require.
    (b) If you are unable to timely submit a COP or GAP, as required, 
you may request a suspension to extend the preliminary period of your 
lease or grant. Your request must include a revised schedule for 
submission of your COP or GAP, as appropriate.


Sec.  585.417  When may BOEM order a suspension?

    BOEM may order a suspension under the following circumstances:
    (a) When necessary to comply with judicial decrees prohibiting some 
or all activities under your lease; or
    (b) When the suspension is necessary for reasons of national 
security or defense.


Sec.  585.418  How will BOEM issue a suspension?

    (a) BOEM will issue a suspension order orally or in writing.

[[Page 42739]]

    (b) BOEM will send you a written suspension order as soon as 
practicable after issuing an oral suspension order.
    (c) The written order will explain the reasons for its issuance and 
describe the effect of the suspension order on your lease or grant and 
any associated activities. BOEM may authorize certain activities during 
the period of the suspension, as set forth in the suspension order.


Sec.  585.419  What are my immediate responsibilities if I receive a 
suspension order?

    You must comply with the terms of a suspension order upon receipt 
and take any action prescribed within the time set forth therein.


Sec.  585.420  What effect does a suspension order have on my payments?

    (a) While BOEM evaluates your request for a suspension under Sec.  
585.416, you must continue to fulfill your payment obligation until the 
end of the original term of your lease or grant. If our evaluation goes 
beyond the end of the original term of your lease or grant, the term of 
your lease or grant will be extended for the period of time necessary 
for BOEM to complete its evaluation of your request, but you will not 
be required to make payments during the time of the extension.
    (b) If BOEM approves your request for a suspension under Sec.  
585.416, or orders a suspension under Sec.  585.417, BOEM may waive or 
defer your payment obligations during the suspension. BOEM's decision 
to waive or defer payments will depend on the reasons for the 
suspension, including your responsibility for the circumstances 
necessitating a suspension.


Sec.  585.421   How long will a lease or grant suspension be in effect?

    A lease or grant suspension will be in effect for the period 
specified by BOEM.
    (a) BOEM will not approve a lease or grant suspension request 
pursuant to Sec.  585.416 for a period longer than 2 years.
    (b) If BOEM determines that the circumstances giving rise to a 
suspension ordered under Sec.  585.417 cannot be resolved within 5 
years, the Secretary may initiate cancellation of the lease or grant.

Lease or Grant Cancellation


Sec.  585.422  When can my lease or grant be canceled?

    (a) The Secretary will cancel any lease or grant issued under this 
part upon proof that it was obtained by fraud or misrepresentation, and 
after notice and opportunity to be heard has been afforded to the 
lessee or grant holder.
    (b) The Secretary may cancel any lease or grant issued under this 
part when:
    (1) The Secretary determines after notice and opportunity for a 
hearing that, with respect to the lease or grant that would be 
canceled, the lessee or grantee has failed to comply with any 
applicable provision of the OCS Lands Act or this part; any order of 
the Director; or any term, condition, or stipulation contained in the 
lease or grant, and that the failure to comply continued 30 days (or 
other period BOEM specifies) after you receive notice from BOEM. The 
Secretary will mail a notice by registered or certified letter to the 
lessee or grantee at its record post office address;
    (2) The Secretary determines after notice and opportunity for a 
hearing that you have terminated commercial operations under your COP, 
as provided in Sec.  585.635, or other approved activities under your 
GAP, as provided in Sec.  585.656;
    (3) Required by national security or defense; or
    (4) The Secretary determines after notice and opportunity for a 
hearing that continued activity under the lease or grant:
    (i) Would cause serious harm or damage to natural resources; life 
(including human and wildlife); property; the marine, coastal, or human 
environment; or sites, structures, or objects of historical or 
archaeological significance; and
    (ii) That the threat of harm or damage would not disappear or 
decrease to an acceptable extent within a reasonable period of time; 
and
    (iii) The advantages of cancellation outweigh the advantages of 
continuing the lease or grant in force.


Sec. Sec.  585.423-585.424   [Reserved]

Lease or Grant Renewal


Sec.  585.425  May I obtain a renewal of my lease or grant before it 
terminates?

    You may request renewal of the operations period of your lease or 
the original authorized period of your grant. BOEM, at its discretion, 
may approve a renewal request to conduct substantially similar 
activities as were originally authorized under the lease or grant. BOEM 
will not approve a renewal request that involves development of a type 
of renewable energy not originally authorized in the lease or grant. 
BOEM may revise or adjust payment terms of the original lease, as a 
condition of lease renewal.


Sec.  585.426  When must I submit my request for renewal?

    (a) You must request a renewal from BOEM:
    (1) No later than 180 days before the termination date of your 
limited lease or grant.
    (2) No later than two years before the termination date of the 
operations period of your commercial lease.
    (b) You must submit to BOEM all information we request pertaining 
to your lease or grant and your renewal request.


Sec.  585.427  How long is a renewal?

    BOEM will set the length of the renewal at the time of renewal on a 
case-by-case basis.
    (a) For commercial leases, the length of the renewal will not 
exceed the original operations period unless a longer time is 
negotiated by the parties.
    (b) For limited leases, the length of the renewal will not exceed 
the original operations period.
    (c) For RUE and ROW grants, a renewal will continue for as long as 
the associated activities are conducted and facilities properly 
maintained and used for the purpose for which the grant was made, 
unless otherwise expressly stated.


Sec.  585.428   What effect does applying for a renewal have on my 
activities and payments?

    If you timely request a renewal:
    (a) You may continue to conduct activities approved under your 
lease or grant under the original terms and conditions for as long as 
your request is pending decision by BOEM.
    (b) You may request a suspension of your lease or grant, as 
provided in Sec.  585.416, while we consider your request.
    (c) For the period BOEM considers your request for renewal, you 
must continue to make all payments in accordance with the original 
terms and conditions of your lease or grant.


Sec.  585.429  What criteria will BOEM consider in deciding whether to 
renew a lease or grant?

    BOEM will consider the following criteria in deciding whether to 
renew a lease or grant:
    (a) Design life of existing technology.
    (b) Availability and feasibility of new technology.
    (c) Environmental and safety record of the lessee or grantee.
    (d) Operational and financial compliance record of the lessee or 
grantee.
    (e) Competitive interest and fair return considerations.
    (f) Effects of the lease or grant on generation capacity and 
reliability

[[Page 42740]]

within the regional electrical distribution and transmission system.
    (g) Other relevant factors, as appropriate.


Sec. Sec.  585.430-585.431   [Reserved]

Lease or Grant Termination


Sec.  585.432   When does my lease or grant terminate?

    Your lease or grant terminates on whichever of the following dates 
occurs first:
    (a) The expiration of the applicable period of your lease or grant, 
unless the relevant period is extended under Sec.  585.235(b) or Sec.  
585.236(b), a request for renewal of your lease or grant is pending a 
decision by BOEM, or your lease or grant is suspended or renewed as 
provided in this subpart, in which case it terminates on the date set 
forth in the notice of suspension or renewal;
    (b) A cancellation, as set forth in Sec.  585.422; or
    (c) Relinquishment, as set forth in Sec.  585.435.


Sec.  585.433  What must I do after my lease or grant terminates?

    (a) After your lease or grant terminates, you must:
    (1) Make all payments due, including any accrued rentals and 
deferred bonuses; and
    (2) Perform any other outstanding obligations under the lease or 
grant within 6 months.
    (b) Within 2 years following termination of a lease or grant, you 
must remove or dispose of all facilities, installations, and other 
devices permanently or temporarily attached to the seabed on the OCS in 
accordance with your BOEM-issued lease for hydrokinetic facilities or 
an application approved by BSEE under 30 CFR part 285, subpart I.
    (c) If you fail to comply with your BOEM-issued lease for 
hydrokinetic facilities or decommissioning application:
    (1) BOEM may call for the forfeiture of your financial assurance; 
and
    (2) You remain liable for removal or disposal costs and responsible 
for accidents or damages that might result from such failure.


Sec.  585.434  When may BOEM authorize facilities to remain in place 
following termination of a lease or grant?

    (a) In your decommissioning application that you submit to BSEE in 
accordance with 30 CFR 285.905 and 285.906, you may request that 
certain facilities authorized in your lease or grant remain in place 
for activities authorized in this part, elsewhere in this subchapter, 
or by other applicable Federal laws.
    (b) BOEM may approve such requests on a case-by-case basis 
considering the following:
    (1) Potential impacts to the marine environment;
    (2) Competing uses of the OCS;
    (3) Impacts on marine safety and national defense;
    (4) Maintenance of adequate financial assurance; and
    (5) Other factors determined by the Director.
    (c) Except as provided in paragraph (d) of this section, if BOEM 
authorizes facilities to remain in place, the former lessee or grantee 
under this part remains jointly and severally liable for 
decommissioning the facility unless satisfactory evidence is provided 
to BOEM showing that another party has assumed that responsibility and 
has secured adequate financial assurances.
    (d) In your decommissioning application, you may request that 
certain facilities authorized in your lease or grant be converted to an 
artificial reef or otherwise toppled in place. BOEM will evaluate all 
such requests.

Lease or Grant Relinquishment, Contraction, or Cancellation


Sec.  585.435  How can I relinquish a lease or a grant or parts of a 
lease or grant?

    (a) You may surrender a lease or grant, or a designated subdivision 
thereof, by filing with BOEM a properly completed official 
relinquishment form available on the BOEM website. A relinquishment 
takes effect on the date BOEM receives your completed form, subject to 
the continued obligation of the lessee or grant holder and the surety 
to:
    (1) Make all payments due on the lease or grant, including any 
accrued rent and deferred bonuses;
    (2) Decommission all facilities on the relinquished lease or grant 
(or portion thereof) to BSEE's satisfaction; and
    (3) Perform any other outstanding obligations under the lease or 
grant.
    (b) After you submit a completed relinquishment form for a lease or 
grant, ONRR will bill you for any outstanding payments that have 
accrued from obligations arising under the relinquished lease or grant.


Sec.  585.436  Can BOEM require lease or grant contraction?

    At an interval no more frequent than every 5 years, BOEM may review 
your lease or grant area to determine whether the lease or grant area 
is larger than needed to develop the project and manage activities in a 
manner that is consistent with the provisions of this part. BOEM will 
notify you of our proposal to contract the lease or grant area.
    (a) BOEM will give you the opportunity to present orally or in 
writing information demonstrating that you need the area in question to 
manage lease or grant activities consistent with this part.
    (b) Prior to taking action to contract the lease or grant area, 
BOEM will issue a decision addressing your contentions that the area is 
needed.
    (c) You may appeal this decision under Sec.  585.118.


Sec.  585.437  [Reserved]


Sec.  585.438  What happens to leases or grants (or portions thereof) 
that have been relinquished, contracted, or cancelled?

    (a) If a lease or grant (or portion thereof) is relinquished, 
contracted, or cancelled under Sec.  585.435, Sec.  585.436, or Sec.  
585.422, respectively, BOEM may restart the competitive leasing process 
at any point set forth in Sec.  585.210 that it deems reasonable and 
appropriate (e.g., Call, area identification, PSN, or FSN), subject to 
all necessary environmental analyses and consultations.
    (b) If a competitively issued lease or grant (or portion thereof) 
is relinquished or cancelled under Sec.  585.435 or Sec.  585.422, 
respectively, within six months of the auction, BOEM may reoffer the 
lease or grant (or portion thereof) to the next highest bidder from 
that auction, if one can be identified. If BOEM decides to reoffer to 
the next highest bidder, the price will be the next best bid, or a 
prorated amount based on the size of the relinquished share, as long as 
the next best bid reflects a fair return to the government.


Sec. Sec.  585.439-585.499   [Reserved]

0
50. Revise subpart F to read as follows:

Subpart F--Payments and Financial Assurance Requirements

Sec.

Payments

585.500 How do I make payments under this part?
585.501 What deposits must I submit for a competitively issued 
lease, ROW grant, or RUE grant?
585.502 What initial payment requirements must I meet to obtain a 
noncompetitive lease, ROW grant, or RUE grant?
585.503 What are the rent and operating fee requirements for a 
commercial lease?
585.504 How are my payments affected if I develop my commercial 
lease in phases?
585.505 What are the rent and operating fee requirements for a 
limited lease?

[[Page 42741]]

585.506 What operating fees must I pay on a commercial lease?
585.507 What rent payments must I pay on a project easement?
585.508 What rent payments must I pay on ROW grants or RUE grants 
associated with renewable energy projects?
585.509 Who is responsible for submitting lease or grant payments to 
ONRR?
585.510 May BOEM defer, reduce, or waive my lease or grant payments?
585.511-585.515 [Reserved]

Financial Assurance Requirements for Commercial Leases

585.516 What are the financial assurance requirements for each stage 
of my commercial lease?
585.517 How will BOEM determine the supplemental financial assurance 
associated with commercial leases?
585.518-585.519 [Reserved]

Financial Assurance for Limited Leases, ROW Grants, and RUE Grants

585.520 What financial assurance must I provide when I obtain my 
limited lease, ROW grant, or RUE grant?
585.521 Do my financial assurance requirements change as activities 
progress on my limited lease or grant?
585.522-585.524 [Reserved]

Requirements for Financial Assurance Instruments

585.525 What general requirements must a financial assurance 
instrument meet?
585.526 What instruments other than a surety bond may I use to meet 
the financial assurance requirement?
585.527 May I demonstrate financial strength and reliability to meet 
the financial assurance requirement for lease or grant activities?
585.528 May I use a third-party guaranty to meet the financial 
assurance requirement for lease or grant activities?
585.529 Can I use a lease- or grant-specific decommissioning account 
to meet the financial assurance requirements related to 
decommissioning?

Changes in Financial Assurance

585.530 What must I do if my financial assurance lapses?
585.531 What happens if the value of my financial assurance is 
reduced?
585.532 What happens if my surety wants to terminate the period of 
liability of my financial assurance?
585.533 How does my surety obtain cancellation of my financial 
assurance?
585.534 When may BOEM cancel my financial assurance?
585.535 Why might BOEM call for forfeiture of my financial 
assurance?
585.536 How will I be notified of a call for forfeiture?
585.537 How will BOEM proceed once my bond or other security is 
forfeited?
585.538-585.539 [Reserved]

Revenue Sharing With States

585.540 How will BOEM equitably distribute revenues to States?
585.541 What is a qualified project for revenue sharing purposes?
585.542 What makes a State eligible for payment of revenues?
585.543 Example of how the inverse distance formula works.
585.544-585.599 [Reserved]

Subpart F--Payments and Financial Assurance Requirements

Payments


Sec.  585.500  How do I make payments under this part?

    (a) For acquisition fees or the initial 12 months' rent paid for 
the preliminary period of your lease, you must make your electronic 
payments through the Fees for Services page on the BOEM website at 
https://www.boem.gov, and you must include one copy of the Pay.gov 
confirmation receipt page with your unsolicited request.
    (b) For all other required rent payments and for operating fee 
payments, you must make your payments as required in 30 CFR 1218.51.
    (c) The following table summarizes payments you must make for 
leases and grants, unless otherwise specified in the Final Sale Notice:

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                             Payment                 Amount                 Due date          Payment mechanism      Section reference
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Initial payments for leases
--------------------------------------------------------------------------------------------------------------------------------------------------------
(1) If your lease is issued          Bid Deposit...........  As set in Final Sale    With bid.............  Pay.gov..............  Sec.   585.501.
 competitively.                                               Notice/depends on bid.
                                     Bonus Balance.........  ......................  Within 10 business     30 CFR 1218.51.......  Sec.   585.225.
                                                                                      days of receiving
                                                                                      the unsigned lease.
(2) If your lease is issued non-     Acquisition Fee.......  $0.25 per acre, unless  With application.....  Pay.gov..............  Sec.   585.502.
 competitively.                                               otherwise set by the
                                                              Director.
(3) All leases.....................  Initial Rent..........  $3 per acre per year..  Within 45 calendar     Pay.gov..............  Sec.   585.503.
                                                                                      days after receiving
                                                                                      your copy of the
                                                                                      executed lease from
                                                                                      BOEM.
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                  Subsequent payments for leases and project easements
--------------------------------------------------------------------------------------------------------------------------------------------------------
(4) All leases.....................  Subsequent Rent,        $3 per acre per year..  Annually.............  30 CFR 1218.51.......  Sec.  Sec.   585.503
                                      unless otherwise                                                                              and 585.504.
                                      provided in the terms
                                      of the lease.
(5) If you have a project easement.  Rent, unless otherwise  Greater of $5 per acre  Upon COP or GAP        30 CFR 1218.51.......  Sec.   585.507.
                                      provided in the terms   per year or $450 per    approval, then
                                      of the grant.           year.                   annually.
(6) If your commercial lease is      Operating Fee.........  Determined by the       Annually.............  30 CFR 1218.51.......  Sec.   585.506.
 producing.                                                   formula in Sec.
                                                              585.506.
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                       Payments for ROW grants and RUE grants \1\
--------------------------------------------------------------------------------------------------------------------------------------------------------
(7) All ROW grants and RUE grants..  Initial Rent..........  Greater of $5 per acre  Grant execution......  Pay.gov..............  Sec.   585.508.
                                                              per year or $450 per
                                                              year, unless
                                                              otherwise established
                                                              in the grant.

[[Page 42742]]

 
                                     Subsequent Rent.......  ......................  Annually or in 5-year  30 CFR 1218.51.......
                                                                                      batches.
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ There is no acquisition fee for ROW grants or RUE grants.

Sec.  585.501  What deposits must I submit for a competitively issued 
lease, ROW grant, or RUE grant?

    (a) For a competitively issued lease or grant, BOEM may require a 
bid deposit before the auction as established in the FSN.
    (b) The provisional winner of a lease must pay the balance of its 
accepted bid in accordance with Sec.  585.225.


Sec.  585.502  What initial payment requirements must I meet to obtain 
a noncompetitive lease, ROW grant, or RUE grant?

    When requesting a noncompetitive lease, you must meet the initial 
payment (acquisition fee) requirements of this section, unless 
specified otherwise in your lease instrument. No initial payment is 
required when requesting noncompetitive ROW grants and RUE grants.
    (a) If you request a noncompetitive lease, you must submit an 
acquisition fee of $0.25 per acre, unless otherwise set by the 
Director, as provided in Sec.  585.500.
    (b) If BOEM determines there is no competitive interest, we will 
then:
    (1) Retain your acquisition fee if we issue you a lease; or
    (2) Refund your acquisition fee, without interest, if we do not 
issue your requested lease.
    (c) If we determine that there is a competitive interest in an area 
you requested, then we will proceed with a competitive lease sale 
process provided for in subpart C of this part, and we will:
    (1) Apply your acquisition fee to the required deposit for your bid 
amount if you submit a bid;
    (2) Apply your acquisition fee to your bonus bid if you acquire the 
lease; or
    (3) Retain your acquisition fee if you do not bid for or acquire 
the lease.


Sec.  585.503  What are the rent and operating fee requirements for a 
commercial lease?

    (a) The rent for a commercial lease is $3 per acre per year, unless 
otherwise established in the FSN or lease.
    (1) You must pay ONRR the first 12 months' rent no later than 45 
calendar days after you receive your copy of the executed lease from 
BOEM under Sec.  585.500(c)(3).
    (2) You must pay ONRR as provided in 30 CFR 1218.51 the rent due at 
the beginning of each subsequent 1-year period for the entire lease 
area until the facility begins commercial operations as specified in 
Sec.  585.506 or as otherwise specified in the FSN or lease:
    (i) For leases issued competitively, BOEM will specify in the FSN 
and lease any adjustment to the rent that will take effect during 
commercial operations but before the operations period.
    (ii) For leases issued noncompetitively, BOEM will specify in the 
lease any adjustment to the rent that will take effect during 
commercial operations but before the operations period.
    (3) You must pay ONRR as provided in 30 CFR 1218.51 the rent due 
for a project easement in addition to the lease rent as provided in 
Sec.  585.507. You must commence rent payments for your project 
easement upon BOEM's approval of your COP or GAP.
    (b) After your lease begins commercial operations, you must pay the 
operating fees in the amount specified in Sec.  585.506. Regardless of 
whether the lease is awarded competitively or noncompetitively, BOEM 
will specify in the lease when operating fees commence.


Sec.  585.504  How are my payments affected if I develop my commercial 
lease in phases?

    If you develop your commercial lease in phases as approved by BOEM 
in your COP under Sec.  585.238, you must pay ONRR as provided in 30 
CFR 1218.51:
    (a) Rent on the portion of the lease that has not commenced 
commercial operations.
    (b) Operating fees on the portion of the lease that has commenced 
commercial operations, in the amount specified in Sec.  585.506 and as 
described in Sec.  585.503(b).
    (c) Rent for a project easement in addition to lease rent, as 
provided in Sec.  585.507. You must commence rent payments for your 
project easement upon our approval of your COP.


Sec.  585.505  What are the rent and operating fee requirements for a 
limited lease?

    (a) The rent for a limited lease is $3 per acre per year, unless 
otherwise established in the Final Sale Notice and/or your lease 
instrument.
    (b) You must pay ONRR the initial 12 months' rent 45 days after you 
receive the lease copies from BOEM in accordance with the requirements 
provided in Sec.  585.500(c)(3).
    (c) You must pay ONRR as provided in 30 CFR 1218.51 the rent due at 
the beginning of each subsequent 1-year period on the entire lease area 
for the duration of your operations period.
    (d) BOEM will not charge an operating fee for the authorized sale 
of power from a limited lease.


Sec.  585.506  What operating fees must I pay on a commercial lease?

    Once you commence commercial operations, you must pay ONRR as 
provided in 30 CFR 1218.51 operating fees on your commercial lease as 
described in Sec.  585.503.
    (a) BOEM will determine the annual operating fee for activities 
relating to the generation of electricity on your lease based on the 
formula F = M * H * c * P * r, where:
    (1) F is the dollar amount of the annual operating fee;
    (2) M is the nameplate capacity expressed in megawatts;
    (3) H is the number of hours in a year, equal to 8,760, used to 
calculate an annual payment;
    (4) c is the ``capacity factor'' representing the anticipated 
efficiency of the facility's operation expressed as a decimal between 
zero and one;
    (5) P is a measure of the annual average wholesale electric power 
price expressed in dollars per megawatt hour, as provided in paragraph 
(c)(2) of this section; and
    (6) r is the operating fee rate expressed as a decimal between zero 
and one.
    (b) The annual operating fee formula relating to the value of 
annual electricity generation is restated as:

                                                                                   Equation 1 to Paragraph (b)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                M  (nameplate                                                    c  (capacity                                                 r  (operating fee
    F  (annual operating fee)         =           capacity)           *      H  (hours per year)      *            factor)            *        P  (power price)       *             rate)
 
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------


[[Page 42743]]

    (c) BOEM will specify operating fee parameters in the Final Sale 
Notice for commercial leases issued competitively and in the lease for 
those issued noncompetitively.
    (1) Unless BOEM specifies otherwise, the operating fee rate ``r'' 
is 0.02 for each year the operating fee applies when you begin 
commercial operations. We may apply a different fee rate for new 
projects (i.e., a new generation based on new technology) after 
considering factors such as program objectives, state of the industry, 
project type, and project potential. Also, we may agree to reduce or 
waive the fee rate under Sec.  585.510.
    (2) The power price ``P,'' for each year when the operating fee 
applies, will be determined annually. The process by which the power 
price will be determined will be specified in the Final Sale Notice 
and/or in the lease. BOEM:
    (i) Will use the most recent annual average wholesale power price 
in the State in which a project's transmission cables make landfall, as 
published by the Department of Energy (DOE), Energy Information 
Administration (EIA), or other publicly available wholesale power price 
indices; and
    (ii) May adjust the published average wholesale power price to 
reflect documented variations by State or within a region and recent 
market conditions.
    (3) BOEM will select the capacity factor ``c'' based upon 
applicable analogs drawn from present and future domestic and foreign 
projects that operate in comparable conditions and on comparable 
scales.
    (i) Upon the completion of the first year of the operations period 
on a lease, BOEM may adjust the capacity factor as necessary (to 
accurately represent a comparison of actual production over a given 
period of time with the amount of power a facility would have produced 
if it had run at full capacity) in a subsequent year.
    (ii) After the first adjustment, BOEM may adjust the capacity 
factor (to accurately represent a comparison of actual generation over 
a given period of time with the amount of power a facility would have 
generated if it had run at full capacity) no earlier than in 5-year 
intervals from the most recent year that BOEM adjusts the capacity 
factor.
    (iii) The process by which BOEM will adjust the capacity factor, 
including any calculations (incorporating an average capacity factor 
reflecting actual operating experience), will be specified in the 
lease. The operator or lessee may request review and adjustment of the 
capacity factor under Sec.  585.510.
    (4) For the nameplate capacity ``M,'' BOEM will use the total 
installed capacity of the equipment you install, as specified in your 
approved COP.
    (d) You must submit all operating fee payments to ONRR in 
accordance with the provisions under 30 CFR 1218.51.
    (e) BOEM will establish the operating fee in the Final Sale Notice 
or in the lease on a case-by-case basis for:
    (1) Activities that do not relate to the generation of electricity 
(e.g., hydrogen production); and
    (2) Leases issued for hydrokinetic activities requiring a FERC 
license.


Sec.  585.507  What rent payments must I pay on a project easement?

    (a) You must pay rent to ONRR as provided in 30 CFR 1218.51 for 
your project easement in the amount of $5 per acre, subject to a 
minimum of $450 per year, unless specified otherwise in the lease.
    (1) The size of the project easement will be determined according 
to Sec.  85.628(g)(1).
    (2) The size of a project easement area for an accessory platform 
is limited to the areal extent of anchor chains and other facilities 
and devices associated with the accessory.
    (b) You must commence rent payments for your project easement upon 
our approval of your COP or GAP:
    (1) You must make the first rent payment as provided in Sec.  
585.500;
    (2) You must submit all subsequent rent payments in accordance with 
the regulations at 30 CFR 1218.51; and
    (3) You must continue to pay annual rent for your project easement 
until your lease is terminated.


Sec.  585.508  What rent payments must I pay on ROW grants or RUE 
grants associated with renewable energy projects?

    (a) For each ROW grant BOEM approves under subpart D of this part, 
you must pay annual rent of $5 per acre to ONRR as provided in 30 CFR 
1218.51 and as determined by Sec.  585.301(a), but in no case less than 
$450, for use of the grant, unless specified otherwise in the grant.
    (b) For each RUE grant BOEM approves under subpart D of this part, 
you must pay rent to ONRR as provided in 30 CFR 1218.51 in the amount 
of:
    (1) $5 per acre per year; or
    (2) A minimum of $450 per year.
    (c) You must make the rent payments required by paragraphs (a) and 
(b) of this section on:
    (1) An annual basis;
    (2) For a 5-year period; or
    (3) For multiples of 5 years.
    (d) You must make the first annual rent payment upon approval of 
your ROW grant or RUE grant request, as provided in Sec.  585.500, and 
all subsequent rent payments to ONRR in accordance with the regulations 
at 30 CFR 1218.51.


Sec.  585.509  Who is responsible for submitting lease or grant 
payments to ONRR?

    (a) For each lease, ROW grant, or RUE grant issued under this part, 
you must identify one person who is responsible for all payments due 
and payable under the provisions of the lease or grant. The responsible 
person identified is designated as the payor, and you must document 
acceptance of such responsibilities, as provided in 30 CFR 1218.52.
    (b) All payors must submit payments and maintain auditable records 
in accordance with guidance we issue or any applicable regulations in 
subchapter A of this chapter. In addition, the lessee or grant holder 
must also maintain such auditable records.


Sec.  585.510  May BOEM defer, reduce, or waive my lease or grant 
payments?

    (a) The BOEM Director may defer, reduce, or waive the rent or 
operating fee or components of the operating fee, such as the fee rate 
or capacity factor, when the Director determines that continued 
activities would be uneconomic without the requested deferral, 
reduction, or waiver, or that it is necessary to encourage continued or 
additional activities.
    (b) When requesting a deferral, reduction, or waiver, you must 
submit an application to BOEM that includes all of the following:
    (1) The number of the lease, ROW grant, or RUE grant involved;
    (2) Name of each lessee or grant holder of record;
    (3) Name of each operator;
    (4) A demonstration that:
    (i) Continued activities would be uneconomic without the requested 
deferral, reduction, or waiver; or
    (ii) A deferral, reduction, or waiver is necessary to encourage 
additional activities; and
    (5) Any other information required by the Director.
    (c) No more than 6 years of your operations period will be subject 
to a full waiver of the operating fee.

[[Page 42744]]

Sec. Sec.  585.511-585.515   [Reserved]

Financial Assurance Requirements for Commercial Leases


Sec.  585.516  What are the financial assurance requirements for each 
stage of my commercial lease?

    (a) The financial assurance requirements for each stage of your 
commercial lease are:

------------------------------------------------------------------------
    Before BOEM will . . .               You must provide . . .
------------------------------------------------------------------------
(1) Execute a commercial       A bond or other authorized financial
 lease or approve an            assurance in the amount of 12 months'
 assignment of an existing      rent.
 commercial lease..
(2) Allow you to install       A supplemental bond or other authorized
 facilities approved in your    financial assurance in an amount
 SAP.                           determined by BOEM based on the
                                anticipated decommissioning costs of the
                                proposed facilities.
(3) Allow you to install       A supplemental bond or other authorized
 facilities approved in your    financial assurance in an amount
 COP.                           determined by BOEM based on anticipated
                                decommissioning costs of the proposed
                                facilities. If you propose to
                                incrementally fund your financial
                                assurance instrument, BOEM must approve
                                the schedule for providing the
                                appropriate financial assurance.
------------------------------------------------------------------------

    (b) Each bond or other authorized financial assurance must 
guarantee compliance with this part, the applicable plan approvals, and 
the terms and conditions of the lease.
    (c) For hydrokinetic commercial leases, supplemental financial 
assurance may be required in an amount determined by BOEM prior to 
installation of facilities pursuant to a FERC license.


Sec.  585.517  How will BOEM determine the supplemental financial 
assurance associated with commercial leases?

    (a) BOEM determines the amount of your supplemental financial 
assurance based on the estimated costs to meet all accrued lease 
obligations, including:
    (1) The projected amount of annual rent and other payments due to 
the United States over the next 12 months, to the extent that amount is 
not covered in the initial financial assurance provided in Sec.  
585.516(a)(1);
    (2) Any past due rent and other payments;
    (3) Other monetary obligations; and
    (4) The estimated cost of facility decommissioning, as required by 
30 CFR part 285, subpart I.
    (b) If your cumulative potential obligations and liabilities 
increase or decrease, we may adjust the amount of the supplemental 
financial assurance.
    (1) If we propose adjusting your financial assurance amount, we 
will notify you of the proposed adjustment and give you an opportunity 
to comment; and
    (2) We may approve a reduced financial assurance amount if you 
request it and if the reduced amount that you request is sufficient to 
cover your obligations and liabilities calculated under paragraph (a) 
of this section.


Sec. Sec.  585.518-585.519  [Reserved]

    Financial Assurance for Limited Leases, ROW Grants, and RUE Grants


Sec.  585.520  What financial assurance must I provide when I obtain my 
limited lease, ROW grant, or RUE grant?

    Before BOEM will execute your limited lease, ROW grant, or RUE 
grant, or approve an assignment of an interest therein, you or a 
proposed assignee must guarantee compliance with all terms and 
conditions of the lease or grant by providing a bond or other 
authorized financial assurance in the amount of 12 months' rent.


Sec.  585.521  Do my financial assurance requirements change as 
activities progress on my limited lease or grant?

    (a) BOEM may require you to increase or allow you to decrease the 
amount of your financial assurance as activities progress on your 
limited lease or grant based on the estimated costs to meet all accrued 
lease or grant obligations.
    (b) The total amount of the financial assurance must be no less 
than the amount required to meet your limited lease and grant 
obligations, including:
    (1) The projected amount of rent and other payments due to the 
United States over the next 12 months;
    (2) Any past due rent and other payments;
    (3) Other monetary obligations; and
    (4) The estimated cost of facility decommissioning as required by 
30 CFR part 285, subpart I.
    (c) If BOEM proposes adjusting the amount of your financial 
assurance to ensure your limited lease and grant obligations are met, 
BOEM will notify you of the proposed adjustment and will provide you an 
opportunity to object.
    (d) You may submit a written request to BOEM to reduce the amount 
of your financial assurance if your proposed amount is not less than 
the sum of your obligations listed in paragraph (b) of this section. 
BOEM may approve your request in its discretion.
    (e) You may satisfy the requirement for increased financial 
assurance on your limited lease or grant by increasing the amount of 
your existing bond or by providing a supplemental bond or other 
financial assurance.
    (1) The supplemental bond or other financial assurance must meet 
the requirements specified in Sec. Sec.  585.525 through 585.529.
    (2) If you propose to incrementally fund your financial assurance, 
BOEM must approve the schedule for providing the appropriate financial 
assurance.


Sec. Sec.  585.522-585.524  [Reserved]

Requirements for Financial Assurance Instruments


Sec.  585.525  What general requirements must a financial assurance 
instrument meet?

    (a) Any bond or other acceptable financial assurance instrument 
that you provide must:
    (1) Be payable to BOEM upon demand; and
    (2) Guarantee compliance of all lessees, grant holders, operators, 
and payors with all terms and conditions of the lease or grant, any 
subsequent approvals and authorizations, and all applicable 
regulations.
    (b) All bonds and other forms of financial assurance must be on or 
in a form approved by BOEM. You may submit this on an approved form 
that you have reproduced or generated by use of a computer. If the 
document you submit omits any terms and conditions that are included on 
the BOEM-approved form, your bond is deemed to

[[Page 42745]]

contain the omitted terms and conditions.
    (c) Surety bonds must be issued by an approved surety listed in the 
current Treasury Circular 570, as required by 31 CFR 223.16. You may 
obtain a copy of Circular 570 from the Treasury website at https://www.fiscal.treasury.gov/surety-bonds/circular-570.html.
    (d) Your surety bond cannot exceed the underwriting limit listed in 
the current Treasury Circular 570, except as permitted therein.
    (e) You and a qualified surety must execute your bond. When the 
surety is a corporation, an authorized corporate officer must sign the 
bond and attest to it over the corporate seal.
    (f) You may not terminate the period of liability of your bond or 
cancel your bond, except as provided in this subpart. Bonds must 
continue in full force and effect even though an event has occurred 
that could diminish or terminate a surety's obligation under State law.
    (g) Your surety must notify you and BOEM within 5 business days 
after:
    (1) It initiates any judicial or administrative proceeding alleging 
its insolvency or bankruptcy; or
    (2) The Treasury decertifies the surety.


Sec.  585.526  What instruments other than a surety bond may I use to 
meet the financial assurance requirement?

    (a) You may use other types of security instruments, if BOEM 
determines that such security protects BOEM to the same extent as the 
surety bond. BOEM will consider pledges of the following:
    (1) U.S. Department of Treasury securities identified in 31 CFR 
part 225;
    (2) A pledge of cash, in an amount equal to the required dollar 
amount of the financial assurance, to be deposited and maintained in a 
Federal depository account of the U.S. Treasury;
    (3) Certificates of deposit or savings accounts in a bank or 
financial institution organized or authorized to transact business in 
the United States with:
    (i) Minimum net assets of $500,000,000; and
    (ii) Minimum Bankrate.com Safe & Sound rating of 3 Stars, and 
Capitalization, Assets, Equity and Liquidity (CAEL) rating of 3 or 
less;
    (4) Negotiable U.S. Government, State, and municipal securities or 
bonds having a market value of not less than the required dollar amount 
of the financial assurance and maintained in a Securities Investors 
Protection Corporation insured trust account by a licensed securities 
brokerage firm for the benefit of BOEM;
    (5) Investment-grade rated securities having a Standard and Poor's 
rating of AAA or an equivalent rating from a nationally recognized 
securities rating service having a market value of not less than the 
required dollar amount of the financial assurance and maintained in a 
Securities Investors Protection Corporation insured trust account by a 
licensed securities brokerage firm for the benefit of BOEM;
    (6) Insurance, if its form and function is such that the funding or 
enforceable pledges of funding are used to guarantee performance of 
regulatory obligations in the event of default on such obligations by 
the lessee. Insurance must have an A.M. Best rating of ``superior'' or 
an equivalent rating from a nationally recognized insurance rating 
service;
    (7) Letters of credit, subject to the following conditions:
    (i) The letter of credit provider must have an issuer credit rating 
from a Nationally Recognized Statistical Rating Organization (NRSRO) 
greater than or equal to investment grade from either Standard & Poor's 
Ratings Service or Moody's Investor Service, or a proxy credit rating 
determined by BOEM based on audited financial information (including an 
income statement, balance sheet, statement of cash flows, and the 
auditor's certificate) greater than or equal to investment grade from 
either Standard & Poor's Ratings Service or Moody's Investor Service;
    (ii) The letter of credit must grant BOEM full authority to demand 
immediate payment in case of default in the performance of the terms 
and conditions of a lease or regulatory obligations;
    (iii) The letter of credit must be irrevocable during its term and 
will be subject to collection by BOEM if not replaced by another letter 
of credit or other form of financial assurance at least 30 calendar 
days before its expiration date;
    (iv) The expiration date of the letter of credit must not be less 
than 90 days following the date it becomes effective;
    (v) The letter of credit must contain a provision for automatic 
renewal for periods of not less than 1 year in the absence of notice of 
cancellation to BOEM at least 90 calendar days before the expiration 
date; and
    (vi) The letter of credit must contain a venue provision, which 
requires any disputes to be adjudicated in a U.S. Federal court that is 
mutually agreed upon by BOEM and the issuers of the letter of credit;
    (8) Another form of security approved by BOEM in its discretion; or
    (9) A combination of security instruments described in paragraphs 
(a)(1) through (8) of this section.
    (b) If you use a Treasury security:
    (1) You must post 115 percent of your financial assurance amount;
    (2) You must monitor the collateral value of your security. If the 
collateral value of your security as determined in accordance with 31 
CFR part 203, Collateral Margins Table (which can be found at https://www.treasurydirect.gov), falls below the required level of coverage, 
you must pledge additional security to provide 115 percent of the 
required amount; and
    (3) You must include with your pledge authority for us to sell the 
security and use the proceeds if we determine that you have failed to 
comply with any of the terms and conditions of your lease or grant, any 
subsequent approval or authorization, or applicable regulations.
    (c) If you use the instruments described in paragraph (a)(4) or (5) 
of this section, you must provide BOEM by the end of each calendar year 
a certified statement describing the nature and market value of the 
instruments maintained in that account, and including any current 
statements or reports furnished by the brokerage firm to the lessee 
concerning the asset value of the account.


Sec.  585.527  May I demonstrate financial strength and reliability to 
meet the financial assurance requirement for lease or grant activities?

    BOEM may allow you to use your financial strength and reliability 
to meet financial assurance requirements if:
    (a) You have an investment grade issuer credit rating. If any 
Securities and Exchange Commission (SEC)-recognized NRSRO provides a 
credit rating that differs from any other SEC-recognized NRSRO credit 
rating, BOEM will apply the highest rating for the purposes of 
determining your financial assurance requirements.
    (b) You have a proxy credit rating determined by BOEM, which must 
be based on audited financial information for the most recent fiscal 
year (which must include an income statement, balance sheet, statement 
of cash flows, and the auditor's certificate).
    (1) The audited financial information for your most recent fiscal 
year must cover a continuous twelve-month period within the twenty-
four-month period prior to the lessee's receipt of the determination 
that you must provide supplemental financial assurance.
    (2) In determining your proxy credit rating, BOEM may include the 
value of the offshore decommissioning liabilities

[[Page 42746]]

associated with any lease(s) or grants in which you have an ownership 
interest. Upon BOEM's request, you must provide the information that 
BOEM determines is necessary to properly evaluate your offshore 
decommissioning liabilities, including joint ownership interests and 
liabilities associated with your OCS leases and grants.
    (c) Your co-lessee or co-grant-holder has an issuer credit rating 
or a proxy credit rating that meets the criteria set forth in paragraph 
(a) of this section; however, BOEM may require you to provide financial 
assurance for decommissioning obligations for which such co-lessee or 
co-grant-holder is not liable.
    (d) You have a contract with a counterparty that projects net 
income will exceed three times the estimated decommissioning expenses 
associated with the facilities that will generate that income.
    (e) If we approve your request to use your financial strength and 
reliability to meet your financial assurance requirements, you must 
submit annual updates.
    (f) If the annual updates do not continue to demonstrate financial 
strength and reliability or BOEM has reason to believe that you are 
unable to meet the requirements of this section, after notice and 
opportunity for a hearing, BOEM will terminate your ability to use 
financial strength and reliability for financial assurance and require 
you to provide another type of financial assurance. You must provide 
this new financial assurance instrument within 90 days after we 
terminate your use of financial strength and reliability.


Sec.  585.528  May I use a third-party guaranty to meet the financial 
assurance requirement for lease or grant activities?

    (a) You may use a third-party guaranty to secure all or part of the 
obligations for which financial assurance was demanded by BOEM if the 
guarantor:
    (1) Meets the credit rating or proxy credit rating criterion set 
forth in Sec.  [thinsp]585.527(a); and
    (2) Submits an agreement containing each of the provisions in 
paragraph (d) of this section.
    (b) A third-party guarantor may limit its cumulative obligations to 
a fixed dollar amount as agreed to by BOEM at the time the third-party 
guaranty is provided.
    (c) If, during the life of your third-party guaranty, your 
guarantor no longer meets the criterion referred to in paragraph (a)(1) 
of this section, you must:
    (1) Notify BOEM within 72 hours of so learning; and
    (2) Submit a surety bond or other financial assurance covering the 
obligations previously secured by the third-party guaranty.
    (d) Your guarantor must submit an agreement executed by the 
guarantor and all parties bound by the agreement. All parties are bound 
jointly and severally, and the guarantor must meet the legal and 
financial qualifications set forth in Sec. Sec.  585.107 and 585.108.
    (1) When any party is a corporation, two corporate officers 
authorized to execute the guaranty agreement on behalf of the 
corporation must sign the agreement.
    (2) When any party is a partnership, joint venture, or syndicate, 
the guaranty agreement must bind each party who has a beneficial 
interest in your guarantor and provide that, upon BOEM demand under 
your guaranty, each party is jointly and severally liable for 
compliance with all terms and conditions of your lease(s) or grant(s) 
covered by the agreement.
    (3) When forfeiture of the guaranty is called for, the agreement 
must provide that your guarantor will either bring your lease(s) or 
grant(s) into compliance or provide, within 7 days, sufficient funds to 
permit BOEM to complete corrective action.
    (4) The guaranty agreement must contain a confession of judgment, 
providing that, if BOEM determines that you or your operator is in 
default, the guarantor must not challenge the determination and must 
remedy the default.
    (5) If your guarantor wants to terminate the period of liability, 
your guarantor must notify you and BOEM at least 90 days before the 
proposed termination date, obtain BOEM's approval for termination of 
all or a specified portion of the guarantee for liabilities arising 
after that date, and remain liable for all your work performed during 
the period the agreement is in effect.
    (6) Each guaranty submitted pursuant to this section is deemed to 
contain all the terms described in in paragraphs (d)(1) through (5) of 
this section, even if they are not actually in the agreement.
    (e) Before the termination of your guaranty, you must provide an 
acceptable replacement in the form of a bond or other security.


Sec.  585.529  Can I use a lease- or grant-specific decommissioning 
account to meet the financial assurance requirements related to 
decommissioning?

    (a) In lieu of a surety bond, BOEM may authorize you to establish a 
lease-, ROW grant-, or RUE grant-specific decommissioning account in a 
federally insured institution. The funds may not be withdrawn from the 
account without our written approval.
    (1) The funds must be payable to BOEM and pledged to meet your 
lease or grant decommissioning and site clearance obligations;
    (2) You must fund the account in the amount determined by and 
according to the payment schedule approved by BOEM. BOEM will estimate 
the cost of decommissioning, including site clearance; and
    (3) Subject to BOEM's approval, a decommissioning account may be 
funded in whole or in part during the operations period of a lease or 
grant.
    (b) Any interest paid on the account will be treated as account 
funds unless we authorize in writing that any interest be paid to the 
depositor.
    (c) We may allow you to pledge Treasury securities, payable to BOEM 
on demand, to satisfy your obligation to make payments into the 
account. Acceptable Treasury securities and their collateral value are 
determined in accordance with 31 CFR part 203, Collateral Margins Table 
(which can be found at https://www.treasurydirect.gov).
    (d) We may require you to commit a specified stream of revenues as 
payment into the account so that the account will be fully funded, as 
prescribed in paragraph (a)(2) of this section. The commitment may 
include revenue from other operations.

Changes in Financial Assurance


Sec.  585.530  What must I do if my financial assurance lapses?

    (a) If your surety is decertified by the Treasury, becomes bankrupt 
or insolvent, or if your surety's charter or license is suspended or 
revoked, or if any other approved financial assurance expires for any 
reason, you must:
    (1) Inform BOEM within 3 business days about the financial 
assurance lapse; and
    (2) Provide new financial assurance in the amount set by BOEM, as 
provided in this subpart.
    (b) You must notify BOEM within 3 business days after you learn of 
any action filed alleging that you, your surety, or your third-party 
guarantor is insolvent or bankrupt.


Sec.  585.531  What happens if the value of my financial assurance is 
reduced?

    If the value of your financial assurance is reduced below the 
required financial assurance amount because of a default or any other 
reason, you must provide additional financial assurance

[[Page 42747]]

sufficient to meet the requirements of this subpart within 45 days or 
within a different period as specified by BOEM.


Sec.  585.532  What happens if my surety wants to terminate the period 
of liability of my financial assurance?

    (a) Terminating the period of liability of your financial assurance 
ends the period during which surety liability continues to accrue. The 
surety continues to be responsible for obligations and liabilities that 
accrued during the period of liability and before the date on which 
BOEM terminates the period of liability under paragraph (b) of this 
section. The liabilities that accrue during a period of liability 
include:
    (1) Obligations that started to accrue before the beginning of the 
period of liability and have not been met; and
    (2) Obligations that began accruing during the period of liability.
    (b) Your surety must submit to BOEM its request to terminate the 
period of liability under its financial assurance and notify you of 
that request no less than 90 days before the proposed termination date. 
If you intend to continue activities on your lease or grant, you must 
provide replacement financial assurance of equivalent or greater value. 
BOEM will terminate that period of liability within 90 days after BOEM 
receives the request.


Sec.  585.533  How does my surety obtain cancellation of my financial 
assurance?

    BOEM will allow a surety to cancel financial assurance and will 
relieve the surety from liability for accrued obligations on the 
earliest to occur of the following:
    (a) BOEM determines that there are no outstanding obligations 
covered by the financial assurance;
    (b) The following occurs:
    (1) BOEM accepts replacement financial assurance in an amount equal 
to or greater than the financial assurance to be cancelled to cover the 
period of liability prior to termination; or
    (2) The surety issuing the new financial assurance has expressly 
agreed to assume all outstanding liabilities under the original 
financial assurance that accrued during the period of liability that 
was terminated; and
    (c) Seven years have elapsed since the termination of the period of 
liability if the new surety did not assume the accrued obligations for 
the terminated period of liability, unless there are any appeals or 
judicial litigation related to your liabilities covered by the 
financial assurance.


Sec.  585.534  When may BOEM cancel my financial assurance?

    (a) When your lease or grant ends, your sureties remain 
responsible, and BOEM will cancel your financial assurance as shown in 
the following table:

----------------------------------------------------------------------------------------------------------------
         Financial assurance                  Your financial assurance will not be cancelled until . . .
----------------------------------------------------------------------------------------------------------------
(1) Financial assurance for           Seven years after all operations and activities under the lease or grant
 commercial leases submitted under     cease, including decommissioning and site clearance, or a longer period
 Sec.   585.516(a)(1) and for grants   as necessary to complete any appeals or judicial litigation related to
 or limited leases submitted under     your financial assurance obligation. BOEM may reduce or cancel your
 Sec.  Sec.   585.520 and 585.521.     financial assurance or return some or all of your security if BOEM
                                       determines that the full amount is no longer needed.
(2) Supplemental financial assurance  (i) The lease or grant expires or is terminated and BOEM determines you
 for commercial leases submitted       have met your secured obligations, unless BOEM:
 under Sec.   585.516 and for grants  (A) Determines that the future potential liability resulting from any
 or limited leases submitted under     undetected problem is greater than the amount of your lease-specific
 Sec.  Sec.   585.520 and 585.521.     financial assurance; and
                                      (B) Notifies the provider of the supplemental financial assurance that
                                       BOEM will wait 7 years before cancelling all or a part of the
                                       supplemental financial assurance (or longer period as necessary to
                                       complete any appeals or judicial litigation related to your secured
                                       obligations); or
                                      (ii) At any time when:
                                      (A) BOEM determines, in its discretion, that you no longer need to provide
                                       the supplemental financial assurance;
                                      (B) The operations for which the supplemental financial assurance was
                                       provided were cancelled before accrual of any decommissioning obligation;
                                       or
                                      (C) Cancellation of the supplemental financial assurance is appropriate
                                       because, under the regulations in this part, BOEM determines such
                                       financial assurance never should have been required.
----------------------------------------------------------------------------------------------------------------

    (b) BOEM may require reinstatement of your financial assurance as 
if no cancellation had occurred if:
    (1) A person makes a payment under the lease or grant, and the 
payment is rescinded or must be repaid by the recipient because the 
person making the payment is insolvent, bankrupt, subject to 
reorganization, or placed in receivership; or
    (2) The responsible party represents to BOEM that it has discharged 
its obligations under the lease or grant, and the representation was 
materially false when the financial assurance was cancelled.


Sec.  585.535  Why might BOEM call for forfeiture of my financial 
assurance?

    (a) BOEM may call for forfeiture of all or part of your financial 
assurance if:
    (1) After notice and demand for performance by BOEM, you refuse or 
fail, within the timeframe we prescribe, to comply with any term or 
condition of your lease or grant, other authorization or approval, or 
applicable regulations; or
    (2) You default on one of the conditions under which we accepted 
your financial assurance.
    (b) We may pursue forfeiture without first making demands for 
performance against any co-lessee or holder of an interest in your ROW 
or RUE, or other person approved to perform obligations under your 
lease or grant.


Sec.  585.536  How will I be notified of a call for forfeiture?

    (a) BOEM will notify you and your surety, including any provider of 
financial assurance, in writing of the call for forfeiture and provide 
the reasons for the forfeiture and the amount to be forfeited. We will 
base the amount upon an estimate of the total cost of corrective action 
to bring your lease or grant into compliance.
    (b) We will advise you and your surety that you may avoid 
forfeiture if, within 10 business days:
    (1) You agree to and demonstrate in writing to BOEM that you will 
bring your lease or grant into compliance within the timeframe we 
prescribe, and you do so; or

[[Page 42748]]

    (2) Your surety agrees to and demonstrates that it will bring your 
lease or grant into compliance within the timeframe we prescribe, even 
if the cost of compliance exceeds the face amount of the bond.


Sec.  585.537  How will BOEM proceed once my bond or other security is 
forfeited?

    (a) If BOEM determines that your bond or other security is 
forfeited, we will collect the forfeited amount and use the funds to 
bring your lease or grant(s) into compliance and correct any default.
    (b) If the amount collected under your bond or other security is 
insufficient to pay the full cost of corrective action, BOEM may take 
or direct action to obtain full compliance and recover all costs in 
excess of the forfeited bond from you or any co-lessee or co-grantee.
    (c) If the amount collected under your bond or other security 
exceeds the full cost of corrective action to bring your lease or 
grant(s) into compliance, we will return the excess funds to the party 
from whom the excess was collected.


Sec. Sec.  585.538-585.539  [Reserved]

Revenue Sharing With States


Sec.  585.540  How will BOEM equitably distribute revenues to States?

    (a) BOEM will distribute among the eligible coastal States 27 
percent of the following revenues derived from qualified projects, 
where a qualified project and qualified project area is determined in 
Sec.  585.541 and an eligible State is determined in Sec.  585.542, 
where a qualified project and qualified project area are determined in 
585.541 and an eligible State is defined in Sec.  585.113. Revenues 
subject to distribution to eligible States include all bonuses, 
acquisition fees, rentals, and operating fees derived from the entire 
qualified project area and associated project easements and are not 
limited to revenues attributable to the portion of the project area 
within 3 miles of the seaward boundary of a coastal State. The revenues 
to be shared do not include administrative fees such as service fees 
and those assessed for civil penalties and forfeiture of bond or other 
surety obligations.
    (b) The project area is the area included within a single lease or 
grant. For each qualified project, BOEM will determine and announce the 
project area and its geographic center at the time it grants or issues 
a lease, easement, or right-of-way on the OCS. If a qualified project 
lease or grant's boundaries change significantly due to actions 
pursuant to Sec.  585.435 or Sec.  585.436, BOEM will re-evaluate the 
project area to determine whether the geographic center has changed. If 
it has, BOEM will re-determine State eligibility and shares 
accordingly.
    (c) To determine each eligible State's share of the 27 percent of 
the revenues for a qualified project, BOEM will use the inverse 
distance formula, which apportions shares according to the relative 
proximity of the nearest point on the coastline of each eligible State 
to the geographic center of the qualified project area. If 
Si is equal to the nearest distance from the geographic 
center of the project area to the i = 1, 2, * * * nth eligible State's 
coastline, then eligible State i would be entitled to the fraction 
Fi of the 27-percent aggregate revenue share due to all the 
eligible States according to the following formula:
    Formula 1 to paragraph (c)

Fi = (1/Si) / ([Sigma]i=1* * 
*n(1/Si))


Sec.  585.541  What is a qualified project for revenue sharing 
purposes?

    A qualified project for the purpose of revenue sharing with 
eligible coastal States is one authorized under subsection 8(p) of the 
OCS Lands Act, which includes acreage within the area extending 3 miles 
seaward of State submerged lands. A qualified project is subject to 
revenue sharing with those States that are eligible for revenue sharing 
under Sec.  585.542. The entire area within a lease or grant for the 
qualified project, excluding project easements, is considered the 
qualified project area.


Sec.  585.542  What makes a State eligible for payment of revenues?

    A State is eligible for payment of revenues if any part of the 
State's coastline is located within 15 miles of the announced 
geographic center of the project area of a qualified project. A State 
is not eligible for revenue sharing if all parts of that State's 
coastline are more than 15 miles from the announced geographic center 
of the qualified project area. This is the case even if the qualified 
project area is located wholly or partially within an area extending 3 
miles seaward of the submerged lands of that State or if there are no 
States with a coastline less than 15 miles from the announced 
geographic center of the qualified project area.


Sec.  585.543  Example of how the inverse distance formula works.

    (a) Assume that the geographic center of the project area lies 12 
miles from the closest coastline point of State A and 4 miles from the 
closest coastline point of State B. BOEM will round dollar shares to 
the nearest whole dollar. The proportional share due each State would 
be calculated as follows:
    (1) State A's share = [(1/12) / (1/12 + 1/4)] = 1/4.
    (2) State B's share = [(1/4) / (1/12 + 1/4)] = 3/4.
    (b) Therefore, State B would receive a share of revenues that is 
three times as large as that awarded to State A, based on the finding 
that State B's nearest coastline is one-third the distance to the 
geographic center of the qualified project area as compared to State 
A's nearest coastline. Eligible States share the 27 percent of the 
total revenues from the qualified project as mandated under the OCS 
Lands Act. Hence, if the qualified project generates $1,000,000 of 
Federal revenues in a given year, the Federal Government would 
distribute the States' 27-percent share as follows:
    (1) State A's share = $270,000 x 1/4 = $67,500.
    (2) State B's share = $270,000 x 3/4 = $202,500.


Sec. Sec.  585.544-585.599  [Reserved]

0
51. Revise subpart G to read as follows:

Subpart G--Plans and Information Requirements

Sec.
585.600 What plans must I submit to BOEM before I conduct activities 
on my lease or grant?
585.601 When must I submit my plans to BOEM?
585.602-585.604 [Reserved]

Site Assessment Plan and Information Requirements for Commercial Leases

585.605 What is a Site Assessment Plan (SAP)?
585.606 What must I demonstrate in my SAP?
585.607 How do I submit my SAP?
585.608-585.609 [Reserved]

Contents of the Site Assessment Plan

585.610 What must I include in my SAP?
585.611 What information and certifications must I submit with my 
SAP to assist BOEM in complying with NEPA and other applicable laws?
585.612 How will my SAP be processed for Federal consistency under 
the Coastal Zone Management Act?
585.613 How will BOEM process my SAP?

Activities Under an Approved SAP

585.614 When may I begin conducting activities under my approved 
SAP?
585.615 What other reports or notices must I submit to BOEM under my 
approved SAP?
585.616 [Reserved]
585.617 What activities require a revision to my SAP, and when will 
BOEM approve the revision?
585.618 What must I do upon completion of approved site assessment 
activities?
585.619 [Reserved]

Construction and Operations Plan for Commercial Leases

585.620 What is a Construction and Operations Plan (COP)?

[[Page 42749]]

585.621 What must I demonstrate in my COP?
585.622 How do I submit my COP?
585.623-585.625 [Reserved]

Contents of the Construction and Operations Plan

585.626 What must I include in my COP?
585.627 What information and certifications must I submit with my 
COP to assist BOEM in complying with NEPA and other applicable laws?
585.628 How will BOEM process my COP?
585.629-585.630 [Reserved]

Activities Under an Approved COP

585.631 When must I initiate activities under an approved COP?
585.632 What documents must I submit before I may construct and 
install facilities under my approved COP?
585.633 [Reserved]
585.634 What activities require a revision to my COP, and when will 
BOEM approve the revision?
585.635 What must I do if I cease activities approved in my COP 
before the end of my commercial lease?
585.636-585.639 [Reserved]

General Activities Plan Requirements for Limited Leases, ROW Grants, 
and RUE Grants

585.640 What is a General Activities Plan (GAP)?
585.641 What must I demonstrate in my GAP?
585.642 How do I submit my GAP?
585.643-585.644 [Reserved]

Contents of the General Activities Plan

585.645 What must I include in my GAP?
585.646 What information and certifications must I submit with my 
GAP to assist BOEM in complying with NEPA and other applicable laws?
585.647 How will my GAP be processed for Federal consistency under 
the Coastal Zone Management Act?
585.648 How will BOEM process my GAP?
585.649 [Reserved]

Activities Under an Approved GAP

585.650 When may I begin conducting activities under my GAP?
585.651 When may I construct complex or significant OCS facilities 
on my limited lease or any facilities on my project easement 
proposed under my GAP?
585.652 How long do I have to conduct activities under an approved 
GAP?
585.653 What other reports or notices must I submit to BOEM under my 
approved GAP?
585.654 [Reserved]
585.655 What activities require a revision to my GAP, and when will 
BOEM approve the revision?
585.656 What must I do if I cease activities approved in my GAP 
before the end of my term?
585.657 What must I do upon completion of approved activities under 
my GAP?

Cable and Pipeline Deviations

585.658 Can my cable or pipeline construction deviate from my 
approved COP or GAP?
585.659-585.699 [Reserved]

Environmental Protection Requirements Under Approved Plans

585.700 What requirements must I include in my SAP, COP, or GAP 
regarding air quality?
585.701 How must I conduct my approved activities to protect marine 
mammals, threatened and endangered species, and designated critical 
habitat?
585.702 What must I do if I discover a potential archaeological 
resource while conducting my approved activities?
585.703 How must I conduct my approved activities to protect 
essential fish habitats identified and described under the Magnuson-
Stevens Fishery Conservation and Management Act?

Subpart G--Plans and Information Requirements


Sec.  585.600  What plans must I submit to BOEM before I conduct 
activities on my lease or grant?

    (a) You must submit a SAP, COP, or GAP and receive BOEM approval 
before you conduct activities on your lease or grant as set forth in 
the following table:

------------------------------------------------------------------------
                                             You must submit and obtain
                Before you:                      approval for your:
------------------------------------------------------------------------
(1) Conduct site assessment activities on   SAP under Sec.  Sec.
 your commercial lease, such as              585.605 through 585.613.
 meteorological towers or other facilities
 that are installed on the seabed using a
 fixed-bottom foundation requiring
 professional engineering design and
 assessment of sediment, meteorological,
 and oceanographic conditions as part of
 the design.
(2) Conduct any activities pertaining to    COP under Sec.  Sec.
 construction of facilities for commercial   585.620 through 585.628.
 operations on your commercial lease.
(3) Conduct any activities on your limited  GAP under Sec.  Sec.
 lease or grant in any OCS area.             585.640 through 585.648.
------------------------------------------------------------------------

    (b) BOEM may waive certain types of information or analyses that 
you otherwise must provide in your proposed plan when you demonstrate 
that:
    (1) Sufficient applicable information or analysis is readily 
available to BOEM;
    (2) The coastal or marine resources that are the subject of the 
information requirement are not present or affected;
    (3) Other factors affect your ability to obtain or BOEM's need for 
the required information; or
    (4) Information is neither necessary nor required for a State to 
determine consistency with its coastal management program.


Sec.  585.601  When must I submit my plans to BOEM?

    (a) You may submit your SAP anytime; however, your SAP must be 
submitted to and approved by BOEM before you conduct activities 
requiring a SAP under Sec.  585.600(a)(1).
    (b) You must submit your COP by the end of the preliminary period 
of your commercial lease in accordance with Sec.  585.235.
    (1) Your COP must contain sufficient data and information for BOEM 
to complete its reviews and NEPA analysis.
    (2) BOEM may need to conduct additional reviews of your COP, 
including environmental analysis under NEPA, if significant new 
information becomes available from your site assessment and 
characterization activities or if you substantially revise your COP. As 
a result of the additional reviews, BOEM may require that you revise 
your COP.
    (c) You must submit your GAP by the end of the preliminary period 
for your limited lease in accordance with Sec.  585.236, or the 
preliminary period for your grant in accordance with Sec.  585.303.


Sec. Sec.  585.602-585.604  [Reserved]

Site Assessment Plan and Information Requirements for Commercial Leases


Sec.  585.605  What is a Site Assessment Plan (SAP)?

    (a) A SAP describes the site assessment activities meeting the 
criteria in Sec.  585.600(a)(1) that you plan to perform on your 
commercial lease.
    (b) You must receive BOEM approval of your SAP, as provided in 
Sec.  585.613, before you can begin any proposed site assessment 
activities requiring such approval.
    (c) If BOEM determines that your proposed site assessment facility 
or combination of facilities is complex or significant under Sec.  
585.613(a)(1), you must comply with the requirements in 30 CFR part 
285, subpart G, regarding

[[Page 42750]]

facility design and construction and submit your SMS as required by 30 
CFR 285.810.


Sec.  585.606  What must I demonstrate in my SAP?

    Your SAP must demonstrate that you have planned and are prepared to 
conduct the proposed site assessment activities in a manner that:
    (a) Conforms to your responsibilities listed in Sec.  585.105(a);
    (b) Conforms to all applicable laws, regulations, and provisions of 
your commercial lease;
    (c) Is safe;
    (d) Does not unreasonably interfere with other uses of the OCS, 
including those involved with national security or defense;
    (e) Does not cause undue harm or damage to natural resources; life 
(including human and wildlife); property; the marine, coastal, or human 
environment; or sites, structures, or objects of historical or 
archaeological significance;
    (f) Uses best available and safest technology;
    (g) Uses best management practices; and
    (h) Uses properly trained personnel.


Sec.  585.607  How do I submit my SAP?

    You must submit your SAP to BOEM pursuant to Sec.  585.111.


Sec. Sec.  585.608-585.609   [Reserved]

Contents of the Site Assessment Plan


Sec.  585.610  What must I include in my SAP?

    (a) Project information may be provided using a PDE. When you 
provide information using a PDE, BOEM reserves the right to determine 
what range of values for any given parameter is acceptable. Your SAP 
must include the following project-specific information, as applicable:

------------------------------------------------------------------------
       Project information:                      Including:
------------------------------------------------------------------------
(1) Contact information...........  The name, address, email address,
                                     and phone number of an authorized
                                     representative.
(2) The site assessment or          A discussion of the objectives;
 technology testing concept.         description of the proposed
                                     activities, including the
                                     technology you will use; and
                                     proposed schedule from start to
                                     completion.
(3) Designation of operator, if     As provided in Sec.   585.405.
 applicable.
(4) Commercial lease stipulations   A description of the measures you
 and compliance.                     took, or will take, to satisfy the
                                     conditions of any lease
                                     stipulations related to your
                                     proposed activities.
(5) A location plat, or indicative  The range of surface locations and
 layout.                             associated water depths for
                                     proposed structures, facilities,
                                     and appurtenances located both
                                     offshore and onshore, including all
                                     anchor and mooring data; and the
                                     location and associated water
                                     depths of all existing structures.
(6) General structural and project  For facilities deemed complex or
 design, fabrication, and            significant you must provide
 installation.                       preliminary design information for
                                     each facility associated with your
                                     site assessment activity and
                                     subpart G of 30 CFR part 285
                                     applies. For facilities not deemed
                                     complex or significant you must
                                     provide final design information.
(7) Deployment activities.........  A description of the safety,
                                     prevention, and environmental
                                     protection features or measures
                                     that you will use.
(8) Your proposed measures for      A description of the measures you
 avoiding, minimizing, reducing,     will use to avoid or minimize
 eliminating, and monitoring         adverse effects and any potential
 environmental impacts.              incidental take, before you conduct
                                     activities on your lease, and how
                                     you will mitigate environmental
                                     impacts from your proposed
                                     activities, including a description
                                     of the measures you will use as
                                     required by Sec.  Sec.   585.700
                                     through 585.703.
(9) Project verification strategy.  An analysis supporting your
                                     recommendation as to whether your
                                     site assessment activities should
                                     be determined complex or
                                     significant. If your recommendation
                                     supports a complex or significant
                                     determination, describe your
                                     strategy for compliance with 30 CFR
                                     285.705 through 285.714.
(10) References...................  A bibliographic list of any document
                                     or published source that you cite
                                     as part of your plan. You may
                                     reference information and data
                                     discussed in other plans that you
                                     previously submitted or that are
                                     otherwise readily available to
                                     BOEM.
(11) Decommissioning and site       A discussion of general concepts and
 clearance procedures.               methodologies.
(12) Air quality information......  Information as described in Sec.
                                     585.700.
(13) A listing of all Federal,      A statement indicating whether you
 State, and local authorizations     have applied for or obtained such
 or approvals required to conduct    authorization or approval from the
 site assessment activities.         U.S. Coast Guard, U.S. Army Corps
                                     of Engineers, and any other
                                     applicable Federal, State, or local
                                     authorizers.
(14) A list of agencies and         Contact information and issues
 persons with whom you have          discussed.
 communicated, or with whom you
 will communicate, regarding
 potential impacts associated with
 your proposed activities.
(15) Financial assurance            Statements attesting that the
 information.                        activities and facilities proposed
                                     in your SAP are or will be covered
                                     by an appropriate bond or other
                                     approved financial assurance
                                     instrument as required in Sec.
                                     585.516 and Sec.  Sec.   585.525
                                     through 585.529.
(16) Information you incorporate    A list of the documents you have
 by reference.                       incorporated by reference and their
                                     public availability.
(17) Other information............  Additional information as required
                                     by BOEM.
------------------------------------------------------------------------

    (b) You must include reports that document the results of surveys 
and investigations that characterize and model the site of your 
proposed assessment activities. Your reports must address the following 
topics:

[[Page 42751]]



----------------------------------------------------------------------------------------------------------------
               Topic:                     Purpose of report:                        Including:
----------------------------------------------------------------------------------------------------------------
(1) Geological and geotechnical....  To define the baseline       (i) Desktop studies to collect available data
                                      geological conditions of     from published sources and nearby sites.
                                      the seabed and provide      (ii) Geophysical surveys of the proposed area
                                      sufficient data to develop   with sufficient areal coverage, depth
                                      a geologic model, assess     penetration, and resolution to define the
                                      geologic hazards, and        geological conditions of the seabed at the
                                      determine the feasibility    site that could impact, or be impacted by,
                                      of the proposed site for     your proposed site assessment activities.
                                      your assessment facility.   (iii) Geotechnical investigations of
                                                                   sufficient scope and detail to: ground truth
                                                                   the geophysical surveys; support development
                                                                   of a geological model; assess potential
                                                                   geological hazards that could impact the
                                                                   proposed site assessment activities; and
                                                                   provide geotechnical data for design of the
                                                                   site assessment facility, including type and
                                                                   approximate dimensions of the foundation.
                                                                  (iv) An overall site characterization report
                                                                   for your site assessment facility that
                                                                   integrates the findings of your studies,
                                                                   surveys, and investigations; describes the
                                                                   geological model; contains supporting data
                                                                   and findings; and states your
                                                                   recommendations.
(2) Biological.....................  To determine the presence    A description of the results of surveys used
                                      of biological features and   to evaluate the spatial and temporal
                                      marine resources.            distribution and abundance of biological
                                                                   species in the site area, including migratory
                                                                   and non-migratory species of vertebrate
                                                                   animals such as fish, marine mammals, sea
                                                                   turtles, and coastal and marine birds;
                                                                   invertebrate animals; plants; algae; and
                                                                   other organisms; also including the presence
                                                                   of live bottoms, hard bottoms, topographic
                                                                   features, and other marine resources.
(3) Archaeological resources and     To provide BOEM with         Archeological resource and other historic
 other historic properties.           required information to      property identification surveys with
                                      conduct review of your SAP   supporting data.
                                      under NHPA.
(4) Meteorological and               To provide an overall        Desktop studies to collect available data from
 oceanographic (metocean).            understanding of the         hindcast or re-analysis models and field
                                      meteorological and           measurements in sufficient detail to support
                                      oceanographic conditions     design of your facility and support the
                                      at the site of your          analysis of wake effects, sediment mobility
                                      proposed facility, and to    and scour, and navigation risks.
                                      identify conditions that
                                      may pose a significant
                                      risk to your facility.
----------------------------------------------------------------------------------------------------------------

Sec.  585.611   What information and certifications must I submit with 
my SAP to assist BOEM in complying with NEPA and other applicable laws?

    (a) Your SAP must contain detailed information and analysis to 
assist BOEM in complying with NEPA and other applicable laws.
    (b) When proposing site assessment activities in an area where BOEM 
has no previous experience, your SAP must contain information about 
resources, conditions, and activities listed in the following table 
that your proposed activities may significantly affect or that may have 
a significant effect on your proposed activities (including where the 
potential significance of the effect is unknown) and must contain any 
other information required by law.

------------------------------------------------------------------------
     Type of information:                      Including:
------------------------------------------------------------------------
(1) Hazard information.......  Meteorology, oceanography, sediment
                                transport, geology, and shallow
                                geological or manmade hazards.
(2) Water quality............  Turbidity and total suspended solids from
                                construction; impact from vessel
                                discharges.
(3) Biological resources.....  Characterization of the spatial and
                                temporal distribution and abundance of
                                biological species in the site area,
                                such as benthic communities, marine
                                mammals, sea turtles, coastal and marine
                                birds, fish and shellfish, plankton, sea
                                grasses, and other plant life.
(4) Threatened or endangered   As needed for ESA consultation.
 species.
(5) Sensitive biological       Essential fish habitat, refuges,
 resources or habitats.         preserves, special management areas
                                identified in coastal management
                                programs, nearby marine protected areas,
                                including State and Federal coastal and
                                marine protected areas, as well as
                                nearby national marine sanctuaries, and
                                nearby marine national monuments,
                                rookeries, hard bottom habitat,
                                chemosynthetic communities, calving
                                grounds, barrier islands, beaches,
                                dunes, and wetlands.
(6) Archaeological resources   Required information to conduct review of
 use, other historic property   the COP under the NHPA or other
 use, Indigenous traditional    applicable laws or policies, including
 cultural use, or use           treaty and reserved rights with Native
 pertaining to treaty and       Americans or other Indigenous peoples.
 reserved rights with Native
 Americans or other
 Indigenous peoples.
(7) Social and economic        Employment, existing offshore and coastal
 conditions.                    infrastructure (including major sources
                                of supplies, services, energy, and
                                water), land use, subsistence resources
                                and harvest practices, recreation,
                                recreational and commercial fishing
                                (including typical fishing seasons,
                                location, and type), minority and lower
                                income groups, coastal zone management
                                programs, and a visual impact
                                assessment.
(8) Coastal and marine uses..  Military activities, vessel traffic,
                                fisheries, and exploration and
                                development of other natural resources.
                                This includes a navigational safety risk
                                assessment that provides a description
                                of the predicted impacts of the project
                                to navigation, and the measures you will
                                use to avoid or minimize adverse
                                impacts. This document must also be
                                submitted to the U.S. Coast Guard to
                                assist with its analysis if your
                                proposal identifies potential
                                impediments to safe navigation.

[[Page 42752]]

 
(9) Consistency Certification  If required by CZMA, under:
                               (i) 15 CFR part 930, subpart D, if the
                                SAP is submitted before lease issuance;
                               (ii) 15 CFR part 930, subpart E, if the
                                SAP is submitted after lease issuance.
(10) Other resources,          As identified by BOEM.
 conditions, and activities.
------------------------------------------------------------------------

    (c) When proposing site assessment activities in an area BOEM 
previously considered, BOEM will review your SAP to determine if its 
impacts are consistent with those previously considered. If the 
anticipated effects of your proposed SAP activities are significantly 
different than those previously anticipated, we may determine that 
additional NEPA and other relevant Federal reviews are required. In 
that case, BOEM will notify you of such determination, and you must 
submit information required in paragraph (b) of this section as 
appropriate.


Sec.  585.612  How will my SAP be processed for Federal consistency 
under the Coastal Zone Management Act?

    Your SAP will be processed based on whether it is submitted before 
or after your lease is issued:

------------------------------------------------------------------------
                                 Consistency review of your SAP will be
  If your SAP is submitted:               handled as follows:
------------------------------------------------------------------------
(a) Before lease issuance....  You will furnish a copy of your SAP,
                                consistency certification, and necessary
                                data and information to conduct an
                                adequate consistency review to the
                                applicable State CZMA agency or agencies
                                if required by 15 CFR part 930, subpart
                                D. and submit a copy to BOEM in
                                accordance with Sec.   585.111.
(b) After lease issuance.....  You must submit a copy of your SAP,
                                consistency certification, and necessary
                                data and information pursuant to 15 CFR
                                part 930, subpart E, to BOEM only if
                                BOEM did not consider the proposed site
                                assessment activities for your lease
                                area under its previously submitted
                                consistency determination under 15 CFR
                                part 930, subpart C, and if required by
                                15 CFR part 930, subpart E. BOEM will
                                forward to the applicable State CZMA
                                agency or agencies one copy of your SAP,
                                consistency certification, and necessary
                                data and information required to conduct
                                an adequate consistency review under 15
                                CFR part 930, subpart E, after BOEM has
                                determined that all information
                                requirements for the SAP are met.
------------------------------------------------------------------------

Sec.  585.613  How will BOEM process my SAP?

    (a) BOEM will review your submitted SAP, and additional information 
provided pursuant to Sec.  585.611, to determine if it contains the 
information necessary to conduct our technical and environmental 
reviews.
    (1) We will notify you if we deem your proposed facility or 
combination of facilities to be complex or significant; and
    (2) We will notify you if your submitted SAP lacks any necessary 
information.
    (b) BOEM will prepare a NEPA analysis, as appropriate.
    (c) As appropriate, we will coordinate and consult with relevant 
Federal and State agencies, affected federally recognized Indian Tribes 
and executives of relevant local governments and will provide to other 
Federal, State, and local agencies and affected federally recognized 
Indian Tribes relevant nonproprietary data and information pertaining 
to your proposed activities.
    (d) During the review process, we may request additional 
information if we determine that the information provided is not 
sufficient to complete the review and approval process. If you fail to 
provide the requested information, BOEM may disapprove your SAP.
    (e) Upon completion of our technical and environmental reviews and 
other reviews required by Federal laws (e.g., CZMA), BOEM will approve, 
disapprove, or approve with conditions your SAP.
    (1) If we approve your SAP, we will specify terms and conditions to 
be incorporated into your SAP. You must certify compliance with those 
terms and conditions, required under 30 CFR 285.615(b); and
    (2) If we disapprove your SAP, we will inform you of the reasons 
and allow you an opportunity to submit a revised plan addressing our 
concerns, and we may suspend your lease, as appropriate, to give you a 
reasonable amount of time to resubmit the SAP.

Activities Under an Approved SAP


Sec.  585.614  When may I begin conducting activities under my approved 
SAP?

    (a) You may begin conducting the activities approved in your SAP 
following BOEM approval of your SAP.
    (b) If you are installing a facility or a combination of facilities 
deemed by BOEM to be complex or significant, as provided in Sec.  
585.613(a)(1), you must comply with the requirements of 30 CFR part 
285, subpart G, and also submit your Safety Management System 
description required by 30 CFR 285.810 before construction may begin.


Sec.  585.615  What other reports or notices must I submit to BOEM 
under my approved SAP?

    You must prepare and submit to BOEM a report annually on November 
1st of each year that summarizes your site assessment activities and 
the results of those activities. BOEM will withhold trade secrets and 
commercial or financial information that is privileged or confidential 
from public disclosure under exemption 4 of the FOIA and as provided in 
Sec.  585.114.


Sec.  585.616  [Reserved]


Sec.  585.617  What activities require a revision to my SAP, and when 
will BOEM approve the revision?

    (a) You must notify BOEM in writing before conducting site 
assessment activities not described in your approved SAP involving 
facilities that are installed on the seabed using a fixed-bottom 
foundation requiring professional engineering design and assessment of 
sediment, meteorological, and oceanographic conditions as part of the 
design. Your notice must describe in detail the type of activities you 
propose to conduct. We will determine whether the activities you 
propose require a revision to your SAP. We may request additional 
information from you, if necessary, to make this determination.
    (b) If a revised SAP is required, BOEM will reassess, upon its 
receipt, whether the facility or combination of facilities described in 
it is complex or significant.
    (1) If BOEM determines that the facilities described in your 
revised SAP are not complex or significant, you may conduct your 
approved activities under Sec.  585.614(a).
    (2) If BOEM determines that the facilities described in your 
revised SAP

[[Page 42753]]

are complex or significant, you must comply with Sec.  585.614(b).
    (c) BOEM will periodically review the activities conducted under an 
approved SAP. The frequency and extent of the review will be based on 
the significance of any changes in available information and on onshore 
or offshore conditions affecting or affected by the activities 
conducted under your SAP. If the review indicates that the SAP should 
be revised to meet the requirements of this part, BOEM will require you 
to submit the needed revisions.
    (d) Activities for which a proposed revision to your SAP likely 
will be necessary include:
    (1) Activities on the OCS not described in your approved SAP that 
could have significant environmental impacts or that may affect 
threatened or endangered species, or that may affect designated 
critical habitat of such species, or that may result in incidental take 
of marine mammals;
    (2) Modifications to the number, size, or type of facilities 
(including associated components) or equipment you will use outside of 
the PDE that was approved for your project;
    (3) Changes in the geographical location or layout of your bottom 
disturbances, offshore facilities, or onshore support bases beyond the 
range of possible locations described in your approved SAP;
    (4) Structural failure of any facility operated under your approved 
SAP; or
    (5) Changes to any other activity specified by BOEM.
    (e) We may begin the appropriate NEPA analysis and other relevant 
consultations when we determine that a proposed revision could:
    (1) Result in a significant change in the impacts previously 
identified and evaluated;
    (2) Require any additional Federal authorizations; or
    (3) Involve activities not previously identified and evaluated.
    (f) When you propose a revision, we may approve the revision if we 
determine that the revision is:
    (1) Designed not to cause undue harm or damage to natural 
resources; life (including human and wildlife); property; the marine, 
coastal, or human environment; or sites, structures, or objects of 
historical or archaeological significance; and
    (2) Otherwise, consistent with the provisions of section 8(p) of 
the OCS Lands Act.


Sec.  585.618  What must I do upon completion of approved site 
assessment activities?

    (a) If your COP or FERC license application describes the continued 
use of existing facilities approved in your SAP, you may keep such 
facilities in place on your lease during the time that BOEM reviews 
your COP or FERC reviews your license application.
    (b) You are not required to initiate the decommissioning process 
for facilities that are authorized to remain in place under your 
approved COP or approved FERC license.
    (c) If, following the technical and environmental review of your 
submitted COP, BOEM determines that such facilities may not remain in 
place, you must initiate the decommissioning process, as provided in 30 
CFR part 285, subpart I.
    (d) If FERC determines that such facilities may not remain in 
place, you must initiate the decommissioning process as provided in 30 
CFR part 285, subpart I.
    (e) You must decommission your site assessment facilities as set 
forth in 30 CFR part 285, subpart I, upon the termination of your 
lease. You must submit your decommissioning application as required in 
30 CFR 285.905 and 285.906.


Sec.  585.619  [Reserved]

Construction and Operations Plan for Commercial Leases


Sec.  585.620  What is a Construction and Operations Plan (COP)?

    The COP describes your construction, operations, and conceptual 
decommissioning plans under your commercial lease, including your 
project easement. BOEM will withhold trade secrets and commercial or 
financial information that is privileged or confidential from public 
disclosure under exemption 4 of the FOIA and in accordance with the 
terms of Sec.  585.114.
    (a) Your COP must describe all planned facilities that you will 
construct and use for your project, including onshore and support 
facilities and all anticipated project easements.
    (b) Your COP must describe all proposed activities including your 
proposed construction activities, commercial operations, and conceptual 
decommissioning plans for all planned facilities, including onshore and 
support facilities.
    (c) You must receive BOEM approval of your COP before you can begin 
any of the approved activities on your lease.


Sec.  585.621  What must I demonstrate in my COP?

    Your COP must demonstrate that you have planned and are prepared to 
conduct the proposed activities in a manner that:
    (a) Conforms to your responsibilities listed in Sec.  585.105(a);
    (b) Conforms to all applicable laws, regulations, and provisions of 
your commercial lease;
    (c) Is safe;
    (d) Does not unreasonably interfere with other uses of the OCS, 
including those involved with national security or defense;
    (e) Does not cause undue harm or damage to natural resources; life 
(including human and wildlife); property; the marine, coastal, or human 
environment; or sites, structures, or objects of historical or 
archaeological significance;
    (f) Uses best available and safest technology;
    (g) Uses best management practices; and
    (h) Uses properly trained personnel.


Sec.  585.622  How do I submit my COP?

    (a) You must submit your COP to BOEM pursuant to Sec.  585.111.
    (b) You may submit information and a request for any project 
easement as part of your original COP submission or as a revision to 
your COP.


Sec. Sec.  585.623-585.625  [Reserved]

Contents of the Construction and Operations Plan


Sec.  585.626  What must I include in my COP?

    (a) Project information may be provided using a PDE. When you 
provide information using a PDE, BOEM reserves the right to determine 
what range of values for any given parameter is acceptable. Your COP 
must include the following project-specific information, as applicable:

------------------------------------------------------------------------
       Project information:                      Including:
------------------------------------------------------------------------
(1) Contact information...........  The name, address, email address,
                                     and phone number of an authorized
                                     representative.
(2) Designation of operator, if     As provided in Sec.   585.405.
 applicable.
(3) Commercial lease stipulations   A description of the measures you
 and compliance.                     took, or will take, to satisfy the
                                     conditions of any lease
                                     stipulations related to your
                                     proposed activities.

[[Page 42754]]

 
(4) A location plat, or indicative  The range of surface locations and
 layout.                             associated water depths for
                                     proposed structures, facilities,
                                     and appurtenances located both
                                     offshore and onshore, including all
                                     anchor and mooring data, and the
                                     location and associated water
                                     depths of all existing structures.
(5) General structural and project  Preliminary design information for
 design, fabrication, and            each facility associated with your
 installation.                       project including information
                                     needed to justify any request for
                                     an operations period exceeding the
                                     length provided in this part or the
                                     lease.
(6) Deployment activities.........  A description of safety, prevention,
                                     and environmental protection
                                     features or measures that you will
                                     use.
(7) A list of solid and liquid      Disposal methods and locations.
 wastes generated.
(8) A listing of chemical products  A list of chemical products used;
 used (if stored volume exceeds      the volume stored on location;
 Environmental Protection Agency     their treatment, discharge, or
 (EPA) reportable quantities).       disposal methods used; and the name
                                     and location of the onshore waste
                                     receiving, treatment, and/or
                                     disposal facility. A description of
                                     how these products would be brought
                                     onsite, the number of transfers
                                     that may take place, and the
                                     quantity that will be transferred
                                     each time.
(9) A description of any vessels,   An estimate of the frequency and
 vehicles, and aircraft you will     duration of vessel, vehicle, or
 use to support your activities.     aircraft traffic.
(10) A general description of the   (i) Under normal conditions.
 operating procedures and systems.  (ii) In the case of accidents or
                                     emergencies, including those that
                                     are natural or manmade.
(11) Decommissioning and site       A discussion of general concepts and
 clearance procedures.               methodologies.
(12) A listing of all Federal,      A statement indicating whether you
 State, and local authorizations     have applied for or obtained such
 or approvals required to conduct    authorization or approval from the
 the proposed activities,            U.S. Coast Guard, U.S. Army Corps
 including commercial operations.    of Engineers, and any other
                                     applicable Federal, State, or local
                                     authorizers pertaining to energy
                                     gathering, transmission, or
                                     distribution (e.g., interconnection
                                     authorizations).
(13) Your proposed measures for     A description of the measures you
 avoiding, minimizing, reducing,     will use to avoid or minimize
 eliminating, and monitoring         adverse effects and any potential
 environmental impacts.              incidental take before you conduct
                                     activities on your lease, and how
                                     you will mitigate environmental
                                     impacts from your proposed
                                     activities, including a description
                                     of the measures you will use as
                                     required by Sec.  Sec.   585.700
                                     through 585.703.
(14) Information you incorporate    A list of the documents you have
 by reference.                       incorporated by reference and their
                                     public availability.
(15) A list of agencies and         Contact information and issues
 persons with whom you have          discussed.
 communicated, or with whom you
 will communicate, regarding
 potential impacts associated with
 your proposed activities.
(16) References...................  A bibliographic list of any document
                                     or published source that you cite
                                     as part of your plan. You may
                                     reference information and data
                                     discussed in other plans you
                                     previously submitted or that are
                                     otherwise readily available to
                                     BOEM.
(17) Financial assurance..........  Statements attesting that the
                                     activities and facilities proposed
                                     in your COP are or will be covered
                                     by an appropriate bond or other
                                     approved financial assurance
                                     instrument as required in Sec.
                                     585.516 and Sec.  Sec.   585.525
                                     through 585.529.
(18) Project verification strategy  You must describe your strategy for
                                     compliance with 30 CFR285.705
                                     through 285.714.
(19) Construction schedule........  A reasonable schedule of
                                     construction activity showing
                                     significant milestones, including
                                     the commencement of commercial
                                     operations consistent with the
                                     requirements of 30 CFR part 285,
                                     subpart G.
(20) Air quality information......  Information as described in Sec.
                                     585.700.
(21) Other information............  Additional information as required
                                     by BOEM.
------------------------------------------------------------------------

    (b) You must include reports that document the results of surveys 
and investigations that characterize and model the site of your 
proposed project. Your reports must address the following topics:

----------------------------------------------------------------------------------------------------------------
               Topic:                     Purpose of report:                        Including:
----------------------------------------------------------------------------------------------------------------
(1) Geological and geotechnical....  To define the baseline       (i) Desktop studies to collect available data
                                      geological conditions of     from published sources and nearby sites.
                                      the seabed and provide      (ii) Geophysical surveys of the proposed area
                                      sufficient data to develop   with sufficient areal coverage, depth
                                      a geologic model, assess     penetration, and resolution to define the
                                      geologic hazards, and        geological conditions of the site's seabed
                                      determine the feasibility    that could impact, or be impacted by, the
                                      of the proposed site for     proposed project.
                                      your proposed facility.     (iii) Geotechnical investigations of
                                                                   sufficient scope and detail to: ground truth
                                                                   the geophysical surveys; support development
                                                                   of a geological model; assess potential
                                                                   geological hazards that could impact the
                                                                   proposed project; and provide geotechnical
                                                                   data for preliminary design of the facility,
                                                                   including type and approximate dimensions of
                                                                   the foundation.
                                                                  (iv) An overall site characterization report
                                                                   for your facility that integrates the
                                                                   findings of your studies, surveys, and
                                                                   investigations; describes the geological
                                                                   model; contains supporting data and findings;
                                                                   and states your recommendations.

[[Page 42755]]

 
(2) Biological.....................  To determine the presence    A description of the results of biological
                                      of biological features and   surveys used to determine the presence of
                                      marine resources..           live bottoms, hard bottoms, topographic
                                                                   features, and other marine resources,
                                                                   including migratory populations such as fish,
                                                                   marine mammals, sea turtles, and sea birds.
(3) Archaeological resources and     To provide BOEM with         Archaeological resources and other historic
 other historic properties.           required information to      properties.
                                      conduct review of the COP
                                      under NHPA.
(4) Meteorological and               To provide an overall        Desktop studies to collect available data from
 oceanographic (metocean).            understanding of the         hindcast or re-analysis models and field
                                      meteorological and           measurements in sufficient detail to support
                                      oceanographic conditions     preliminary design of the facility and
                                      at the site of the           support the analysis of wake effects,
                                      proposed facility, and to    sediment mobility and scour, and navigational
                                      identify conditions that     risks
                                      may pose a significant
                                      risk to the facility.
----------------------------------------------------------------------------------------------------------------

Sec.  585.627  What information and certifications must I submit with 
my COP to assist BOEM in complying with NEPA and other applicable laws?

    (a) Your COP must contain detailed information and analysis to 
assist BOEM in complying with NEPA and other applicable laws. Your COP 
must contain information about those resources, conditions, and 
activities listed in the following table that your proposed activities 
may significantly affect, or that may have a significant effect on your 
proposed activities (including where the potential significance of the 
effect is unknown) and must contain any other information required by 
law:

------------------------------------------------------------------------
     Type of information:                      Including:
------------------------------------------------------------------------
(1) Hazard information.......  Meteorology, oceanography, sediment
                                transport, geology, and shallow
                                geological or manmade hazards.
(2) Water quality............  Turbidity and total suspended solids from
                                construction; impact from vessel
                                discharges.
(3) Biological resources.....  Benthic communities, marine mammals, sea
                                turtles, coastal and marine birds, fish
                                and shellfish, plankton, seagrasses, and
                                plant life.
(4) Threatened or endangered   As required by ESA.
 species.
(5) Sensitive biological       Essential fish habitat, refuges,
 resources or habitats.         preserves, special management areas
                                identified in coastal management
                                programs, nearby marine protected areas,
                                including State and Federal coastal and
                                nearby marine protected areas, as well
                                as national marine sanctuaries and
                                nearby marine national monuments,
                                rookeries, hard bottom habitat,
                                chemosynthetic communities, calving
                                grounds, barrier islands, beaches,
                                dunes, and wetlands.
(6) Archaeological resources   Required information to conduct review of
 use, other historic property   the COP under the NHPA or other
 use, Indigenous traditional    applicable laws or policies, including
 cultural use, or use           treaty and reserved rights with Native
 pertaining to treaty and       Americans or other Indigenous peoples.
 reserved rights with Native
 Americans or other
 Indigenous peoples.
(7) Social and economic        Employment, existing offshore and coastal
 resources.                     infrastructure (including major sources
                                of supplies, services, energy, and
                                water), land use, subsistence resources
                                and harvest practices, recreation,
                                recreational and commercial fishing
                                (including typical fishing seasons,
                                location, and type), minority and lower
                                income groups, coastal zone management
                                programs, and a visual impact
                                assessment.
(8) Coastal and marine uses..  Military activities, vessel traffic,
                                fisheries, and exploration and
                                development of other natural resources.
                                This includes a navigational safety risk
                                assessment that provides a description
                                of the predicted impacts of the project
                                to navigation and the measures you will
                                use to avoid or minimize such adverse
                                impacts. This document also must be
                                submitted to the U.S. Coast Guard to
                                assist with its analysis.
(9) Consistency Certification  If required by CZMA regulations:
                               (i) 15 CFR part 930, subpart D, if your
                                COP is submitted before lease issuance.
                               (ii) 15 CFR part 930, subpart E, if your
                                COP is submitted after lease issuance.
(10) Other resources,          As identified by BOEM.
 conditions, and activities.
------------------------------------------------------------------------

    (b) You must submit one copy of your consistency certification. 
Your consistency certification must include:
    (1) One copy of your consistency certification either under 
subsection 307(c)(3)(B) of the CZMA (16 U.S.C. 1456(c)(3)(B)) and 15 
CFR 930.76, or under subsection 307(c)(3)(A) of the CZMA (16 U.S.C. 
1456(c)(3)(A)) and 15 CFR 930.57, stating that the proposed activities 
described in detail in your plans comply with the enforceable policies 
of the applicable States' approved coastal management programs and will 
be conducted in a manner that is consistent with such programs; and
    (2) ``Necessary data and information,'' as required by 15 CFR 
930.58.
    (c) You must submit a detailed description of an oil spill response 
plan to BSEE in compliance with 33 U.S.C. 1321, including information 
identified in 30 CFR part 254 that is applicable to your activities.
    (d) You must submit a detailed description of your safety 
management system to BSEE as required by 30 CFR 285.810.


Sec.  585.628  How will BOEM process my COP?

    (a) BOEM will review your submitted COP, including the information 
provided under Sec.  585.627, to determine if it contains the 
information necessary to conduct our technical and environmental 
reviews. We will notify you if your submitted COP lacks any necessary 
information.
    (b) BOEM will prepare an appropriate NEPA analysis.
    (c) If your COP is subject to Federal consistency review under CZMA

[[Page 42756]]

regulations at 15 CFR part 930, subpart E, you must submit your COP, 
consistency certification, and associated data and information under 
CZMA to BOEM after all information requirements for the COP are met, 
and the appropriate environmental assessment or draft environmental 
impact statement, if required, has been published. BOEM will forward 
the COP, consistency certification, and associated data and information 
to the applicable State CZMA agencies.
    (d) As appropriate, BOEM will coordinate and consult with relevant 
Federal, State, and local agencies and affected federally recognized 
Indian Tribes, and provide to them relevant nonproprietary data and 
information pertaining to your proposed activities.
    (e) During the review process, we may request additional 
information if we determine that the information provided is not 
sufficient to complete the review and approval process. If you fail to 
provide the requested information, BOEM may disapprove your COP.
    (f) Upon completion of our technical and environmental reviews and 
other reviews required by Federal law (e.g., CZMA), BOEM will approve, 
disapprove, or approve your COP with conditions.
    (1) If we approve your COP, we will specify terms and conditions to 
be incorporated into your COP. You must certify compliance with certain 
of those terms and conditions, as required under 30 CFR 285.633(a); and
    (2) If we disapprove your COP, we will inform you of the reasons 
and allow you an opportunity to submit a revised plan addressing our 
concerns, and we may suspend the COP review period of your lease, as 
appropriate, to give you a reasonable amount of time to submit the 
revised plan.
    (g) If BOEM approves your project easement, BOEM will issue an 
addendum to your lease specifying the terms of the project easement.
    (1) The project easement will provide sufficient off-lease area to 
accommodate potential changes at the design and installation phases 
with respect to any facilities or activities necessary for your 
project.
    (2) Unused portions of the project easement may be relinquished 
after construction is complete.
    (3) A project easement is subject to the following conditions:
    (i) The rights granted will not prevent the granting of other 
rights by the United States, either before or after the granting of the 
project easement, provided that any subsequent authorization issued by 
BOEM in the area of a previously issued project easement may not 
unreasonably interfere with activities approved or impede existing 
operations under the project easement; and
    (ii) If the project easement is granted in an area where a lease, 
ROW or RUE grant has previously been issued, the project easement 
holder must agree that its activities will not unreasonably interfere 
with or impede existing operations under the lease or ROW or RUE grant.


Sec. Sec.  585.629-585.630  [Reserved]

Activities Under an Approved COP


Sec.  585.631  When must I initiate activities under an approved COP?

    After your COP is approved, you are expected to commence 
construction on the OCS in accordance with the construction schedule 
included as a part of your approved COP, unless you notify BOEM in 
advance of a deviation from your schedule.


Sec.  585.632  What documents must I submit before I may construct and 
install facilities under my approved COP?

    (a) You must submit to BSEE the documents listed in the following 
table:

------------------------------------------------------------------------
                 Document:                   Requirements are found in:
------------------------------------------------------------------------
(1) Facility Design Report................  30 CFR 285.701.
(2) Fabrication and Installation Report...  30 CFR 285.702.
------------------------------------------------------------------------

    (b) You must submit your Safety Management System, as required by 
30 CFR 285.810.
    (c) These activities must fall within the scope of your approved 
COP. If they do not fall within the scope of your approved COP, you 
will be required to submit a revision to your COP, under Sec.  585.634, 
for BOEM approval before commencing the activity.


Sec.  585.633  [Reserved]


Sec.  585.634  What activities require a revision to my COP, and when 
will BOEM approve the revision?

    (a) You must notify BOEM in writing before conducting any 
activities on the OCS not described in your approved COP. Your notice 
must describe in detail the type of activities you propose to conduct. 
We will determine whether the activities you propose require a revision 
to your COP. We may request additional information from you, if 
necessary, to make this determination.
    (b) BOEM will periodically review the activities conducted under an 
approved COP. The frequency and extent of the review will be based on 
the significance of any changes in available information, and on 
onshore or offshore conditions affecting, or affected by, the 
activities conducted under your COP. If the review indicates that the 
COP should be revised to meet the requirement of this part, BOEM will 
require you to submit the needed revisions.
    (c) Activities for which a proposed revision to your COP likely 
will be necessary include:
    (1) Activities on the OCS not described in your approved COP that 
could have significant environmental impacts, that may affect 
threatened or endangered species, or affect designated critical habitat 
of such species, or that may result in incidental take of marine 
mammals;
    (2) Modifications to the number, size, or type of facilities 
(including associated components) or equipment you will use outside of 
the PDE that was approved for your project;
    (3) Material changes in the geographical location or layout of 
bottom disturbances, offshore facilities, or onshore support bases 
beyond the range of possible locations described in your approved COP;
    (4) Structural failure of any facility operated under your approved 
COP;
    (5) Submission of an FDR or FIR that contains new activities beyond 
the scope of or that is materially inconsistent with the COP that has 
been previously submitted; or
    (6) Change in any other activity specified by BOEM.
    (d) We may begin the appropriate NEPA analysis and relevant 
consultations when we determine that a proposed revision could:
    (1) Result in a significant change in the impacts previously 
identified and evaluated;
    (2) Require any additional Federal authorizations; or
    (3) Involve activities not previously identified and evaluated that 
could have significant environmental impacts, that may affect 
threatened or endangered species, or designated critical habitat of 
such species, or that may result in incidental take of marine mammals.
    (e) When you propose a revision, we may approve the revision if we 
determine that the revision is:
    (1) Designed not to cause undue harm or damage to natural 
resources; life (including human and wildlife); property; the marine, 
coastal, or human environment; or sites, structures, or objects of 
historical or archaeological significance; and
    (2) Otherwise consistent with the provisions of subsection 8(p) of 
the OCS Lands Act.

[[Page 42757]]

Sec.  585.635  What must I do if I cease activities approved in my COP 
before the end of my commercial lease?

    You must notify BSEE, within 5 business days, any time you cease 
commercial operations, without an approved suspension, under your 
approved COP. If you cease commercial operations for an indefinite 
period, which extends longer than 6 months, we may cancel your lease 
under Sec.  585.422 and you must initiate the decommissioning process 
as set forth in 30 CFR part 285, subpart I.


Sec. Sec.  585.636-585.639  [Reserved]

General Activities Plan Requirements for Limited Leases, ROW Grants, 
and RUE Grants


Sec.  585.640  What is a General Activities Plan (GAP)?

    (a) A GAP describes your proposed construction, activities, and 
conceptual decommissioning plans for all planned facilities, including 
testing of technology devices and onshore and support facilities that 
you will construct and use for your project, including any project 
easements for the assessment and development of your limited lease or 
grant.
    (b) You must receive BOEM approval of your GAP before you can begin 
any of the proposed activities on your lease or grant.


Sec.  585.641  What must I demonstrate in my GAP?

    Your GAP must demonstrate that you have planned and are prepared to 
conduct the proposed activities in a manner that:
    (a) Conforms to your responsibilities listed in Sec.  585.105(a);
    (b) Conforms to all applicable laws, regulations, and provisions of 
your limited lease or grant;
    (c) Is safe;
    (d) Does not unreasonably interfere with other uses of the OCS, 
including those involved with national security or defense;
    (e) Does not cause undue harm or damage to natural resources; life 
(including human and wildlife); property; the marine, coastal, or human 
environment; or sites, structures, or objects of historical or 
archaeological significance;
    (f) Uses best available and safest technology;
    (g) Uses best management practices; and
    (h) Uses properly trained personnel.


Sec.  585.642  How do I submit my GAP?

    (a) You must submit your GAP to BOEM pursuant to Sec.  585.111.
    (b) If you have a limited lease, you may submit information on any 
project easement as part of your original GAP submission or as a 
revision to your GAP.


Sec. Sec.  585.643-585.644  [Reserved]

Contents of the General Activities Plan


Sec.  585.645  What must I include in my GAP?

    (a) Project information may be provided using a PDE. When you 
provide a range of parameters using a PDE, BOEM reserves the right to 
determine what range of values for any given parameter is acceptable. 
Your GAP must include the following project-specific information, as 
applicable:

------------------------------------------------------------------------
     Project information:                      Including:
------------------------------------------------------------------------
(1) Contact information......  The name, address, email address, and
                                phone number of an authorized
                                representative.
(2) Designation of operator,   As provided in Sec.   585.405.
 if applicable.
(3) Your proposed              A discussion of the objectives;
 construction, activities,      description of the proposed activities,
 and conceptual                 including the technology you will use;
 decommissioning plans, and/    and proposed schedule from start to
 or technology testing          completion.
 concept.
(4) ROW or RUE grant, or       A description of the measures you took,
 limited lease stipulations,    or will take, to satisfy the conditions
 if known.                      of any grant or lease stipulations
                                related to your proposed activities.
(5) A location plat, or        The range of surface locations and
 indicative layout.             associated water depths for proposed
                                structures, facilities, and
                                appurtenances located both offshore and
                                onshore, including all anchor and
                                mooring data; and the location and
                                associated water depths of all existing
                                structures.
(6) General structural and     Preliminary design information for each
 project design, fabrication,   facility associated with your project.
 and installation.
(7) Deployment activities....  A description of the safety, prevention,
                                and environmental protection features or
                                measures that you will use.
(8) Your proposed measures     A description of the measures you will
 for avoiding, minimizing,      use to avoid or minimize adverse effects
 reducing, eliminating, and     and any potential incidental take before
 monitoring environmental       you conduct activities on your lease,
 impacts.                       and how you will mitigate environmental
                                impacts from your proposed activities,
                                including a description of the measures
                                you will use as required by Sec.  Sec.
                                585.701 through 585.703.
(9) A list of solid and        Disposal methods and locations.
 liquid wastes generated.
(10) A listing of chemical     A list of chemical products used; the
 products used (if stored       volume stored on location; their
 volume exceeds EPA             treatment, discharge, or disposal
 reportable quantities).        methods used; and the name and location
                                of the onshore waste receiving,
                                treatment, and/or disposal facility. A
                                description of how these products would
                                be brought onsite, the number of
                                transfers that may take place, and the
                                quantity that will be transferred each
                                time.
(11) A description of any      An estimate of the frequency and duration
 vessels, vehicles, and         of vessel, vehicle, and aircraft
 aircraft you will use to       traffic.
 support your activities.
(12) Reference information...  A bibliographic list of any document or
                                published source that you cite as part
                                of your plan. You may reference
                                information and data discussed in other
                                plans you previously submitted or that
                                are otherwise readily available to BOEM.
(13) Decommissioning and site  A discussion of general concepts and
 clearance procedures.          methodologies.
(14) Air quality information.  As described in Sec.   585.700.
(15) A listing of all          A statement indicating whether you have
 Federal, State, and local      applied for or obtained such
 authorizations or approvals    authorization or approval from the U.S.
 required to conduct            Coast Guard, U.S. Army Corps of
 activities on your grant or    Engineers, and any other applicable
 limited lease.                 Federal, State, or local authorizers
                                pertaining to your activities.
(16) A list of agencies and    Contact information and issues discussed.
 persons with whom you have
 communicated, or with whom
 you will communicate,
 regarding potential impacts
 associated with your
 proposed activities.

[[Page 42758]]

 
(17) Financial assurance       Statements attesting that the activities
 information.                   and facilities proposed in your GAP are,
                                or an explanation of how they will be,
                                covered by an appropriate bond or other
                                approved security, as required in Sec.
                                Sec.   585.520 and 585.521.
(18) Project verification      You must describe your strategy for
 strategy.                      compliance with 30 CFR 285.705 through
                                285.714.
(19) Information you           A list of the documents you have
 incorporate by reference.      incorporated by reference and where they
                                may be publicly accessed; for
                                confidential information, you may
                                reference information and data discussed
                                in other plans previously submitted or
                                that are otherwise readily available to
                                BOEM.
(20) Other information.......  Additional information as required by
                                BOEM.
------------------------------------------------------------------------

    (b) You must include reports that document the results of surveys 
and investigations that characterize and model the site of your 
proposed activities. Your reports must cover the following topics:

----------------------------------------------------------------------------------------------------------------
               Topic:                     Purpose of report:                        Including:
----------------------------------------------------------------------------------------------------------------
(1) Geological and geotechnical....  To define the baseline       (i) Desktop studies to collect available data
                                      geological conditions of     from published sources and nearby sites.
                                      the seabed and provide      (ii) Geophysical surveys of the proposed area
                                      sufficient data to develop   with sufficient areal coverage, depth
                                      a geologic model, assess     penetration, and resolution to define the
                                      geologic hazards, and        geological conditions of the seabed at the
                                      determine the feasibility    site that could impact, or be impacted by,
                                      of the proposed facility.    the proposed project.
                                                                  (iii) Geotechnical investigations of
                                                                   sufficient scope and detail to: ground truth
                                                                   the geophysical surveys; support development
                                                                   of a geological model; assess potential
                                                                   geological hazards that could impact the
                                                                   proposed development; and provide
                                                                   geotechnical data for preliminary design of
                                                                   the facility, including type and approximate
                                                                   dimensions of the foundation.
                                                                  (iv) An overall site characterization report
                                                                   for your facility that integrates the
                                                                   findings of your studies, surveys, and
                                                                   investigations; describes the geological
                                                                   model; contains supporting data and findings;
                                                                   and states your recommendations.
(2) Biological.....................  To determine the presence    A description of the results of biological
                                      of biological features and   surveys used to determine the presence of
                                      marine resources.            live bottoms, hard bottoms, topographic
                                                                   features, and other marine resources,
                                                                   including migratory populations, such as
                                                                   fish, marine mammals, sea turtles, and sea
                                                                   birds.
(3) Archaeological resources and     To provide BOEM with         Archaeological resource and other historic
 other historic properties.           required information to      property identification surveys with
                                      conduct review of the GAP    supporting data.
                                      under NHPA.
(4) Meteorological and               To provide an overall        Desktop studies to collect available data from
 oceanographic (metocean).            understanding of the         hindcast or re-analysis models and field
                                      meteorological and           measurements in sufficient detail to support
                                      oceanographic conditions     preliminary design of the facility and
                                      at the site of the           support the analysis of wake effects,
                                      proposed facility, and to    sediment mobility and scour, and navigation
                                      identify conditions that     risks.
                                      may pose a significant
                                      risk to the facility.
----------------------------------------------------------------------------------------------------------------

    (c) If you are applying for a project easement, or constructing a 
facility or a combination of facilities deemed by BOEM to be complex or 
significant, you must provide the following additional information and 
comply with the requirements of 30 CFR part 285, subpart G:

------------------------------------------------------------------------
     Project information:                      Including:
------------------------------------------------------------------------
(1) The construction and       A discussion of the objectives,
 operation concept.             description of the proposed activities,
                                and tentative schedule from start to
                                completion.
(2) All cables and pipelines,  The location, design, installation
 including cables on project    methods, testing, maintenance, repair,
 easements.                     safety devices, exterior corrosion
                                protection, inspections, and
                                decommissioning.
(3) A general description of   (i) Under normal conditions.
 the operating procedures and  (ii) In the case of accidents or
 systems.                       emergencies, including those that are
                                natural or manmade.
(4) Construction schedule....  A reasonable schedule of construction
                                activity showing significant milestones
                                including the commencement of activities
                                consistent with the requirements of 30
                                CFR part 285, subpart G.
(5) Other information........  Additional information as requested by
                                BOEM.
------------------------------------------------------------------------

    (d) BOEM will withhold trade secrets and commercial or financial 
information that is privileged or confidential from public disclosure 
in accordance with the terms of Sec.  585.114.


Sec.  585.646  What information and certifications must I submit with 
my GAP to assist BOEM in complying with NEPA and other applicable laws?

    You must submit, with your GAP, detailed information and analysis 
to assist BOEM in complying with NEPA and other applicable laws.
    (a) A GAP submitted for an area in which BOEM has not reviewed GAP 
activities under NEPA or other applicable Federal laws must describe 
those resources, conditions, and

[[Page 42759]]

activities listed in paragraphs (b)(1) through (10) of this section 
that your proposed activities may significantly affect or that may have 
a significant effect on your activities proposed in your GAP (including 
where the potential significance of the effect is unknown) and must 
contain any other information required by law.
    (b) For a GAP submitted for an area in which BOEM has considered 
GAP activities under applicable Federal law (e.g., a NEPA analysis and 
CZMA consistency determination for the GAP activities), BOEM will 
review the GAP to determine if its impacts are consistent with those 
previously considered. If the anticipated effects of your proposed GAP 
activities are significantly different than those previously 
anticipated, we may determine that additional NEPA and other relevant 
Federal reviews are required. In that case, BOEM will notify you of 
such determination, and you must submit a GAP that describes those 
resources, conditions, and activities listed in the following table 
that your proposed activities may significantly affect or that may have 
a significant effect on your activities proposed in your GAP (including 
where the potential significance of the effect is unknown) and must 
contain any other information required by law, including:

------------------------------------------------------------------------
     Type of information:                      Including:
------------------------------------------------------------------------
(1) Hazard information.......  Meteorology, oceanography, sediment
                                transport, geology, and shallow
                                geological or manmade hazards.
(2) Water quality............  Turbidity and total suspended solids from
                                construction; impact from vessel
                                discharges.
(3) Biological resources.....  Benthic communities, marine mammals, sea
                                turtles, coastal and marine birds, fish
                                and shellfish, plankton, sea grasses,
                                and other plant life.
(4) Threatened or endangered   As required by the ESA (16 U.S.C. 1531 et
 species.                       seq.).
(5) Sensitive biological       Essential fish habitat, refuges,
 resources or habitats.         preserves, special management areas
                                identified in coastal management
                                programs, marine protected areas,
                                including State and Federal coastal and
                                marine protected areas, as well as
                                nearby national marine sanctuaries and
                                nearby marine national monuments,
                                rookeries, hard bottom habitat,
                                chemosynthetic communities, calving
                                grounds, barrier islands, beaches,
                                dunes, and wetlands.
(6) Archaeological resources   Required information to conduct review of
 use, other historic property   the COP under the NHPA or other
 use, Indigenous traditional    applicable laws or policies, including
 cultural use, or use           treaty and reserved rights with Native
 pertaining to treaty and       Americans or other Indigenous peoples.
 reserved rights with Native
 Americans or other
 Indigenous peoples.
(7) Social and economic        Employment, existing offshore and coastal
 conditions.                    infrastructure (including major sources
                                of supplies, services, energy, and
                                water), land use, subsistence resources
                                and harvest practices, recreation,
                                recreational and commercial fishing
                                (including typical fishing seasons,
                                location, and type), minority and lower
                                income groups, coastal zone management
                                programs, and a visual impact
                                assessment.
(8) Coastal and marine uses..  Military activities, vessel traffic,
                                fisheries, and exploration and
                                development of other natural resources.
                                This includes a navigational safety risk
                                assessment that provides a description
                                of the predicted impacts of the project
                                to navigation, and the measures you will
                                use to avoid or minimize such adverse
                                impacts. This document also must be
                                submitted to the U.S. Coast Guard to
                                assist with its analysis if your
                                proposal identifies potential
                                impediments to safe navigation.
(9) Consistency Certification  If required by CZMA, under:
                               (i) 15 CFR part 930, subpart D, if the
                                GAP is submitted before lease or grant
                                issuance;
                               (ii) 15 CFR part 930, subpart E, if the
                                GAP is submitted after lease or grant
                                issuance.
(10) Other resources,          As required by BOEM.
 conditions, and activities.
------------------------------------------------------------------------

Sec.  585.647  How will my GAP be processed for Federal consistency 
under the Coastal Zone Management Act?

    Your GAP will be processed based on whether it is submitted before 
or after your lease or grant is issued:

------------------------------------------------------------------------
                                 Consistency review of your GAP will be
  If your GAP is  submitted:              handled as follows:
------------------------------------------------------------------------
(a) Before lease or grant      You will furnish a copy of your GAP,
 issuance.                      consistency certification, and necessary
                                data and information to conduct an
                                adequate consistency review to the
                                applicable State CZMA agencies if
                                required by 15 CFR part 930, subpart D.
                                Submit a copy to BOEM pursuant to Sec.
                                585.111.
(b) After lease or grant       You will submit a copy of your GAP,
 issuance.                      consistency certification, and necessary
                                data and information to BOEM if required
                                by 15 CFR part 930, subpart E. BOEM will
                                forward to the applicable State CZMA
                                agency or agencies one copy of your GAP,
                                consistency certification, and necessary
                                data and information to conduct an
                                adequate consistency review required
                                under 15 CFR part 930, subpart E, after
                                BOEM has determined that all information
                                requirements for the GAP are met.
------------------------------------------------------------------------

Sec.  585.648  How will BOEM process my GAP?

    (a) BOEM will review your submitted GAP, along with the information 
and certifications you submitted in compliance with Sec.  585.646, to 
determine if it contains the information necessary to conduct our 
technical and environmental reviews.
    (1) We will notify you if we deem your proposed facility or 
combination of

[[Page 42760]]

facilities to be complex or significant; and
    (2) We will notify you if your submitted GAP lacks any necessary 
information.
    (b) BOEM will prepare appropriate NEPA analysis.
    (c) When appropriate, we will coordinate and consult with relevant 
State and Federal agencies and affected federally recognized Indian 
Tribes and provide to other local, State, and Federal agencies and 
affected federally recognized Indian Tribes relevant nonproprietary 
data and information pertaining to your proposed activities.
    (d) During the review process, we may request additional 
information if we determine that the information provided is not 
sufficient to complete the review and approval process. If you fail to 
provide the requested information, BOEM may disapprove your GAP.
    (e) Upon completion of our technical and environmental reviews and 
other reviews required by Federal law (e.g., CZMA), BOEM may approve, 
disapprove, or approve your GAP with conditions.
    (1) If we approve your GAP, we will specify terms and conditions to 
be incorporated into your GAP. You must certify compliance with certain 
of those terms and conditions, as required under 30 CFR 285.653(b); and
    (2) If we disapprove your GAP, we will inform you of the reasons 
and allow you an opportunity to submit a revised plan addressing our 
concerns, and we may suspend your lease or grant, as appropriate, to 
give you a reasonable amount of time to resubmit the GAP.


Sec.  585.649  [Reserved]

Activities Under an Approved GAP


Sec.  585.650  When may I begin conducting activities under my GAP?

    After BOEM approves your GAP, you may begin conducting the approved 
activities that do not involve a project easement or the construction 
of facilities on the OCS that BOEM has deemed to be complex or 
significant.


Sec.  585.651  When may I construct complex or significant OCS 
facilities on my limited lease or any facilities on my project easement 
proposed under my GAP?

    If you are applying for a project easement or installing a facility 
or a combination of facilities on your limited lease deemed by BOEM to 
be complex or significant, as provided in Sec.  585.648(a)(1), you also 
must comply with the requirements of 30 CFR part 285, subpart G, and 
submit your safety management system description required by 30 CFR 
285.810 before construction may begin.


Sec.  585.652  How long do I have to conduct activities under an 
approved GAP?

    After BOEM approves your GAP, you have:
    (a) For a limited lease, the time period established under Sec.  
585.236(a)(2), unless we renew the operations period under Sec. Sec.  
585.425 through 585.429.
    (b) For a ROW grant or RUE grant, the time provided in the terms of 
the grant.


Sec.  585.653  What other reports or notices must I submit to BOEM 
under my approved GAP?

    You must prepare and submit to BOEM annually a report that 
summarizes the findings from any activities you conduct under your 
approved GAP and the results of those activities. BOEM will protect the 
information from public disclosure as provided in Sec.  585.114.


Sec.  585.654   [Reserved]


Sec.  585.655  What activities require a revision to my GAP, and when 
will BOEM approve the revision?

    (a) You must notify BOEM in writing before conducting any 
activities on the OCS not described in your approved GAP. Your notice 
must describe in detail the type of activities you propose to conduct. 
We will determine whether the activities you propose require a revision 
to your GAP. We may request additional information from you, if 
necessary, to make this determination. Upon receipt of your revised 
GAP, BOEM will make a determination as to whether it deems the facility 
or combination of facilities described in your revised GAP to be 
complex or significant.
    (1) If BOEM determines that your revised GAP is not complex or 
significant, you may conduct your approved activities in accordance 
with Sec.  585.650.
    (2) If BOEM determines that your revised GAP is complex or 
significant, then you must comply with the requirements of Sec.  
585.651.
    (b) BOEM will periodically review the activities conducted under an 
approved GAP. The frequency and extent of the review will be based on 
the significance of any changes in available information and on onshore 
or offshore conditions affecting, or affected by, the activities 
conducted under your GAP. If the review indicates that the GAP should 
be revised to meet the requirement of this part, BOEM will require you 
to submit the needed revisions.
    (c) Activities for which a proposed revision to your GAP likely 
will be necessary include:
    (1) Activities on the OCS not described in your approved GAP that 
could have significant environmental impacts or that may affect 
threatened or endangered species, or that may affect designated 
critical habitat of such species or that may result in incidental take 
of marine mammals;
    (2) Modifications to the number, size, or type of facilities 
(including associated components) or equipment you will use outside of 
the PDE that was approved for your project;
    (3) Changes in the geographical location or layout of bottom 
disturbances, offshore facilities, or onshore support bases beyond the 
range of possible locations described in your approved GAP;
    (4) Structural failure of any facility operated under your approved 
GAP; or
    (5) Change to any other activity specified by BOEM.
    (d) We may begin the appropriate NEPA analysis and any relevant 
consultations when we determine that a proposed revision could:
    (1) Result in a significant change in the impacts previously 
identified and evaluated;
    (2) Require any additional Federal authorizations; or
    (3) Involve activities not previously identified and evaluated that 
could have significant environmental impacts or that may affect 
threatened or endangered species, or that may affect designated 
critical habitat of such species, or that may result in incidental take 
of marine mammals.
    (e) When you propose a revision, we may approve the revision if we 
determine that the revision is:
    (1) Designed not to cause undue harm or damage to natural 
resources; life (including human and wildlife); property; the marine, 
coastal, or human environment; or sites, structures, or objects of 
historical or archaeological significance; and
    (2) Otherwise consistent with the provisions of subsection 8(p) of 
the OCS Lands Act.


Sec.  585.656  What must I do if I cease activities approved in my GAP 
before the end of my term?

    You must notify BOEM any time you cease activities under your 
approved GAP without an approved suspension. If you cease activities 
for an indefinite period that exceeds 6 months, BOEM may cancel your 
lease or grant under Sec.  585.422, as applicable, and you must 
initiate the decommissioning process, as set forth in 30 CFR part 285, 
subpart I.


Sec.  585.657  What must I do upon completion of approved activities 
under my GAP?

    Upon completion of your approved activities under your GAP, you 
must

[[Page 42761]]

decommission your project as set forth in 30 CFR part 285, subpart I. 
You must submit your decommissioning application as provided in 30 CFR 
285.905 and 285.906.

Cable and Pipeline Deviations


Sec.  585.658  Can my cable or pipeline construction deviate from my 
approved COP or GAP?

    (a) You must make every effort to ensure that all cables and 
pipelines are constructed in a manner that minimizes deviations from 
the approved plan under your lease or grant.
    (b) If BOEM determines that a significant change in conditions has 
occurred that would necessitate an adjustment to your ROW, RUE, or 
lease before the commencement of construction of the cable or pipeline 
on the grant or lease, BOEM will consider modifications to your ROW 
grant, RUE grant, or your lease addendum for a project easement in 
connection with your COP or GAP.
    (c) If, after construction, it is determined that a deviation from 
the approved plan has occurred, you must:
    (1) Notify the operators of all leases (including mineral leases 
issued under this subchapter) and holders of all ROW grants or RUE 
grants (including all grants issued under this subchapter) which 
include the area where a deviation has occurred and provide BOEM with 
evidence of such notification;
    (2) Relinquish any unused portion of your lease or grant; and
    (3) Submit a revised plan for BOEM approval as necessary.
    (d) Construction of a cable or pipeline that substantially deviates 
from the approved plan may be grounds for cancellation of the lease or 
grant.


Sec.  585.659-585.699  [Reserved]

Environmental Protection Requirements Under Approved Plans


Sec.  585.700  What requirements must I include in my SAP, COP, or GAP 
regarding air quality?

    (a) You must comply with the Clean Air Act (42 U.S.C. 7409) and its 
implementing regulations in 40 CFR part 55, according to the following 
table.

------------------------------------------------------------------------
    If your project is located . . .              You must . . .
------------------------------------------------------------------------
(1) In the Gulf of Mexico west of        Include in your plan any
 87.5[deg] west longitude (western Gulf   information required for BOEM
 of Mexico) or offshore of the North      to make the appropriate air
 Slope Borough of Alaska.                 quality determinations for
                                          your project.
(2) Anywhere else on the OCS...........  Follow the appropriate
                                          implementing regulations as
                                          promulgated by the EPA under
                                          40 CFR part 55.
------------------------------------------------------------------------

    (b) For air quality modeling that you perform in support of the 
activities proposed in your plan, you should contact the appropriate 
regulatory agency to establish a modeling protocol to ensure that the 
agency's needs are met and that the meteorological files used are 
acceptable before initiating the modeling work. In the western Gulf of 
Mexico (west of 87.5[deg] west longitude) and offshore of the North 
Slope Borough of Alaska, you must submit to BOEM three copies of the 
modeling report and three sets of digital files as supporting 
information. The digital files must contain the formatted 
meteorological files used in the modeling runs, the model input file, 
and the model output file.


Sec.  585.701  How must I conduct my approved activities to protect 
marine mammals, threatened and endangered species, and designated 
critical habitat?

    (a) You must not conduct any activity under your lease or grant 
that may affect threatened or endangered species or that may affect 
designated critical habitat of such species until the appropriate level 
of consultation is conducted, as required under the ESA, as amended (16 
U.S.C. 1531 et seq.), to ensure that your actions are not likely to 
jeopardize a threatened or endangered species and are not likely to 
destroy or adversely modify designated critical habitat.
    (b) You must not conduct any activity under your lease or grant 
that is likely to result in an incidental taking of marine mammals 
until the appropriate authorization has been issued under the Marine 
Mammal Protection Act of 1972 (MMPA) as amended (16 U.S.C. 1361 et 
seq.).
    (c) If there is reason to believe that a threatened or endangered 
species may be present while you conduct your BOEM-approved activities 
or may be affected by the direct or indirect effects of your actions:
    (1) You must notify us that endangered or threatened species may be 
present in the vicinity of the lease or grant or may be affected by 
your actions; and
    (2) We will consult with appropriate State and Federal fish and 
wildlife agencies and, after consultation, shall identify whether, and 
under what conditions, you may proceed.
    (d) If there is reason to believe that designated critical habitat 
of a threatened or endangered species may be affected by the direct or 
indirect effects of your BOEM-approved activities:
    (1) You must notify us that designated critical habitat of a 
threatened or endangered species in the vicinity of the lease or grant 
may be affected by your actions; and
    (2) We will consult with appropriate State and Federal fish and 
wildlife agencies and, after consultation, shall identify whether, and 
under what conditions, you may proceed.
    (e) If there is reason to believe that marine mammals are likely to 
be incidentally taken as a result of your proposed activities:
    (1) You must agree to secure an authorization from National Oceanic 
and Atmospheric Administration (NOAA) or the U.S. Fish and Wildlife 
Service (FWS) for incidental taking, including taking by harassment, 
that may result from your actions; and
    (2) You must comply with all measures required by the NOAA or FWS, 
including measures to affect the least practicable impact on such 
species and their habitat and to ensure no immitigable adverse impact 
on the availability of the species for subsistence use.
    (f) Submit to us:
    (1) Measures designed to avoid or minimize adverse effects and any 
potential incidental take of the endangered or threatened species or 
marine mammals;
    (2) Measures designed to avoid likely adverse modification or 
destruction of designated critical habitat of such endangered or 
threatened species;
    (3) Your agreement to monitor for the incidental take of the 
species and adverse effects on the critical habitat, and provide the 
results of the monitoring as required;
    (4) Your agreement to perform any relevant terms and conditions of 
the Incidental Take Statement that may result from the ESA 
consultation; and
    (5) Your agreement to perform any relevant mitigation measures 
under an MMPA incidental take authorization.

[[Page 42762]]

Sec.  585.702  What must I do if I discover a potential archaeological 
resource while conducting my approved activities?

    (a) If you, your subcontractors, or any agent acting on your behalf 
discovers a potential archaeological resource while conducting 
construction activities, or any other activity related to your project, 
you must:
    (1) Immediately halt all seafloor-disturbing activities within the 
area of the discovery;
    (2) Notify BOEM of the discovery within 72 hours; and
    (3) Keep the location of the discovery confidential and not take 
any action that may adversely affect the archaeological resource until 
we have made an evaluation and instructed you on how to proceed.
    (b) We may require you to conduct additional investigations to 
determine if the resource is eligible for listing in the National 
Register of Historic Places under 36 CFR 60.4. We will do this if:
    (1) The site has been impacted by your project activities; or
    (2) Impacts to the site or to the area of potential effect cannot 
be avoided.
    (c) If investigations under paragraph (b) of this section indicate 
that the resource is potentially eligible for listing in the National 
Register of Historic Places, we will tell you how to protect the 
resource, or how to mitigate adverse effects to the site.
    (d) If we incur costs in protecting the resource, under section 
110(g) of the NHPA, we may charge you reasonable costs for carrying out 
preservation responsibilities under the OCS Lands Act.


Sec.  585.703  How must I conduct my approved activities to protect 
essential fish habitats identified and described under the Magnuson-
Stevens Fishery Conservation and Management Act?

    (a) If, during the conduct of your approved activities, BOEM finds 
that essential fish habitat or habitat areas of particular concern may 
be adversely affected by your activities, BOEM must consult with 
National Marine Fisheries Service.
    (b) Any conservation recommendations adopted by BOEM to avoid or 
minimize adverse effects on essential fish habitat will be incorporated 
as terms and conditions in the lease and must be adhered to by the 
applicant. BOEM may require additional surveys to define boundaries and 
avoidance distances.
    (c) If required, BOEM will specify the survey methods and 
instrumentations for conducting the biological survey and will specify 
the contents of the biological report.

[FR Doc. 2024-08791 Filed 5-14-24; 8:45 am]
 BILLING CODE 4340-98-P